When determining for the purposes of section 137 the seriousness of a financial problem, all relevant facts must be considered, and the following factors, singly or in combination, may indicate a serious financial problem:
| (a) |
The municipality has failed to make payments as and when due; |
| (b) |
the municipality has defaulted on financial obligations for financial reasons; |
| (c) |
the actual current expenditure of the municipality has exceeded the sum of its actual current revenue plus available surpluses for at least two consecutive financial years; |
| (d) |
the municipality had an operating deficit in excess of five per cent of revenue in the most recent financial year for which financial information is available; |
| (f) |
the Auditor-General has withheld an opinion or issued a disclaimer due to inadequacies in the financial statements or records of the municipality, or has issued an opinion which identifies a serious financial problem in the municipality; |
| (g) |
any of the above conditions exists in a municipal entity under the municipality's sole control, or in a municipal entity for whose debts the municipality may be responsible, and the municipality has failed to intervene effectively; or |
| (h) |
any other material condition exists which indicates that the municipality, or a municipal entity under the municipality's sole control, is likely to be unable for financial reasons to meet its obligations. |
Contingency Fees Act, 1997
