Amendments proposed by Adv. Grove

Deleted text in brackets and bolded

e.g. [Audit Commission]

New text is underlined

e.g. Standing Committee on Public Audit

  1. Long Title

To give effect to the provisions of the Constitution establishing and assigning functions to an Auditor-General; to provide for the auditing of institutions in the public sector; to provide for a committee of the National Assembly to exercise oversight over the Auditor-General [in terms of the Constitution]; to repeal certain obsolete legislation; and to provide for matters connected therewith.

Reason: The Constitution does not stipulate the Auditor-General must have oversight performed by a National Assembly committee as implied by the deleted words.

Evaluation of Adv. Grove’s amendment: Agree

2. Definitions

"municipal entity’’ has the meaning assigned to it in section 1 of the Local Government: Municipal Systems Act, 2000 (Act No. 32 of 2000) [, and includes the governing body of a multi-jurisdictional municipal service district referred to in section 87 of that Act];

Reason: The Systems Act has now been amended to include the concept of a multi-jursidictional service district under "municipal entity". Hence there is no longer any need to mention multi-jursidictional service districts specifically.

Evaluation of Adv. Grove’s amendment: Agree

  1. Clause 4(2)(c)
  2. (c) a parent municipality and all municipal entities under its sole control as required by section 122 (2) of the Municipal Finance Management Act.

    Reason: Technical amendment to specify exactly which subsection of MFMA applicable

    Evaluation of Adv. Grove’s amendment: Agree

  3. Clause 4(3)(a)
  4. (a) any public entity [listed in the Public Finance Management Act]; and

    Reason: Public entity is already defined in section 1. The other reason why the words should be deleted is that the lists in Schedule 3 of the PFMA are incomplete. Apparently there are still many unlisted public entities.

    Evaluation of Adv. Grove’s amendment: Disagree, as we the Auditor-General cannot be legally bound to audit an auditee the Auditor-General is not even aware of. The listing provides certainty. Some public entities may also be deliberately delisted. The Auditor-General still has an option to audit, even if not listed in terms of clause 4(3)(b)

  5. Clause 4(4)
  6. (4) In the event of any conflict between a provision of this section and any other legislation existing when this section takes effect, the provision of this section prevails. Draft legislation which proposes to amend[s] this section may be introduced in Parliament only after the Auditor-General has been consulted.

    Reason: Amendment to clarify that draft legislation proposing to amend, and not actually amending this section, as only an Act of Parliament amends this section.

    Evaluation of Adv. Grove’s amendment: Agree

  7. Clause 10(2)
  1. In addition, the Auditor-General must annually submit a report to the National Assembly on his or her overall control of [his and her] the administration of the Auditor-General in terms of sections 30 (2) and 40(5).

Reason: Amendment to clarify and improve the grammatical language.

Evaluation of Adv. Grove’s amendment: Not necessary as committee specifically deleted "of the Auditor-General" and also replaced "and" with "or" in "his and her".

  1. Clause 13(1)(c)
  2. (c) procedures for the handling of complaints [in relation to the audit work performed] when performing such audits.

    Reason: Amendment to clarify and improve the grammatical language.

    Evaluation of Adv. Grove’s amendment: Agree

  3. Clause 14(2)
  1. Financial statements submitted by an auditee which is not subject to the Public Finance Management Act or the Municipal Finance Management Act, must be submitted within the period, be in a format, contain the information and otherwise comply with any requirements determined
    1. by any legislation applicable to that auditee; or
    2. in the absence of such legislation, by the Auditor-General.

Reason: Parliament is currently drafting PFMA type of legislation for the financial administration of Parliament and the provincial legislatures. This legislation will undoubtedly have very specific provisions on financial statements.

Evaluation of Adv. Grove’s amendment: Agree

  1. Clause 15(3)(a) and (b)
  2. (3) (a) A person who is required [by any enactment] in terms of any legislation to maintain secrecy or confidentiality, or not to disclose information relating to a matter, may be required by the Auditor-General to comply with any of the requirements in this section, even though the person would be otherwise in breach of that person’s obligation of secrecy or confidentiality or non-disclosure;

    (b) Compliance with a requirement of this section is not a breach of the applicable [enactment] legislation imposing the relevant obligation of secrecy or confidentiality or non-disclosure.

