CFO not suspended: Broadband Infraco

Broadband Infraco, the state owned enterprise (SOE) tasked with improving internet access and lowering broadband prices, says it has not suspended its CFO, Ramasela Magoele.

The group dismissed allegations that the company conducted and completed a preliminary investigation against Magoele for breach of PFMA regulations. It was alleged that her suspension was imminent, while four staff members in the company’s procurement department were are also under investigation.

Broadband Infraco said in a statement on Monday (18 February) that having experienced past breakdowns in internal controls, several preventative and corrective measures have been put in place to enable a more pro-active approach in detecting and resolving internal governance matters.

In its 2012 Annual Financial Report, Broadband Infraco noted that it reported commissioning investigations to assess compliance with procurement and contract management.

“As part of this process, on Friday 15th February 2013 the National Treasury requested the laptops of some procurement staff for standard data acquisition.  The process went very smoothly with employees giving their full cooperation.

“None of the staff members were/are suspended or are under investigation. They are all at work executing normal duty.

Broadband Infraco also places on record that its chief financial officer (CFO) Ms  Ramasela Magoele has not been suspended and regrets destructive rumours of such nature. Ms Magoele remains a member of its executive management team,” it said.

The group said that it was currently understaffed and has recruited new employees to join the Procurement Department in March 2013.

“Broadband Infraco has no plans to outsource its procurement department,” it stressed.

Poor governance and leadership has plagued the company in the past. It received a qualified audit in February 2011 due to irregular expenditure of R151 million, and fruitless and wasteful expenditure of R1.9 million. In the same month, the group’s CEO Dave Smith resigned.

In October 2011, Minister of Public Enterprises Malusi Gigaba filled four vacancies on the company’s board and replaced three non-executive board members. Three of the 11 board members reportedly had shares in companies which were awarded contracts with the state owned firm.

In April last year, Gigaba, has appointed Puleng Sejanamane as the CEO of the company, replacing acting head, Andrew Shaw, who had previously worked as acting director-general of the Department of Public Enterprises from March 2010 to January 2011.

The group’s results in 2012 were more encouraging. And although it announced a loss for the year of R95 million, this was better than a loss of R206 million reported in 2011.

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CFO not suspended: Broadband Infraco