Entire Document - Chris Hani District Municipality

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• Management has not taken sufficient action to clear all prior year audit findings. There was no audit intervention plan and certain matters in the management report as well as this report were also raised in prior financial years. REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS Report on performance information 36. I have reviewed the performance information as set out on pages 22 to 80. The accounting officer’s responsibility for the performance information 37. In terms of section 121(3)(c) of the MFMA, the annual report of a municipality must include the annual performance report of the municipality, prepared by the municipality in terms of section 46 of the Local Government: Municipal Systems Act, 2000 (Act No. 32 of 2000) (MSA). The Auditor-General’s responsibility 38. I conducted my engagement in accordance with section 13 of the PAA read with General Notice 616 of 2008, issued in Government Gazette No. 31057 of 15 May 2008 and section 45 of the MSA. 39. In terms of the foregoing my engagement included performing procedures of an audit nature to obtain sufficient appropriate evidence about the performance information and related systems, processes and procedures. The procedures selected depend on the auditor’s judgement. 40. I believe that the evidence I have obtained is sufficient and appropriate to provide a basis for the audit findings reported below. Non-compliance with regulatory requirements Lack of reporting on all predetermined objectives in annual report. 41. The municipality has not reported on all the predetermined objectives in accordance with the prescribed format, as required by section 46 of the Municipal Systems Act. 42. The performance report does not include comparison with the performance in the previous year, indication of measures taken to improve performance and the performance of each external service provider throughout the year, Lack of effective, efficient and transparent systems and internal controls regarding performance management 43. There is no person ultimately responsible for the co-ordination and managing of the reporting on progress against the pre-determined objectives. In addition, the roles, responsibilities and accountabilities for developing and evaluating output measures, collecting and compiling performance information, ensuring data integrity, monitoring and measuring data integrity and reporting the information are not clearly documented and communicated to all staff members. Content of integrated development plan (IDP) 44. The integrated development plan of the Chris Hani District Municipality did not include the key performance indicators and performance targets determined in terms of its performance management system, as required by sections 26(i) and 41(1)(b) of the MSA and regulation 12 of the Municipal Planning and Performance Management Regulations, 2001. Internal auditing of performance measurements 45. The municipality did not develop and implement mechanisms, systems and processes for the auditing the results of performance measurement as part of its internal audit processes and thus contravened section 45 of the MSA. 102
Usefulness and reliability of reported performance information 46. The following criteria were used to assess the usefulness and reliability of the information on the municipality’s performance with respect to the objectives in its integrated development plan: • Consistency: Has the municipality reported on its performance with regard to its objectives, indicators and targets in its approved integrated development plan? • Relevance: Is the performance information as reflected in the indicators and targets clearly linked to the predetermined objectives and mandate. Is this specific and measurable, and is the time period or deadline for delivery specified? • Reliability: Can the reported performance information be traced back to the source data or documentation and is the reported performance information accurate and complete in relation to the source data or documentation? The following audit findings relate to the above criteria: Inconsistently reported performance information 47. The following objectives recorded in the quarterly performance reports are not recorded in the IDP: • Ensure that hawkers comply with minimum standards • Implementation of training identified in the WSP • Implement keys to food safety training • Implement Health and Safety Programme 48. The following objectives recorded in the quarterly performance reports were not budgeted for in the SDBIP: • Implementation of Food safety • Implement Keys to food safety training • Implement NSF project • Implement Health and Safety Programme • Develop a sustainable brand for the institution 49. The IDP does not include a measurable target in respect of Nguni bulls to be purchased during the year and as a result the key deliverable could not be verified against the intended target. In addition, as per the SDBIP R1 million was allocated for this objective, but as per the annual performance report R5,2 million was budgeted. The actual expenditure was R5,1 million. APPRECIATION The assistance rendered by the staff of Chris Hani District Municipality during the audit is sincerely appreciated. East London 11 March 2010 103
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Table of Contents PART ONE: INTRODU
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PART ONE INTRODUCTION AND OVERVIEW
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providing us with your comments, vi
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SPECIAL PROGRAMMES SUCH AS YOUTH, W
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1.3.4 Values • Respect and Divers
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1.4 OVERVIEW OF THE MUNICIPALITY Mp
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SMME Development The District funde
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Corporate Services Directorate Ayan
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NAME OF SCHEME NUMBER OF MEMBERS AS
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organisation, can be seen to be inf
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2.1.4.5 Power Track Vehicle Managem
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2.2.0.1 Introduction A huge allocat
