Literature museum gives up on municipality's unpaid bills

A national literature museum has given up hope of recovering money a cash-strapped Eastern Cape municipality owes it.

Amazwi South African Museum of Literature said Inxuba Yethemba Municipality is its "sole material debtor".

Under an agreement, the municipality must pay half the salaries at Schreiner House Museum in Nxuba.

Amazwi says the municipality has a history of non-payment over several years.

"During 2025/26, Amazwi assessed the credit risk of Inxuba Yethemba Municipality in line with the requirements of the revised accounting standard on Financial Instruments (GRAP 104) and concluded that recovery was unlikely. The assessment was based on the Municipality's cash flow constraints (a net outflow of cash reserves as at 30 June 2025) and a history of non-payment over several years, leading the Museum to conclude there was no realistic prospect of recovery," said chief financial officer Musawakhe Mazibuko.

The debt is why Amazwi took 284 days on average to collect money owed to it. The Auditor-General flags anything above 90 days.

Amazwi also lost its clean audit for 2025/26, getting an unqualified opinion with findings.

The Auditor-General reported this to Parliament's NCOP Select Committee on Education, Sciences and Creative Industries on 27 October.

Mazibuko admitted the museum's own checks failed.

"The findings arose because the draft financial statements were not reviewed thoroughly enough before submission for audit," he told Africa Daily.

One error came from a spreadsheet. "The variance column contained adding-up errors because a spreadsheet formula did not include all the line items," he continued.

He said "the formula error was not caught because the statement was assumed to be correct, and no manual check was made".

The Auditor-General also found Amazwi paid its creditors in 36 days on average. The law requires 30. Amazwi said this was an improvement on 55 days the year before.

"The Museum accepts that it must pay within 30 days consistently," Mazibuko said.

Yet in the same response, the museum said it "remains compliant with the 30-day payment requirement under Section 38(1)(f) of the PFMA and Treasury Regulation 8.2.3".

Amazwi said it has an audit action plan, including a GRAP checklist and independent recalculation of its statements, to win back its clean audit.