ATC120523: Report on Independent Auditors on the Annual Reports & Financial Statements of the National Health Laboratory Services for the 2010/11 Financial Year, dated 23 May 2012

Public Accounts (SCOPA)

DEPERTMENT OF CORRECTIONAL SERVICES

ELEVENTH REPORT OF THE COMMITTEE ON PUBLIC ACCOUNTS ON THE REPORT OF THE INDEPENDENT AUDITORS ON THE ANNUAL REPORTS AND FINANCIAL STATEMENTS OF THE NATIONAL HEALTH LABORATORY SERVICES FOR THE 2010/11 FINANCIAL YEAR , DATED 23 MAY 2012

 

1. Introduction

 

The Committee on Public Accounts (the Committee) heard evidence on and considered the content of the Annual Report and the Report of the Independent Auditors on the 2010/11 financial statements of the National Health Laboratory Services. The Committee noted the unqualified audit opinion, highlighted areas which required the attention of the Accounting Authority, and reports as follows:

 

2. Compliance with laws and regulations

 

The Independent Auditors identified the following:

 

a) The Accounting Authority did not submit the proposed strategic plan to the executive authority for approval at least 6 months before the start of the financial year of the designated department, or another time period as agreed to between the executive authority and the public entity in contravention with the requirements of Treasury Regulations 30.1.1;

b) Contrary to the requirements of Treasury Regulations 8.2.3, payments due to creditors were not made within 30 days from receipt of invoice;

c) The Accounting Authority did not establish procedures for quarterly reporting to the executive authority in order to facilitate effective performance monitoring, evaluation and corrective action as required by Treasury Regulations 30.2.1; and

d) The entity did not have a fully constituted board of directors as a result of certain vacant positions stipulated in section 7 of the National Health Laboratory Services Act No. 37 of 2000.

 

The Committee recommends that the Accounting Authority ensures the following:

 

a) The entity comply with the relevant Treasury Regulations and ensures that the strategic plan is prepared and approved by the Board at least 6 months before the start of the financial year but not later than 1 April of each year;

b) Management seeks representation from the relevant constituencies so that adequate members of the board are appointed;

c) Procedures be established to guarantee that quarterly reports incorporate actual progress and performance relating to all objectives as per the Strategic and Annual Plan of the National Health Laboratory Services ; and

d) All invoices are paid timeously within 30 days from receipt of invoice.

 

3. Financial and performance management

 

The Independent Auditors identified the following:

 

a) The financial statements and performance information were subject to material amendments; and

b) Pertinent information was not identified and captured in a form and time frame to support performance reporting.

 

The Committee recommends that the Accounting Authority ensures that:

 

a) Financial statements are reviewed by appropriate delegated officials prior to them being submitted for audit so as to comply with the Public Finance Management Act and Treasury Regulations; and

b) The process for financial reporting be reviewed.

 

4. Conclusion

 

The Committee urges the entity to find possible interventions to collect the debts owed to them by the provincial Departments of Health.

 

The Committee recommends that the Executive Authority submits a progress report on all the above recommendations to the National Assembly within 60 days after the adoption of this Report by the House.

 

The Committee further recommends that the Accounting Authority submits quarterly reports on all the above-mentioned recommendations.

 

Report to be considered.