2015/16 POST AUDIT DEBRIEF CFO Forum: National

Summary of audit outcomes – 2015/16 Audit of AFS : Departments as at 11 August 2016<br>

Summary of audit outcomes – 2015/16 Departments with “clean” audit outcomes on all 3 areas:<br>

Summary of audit outcomes – 2015/16 To date 4 departments received a qualified audit opinion:
[International Relations and Cooperation; Civilian Secretariat for Police; Military Veterans; Environmental Affairs]

Qualification matters:
Accruals: The department could not provide sufficient appropriate audit evidence and therefore the adjustments could not be justified.
The department did not have adequate systems in place to maintain records of accruals where goods have been received or services have been rendered.
Receivables: Department did not present receivables in accordance with the MCS some amounts did not meet the definition of receivables resulting in overstatement.
Movable Tangible Capital Assets: The department could not provide sufficient appropriate audit evidence that the department had accounted for all movable tangible capital assets due to limitations in the asset register.<br>

Summary of audit outcomes – 2015/16 Qualification matters: (continued)

Heritage assets: Comprehensive assessment of all works of art and painting not done impacting the classification of Heritage Assets

- Movable Tangible Capital Assets and Minor assets: Did not maintain updated asset register for tangible capital assets and minor assets.<br>

Summary of audit outcomes – 2015/16 Predetermined Objectives

Material findings raised:
Material misstatements identified on the Annual Performance Reports submitted for auditing on the reported performance information
Significantly important targets not specific
Performance of significantly important targets could not be measured
Significantly important indicators not well defined.
Significantly important indicators not verifiable.
Significantly important targets not reliable when compared to the source information or evidence provided.
Adequate and reliable corroborating evidence could not be provided for a significantly important target to assess the reliability of the reported performance information.<br>

Summary of audit outcomes – 2015/16 Predetermined Objectives (continued)

Targets not reliable due to lack of sufficient appropriate audit evidence
Reported objectives and targets not consistent with those in the approved strategic plans and annual performance plan.<br>

Summary of audit outcomes – 2015/16 Compliance to Laws and Regulations
Material findings raised:
Employees were appointed without following a proper process to verify the claims made in their applications in contravention of Public Service Regulation 1/VII/D.8.
Lack of effective, efficient and transparent systems of risk management and internal controls within the departments.
Effective steps not taken to prevent unauthorised, irregular and fruitless and wasteful expenditure.
Effective and appropriate disciplinary steps not taken against officials who made or permitted the above expenditure.
AFS submitted for auditing not prepared in accordance with prescribed financial reporting framework.<br>

Summary of audit outcomes – 2015/16 Compliance to Laws and Regulations (continued)
Goods and services with a transaction value below R500 000 procured without obtaining the required price quotations
Goods and services of a transaction value above R500 000 procured without inviting competitive bids, TR16A6.1
Contracts were awarded to bidders who did not submit a declaration of past supply chain practices such as fraud
Quotations awarded to bidders who did not submit a declaration on whether they are employed by the state or connected to a person employed by the state which is not in compliance with Treasury regulation 16A8.3.
Invitations for competitive bidding were not always advertised for a required minimum period of 21 days
Sufficient appropriate audit evidence could not be obtained that contracts and quotations were awarded to bidders based on points given for criteria that were stipulated in the original invitation for bidding and quotations<br>

Summary of audit outcomes – 2015/16 Compliance to Laws and Regulations (continued)
Lack of effective internal controls for payment approval and processing.
Contractual obligations and money owed by the department not settled within 30 days or an greed period.
Effective and appropriate steps not taken to collect all money due to the department
Proper control systems to safeguard and maintain assets not adequately maintained.
Expenditure for programmes not monitored in accordance with the framework for allocation as required by Dora.
Money was borrowed through a commercial bank forex settlement account without the approval of the Minister of Finance or an official authorised by the Minister , in contravention of sec 66(1)(a) of the PFMA.<br>

EMERGING MATTERS REQUIRING ATTENTION OF DEPARTMENTS<br>

EMERGING MATTERS REQUIRING ATTENTION OF DEPARTMENTS<br>

EMERGING MATTERS REQUIRING ATTENTION OF DEPARTMENTS<br>

Summary of audit outcomes – 2015/16 THANK YOU 16<br>