the south african experience presented by the office of the auditor-general republic of south africa...
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The South African Experience
Presented by the Office of the Auditor-General
Republic of South Africa
Coping with Challenges
National Departments and their
related entities
Provincial Departments and their
related entities (health and education
predominately delivered at this level)
Municipalities
South African Context
Mandate of the Auditor-General :
Standard setting
Determined by the Auditor-
General
In line with INTOSAI and now also
IFAC
This has involved extensive
participation in the national and
international arena eg. Auditing
statements public sector
perspectives
Setting an Auditing Framework
Technical Advancement
Audit approach aligned with
recognised practice
Development of internal technical
guidelines and support
Setting an Auditing Framework
Technical Advancement (cont)
electronic working papers
training including SAICA and ACCA
Setting an Auditing Framework
Quality Assessment
Business Unit Level
Central Quality Reviews
External Practice Review
Setting an Auditing Framework
PARLIAMENT
GENERAL REPORTS ON AUDIT OUTCOMES AT
NATIONAL, PROVINCIAL AND LOCAL ENTITIES
ACTIVITY REPORT BY AUDITOR-GENERAL
Annual audit reports, included in annual
reports of National, Provincial and Local
entities
Audit activities
AUDITS BEING CONDUCTED
AUDITORS
SUMMARY OF AUDIT OUTCOMES
ANALYSES OF AUDIT ACTIVITIES
GENERAL REPORT FLOW TO PARLIAMENT
Guidance on Audit Reporting has been issued to the staff
Agreeing on where audit findings should be disclosed e.g. Management letter, emphasis of matter
Audit reports included in the annual reports of entities
General Report on Audit Outcomes
Consistency of audit findings
Predominately under the domain of
Provincial Government
Representing 69% of the total
Provincial expenditure
Health and Education Sectors
Reporting on audit opinions on the education sector
Province Expenditure Budget (Over)/Under-spending
2001-02audit opinion
2000-01audit opinion
R million R million R million
Eastern Cape
Free State
Gauteng
KwaZulu-Natal
Limpopo
Mpumalanga
Northern Cape
North West
Western Cape
TOTAL
7 865,6
3 173,9
7 268,5
9 270,7
6 330,7
3 330,9
1 021,8
3 972,1
4 273,2
46 507,4
8 118,9
3 382,2
7 507,0
9 346,6
6 340,9
3 346,9
1 028,4
4 029,5
4 339,2
47 439,6
253,3
208,3
238,5
75,9
10,2
16,0
6,6
57,4
66,0
932,2
Q
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Reporting on audit opinions on the health sector
Province Expenditure Budget (Over)/Under-spending
2001-02audit opinion
2000-01audit opinion
R million R million R million
Eastern Cape
Free State
Gauteng
KwaZulu-Natal
Limpopo
Mpumalanga
Northern Cape
North West
Western Cape
TOTAL
4 221,4
2 039,7
6 837,6
7 033,0
2 663,5
1 456,6
517,4
1 669,0
3 581,0
30 049,2
3 892,5
1 970,5
6 771,4
6 743,7
2 718,9
1 542,3
509,0
1 734,8
3 578,8
29 461,9
(328,9)
(587,3)
Q
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(69,2)
(66,2)
(289,3)
55,4
85,7
(8,4)
35,8
(2,2)
Transversal Report was conducted in the
education sphere some of the primary
findings:
The proportion of personnel
expenditure to total budget was in a
number of provinces in excess of the
national norm set by the Minister
Educators were found who were
beyond retirement age which was in
contravention of the regulations
Performance Audits of a Transversal nature
Transversal Report was conducted in the
education sphere some of the primary
findings:
Although a shortage of mathematics
and physics educators were
identified. The colleges who train
educators were not factoring this into
their policies and procedures
Performance Audits of a Transversal nature
Transversal Report was conducted in the
education sphere some of the primary
findings:
The issue of loss time for educators
through absenteeism was found
throughout
42% of educators were found to be
underqualified (against national
standards)
Performance Audits of a Transversal nature
Current Initiatives
There are numerous current
initiatives to further enhance and
improve our process and products.
This includes:
Compliance
Current Initiatives
Financial management/corporate
governance
Auditing of performance management
information
Current Initiatives
Audit Focus Areas these are:
Capacity
Control environment
Procurement
Current Initiatives
Audit Focus Areas cont:
Human Resource Management
Asset Management
Delivery of Basic services
PUBLIC SECTOR
FINANCIALS
OF A
A1
A2
A3
Cabinet Portfolio “A”
Private Sector
Current Issues cont. Sectorial Reporting
Current Initiatives
Centralised audit outcomes
information
Auditing transversal audit
outcomes
Auditing of performance
management information
Challenges Faced
Lack of operating framework at
provincial level
Need for improvement in
communication channels between
national, provincial and local
government. This is in respect of
auditees as well as auditors
Challenges Faced (continued)
Overall Governance Framework is not
adequate at the entities therefore it
is difficult to audit the real issues, for
example:
service delivery
corporate governance
Challenges Faced (continued)
Often purpose of auditors is to
provide an opinion on annual financial
statements, therefore, may not see
the bigger picture
Issues may be important transversally
may not warrant disclosure in
individual audit reports
More involvement of public account
committees
Vision for the future
Sectorial reports on the delivery of
services and financial management in
key sectors such as health and
education
Indication on whether the situation is
improving or not against a pre-set
criteria
THANK YOU