Overview of the AGSA

IMFO SEMINAR

08 March 2016

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Introduction

• The Auditor-General of South Africa (AGSA) is the supreme audit institution (SAI) of

South Africa.

• It is the only institution which, by law, has to audit and report on how the government

is spending the South African taxpayers’ money which has been the focus of the AGSA

as an institution since its inception in 1911.

• Their roles and responsibilities were expanded since the new Constitution came into

effect.

• The AGSA is a “chapter 9” institution because its mandate is outlined in chapter 9

(sections 181 and 188) of the Constitution of the Republic of South Africa.

• The AGSA annually produces audit reports on all government departments, public

entities, municipalities and public institutions.

• In addition, the audit outcomes are analysed in general reports that cover both the

Public Finance Management Act (PFMA) and Municipal Finance Management Act

(MFMA) cycles.

• Reports on discretionary audits, performance audits and other special audits are also

produced.

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Public Audit Act, 2004Constitutional functions

4. (1) The Auditor-General must audit and report on the accounts, financial statements and

financial management of all national and provincial state departments and

administrations; all constitutional institutions; the administration of Parliament and of

each provincial legislature; all municipalities; all municipal entities; and any other

institution or accounting entity required by other national or by provincial legislation to

be audited by the Auditor-General.

(2) The Auditor-General must audit and report on the consolidated financial statements of

the national government as required by section 8 of the PFMA; all provincial

governments as required by section 19 of the PFMA; and a parent municipality and all

municipal entities under its sole or effective control as required by section 122(2) of the

MFMA.

(3) The Auditor-General may audit and report on the accounts, financial statements and

financial management of any public entity listed in the PFMA; and any other institution

not mentioned in subsection (1) and which is funded from the National Revenue Fund

or a Provincial Revenue Fund or by a municipality; or authorised in terms of any

legislation to receive money for a public purpose.

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Our Vision

To be recognised by all our stakeholders as a relevant SAI that

enhances public sector accountability.

3000+

Our workforce As the supreme audit institution of South Africa, we are

committed to professionalism

500+Chartered accountants(SA)

42 Masters

29 Chartered

certified accountants61 Certified information

system auditors

332 Registered

government auditors

Offices in all the provinces

Continuously investing in

our staff through study

support, internal training

and development

programmes

employees

As the supreme audit institution of South Africa, we are

well-respected locally and internationally

UN auditors for

12 yearsChair of the

Public SectorCommittee

Rio conferenceInternational key note address

Active

involvement

Secretariat host

African Union Current audit

Current audit

Support and

guidance

Record managementworkshop

Annual conference

Study toursLeading by example

As the supreme audit institution of South Africa, we are

a responsible citizen

Largest trainee auditor scheme

in South Africa

AGSA busariesThuthuka bursary fund

and accredited

universities

Support and uplift disadvantaged

communities in South Africa

Educational visits;

Boy and Girl learner days

1300+ trainee auditors

Centenary scholarships

(legacy project)

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Reputation promise of the Auditor General of

South AfricaThe AGSA has a constitutional mandate and, as the SAI of South Africa, exists to

strengthen our country’s democracy by enabling oversight, accountability and

governance in the public sector through auditing, thereby building public

confidence.

Our values

We value, respect and recognise all people

Our accountability is clear and personal

We are performance driven

We value and own our reputation

We work effectively in teams

We are proud to be South African

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Accountability and reporting

• The AGSA is accountable to the National Assembly to which it

reports annually on its activities and the performance of its

functions by tabling the main accountability instruments, namely

its strategic plan and budget and the annual report.

• The Standing Committee on the Auditor-General (SCoAG),

established in terms of the Constitution and the PAA, oversees

the institution’s performance on behalf of the National Assembly.

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Corporate responsibility

• It is important for the Auditor-General of South Africa (AGSA) to make an impact

beyond our constitutional mandate.

• Through its corporate social responsibility (CSR) programme, the AGSA makes an

investment in the well-being of those communities surrounding its operations and,

where possible, communities that the AGSA employees might choose to support. In so

doing, the AGSA aims to contribute towards the upliftment of those communities and,

consequently, the development of a positive reputation and image of the organisation

as a caring corporate citizen.

