Proposed changes to Public Audit Bill

Chapter 5

(to seek opinion of Madam Speaker as chairperson of the Rules Committee)

(changes sought through which to establish full and appropriate governance and accountability arrangements for the Auditor-General)

Audit Commission

Part 1: Establishment and Functions

Establishment

47. (1) That an Audit Commission be established to serve as the National Assembly mechanism in terms of sections 181(5) and 55(2)(b)(ii) of the Constitution (Act 108 of 1966).

(2) That the Audit Commission operates under the rules of the National Assembly.

Functions

48. (1) For the purpose of establishing arrangements necessary for the Auditor General to account to it, the Audit Commission must fulfill the following functions-

    1. advise the National Assembly on any matter referred to it by the National Assembly concerning the implementation of this Act;
    2. monitor the adherence to the principles of independence, impartiality and effectiveness by the Auditor-General as required by section 181 of the Constitution (Act 108 of 1996)
    3. seek to protect the name of the Auditor-General by reporting to the National Assembly should the independence, impartiality, effectiveness or the integrity and dignity of the Auditor-General be brought under question.
    4. annually appoint an independent external auditor to audit the accounts and financial statements of the Auditor-General, financial management in the administration of the Auditor-General and the performance of the Auditor-General performance information;
    5. examine the annual report and financial statements of the Auditor-General referred to it in terms of section 40(4), including the audit report on those statements, and report thereon to the National Assembly;
    6. examine and approve the annual budget, strategic plans and performance objectives before the tabling thereof in the National Assembly.
    7. monitor and report annually to the National Assembly on the adequacy of the quality assurance of auditing by the Auditor-General
    8. to obtain regular assurance from the Auditor-General as to the auditing standards employed in terms of section 23.
    9. establish an Audit Committee to approve an annual internal audit plan and risk assessment through which it will oversee the internal audit function and through this evaluate and report to the Commission regarding risk management, internal controls, management reporting and governance processes.
    10. make recommendations to the President in terms of section 7 on the conditions of employment of the Auditor-General.
    11. consider the Auditor-Generals recommendations regarding the appointment of a Deputy Auditor-General in terms of section 3
    12. advise the Auditor-General on any matter that the Auditor-General must or may refer to it in terms of this Act.

(2) The Audit Commission may contract for the services of consultants and other persons that may be reasonably required for the performance of its functions. Expenditure incurred in terms of this subsection must be defrayed from the funds allocated to it by the National Assembly.

 

Annual Report

49. The Audit Commission must annually submit to the National Assembly a report on its activities and the performance of its functions. The Commission must submit its report when the Auditor-Generalís annual report is submitted to the National Assembly in terms of section 40(4).

Part 2: Composition and membership

Composition

50. The Audit Commission consists of ten members of the National Assembly

Appointment

51. The members of the Audit Commission are appointed by the National Assembly in terms of National Assembly practice.

Chairperson

53. The Chairperson of the will be chosen by the Commission in terms of the National Assembly practice.

Conduct of members

54. A members of the Audit Commission must act with fidelity, honesty, integrity and in the best interests of the Auditor-General.

 

Termination of membership

55. (1) A member ceases to be a member of the Audit Commission if that person ceases to be a member of the National Assembly

    1. If the National Assembly is dissolved, the members of the Commission should continue in office as members of the Commission until new appointments are made in terms of section 51.

Part 3: Operating procedures

No changes recommended

Chapter 3

Searches of premises, vehicles and persons

Section 16

Recommend that we are guided by the advise of the Chairperson of the Justice portfolio committee

 

Audit reports on confidential, secret or classified accounts

Section 22

This section could be considered controversial in terms of transparency, independence, interpretation of "national interest", unauthorized expenditure process, due process, practice in other democracies etc.

As we do not know if the President/Executive actually wants this provision it is recommended that we first seek their views on the matter. If they believe it to be necessary, we should ask that they help us understand the necessity of its inclusion.

If we concede it to be necessary, then, if the amended section 5 is agreed to (Audit Commission) then we might consider adding the inclusion of the Audit Commission (under oath of secrecy if necessary) at any consultation (see 22(1)(b)).