PUBLIC FINANCE
MANAGEMENT ACT
AND
TREASURY
REGULATIONS
KEY OBJECTIVES OF
THE PFMA
• Modernise the system of financial
management
• Enable public sector managers to
manage, but at the same time to be
accountable
• Ensure timely provision of quality
information
• To eliminate waste and corruption in
the use of public assets
NATIONAL TREASURY
[SEC 6 (1) & (2)]
Promote and enforce transparency and
effective management in respect of revenue,
expenditure, assets and liabilities
Must prescribe uniform Treasury norms and
standards
Must enforce the PFMA and any prescribed
norms and standards
May assist departments in building capacity for
efficient, effective and transparent financial
management
May investigate any system of financial
management and internal control in any
department
RESPONSIBILITIES OF
ACCOUNTING OFFICERS
(SEC38)
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Must ensure that the department has and maintains
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Responsible for the effective, efficient, economical
and transparent use of resources of the department
Must take effective and appropriate steps to
prevent unauthorized, irregular and fruitless and
wasteful expenditure and losses resulting from
criminal conduct
Must take effective and appropriate disciplinary
steps against any official who
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Effective and efficient systems of financial and risk
management and internal control
A system of internal audit under control of an audit
committee
An appropriate procurement and provisioning system which
is fair, equitable, transparent and cost effective
Commits an act which undermines the financial
management and internal control systems
Makes or permits an unauthorized, irregular or fruitless and
wasteful expenditure
Delegate in writing any powers or duties to an
official in the department
RESPONSIBILITIES OF
OTHER OFFICIALS (SEC45)
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Must ensure that the system of
financial management and internal
control established for that department
is carried out
Is responsible for the effective and
efficient use of financial and other
resources
Must take effective and appropriate
steps to prevent unauthorized,
irregular and fruitless and wasteful
expenditure
Is responsible for the management,
including safeguarding of the assets
within that officials responsibility
FINANCIAL MISCONDUCT
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An accounting officer commits an act of
financial misconduct if willfully or
negligently fails to comply with a requirement
of sec 38
An official of a department to whom a power
or duty is assigned in terms of section 44
commits an act of financial misconduct if
willfully or negligently fails to exercise that
power or perform that duty
An official of a treasury to whom a power or
duty is assigned in terms of section 10
commits an act of financial misconduct if
willfully or negligently fails to exercise that
power or perform that duty
An accounting officer is guilty of an offence
and liable on conviction to a fine or to
imprisonment for a period not exceeding five
years, if that accounting officer willfully or in
a grossly negligent way fails to comply with a
provision of section 38
TREASURY
REGULATIONS
• Chief Financial Officer (Chapter 2)
• Establish an audit committee (Chapter 3)
• Establish an internal audit unit (Chapter 3)
• Accounting officer must facilitate regular risk
assessments (Chapter 3)
• Develop and implement a fraud prevention plan
(Chapter 3)
• Revenue management (Chapter 7)
• Expenditure management (Chapter 8)
• Asset management (Chapter 10)
• Banking and cash management framework (Chapter
15)
PROCUREMENT SYSTEM
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Accounting Officer must ensure that his
department has and maintains an appropriate
procurement and provisioning system (Sec
38)
Cabinet resolved that national & provincial
tender boards should be phased out.
Accounting Officers must accept
responsibility and accountability for AD HOC
tenders
Accounting Officer must submit procurement
procedures to national treasury for
accreditation
Preferential Procurement Policy Framework
Act (no 5 of 2000) requires that criteria to be
applied during evaluation and adjudication
must form part of tender documents.
Procurement reforms aims to strengthen
accountability, ensure a fair and open system
and to prevent corruption
DEPARTMENTAL PFMA
IMPLEMENTATION
PLANS
• Submission date 31 August 2000
• Appointment of chief financial officer
• Delegation of powers and assignment of duties
• Establishment of internal audit function
• Risk assessment
• Review of departmental prescripts (procedures and
processes)
• Training of managers on generic financial
management responsibilities
• Development of strategic plans (2002/3)
• Compliance with reporting standards (2000/2001)