CIGFARO Conference 2017: mSCOA and Expenditure Management Presented by National Treasury Local Government Budget Analysis: 10 October 2017

mSCOA Regulations: The Regulation on a Standard Chart of Accounts for Municipalities (mSCOA) was promulgated on 22 April 2014 – the implementation deadline for all municipalities and municipal entities was 1 July 2017 When do we see the benefits of the reform? What should be expected in terms of benefits? More than 70% of ICT implementations fail because they: Run over budget; Run over time; and Do not achieve the anticipated benefits Limited change management; unclear business case; ending the implementation at go-live or partial go-live.

mSCOA and Expenditure management: Employee related cost: Up to 30% and more of total annual expenditure Approved organisational structure/ organogram HR budget linked to approved positions Plan for filled and vacant positions Link positions to strategic and service delivery objectives

mSCOA and Expenditure management: Unfunded mandates: Fund segment – how will expenditure be funded Function segment – core and non-core functions Costing segment – cost reflective tariffs Reliable and comparable information allows for accurate calculation and distribution of grants and subsidies Link positions to strategic and service delivery objectives

mSCOA and Expenditure management: Improved internal control as business processed are system driven Audit trail for transactions, including financial and non-financial information Higher level of skills required – development of resources Automated processes will result in reduced administration and reporting Reliable, comparable and transparent information, including dashboards and “drill down” functionality Improved planning, service delivery and reporting, supported by technology

How do we get there?

Questions