SALGA LIMPOPO MUNICIPAL FINANCE WEEK 7-8 FEBRUARY 2012

1. SALGA LIMPOPO MUNICIPAL FINANCE WEEK7-8 FEBRUARY 2012 Financial skills enhancement and professional development

2. A MUNICIPALITY IS A BUSINESS AND SHOULD BE RUN ON SOUND BUSINESS PRINCIPLES • Entrepeneurial skills • Available cash/resources • Planning • Targeted market niche • Product service delivery • Gearing for lessons learned

3. ENTREPENEURIAL SKILLS • Management and structures having an oversight role must be totally focussed and goal directed • Everybody must have their sights set on the target planned for • All deviations to plans must be adapted to immediately • Discipline is everything on the path to achieving success • Failure is not an option

4. CASH RESOURCES AVAILABLE • When compiling a budget ensure that you do the income budget first. • The cash must be available in your bank. • Or pledged by n.t. Ito of dora or mig • Never pledge funds before you have received them in your bank • Comply stringently with your revenue and debt collection policy (this is where support is needed most from oversight bodies) • Provide sufficiently for losses on debtors.

5. PLANNING • Revenue is conservatively forecast • Determine expenditure within the constraints of your income/cash projection • Scour yor expenditure to ensure that there is no unnecessary expenditure/cutback if there is. • Ensure that you do not cutback on maintenance and essential services or bypass statutory requirements

6. PRODUCT SERVICE DELIVERY • All products purchased in bulk must be re packaged and sold to consumers for a profit • Profits may not be exorbitant. (Industries in a metro claim to be paying double the price of electricity that the bulk tariff is that the municipality is paying eskom) • All consumer charges should be collected promptly to ensure that a sustainable cashflow is maintained • All statutory requirements must be complied with section 71 and such like reports

7. TARGETED MARKET NICHE • In public finance the market niche is determined by legislation • Try and maximise returns from your consumers without exploitation. • Install networks that are affordable to communities. • The public participation process when determining tariffs should never be treated lightly • In order for bills to be correct your databases must be updated and correct

8. GEARING FOR LESSONS LEARNED • Consultation with communities • Simplify local government finance legislation and standards to enable municipal finance officers to do produce their own annual financial statements • Ensure national and provincial oversight supports local councillors when contentious issues and protests surface.

9. PROFESSIONSLISATION • Municipal regulations on minimum competency levels • Achieve competence- qualification through unit standards versus notional study hour formal qualifications • Councillors can improve their lg finance knowledge to strengthen the civic knowledge in their communities

10. IMFO RECOGNITION AS A PROFESSIONAL BODY BY SAQA • 1988 imfo obtains statutory recognition, law 21 of 1988 dissolved in 2005 • Board for municipal accountants established in 1988, dissolved in 2005 • Recognised by saqa as a professional body in december 2012 • 2005-2012 no professional body for lg

11. IT IS NOW TIME FOR CLOSING RANKS • It is time to consolidate the focus areas of sector\provincial and local government focus areas and eliminate all of the costly nice to haves. • A national conference needs to be held to include the audit approach of the auditor-general to form a national strategy to improve audit outcomes.

12. Remember that genius is 90% perspiration and 10% inspiration • Let us take hands and combine all of our resources to create a better life for all in Thank You