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SCoAG

SCoAG. Brief Summary of Audit Committee 17 June 2009. Reputation promise/mission.

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SCoAG

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  1. SCoAG Brief Summary of Audit Committee 17 June 2009

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

  3. Audit Committee Mandate • Was established in terms of section 40(6)(a) of the Public Audit Act. The committee acts as a control body and does not perform or assume any management responsibilities. It assists the Deputy Auditor-General in discharging his duties, as set out in section 43, relating to: • maintaining effective, efficient and transparent systems of financial management, risk management and internal control, and • maintaining an effective internal audit function.

  4. Audit Committee Mandate • In addition, the committee assists the Deputy Auditor-General in overseeing the following: • The approval of the criteria and procedures to be followed in the selection and appointment of external auditors, after which the committee makes its recommendation on the appointment of the auditors to the Standing Committee on the Auditor-General for approval. • The approval of the appointment of internal auditors and all activities relating to the internal audit function. • The examination and review of the preparations made to ensure accurate financial reporting and statements in compliance with all applicable legal requirements and accounting standards. • The review of reports from both internal and external auditors on the effectiveness of the risk management processes and procedures.

  5. Audit Committee Mandate • In terms of section 40(5)(a) of the PAA, the Audit Committee must comment in the annual report on the effectiveness of internal control and on its evaluation of the Auditor-General’s financial statements. • The Audit Committee may, in terms of section 40(6)(b), communicate any concerns it may have to the: • Auditor-General • external auditors of the Auditor-General • oversight mechanism. • The Audit Committee has terms of reference that are reviewed annually to ensure they remain relevant and are in compliance with applicable legislation. The evaluation of the committee against its terms of reference is reflected in the report of the Chairperson of the Audit Committee.

  6. Audit Committee Mandate Composition: • The Audit Committee consisted of four non-executive members. • As this, the first committee appointed in terms of the PAA, completed its three term, on the resignation of a member, it was decided that the committee should consist of 3 members with at least one member being rotated annually. • Therefore the three remaining members were re-appointed. Further details are in the Report of the Audit Committee. • The members are: • Peter Moyo • Prof Karen Barac • John Biesman-Simons

  7. Challenges • External auditors – contract work for AGSA vs external audit fees (This is a key short-term issue requiring SCoAG’s attention) • Bad debt of AGSA from non-paying auditees (Impact on cash flow) • Financial Turn Around Plan (Largely a historic issue, but being monitored)

  8. Conclusion • Any questions?

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