M A Y 2 0 1 2 • S A S O L D I E R - Department of Defence

S A S O L D I E R2009 review of defenceOperation CLEAN AUDIT -It starts with YOU!responsibility forthe implementationand ultimate successof Operation CleanAudit (OCA) rests“Thewith everybodywithin the Department and I, theDeputy Minister of Defence andMilitary Veterans, have pledged myfull commitment and co-operationto ensuring that the Departmentachieves a clean audit in theforeseeable future. I urge you to do thesame; remember it starts with you,”said the Deputy Minister of Defenceand Military Veterans, Mr ThabangMakwetla, commenting on OperationClean Audit.Operation CLEAN AUDIT (OCA)is an initiative of the Departmentof Defence (DOD) to clear the auditqualifications for the Department.The Auditor General of South Africahas for the past four financial yearsissued a qualified audit opinionon the financial statements of theDepartment of Defence. The AuditorGeneral has a constitutional mandateas the Supreme Audit Institution(SAI) of South Africa. SAI exists tostrengthen our country’s democracyby enabling oversight, accountabilityand governance in the public sector,thereby building public confidence.The biggest challenge for theDepartment, as is the case in mostof the government, is that thecurrent systems, in particular thefinancial management system,does not necessarily support allthe requirements for the DOD tocomply with the relevant accountingstandards and the Public FinanceManagement Act (PFMA). Otherfactors that are inhibiting the DODfrom complying with the PFMAinclude the inherent challengesin developing and implementingkey internal controls within theDepartment and non-compliancewith the relevant policies andprocedures. This has led to theDOD not being able to account forand report on its resources for thepast number of years.These problems are compoundedfurther by capacity constraintsfacing the Government ingeneral, and the lack of skillsand competencies required inaccounting and auditing.All these known factors havedirectly and/or indirectlycontributed to the DOD receivingthe qualified audit reports from theAuditor General.How Operation CLEANAUDIT aims to assistthe DOD in achievinga clean audit reportThe approach adopted by the OCAteam is to assist the DOD, firstly inidentifying and confirming all of theroot causes of the audit qualifications,secondly to put measures in place toaddress these root causes, includingdeveloping and implementingimproved policies and procedures andinternal controls, and thirdly to trainand provide DOD employees with theskills to perform their duties moreefficiently and effectively.The ultimate objective is to achievequality financial reporting and toadopt an adequate system of internalcontrols as well as improved policies,procedures and ensure adherencethereto, all of which are critical toachieving a clean audit report.The OCA team is made up of membersof the DOD and a team of externalconsultants who have been brought into provide the DOD with the additionalcapacity and the accounting andauditing skills and expertise requiredto carry out a project of this nature.Mr Thabang Makwetla, DeputyMinister of Defence and MilitaryVeterans.However, the ultimate responsibilityfor implementing the solutions beingintroduced by the OCA team restswith every member of the DOD.ProgressThe project is currently in its ninthmonth of implementation and therehas already been progress duringthe 2008/09 financial year in whichthree audit qualifications fromthe previous financial year havenow been cleared. Roadshows arecurrently being planned in which theteam will share more details on theproject with everyone affected andprovide some basic training in whatis required of them to participate inand contribute to achieving a cleanaudit report. So look out for theroadshow near you and remember: Itstarts with YOU!(For more information please readthe article as published in SA Soldier,October 2009 edition, page 46.)12 • M A Y 2 0 1 2