1. PT and NT oversight role
Presented by National Treasury

2. No system can ever be compliant / It may be mSCOA enabling
Compliance
When: 1 July 2017
Implementation Delegated to: Accounting Officers/ Chief Financial Officers/ Project Managers,
NT / PT Roles: Technical support to municipalities, monitoring progress and implement corrective measures
However the responsibility remains with Councils and boards, numerous efforts were made in providing training, issue circulars, direct engagements and open door policies.
No system can ever be compliant / It may be mSCOA enabling

3. What entails mSCOA Compliancy
The object of these Regulations is to provide for a national standard for the
uniform recording and classification of municipal budget and financial information at a transaction level.
may not contain data which is mapped or extrapolated or which otherwise does not reflect transactions recorded or measured by the municipality or municipal entity.
The standard chart of accounts of a municipality or municipal entity-
(a) must contain the segments in the Schedule as required by regulation
4(1);
(b) must accurately record all financial transactions and data in the applicable segment; and
The financial and business applications or systems used by a municipality or municipal entity must-
(a) provide for the hosting of the general ledger structured in accordance with the classification framework determined in terms of regulation 4(2);
(b) be capable of accommodating and operating the standard chart of accounts
Each municipality and municipal entity must have, or have access to, computer hardware with sufficient capacity to run the software which complies with the requirements in sub-regulation (2).
It is important to note that all the above require a data extraction loaded to the LG database portal.

4. Version 6 of the Chart must be used to budget.
Non Compliant
Compliant
Non Submission of the IDP by End November (Project, Function Region)
Non Submission of Budget by end of March (Project, Function, Item, Fund, Region and Costing)
Not going live on 1 July 2017 with full integration to sub-systems.
Data string upload to the portal by due dates and compliant to:
No Mapping.
Use of all segments.
Seamless integration.
Integrated budgeting linked directly to IDP and SDBIP.
Version 6 of the Chart must be used to budget.

5. mSCoA Effective Implementation Plan
Provincial Treasury
• Appointment of PT Project Manager
• Functioning of provincial mSCoA Steering Committee
• Assessment on the implementation of mSCOA circulars by municipalities
• Consistently assess mSCOA compliance (MFMA Circular 80)
Communication (training, circulars, direct engagements)
Municipalities/municipal entities
Appointment of Project Manager
• Functioning of mSCoA Steering Committee
• Implementation of mSCOA circulars
Implement mSCoA Financial System (transversal tender if applicable)
Link IDP projects to budget
Compile mSCoA compliant budget for 2017/18 in Version 6 of the chart
Converted opening balance (historical data and information)
mSCoA ready system installed and ready for testing
mSCoA ready system configured and Live
mSCOA data submitted to NT and verified
Link current trial balance to mSCoA trial balance

6. Provincial Status Summary
National Treasury

7. Consolidated Evaluation by PT’s/Advisors
National Treasury

8. mSCOA Aligned to MFMA Calendar: The journey to success…
Budget process:
Populate the Municipal running cost and Maintenance & repair Projects;
Functions will need to link the required Items to deliver the Projects;
Align the IDP with available resources (Funding & Revenue Items ); and
Determine the Costing module and finalize tariffs.
IDP process:
Needs to begins with in the prescribed period from 3 August 2016.
July till September
October till November
January Till March
Finalization of the chart
Budget Approval process
Create SDBIP based on Budget.
Community Participation:
Identify Projects (Capital and typical work streams);
Identify Regions of these projects; and
Identify the Function that need to deliver the projects.
March till June
Implementing the new chart of accounts and carry over of the legacy items opening balances. Note restatements for 2018/19 year.
1 July 2017

9. In conclusion… Status review: Budget submission:
Confirm the status of each of your municipalities
Focus on the 46 “red” municipalities to ensure that they cross the line in time – call the MM and CFO to the PT/ NT office, discuss the challenges and initiatives to address these, engage the vendors to ensure their support.
LG Database report to ensure all your municipalities have submitted successfully by 31 October. Assist to address issues and rejections.
Engage your municipalities to ensure submission of IDP by 30 November Assist to enable submission as required, including engagement with vendors and NT team.
Budget submission:
Confirm the status of each of your municipalities in terms of budget development and population of the segments. Provide guidance as required.
Focus on the 46 “red” municipalities (slide ) to ensure that they are able to prepare a budget and populate the segments. Also engage their service providers to ensure that the functionality is supporting the municipality.
Upskill yourself by using the data review tools (slice and dice), reading the position papers, reviewing the changes to the chart, reviewing data submissions and meeting with municipalities and vendors.
Start early with reviewing the budget submissions and use the tools that have been developed.
Interrogate municipalities and vendors - there is no such thing as a stupid question!!
Ask the municipal steering committee and the project team to explain how the system works. (Past and future)
Ask the municipal steering committee and the project team to explain how integration has been achieved, and where manual journals and reconciliation are still required? (Indication of possible non-compliance)
Ask the municipal steering committee and the project team to explain what has changed, and what risks they foresee and how will these be managed.
Ask the municipal steering committee and the project team how employees have been prepared?

