Reports that enable accountability and oversight

1. Reports that enable accountability and oversight Paul Mosaka, Business Executive 14 April 2010

2. A. General Reports of the AGSA The AGSA annually produces the following transversal or general reports that present the consolidated results of regulatory audits in all three spheres of government: The General Reports on the consolidated audit outcomes of – • National government departments, public entities and constitutional institutions • Provincial departments, public entities and other entities • Municipalities and municipal entities We believe that the consolidated Provincial and Municipal General Reports are very useful documents of for NCOP committees such as the SC on Finance and SC on Appropriations to enable well-informed oversight

3. A. General Reports of the AGSA (Transversal reports that present the consolidated results of regulatory audits) 1. General Report on consolidated provincial audit outcomes • AUDIT OUTCOMES FOR 2008-09 • Status of completion of audits • Five year review of audit outcomes • Audit outcomes: Provincial legislatures, departments, public entities and other provincial entities •  KEY SYSTEMIC ISSUES • Impact of commitments and initiatives of the executive • Impact of initiatives of other role players • Accounting reforms •  ANALYSIS OF AUDIT QUALIFICATIONS AREAS AND ROOT CAUSES • WARNING SIGNALS REQUIRING ATTENTION

4. General Report on provincial audit outcomes (cont.) • RESULTS OF AUDITS OF INFORMATION SYSTEMS • SIGNIFICANT FINDINGS FROM AUDITS OF HR MANAGEMENT & COMPENSATION OF EMPLOYEES • AUDIT OF PERFORMANCE INFORMATION • CONSOLIDATED FINANCIAL STATEMENTS • STATUS OF TABLING OF ANNUAL REPORTS • STATUS REPORT ON PERFORMANCE AUDITS, INVESTIGATIONS & SPECIAL AUDITS • ANNEXURES TO GENERAL REPORT: • Annexure 1: Listing of areas qualified in financial statements of legislatures, departments and entities • Annexure 2: Listing of legislatures, departments and entities with emphasis of matter and ‘other matter’ findings • Annexure 3: Listing of five year audit opinions • Annexure 4: Listing of audits finalised late or outstanding

5. General Reports of the AGSA (cont.) 2. General Report on consolidated municipal audit outcomes: • AUDIT OUTCOMES FOR 2008-09 • Audit outcomes for municipalities, including the metro and municipal entities • Status of completion of audits • Five-year overview of audit outcomes • REMEDIAL ACTION TAKEN ON AUDIT OUTCOMES OF PRIOR YEARS • Initiatives by strategic role players to address past audit outcomes • Key internal focus areas that should be addressed to improve audit outcomes • Future commitments to achieve clean audit opinions • ANALYSIS OF CURRENT YEAR AUDIT OUTCOMES: Analysis of audit areas qualified and root causes • WARNING SIGNALS REQUIRING ATTENTION • OTHER REPORTING RESPONSIBILITIES • Introduction • Performance information • Status of performance audits, investigations and special audits

6. General Report on municipal audit outcomes (cont.) • CONSOLIDATED FINANCIAL STATEMENTS AND TABLING OF ANNUAL REPORTS • CONCLUSION • ANNEXURES TO GENERAL REPORT: • Annexure 1: Listing of audit outcomes for municipalities, including the metro and municipal entities • Annexure 2: Listing of five-year audit opinions • Annexure 3: Listing of municipalities, including the metro and municipal entities with non-compliance findings • Annexure 4: Material losses/impairments, unauthorised expenditure, fruitless and wasteful and irregular expenditure, including material under-spending of budgets and unspent government grants • Annexure 5: Listing of municipalities with non-compliance findings related to performance information

7. B. The annual report as key accountability instrument Sections 92 and 133 of the Constitution require of executive authorities in the national and provincial cabinets to provide the legislatures “with full and regular reports concerning matters under their control” Annual reports of municipalities are required in terms of the section 127 of the MFMA

8. Structure of an annual report • Structure must be consistent with Strategic Plan • Contents (proposed by the National Treasury), for example • General Information • Department / Programme Performance • Service Delivery Improvement Plans • Human Resource Management • Finance • Statutory Bodies • Organisational Structure

9. Part 2: Reporting on programme performance • What to look for? • Did the department achieve the objectives it commitment to achieve in its strategic plan and budget? • Are the explanations (“comments”) for non-achievement acceptable / credible? • Do actual achievements reported reconcile with information on what is happening on the ground within constituencies, or from the perspective provided by the AGSA or other reporting agencies (Whether the objectives were SMART needs to be established when the strategic plan and the budget is tabled in Parliament for approval.)

10. Part 5: Finance • Accounting Officer’s Report • Audit Committee Report • Report of the Auditor General • Appropriation Statement and notes thereto • Statement of Financial Performance (previously Income Statement) • Statement of Financial Position (previously Balance Sheet) • Statement of Changes in Net Assets • Cash Flow Statement • Accounting Policies • Notes to the Annual Financial Statements • Disclosure Notes to the Annual Financial Statements • Annexures

11. Pratical exercise to follow…… Discussion & Questions?

12. Reputation promise/mission The Auditor-General 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.