Report of the Standing Committee on the AG on having been consulted by the AG in terms of sect. 23(1) of the Public Audit Act regarding the AG's charge out rate for the period 1 April 2-7 - 31 March 2008

The Auditor-General annually determines a fixed charge out rate to be applied by private firms who conduct audits on behalf of the Auditor-General (AG). He does so after discussions with the South African Institute of Chartered Accountants (SAICA) and National Treasury (NT) in terms of S23(1) of the Public Audit Act, No. 25 of 2004.

The Committee was briefed by the AG on the charge out rate that he proposed determining for the period 1 April 2007 - 31 March 2008. The proposed rates increase was limited to a straight 4% increase on each level of the charge out rate agreed to between the AG and SAICA for the previous period, ie. 1 April 2006 - 31 March 2007. This increase was in line with the Auditor-General's own budgetary assumptions as included in its strategic plan for the corresponding period. The Committee was also furnished with a letter from the National Treasury that supported the proposed increase in rates.

Having considered the information furnished and having interacted with the AG on certain of the specific details, the Committee is of the opinion that the proposed increase is justified and reasonable under the circumstances.