MMF – NKANGALA DISTRICT 2 1 /06/2013
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Transcript of MMF – NKANGALA DISTRICT 2 1 /06/2013
PREPARATION 2012/13
PRESENTED BY: WISEMAN KHUMALO (AIMFO)CHIEF FINANCIAL OFFICER
EHLANZENI DISTRICT MUNICIPALITY
MMF – NKANGALA DISTRICT
21/06/2013
CONTENTS
BACKGROUNDCOST OF COMPLIANCEPREPARATION MATERIALPREPRATION FOR 2012/13 AUDITAUDIT APPROACHAUDIT CHALLENGESRECOMMENDATIONS
BACKGROUND
SUBMISSION – TWO MONTHS AFTER END OF FINANCIAL YEAR AS PER MFMA – 31 AUGUST 2013
ANNUAL PERFORMANCE REPORT TO BE SUBMITTED AS WELL – 31 AUGUST 2013
ASSUMPTION – THAT ISSUES RAISED IN THE MANAGEMENT LETTER HAVE BEEN CLEARED BY NOW.
ACTION PLAN WAS SUBMITTED TO COUNCIL AND MONITORING HAS BEEN DONE
COST OF COMPLIANCE
MAINLY GRAP COMPLIANCE- GRAP 25 ( ACTUARIAL VALUATION TO COMPLY)- GRAP 17, 16 – FULLY GRAP COMPLIANT ASSET REGISTER (USE OF ENGINEERS, GIS SPECIALISTS)- GRAP 101 (AGRICULTURE) FORESTRY INCLUDING BIOLOGICAL ASSETS (ANIMALS) - ACTIVITIES – VALUATION OF PLANTATIONS- GRAP 103 HERITAGE ASSETS – VALUATION- VERY EXPENSIVE TO COMPLY
PREPARATION MATERIAL
MFMA REPORTING REQUIREMENTS INCLUDING DELEGATIONS
GRAP – CFO AND INTERNAL AUDIT ( IDENTIFICATION, RECOGNITION, MEASUREMENT, PRESENTATION AND DISCLOSURE)
DIRECTIVES FROM ASB, TREASURY GUIDE AND CIRCULARS FROM PT & NT SUPPLY CHAIN REGULATIONS AND POLICY – ALL
TRANSACTION TO HAVE FOLLOWED THE SCM POLICY AND OTHER RELATED POLICIES
MUNICIPAL PLANNING AND PERFORMANCE MANAGEMENT REGULATION OF 2001 – AG USES IT
MANAGEMENT AVAILABLE & CONSULTANTS
PREPARATION 2012/13
ESTABLISH A PROJECT STEERING COMMITTEE (PREFERABLE MM TO CHAIR)
ESTABLISH FINANCE AFS PREPARATION TEAM (TO BE CHAIRED BY CFO)
PREVIOUS ISSUES RAISED IN THE MANAGEMENT LETTER CLEARED – INTERNAL AUDIT TO GIVE ASSURANCE THAT MATTERS PREVIOUSLY RAISED HAVE BEEN CLEARED
INTERNAL AUDIT REPORTS – IA TO MAKE SURE THAT THE ISSUES RAISED HAVE BEEN CLEARED BY MANAGEMENT
PREPARATION 2012/13
PRIOR TO DRAFTING AFS – MAKE SURE THAT CORRECTIONS HAVE BEEN MADE WITH PROPER SUPPORTING DOCUMENTS E,G SUPPORTING VOUCHERS TO JOURNALS
ACCOUNTING POLICIES – REVIEWED AND UPDATED (NEW STANDARDS)
CORRECTIONS TO BE IN LINE WITH GRAP, ESPECIALLY GRAP 3 WHERE CORRECTION OF PRIOR PERIOD ERRORS, CHANGES IN ESTIMATES ETC – AGREE WITH THE AG IF POSSIBLE
UNAUTHORISED, IRREGULAR AND FRUITELESS – DISCLOSE IN THE AFS, REPORTED TO CONDONE TO HAVE BEEN SUBMITTED TO COUNCIL ON DEVIATIONS (SCM)
RELATIONSHIP WITH THE AUDITOR GENERAL – AVOID TENSIONS IN ALL POSSIBLE WAYS
PREPARATION 2012/13
SELF AUDIT BY ALL DEPARTMENTS – COMPLIANCE MATTERS
MPPM- SMART OBJECTIVES, QUARTERLY REPORTS, PoE – ACCURATE, RELIABLE AND COMPLETE – OBJECTIVES LINKED TO ORGANISATION OBJECTIVES CONTAINED ON THE IDP, SDBIP IN LINE WITH BUDGET AND IDP (LINKAGE)
CONTRACT REGISTER, FAR, INVESTMENT, LOANS ETC RECONCILED
DETAILED AUDIT WORKING PAPER FILEDRAFT AFS, APR AND SUBMIT TO IA &AUDIT
COMMITTEE PRIOR TO SUBMISSION
2012/13 APPROACH TO AUDIT
9
EXCEPTION RAISED – EARLY
RESOLUTION RECOMMENDED
CLEARED WITH AUDITORS NOT CLEARED
COMMUNICATION OF
FINDINGS (FORMAL)
MANAGER INFORMED
SUBMISSION TO MM
SUBMISSION BY MM TO A-G
DISCUSSED – AUDIT STEERING COMMITTEE
MEETING
DEPUTIES/ ASSISTANTS CLEARE THE
QUERY
CORRECTION MADE /
AFS ADJUSTED
ETC
AUDIT CHALLENGES
Compliance with GRAP standards and interpretations including new GRAP standards
Management estimates – AG vs. Auditors – landfill site provisions Audit risks vs. Business risks Material adjustments to AFS Prior year adjustments Internal control deficiencies – identified by A-G Non reliance on Internal Audit work done by A-G Negative publicity – objectivity of AG??? Record keeping Availability of key personnel – AG and Management Rotation of A-G Auditors (Annually new team) Audit (Add value) vs. Investigation Extrapolation 30 days – weekends and public holidays counted State employees in the service of the state
RECOMMENDATIONS
COMMON GOAL ALL STAFF MEMBERS INCLUDING MANAGEMENT– UNQUALIFIED (NO EMPHASIS)
FUNCTIONAL STREERING COMMITTEES (MM & CFO TO ATTEND)
EARLY RESOLUTION OF AUDIT QUERIESMANAGEMENT AND CONSULTANTS TO BE
AVAILABLE DURING AUDITRELATIONSHIP WITH THE AUDITORS – AVOID
TENSIONSFUNDS FOR COST OF COMPLIANCE – NT, PT, COGTAAUDIT CHALLENGES RAISED WITH PT TO DISCUSS
WITH AG – MMF TO FOLLOW UP – AS THERE IS NO PROGRESS / FEEDBACK TO DATE
THANKS