1. Presentation to the Portfolio Committee on Finance
Audit outcomes of Statistics South Africa for
19 October 2010 1

2. Reputation promise of the Auditor-General of South Africa (AGSA)
“The Auditor-General of South Africa has a constitutional mandate, and, as the Supreme Audit Institution (SAI) of South Africa, it exists to strengthen our constitutional democracy by enabling oversight, accountability and governance in the public sector through auditing, thereby building public confidence.” 2

3. Summary of 2009-10 Audit outcomes – Statistics South Africa
Department
Opinion on financial statements:
Disclaimer
Adverse
Qualified
Financially unqualified with findings on predetermined objectives and/or compliance with laws
and regulations 1
Financially unqualified with no findings on predetermined objectives or compliance with laws
Total number of audits reported on
Entities with findings arising from AGSA other legal reporting responsibilities:
Predetermined objectives
Compliance with laws and regulations 3

4. Statistics South Africa – PFMA audit outcomes 2009-10 Drivers of improved audit outcomes
Leadership
Auditees who have improved/ maintained previous good practice
Auditees where Improvements are required
Departments
Public entities
Provision of adequately skilled resources capable of implementing the financial reporting framework and performance management requirements, as well as adequate evaluation of the performance of existing staff :
Financial Statements
Predetermined objectives 1 -
Ensuring that proper actions are taken to address audit findings; key controls are implemented to mitigate risk of misstatement of financial statements and report on predetermined objectives:
Leadership’s implementation of action plans to address user access control deficiencies (Information Systems)
Note: 3 separate slides dealing with (1) Leadership, (2) Financial and performance management and (3) Governance. This includes issues addressed and to be addressed. (previously slides #4 and #15)
Details of the ‘Key leadership matters addressed/to be addressed ’ should be drawn from management reports
Reflect on how well stakeholder engagements / key control review have been done and why things may not have moved / commitments didn’t work.
Notes to the slides should be specific when an entity is the main reason for the issues or when there are specific reasons for the matters reported.
Notes to include discussion on commitments made that did not address the problems or that were not actioned.
Note those entities who avoided qualifications by correcting material misstatements in financial statements identified during the audit

5. Statistics South Africa – PFMA audit outcomes 2009-10 Drivers of improved audit outcomes
Financial and performance management
Auditees who have improved/ maintained previous good practice
Auditees where Improvements are required
Departments
Public entities
Appropriate systems are in place to support the preparation of financial statements and performance reports:
Financial Statements
Predetermined objectives - 1
Review of the financial statements and other information by management for completeness and accuracy prior to submission for audit:
Proper record keeping and management, ensuring that supporting documents are properly filed and easily retrievable:
4. Application systems susceptible to compromised data integrity (Information Systems)
User access control
Security management
Business Continuity
Note: 3 separate slides dealing with (1) Leadership, (2) Financial and performance management and (3) Governance. This includes issues addressed and to be addressed. (previously slides #4 and #15)
Details of the ‘Key leadership matters addressed/to be addressed ’ should be drawn from management reports
Reflect on how well stakeholder engagements / key control review have been done and why things may not have moved / commitments didn’t work
Notes to the slides should be specific when an entity is the main reason for the issues or when there are specific reasons for the matters reported.
Notes to include discussion on commitments made that did not address the problems or that were not actioned.
Note those entities who avoided qualifications by correcting material misstatements in financial statements identified during the audit

6. Statistics South Africa – PFMA audit outcomes 2009-10 Drivers of improved audit outcomes
Governance
Auditees who have improved/ maintained previous good practice
Auditees where Improvements are required
Departments
Public entities
Maintaining effective risk assessments and strategies including fraud prevention plans to address identified weaknesses:
Financial Statements
Predetermined objectives 1 -
Ensuring effective internal audit functions that monitor the adequacy and implementation of internal control:
Establishment of functioning audit committees that promotes independent accountability and service delivery:
An IT governance framework that directs the positioning of IT, resource requirements, risk and internal control management (Information Systems).
Note: 3 separate slides dealing with (1) Leadership, (2) Financial and performance management and (3) Governance. This includes issues addressed and to be addressed. (previously slides #4 and #15)
Details of the ‘Key leadership matters addressed/to be addressed ’ should be drawn from management reports
Reflect on how well stakeholder engagements / key control review have been done and why things may not have moved / commitments didn’t work
Notes to the slides should be specific when an entity is the main reason for the issues or when there are specific reasons for the matters reported.
Notes to include discussion on commitments made that did not address the problems or that were not actioned.
Note those entities who avoided qualifications by correcting material misstatements in financial statements identified during the audit

7. Financial statement qualification areas
There were no areas of qualification

8. Financial statement areas
Statistics South Africa – PFMA audit outcomes Misstatements corrected
Financial statement areas
Entities impacted
Capital Assets
None
Current Assets
Liabilities
Note: 3 separate slides dealing with (1) Leadership, (2) Financial and performance management and (3) Governance. This includes issues addressed and to be addressed. (previously slides #4 and #15)
Details of the ‘Key leadership matters addressed/to be addressed ’ should be drawn from management reports
Reflect on how well stakeholder engagements / key control review have been done and why things may not have moved / commitments didn’t work
Notes to the slides should be specific when an entity is the main reason for the issues or when there are specific reasons for the matters reported.
Notes to include discussion on commitments made that did not address the problems or that were not actioned.
Note those entities who avoided qualifications by correcting material misstatements in financial statements identified during the audit