10. QUESTIONS?

11. Annexures

12. Assessment of progress by municipalities – what questions should be asked
The focus now needs to change to practical assessment relating to the following in order to ensure that municipalities will achieve mSCOA readiness on 01 July 2017:
Confirmation of Governance structures
Maintain Audit File / Project Documentation
Data purification
Budget alignment to mSCOA segments
Trial balance alignment to mSCOA segments
Repairs and maintenance unpacked to the Project Segment
Capital Projects unpacked to the Project Segment?
ICT Status
National Treasury

13. Governance Steering Committee: Implementation/Technical Committee:
Date first meeting yyyy-mm-dd
Date last meeting yyyy-mm-dd
Number of meetings held xx
Number of members xx
Terms of reference completed for all members Yes/No
Implementation/Technical Committee:
Project manager appointed Yes/No ii
National Treasury

14. Project Documentation and Audit File
Is the municipality’s project documentation and audit file in place?
(electronic copies to be provided at training workshop session)
Project Plan Yes/No
Risk Register Yes/No
Council Agenda and minutes reflecting:
- mSCOA project approval Yes/No
- implementation plan Yes/No
- committees terms of reference Yes/No
- updated KPI’s Yes/No
- progress reports Yes/No
Minutes of committee meetings in place Yes/No ii
National Treasury

15. mSCOA – Data Purification
Has data purification of the information directly impacting on mSCOA been completed?
Organogram
Tasks matched to GFS functions – aligned to function segment Yes/No
Core and non-core functions identified – for function segment Yes/No
Asset Management
Asset register complete and accurate Yes/No
Asset register reconciled to financial position Yes/No
Valuation Role
Valuation role reconciled to property rates control Yes/No
Correct zoning applied for allocation of property rates Yes/No
Suspense Accounts
Have suspense accounts been cleared and allocated Yes/No - ii
National Treasury

16. Trial Balance/Budget Alignment
Has the municipality unpacked their trial balance and budget and aligned it to the mSCOA segments?
Has every line item been allocated to:
Project segment Yes/No
Item segment
- item expenditure Yes/No
- item revenue Yes/No
- item assets and liabilities Yes/No
- item gains and losses Yes/No
Function segment Yes/No
Fund segment Yes/No
Costing segment Yes/No
Regional segment Yes/No ii
National Treasury

17. Trial Balance/Budget Alignment
Has the municipality unpacked its "Maintenance & Repairs" and all its "new capital projects" utilising the Project Segment?
All “Repairs and Maintenance" items were unpacked
to the Project Segment? Yes/No
All "Capital Projects" were unpacked to the
Project Segment? Yes/No ii
National Treasury

18. ICT Status
Have you assessed the IT infrastructure in the municipality currently and what you will need to change /upgrade/ procure in order to meet the capacity requirements of the mSCOA enabled system?
Has an IT Infrastructure assessment been done in
the municipality? Yes/No
Has the municipality identified which category of municipality
they fit in to as per the transversal contract (RT25 issued
on 4 March 2016, refer MFMA Circular 80). Yes/No
Has the municipality identified the necessary modules
required to ensure mSCOA compliance Yes/No
Has the municipality considered whether to upgrade their
current system or procure a new system Yes/No ii
National Treasury

19. ICT Status
Has the municipality reviewed their current system functionality
taking in to consideration the minimum business process abilities
in Annexure B of MFMA Circular 80? Yes/No
Has the municipality identified which category of municipality
they fit in to as per the transversal contract (RT25 issued
on 4 March 2016, refer MFMA Circular 80). Yes/No
Has the municipality engaged with 3rd party vendors to ensure
seamless integration of all systems and modules used
at the municipality Yes/No ii
National Treasury

20. THANK YOU