SAHRA Presentation to the
Arts and Culture Parliamentary
Portfolio Committee
Presented By:
Ms Mmabatho Ramagoshi
Acting CEO
20 March 2013
1
Table of Contents
• Introduction
• Progress report:
– Turnaround Strategy
– Disclaimer Audit Report
– Status of the assessment of PHRAs and
recommendations for a different approach.
2
Introduction
•
During October 2012 SAHRA presented a report to the Portfolio Committee outlining
the challenges faced by the entity, which have resulted with a disclaimer audit report
for the 2011/12 financial year.
•
The presentation also outlined the intervention strategies which the Council
committed to implementing to address the dysfunctional state of the entity.
•
The purpose of this presentation is therefore to report on progress made to date since
the commitments were made to the Committee.
3
Progress: Intervention and turnaround
•
Setting up of a Turn-Around Task Team involving DAC, sister institutions that
have good record of performance in identified areas.
Progress to date:
•
•
The team was duly set up with DAC. They played a pivotal role in assisting with
the drafting of the ENE for 2012/13 , the filling of the CFO Post and the drafting of
the Terms of Reference for the appointment of a team of Accounting Professionals
to assist with the turnaround the financial management of the SAHRA.
Appointment of Staff in all key vacancies
Progress to date:
–
–
–
–
–
–
–
–
•
Acting Chief Executive Officer and Head of Turnaround strategy – Ms
Mmabatho Ramagoshi
Corporate Affairs Executive – Ms Mamakomareng Nkhasi
Company Secretary – Ms Lungisa Malgas
IT Technician – Mr Luvo Mbaru
Chief Finance Officer – Ms Cathy Motsisi
Heritage Officer, Objects – Ms Lynn Abrahams
Heritage Officer, Built Environment – Ms Shaneegh Bruce
Heritage Officer, APM – Ms Jenna Lavin
4
Progress: Intervention and turnaround
•
Development of a comprehensive Audit Plan working closely with the AG.
Progress:
•
•
•

The audit was developed and presented to the Council and Auditor General.
Progress on clearing the audit findings was presented to the Audit Committee and
AG.
We continue to monitor the action plan internally during the executive meetings
Appointment of the implementation teams and critical support people
Progress:

The following bids were advertised for the appointing of experts to assist
the entity:
 Financial Capacity to implement sound financial management
 Organizational Design specialists
 Property Management strategy
 Forensic Audit

