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2013-2014 Mid-year Budget and Performance Assessment 18 February 2014 Sustainable Development.

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Presentation on theme: "2013-2014 Mid-year Budget and Performance Assessment 18 February 2014 Sustainable Development."— Presentation transcript:

1 Mid-year Budget and Performance Assessment 18 February 2014 Sustainable Development

2 General Information on the Municipality Kareeberg Municipality is situated in the western side of the Pixley ka Seme District Municipality in the Northern Cape Province. The district consists of nine municipalities of which Kareeberg is the smallest. The municipality was established through the amalgamation of Carnarvon, Vanwyksvlei and Vosburg, as well as a large area of rural farms. Sustainable Development

3 General Information on the Municipality The administrative center is located in Carnarvon with Vanwyksvlei and Vosburg being rural service centers. The landscape is typical Karoo with an annual average rainfall of 260mm and an annual evaporation of 230mm. There are no constant rivers running through the municipal area and all towns are dependent on ground water. Sustainable Development

4 General Information on the Municipality Local economic opportunities are sadly lacking in the municipal area with the declining economy being largely based on sheep farming. With an unemployment rate of approximately 69,6% (Census 2011) most of the residents rely heavily on the provision of free basic services. (64% of consumers) Population has grown by 2,7 % over the period 2001 to Sustainable Development

5 General Information on the Municipality The migration of economically active residents to greater urban areas has a huge impact on the population growth. The total population in the municipal area is , which constitutes house- holds. 797 households (population 2 710), are resident in the rural areas whilst households (population 8 963) reside in the urban areas. Sustainable Development

6 Leadership MayorNico Titus CouncillorJurie Hoorn Councillor (PR)Jan Horne Councillor David Jason Councillor Dorothy Oliphant Councillor (PR)Ellen Riley Councillor (PR)Pienaar Viviers Sustainable Development

7 Leadership Municipal ManagerWillem de Bruin COMAlbertus van Schalkwyk CFOBrennan Rossouw Head Corp. ServicesCalla van Zyl Sustainable Development

8 Session 1 Review of Performance for the Financial Year Sustainable Development

9 Performance in the Financial Year 1.Audited Financial Performance against the original and revised Budget Sustainable Development

10 Performance in the Financial Year performance against IDP and SDBIP targets Sustainable Development a)Implement a Performance Management System b)Newsletters c)Oversee that training in terms of the Skills Development Plan is being implemented d)Reclaim all monies due i.t.o. Skills Development Plan. e)Ensure that the recommendations in the External Audit report is successfully implemented No official was charged with the task Insufficient funding received from LGSETA Although all the relevant documentation is submitted the exercise is worthless This is an ongoing process and recommendations are reviewed monthly. All the recommendations made by the AG have not been clarified and the Audit Action Plan has not been completed.

11 Performance in the Financial Year performance against IDP and SDBIP targets Sustainable Development f)4 Ward Committee meetings per annum g)The dumping of all waste at the waste sites and administering the maintenance of the dumping site. h)Manage maintenance of assets i)Manage the maintenance of the municipal vehicles fleet and equipment Only three per ward were held. A quorum for all meetings could not be obtained Although the waste sites have been tidied the community dumps refuse in a disorderly manner. Cash flow restraints hamper repair and maintenance

12 Performance in the Financial Year Auditor Generals report Qualified opinion In my opinion, except for effects of the matters described in the Basis for qualified opinion paragraphs, the financial statements present fairly, in all material respects, the financial position of the Kareeberg Local Municipality as at 30 June 2013 and its financial performance and cash flows for the year then ended in accordance with SA Standards of GRAP and the requirements of the MFMA and DoRA Sustainable Development

13 Performance in the Financial Year Audit Action Plan Sustainable Development ItemParticulars of Finding Impact of the finding on the Audit Report Action taken Responsible Person and Department Time Schedule Progress made 6 The municipality did not include particulars of all irregular expenditure in the notes to the financial statements as required by section 125(d) (i) and (ii) of the MFMA. The municipality made payments in contravention of the supply chain management requirements which were not included in irregular expenditure, resulting in irregular expenditure being understated by an amount of R Qualification Council wrote off the expenditure on 27 November The financial statements were corrected, but it was not accepted by the Auditor General. The main reason was misinterpretation of the regulations. Head: Finance 27 November The municipality did not include particulars of unauthorised expenditure in the notes to the financial statements as required by section 8(1) (a) the DoRA.. The municipality made payments in contravention of the of the conditions of the Financial Management and Municipal System Implementation grants and these payments were not included in unauthorised expenditure being understated by R QualificationAuthorisation for the payment of FMG was submitted on 27 November No answer was received from the Auditor General. Approved MSIG plan indicates the expenditure and conditions were met. The Auditor General did not accept this proof. Council will investigate the matter at the council meeting on 28 January Municipal Manager 31 March 2014

