Planes moving through South African skies generate bills, and Air Traffic and Navigation Services is the state-owned company that sends them. For the year to March, the Auditor-General has declined to say whether those bills add up. It issued a disclaimer of opinion, which is not a finding that the books are wrong. It is a statement that there was not enough reliable evidence to judge them at all.
Records that could simply disappear
ATNS runs air traffic control over South Africa and big stretches of the southern Indian and Atlantic oceans. It billed for 303,034 aircraft movements in the year, up from 287,760, and that billing is almost entirely automated, run by its IT systems.
That is where the auditors got stuck. They found serious weaknesses in the controls over those systems, so they could not rely on the reports the systems produced. When they tried other checks, they found gaps between the source data and what had been recorded, and numerous transactions deleted with no adequate, verifiable explanation and no audit trail showing why. In the auditors' own reading, revenue records can be removed without anything in place to stop it or catch it, which raises the risk that real aircraft movements never reach the bill at all.
So the R2.07 billion of revenue in ATNS's statements stands unconfirmed, because the auditors could not check it any other way. Most of that comes from the regulated side of the business, where the directors' report puts revenue at R1.82 billion, up 18.9%. The same audit found ATNS had not taken effective steps to collect all the revenue it was due.
A loss, and a long-term fix
None of this means money has been found missing. The auditors simply could not establish the number either way. What the statements do show is a year in the red: a loss of R36.5 million, after a profit of R22.3 million the year before. Running costs grew faster than regulated revenue, climbing 20.2% to R1.92 billion on staff, travel, professional fees and repairs.
ATNS told Business Day, which first reported the audit, that it accepts responsibility for oversight of its control environment and that the board is monitoring an audit improvement plan. Where it makes sense, management will modernise the systems to cut out manual steps, which ATNS itself calls a long-term job.
Its revenue, in the meantime, keeps running through the systems the auditors could not rely on.
