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2012/13 Annual Report: Arts and Culture Budget and Expenditure

This report provides a detailed explanation of the budget and expenditure for the Department of Arts and Culture in the fiscal year 2012/13. It includes information on performance, key indicators, and expenditure per economic classification.

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2012/13 Annual Report: Arts and Culture Budget and Expenditure

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  1. 2012/13 ANNUAL REPORT29 JAN 2014 Sibusiso Xaba Director-General: Arts and Culture

  2. Budget and expenditure Explanation of expenditure per economic classification Human Resource Management Report Report of the Audit Committee Report from the Auditor-General Performance overview Performance against key indicators PRESENTATION OUTLINE 2

  3. SUMMARY OF BUDGET PER PROGRAMME AND ECONOMIC CLASSIFICATON 3

  4. EXPENDITURE PER PROGRAMME 4

  5. EXPENDITURE PER ECONOMIC CLASSIFICATION 5

  6. EXPLANATION OF EXPENDITURE PER ECONOMIC CLASSIFICATON 6

  7. Compensation of Employees • An amount of R172,733,000 has been spent as at 31st March 2013

  8. Goods and Services • An amount of R313 million (99.3%) as at 31st March 2013, which excludes payments for financial assets • The saving is due to advertisement of tender for the costing of Community Library Bill delayed

  9. Households • This expenditure item relates to all the financial assistance projects that the Department funds during the financial year • An amount of R158 million (97.2%) has been spent as at 31st March 2013 • The reason for non payment of the three projects of Mzansi Golden Economy (MGE) was due to expired tax clearance certificate, banking details rejected by safety web and payment submitted after system closure

  10. Capital Assets/Machinery and Equipment This budget relates to the purchasing of machinery and equipment including the ICT equipment and heritage assets • An amount of R5,3 million (76.1%) has been spent as at 31st March 2013 which includes machinery and equipment, heritage and software and intangible assets • The reason for under-expenditure is the late delivery of invoices by the suppliers after year end closure

  11. Departmental Agencies & Accounts(Capital Works/Buildings & Other Fixed Structures) • An amount of R475 million (98,4%) has been spent as at 31st March 2013 • The under-expenditure is due to projects that were not implemented, i.e. two digital screens projects by the NFVF 11

  12. Non-Profit Institution, Agencies & Accounts (Subsidies) and Conditional Grant • 100% of budget has been spent/transferred as at 31st March 2013 • The detail of the Conditional Grant and reasons for variance by Provinces are as follows: 12

  13. PROVINCES AND MUNICIPALITIES(CONDITIONAL GRANT ON COMMUNITY LIBRARIES) 13

  14. PROVINCES AND MUNICIPALITIES(CONDITIONAL GRANT ON COMMUNITY LIBRARIES) Variances by Provinces: 14

  15. PROVINCES AND MUNICIPALITIES(CONDITIONAL GRANT ON COMMUNITY LIBRARIES) 15

  16. PROVINCES AND MUNICIPALITIES(CONDITIONAL GRANT ON COMMUNITY LIBRARIES) 16

  17. PROVINCES AND MUNICIPALITIES(CONDITIONAL GRANT ON COMMUNITY LIBRARIES) 17

  18. PROVINCES AND MUNICIPALITIES(CONDITIONAL GRANT ON COMMUNITY LIBRARIES) 18

  19. DEPARTMENTAL AGENCIES ACCOUNTS (CURRENT TRANSFERS)

  20. DEPARTMENTAL AGENCIES ACCOUNTS (CURRENT TRANSFERS) • 100% of the subsidies paid over to the various Playhouses, Heritage Institutions, Libraries and PanSalb 20

  21. PERFORMING ARTS INSTITUTIONS 21

  22. HERITAGE INSTITUTIONS 22

  23. HERITAGE INSTITUTIONS 23

  24. LIBRARIES 24

  25. NON PROFIT INSTITUTIONS • 100% of the budget which relates to the subsidies of BASA, Blind SA and the Engelenburg House Art Collection and funds has been transferred as follows: 25

