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Parliament Portfolio Committee on Energy

Parliament Portfolio Committee on Energy. Presentation by the Audit and Risk Committee. BACKGROUND. The Audit and Risk Management Committee (Committee) operates in terms of its charter approved by the board. It is a board committee and consists five non-executive directors.

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Parliament Portfolio Committee on Energy

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  1. Parliament Portfolio Committee on Energy Presentation by the Audit and Risk Committee

  2. BACKGROUND • The Audit and Risk Management Committee (Committee) operates in terms of its charter approved by the board. • It is a board committee and consists five non-executive directors. • The Chairperson of the Committee, is a Chartered Accountant and Certified Internal Auditor and he is an independent non-executive director. • The Committee members consist of members of the Board and one independent member. • The committee was constituted to include experts in IT Assurance, Risk Management, Finance, Audit and Nuclear Science.

  3. BACKGROUND • The committee undertakes its work in accordance with the annual plan derived from its charter. • The CEO, CFO, Internal Audit & Risk Manager and Auditor General of South Africa (AGSA) have a standing invitation to the Committee meetings. • The committee reports to the board atleastquarterly. • The Committee meets least quarterly.

  4. Audit Committee Activities Map

  5. RESPONSIBILITIES • The Committee meets to address the roles and responsibilities as detailed in the Committee Terms of Reference (TOR), including: • financial and sustainability reporting; • internal financial controls; • external audit process; • internal audit process; • risk management; • information technology ; and • Performance management. • The Committee recommends to the Board for approval matters that were considered in terms of its TOR.

  6. NNR INTERNAL CONTROL…… Legislation Policies Charters Procedures Governance Arrangements Organisational Objectives Enterprise wide Risk Assessment Systems People Processes Performance Financial Operational Compliance Environmental Assurance Management Internal audit External Audit

  7. AUDIT COMMITTEE ANNUAL PLAN • The committee annually prepares its annual plan to ensure coordination, extensive assurance and risk mitigation.

  8. AUDIT COMMITTEE ANNUAL PLAN (CONTINUES)

  9. MAJOR AUDIT COMMITTEE ACTIVITIES (CONTROL MEASURES) • Reviewed and recommended for approval IT, performance, risk management, finance and SCM policies. • Reviewed and approved for approval the performance scorecard and the related budget. • Review and approved the risk management plan and the three year strategy and internal audit annual plan. • Reviewed and approved the AGSA audit plan and proposed fees. • Reviewed quarterly the status of implementation of action plans to address identified external audit findings is presented and monitored quarterly.

  10. MAJOR AUDIT COMMITTEE ACTIVITIES (CONTROL MEASURES) • Reviewed the compliance program of the regulator and the IT Strategy and recommended the for approval. • Reviewed the quarterly financial, performance and compliance reports presented by management. • Reviewed the assignments reports and quarterly reports from internal audit in the implementation of the plan, and the implementation of the risk management plan. • Reviewed the funding plan of the NNR in accordance with its operation requirements for the next three years.

  11. YEAR-END ACTIVITIES • Initial draft of the financial statements for 2011/2012 had material errors. • The errors were subsequently corrected. • The AFS were submitted in accordance with the legislated time. • The AGSA revealed issues in assets, potential irregular expenditure, leases, IT and performance information. • The lease issue was taken for consultation with the AGSA Technical Department and the National Treasury, ultimately

  12. ACTIVITIES MATURITY Focus will be placed on enhancing the activities in Information Technology and Compliance in this period. The Performance Management unit has been greatly improved.

  13. COMBINED ASSURANCE VIEW Organisational Strategy Enterprise wide Risk Management Assurance Compliance Audit Audit of PI External Audit Internal Audit Sustainability Financial Social Environment

  14. CHALLENGES • The absence of a CFO for the major part of he year, reducing reports review capability. • Material errors detected before submission of AFS to the AGSA. • Changes in the Regulations during the year, resulting in differences in interpretation. • Moving to the new building, resulting in asset issues. • Limited funding resulting in limited ability to plan and forecast appropriately.

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