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2016/04/05
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Welcome to ACLTeam collaboration, remote work and continuous monitoring for the most sought-after teams
Dominic NelDominic NelDominic NelDominic NelHead of ACL South Africa
“Data analytics analyses data immediately. Identifying errors within the organization,
allowing companies to quickly react and mitigate the issue.”
2013
Who do we service
32of countries across Africa
4000happy customers across Africa
98%of the fortune 500
15 000happy customers across the globe
32of countries across Africa
4000happy customers across Africa
15 000happy customers across the globe
Risk Based AuditsRisk Based AuditsRisk Based AuditsRisk Based AuditsAre they assisting municipalities to deliver sustainable services?
“How many mistakes does it take before we consider something to be broken? Is 1%
inaccuracy sufficient? Would you be happy if 99% of your debtors paid you accurately?”
2016
King ll & King lll Reflection
King ll acknowledged the important role of an effective internal audit function
in good corporate governance.
King lll emphasizes that internal audit should follow a risk-based approach to
it’s plan. This is consistent with Section 165 (2) a of the MFMA (Municipal
Finance Management Act) which requires internal audit to prepare a risk-
based audit plan for each financial year.
King lll expects that the CAE or Head of Internal Audit’s, should:
1. Provide a constant assessment of the municipality's control environment
2. Discuss the adequacy of the resources and skills available to the CAE and Audit Committee
3. Internal audit planning and approach should be risk based rather than compliance based.
Clean audit
outcome
Financially
unqualified
audit opinion
Qualified audit
opinion
Adverse audit
opinion
Auditor General outcomes:
The financial statements are free from material misstatements and there are no
material findings or non-compliance with legislation.
Understanding Audit Compliance
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24% Financially unqualified
audit opinion41% Qualified or Adverse
audit opinions
Who got clean audits 2013/2014
2
4
013
0
2
2
0
17
Round of Applause!
City of Cape Town Metro
Cape Winelands District
Eden District West Coast District
Bitou
Breede Valley
Cape Agulhas
Drakenstein
George
Hessequa
Knysna
Langeberg
Mossel Bay
Overstrand
Swartland
Theewaterskloof
Witzenberg
Centralization. Automation. Predefined best practice.
How does ACL assist Municipalities?
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Objectives
Provide assurance
Process improvement
Add value to business
Manage exceptions
Reality
Request data from IT
Import, sort, format, normalize
Analyze data and identify
Report findings
Make Audit Valuable
VSVSLower Cost
Increase Coverage
Maturity Level 2 Maturity Level 3
Number of Tests
Time
Maturity Level 1
MANUAL(PROCESS &RISK BASED)
AUTOMATE
Adhoc Testing
MANUALMANUALMANUALMANUAL(RISK BASED)(RISK BASED)(RISK BASED)(RISK BASED)
AUTOMATED(PROCESS BASED)(PROCESS BASED)(PROCESS BASED)(PROCESS BASED)
Continuous Auditing
MANUALMANUALMANUALMANUAL(RISK BASED)(RISK BASED)(RISK BASED)(RISK BASED)
AUTOMATED(PROCESS BASED)(PROCESS BASED)(PROCESS BASED)(PROCESS BASED)
Continuous Monitoring
How has audit technology evolved
Continuous Auditing and MonitoringContinuous Auditing and MonitoringContinuous Auditing and MonitoringContinuous Auditing and MonitoringHow does Kobus feel about this?
“Data access is a hassle for analysts and a nuisance for IT. Stop having to be a pest. Build
trusted connections and test entire datasets during non-production hours.”
The Truth
What are our current challenges
Independent access to data Knowledge
Skills
Time
Type of technology
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How do we access data How do we access data
Secure Connection 100% Data Population Schedule
Independence Coverage Continuous
Scope of Analysis
CUSTOM
40%
COMPLIANCE SPECIFIC
Accounts Payable
Fraud
Salaries & Payroll
Vendor Management
Cash & Banking
Accounts Receivable
IT General Controls
Travel Expenses
Supply Chain
Conflicts of Interest
60%
ESSENTIAL
Municipal Continuous Monitoring Lotto
9Accounts
Payable
7Purchase Order
Management
16
Salaries &
Payroll
13
Vendor
Management
10
Revenue
Assurance
Accounts Payable
1. 3 Way Match - Where Invoice linked to a purchase order was not automatically paid
2. Duplicate Payments: Payments made to the same vendor for the same amount in the past 7 days
3. Duplicate Invoice: Same stripped vendor invoice number
4. Review where invoices paid are greater than the purchase order amounts approved
5. Review recurring sundry expenses
6. Review instances where vendor is paid by both purchase order & sundry expense
7. Identify invoices paid above threshold limit to determine authorisation process
8. Purchase order date after invoice date
9. Vendor payments made over a weekend
10. Extract all one-time vendors’ invoices for audit verification
11. Invoices captured on a weekend
For more information, please contact me: [email protected]