• Although the CSR programme is fundamentally linked with the ethical values of the

organisation, it addresses the following three values in particular:

– We value, respect and recognise our people;

– Our accountability is clear and personal; and

– We are proud to be South African.

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Our logo

• The logo is based on the image of a calculator or abacus, both of which are symbols

that lie at the heart of auditing. The logo is simple and uncluttered to suggest the

pursuit of transparency and public accountability, while the crisp blue (business) and

green (auditing) make a modern and thoroughly professional statement.

• The dynamic movement suggested by the ovals mirrors the fact that cost-effective

audits and examinations of all information received are performed constantly and that

diligent reporting to legislative institutions and the taxpayers takes place timeously.

• The green ovals represent the cornerstones upon which the Auditor-General’s activities

are based, namely integrity, accountability and transparency. All ovals are poised within

an encompassing base. This underlines the fact that the Auditor-General conducts its

affairs within the framework of a constitutional mandate and that it strives to preserve

the integrity, dignity and well-being of our country in order for South Africans to enjoy

the benefit of good governance.

Our strategy

• The strategic plan and budget that is aimed at the execution of the

updated long-term organisational strategy, termed The 4V strategy.

• The ultimate goal of the strategy is to build confidence in the ability of the public sector to deliver the necessary services for which it is the sole

provider in the country and, by association, to build public confidence in

the country’s democracy

• It seeks to provide direct links to the values entrenched in the founding

legislation, i.e. the constitutional values of democracy, transparency and

accountability

Strategic plan and budget

Strategic initiatives

4V (anchor) strategy

Balanced scorecard

Vision 2024

BU and Individual performanceCascading down of vision, goals, objectives and tasks

Achievement of tasks, objectives, goals and vision

DOCUMENTS USED IN THE

STRATEGIC ALIGNMENT

Originally the 10-point plan – this is the AGSA’s set of

aspirations for the public service.

These describe the desired end state of financial and

performance management in the public service.

The achievement of this vision will require a combined effort

of all players in the public service.

The AGSA is one of those players.

VISION 2024

This is the AGSA’s long term approach (2014-2024) to

achieving the Vision 2024.

This long term strategy is called the 4V strategy and the

rationale for it and the factors considered in its development

are described in the Anchor strategy document. An abbreviated

version is presented in the Strategic plan and budget 2015-18.

The anchor strategy is supported by short-term (rolling 3-year)

strategic plans.

THE ANCHOR STRATEGY

4V STRATEGY – STRATEGIC GOALS

GOAL 1

Value-add

auditing

GOAL 2

Visibility for

impact

GOAL 3

Viability

GOAL 4

Vision & values

driven

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STRATEGIC GOALS EVOLUTION

Strategic goals 2014-17 Strategic goals 2015-18

1. Simplicity, clarity and relevance of our messages

1. Value-add auditing

2. Visibility of leadership 2. Visibility for impact

3. Funding 3. Viability

4. Strengthen Human Resources

5. Lead by example Vision and values

driven

Value-add auditing

Demonstrate value-add auditing

Ensure high quality of our audits

STRATEGIC OBJECTIVES

Value-add auditing is focused on auditing areas that matter

and influencing all players in the public sector to utilise public

funds as intended for the benefit of the people of the country.

Achieve impact through

visibility programmes

Engage civil society, enable

active citizenry

Visibility for impact

STRATEGIC OBJECTIVES

The focus of engagement with stakeholders is on enabling and

compelling them to action. The required actions will be different

but with the goal of ensuring service delivery and holding

government accountable.

Viability

Maintain financial and legal viability

and independence

Embed the concept of

sustainability

Align internal

competencies and

capabilities

Increase operational

efficiencies

Increase internal

visibility

STRATEGIC OBJECTIVES

All elements that make AGSA viable and sustainable in a long

run are interdependent and are managed in an integrated way.

