Status on the submission of AFS & standards of Grap

LGA: AFS Submission & GRAP Updates
06 September 2013
Table of contents
1. Introduction
2. Submission of Annual Financial Statements
3. GRAP Updates
4. Way Forward
 The legal framework on the submission of AFS is stated in the MFMA Sec.126(1)(a),
where the Accounting Officer of a municipality must prepare AFS within two
months after the end of the financial year to which those statements relate and
submit the statements to the Auditor –General for auditing.
 Furthermore, Sec.133 states that in the event of non-submission of AFS certain
processes have to be undertaken amongst others such as the Mayor tabling a
written explanation in council setting out reasons for the failure to submit etc. The
municipality should ensure that processes outlined in Sec 133 of the MFMA is
adhered to.
 Though submitting AFS within legislative timelines is important, it has to be
balanced against reliability (producing reliable and accurate information).
Submission of Annual Financial Statements
 Timely and accurate financial reporting is essential for effective decision making,
more effective and timely management of public funds and enhancing public
 According to the A-G schedule on submission of AFS for 2012/13 financial year one
municipality had not submitted AFS as required by the MFMA
 The trend for the past three years on submission by the timelines reflects that
2012/13 (96.6%); 2011/12 (86.6%) & 2010/11 (60.0%); this represents a significant
improvement in 2012/13 financial year when compared to the previous years;
 It is important to note that delayed reporting reduce the relevance and usefulness
of the information reported and tends to erode the trust of its constituents.
Submission of Annual Financial Statements
Western Cape Municipalities
Submission of Annual Financial Statements
WC Municipalities
GRAP Updates
 PT compiled report on the issues raised during session on GRAP Standards for further
interpretation and guidelines with practical examples on the following Standards:
(GRAP 21 & 26 ; GRAP 23 ; GRAP 24 & GRAP 103);
 Session was held in Eden District discussing ED 110 – Post Implementation Review of
Selected Standards of GRAP (GRAP 16 & 17) to provide comments to the ASB, and
comments received during the session were communicated to all CFO’s for any
additional comments and the due date is the 18 October 2013 to ASB;
 The overview on the comments provided in the session indicated that on the
Institutional Environment: impact on the IT system, Organisational Environment
asset management system and working relationship between accountants and
engineers and on Individual skills and Competencies: capacity of staff on GRAP
Way Forward
 To assist municipalities to prepare timely and quality financial statements, PT will
conduct quarterly visits to workshop a detailed year-end AFS preparation plan that
outlines critical activities and milestones to be achieved;
 Key reconciliations prepared by municipalities will be checked by PT on a quarterly
basis to ensure that key accounts are up to date.
 There should be more participation on the ED’s issued; by both PT and Municipalities
in the Province by means of communication and arranging sessions to deal with any
implications that the municipalities might have once the new GRAP Standard has
been approved and effective by ensuring that comments are provided to the ASB;
 PT will organise training on GRAP Reporting Framework for 2013/14 Financial year.
Thank you

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