mSCOA Reference Group Meeting
Alignment of Annual Financial Statements to mSCOA Chart
30 October 2017 Presented by: F Khan
Problem Statement
Municipalities face a number of challenges in preparing their annual financial statements which impacts the timely preparation and submission of high quality
set of annual financial statements to stakeholders. This late preparation of the financial statements impacts the effectiveness of the governance review
processes established by the MFMA and the municipalities. The late
preparation results from year-end process not being defined and/or adhered to;
municipalities being unable to reconcile the opening balances as adjustments were recorded outside the system and the financial system was not updated and/or vice versa; some municipalities do not have the “capacity” to prepare financial statements and make extensive use of consultants with no transfer of
skills. In addition, the reported information does not/may meet the requirements of the relevant stakeholders.
Enabling Regulation mSCOA
Municipal Regulations on a Standard Chart of Accounts, 2014
“Object of these Regulations
2. 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 by prescribing a standard chart of accounts for municipalities and municipal entities which-
(a) are aligned to the budget formats and accounting standards prescribed for municipalities and municipal entities and with the standard charts of accounts for national and provincial government; and
(b) enable uniform information sets recorded in terms of national norms and
standards across the whole of government for the purposes of national policy coordination and reporting, benchmarking and performance measurement in the
Framework of reference
Reference Framework
GRAP Directive 5
Financial Statements mSCOA
ASB Website
• Directive 5
• Accounting Standards
• St. of Financial
Performance,
• St. of Financial Position,
• Cash Flow St.,
• St. of
Changes in Net Assets
• Disclosure notes
• IS Assets,
• IS Liabilities,
• IS Revenue,
• IS
Expenditure,
• IS Gains and Loss
Engagements with stakeholders
– Stakeholders
• Vendors
• Municipalities
• ASB
• Regulatory authorities – How?
• Workshops
• Reference groups
– Communicate unique situations that we may not
Timeframes
Nov – Prepare AFS
Stakeholder engagement
Update and release for comments
Final Update
Release
Feb 2018 Jan 2018
Mar 2018
Apr 2018
