Sources and methodology
Every figure on this site comes from a published government source. This page sets out which source, how often it is refreshed, and exactly how the financial health grade is calculated.
Where the data comes from
National Treasury supplies municipal finances through its Local Government Database, published via the Municipal Money API. This covers revenue, expenditure, financial position, cash flow, capital spending and unauthorised, irregular, fruitless and wasteful expenditure. Figures are reported in thousands of rands and are refreshed quarterly. It is also the source of the audit outcome recorded for each year, and of the annual reports, audited financial statements, audit reports and integrated development plans linked on each profile.
Statistics South Africa supplies population, households, age structure, education and household services from the 2022 census, with 2016 and 2011 shown alongside for comparison. Where a figure was not published for a given census year it appears as not available rather than being estimated.
The Municipal Demarcation Board supplies municipal boundaries and MDB codes. The maps on this site are drawn from its published boundary data, reprojected and simplified for display.
The Auditor-General of South Africa is the origin of audit opinions, reported through Treasury’s schedules.
The Electoral Commission is the source of council seat allocations, which reflect the 2021 local government elections and will be updated after the elections on 4 November 2026.
How the financial health grade works
The grade is this site’s own measure, not an official government rating. It exists because the underlying figures are meaningful but hard to read: a balance sheet does not tell most people whether a municipality is in trouble. The grade combines five components, each scored out of 100 and then weighted:
- Audit outcome, 30%. A clean audit scores 100, financially unqualified 72, qualified 40, adverse 15, and a disclaimer 0.
- Operating margin, 20%. Operating surplus or deficit as a share of operating revenue. A deficit of 10% or worse scores 0; a surplus of 10% or better scores 100.
- Current ratio, 20%. Current assets divided by current liabilities. A ratio of 2.0 or better scores 100. Below 1.0 means short-term bills exceed short-term assets.
- Cash coverage, 15%. Cash at year end divided by average monthly expenditure. Three months or more scores 100, in line with Treasury norms.
- Irregular spending, 15%. Unauthorised, irregular and fruitless or wasteful expenditure as a share of total expenditure. Zero scores 100; 10% or more scores 0.
The weighted total is graded A for 85 and above, B for 70, C for 55, D for 40, E for 25 and F below that. Where a component cannot be calculated because a figure is missing, the remaining components are reweighted, and the profile records the confidence as partial rather than high. A municipality with fewer than three usable components is not graded at all.
The grade uses the most recent financial year for which the municipality reported a total expenditure figure, which is stated on every scorecard. Because municipalities report at different times, two profiles may be graded on different years.
What the grade does not measure
It measures financial management, not service delivery, governance quality or value for money. A municipality can be financially sound and still deliver poorly, or be under real strain while serving residents well. Service delivery figures are published separately on each profile and in the comparison tool.
Known limits
Unemployment is reported by Statistics South Africa at municipal level only for 2011, so it is not used in comparisons. Some financial line items are not reported by every municipality, and appear as not available. District and local municipalities cover the same ground, so population is never summed across both. Absolute rand amounts are never ranked between municipalities of different sizes, because a small municipality’s modest deficit can be far worse for its size than a metro’s larger one.