The South African Broadcasting Corporation (SABC) has for the first since 2009 obtained an unqualified audit opinion.
The public broadcaster has tabled its 2023-2024 Annual Report in Parliament.
An unqualified audit opinion means that the auditors found the financial statements to be fairly presented and in accordance with the applicable financial reporting framework.
The SABC said that the pleasing results were due to more focus being placed on their financial disciplines and making an effort to institutionalise good governance throughout the business.
“I am proud that the SABC has achieved another significant milestone on our journey of recovery, renewal and growth. Our unqualified audit opinion follows a number of recent achievements including our much-lauded Election coverage, the relaunch and rapid audience growth of our SABC+ streaming platform as well as our content partnerships with leading global and local media houses,” Nomsa Chabeli, the SABC’s Group Chief Executive Officer (CEO) said.
Key findings
The report also found that the SABC increased its advertising revenue by 7%.
The SABC was able to lower its operating expenses when compared to the 2022-2023 year.
The broadcaster also said that there was a decrease of 77% of the loss before interest and tax of R192 million from R827 million in the previous year.
The SABC said that the cost of the unfunded public interest mandate is estimated to be R834 million.
Securing government funding for this mandate is an important priority for the public broadcaster.
“Despite financial sustainability challenges, the Corporation executed its mandate diligently and passionately.
Achieving an unqualified opinion, a first in 14 years, reflects the strategic journey the SABC has undertaken to strengthen its internal control environment, its compliance with legislation, expenditure management, governance and oversight,” chief financial officer, Yolande van Biljon said.
Global streamers
The South African audience has been following global trends and has moved to streaming platforms.
A decline in audience share from a high of 46% in the financial year of 2016 continued to negatively impact SABC’s ability to grow its revenue streams.
“This is illustrated by the R2 billion decline in revenue since 2016, whilst revenue year on year has remained mostly flat since 2021,” the SABC said.
The public broadcaster also noted that there has been a decline in TV license revenue, stemming from fees.
“Levels of license fee non-compliance have continued to decline as households afford it a low priority in times of economic hardship and the reality is also that compliance cannot be enforced,” the SABC said.
The non-compliance rate increased to 85.6% in 2024 and therefore the broadcaster said it will focus attention on creating new equitable financial models for funding the SABC.
No money for innovation and technology
Will the SABC be able to meet its obligations?
The company expressed uncertainty about its ability to continue implementing stringent austerity measures, which include suspending over 80% of the long-term Capital Plan and restricting investment in content.
“It must be noted that virtually no funding is currently available for any capital investment in innovation, infrastructure and technology,” the SABC said.
The company has been pushed down by huge financial constraints and this has hampered its efforts to meet its content delivery plan for linear television.
Despite this, the SABC remains positive and said it was committed to further developing the SABC Plus streaming platform.
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