14 Performance in the Financial Year Audit Action Plan Sustainable Development ItemParticulars of Finding Impact of the finding on the Audit Report Action taken Responsible Person and Department Time Schedule Progress made 10 As disclosed in note 34 to the financial statements, the corresponding figures for 30 June 2012 have been restated as a result of errors discovered during 2013 in the financial statements for the year ended, 30 June Other matters Errors discovered by municipality itself and restatement done. See note As disclosed in note 16 and 17 of the financial statements, the municipality impaired receivables from exchange transactions to the value of R due to a measurable decrease in future cash flows since initial recognition. Other matters Provision of R was made for all debt greater than 30 days Cannot obtained the other information included in the annual report. Consequently not able to identify whether the other information to be included in the annual report contains any material inconsistencies to the information in the financial statements. Other matters This matter was never discussed. It is therefore unclear what is referred to. Auditor General 31 January 2014 Clearer reference was requested. 15The annual performance report was not presented for audit and consequently the findings are limited to the procedures performed on the strategic planning and performance management documents. Other matters A consultant started the process but has not been re- appointed to complete the task. MPAC recommended that council reconsider the appointment. Council28 January 2014

15 Performance in the Financial Year Audit Action Plan Sustainable Development ItemParticulars of Finding Impact of the finding on the Audit Report Action taken Responsible Person and Department Time Schedule Progress made 17The National Treasury Framework for managing programme performance information requires that the performance targets be specific in clearly identifying the nature and required level of performance. A total of 100% of the targets were not specific in clearly identifying the nature and required level of performance. This was due to the fact that management did not implement the requirements of the National Treasury Framework for managing programme performance information when the Integrated Development Plan was developed and is still in the process of correcting this in order to comply with the requirements. Other matters A consultant started the process but has not been re- appointed to complete the task. MPAC recommended that council reconsider the appointment. Council28 January 2014

16 Performance in the Financial Year Audit Action Plan Sustainable Development ItemParticulars of Finding Impact of the finding on the Audit Report Action taken Responsible Person and Department Time Schedule Progress made 18The National Treasury Framework for managing programme performance information requires that the performance targets be specific in clearly identifying the nature and required level of performance. A total of 100% of the targets were not specific in clearly identifying the nature and required level of performance. This was due to the fact that management did not implement the requirements of the National Treasury Framework for managing programme performance information when the Integrated Development Plan was developed and is still in the process of correcting this in order to comply with the requirements. Other matters A consultant started the process but has not been re- appointed to complete the task. MPAC recommended that council reconsider the appointment. Council28 January 2014

17 Performance in the Financial Year Audit Action Plan Sustainable Development ItemParticulars of Finding Impact of the finding on the Audit Report Action taken Responsible Person and Department Time Schedule Progress made 19The National Treasury Framework for managing programme performance information requires that the performance targets be specific in clearly identifying the nature and required level of performance. A total of 100% of the targets were not specific in clearly identifying the nature and required level of performance. This was due to the fact that management did not implement the requirements of the National Treasury Framework for managing programme performance information when the Integrated Development Plan was developed and is still in the process of correcting this in order to comply with the requirements. Other matters A consultant started the process but has not been re- appointed to complete the task. MPAC recommended that council reconsider the appointment. Council28 January 2014

18 Performance in the Financial Year Audit Action Plan Sustainable Development ItemParticulars of Finding Impact of the finding on the Audit Report Action taken Responsible Person and Department Time Schedule Progress made 20 The National Treasury Framework for managing programme performance information requires that the performance targets be specific in clearly identifying the nature and required level of performance. A total of 100% of the targets were not specific in clearly identifying the nature and required level of performance. This was due to the fact that management did not implement the requirements of the National Treasury Framework for managing programme performance information when the Integrated Development Plan was developed and is still in the process of correcting this in order to comply with the requirements. Other matters A consultant started the process but has not been re- appointed to complete the task. MPAC recommended that council reconsider the appointment. Council 28 January The performance management system of the municipality did not provide for the monitoring of performance and for the measuring and review of performance at least once per year, with regard to each of those development priorities and objectives and against the key performance indicators and targets set, as required by Section 41 of the Municipal Systems act. Other matters A consultant started the process but has not been re- appointed to complete the task. MPAC recommended that council reconsider the appointment. Council28 January 2014