    Reason: Alignment of the term "legislation" with rest of the Bill.

    Evaluation of Adv. Grove’s amendment: Agree

  3. Clause 18(2)
  4. (2) Steps taken in terms of subsection (1) may not prevent the disclosure of any audit finding by the Auditor-General or an authorised auditor on any unauthorised expenditure, irregular expenditure or fruitless and wasteful expenditure within the meaning of the Public Finance Management Act or the Municipal Finance Management Act or any other legislation as applicable to the auditee which is the subject of the audit, or on any other irregular or criminal conduct relating to the financial affairs of an auditee, but any such disclosure may not include facts the disclosure of which would harm the national interest.

    Reason: As per clause 14(2) which states that Parliament is currently drafting PFMA type of legislation for the financial administration of Parliament and the provincial legislatures. This legislation will undoubtedly have very specific provisions on financial statements.

    Evaluation of Adv. Grove’s amendment: Agree

  5. Clause 25(3)
  6. (3) If the Auditor-General, within 14 days or such [extended] longer period as agreed to, of receiving a notice in terms of subsection (2) rejects the institution’s appointment, the institution must in terms of that subsection recommence the process to appoint another person as its auditor.

    Reason: Reason: Amendment to clarify and improve the grammatical language.

    Evaluation of Adv. Grove’s amendment: Not necessary

  7. Clause 28(3)(b)
  8. (3)(b) if the auditee has an executive authority within the meaning of the Public Finance Management Act, to that executive authority for [tabling in] submission to the relevant legislature;

    Reason: Cabinet members are the executive authorities of public entities. As members of the National Assembly they can only table documents in the National Assembly and not in the NCOP. But they can submit documents to the NCOP.

     

    Evaluation of Adv. Grove’s amendment: Agree

  9. Clause 28(4)(a)

(4) The report referred to in subsection (2) must be submitted-

    1. in the case of a public entity listed in the Public Finance Management Act, to the executive authority of the entity within the meaning of the Public Finance Management Act for [tabling in] submission to the relevant legislature; or

Reason: See cluase 28(3)(b) which states that Cabinet members are the executive authorities of public entities. As members of the National Assembly they can only table documents in the National Assembly and not in the NCOP. But they can submit documents to the NCOP.

Evaluation of Adv. Grove’s amendment: Agree

  1. Clause 38(1)
    1. The affairs of the Auditor-General must be conducted in accordance with a budget and business plan prepared by the Auditor-General for each financial year, [including projections for the following two-year period]. The budget must include
      1. estimates of revenue and expenditure, for the year to which it relates;
      2. projected revenue and expenditure for the two financial years following the year to which the budget and business plan relates; and
      3. the basis on which audit fees for the [periods] year to which the budget relates and the following two years are to be calculated.

Reason: Technical amendment to improve the clause structurally for logical flow.

Evaluation of Adv. Grove’s amendment: Agree

  1. Clause 38(4)
  1. The Auditor-General may, after consultation with the Audit Commission and the National Treasury, at the end of a financial year retain for working capital and general reserve requirements, any surplus as reflected in the financial statements, or a portion thereof, [The] Any portion not retained must be paid into the National Revenue Fund.

Reason: Amendment to clarify and improve the grammatical language.

Evaluation of Adv. Grove’s amendment: Not necessary

  1. Clause 39(2)(c)
  2. (c) [should] may not have any conflict of interest as a result of the[is] appointment.

    Reason: Technical amendment as the word "should" is not used in modern legal drafting.

    Evaluation of Adv. Grove’s amendment: Agree

  3. Clause 60(1)(b)

60(2)(b) any power or duty reasonably necessary to assist the Deputy Auditor-General in complying with a duty assigned in terms of this Act to the Deputy Auditor-General [to the Deputy Auditor-General] as accounting officer to take reasonable steps to ensure the achievement of a specific result.

Reason: The phrase "to the Deputy Auditor-General should remain" deleted by the committee should remain as it clarifies who the accounting officer is.

Evaluation of Adv. Grove’s amendment: Not necessary