Arms manufacturer Denel told Parliament’s Public Enterprises Committee on Wednesday that the state of the company's finances has improved slightly.
This is on the back of the company previously saying that it was unable to pay salaries.
Speaking to Xolani Gwala, Denel Board Member and the chair of Denel's Audit Committee, Talib Sadik says the point made to Parliament was that its employees look at Denel for more than just salaries. They also want to see an organisation that is well governed and corruption free, he explains.
Salaries at the moment are not a risk to us.— Talib Sadik, Denel Board Member and the Chairperson of Denel's Audit Committee
He adds even though it is able to pay salaries, the company remains in a liquidity crunch and needs to manage its working capital.
Sadik explains that it recently received an increase from its government guarantees from R2.7 billion to R3.3 billion and enjoy good support from its shareholders.
Importantly, he adds that its relationships with banks and lenders have improved. He says it has set up a forensic investigation to look into all Gupta linked VR Lazer Group transactions.
What we have done is that we have terminated all transactions with the VR Lazer Group.— Talib Sadik, Denel Board Member and the Chairperson of Denel's Audit Committee
Sadik admitted that the bursary granted to former premier of the North West Supra Muhamapelo was fraudulent and says it was outside its policy.
The criteria used to award the bursary was R1.5 million to Mr Mahumapelo and on average our bursaries were normally about R 100 000 putting it outside our ordinary course of business and as a result, there is a criminal investigation and a civil claim made.— Talib Sadik, Denel Board Member and the Chairperson of Denel's Audit Committee
Listen below to the full interview:
This article first appeared on 702 : Investigation into fraudulent bursary for Supra's son - Denel