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IMFO CONFERENCE PRESENTER: CLAUDIA MAKWELA

IMFO CONFERENCE PRESENTER: CLAUDIA MAKWELA. OUTLINE. Purpose Challenges Role played by IA Value add Treasury guides. PURPOSE. To improve the integrity and quality of financial information reported in financial statements, in particular disclosure notes.

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IMFO CONFERENCE PRESENTER: CLAUDIA MAKWELA

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  1. IMFO CONFERENCE PRESENTER: CLAUDIA MAKWELA

  2. OUTLINE • Purpose • Challenges • Role played by IA • Value add • Treasury guides

  3. PURPOSE • To improve the integrity and quality of financial information reported in financial statements, in particular disclosure notes. • To reduce errors that are picked up and rectified during audit process • To address issues of operation clean audit 3

  4. PURPOSE • To improve audit outcome • To prevent late submission of AFS 4

  5. CHALLENGES A number of disclaimer opinion High number of qualified audit opinion Late submission of AFS Challenges on asset management Shortage of skilled personnel in finance Inability to address prior year issues raised by AG Material changes in the AFS 5

  6. CHALLENGES Incomplete disclosure notes Incomplete audit file 6

  7. CHALLENGES • Housing loan guarantees still reflecting the old financial institutions (e.g. Saambou bank) • Incomplete information on commitments and accrual • Classification of leases is a big issue • Adjustment column on assets note is populated with only balancing amounts – cannot be verified

  8. KNOWLEDGE • Knowing the institution’s operations, • Make use of FMCMM • Financial systems in use, • Knowing the legislations governing it, • Guidelines to draw budgets and AFS • Guidelines to report performance information • Continuous reading and commenting on draft documents • e.g Employment Equity Plan

  9. KNOWLEDGE • NT and PT practice notes/instruction notes • AFS Preparation guide • Use of AFS template

  10. ADDING VALUE • Internal controls • Review of action plan to address AG issues • Review financial statements • Make recommendations for improvements • Share new developments by the IIA • Share new developments from National and Provincial Treasury

  11. ADDING VALUE –AFS • Existence – audit during the year • Completeness – e.g. revenue, debtors, expenditure etc. • Correctness – capturing adjustment budget not original • Tally – economic classification to budget

  12. ADDING VALUE –AFS • Disclosures - Commitments and accruals - Contingent liabilities - Lease commitments - Employee benefits • Verifying totals and • Check notes correspondence • Interpretation of legislation

  13. ADDING VALUE –AFS Disclosures Irregular Expenditure Fruitless and wasteful expenditure Details thereof Minor assets Inventory management

  14. ADDING VALUE –PI • Targets reported according to APP • Alignment of targets and actual results e.g. Target – Prevent the spread of HIV Actual – Malaria reduced by 50% • Audit evidence should be available

  15. ADDING VALUE –PI

  16. AUDIT EVIDENCE GUIDE

  17. TREASURY GUIDES • Treasury Regulations • MTEF Guidelines • AFS framework guide • Annual report guidance • Framework for managing programme performance information (FMPPI), issued May 2007.

  18. CONCLUSION • IA operation plan • IFS review • Quarterly review of PI • AFS review

  19. THANK YOU

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