Vision and values driven

Continue to be a

transformational

organisation

Ensure our own

clean

administration

Increase the AGSA’s

brand presence

STRATEGIC OBJECTIVES

We will run our affairs appropriately, leading by example through

high levels of accountability, effective governance, such that we

are deserving of our independence.

PHASES OF THE JOURNEY TO VISION 2024

Strategic

goal

Strategic

objective

Time frame

Strengthen

Foundation

(Research and

innovation) phase

Implementation

(Processing/

Test) phase

Output (Reaping results)

phase

Y 0 Y1 Y2 Y3 Y4 Y5 Y6 Y7 Y8 Y9 Y10

Goal 1

Value-add

auditing

Demonstrate

value-adding

auditing

This is the specific plan for action

for the first 3 years of the AGSA’s

long term approach.

It defines the actions, the

strategic measures and

performance targets for the

organisation for the 2015-18

performance period. Adobe Acrobat

Document

STRATEGIC PLAN AND BUDGET 2015-18

STRATEGIC INITIATIVES 2015-18

Strategic

initiatives 2015-18

This is a supporting document to the strategic plan and budget

which describes the roles played by various business units in

executing the initiatives captured in the 3-year plan.

All items described in the strategic initiatives document must

be reflected in the respective BUs’ balanced scorecards.

TOP – DOWN ALIGNMENT SUMMARY

Vision 2024 and

the 4V strategy

Strategic Plan and

Budget 2015-18

Organisational BSC 2015-16

BUs BSCs 2015-16

Individual

Performance

Contracts 2015-16

Robust financial and performance

management systems

Oversight and accountabilityA competent and value-adding

auditor-general

Commitment and ethical

behaviour by all

Our aspirations for the public service

Main strategic projects that affects the audits

We integrate because we want:

A valuable and relevant product that is

the result of the efforts, skills and expertise of all our auditors

One unified audit team that provides

more in-depth, precise and relevant messages

A deeper understanding that goes beyond numbers and that

allows audits to focus on the things that matter.

Professional growth as individuals and audit teams

expand their skills and experience.

INTEGRATION-value-adding assurance provider

Expressed by the AG:

Value-adding input, based on deep insights into the state of the

public sector financial and service delivery performance that better enable integration and collaboration between all spheres and sectors of government.

AGSA Value Chain

INVESTIGATION

Key Drivers: Value Add

• Focus on things that matter:

� Materiality: For purposes of expressing opinions/ conclusions

� Impact: To support the achievement of government objectives (service delivery)

• Deeper knowledge of auditees’ needs and their business

• Integrated, holistic auditing (planning to reporting)

• Increased attention to the three E’s during auditing

• Provide value-adding recommendations and insights in our reports and quarterly engagements

• Enhance packaging of reports / messages

Integration strategy

• The integration strategy is driven by the Executives & backed by a change management process

• Integration factored into BSC’s and IPC’s

• There must be appropriate ownership by audit units to lead the integrated approach in providing value-add recommendations to auditees

• Strategic inputs of specialist units that will enable audit focus on areas that matter

BSC

V 1.1 Institutionalise mechanisms and structures for developing deep knowledge of the auditees’ needs, their business and value chains Train staff accordingly

Priority 1: Value chain analysis

V1.2 Intensify and institutionalise the use of publicly available information (statistics, NDP, MTSF, etc.) as a tool which, coupled with intensive data analytics, will drive efficiencies and will be able to provide value-adding insights across multiple audit teams – phased approach will be used from year one.

V1.5 Draw effectively on the breadth of specialist expertise available to the AGSA in each phase of the audit process to facilitate integrated, holistic auditing and boost the abilities of our audit teams.

Levels of integration

Desired state of integration

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VALUE FOR MONEY

Performance Auditing:

Looking at the 3Es

GOAL REACHEDBEST RESOURCE

BASED ON NEED

BEST RESULTS

USING WHAT WE

HAVE

SERVICE DELIVERY

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Conclusion

• In terms of the development of our audit office, we believe we

are both setting and being guided by quality benchmarks in line

with fast-moving global standards.

• This audit office’s primary role is to promote the principles of

good governance through accountability and, in doing so, to

enhance public sector good governance and effective service

delivery.