The appointment process is almost at the finalization stages. We are envisaging
to have the teams on board before the end of March.
5
Progress: Intervention and turnaround
•
Performance Management
Progress
–
–
–
•
We have acquired a performance management system which is a module to
current VIP system used HR and Payroll management.
The current excel spreadsheet will be used for performance management while
the system is being tested for effective transition.
There is a concerted effort to compile and sign off the 2012/13 performance
agreements for all staff. The process started in February and will be completed
before end March.
Governance and culture change
Progress
–
–
–
During February a team building session was undertaken by all employees and
management of SAHRA. This initiative was a build up towards the culture change
processes that will be taking place to turnaround the entity. The sessions created
a platform for constructive criticism with staff on issues that negatively affected
performance.
We are in the currently implementing some of the recommendations from the
sessions.
The OD project that will commence end of March will further enable the
organization to have a structure that is aligned to the strategy and mandate of
the SAHRA.
6
Progress: Intervention and turnaround
•
Supply Chain Management
Progress
–
–
–
•
The policy for Supply Chain has been approved and work shopped with all staff
We have appointed contract workers to assist while the OD process is unfolding.
The team will be further strengthened by employing interns.
We are now analysing the previous years transaction to identify irregular and
fruitless expenditure incurred in previous years.
Budget and Expenditure Management
Progress
–
–
–
–
The monthly financial performance is presented to EXCO monthly
The ENE was approved by the Council and submitted to DAC
We are currently analysing the Projects budget to make informed decisions on
decommissioning some of the bank accounts.
We are also investigating improved investment options in order to maximise on
returns on investments.
7
Audit Findings Action Plan
Action
Activities
Completion
Date
16 Jan
Done
16 Jan
Done
20 Jan
Done
Evaluate, Adjudicate
26 Feb
Done
Submit recommended
Accounting Firm to Council
Commencement of the
Project
Review the draft Policies
18 Mar
Work in Progress
26 Mar
Not yet due
Create capacity within the Develop Terms of Reference
Finance Section by
appointing an Accounting Establish the Bid and
Firm
Evaluation Committees
Advertise the Bid
Develop Financial and
SCM Policies
28 Feb
Progress
Done
Re-submit to Council for
approval
Load on Intranet
Done
Workshop all staff on all the
Policies
Done
Done
8
Audit Findings Action Plan cont.
Action
Activities
Develop the
Review the current drafts
Delegations of
and enhance
Authority for Financial
Re-submit to the Audit
Management
Committee and Council for
approval
Workshop all staff on all the
Policies
Completi
on Date
28 Feb
Progress
Done
The draft delegations which
have been accented to by
the CEO and Executives
have been submitted to the
Audit Committee for
approval. They will be
presented at the next
special Council meeting
before end March.
Done
9
Audit Findings Action Plan cont.
Action
Activities
Comple
tion
Date
Progress
Alignment of
AccTech consultant to get
SCOA with
Iziko’s chart of accounts and
National
compare with SAHRA’s one.
treasury Due 28
February 2013
31 Jan
Done.
Meeting to identify gaps and
align ACCPAC chart of
Accounts with the National
Treasury annual financial
statement template
28 Feb
Done. We are currently
working closely with
ACCTECH to map the
template for easier
compilation of the AFS.
Finalize SCOA for
implementation
20 Mar
In progress
10
Audit Findings Action Plan cont.
Action
Review of
Journals
Activities
Submit all journals for
the period AprilDecember 2012 CFO for
approval
Completion
Date
26 Mar
Progress
Journal dating back to April 2012
were reviewed by the CFO. Those
that were correct were approved
for processing. The petty cash
journal were referred back for
further information.
Submit all current
journals for approval
Ongoing
All current journals are submitted
to CFO for approval.
Prepare year-end plan
15 Mar
Year end plan has been developed.
Leave arrangements with staff
during the audit has been agreed
upon. No one will take a block
leave until end of July.
11
Audit Findings Action Plan cont.
Action
Disclosure
errors and
opening
balance
corrections
Activities
Completio
n Date
28 Feb
Done
Summarize all
misstatements and
disclosure errors to be
analyzed for corrections.
Correct opening
30 Apr
balances and disclosure
errors
Identify all differences
26st Mar
Investigate
and document
all differences
for deferred
revenue.
Debtors
Conduct monthly
Management
reconciliations of
Debtors
31 Jan
Progress
In Progress. We have started with the
related party disclosure note.
In Progress. We are currently
analyzing all differences in order to
make corrections and prepare
evidence for prior year adjustments.
The Age analysis is reconciled
monthly. The Debtors balance as at
end Feb was R689,532,
(2011/12:677,986.70). This amount
includes the staff debtors of R108,850
which was an extrapolated amount
from the telephone debts. A separate
submission has been prepared for
Council to condone.
12
Audit Findings Action Plan cont.
Action
Debtors
Management
Cont.
Activities
Completio
n Date
Meeting with finance and
property section to map
business process
Progress
We have already started to
reconcile the information held
by Property Management with
Finance on a monthly basis.
A meeting is scheduled for 01
march 2013 to commence with
the reconstruction of the debtors
from 2009.
Do correcting entries to
rectify age analysis
05 Mar
Pending the reconstruction of
the debtors.
Prepare documentation
supporting un-reconciling
amounts between Age and
GL account.
05 Mar
We have completed the
investigation of the variance of
R1,316.40 between the ledger
and the age analysis. The
amount will be cleared by end
March.
Provision for bad debt will
be computed after March.
08 Apr
Not yet due
13
Audit Findings Action Plan cont.
Action
Activities
Develop
related party
policy and
procedure
Develop and submit for council
approval
Meeting with the legal unit to
discuss contingent liabilities for
AFS purposes.
Submit bank recons to CFO for
approval
Prepare schedule of all bank
accounts on Trial Balance with
recommendations for derecognition
Finalize the clearing of debit
balances
Submit reconciliation of age
analysis and trade creditors to
CFO
Bank
reconciliatio
ns
Accounts
Payables
Completio
n Date
28 Mar
28 Mar
Progress
Draft policy developed as well
as declaration form.
Meeting scheduled for 26 March
2013.
7th of every
month
28 Mar
Bank Reconciliations submitted.
31 Mar
Completed.
28 Feb
Work in Progress. We have
started to reconcile the
creditor’s age analysis. Some of
the discrepancies have already
been resolved. The old
outstanding difference of R297
is currently being investigated.
Work in Progress. We are still
extracting supporting
information from custodians.
14
Audit Findings Action Plan cont.
Action
Payroll
Reconciliation
Records
Management
Activities
Completio
Progress
n Date
Submit monthly recons 7th of every Done on an ongoing basis.
to CFO
month
Consult with VIP on
22 Feb
Consultation done. As from March 2013
treatment of
pensioners medical aid will be processed
pensioners on the
via VIP system (Company
system
contributions).
Implement a control
system for issuing of
documents
26 Mar
We have already put in place a system
of recording all documents issued from
Finance.
One of the Officials in SCM has been
tasked to perform the function of
documents control officer.
Improve the filing and
safeguarding of
documents
26 Mar
In Progress. Interns will be appointed
by the end of March to assist with filing
and safe storing of documents.
Implement the
approved File Plan for
storing documents
01 May
Not yet started.
15
Audit Findings Action Plan: Movable Assets
Action
Activities
Asset