19 Performance in the Financial Year Audit Action Plan Sustainable Development ItemParticulars of Finding Impact of the finding on the Audit Report Action taken Responsible Person and Department Time Schedule Progress made 23 The performance management system of the municipality did not provide for taking steps to improve performance with regard to those development priorities and objectives where performance targets are not met, as required by Section 41 (1)(d) of the Municipal Systems Act. Other matters A consultant started the process but has not been re- appointed to complete the task. MPAC recommended that council reconsider the appointment. Council 28 January The municipality did not set measurable performance targets for the financial year with regard to each of the development priorities and objectives and key performance indicators set out in the Integrated Development Plan, as required by section 41 (1)(b) of the Municipal Systems Act and the Municipal Planning and Performance Management Regulation 12(1) and 12(2)(e). Other matters A consultant started the process but has not been re- appointed to complete the task. MPAC recommended that council reconsider the appointment. Council 28 January The municipality did not establish mechanisms to monitor and review its performance management system, as required by section 40 of the Municipal Systems Act. Other matters A consultant started the process but has not been re- appointed to complete the task. MPAC recommended that council reconsider the appointment. Council28 January 2014

20 Performance in the Financial Year Audit Action Plan Sustainable Development ItemParticulars of Finding Impact of the finding on the Audit Report Action taken Responsible Person and Department Time Schedule Progress made 26 The municipality did not set key performance indicators, including input indicators, output indicators and outcome indicators, in respect of each of the development priorities and objectives set out in the Integrated Development Plan, as required by section 41 (1)(a) of the Municipal Systems Act and the Municipal Planning and Performance Management Regulation 1 and 9(1)(a). Other matters A consultant started the process but has not been re- appointed to complete the task. MPAC recommended that council reconsider the appointment. Council 28 January A performance audit committee was not in place and the audit committee was not used to fulfil the performance audit committee function, as required by Municipal Planning and Performance Regulation 14(2)(a). Other matters A consultant started the process but has not been re- appointed to complete the task. MPAC recommended that council reconsider the appointment. Council 28 January The annual performance report for the financial year under review was not prepared, as required by section 46 of the Municipal Systems Act and section 121(3)(c) of the Municipal Finance Management Act. Other matters A consultant started the process but has not been re- appointed to complete the task. MPAC recommended that council reconsider the appointment. Council28 January 2014

21 Performance in the Financial Year Audit Action Plan Sustainable Development ItemParticulars of Finding Impact of the finding on the Audit Report Action taken Responsible Person and Department Time Schedule Progress made 29 The internal audit did not audit the results of performance measurements, as required by section 45 (1) (a) of the Municipal Systems Act and Municipal Planning and Performance Management Regulation 14(1) (a). Other matters Due to the non- determination of the predetermined objectives and the performance indicators, this action could not be undertaken. Internal Audit Unit 28 January The internal audit unit did not assess the functionality of the performance management system, as required by Municipal Planning and Performance Management Regulation 14(1) (b) (i). Other matters Due to the non- determination of the predetermined objectives and the performance indicators, this action could not be undertaken. Internal Audit Unit 28 January The internal audit unit did not assess the extent to which the performance measurements were reliable in measuring the performance of the municipality on key and general performance indicators, as required by Municipal Planning and Performance Management Regulation 14(1)(b)(iii). Other matters Due to the non- determination of the predetermined objectives and the performance indicators, this action could not be undertaken. Internal Audit Unit 28 January 2014

22 Performance in the Financial Year Audit Action Plan Sustainable Development Ite m Particulars of Finding Impact of the finding on the Audit Report Action taken Responsible Person and Department Time Schedule Progress made 32 The internal audit unit did not audit the performance measurements on a continuous basis and submitted quarterly reports on their audits to the municipal manager and the performance audit committee, as required by Municipal Planning and Performance Management Regulation 14(1)(c). Other matters Due to the non- determination of the predetermined objectives and the performance indicators, this action could not be undertaken. Internal Audit Unit 28 January The audit committee did not advise the council on matters relating to internal financial control, internal audits, effective governance, performance management and performance evaluation as required by section 166(2)(a) of the Municipal Finance Management Act. Other matters Audit committee members to be appointed on 28 January Municipal Manager 31 January The audit committee did not advise the council and accounting officer on matters relating to the adequacy, reliability and accuracy of financial reporting and information, as required by section 166(2)(iv) of the Municipal Finance Management Act. Other matters Audit committee members to be appointed on 28 January Municipal Manager 31 January 2014

