DIRCO Annual Report

11. INTERNAL AUDIT AND AUDIT COMMITTEES The Chief Directorate: Internal Audit of DIRCO obtains its mandate from the Public Finance Management Act (PFMA), 1999 (Act 1 of 1999) as amended and its Treasury Regulations as amended. The Chief Directorate: Internal Audit is responsible for the internal audit function of the department. It reports administratively to the Accounting Officer and functionally to the Audit Committee. Activities and objectives of Internal Audit during the period included: • determining whether the department’s objectives were achieved economically, efficiently and effectively by evaluating and assessing operations, processes, procedures and activities • assessing, evaluating and offering recommendations for improvement on the department’s system of internal controls and governance • assessing and evaluating the departmental performance information • assessing and evaluating: -- the reliability and integrity of financial and operating information and the means used to identify, measure, classify and report such information -- the systems established to ensure compliance with those policies, plans, procedures, laws and other prescripts relevant to the department -- the means of safeguarding assets and, where appropriate, the verification of the existence of such assets -- the economic and efficient management of the department’s financial, human and other resources, and the effective conduct of its operations. For the period under review, Internal Audit has performed the following audit types at both Head Office and the missions: • compliance audits such as annual financial statement review, asset management, ICT reviews, etc. • consultations and/or management requests.

The purpose of the Audit Committee is to assist the department to fulfil its oversight responsibilities in relation to governance, financial reporting, the internal control system, risk management system and internal and external audit functions. Activities and objectives of the Audit Committee are to contribute to assist that: • the department implements and maintains effective risk management, control and governance processes • the department employs effectiveness, efficiency and economy in the utilisation and application of resources • management has implemented systems and mechanisms for the effective achievement of departmental objectives as planned • the department has and maintains an effective system of internal audit that reports at least quarterly to the Audit Committee in writing and submits a suitable progress report and summary of audit reports • the department conducts an annual assessment of all risks relevant to DIRCO and ensures that the department appropriately responds to risks identified • mechanisms and systems are implemented by management for the prevention, detection of and responding to fraud, theft and other irregularities as well as material errors and wasteful practices relevant to the department • the independence of the internal auditors is maintained • a structured reporting line for Internal Audit is provided and facilitates the maintenance of the objectivity of the internal auditors. The Audit Committee reviewed the activities of the internal audit function and has concluded that the: • the internal audit function is effective, with no unjustified restrictions or limitations • the internal audit reports were reviewed at quarterly meetings, including its annual work programme, the reports of investigations and the responses of management to issues raised therein. In respect of the coordination of assurance activities, the Audit Committee reviewed the

Department of International Relations and Cooperation

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