22 April 2015

A ROUTE TO CLEAN AUDIT

6th Annual Audit And Risk Indaba

Ekurhuleni Metro @ glance

Contents

Milestone

Pillars of a clean audit

Sustaining the clean audit

Starting point

Ekurhuleni Metro @ glance

3

BACKGROUND DATA

3 178 470 million residential population

1 015 645 million households

723,448 households refuse removed weekly

85% have flush toilets

82.2% access to electricity for lighting

2011 census

BACKGROUND DATA

38% unemployment rate

Operating income is R26.3 billion

Capital investment program of R3.8 billion

2011 census

44% have deeds of ownership

77.4% reside in formal dwellings

Ekurhuleni Metro @ glance

4

Delivering City (2012 - 2020)

• efficient & cohesive municipal institution

• effective delivery of basic services

• functioning area management

• sound financial footing

• Well informed and resourced IDP

Starting point

2000

5

• It was established after the amalgamation of 11 erstwhile administrations which used to constitute the former East Rand.

• Reconciliations of many bank accounts,

• Merging the assets registers

• Placements of employees

• Condition of services

• Streamlining process of the various administration systems while ensuring that there was no disruption to service delivery

“The first step towards success is when you refuse to be a captive of the environment in which you first find yourself”

6

2007 internal audit was fully institutionalised

2010• Approved top

institutional structure

• OPCA was established

2008: Risk as function was established

Administration: Implement

Executive: monitoring

Legislature: Oversight

Milestones

2009 risk based audit

2011 Separation of power

2011 Performance contracts HoD: Risk and audit findings

Political leadership

7

2010-2013 FY

2013/2014

• All level of leadership took part as either implementers of the management letter and general improvement of the internal controls

• Leadership on monitoring and evaluation

• Oversights by different committees e.g. MPAC, Finance oversights and all committees for different departments

Financial Statement

Compliance

CLEAN AUDIT

Pre-Defined

Objectives

8

• Annual Financial Statement: unqualified audit opinion

• Pre-determined objectives (service delivery): No material findings

• Laws, regulations and policies: no material findings

• EMM and 5 of its 6 entities achieved clean audit.

Pillars for clean audit

Approach to Operation Clean Audit Approach• Audit findings were addressed as a project

and not once off.

• Emphasis was placed on the value chain not audit finding raised.

• Proactive approach was taken to ensure that the root cause is addressed

• OPCA report was done quarterly to Mayoral committee

• Internal Auditor assisted by providing independent assurance on the implementation of the action plans on audit issues and take their findings serious

Leadership• Tone at the top towards good and

clean administration is clear and unambiguous.

• Team work• Appointment of competent

professionals• Strong audit committee

MPAC

• Robust MPAC that hold Executive and SM

accountable • Follow-up on

consequence management

• Deadline driven

EM and CMReview performance of the metro against commitments they made to the AG at the end of the previous financial

year

10

2000-2009 Qualified opinions

2010-2013 Unqualified 4 yrs

2014 CLEAN AUDIT

2015 beyond sustain the clean audit

Milestones

• Risk assessment of three key pillars of the clean audit.

• Mitigation strategy for ensuring that focus remains

• Quality of reporting on

predetermined audit objectives

non-financial information.

11

BA

CK

TO

BA

SIC

S

Sustaining the clean audit

• Continue to train the

finance team,

Performance, Risk and

Audit.

You will definetrly not change the world if you are always worried about being liked

12

13