1. Summary presentation: Q & A Session
Presented by National Treasury

2. mSCOA Project Phases: The journey to the checkered flag…
Kick off engagements with municipalities, vendors and other stakeholders
Regulation issued and commissioning of mSCOA Project Phase 4: Change management and piloting including identification of pilots
Piloting commencement with 9 pilot municipalities (local and districts) and 4 Metro’s (City of Cape Town, Ekurhuleni, Mangaung and Buffalo City) – Phased over 2015/16 and 2016/17)
2010
2011
2014
Vendors were briefed as to development of mSCOA and initial evaluations of system functionality.
2015
Ensuring that piloting municipalities and system functionality is aligned to the compliance requirements of the Regulation will create an enabling environment for the roll out to non-piloting municipalities
Remaining metro’s to implement (pilot) mSCOA and project initiation for the non-piloting municipalities
2017
2016
278 municipalities fully mSCOA compliant

3. Standard Chart of Accounts Improved Service Delivery
The Local Government Accountability Cycle and mSCOA
The IDP (unlimited needs and wants) must directly inform the formulation of the budget (limited basket of resources). mSCOA requires budget formulation (as per the MBRR) from a project level (The Project Segment is the departure point in formulating a budget across the 7segments).
IDP
5 Year Strategy
Budget
3 Year
SDBIP
Annual Plan to Implement
IYR
Monitoring
AFS
Oversight
Annual Report
Standard Chart of Accounts
Improved Service Delivery
Budget implementation (transact & report)
MBRR and reporting to LG Database (6 regulated segments)
Formulate implementation plan e.g. regional perspective, funding, cash flow breakdown etc.
In-year reporting (focus MBRR), MFMA s. 71 & 72.
Budget to directly inform implementation and transactional environment.
Seamless alignment.
One version of the truth
Evidence based financial management in real time.
Transactional validation and audit trails.
mSCOA provides for alignment of the accountability cycle;
Improved transparency and accountability;
Classification based on leading practice and internal standards;
Consistent aggregation of municipal financial info across the entire accountability cycle
Whole of government reporting
Accountability Reporting
Incorporate GRAP
Improve standardisation
Improve audit process across 278 munis.
Consistent comparability
Transparency

4. What Segments are Required
Project: This segment is to ensure that all projects in the IDP is aligned to budgets.
Municipal Standard Classification: MSC is a non regulated segment and will probably still represent the MFMA vote.
Function: Here we align with the IMF, GFS, Constitution and Municipal Structures act to “Departments and Votes”
Costing: The costing segment will grow as maturity levels grow initially a allocation of cost from Administrative functions to Commercial services will suffice.
Item: This is the Accountants segment and is informed by GRAP, IFRS and accounting standards. All financial reporting and reconciliations happen in this segment.
Region: Communities need to feel and see delivery, Only through planning and physical delivery can this be communicated effectively.
Fund: National and Provincial Government are on Modified cash and Local government “Item are on Accrual” Here we align to Payments and receipts and in essence achieve cash flow here.

5. Consolidated Evaluation by PT’s/Advisors
National Treasury

6. Vendor / Province Assessment
Live on mSCOA
Started implementing with IDP budget module
Not implementing yet but will be live 1 July 2017 with full IDP linked budget
Not implementing yet but will be live 1 July 2017 without full IDP
Chances are high that the municipality will NOT meet the 1 July 2017 deadline
Vendors
Provinces
National Treasury

7. mSCOA Aligned to MFMA Calendar: The journey to success…
Budget process:
Populate the Municipal running cost and Maintenance & repair Projects;
Functions will need to link the required Items to deliver the Projects;
Align the IDP with available resources (Funding & Revenue Items ); and
Determine the Costing module and finalize tariffs.
IDP process:
Needs to begins with in the prescribed period from 3 August 2016.
July till September
October till November
January Till March
Finalization of the chart
Budget Approval process
Create SDBIP based on Budget.
Community Participation:
Identify Projects (Capital and typical work streams);
Identify Regions of these projects; and
Identify the Function that need to deliver the projects.
March till June
Implementing the new chart of accounts and carry over of the legacy items opening balances. Note restatements for 2018/19 year.
1 July 2017

8. mSCOA Aligned to MFMA Calendar: The way forward: Institutionalization
Ongoing management and review of posting, correction of miss-allocations and performance against projects = IDP.
Finalization of integration of subsystems.
Development of costing.
Institutionalization of business processes and SOPs.
Transacting on the full mSCOA chart, preparation for submission of first data strings at month end
1 July 2017
30 September 2017
2017/ 2018
First mSCOA year end and AFS.
Annual report, performance against projects = IDP.
Audit of mSCOA compliance by AGSA.
Submission of the first quarterly report;
Previous year audit
30 June
Correction of prior year errors, Implementing the audit outcomes,
Preparation and further developments for the 2nd mSCOA year.
1 July 2018

9. Thank you
QUESTIONS?