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CIGFARO Conference 2017: mSCOA Project Progress
Presented by National Treasury Local Government Budget Analysis: 10 October 2017
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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 A new mSCOA project team was appointed through an open tender process (GTAC003/2017) to ensure continued technical support to this reform, one of the key local government game changers The current team is also addressing deliverables which remained outstanding from the previous phase of the project, including institutionalisation of the mSCOA chart maintenance, and assisting municipalities to transact in a mSCOA environment
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Municipal transaction verification:
Verified all 257 municipalities’ ability to transact across nine functional areas, as required by mSCOA Regulation No municipality was found to be 100% compliant, 203 are partially transacting and reporting on mSCOA, and 54 are not utilising the mSCOA chart version 6.1 at all All vendors were called to National Treasury for a meeting to discuss their progress and plans going forward, as there is not one single vendor which can provide a 100% mSCOA enabling solution yet Two vendors are responsible for 39 of the 54 vulnerable municipalities (not transacting yet) – will address at national level The mSCOA team will be providing targeted support to all of the identified vulnerable municipalities during the next six weeks, to ensure that all are on their way to achieve compliance
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mSCOA chart: mSCOA GRAP, MFMA PSD Position Papers
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mSCOA chart maintenance process:
1. FAQ queries: Research and develop proposed solutions (FAQ sub-committee) Refer to Technical working group for consideration 2. Technical working group: Review proposed solutions and impact on the mSCOA chart, alignment with SCOA, GRAP, MFMA, reporting requirements Communicate with stakeholder groups Recommendation to the Technical Committee for approval 3. Technical Committee: Review proposed solutions and impact on the mSCOA chart Make a decision regarding the proposal Release the updated version of the chart
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Proposed changes mSCOA Chart version 6.2:
Opening and closing balances Information submitted by municipalities – regions, management structures, bank accounts, investments and liabilities, grants and subsidies (25 October) Capitalisation of cost - provision made for employee related cost (item exp.) require line items for PPE and inventory 4. Add remuneration of Section 79 chair under Expenditure: Remuneration of Councillors, as this needs to be reported separately Expand the explanations of core and non-core functions in the chart Correct the mismatch between item segment gains and losses on disposal of non-current and current assets
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