Auditor General briefing to Parliament

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The Auditor General and his Deputy briefed the Parliamentary Monitoring Committee on Finance extensively on the 2007/08 Annual Report. Here is the presentation they made. Highlights include:

• The Office of the Auditor General (OAG) was engaging more positively and proactively with stakeholders.
• Interventions with the provincial MECs of Finance had shown good results.
• Engagement with local municipalities was also proving useful, showing improvements in motivation and commitment and planning.
• The OAG did, and would continue to, contract out work to private audit firms, many of them newly emerging black firms, and was in this way improving capacity, training and transformation in the profession.
• Its international participation was described, and it was reported that OAG would assume the Chair of the international body of Auditor Generals from October.
• The financial statements showed a deficit of R8.3 million instead of the anticipated surplus. This was largely as a result of more work being contracted out than anticipated. OAG did not earn a profit margin on such work, and although it recovered its fee output, it did not in fact recover the administrative costs. Full details of the income were tabled and explained.
• There had been high provision for debt – much owed by municipalities – and further cleaning up of the balance sheet had revealed several further small non-recurring amounts to be written off or corrected, totalling R3.9 million.
• A comparison of performance against budget was tabled, as well as a comparison of projected and actual targets. OAG had achieved an unqualified audit, and was working hard to maintain this and to ensure that governance remained strong in every business unit.
• Debt collection for national departments had improved, although it was still problematic at municipal level. Funding bottlenecks had been addressed.
• There would be ongoing challenges in capacity, because of the shortage of skills in the whole profession, but the OAG would both safeguard its own position and continue to involve private audit firms.