City of uMhlathuze’s Internal Audit Unit has been internally established within the previous 5 years. The current establishment is on a co-sourced relationship with the Chief Audit Executive (CAE) internally appointed who manages and oversees the functions of internal audit. The CAE is a Certified Internal Auditor (CIA) with 10 years’ experience in Local Government. She has previously worked at the office of the Auditor General of SA , eThekwini Municipality and uMhlathuze Municipality's Finance department before being promoted to the Internal Audit Unit. She is also a member of the professional body of auditors the Institute of Internal Auditors (IIA) SA where we are appraised of changes and new developments within the profession to ensure relevance through professional development. She is supported by external audit firms responsible for the performance of the duties and functions of internal audit. This, however, is a three year phase-in plan where the unit will thereafter be fully insourced. During this phase-in plan, we would effectively facilitate transfer of skills to our internal resources. That way we are able to obtain and retain the skills on a going concern basis.
IAA Mission statement
To provide independent objective assurance and consulting insights on the effectiveness, economy and efficiency of uMhlathuze Municipality’s governance, risk and controls in order to create and drive innovation, responsiveness and sustainability of the service delivery value chain.
Objectives of the Internal Audit Unit
The internal audit activity (IAA) helps the municipality accomplish its objectives by bringing a systematic, disciplined approach to evaluating and improving the effectiveness of risk management, control, and governance processes. In fulfilling its mandate as per the above, the IAA conducts assessments and evaluations of the adequacy and effectiveness of governance, risk management and internal control processes for the municipality. IAA also operates in terms of the Institute of Internal Auditors' (IIA) mandatory frameworks including the Definition of Internal Auditing, the Code of Ethics, and the International Standards for the Professional Practice of Internal Auditing (Standards) and any other relevant laws and regulations applicable to uMhlathuze Municipality. Strategic and Annual operational plans are aligned to organizational strategic plans and are risk based to ensure applicability and relevance in achieving organizational objectives. Proper planning and communication also ensures that our performance is at optimum.
The Internal Audit Activity (IAA) of the municipality is established and regulated by section 165 of the Municipal Finance Management Act No. 56 of 2003 (as amended) (MFMA) read together with the MFMA Circular no. 65 of 2012 issued by the National Treasury and by the Municipal Systems Act, No. 32 of 2000 (MSA).
The subsection’s mission is to provide independent objective assurance and consulting insights on the effectiveness, economy and efficiency of uMhlathuze Municipality’s governance, risk and controls in order to create and drive innovation, responsiveness and sustainability of the service delivery value chain.
The critical success factors and deliverables for an effective Internal Audit unit are:
- Three year rolling strategic and operational plans that are
- Aligned to strategic objectives of the organisation.
- Covers the strategic risk areas facing the organisation
- Is risk based – addresses the key risks areas/concerns of management.
- Is prepared in consultation with management, the audit committee and external auditors.
- Matches assurance needs with available resources.
- Trusted advisor to management
- Promoting the sustenance of an effective internal audit function
- Promoting accountability
- Performing consulting activities in accordance to client needs
- Assisting management with the enhancement of the overall governance, risk and internal control environments;
- Maintenance of a Quality Assurance and Improvement Programme:
- That covers all aspects of the internal audit activity.
- The programme includes an evaluation of the IAA’s conformance with the definition of Internal Auditing and the Standards and an evaluation of whether the internal auditors apply the Code of Ethics.
- The programme also assesses the efficiency and effectiveness of the internal audit activity and identifies opportunities for improvement.
The subsection’s focused objective is to help the municipality accomplish its objectives by bringing a systematic, disciplined approach to evaluating and improving the effectiveness of risk management, control, and governance processes.