2011 – 2012 Audit Expectations
May 2012
Reputation promise/mission
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.
2
2010 – 2011 Audit Outcomes
Audit Opinion
3
Number of Municipalities
Financially Unqualified CLEAN
2
Financially Unqualified with
other matters
3
Financially Qualified with other
matters
12
Adverse
4
Disclaimer
9
2011-2012
EXPECTATIONS FROM THE AGSA
4
Availability of personnel
1.
2.
3.
4.
5.
6.
5
Availability of CFOs
Availability of finance personnel
Availability of Municipal managers
Availability of section 56 and 57 managers
Availability of technical services personnel
Availability of human resource personnel
Financials and related schedules
•
•
Approved financial statements prepared in terms of the GRAP
accounting framework, (Manual and Electronic) submitted by the 31
August 2012.
Referenced working paper files that that has supporting documents
for each Note to the financial statements as per MFMA Circular 50.
(Manual and Electronic)
• All journals must be accompanied by valid (appropriate and
sufficient) supporting documentation
6
Audit of performance objectives (AoPO)
•
•
•
•
•
•
•
•
7
IDP 2011/12
SDBIP 2011/12
Reviewed Quarterly performance reports
Mid-year budget and performance assessment report
Performance management policies/procedures
Consolidated service delivery quarterly reports which are aligned to
the IDP and SDBIP with targets, actual and explanation for variances
Draft Annual 2011/12 Report with Performance information (Manual
and Electronic) (TO BE SUBMITTED WITH AFS ON 31 AUGUST 2012)
Supporting documents for actual performance reported in annual
performance report and reasons for not achieving targets
GRAP STANDARDS
GRAP 17 and 16 – PPE and investment properties
• Calculation of depreciation
• Fair value of assets
• Residual values
• Estimation of useful lives
• Correct application and identification of investment properties
GRAP 13 - Leases
• Consistent application of leases
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GRAP STANDARDS
GRAP 19 – Provisions, contingent liabilities and contingent assets
• Provision for land fill site
• Provision for leave
• Provision for Bonuses
• Provision for Long service awards
• Provision for long term leave
• Employee benefits (Defined contribution or benefit plans)
9
WATER AND SOLID WASTE RELATED
TRANSACTIONS AS PER APPROVAL BY THE
MINISTER
Local Municipalities
• Transactions will be audited here
• Movements for the year will be audited here
• Journals transferring balances at year end should be supported
District Municipality
• Signed SLAs must exist for each local municipality
• Accounting of water related transactions should be in line with the
stipulations of the SLA
• Water reticulation losses are responsibility of the District municipality.
• All balances taken over from the locals MUST be supported by
reconciliations that tie up with the local’s balances.
• Balances should be supported by printouts of monthly billings and
debtors age analysis taken over from the local municipalities (last
pages of the printouts or reconciliations will suffice)
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