The following additional observations were made: . Some municipalities did not have fully functional internal audit committees; . Training is needed with respect to the Municipal Finance Management Act, GRAP reporting requirements and financial systems; . Some municipalities do not submit reports according to the Municipal Finance Management Act; . The capacity of water purification plants does not cope with the demand for clean drinking water; . Most sector departments do not participate in the Integrated Development Plans; . Illegal electricity connections are costing municipalities a huge amount of money; . There is a lack of co-operation from most farm owners to allow delivery of services to communities living on farm lands; . The debt collection rate is poor; . Ratepayers Associations are refusing to pay for municipal rates; . The treasury and budget offices of most municipalities are not fully staffed; . Municipal budgets are unrealistic; . The indigent registers of most municipalities are not up-to-date; . The EPWP II programme is not known to most municipalities; and . There is poor co-ordination between sector departments and municipalities especially when the former is implementing projects in municipalities.