  26. HOUSEHOLDS • Expenditure was at 99.5% as at the end of March 2013. The detail is as follows: 26

  27. DEPARTMENTAL AGENCIES ACCOUNTS (CAPITAL TRANSFERS)

  28. DEPARTMENTAL AGENCIES ACCOUNTS (CAPITAL TRANSFERS) 28

  29. DEPARTMENTAL AGENCIES ACCOUNTS (CAPITAL TRANSFERS) 29

  30. DEPARTMENTAL AGENCIES ACCOUNTS (CAPITAL TRANSFERS) 30

  31. DEPARTMENTAL AGENCIES ACCOUNTS(CAPITAL WORKS/BUILDINGS & OTHER FIXED STRUCTURES) 31

  32. HUMAN RESOURCE MANAGEMENT REPORT 32

  33. Human Resource Information 33

  34. Human Resource Information 34

  35. Human Resource Information Employees with disabilities: 7 (1.6%) 35

  36. Human Resource Information Number of Internship Opportunities provided: 22 36

  37. REPORT OF THE AUDIT COMMITTEE 37

  38. REPORT OF THE AUDIT COMMITTEE The Department had in place a fully effective: Internal Audit function - in line with the provisions of section [Sections 38(1)(a)(ii); 76(4)(e) of the PFMA]; [Treasury Regulation 3.2]; and Audit Committee - in line with the provisions of section 38(1)(a)(ii); 76(4)(d) and 77 of the PFMA] of the PFMA, and Treasury Regulation 3.1; Membership, Attendance & Responsibilities: Audit Committee (Committee)operated in accordance with, and complied with its approved Audit Committee Charter, adopted as its formal written Terms of References: The Committee comprised 5 members during the year, and held 6 meetings; 38

  39. REPORT OF THE AUDIT COMMITTEE The Committee fulfilled its oversight responsibilities through the meetings held (in which various reports and information were tabled before it); and assisted the Accounting Officer to ensure that the Department has and maintains effective, efficient and transparent systems of financial, risk management, governance, and internal control by: Supporting management in respect of financial reporting and a system of internal control; Enhancing business ethics and trust in the Department; Ensuring and enhancing the independence of the Internal Audit Activity; Ensuring that risks facing the Department are identified and that appropriate procedures are implemented to manage and minimize risks; Ensuring the proper functioning of both the internal and external audit processes, and other assurance services, including investigation activities. Monitoring compliance with laws and regulations and the code of conduct. 39

  40. REPORT FOR THE AUDIT COMMITTEE b. Effectiveness of Controls The Committee noted that the systems of internal control were not fully effective from the Department’s Internal Audit reports and the report of the Auditor General as follows: internal control deficiencies; deviations from business rules; and recurring deficiencies from prior years. Matters of serious concern to the Committee were as follows: Lack of adequate policies and procedures in general; Non-compliance to policies and procedures; Lack of adequate Supply Chain Management policies, procedures, and compliance there-to; Contract and records management; The inadequate capacity and turnaround, in particular the filling of the CFO position; Performance on Pre-determined objectives. 40

  41. REPORT FOR THE AUDIT COMMITTEE c) Quality of in-year monitoring and monthly/quarterly reports : The Committee is satisfied with :- • the content and quality of monthly and quarterly reports prepared and issued by the Accounting Officer during the year under review; and • has noted improvements during planned meetings held during the 2012/2013 financial year on • Asset Management; and • The formulation of the Predetermined Objectives. d) Evaluation of Financial Statements • The Committee reviewed and discussed the audited Annual Financial Statements with AG-SA and Accounting Officer, and concurs and accepts conclusion thereof. • The Committee also met with the AG-SA, to ensure that there are no unresolved issues.

  42. REPORT FROM THE AUDIT COMMITTEE • Internal Audit • The Committee was satisfied:- • that a Chief Audit Executive was appointed prior to the end of the financial year, • that the Internal Audit function through its outsource arrangement addressed risks pertinent to the Department in its audits, and • that resulting reported opinions were independent and in full compliance with the approved Internal Audit Charter. • The Committee considers the internal audit function to be under-resourced and therefore cannot function optimally given its current resources and budget to cover all critical risks prioritised in its plan. The Committee has consistently reminded Management about the need for: • improved controls and governance systems, • compliance to the legislation, policies and procedures.

  43. Annual Report – AG report and details of Irregular, Unauthorised and Fruitless and wasteful expenditure

  44. REPORT FROM THE AUDITOR-GENERAL Opinion Unqualified Audit Report Attention was drawn on the following Performance information (predetermined objectives), not all planned targets were achieved. Findings, however, represents an improvement from previous year’s findings; Material adjustments to the annual performance report and were adjusted; Procurement and contract management system were inadequate; Human resources management and compensation were inadequate; Inadequate systems to prevent Irregular Expenditure; and Poor controls to ensure compliance with SCM requirements and lack of oversight responsibility. 44

  45. UNAUTHORISED EXPENDITURE 45

  46. IRREGULAR EXPENDITURE 4

  47. IRREGULAR EXPENDITURE 47

  48. FRUITLESS AND WASTEFUL EXPENDITURE 48

  49. FRUITLESS AND WASTEFUL EXPENDITURE (CONT…) 49

  50. Performance Overview

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