Treasury Internal Audit Framework Revised ... - National Treasury

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Introduction • The COSO 1 framework on internal control, as well as the risk management framework 2 . Against this background, the Framework aims to provide a standard set of guidelines regarding internal auditing in Government. Research and findings of assessments conducted in the past indicated varied levels of internal auditing practices within all facets of Government. The OAG believes that the Framework will set the tone and create the necessary impetus for a sustainable and effective internal auditing mechanism in government. This framework is not meant to be prescriptive and should enhance the quality and standard of public sector auditing. This document is a work-in-progress and stakeholders are welcome to provide input on an ongoing basis. The Framework can be customised to suit unique IAAs’ environments. 1.3 Legislative Mandate A number of pieces of legislations have been, or are in the process of being, enacted by 1 COSO framework, 1992 2 COSO ERM framework, published 15 July 2003 3 Internal Audit Framework
government. It is important that both the organisation and the IAA have at least a basic understanding of the requirements of these legislations, provided in summary below. 1.3.1 The Constitution of the Republic of South Africa Chapter 10, Section 195(1) & (2) of the Constitution states that: “Democratic values and principles that include, amongst others, a high standard of professional ethics; efficient, economic and effective use of resources; accountability and transparency must govern public administration. The principles apply to administration in every sphere of government, organs of state, as well as public enterprises.” Chapter 13, Section 215(1) of the Constitution states that “National, provincial, and municipal budgets and budgetary processes must promote transparency, accountability, and the effective financial management of the economy, debt and Public Sector 3 .” 3 RSA, The Constitution of the Republic of South Africa (Act 108 of 1996) National Treasury 4
Page 1 and 2: Internal Audit Framework
Page 3 and 4: The Internal Audit Framework is bei
Page 5 and 6: 2.5 Composition and Membership.....
Page 7 and 8: 5.1.4 Engagement Resource Allocatio
Page 9: • Be Public Service specific and
Page 13 and 14: Both the PFMA and MFMA make provisi
Page 15 and 16: 1.3.2.5 Internal control processes
Page 17 and 18: 1.4.3 Criteria of Control (CoCo) 6
Page 19 and 20: 2 Audit Committee (AC) 2.1 Introduc
Page 21 and 22: a management responsibility, manage
Page 23 and 24: • Monitor management’s implemen
Page 25 and 26: strategic objectives and overall co
Page 27 and 28: • AC members should not serve mor
Page 29 and 30: National Treasury the CAE, EA and t
Page 31 and 32: o The effectiveness of the interna
Page 33 and 34: much of the guidance required by IA
Page 35 and 36: the co-operation of the audit clien
Page 37 and 38: 3.2.3 The IA Charter 13 An IA chart
Page 39 and 40: 3.4 Developing an Internal Audit St
Page 41 and 42: The analysis: • Assesses the effe
Page 43 and 44: • Establish the timing of perform
Page 45 and 46: 3.5.1.2 Cyclical audits IAA may dec
Page 47 and 48: descriptions, clear goal setting, p
Page 49 and 50: operation to ensure that they are c
Page 51 and 52: There should be access to each othe
Page 53 and 54: IAA must be satisfied that the orga
Page 55 and 56: Preventive Controls A preventive co
Page 57 and 58: • Compliance with other generally
Page 59 and 60: acceptable operational practices an
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5 Audit Process The audit process i
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5.1.3 Engagement Scope 29 The scope
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The audit program must be compiled
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The IAA should document the informa
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The design and content of the worki
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5.2.5 Engagement Supervision 36 Sup
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and/or conclusions. Recommendations
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5.3.5 Disseminating Results 42 Enga
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• Verification of the response; a
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• Emergency consulting engagement
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activities that significantly affec
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• Seek any information it require
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Internal Control • Consider the e
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• Review any other reports that t
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identified during audits and, commu
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projects, ad hoc meetings and routi
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Treasury Internal Audit Framework Revised ... - National Treasury

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