N5 – Module 3
The audit which is submitted to Parliament should satisfy The Legislature that the objectives and targets of the executive authority have been met. Much like the Public Protector, the Auditor- General must be totally independent of any political institution or government body – there should be no party political agenda or consideration in the execution of his/her duties. He/she is directly responsible to The Legislature and should at all times ensure honest management of public funds. The Legislature should be satisfied after reading the audit report that the execution of the approved budgets of income and expenditure has been done according to the priorities and in the manner stipulated by The Legislature.
Three different audits, according to Cameron (1995:65), are important: • Accounting audits: the examination of financial records to check for the correct recording of all transactions – this is much the same as an ordinary auditor.
• Appropriation audits: this audit records whether funds are being spent within a particular financial year and according to The Legislature’s wishes.
• Performance audits: this one goes further than the other two and looks at efficiency, economy, possible waste – it may also recommend changes for greater efficiency.
The priorities of The Legislature are clearly laid out in the annual budget in Parliament. Any deviation is, therefore, the business of the Auditor-General. Although the state auditor is appointed to investigate and report on the effectiveness and efficiency of the executive authority’s financial activities, he/she is not empowered to demand final accountability directly from the executive authority – this only The Legislature can do. It would be extremely unusual for The Legislature, though, to ignore the findings of the Auditor-General – instead, Parliament would accept his findings in the light of his role as an impartial and unbiased role-player.
The Auditor-General is: • a SA citizen with specialised knowledge and experience in auditing state finance and public administration;
• nominated by a joint committee of: the National Assembly & National Council of Provinces, without debate by an absolute majority of 2/3;
• appointed by the State President; • appointed for 3 and not more than 10 years; • removed by the President for misconduct or incompetence.
Gildenhuys (1993:93) says they should check for the following: • regularity and legality of management of public funds; • economy and the avoidance of waste of public funds; • efficiency and the optimum use of public resources, including personnel, stock, equipment and funds.
According to powers invested in the office, he/she has: • the right to demand any information concerning financial statements; • free access to all financial records, stock, personnel records and departmental accounts; • the power to summon any official to testify on matters regarding audits; • the right to determine (decide) whether public funds have been spent efficiently; • the right to makes enquiries on any matter concerning the activities of the executive and the administrative authority.
Public Accounts Committee Once the Auditor-General’s report has been submitted The Legislature needs to interpret its findings and act upon its recommendations. Few members of Parliament have the expertise to do this – instead they refer the report to a standing committee – the Public Accounts Committee. This committee is constituted on a proportional basis representative of all the political parties present in Parliament. It is the work of the members of this committee to interpret and communicate the findings to The Legislature, free of party politics or political bias. It would be expected of each political party to appoint someone within their ranks who is an expert on finance to serve on this
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