Chapter 2 - P rogramme 1 - Department of Defence

Defence-Related Industry in facilitating sales and
has facilitated discussions, where necessary, with
foreign roleplayers.
SUBPROGRAMME INSPECTION
SERVICES
Overview
The Defence Inspectorate Division has successfully
accomplished its mandate of providing independent,
objective internal audits, inspections and perceptions
surveys, as well as anti-corruption services which
have added value to the DOD operation. The
Defence Inspectorate Division has, during the
year under review, complied with all legislative
requirements in that:
•
•
•
the Audit Committee was duly constituted and
mandated;
it has established a system of internal audit to
ensure that departmental resources are utilised
effectively, efficiently and economically; and
it has compiled a rolling three-year strategic
internal audit plan based on its assessment of
key areas of risk in the Department.
To provide for the independence of the Defence
Inspectorate Division, its personnel report
administratively to the Secretary for Defence, who is
also the Accounting Officer. The Inspector-General
of the Department of Defence (IG DOD) reports
functionally to the Audit Committee, which is
responsible for approving the audit charter and the
annual internal audit plan. The Services Inspectors-
General are functionally under control of the Chief
Audit Executive (CAE), who is also the IG DOD,
but they are under administrative control of their
respective Service Chiefs.
Internal Audit
Internal Audit consists of both compliance and
performance audit, reviewing aspects of economy,
efficiency and effectiveness. The Division followed a
risk-based approach over three years, in accordance
with the Rolling Three-Year Audit Strategy.
The effectiveness of the Internal Audit Division
depends on the attitude and mindset of members
of the DOD. The AMC was required in
FY 2007/08 to act firmly against those managers and
commanders who ignored the recommendations of
the audit reports. As a result of audits conducted
on performance incentives, the Accounting Officer
was able to ensure that the implementation of the
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system was in accordance with his guidelines and
instructions. Audits were also conducted on the
ineffectiveness of the disciplinary legal system in
the DOD, where there are backlogs on sentences
and court orders, and where members who had
been charged were allowed to resign before being
arraigned. Chief Defence Legal Services was able to
implement measures to address the backlogs.
The DOD Annual Report for FY 2007/08 was
audited and certain Services and Divisions were
required to verify the performance information
contained in their reports. The performance
information as contained in the DOD First
Quarterly Report for FY 2007/08 was also audited.
The Defence Inspectorate Division is required by
law to be audited by external entities once every
five years. This provided a holistic overview of the
compliance by Defence Inspectorate Division with
the International Standards for the Professional
Practice of Internal Auditing (standards). The last
external audit was in 2006.
The Auditor-General’s audit qualifications were
included in the Three-Year Rolling Plan as followup
audits for FY 2008/09.
The Defence Inspectorate Division is subjected
to an annual audit by the South African Bureau of
Standards (SABS) with regard to the International
Standards Organisation (ISO 9001: 2000)
certification. A surveillance audit was conducted
on 12 February 2008 and the Defence Inspectorate
Division was able to maintain its Quality Management
System certification. The International Standards
for the Professional Practice of Internal Auditing
(IIA) require quality assessment of all internal audit
functions.
The Defence Inspectorate Division has engaged the
Auditor-General with the aim of fostering closer
cooperation on the scheduling of audits and the
reporting thereof. The Division has had exploratory
talks with a service provider who could assist in
training members to effectively audit financial
statements. The service provider will be contracted
early in 2008.
The training of members of the Defence
Inspectorate Division also received much attention,
with members completing courses on financial
management and internal auditing. The IG DOD
has embarked on a mission to increase the current
number of qualified Certified Internal Auditors
(CIAs).
55 Annual Report FY 2007 - 2008
| Chapter 2 - Programme 1: Administration |