23 Performance in the Financial Year Audit Action Plan Sustainable Development ItemParticulars of Finding Impact of the finding on the Audit Report Action taken Responsible Person and Department Time Schedule Progress made 35 The audit committee did not advise the council and accounting officer on matters relating to compliance with legislation, as required by section 166(2)(a)(vii) of the Municipal Finance Management Act. Other matters Audit committee members to be appointed on 28 January Municipal Manager 31 January The audit committee did not respond to the council on issues raised in the audit reports of the Auditor-General, as required by section 166(2)(c) of the Municipal Finance Management Act. Other matters Audit committee members to be appointed on 28 January Municipal Manager 31 January The audit committee did not review the annual financial statements to provide the council with an authoritative and credible view of the financial position of the entity, its efficiency and effectiveness and its overall level of compliance with legislation, as required by section 166(2)(b) of the Municipal Finance Management Act. Other matters Audit committee members to be appointed on 28 January Municipal Manager 31 January The audit committee did not meet at least four times a year, as required by section 166(4)(b) of the Municipal Finance Management Act. Other matters Audit committee members to be appointed on 28 January Municipal Manager 31 January 2014

24 Performance in the Financial Year Audit Action Plan Sustainable Development ItemParticulars of Finding Impact of the finding on the Audit Report Action taken Responsible Person and Department Time Schedule Progress made 39 Goods and services with a transaction value of below R were procured without obtaining the required price quotations as required by Supply Chain Management Regulations 17(a) & (c). Other matters A difference of interpretation existed. Head: Finance 1 December 2013 Implemented according to the Auditor General s interpretation. 41 Sufficient appropriate audit evidence could not be obtained that bids were evaluated by bid evaluation committees which were composed of officials from the departments requiring the goods or services and at least one supply chain management practitioner of the municipality as required by Supply Chain Management Regulation 28(2). Other matters A difference of interpretation existed. Head: Finance 1 December 2013 Implemented according to the Auditor General s interpretation. 42 Sufficient appropriate audit evidence could not be obtained that contracts and quotations were awarded only to bidders who submitted a declaration on whether they are employed by the state or connected to any person employed by the state, as required by Supply Chain Management Regulation 13(c). Other matters A difference of interpretation existed. Head: Finance 1 December 2013 Implemented according to the Auditor General s interpretation.

25 Performance in the Financial Year Audit Action Plan Sustainable Development ItemParticulars of Finding Impact of the finding on the Audit Report Action taken Responsible Person and Department Time Schedule Progress made 43 Invitations for competitive bidding were not always advertised for a required minimum period of days, as required by Supply Chain Management Regulation 22(1) & 22(2). Other matters All advertisements are published for the prescribed time in newspapers and CIBD. Head: Finance 1 December 2013 Advertisements are still published for the prescribed time. 44 The accounting officer did not meet the prescribed competency areas as required by section 83 of the Municipal Finance Management Act and regulation 2 and 3 of the Municipal Regulations on Minimum Competency Levels. Other matters MPAC drawn Councils attention to section 56(2) of the Municipal Systems Act. All actions taken by the official will therefore have unauthorised expenditure as a result. Council Council was alerted about the fact at a workshop held on 29 October Reasonable steps were not taken to prevent unauthorised expenditure and irregular expenditure, as required by section 62(1) (d) of the Municipal Finance Management Act. Other matters The actions and interpretation by the Auditor General has a huge impact. The management letter mentions root cause is misinterpretation of the supply chain regulations and policies Auditor General 31 January 2014 Awaiting comments from the Auditor General.

26 Performance in the Financial Year Audit Action Plan Sustainable Development ItemParticulars of Finding Impact of the finding on the Audit Report Action taken Responsible Person and Department Time Schedule Progress made 47 The accounting officer did not exercise adequate oversight responsibility over financial and performance reporting, compliance with laws and regulations as well as internal control. The lack of controls in the finance and supply chain management directorates resulted in non-compliance with applicable legislation and expenditure incurred not in terms of objectives. This, in turn, resulted in irregular and unauthorised expenditure. Other matters The actions and interpretation by the Auditor General has a huge impact. The management letter mentions root cause is misinterpretation of the supply chain regulations and policies Auditor General 31 January 2014 Awaiting comments from the Auditor General. 48 Leadership did not regularly monitor managements compliance with laws and regulations and internally designed policies and procedures. As a result, significant non-compliance issues were noted. Other matters Inconsistent actions and interpretation by the Auditor General complicates application. Municipal Manager 31 January 2014

27 Performance in the Financial Year Audit Action Plan Sustainable Development ItemParticulars of Finding Impact of the finding on the Audit Report Action taken Responsible Person and Department Time Schedule Progress made 49 Manual or automated controls were not designed to ensure that the transactions occurred were authorised and were completely and accurately processed. Other matters This matter was never raised in any previous audits. It is therefore unclear what is referred to. Auditor General 31 January 2014 More information was requested. 50The accounting officer did not implement proper record keeping in a timely manner to ensure that complete, relevant and accurate information was accessible and available to support financial and performance reporting. The financial statements were not sufficiently reviewed and the supply chain management unit could subsequently not detect some of the irregular and unauthorised expenditure occurred. Other matters This matter was never raised during the audit. It is therefore unclear what is referred to. Mention is made in the management letter that the financial statements are reviewed. Auditor General 31 January 2014 More information was requested.

