1. Western Cape Provincial mSCOA Project Project Sponsor: Aziz Hardien
CIGFARO WESTERN CAPE BRANCH Annual Seminar 5 to 6 June 2017 – Goudini Spa mSCOA Update
Western Cape Provincial mSCOA Project
Project Sponsor: Aziz Hardien
Caledon|
Presented by: Donovan Stuurman|
19 September 2018

2. Agenda
mSCOA Update
mSCOA Compliant Budget Submissions
mSCOA Deliverables Update
Project Issues
Lessons Learnt

3. Count Down
mSCOA
Go-Live 18
Days

4. Agenda
mSCOA Update

5. Overall Project Status

6. Overall Project Status
April 2016
August 2016
61 – 100% %
0 – 40%
0 – 20%
41 – 100%
21 – 40%
FAIL
Project Status –
PT Assessment
November 2016
April 2017
0 – 50%
66 – 100% %
0 – 65%
81 – 100% %

7. Municipal mSCOA Self-Assessment Status

8. Municipal mSCOA Self-Assessment Status

9. mSCOA UPDATE Fujitsu clients move to Vesta
Outstanding deliverables from municipalities
ICT Due Diligence responses in progress
Analysis of Self-Assessment4 submissions
Budget Data String Submissions and Segment Analyses

10. Agenda
mSCOA Compliance & Draft Budget Submissions

11. mSCOA Compliance – Addendum to MFMA Circular 80
Initiatives to ensure compliance:
Registration of MM and/or delegate on NT LG Database – 31-Oct-16
Submission of Sample Data String – 31-Oct-16
Submission of Sample IDP with split between 3 segments – 30-Nov-16
Municipalities must have a systems-integrated IDP (integrated development plan) Module
System budgeting functionality that includes:
Organogram Budgeting; Billing historical trends and new developments; Asset maintenance plans; Building rentals; Fleet costs; Loans, bonds and repayments; Grants and subsidies; Costing allocations; and Long term forecasting and tariff modelling tools
Tabling of the an mSCOA Compliant Budget by 31-Mar-17 that incorporates all 7 Segments
National Treasury will test through its data extraction (across the 6 regulated mSCOA segments) from the information submitted by municipalities by the 10th working day of August 2017
Transact across the 7 segments of mSCOA with subsystems seamlessly integrating to the core financial system effective 01-Jul-17
FAILED
FAILED

12. Budget Submissions & Verifications Compliance Process
Stage
Requirement
Action
Stage 1
Due -
03-Apr-17
Stage Submission of the mSCOA v6.1 data strings to the LG Database. This step verifies that the data submitted is in the correct format
This is validated by the LG Database and is complete
Stage Submission of the electronic budget documents and corresponding electronic returns
This was submitted to the PT and was validated
Stage 2
Validation of the mSCOA Segment allocations
The information submitted to the LG Database is going through another validation process to check if the allocation across the segments were done correctly
The PT must review this report and send to municipalities to correct
Stage 3
Compare the A-Schedules submitted by municipalities against the A-Schedules produced from the data strings submitted by municipalities
The PT submits the A-Schedules to the municipality to validate against the manual schedules submitted to ensure that the electronic submission agrees with the manual submission
Stage 4
Analyse the budgets submitted
Once there is consensus that the data strings submitted and A-Schedules received from municipalities are aligned, then the analyses of the budgets can be finalised and municipalities will be considered as being fully compliant

13. Draft Budget Data Strings Submissions Status - TABB17 13
By 03-Apr-17
After 03-Apr-17 16 14
Complete
Outstanding
Stage 1: Format Validation
Stage 2: Segment Analysis
NT Comments: It is required of every municipality to submit a data string that conforms with the mSCOA regulation. The data submitted by some municipalities contains errors that need to be corrected and the updated data string must be resubmitted to the LG portal. The current TABB submission (Tabled Budget) will not be accepted if the errors are not corrected. The process of resubmission of the TABB should be repeated until all errors are corrected.
We expect the municipalities to fix these posting errors BEFORE submitting their adopted budget.

14. Final Budget Data Strings Submissions Status - ORGB
Stage 1: Format Validation
Stage 2: Segment Analysis 4
Within 10 Days of approval
Late Submission 4 26
Complete
Outstanding

15. Agenda
mSCOA Deliverables

16. Current and Overdue mSCOA Deliverables
Description
Due Date
Complete
Status
1. Conduct an ICT Due Diligence of the existing package of systems used by the municipality to make a final decision on whether to remain with its existing package of systems or to upgrade systems or to change systems
02-Sep-17 22
In Progress
2. Stage 1: Submission of Draft Budget Data Strings
03-Apr-17 30
3. Stage 2: Draft Budget Segment Validation
05-May-17 16
4. Stage 3: Submission of the A-Schedules to the municipality
31-May-17 13
5. mSCOA enabling systems installed and ready for user acceptance testing
30-Apr-17 6
6. Unpack “repairs and maintenance” and “all new capital projects” into the mSCOA Project Segment 20
7. Data purification activities
8. Convert current Chart and Trial Balance to mSCOA Chart and Trial Balance 21
9. Ensure all work stream activities that affects the go-live date of 01-Jul-17 are completed 5
10. User Acceptance Testing 4
11. Go Live – Ready by 15-Jun-17
01-Jul-17

