Understanding Internal Audit Responsibilities in Municipalities

Internal Audit Approach Makhongela MM Limpopo Chairperson: CIGFARO

Table of Contents Introduction IA Responsibilities Accountability Cycle Key Activities Conclusion

Introduction The role of Internal Audit is clearly defined by the Institute of Internal Audit on its definition of Internal Auditing as Internal auditing is an independent, objective assurance and consulting activity designed to add value and improve an organization's operations. It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes.

Introduction The objects of Local Government indicates the responsibilities and Core Functions of the Municipalities. The focus of Internal Audit should be to assist Municipalities to achieve this objectives. How?? Internal Audit plan include both Audit of Performance Information and Performance Audits to assist the Municipalities to deliver services to the communities.

IA & Risk Management Responsibilities on AOPO Regulation 14 (1). (a) A municipality must develop and implement mechanisms, systems and processes for auditing the results of performance measurements as part of its internal auditing processes. Any auditing in terms of paragraph (a) must include assessments of the following:

IA Responsibilities on AOPO Cont.. (i) The functionality of the municipality s performance management system; (ii) whether the municipality s performance management system complies with the Act; and (iii) the extent to which the municipality s Performance measurements are reliable in measuring performance of municipalities on indicators referred to in regulation 9 and 10 (c) A municipality s internal auditors must - (i) on a continuous basis audit the performance measurements of the municipality; and (ii) submit quarterly reports on their audits to the municipal manager and the performance audit committee referred to in sub regulation.

IA Responsibilities on AOPO Cont.. (i) on a continuous basis audit the performance measurements of the municipality; and (ii) submit quarterly reports on their audits to the municipal manager and the performance audit committee referred to in sub regulation. To meet the IA definition of value add, internal audit need to develop a plan which will be aligned to the calendar of activities for the IDP, Budget and PMS processes.

Accountability

Key Activities Report Legal Mandate Key Deadline Tabling of Final Budget to Council and Approving any changes to the municipality s IDP Section 24 (1) & (2) of the Municipal Finance Management Act, At least 30 days before the start of the budget year i.e.: 31 May Approve the Service Delivery and Budget Implementation Plan [SDBIP] Section 53 (1) (c) (ii) of the Municipal Finance Management Act, Within 28 days of the approval of the municipal budget by Council Quarterly progress report on SDBIP Section 41 (1) (e) of the Systems Act, Section 166 (2) (a) (v) and (vii) of the Municipal Management Finance Act (MFMA) and Regulation 7 of the Municipal Planning and Performance Management Regulations. Within 30 days of the end of each quarter i.e.: 31 October, 31 January, 31 April, 31 July

Key Activities Report Legal Mandate Key Deadline Mid-year performance assessment (assessment report due by 25 January each year) Section 72 of the MFMA. Section 13 (2) (a) of the Municipal Planning and Performance Management Regulations 2001 By 25 January each year Annual report (to be tabled before Council by 31January) Sections 121 and 127 of the MFMA, as read with Section 46 of the Systems Act and Section 6 of the Systems Amendment Act. By 31 January each year

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