Review 3 final 2 - TAU - National Treasury

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TECHNICAL ASSISTANCE UNIT REVIEW | Performance Power and Governance reported as factual audit findings in the “Report on other legal and regulatory requirements” section of the auditor’s report. For audits of the 2009/10 financial year, in addition to the above and as part of the readiness strategy to prepare institutions for an audit opinion in the auditor’s report, an audit opinion was prepared and included in the auditors’ management reports for the following categories of auditees: • national and provincial departments, constitutional institutions and trading entities • national and provincial public entities • the administration of Parliament and of each provincial legislature • municipal metropolitan councils and their related municipal entities What were the major difficulties with implementation thus far The three broad areas which were identified to have weaknesses during the audit of performance information/objectives thus far include: • Non-compliance with regulatory requirements • Performance objectives not being useful • Reported performance not being reliable Identified root causes of non-compliance with regulatory requirements include, amongst others, inadequate management processes, non-compliance with internal policies and procedures or inadequate internal performance management operating procedures, deficiencies in key controls and no or limited review by internal audit of performance management processes and reporting. Further areas included inadequate training and guidance regarding performance management, monitoring and reporting processes and practices. Factors contributed to the findings of published information not being useful, included a lack of data definitions and technical standards relating to planned performance indicators and targets, performance indicators not being welldefined and verifiable, performance targets not being SMART and inconsistencies between planned and reported objectives, indicators and targets. Lack of integration of performance objectives structures and systems within existing management processes and systems as well as inadequate systems and documentation for identifying, collecting, collating, verifying and storing performance objectives impacted on the reliability of the annual performance reports. SMART Specific Measurable Achievable Realistic Time-framed Furthermore, a lack of sufficient and appropriate source documentation to verify the accuracy and completeness of actual service delivery achievements against plans were identified as the most important reason for published performance objectives not being reliable. It is reassuring to see how these issues have been taken up in the current reconfigurations within government administration as well as by Constitutional oversight bodies, such as the Legislatures, Commission for Gender Equality; the Public Service Commission et al (See Articles elsewhere in this publication that address governance and gender areas in terms of the Constitutional mandates). How will the next phase of AOPO be implemented The <strong>final</strong> phase of the implementation of the audit of performance objectives involves providing an audit opinion on reported performance objectives in the audit report itself. 10 page Enabling change for development
TECHNICAL ASSISTANCE UNIT REVIEW | Performance Power and Governance A further opportunity will be provided during 2010/11 to departments, public entities and high capacity municipalities and related entities to ensure their readiness for an audit opinion in the auditors’ report. In this regard these government institutions should ensure that proper corrective actions are instituted to address the basis of audit conclusions included in their management reports as issued during the 2009/10 audit cycle. Over the years, the AGSA continued with various stakeholder interactions to clarify the approach and essence of the audit of performance objectives. These initiatives will continue going forward. How can departments ensure that they comply Entities can move towards compliance by making sure that the legislation governing performance management and reporting is thoroughly understood and implemented. Furthermore, proper performance management systems should be put in place to ensure reliability of information/data and that effective communication and coordination within the organization exist. Investing in a strong internal audit division will also serve as a long term support system to ensure the credibility of reported performance objectives. Apart from ensuring that performance objectives systems are implemented properly, there has to be a credible process of monitoring and evaluation of actual performance achieved which is supported by relevant and sufficient source documentation. Performance management and reporting should not be viewed as another “burden”, but it should rather be looked at as an important part to ensure accountability and proper service delivery. The audit of predetermined performance objectives clearly gives ‘performance power’ to all 12 Outcomes of Government with robust and core evidence, too, in achieving “An Efficient, Effective and Development Oriented Public Service and an Empowered, Fair and Inclusive Citizenship”. (Outcome 12) 3 Tini Laubscher Senior Technical Manager Audit Research and Development Auditor General, South Africa 3 http://www.thepresidency.gov.za/dpme/docs/outcome12.pdf (downloaded on the 13 June 2011) page 11 Enabling change for development
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