9. Financial statement areas
Statistics South Africa – PFMA audit outcomes Misstatements corrected
Financial statement areas
Entities impacted
Revenue
None
Expenditure
6. Other disclosures
Statistics South Africa
Note: 3 separate slides dealing with (1) Leadership, (2) Financial and performance management and (3) Governance. This includes issues addressed and to be addressed. (previously slides #4 and #15)
Details of the ‘Key leadership matters addressed/to be addressed ’ should be drawn from management reports
Reflect on how well stakeholder engagements / key control review have been done and why things may not have moved / commitments didn’t work
Notes to the slides should be specific when an entity is the main reason for the issues or when there are specific reasons for the matters reported.
Notes to include discussion on commitments made that did not address the problems or that were not actioned.
Note those entities who avoided qualifications by correcting material misstatements in financial statements identified during the audit

10. Statistics South Africa – PFMA audit outcomes 2009-10 Fruitless and wasteful expenditure
Entity and Reasons
Amount – 2009/10
Statistics South Africa (Services procured and paid for but not utilised) R
Note: 3 separate slides dealing with (1) Leadership, (2) Financial and performance management and (3) Governance. This includes issues addressed and to be addressed. (previously slides #4 and #15)
Details of the ‘Key leadership matters addressed/to be addressed ’ should be drawn from management reports
Reflect on how well stakeholder engagements / key control review have been done and why things may not have moved / commitments didn’t work
Notes to the slides should be specific when an entity is the main reason for the issues or when there are specific reasons for the matters reported.
Notes to include discussion on commitments made that did not address the problems or that were not actioned.
Note those entities who avoided qualifications by correcting material misstatements in financial statements identified during the audit

11. Statistics South Africa – PFMA audit outcomes 2009-10 Irregular Expenditure
Entity and Reasons
Amount – 2009/10
Statistics South Africa (Overtime exceeding 30% of gross monthly basic salary)
R1, 015 million
Note: 3 separate slides dealing with (1) Leadership, (2) Financial and performance management and (3) Governance. This includes issues addressed and to be addressed. (previously slides #4 and #15)
Details of the ‘Key leadership matters addressed/to be addressed ’ should be drawn from management reports
Reflect on how well stakeholder engagements / key control review have been done and why things may not have moved / commitments didn’t work
Notes to the slides should be specific when an entity is the main reason for the issues or when there are specific reasons for the matters reported.
Notes to include discussion on commitments made that did not address the problems or that were not actioned.
Note those entities who avoided qualifications by correcting material misstatements in financial statements identified during the audit

12. Statistics South Africa – PFMA audit outcomes 2009-10 Unauthorized Expenditure
Entity and Reasons
Amount – 2009/10
Statistics South Africa
None
Note: 3 separate slides dealing with (1) Leadership, (2) Financial and performance management and (3) Governance. This includes issues addressed and to be addressed. (previously slides #4 and #15)
Details of the ‘Key leadership matters addressed/to be addressed ’ should be drawn from management reports
Reflect on how well stakeholder engagements / key control review have been done and why things may not have moved / commitments didn’t work
Notes to the slides should be specific when an entity is the main reason for the issues or when there are specific reasons for the matters reported.
Notes to include discussion on commitments made that did not address the problems or that were not actioned.
Note those entities who avoided qualifications by correcting material misstatements in financial statements identified during the audit

13. Type of audit conclusion
Report on predetermined objectives
Indication of audit conclusions not included in audit report
General
■ Phase-in approach by the AGSA since together with National Treasury
■ Stakeholder engagements to clarify approach and essence of auditing of predetermined objectives have taken place and will continue throughout
■ In departments and entities will need to take decisive action to address the areas requiring improvement in order to position themselves for a positive audit outcome on predetermined objectives
Type of audit conclusion
Department
Public entities
Disclaimer
Adverse
Qualified
Unqualified 1
Total number of audits reported on
The total number of audits must be equal to one less than the number on slide # 3,since predetermined objectives do no apply to the Revenue Fund 13 13

14. Statistics South Africa
Findings on reporting of predetermined objectives
Category of finding
Department
Public entities
Non-compliance with regulatory requirements 0%
100%
Reported information not useful
Reported information not reliable
Information not submitted for audit by 31 May 2010
Total number of audits reported on 1
Findings for are available on the AS: MIS
findings to be extracted for the provincial General Report 14 14

15. Top categories of prohibited actions/non-adherence
Statistics South Africa
Findings on compliance with laws and regulations
Top categories of prohibited actions/non-adherence
Number
Percentage
Department
SCM issues that resulted in irregular expenditure 0%
Payments not done within 30 days
HR Management
General/ fiduciary and reporting responsibilities of accounting officers and internal audit not operating effectively throughout the year
Public entities
General/ fiduciary and reporting responsibilities
Internal audit
Audit committee and strategic/ corporate plans
This data to be drawn from ‘compliance workbooks’ completed by ABUs
Limited to non-compliance issues included in audit reports 15 15

16. Top 5 findings on procurement and contract management
Statistics South Africa
Findings on procurement and contract management
Top 5 findings on procurement and contract management
Number
Percentage
Public entities
3 price quotations not invited - reasons not recorded and approved 0%
The fraud prevention plan did not include specific measures for preventing and detecting fraud in the procurement process.
R with no competitive bidding - reasons not recorded and approved
A list of prospective suppliers from whom to invite price quotations was not in place.
SCM policies and procedures were not in place for the acquisition of goods and services.
This data to be drawn from ‘Procurement and contract management workbooks’ completed by ABUs. 16 16

17. Statistics South Africa audit outcomes Audits not conducted by the Auditor-General of South Africa
None
Sources and guidance for this slide are as for corresponding slide for audits conducted by the AGSA