28 Performance in the Financial Year 4.Special Adjustments Budget in terms of S32 of MFMA An adjustments budget was passed on 31 st January 2013 in terms of section 32 of the MFMA Sustainable Development

29 Performance in the Financial Year 4.Special Adjustments Budget in terms of S32 of MFMA Reasons for passing an adjustments budget Employee related costs were increased due to implementation of the task evaluations Bulk purchases were higher as a result of increased electricity sales Other materials and contracted services were increased due to expected increase in repairs and maintenance Operating grants were increased due to an expected expenditure to the upgrading of water services to Vanwyksvlei as well as grants received from other departments Sustainable Development

30 Aggregate Financial Performance for Sustainable Development Kareeberg Municipality 1.

31 Aggregate Financial Performance for Sustainable Development Executive and Council

32 Aggregate Financial Performance for Sustainable Development Budget and Treasury

33 Aggregate Financial Performance for Sustainable Development Corporate Services

34 Aggregate Financial Performance for Sustainable Development Health

35 Aggregate Financial Performance for Sustainable Development Community and Social Services

36 Aggregate Financial Performance for Sustainable Development Public Safety

37 Aggregate Financial Performance for Sustainable Development Sport & Recreation

38 Aggregate Financial Performance for Sustainable Development Waste Management

39 Aggregate Financial Performance for Sustainable Development Waste Water Management

40 Aggregate Financial Performance for Sustainable Development Road Transport

41 Aggregate Financial Performance for Sustainable Development Water

42 Aggregate Financial Performance for Sustainable Development Electricity

43 Aggregate Financial Performance for Sustainable Development Revenue by source 2.

44 Aggregate Financial Performance for Sustainable Development Revenue by source

45 Aggregate Financial Performance for Sustainable Development Revenue by source

46 Aggregate Financial Performance for Sustainable Development Revenue by source - explanations Rental of facilities and equipment Interest earned - external investments Rental for commonage is advertised and therefor accurate budgetary estimates cannot be given Less cash available due to the low payment rate for services (57%) and rates boicot

47 Aggregate Financial Performance for Sustainable Development Revenue by source

48 Aggregate Financial Performance for Sustainable Development Revenue by source - explanations Fines Licences and permits Agency services Fines cannot really be determined as it depends on fines imposed by the magistrate Revenue cannot really be determined as it depends on customers

49 Aggregate Financial Performance for Sustainable Development Revenue by source

50 Aggregate Financial Performance for Sustainable Development Revenue by source - explanations Government Grants and Subsidies Other revenue These are additional grants made by Government departments Estimates for bulk water supply to Vanwyksvlei did not realise Revenue as budgeted for, did not realise

51 Aggregate Financial Performance for Sustainable Development Expenditure by type

52 Aggregate Financial Performance for Sustainable Development Expenditure by type - explanations Debt impairmentAn increase in debtors caused an increased contribution to the provision

53 Aggregate Financial Performance for Sustainable Development Expenditure by type

54 Aggregate Financial Performance for Sustainable Development Expenditure by type - explanations Depreciation & asset impairment Finance charges Expenditure was not as high as anticipated – PPE was recorded as work in progress, for which depreciation is not recorded as yet Finance charges cannot be determined accurately because the actuarial survey is done annually

55 Aggregate Financial Performance for Sustainable Development Expenditure by type

56 Aggregate Financial Performance for Sustainable Development Expenditure by type - explanations Contracted Services Other expenditure Loss on disposal of PPE Because of cash constraints, budgeted repairs and maintenance are neglected This includes expenditure on grants received from government departments Estimates for bulk water supply to Vanwyksvlei did not realise Council only allows periodical culling of game, and then partly as benefit to the local community

57 Aggregate Financial Performance for Sustainable Development Personnel remuneration - Councillors, 3.

58 Aggregate Financial Performance for Sustainable Development Personnel remuneration – Senior managers

59 Aggregate Financial Performance for Sustainable Development Personnel remuneration – Other staff

60 Performance against the IDP and SDBIP targets for Sustainable Development Kareeberg Municipality IDP Objective ProjectBaseline Status Quo Measurable Performanc e Indicator Original SDBIP Target (Annual) Revised SDBIP Target (Annual) Actual Performanc e for Original Budget Revised Budget Actual Outcome Provide paved roads in Carnarvon, Vanwyksvlei and Vosburg Paving of gravel roads in Carnarvon, Vanwyksvlei and Vosburg 40 km of gravel roads in Carnarvon, Vanwyksvlei and Vosburg Replace 3,5 km of gravel roads with paving in Carnarvon, Vanwyksvlei and Vosburg m2 934m Provide a safe environment in Carnarvon, Vanwyksvlei and Vosburg Supply High mast Lighting in Carnarvon, Vanwyksvlei and Vosburg Erect 3 High mast lights in Carnarvon, Vanwyksvlei and Vosburg Erect 3 High Mast Lights in Carnarvon, Vanwyksvlei and Vosburg

