COGTA ANNUAL REPORT 2020

PFMA and Treasury Regulation 3.1.13. The Audit Committee also reports that it has adopted appropriate formal terms of reference as its Audit Committee Charter, has regulated its affairs in compliance with this Charter and has discharged all its responsibilities as contained therein. The effectiveness of internal control and Information and Communication Technology (ICT) Governance The Audit Committee is concerned with the regression in the internal control environment of the Department. The regression in the internal control environment of the Department mainly relates to the failure to implement prior year recommendations of the AGSA, inadequate review of performance information and compliance with laws and regulations in the Supply Chain Management function. Some deficiencies in the system of internal control and deviations were reported in the Internal Audit Reports. SCM still remains an area of concern in light of the external audit findings. The Audit Committee note the implementation of IT Governance and systems as substantiated in the external audit report. The Department did not satisfactorily implement the recommendations AGSA and Internal Audit findings raised in previous years. The Audit Committee also reviewed the progress with respect to the IT Governance in line with the ICT Framework which confirms that the Department maintains adequate IT Governance controls. Some progress was made by the Department to implement and monitor its Disaster Recovery Plan and Business Continuity Processes. The following internal audit work was completed during the year under review: • Supply Chain: Tenders, Contract Management and Procure to Pay • Follow Up AG Findings • Follow-up audit on transfer of grants to Merafong municipality (Disaster Management Grant) • Performance Information audit /Performance of the department against predetermined objectives • Data analysis- SCM / HR / FIN (Q2) • IT risk assessment • Data analysis- SCM / HR / FIN (Q4) • The following were areas of concern: • Disaster Management Grant; and • Performance Information. Internal Audit The Audit Committee is satisfied that the Internal Audit plan represents a clear alignment with the key risks, has adequate information systems coverage, and a good balance across the different categories of audits, i.e. risk-based, mandatory, performance, computer and follow-up audits. The Audit Committee is satisfied that the internal auditors consulted with Management, Auditor General and the Audit Committee on its Internal Audit Plan. The Audit Committee has noted considerable improvement in the communication between the Executive Management, the AGSA and the Internal Audit Function, which has strengthened the Corporate Governance initiatives within the Department.

The coordination of efforts between internal audit and AGSA have been enhanced further during the year in the provision of assurance services. The Committee believes this is an important step towards a fully effective combined assurance.

G A U T E N G P R O V I N C I A L G O V E R N M E N T I C O- O P E R A T I V E G O V E R N A N C E A N D T R A D I T I O N A L A F F A I R S ANNUAL REPORT 2019/20 77