movement and
records

keeping


Assets
verification


Design the asset
movement form
Communicate the
forms to all staff
Load the form on
Intranet
Implement the
usage of forms
Completio
n Date
28 Feb
Done.
28 Feb
Done
28 Feb
Done
31 Mar
Training and awareness workshops
were conducted on the 7th and 8th
March. The implementation is due
from 11th March.
Finalize the Head
31 March
Office, Western
2013
Cape and Pretoria
Satellite Offices
Bar code all assets
Progress
90% complete
16
Audit Findings Action Plan: Movable Assets
Action
Bar coding
system/ software
Capitalization of
Assets
Update the Asset
Register
Activities
Research on the feasible
bar coding system
Engage ACCTECH on the
bar coding system which
is compatible to ACCPAC
Capitalize assets on a
monthly basis starting
from January 2013
Compl
etion
Date
Progress
31 Mar
In progress working closely with the ACCTECH
consultants regarding the options that we may use.
31 Mar
All assets acquired since April 2012 now been
capitalized and updated in the asset register.
Remove obsolete/
15 Mar
redundant/missing/
broken asset.
Create location on the
26 Mar
Asset Register and
responsibility of
custodians
Ensure that every location
has an Inventory list
attached to the back of
the door
We have also, adopted a business process that will
enable the asset officer to proactively identify
capital assets for correct allocation in the ledger as
well as updating of the register.
Not yet done
Work in progress- The draft verification report has
been sent to the ACCTECH specialists in order for
them to create the location and responsibilities as
per the verified assets.
In progress. Awaiting the above process which
should be completed by 26 March.
17
Audit Findings Action Plan: Movable Assets
Action
Update the
Asset Register
cont.
Activities
Completi
on Date
Progress
Review the existing asset
management Policy and
procedures
Draft the Disposal Policy
28 Feb
In progress
30 Mar
Not yet done
Finalize and submit both Policies
for approval
Submit all supporting
documents as per the finding on
the disposals which took place.
30 Mar
Not yet done
30 Mar
Work in progress. Out of the R10,7 million
that was reported R6,359 mil has been
resolved. We are continuing to verify the
other journals. The bulk were additions,
correcting journals between software,
consultants and intangibles ledgers.
Analyze the discrepancies in the
opening balances
Implement corrections on
AccPAC
Review all prior year journals
The analysis has been done. We are
currently implementing the
recommendations. The accounting firm
that is going to be appointed will be
expected to assist in validating the
conclusions made and corrections
proposed.
Ongoing as the issues are resolved.
Work in progress. Almost 30% of the
journals have been reviewed.
18
Audit Findings Action Plan: Supply Chain Management
Action
Review the
irregular
expenditure
register
Activities
Review the
entire
Population
for 2010/11,
2011/12,
2012 /13
Completio
n Date
20 Mar
Progress
Irregular expenditure relating to the period
2011/12 AND 201/13 up to December has
been reviewed and submitted to council for
approval of recommendations.
Council has approved to condone cases where
only one quotation was sourced as the internal
policy during that period directed as such.
All other cases were referred back for
managers to give written reports or take
corrective action.
to engage the responses from managers. A
new report will be compiled for council
approval.
We are currently reviewing the Dec and
January transactions to identify any irregular
or fruitless expenditure which was not
reported.
19
Audit Findings Action Plan: Supply Chain Management
Action
Review the Fruitless
and Wasteful
expenditure analyze
each case and
recommend action
Activities
Review the entire
Population for
2010/11, 2011/12,
2012 /13
Completion
Date
20 Mar
Progress
Out of the R267,000 reported
R13,453.00 has been condoned.
The balance of R253,801 relates
to interest and penalties which
were never resolved in the
previous years. We are
currently reviewing all
transactions from 2009 to
identify cases that were not
reported as well as to ensure
complete reporting in the AFS.
20
Audit Findings Action Plan: Supply Chain Management
Action
Update the SCM
Policy and
Delegations and
submit for
Approval by
Council
Implement the
use of Purchase
Order on ACCPAC
Improve the
Supplier Data
Base
Activities
Identify Gaps as highlighted
by the audit report and
update the Policy
Update the Policy with the
latest Prescripts from NT.
Submit the Policy to the
Council for Approval
Obtain training from
ACCPAC
Completi
