BANKSETA ANNUAL REPORT 2023

CHIEF EXECUTIVE OFFICER’S REPORT

workplace-based programmes such as learnerships and internships. The programmes are beginning to bear fruit as some of the beneficiaries are transitioning into employment. We are planning a detailed tracking and tracing study to determine the efficacy of these programmes in the 2023/24 year onwards. We are humbled by the opportunity to play a part in helping the people of our country recover from the pandemic. We however recognise that the high rate of unemployment, particularly among the youth, remains a major challenge for all, and we must continue our efforts to develop skills in the banking and alternative banking sector to tackle this scourge. We continued to explore the benefits of technology in improving our operational environment. In the last quarter of the year, we launched a Management Information System to support our grant processes. The system supported the submission process of the Workplace Skills Plans and Annual Training Reports for employers to qualify for the mandatory grants in the 2023/24 financial year. Plans are afoot to expand The process to approve the rollover of funds did not proceed as planned. While the BANKSETA had undertaken all due processes and received support from the Accounting Authority, there was a breakdown in communication in our authorities at Department of Higher Education and Training and National Treasury. A response was received in the last two months of the financial year, however there was not sufficient time to factor any of the amounts in our spending plans. Furthermore, we were informed that the approval was not in line with legislation and discussions are continuing between National Treasury and Department of Higher Education and Training for the 2021/22 surplus of R1059 million. Because of this uncertain position BANKSETA ended the year with an uncommitted amount of R39 million. Supply Chain Management The Accounting Authority of the BANKSETA continued to provide guidance on maintaining appropriate and adequate internal controls which ensured compliance with all applicable SCM legislation. This ensured that instances of irregular expenditure and fruitless and wasteful expenditure were avoided. However BANKSETA continued to incur irregular expenditure arising from non-compliant processes of appointing some Accounting Authority members the system to the discretionary grant area. Request for Roll Over of Funds

in the Department of Higher Education and Training during 2020/21 financial year. The amount involved is R1,2 million (R1,3million in 2021/22). In addition, an amount R327 000 was incurred outside of SCM legislation owing to a need to urgently migrate data from the old MIS system. The irregular expenditure related to Accounting Authority appointments have been removed by the AA after following legislation. The irregular expenditure of R327 000 awaits a process of determination and condonement. BANKSETA did not approve any unsolicited bid proposals and all single or sole source procurement was approved by the Chief Executive Officer and duly reported to National Treasury and Auditor-General of South Africa in line with regulations. In response to the Auditor-General’s (AG’s) report for 2021/22, the internal control environment was strengthened leading zero material findings in the Supply Chain management area. BANKSETA is investigating possible criminal conduct in the amount of R25 000 relating to fraudulent documents submitted for discretionary grant projects. Audit Report Matters in the previous years and Action Plans Issues identified by the Auditor-General of South Africa in the previous year’s audit (2021/22) have been addressed through the application of more stringent internal controls and this was shown in the improved areas of our control environment. However, the outcome of our audit for the current year regressed BANKSETA to qualified audit report. The AGSA identified material misstatements during the audit of our project grant payables and discretionary grant expenditure. The problem emanated from records in the discretionary projects that could not support disclosed amounts. AGSA increased the scope of their audit of the Annual Performance Report to include two programmes namely Programmes 2 and 3. The main issues identified during the audit were the following: An indicator for Programme 2 that was not clearly defined during compilation of the Annual Performance Plan affecting the usefulness of the reported performance information. •

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BANKSETA ANNUAL REPORT 2022/23