61 Auditor Generals Report Sustainable Development Qualified opinion In my opinion, except for effects of the matters described in the Basis for qualified opinion paragraphs, the financial statements present fairly, in all material respects, the financial position of the Kareeberg Local Municipality as at 30 June 2013 and its financial performance and cash flows for the year then ended in accordance with SA Standards of GRAP and the requirements of the MFMA and DoRA

62 Auditor Generals Report Sustainable Development Finding2012/13 Yes/No Recurrence from 2011/2012 Yes/No Non-current AssetsNo Current AssetsNo LiabilitiesNo Other Disclosure ItemsNo RevenueNo ExpenditureNo Irregular ExpenditureYesNo Unauthorised ExpenditureYesNo Fruitless and Wasteful Expenditure No Matters of emphasis Was mentioned in the audit action plan on previous slides

63 Auditor Generals Report Sustainable Development Matters of emphasis Was mentioned in the audit action plan on pages 13 to 27 Supply chain irregularities Was mentioned in the audit action plan on pages 13 to 27

64 Special Adjustments Budget in terms of Section 32 of MFMA and Regulation 23.5 Sustainable Development Unauthorised expenditure Unauthorised expenditure – capital ReasonAmount% overspent Condoned/written off by council Budget and Treasury office Community and Social Services Road Transport Water Electricity Purchase of computer equipment Purchase of office equipment and additions to buildings Paving of streets Bulk water supply Vanwyksvlei High mast Lighting

65 Special Adjustments Budget in terms of Section 32 of MFMA and Regulation 23.5 Sustainable Development Unauthorised expenditure Unauthorised expenditure current year – capital ReasonAmount% overspent Condoned/written off by council Non up to 31 December 2014

66 Special Adjustments Budget in terms of Section 32 of MFMA and Regulation 23.5 Sustainable Development Value of unauthorized, irregular or fruitless and wasteful expenditure for the past five years YearValueAmount condoned/written off

67 Session 2 Sustainable Development In-year Performance

68 Mid-year performance financial year Sustainable Development Kareeberg Municipality 1.

69 Mid-year performance financial year Sustainable Development Executive and council

70 Mid-year performance financial year Sustainable Development Budget and Treasury office

71 Mid-year performance financial year Sustainable Development Corporate services

72 Mid-year performance financial year Sustainable Development Health

73 Mid-year performance financial year Sustainable Development Community and social services

74 Mid-year performance financial year Sustainable Development Public Safety

75 Mid-year performance financial year Sustainable Development Sport and recreation

76 Mid-year performance financial year Sustainable Development Solid Waste management

77 Mid-year performance financial year Sustainable Development Waste Water management

78 Mid-year performance financial year Sustainable Development Road Transport

79 Mid-year performance financial year Sustainable Development Water

80 Mid-year performance financial year Sustainable Development Electricity

81 Mid-year performance financial year Sustainable Development Revenue by source 2.

82 Mid-year performance financial year Sustainable Development Revenue by source - explanations Property rates Property rates-collection costs/ penalties New valuation roll. Rebates under budgeted for Because of late levying of property rates, council extended the due date and therefor penalties will only be levied from January

83 Mid-year performance financial year Sustainable Development Revenue by source

84 Mid-year performance financial year Sustainable Development Revenue by source

85 Mid-year performance financial year Sustainable Development Revenue by source - explanations Rental of facilities and equipment Interest earned – external investments Rental of facilities are invoiced during the year The bulk of interest revenue was budgeted for in June

86 Mid-year performance financial year Sustainable Development Revenue by source

87 Mid-year performance financial year Sustainable Development Revenue by source - explanations Fines Licenses and permits Agency services Transfers and grants No real pattern of revenue can be determined, thus this revenue source is budgeted for conservatively. No real pattern of renewal of vehicle licenses can be determined, thus this revenue source is budgeted for conservatively. Revenue is only recognised in June 2014