on Date
30 Jan
Done
Progress
30 Jan
Done
30 Jan
Done
25 Feb
Done
Advertise to get more
suppliers on the database
22 Feb
Supplier Database was
advertised on two National
newspapers. The accreditation
will take place in April/
Design the supplier rotation
Form to encourage and
monitor the use the of same
suppliers
Research the possibility of a
Vendor Management System
01 Mar
Design in progress. The form
will be finalized for
implementation by 12 March.
31 May
Work in progress. The support
of IT has already been enlisted
to identify a suitable system.
21
Audit Findings Action Plan: Supply Chain Management
Action
Improve
compliance
Contract
Management
Activities
Completi
on Date
Progress
Develop an SCM checklist for all
processes and implement by end
Mar.
28 Mar
Work in Progress. The Bid Committee,
Procurement check l and Evaluation
check lists completed. The payment
and logistics check list will be
completed by due date.
Develop business processes
30 June
Not yet started
Develop a Bid Adjudication and
Evaluation Hand Book
30 June
Work in progress. The bid adjudication
hand book is 80% completed.
Develop a Template for the
Procurement Plans
28 Feb
Done. The template has already been
workshopped with the HRM unit.
It will be loaded on intranet by the
26th February. The other units will
receive on 27th Feb.
Develop a Deviations and Bids
awarded Register
6 March
2013
Done.
Train all relevant staff on the SCM
Policy and Delegations
Investigate a scanning solution for
all
contracts
Develop an SCM contract register
and update all contracts monthly
15 Mar
Training is scheduled for 7- 8 March
30 June
Work in progress In- Progress
Purchase of a Scanner is in progress
terms of reference has been issued.
Done.
6 March
2013
22
CURRENT STATUS OF THE ASSESSMENT OF PHRAs
Following the approval of the Assessment Policy by the SAHRA Council in March 2011, the following
PHRAs were re-assessed.
EASTERN CAPE
• The ECPHRA was re-assessed in August 2011 and found competent to perform some functions.
Those functions which they were not competent SAHRA has signed an urgency arrangement to
perform these functions on their behalf.
NORTHERN CAPE
• The PHRA was re-assessed on the July 2012 and found competent to perform some functions
and SAHRA will perform some functions on their behalf. Those functions which they were not
competent SAHRA has signed an urgency arrangement to perform these functions on their
behalf.
Free State
The PHRA was re-assessed on the July 2012 and found competent to perform some functions.
Those functions which they were not competent SAHRA has signed an urgency arrangement
with to perform these functions on their behalf.
North West
The provincial representative who served in the SAHRA Council resigned and there is no
provincial representation. The province has asked for nominations to serve in the PHRA
Council.
CURRENT STATUS OF THE ASSESSMENT OF PHRAs
•
Limpopo
A PHRA was established but no representation in SAHRA Council as required by the
National Heritage Resources Act of 1999. The PHRA has completed a re-assessment
application March 2013 and would not assume any function therefore SAHRA will
perform these on agency basis.
•
Mpumalanga
The Department of Sports, Recreation, Arts and Culture seconded staff to PHRA.
Present term of Council has been extended.
Gauteng
Council appointed and sent an application for re-assessment March 2013 and will
take over functions except highly specialised areas like archaeology, palaeontology
and meteorites.
Western Cape
The HWC (PHRA) was re-assessed in October 2011 and authenticated competent to
perform all functions except Section 36 Burial Grounds and graves.
KZN
Competent and capacitated PHRA. SAHRA re-assessed Amafa June 2012 and found
them competent but no representation in the SAHRA Council
•
•
•
It is important that respective MEC’s be urged to
establish PHRAs and provide at least minimum
resources for their operations.
24
Summary & conclusion
•
There is a concerted effort from the Council and Executives to reverse the dysfunctional
state of SAHRA and aim for an unqualified audit and ultimately clean audit. SAHRA is working
closely with the AG and DAC in resolving these challenges.
•
The SAHRA historical structural and resource weaknesses will finally be addressed through
the comprehensive organizational design project which is soon to start.
•
SAHRA at this juncture has the best possible chance of turning-around and rising to the
challenge of fulfilling its nationally significant mandate of promoting, preserving and
protecting our national heritage estate.
25
I Thank You!
26