Letter from the Acting Minister of Foreign Affairs to the Speaker of

the National Assembly, in terms of section 65(2)(a) of the Public

Finance Management Act, 1999 (Act No 1 of 1999), explaining the

delay in the tabling of the Annual Report of the Department of Foreign

Affairs for 2003-2004:

1. Section 40(1)(d) of the Public Finance Management Act No 1 of

1999, as amended, requires the Accounting Officer of the

Department to forward to National Treasury within five months

of the end of the financial year:

i) an annual report of the activities of that department, trading

entity or constitutional institution during that financial year;

ii) the financial statements for that financial year after those

statements have been audited; and

iii) the Auditor-General’s report on those statements.

2. Section 65(1)(a) of the Public Finance Management Act requires

me to table the said annual report and audited financial

statements in the National Assembly within one month after the

accounting officer for the department received the audit report.

3. In effect, the annual report and audited financial statements must

be forwarded to National Treasury on or before 31 August and

tabled in the National Assembly on or before 30 September.

4. The Department of Foreign Affairs did not comply with the

requirements of sections 40(1)(d) and 65(1)(a) of the Public

Finance Management Act in respect of the annual report and

audited financial statements for the 2003/4 financial year

because of the following:

4.1 The initial set of annual financial statements for 2003/4

were submitted to the Office of the Auditor-General on 31

May 2004, in accordance with section 40(1)(c) of the Public

Finance Management Act.

4.2 However, during the conducting of the audit work, especially

towards the end of the prescribed two months period

allowed to the Auditor-General in which to conduct audit

work, the Office of the Auditor-General brought to the

attention of the department that significant changes are

necessary to the department’s annual financial statements in

order to present a true account of the financial affairs of the

department.

4.3 The effecting of these changes to the annual financial

statements constituted material changes to these statements

and resulted in the re-submission of the statements.

4.4 In order to improve the preparation and presentation of the

information contained in the department’s annual financial

statement so that the statements reflect the true position of

the financial affairs of the department and to furthermore

ensure the standard of accountability and quality of information

expected by the South African public, the department

re-submitted its financial statements on 30 July 2004.

4.5 In accordance with section 40(2) of the Public Finance

Management Act, the Auditor-General is required to submit

an audit report on these statements within two months of

receipt of these statements. As a result of the re-submission

of the statements on 30 July 2004, the Auditor-General is by

law allowed a further period of 2 months from the date of

receiving the re-submitted statements in which to complete

audit work and issue an audit report. The audit report is

therefore expected on 30 September 2004.

5. In view thereof, it was not possible for me to table the

department’s annual report and audited financial statements in

the National Assembly, as prescribed.

6. The annual report and audited financial statements will be tabled

in the National Assembly during mid October 2004.

7. I trust that you will find this in order.

Yours faithfully