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In the 2008/2009 financial year Wat
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Integrated Planning and Economic De
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The implementation of housing co-or
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Livestock Improvement (Marketing Fa
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Chris Hani Month events Measurable
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Percentage Complete 99,9% Budget Sp
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Regional/LED Strategy Measurable Ou
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Health and Community Services Direc
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Due to the success of this project
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In observing HIV/AIDS days the CHDM
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Budget 2008/09 Key Deliverables •
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Challenges& Proposed Solutions Meas
Page 52 and 53: Budget Spent R125 000 Stakeholder/
Page 54 and 55: 2.4.4 Disaster Management UNIT This
Page 56 and 57: critical areas. 2.4.4.5 INCIDENTS O
Page 58 and 59: 2.4.5 Fire and Emergency Services U
Page 60 and 61: Stakeholders/partners Challenges Me
Page 62 and 63: 2.5.0.1 Introduction For the financ
Page 64 and 65: Key Deliverables • Asset identifi
Page 66 and 67: • The possible rescheduling/timin
Page 68 and 69: Project leader T. Somtombo/ M. Mash
Page 70 and 71: Measurable outcome Activities/Proje
Page 72 and 73: 72 Good Governance
Page 74 and 75: Communication strategy The District
Page 76 and 77: Stakeholders/partners Challenges Me
Page 78 and 79: 2.6.2 INTERNAL AUDIT Services UNIT
Page 80 and 81: Challenges Measurable outcome Execu
Page 82 and 83: The SPU coordinating committee and
Page 84 and 85: We would like to highlight and comm
Page 87 and 88: 3.1 Introduction to the Annual Fina
Page 89 and 90: 3.2 Audit Report to the Annual Fina
Page 91 and 92: APPENDIX A QUALITY MATURITY MODEL O
Page 93 and 94: 3.4 MFMA - Requirements The audit r
Page 95 and 96: IRONPORT LICENSES STATUS BEFORE 200
Page 97 and 98: provide sufficient evidence to iden
Page 99 and 100: 25. The mayor did not submit to cou
Page 101: No. Matter Y N •The audit committ
Page 105 and 106: The overall operating results for t
Page 107 and 108: 5. ACCUMULATED SURPLUS The balance
Page 109 and 110: 13. LONG-TERM RECEIVABLES Long-term
Page 111 and 112: 3.8 STATEMENT OF FINANCIAL PERFORMA
Page 113 and 114: 3.10 CASH FLOW STATEMENT FOR THE YE
Page 115 and 116: 1.1 Changes in Accounting Policy an
Page 117 and 118: Management has considered all the o
Page 119 and 120: 2.7 Heritage Assets Heritage assets
Page 121 and 122: The municipality did not perform im
Page 123 and 124: Based on management’s judgement,
Page 125 and 126: Cash includes cash-on-hand (includi
Page 127 and 128: 5.5 Derecognition of Financial Asse
Page 129 and 130: 7.3 Transitional Provisions The rec
Page 131 and 132: 9.2.8 Sale of Goods Revenue from th
Page 133 and 134: of performance bonuses only when th
Page 135 and 136: amount of the Municipality’s net
Page 137 and 138: Changes in Accounting Estimates are
Page 139 and 140: 2.1 Reconciliation of Provision for
Page 141 and 142: 4.3 Cash and Cash Equivalents 2009
Page 143 and 144: Description Land and Buildings Infr
Page 145 and 146: The movement in Intangible Assets i
Page 147 and 148: Study Loans In terms of the MFMA no
Page 149 and 150: Unspent Conditional Grants have bee
Page 151 and 152: The municipality provides certain p
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The history of experienced adjustme
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2009 2008 R R Present Value of Fund
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Interest Earned on Financial Assets
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The Financial Management Grant is p
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20.11 Provincial: Office of the Pre
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20.17 ProvinciaL: Department ROADS
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Remuneration of the Director: Finan
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25. Impairment Losses 25.1 Impairme
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29.1 Material Losses 2009 2008 R R
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Reserves Deferred Revenue Accumulat
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Operating Lease Liabilities R Accum
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The effect of the Correction of Err
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Incident Budgeted amounts exceeded:
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38.7 Non-Compliance with Chapter 11
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2009 2008 R R Own Resources - - 9 4
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The capital structure of the munici
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Description Note ref in AFS Average
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2009 2008 R R Long-term Receivables
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• The statutory valuation perform
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44. CONTINGENT ASSETS 2009 2008 R R
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Appendices 193
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3.13 Appendices to the AnnuAl FinAn
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Cost / Revaluation Accumulated Depr
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Appendix c - seGmentAl AnAlYsis oF
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Description 2008/2009 Actual 2008/2
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Annexure A Three Year Capital Plan
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Project Number (1) Project Name Fun
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Project Number (1) Project Name Fun
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AUDIT REPORT FINDING: PROPERTY, PLA
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AUDIT REPORT FINDING: IRREGULAR EXP
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Acronyms 215
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