Briefing to the Portfolio Committee on Economic Development Department on the audit outcomes for the 2013/2014 financial yearPresenter: Ahmed Moolla

October 2014

Reputation promise/mission

The Auditor-General of South Africa has a constitutional mandate and,

as the Supreme Audit Institution (SAI) of South Africa, it exists to strengthen our

country’s democracy by enabling oversight, accountability and governance in the public sector through auditing, thereby building public

confidence.

To provide members of parliament with the necessary information/guidance on the audit outcomes for the portfolio to enable the Portfolio Committee to effectively execute their oversight function.

Purpose of presentation

Audit outcomes for the portfolio

Audit outcomes for the portfolio

Audit outcomes for the portfolio

Audit outcomes for the portfolio

Audit outcomes for the portfolio

Audit outcomes for the portfolio

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End-year reporting

Strategic Planning

Implementation and in-year reporting

Operational planning and

budgeting

Policy development

INSTITUTIONNational department

Provincial departmentMunicipalityPublic entity

Municipal entity

OVERSIGHT:Parliament, provincial legislature or municipal council

Oversight model

Accountability

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Role of Portfolio Committees (Rule 201)

Oversight component - Portfolio committee mandate

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• Is the Strategic Plans and Annual Performance Plans for entities aligned to the National Development Plan

• Does the entity have adequate resources (human and financial) available to achieve predetermined objectives

• Are the targets realistic (can it be done)

• How are the entities ensuring that Strategic Plans and Annual Performance Plans will be achieved (performance contracts, quarterly monitoring, etc.)

• The Portfolio committee should review the quarterly progress of entities with regard to predetermined objectives and contributions to NDP

• The Portfolio committee should review annual achievement of predetermined objectives by entities (Annual Reports)

• The Portfolio committee should approve and track changes to strategic plans and annual performance reports

Considerations for Portfolio Committees when dealing with performance monitoring

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Seniormanagement

Accountingofficers/authority

Executiveauthority

Required assurance levels

Extensive Extensive Extensive

Management’s assurance role•Senior management – take immediate action to address specific recommendations and adhere to financial management and internal control systems

•Accounting officers/ authority – hold officials accountable on implementation of internal controls and report progress quarterly and annually

•Executive authority – monitor the progress of performance and enforce accountability and consequences

Management assuranceFirst level of assurance

Seniormanagement

Accountingofficers/authority

Combined assurance model

Oversight assuranceSecond level of assurance

Coordinating /Monitoringinstitutions

Internalaudit

Auditcommittee

Extensive Extensive Extensive

Required assurance levels

Oversight’s assurance role•National Treasury/ DPSA – monitor compliance with laws and regulations and enforce appropriate action

•Internal audit – follow up on management’s actions to address specific recommendations and conduct own audits on the key focus areas in the internal control environment and report on quarterly progress

•Audit committee – monitor risks andthe implementation of commitments on corrective action made by management as well as quarterly progress on the action plans

Independent assuranceThird level of assurance

Oversight(portfolio

committees / councils)

Publicaccounts

committee

Extensive Extensive

Required assurance levels

Role of independent assurance•Oversight (portfolio committees) – review and monitor quarterly progress on the implementation of action plans to address deficiencies

•Public accounts committee – exercise specific oversight on a regular basis on any report which it may deem necessary

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Creating a better and dignified life for the citizens of South Africa through timely effective, efficient and economical SERVICE DELIVERY

How does clean administration improve service delivery

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A common reaction to the general reports relates to the questions posed by many, including key role players in government, about the need for accountability and consequences and how these can be enforced. Legislation provides the answer to this question as it clearly defines accountability and the remedies.

Details are available on pages 44 to 65 of our booklet:In Brief: The Auditor-General of South Africa

Accountability and remedies to address transgressions and poor performance

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This AGSA booklet highlights the legislation that enables remedies to be applied where national and provincial departments are guilty of transgressions and poor performance. It addresses the following typical matters reported in the general

•reports:

•Failure to comply with legislated obligations and responsibilities

•Unauthorised, irregular and fruitless and wasteful expenditure

•Possible fraud and corruption

•Poor work performance – officials and suppliers

•Other non-compliance with legislation

Accountability and remedies to address transgressions and poor performance

Questions