88 Mid-year performance financial year Sustainable Development Expenditure by type

89 Mid-year performance financial year Sustainable Development Expenditure by type

90 Mid-year performance financial year Sustainable Development Personnel remuneration - councillors 3.

91 Mid-year performance financial year Sustainable Development Personnel remuneration – senior managers

92 Mid-year performance financial year Sustainable Development Personnel remuneration – other staff

93 Performance in the Financial Year performance against IDP and SDBIP targets Sustainable Development a)Approval revised IDP Plan b)Approval of the Annual Report 2012/13 c)Implement a Performance Management System d)Newsletters e)Public Meetings f)Oversee that training in terms of the Skills Development Plan is being implemented g)Reclaim all monies due i.t.o. Skills Development Plan Council referred the IDP Process Plan back to shared services for completion Could not be approved due to audit action plan referred back to MPAC Evaluation of managers not done for quarters 1 and 2 No official was charged with the task Mayor did not convene meetings Insufficient funding received from LGSETA Although all the relevant documentation is submitted the exercise is worthless

94 Performance in the Financial Year performance against IDP and SDBIP targets Sustainable Development h)100% Support for the Audit Committee. i)Ensure that the recommendations in the External Audit report is successfully implemented j)To facilitate active and structured public participation during the drafting of the IDP Process k)To record the priority needs of all sectors of the community in the amended IDP document. Audit committee is only appointed on 28 th January 2014 This is an ongoing process and recommendations are reviewed monthly. All the recommendations made by the AG have not been clarified and the Audit Action Plan has not been completed. The IDP process has not yet commenced

95 Performance in the Financial Year performance against IDP and SDBIP targets Sustainable Development l)To ensure the alignment of the IDP objectives be reflected in the municipal budget m)4 Ward Committee meetings per annum n)Draft IDP for approval by Council o)Facilitate community meetings for Mayor per town. p)The dumping of all waste at the waste sites and administering the maintenance of the dumping site. The IDP process has not yet commenced Only first quarter. No quorum could be assembled IDP Process Plan was referred back to the shared services Mayor did not convene meetings The only contractor available was not approved for the cleaning of the waste sites. The community dumps waste irresponsibly

96 Performance in the Financial Year performance against IDP and SDBIP targets Sustainable Development q)Manage maintenance all electrical distribution machinery and mechanical equipment. (excl. Eskom) r)Manage maintenance of assets s)Manage the maintenance of the municipal vehicles fleet and equipment Lack of necessary cash

97 Mid-year SDBIP performance against targets for Sustainable Development Kareeberg Municipality IDP Objective ProjectBaseline Status Quo Measurable Performance Indicator Original SDBIP Target Revised SDBIP Target Actual Perfor- mance for Original Budget Year to date Budget Mid- year Perfor- mance Provide paved roads in Carnarvon To provide recreational facilities in Carnarvon Cemetries in Vanwyksvlei and Vosburg Paving of gravel roads in Carnarvon Upgrading of sport complex in Carnarvon Cemetries in Vanwyksvlei and Vosburg 1,338km of gravel roads in Carnarvon Insufficient sport facilities in Carnarvon Insufficient burial space in Vanwyksvlei and Vosburg Replace 1,338km of gravel roads with paving Sport complex in Carnarvon New cementries in Vanwyksvlei and Vosburg 1 338m Sport Complex Cementry in Vanwyksvlei and Vosburg 1 338m Sport Complex Cementry in Vanwyksvlei and Vosburg 0m

98 Infrastructure delivery achievement against infrastructure Sustainable Development 5. Infrastructure projects Project Upgrade of streets Bulk water supply - Vanwyksvlei Upgrade of water network Upgrading of refuse site-Carnarvon Surface of runway- airstrip Upgrade of sports field-Carnarvon Erection of speed humps

99 Infrastructure delivery achievement against infrastructure Sustainable Development 5. Infrastructure projects Project Layout of cemetery- Vanwyksvlei Layout of cemetery – Vosburg Erection of High Mast Light-Carnarvon Placing of refuse containers Upgrading of heritage sites Building of taxi rank Purchase of additional commonage

100 Infrastructure delivery achievement against infrastructure Sustainable Development Infrastructure projects brought forward Upgrade of sports field-Carnarvon Challenges during project implementation Changes in plans for the sport complex CIBD-ratings of contractors not renewed Reasons for slow performance Changes in plans for the sport complex CIBD-ratings of contractors not renewed Impact on grant spending Conditional grants will be spent in full

101 Conditional Grants performance per grant type Sustainable Development

102 2014 Adjustments Estimate Sustainable Development Is the adjustments budget completed in B-Schedule format? Have the adjustments budget been reviewed by the budget steering committee? Have the necessary adjustments to the SDBIP and performance agreements been made? When will the adjustments budget be tabled before council? Was there a presentation made and explanation given for the proposed adjustments? Is the adjustments budget properly funded i.t.o. Tables A7 and A8? Were there any significant reductions/ additions that stems from poor planning processes? No budget benchmark was done for the adjustments budget Yes No 28 February 2014 Yes No

