Loading in 2 Seconds...
Loading in 2 Seconds...
PRESENTATION TO PARLIAMENTARY PORTFOLIO COMMITTEE ON HIGHER EDUCATION AND TRAINING 26 FEBRUARY 2014. AGENDA Introduction Strategic overview Vision, mission, values 2012/13 financial performance 2012/13 annual report Auditor General’s report 2012/13 non-financial performance
Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.
PORTFOLIO COMMITTEE ON
HIGHER EDUCATION AND TRAINING
26 FEBRUARY 2014
SKILLS DEVELOPMENT INCOME: SUCCESSIVE YEAR ANALYSIS
Levy income generated continues to rise with the increase in employment statistics of employers. Investment
Income however, reported a steady decrease in comparison to earlier financial years.
DISTRIBUTION OF LEVY INCOME – 2012/2013
LEVY INCOME: PROVINCIAL ANALYSIS
Levy income reported an overall 8% increase from 2011/2012 to 2012/2013 levy. The usually highest
participating region, Gauteng, reported decreased margins compared to other smaller provinces,
namely, Western Cape, North West, KwaZulu-Natal and the Eastern Cape.
DISTRIBUTION OF BUDGET VS. EXPENSE
Discretionary Grant projects were at a minimum in 2012/2013. Many projects that were intended for
engagement did not materialise as SCM processes were hampered in advertising tenders.
Mandatory Grant disbursement under performed to budget by R19.9 million in 2012/2013 in comparison to
2011/2012 where disbursements exceeded budget. However the total disbursed in 2012/2013 exceeded
that of 2011/2013, this is due to higher SDL being paid by employers thus an increase in employment statistics.
2010/2011 realised a deficit, whereas 2011/2012 and 2012/2013 realised surplus funds which were swept to the
discretionary fund reserve of R728 thousand and R62,154 million respectively.
Accumulated reserves has risen by R49 million since 2009/2010. This is mainly due to a minimum of Discretionary
Grants projects being rolled out in the fiscal year 2012/2013. Committed funds at year end were R153 million.
An application to retain the reserves was instituted in 2013/2014, this application was granted.
Other matters of emphasis were:
Restatement of figures in the annual financial statements;
Finalisation of review of schedule of opening balances, has been done and opening balances has been restated.
Predetermined performance objectives were found to be inconsistent, not specific, not verifiable, not well defined and unreliable.
This has been noted and has been addressed in the 2014/15 Strategic plan and APP.
Compliance with Laws and Regulations:
Annual Financial Statements, Performance Report and Annual Report were not prepared in accordance to section 55(1)(b) of the PFMA.
Material misstatements were recorded in the Annual Financial Statements.
Some of these misstatements were corrected, misstatements not corrected at year end were on commitments which resulted in the qualified opinion.
An adequate year end plan to submit financial statements with no material misstatements in place.
Non compliance to Treasury Regulation 27.2.1, the Accounting Authority did not approve a risk management strategy which was included in the fraud prevention plan. This was also not communicated to employees to ensure that all emerging risks of the entity were identified.
Full implementation of corrective processes as per risk assessment is underway.
Procurement Contract and Management, non compliance to Treasury Regulations prescribing 3 price quotations, a competitive bidding process, adherence to the PPPF, expansion of contracts above 15% of the original contract value, as well as non compliance with the Income Tax Act by not withholding and paying over 25% to SARS.
The Supply Chain Management Policy has been finalised and implemented and complies with the relevant legislation.
There were no preventative steps to prevent irregular expenditure and fruitless and wasteful expenditure as required by the PFMA.
Approval processes are in place to prevent irregular expenditure and fruitless and wasteful expenditure as required by the PFMA.
Internal controls were not designed an implemented effectively to ensure the leadership function carried out its duties with honesty, ethical business practices and in the best interest of the entity.
Financial and performance management:
Improvements in financial and performance management were not fully realised.
The review and monitoring controls were not effective in preventing and detecting misstatements in the financial statements and supporting information disclosures in the financial statements
Internal control processes have been reviewed and improved to comply with the requirements of the finding.
Management did not implement appropriate risk management activities to ensure that regular risk assessments, including consideration of IT and fraud prevention.
Management has completed a risk assessment process and the internal audit plan has been developed based on the risk assessment.
The Accounting Authority, other governance structures and internal audit did not appropriately address identified internal control deficiencies and non-compliance with laws and regulations reported in the prior year and during the interim audit.
The internal audit function was not functional through out the year.
An adequate risk based internal audit plan is currently being implemented. Certain sections have already been completed and audit reports submitted to management.
ETQA, Learning Programmes, SSP
The current organisational structure is outdated and misaligned to the organisational mandate. Since 2010, the organisation has been going through a reorganisation process which had still not been finalised as at the end of the year in review. As a result, there was a moratorium placed on all recruitment until November 2012 when the Board directed that limited duration contractors should be appointed to create capacity. Contractors were appointed outside of the approved structure.
The list includes all staff movement including positions that were additional to the establishment but excluded the interns*
Other matters of emphasis were:
An IT strategic plan was not designed to support the strategic objectives of the organisation;
A new ICT strategic plan is under development.
Unapproved Information and Technology Governance Framework
LGSETA has adopted the DPSA CGICT Policy framework.