Service delivery performance auditing

Presentation to the 6

th

annual service delivery

learning academy

Accountability and building confidence

Presentation by Tini Laubscher

Service delivery

performance

AGSA Reputation promise

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,

Impact of good governance

•

Enhanced service

delivery/business

goals

•

Accurate information

•

Financial gains

• Enhanced economic benefits

• Enjoyment of rights by citizens

• Poverty reduction

• Improved quality of life

Decision-making with the following consequences:

Terence Nombembe Auditor-General, South-Africa Accountability for Governance Conference, 2007

•

Accountability

•

Transparency

•

Compliance with laws,

rules and regulations

•

Economy, effectiveness

and efficiency

•

Consensus orientation

•

Participatory

•

Responsiveness

•

Equity and inclusivity

Decision-making and implementation with the following characteristics:

Good governance characteristics

Terence Nombembe Auditor-General, South-Africa Accountability for Governance Conference, 2007

Interdependency

GOVERNANCE CHAMPION INTERNAL AUDIT EXECUTIVE OVERSIGHT EXTERNAL

AUDIT Terence Nombembe

Auditor-General, South-Africa Accountability for Governance Conference, 2007

GOVERNANCE ACCOUNTABILITY

Key question

Does the mandate of the AG

speak to the challenges

The mandate

Section 20, Public Audit Act, 2004 (Act No. 25 of 2004)

(1) The Auditor-General must in respect of each audit referred to in

section 11 prepare a report on the audit.

(2) An audit report must reflect such opinions and statements as may be required by any legislation applicable to the auditee which is the subject of the audit, but must reflect at least an opinion or

conclusion on

–

(a) whether the annual financial statements of the auditee fairly present, in all material respects, the financial position at a specific date and results of its operations and cash flow for the period which ended on that date in accordance with the applicable financial framework and legislation;

(b) the auditee’s compliance with any applicable legislation relating to financial matters, financial management and other related matters; and (c) the reported information relating to the performance of the

The mandate …

Section 20, Public Audit Act, 2004 (Act No. 25 of 2004)

(

3) In addition, the Auditor-General may report on whether the

auditee’s resources were procured economically and utilised

Audit model

for good

governance

Essentials of Good Governance Algemene Rekenkamer, The Netherlands December 2005

Key question

Where do developments such as auditing

of performance information (aopi) and the

increased emphasis on performance

Performance information and

accountability

Performance information and

accountability

Policy development Strategic planning Implementation planning and budgeting Implementation End - year reporting

Oversight

by Parliament, provincial legislature or municipal council

INSTITUTION

national department provincial department

municipality state controlled institution

municipal entity

Specification of outcomes and outputs

Setting targets and resource allocation Monitoring and

management Evaluation and

adjustment

Identifying desired impacts

Policy development Strategic planning Implementation, planning and budgeting Implementation Year-end reporting Oversight

by Parliament, provincial legislature or municipal council

INSTITUTION

national department provincial department

municipality state controlled institution

municipal entity

Specification of outcomes and outputs

Setting targets and resource allocation Monitoring and

management Evaluation and

adjustment

12

AG strategy to aopi

Year

Approach

Report

2005-06

• Understanding of performance

information (PI) environment • Existence, consistency and

format

• Compare to source

Emphasis of matter in audit report

No impact on audit opinion

2006-07

• Understanding of internal

controls regarding PI • Document system

descriptions

• Existence, consistency and format

• Compare to source

No impact on audit

opinion. Report aopi audit findings in audit report – “other reporting

responsibilities” section

2007-09

Same as above with more focus

on systems generating pi

Same as above

2009-10

Audit procedures relevant to

providing reasonable assurance

Separate audit opinion on PI

“

Improving the quality of public service delivery has been a consistent theme of government’s policy framework and in the transformation of public service institutions since 1994.

Government is working to enhance performance management at all levels.

As an integral part of this initiative, the National Treasury and the Auditor-General have developed a programme performance information framework for strengthening performance management

and budgeting across national, provincial and local government.”

Budget Review - 2007 National Treasury

Categories of performance audits

Category 1 – VFM audits

Auditing of economy and efficiency at a basic level as part of the financial audits

Category 2 – Performance audits

Auditing the three Es for a specific focus area at an auditee

Category 3 – Transversal performance audits

Auditing the three Es for a transversal focus area, relevant to the main objectives of government and linked to service delivery at different auditees, at different tiers of government

“Certainly it is a reflection of weaknesses in the governance system that the plans to build

school infrastructure are unfolding at a much slower pace than envisaged.”

“We need massively to improve the management, organisational, technical and other capacities of government so that it meets its objectives.”

State of the Nation Address - 2005 President T. Mbeki

Examples of category 1 VFM audits

• HR management in the public sector

– Focusing on vacancies, workforce planning,

recruitment processes, bursaries,

management of leave

• Supply chain management

• HIV/Aids

– Focusing on both health and education

programmes

“

Infrastructure development provides

an enabling environment for transportation

and other key economic activities.

The 2007 budget adds R35 billion to capital

and infrastructure spending over the medium term …”

Budget Review - 2007 Minister Trevor Manuel

Category 3 performance audits

Transversal performance audits on infrastructure:

• Focus area selected considering quantitative and

qualitative criteria

• Performance audits covering infrastructure to extend

over a period of five years

• Aspects to be audited:

– Planning, design and tender processes

– Project implementation and commissioning of infrastructure projects

– Utilisation and maintenance of existing and newly built infrastructure