103 Status of Budget Preparation Process Sustainable Development Has the municipality tabled the IDP and budget process schedule in council by 31 August 2013? Yes ActivityResponsibilityTarget DateProgress against Target Explanation for non-compliance Table before council the schedule of key deadlines Budget steering committee meeting Revision of the IDP Workshop with heads of department Accounting officer Mayor CFO 31 August November 2013 Tabled before council on 28 August December 2013 N/A Process Plan only approved 28 January 2014 The size of the municipality does not justify to hold workshops. It forms part of the budget steering committee

104 Status of Budget Preparation Process Sustainable Development ActivityResponsibilityTarget DateProgress against Target Explanation for non- compliance Advertise for input from community Accounting officer 30 November 2013No input or comments received Has the municipality included dates for the 2014 MTREF Municipal budget and benchmark engagement schedule to take place between April and May 2014? Yes – Treasury to supply dates

105 Session 3 Sustainable Development Financial Management Issues

106 Institutional arrangements Sustainable Development Budget and Treasury Office Supply Chain Management Internal Audit Vacancies Competencies of personnel All personnel has more than one function because of a small staff establishment Only three managers on adjudication committee. Specification and evaluation committees established. The municipality makes use of the shared services unit from Pixley ka Seme District Municipality There are no vacancies at administrative level Three senior managers have acquired the necessary unit standards equal to NQF level 6 One senior accountant has acquired the necessary unit standards equal to NQF level 6

107 Institutional arrangements Sustainable Development Competencies of personnel Further finance management training Four junior staff members have successfully completed NQF level 4 training Three junior staff members completed SAQA All personnel were accorded the opportunity to enroll for training

108 MFMA Issues Sustainable Development Status of MFMA compliance Update on MFMA system of delegations Management of asset/ GRAP compliance Management of liabilities The municipality strive to comply with the MFMA The municipality has delegations The municipalitys asset register is GRAP compliant. The financial statements are compiled in accordance with GRAP standards Employee benefits comprise the bulk of liabilities(R ) Provision for rehabilitation of landfill sites(R ) Unspent conditional grants(R /12/2013) Consumer deposits and other payables amount to R

109 MFMA Issues Sustainable Development Status on supply chain management Revenue/ debtor management Status on internal audit Timely payment of creditors All staff members in the BTO handles supply chain when necessary Debtors have increased by R for the six months The credit control and debt collection by- law regulates debt management Shared services at Pixley ka Seme DM renders the internal audit function. Internal audit is done each quarter where after the audit committee convenes and takes note of the internal audit report and makes recommendations to council if necessary All trade creditors are paid within 30days

110 Audit Action Plans Sustainable Development Plans to address issues raised by the Auditor General in report Repeat issues Status on preparation of annual financial statements Draft audit action plan was approved by MPAC but council referred it back to MPAC. Predetermined objectives have not been reported on AFS has been submitted and audit has been completed Section 139 Interventions At this stage council is not aware of any section 139 intervention

111 Session 4 Sustainable Development Predetermined Objectives Item 13 to 23 Compliance with laws and regulations Item 24 to 25 Predetermined Objectives Item 27 to 30 Risk Management

112 Top ten risks in the municipality Sustainable Development Risk nameAssigned toProgress made to date Alignment with IDP and Budget 1.Dumping of rubbish on open spaces and in trenches 2.Pot holes in tarred roads 3.Insufficient cash 4.Unsafe electrical installations 5.No lasting water resources- Vanwyksvlei 6.Condition of refuse sites Chief Operational Manager Head: Finance Chief Operational Manager Wait for council resolution on the way forward Personnel shortage hampers the project Consumers handed over to attorneys and reminders sent Wait for council resolution on the way forward Consultants busy with test of underground water yields Wait for council resolution on the way forward Part of maintenance budget Included in the IDP project list Part of maintenance budget

113 Top ten risks in the municipality Sustainable Development Risk nameAssigned toProgress made to date Alignment with IDP and Budget 7.Over grazing of commonage 8.Limited maintenance of assets 9.Stray animals in streets 10.Overflow of oxidation ponds 11.Operation Clean Audit 2014 Chief Operational Manager Chief Operational Manager/ Head: Finance Chief Operational Manager Accounting officer Wait for council resolution on the way forward Council is regularly informed about the status of maintenance Animals are pounded during normal office hours, it is however a problem after hours Consultant busy with business plans to build additional ponds MPAC recommended that consultants be appointed to finalise the whole issue in connection with predetermined objectives Part of the maintenance budget

114 Top ten risks in the municipality Sustainable Development Has a formal risk register been drafted? Has the municipality appointed a Chief Risk Officer? What internal structures have been established to deal with risk management? Have risks been aligned with IDP and budget? Yes None Partially

115 I Thank you Sustainable Development Brennan Rossouw Head: Finance


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