A Comparative Assessment of Compliance Implementation in Mitigating Irregular Expenditure Within South Africa Major Public Entities

The study examined how effectively major public entities (MPEs) implement compliance measures to reduce irregular expenditure (IE) reported in their annual reports, by comparing IE over two-years period. MPEs are governed and held accountable through corporate governance frameworks and stipulations derived from PFMA and government regulations. Therefore, to avoid incurring IE, MPEs must comply with supply chain management (SCM) frameworks. Qualitative research approach was adopted using content analysis to assess compliance implementation in reducing IE. MPEs annual reports (AR) served as the unit of observation and IE closing balances were used to calculate change in IE percentage. The findings show that regardless of SCM frameworks being in place, most of the MPEs still struggle to implement effective controls to ensure compliance with relevant SCM legislation, leading to continuous IE being reported. Results contribute to agency, institutional and accountability theories and suggest that managers should prioritise practices that benefit the entity over their own financial benefits by implementing a sound compliance system to reduce IE. MPE's management should enforce accountability and apply consequence management to enhance organisational compliance culture. Furthermore, analysis of results provides managerial implications for MPEs' management and policymakers to strengthen their SCM internal control systems and provide continuous training for employees involved in the procurement process to equip their procurement skills. Moreover, management must ensure that all AGSA recommendations regarding IE are implemented to prevent future incurrence of IE.