17. Agenda
mSCOA Project Issues

18. Project Issues – National Treasury
Outstanding Position Papers
Outstanding revised Project Summary Documents (PSD’s)
mSCOA Circular 7 overdue
IDP Data Strings cannot currently be validated by the LG Database as this functionality is also still in development
The functionality to produce the A-Schedules from the LG Database, based on the Data Strings submitted, is still in development (All complete, but A7 still in development)
Delays in responses to queries logged on the FAQ Database
NT communication on project issues are lacking
NT’s final position on mSCOA compliance

19. Project Issues - Vendors
Vendors have not delivered on the mSCOA requirements
Vendors are still in development phase and still trying to deploy functionality required for budget submission
Establish Vendor user forum to deal with issues
Vendor Engagements & 24-Mar-17
Vendors have capacity constraints and are not able to keep up with demand from municipalities
Vendor internal and external communication lacking
Delays from National Treasury has resulted in delays in system development and deployment

20. Project Issues - Municipality
Political instability
Instability caused by senior management movements (PM’s, CFO’s & MM’s)
Lack of financial and human resources
To much dependence/reliance on external consultants/service providers to implement mSCOA
Reactive approach by municipalities resulting in inadequate management of their mSCOA deliverables
Non-Compliance with mSCOA requirements
Late submission of alignments
Delays from National Treasury has resulted in delays and rework required by Municipalities
Municipalities budgets are not funded (Funding source segment) resulting in delays with finalising the budgets
No funding for mSCOA implementation resulted in delays in signing MOU’s
Non-communicative (doing your own thing) and suffering in silence
Some municipalities feels abandoned by National Treasury. No clear directive taking into account the current status of mSCOA implementation in the municipality

21. Agenda
Lessons Learnt

22. Lessons Learnt
Implementing SCOA is a learning curve - errors will be emerge along the way. For example the structure may not cater for certain essential receivable control accounts (Accounts that would not be included in the debtors sub-ledger)
ICT Server & Infrastructure – Ensure Your ICT Infrastructure is adequate well in advance. Assess and, if necessary, Procure well ahead. Consult with your vendor
The size of mSCOA should not be underestimated. Users running reports will require upgrades to hardware as to be able to view/work with data.
mSCOA has presented an opportunity to review accounts, business processes, policies, stationery, etc.
Align business processes to the new mSCOA way before go-live
Ensure municipal policies are updated to incorporate mSCOA
The project should not be lead by service providers. All parties should be collectively involved
Getting the municipal service providers (including 3rd party service providers) on board at an early stage is vital

23. Lessons Learnt
If downtime occur, the Municipality must have sufficient contingency plans in place to ensure that service delivery is not affected
Sufficient testing should be done on data before implementation. Even though your system worked perfectly at another site, you should still test it with your data.
Plan and work the plan – The Project plan should be followed and clearly monitored. If deviations occur, corrective actions should be taken to ensure that the project does not derail.
Resource Allocation - Dedicate at Least 2 Fulltime resources ( Depending on your Size)
Project Documentation - Keep All Project Documentation and use good Project Management Tools
A mind shift is needed for the implementation of a mSCOA
Risk Management - Anticipate Risks, keep a risk register, manage and mitigate your risks
The importance of the implementation of the revenue sub-system on mSCOA should not be underestimated, as any issues may lead to serious cash flow problems

24. Lessons Learnt Change Management & Awareness
Ensure that the Accounting Officer and the Council is aware of their accountability for the implementation of the mSCOA Regulations and the impact non-compliance may have on service delivery
mSCOA is a business reform and not an accounting or an IT reform
Everyone (Council too) should be involved, convince them
Table mSCOA Regulations and Circulars at Council
Have regular Steercom and Project Team meetings and include Internal Audit
Get buy-in from Senior Management
Adhere to Project Timeframes and Milestones
Audit Considerations - Keep a clear tab, and reconciliations to make it easy to Agree Opening Balances, as Votes will Change, 1 to Many & Many to 1

25. Lessons Learnt Obtain sign-off for EVERYTHING
Engage with provincial mSCOA forums – If not, it may lead to a lack of common understanding
mSCOA Knowledge - EVERYONE to understand the classification framework. Be up to date with latest developments. Monitor Treasury Websites, attend courses, forums, user groups, training, etc.
Understand the 7 Segments – Don’t outsource this expertise
Analyse communication received from PT & NT to ensure there is a clear understanding of what is being communicated
Action requirements articulated in Circulars
Support from National and Provincial Treasuries are critical

26. Agenda
Conclusion

27. Municipalities at Risk
mSCOA Enabling System Components not installed on the municipality’s servers
No IDP and Budget Modules installed
TABB submissions not finalised – Including finalisation of the Segment Analysis
mSCOA Enabling System UAT not started and not completed
Convert current Chart and Trial Balance to mSCOA Chart and Trial Balance
Workstream activities not completed
Data Purification
Business Processes
Unpacking repairs & maintenance into capital projects
No change management activities
Go-Live readiness by 15-Jun-17