Financial auditing for municipal internal auditors

South Africa has 258 municipalities of which more than 50% achieved qualified audit reports or disclaimers on their audit reports. It impacts on service delivery, has contributed to the credit risk adjustment by major rating agencies like Moody’s and has been emphasized by the Minister of Finance as a major focus of financial reconstruction.

The Auditor-general released his audit reports on local municipalities, and the deterioration of the financial sustainability of local authorities are severely hampering economic recovery and job creation in the country.  A summary of his reports can be read here.

COURSE CONTENT

The program will focus on the following:

• Understanding the role and importance of financial statements and audit opinions in the successful running of a municipality;
• A detailed overview of the important GRAP standards, how they impact on the financial statements and the audit opinion;
• Identifying the root causes of financial statements qualifications and or disclaimers;
• Auditing the processes that management should use to improve their audit opinions and reduce the likelihood of financial failure;
• Application audits based on GTAG 8 and 12 and 14;
• Auditing the process that ensure:
  • Asset recording and management;
  • Quantifying, recording and collecting debtors;
  • Supply chain management processes and the extensive misuse of these processes
  • Workflow management tools and their impact on retaining supporting documents for audit processes
  • Costing the budget in terms of the requirements of the MFMA to reduce the size of unauthorised expenditure in the public sector
  • Cash flow projections and cash flow management are reliable
• 75% of the training will be focused on practical application – analysing financial statements, annual reports, audit opinions, performing risk assessments and documenting process flowcharts.

Who should attend?

• Heads of Internal Audit of all municipalities with a current ratio of less than 1.5 : 1;
• Senior Internal Auditors with experience in financial related matters, who would like to focus their short term attention to key issues that influences sustainability of local authority;
• Auditors with a willingness to audit in the value creation space, and not in the value preservation space.
• Consultants to municipalities

Duration of training

Three days

Costing of the training courses

The cost of the training is R4 800 (ex Vat) per person and includes:

• the training material on an e-learning platform that can be used in the office after training, inclusive of videos, templates, and working papers.
• a certificate for 24 CPD hours.
• a free e-learning  module (two hours) on ethics for internal auditors equal to 2 CPD points, inclusive of videos, material and an online test that needs to be completed.  The test is open book and serves as proof that the material were covered.  Test can be re-performed on an unlimited basis.
• free access to the financial analysis, financial reports, best practices and sustainability analysis of all municipalities in the country for one year.
• free access to GRAP and IFRS e-learning tool with videos, summaries, key discussion points on latest AG reports and FAQ’s discussed by CFO’s.

Personal experience relating to the topic

1. Presenter for the Institute of Internal Auditors for a period of 20+ years on various topics relating to the public sector;
2. Specialist in governance, risk and controls
3. Presenter for the University of Stellenbosch, School of Public Leadership on the minimum skills requirements for all municipal managers, chief financial officers, supply chain managers and operational managers on various topics, including the management of financial statements and the financial analysis of municipal financial statements.