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Audit outcomes of North West local government

Audit outcomes of North West local government. 28 May 2013.

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Audit outcomes of North West local government

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  1. Audit outcomes of North West local government 28 May 2013

  2. 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.

  3. Audit outcomes over the past three years • All audits (including prior year backlogs) have been completed • Minimal improvementover 2010-11 2011-122010-11 2009-10 Unqualified with NO findings Adverse/ DisclaimerWITH findings Unqualified WITH findings Qualified WITH findings

  4. Backlog audits

  5. Movements of the 27 auditees reported on Movements 4 21 2

  6. Status of compliance with laws and regulations 100% There are material findings at ofthe auditees 2011-12 2010-11 Auditees with no compliance findings Auditees with compliance findings

  7. Quality of annual performance reports 89% There are material findings on the performance reports of of the auditees 2011-12 2010-11 Auditees with no PDO findings Auditees with PDO findings

  8. What are the areas that should be focused on?

  9. Focus areas to improve audit outcomes Supply chain management Quality of performance reports Human resource management Information technology (IT) controls Quality of submitted financial statements Financial health (going concern) With no findings With findings

  10. Quality of submitted financial statements Due to correction of material misstatements during the audit process, of auditees were able to avoid qualifications. 19% Outcome if NOT corrected Outcome after corrections 5 (19%) 27 (100%) 22 (81%) Unqualified Qualified

  11. What vital actions should be taken?

  12. Improving the drivers of key controls will improve audit outcomes • Slight improvement in Governance • Leadership and Financial and performance management remains largely unchanged Leadership Financial and performance management Governance XX% 2011-12 2010-11 2011-12 2010-11 2011-12 2010-11 Good Causing concern Intervention required

  13. … as will addressing the continuing pervasive root causes Key positions vacant or key officials lacking appropriate competencies A major challenge at 26 (96%) of the auditees. Lack of consequences for poor performance and transgressions A major challenge at 26 (96%) of the auditees. Slow response by political leadership in addressing the root causes of poor audit outcomes A major challenge at 26 (96%) of the auditees.

  14. Which key role players should take action?

  15. Extensive assurance should be provided by the key role players First level of assurance Management/leadership Second level of assurance Internal independent assurance and oversight Third level of assurance External independent assurance and oversight External audit Municipal council Municipal public accounts committee Legislature and portfolio committee Internal audit Audit committee Treasury, Local Government Dept., SALGA, Premier’s office Senior management Municipal manager Mayor Not established Provides assurance Provides some assurance Provides limited/no assurance

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