DEPARTMENT OF PUBLIC WORKS

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DEPARTMENT OF PUBLIC WORKS

• PRESENTATION TO THE PORTFOLIO COMMITTEE
• RISK MANAGEMENT AND FRAUD PREVENTION STRATEGY
• 24 August 2005

PRESENTED BY Ms. Z. Mxunyelwa, ACFE, CIA Chief
Audit Executive - DPW
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INTRODUCTION
RISK MANAGEMENT AND FRAUD PREVENTION STRATEGY

• Development of a comprehensive plans for 2004 to
  2007
• Adoption 31 July 2004
• Management Committees
• Audit Committee
• Office of the Auditor General Acceptance
• Annual revision of critical and emerging risks
  Until 2007
• Revised comprehensive plan April 2007

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RISK MANAGEMENT AND FRAUD PREVENTION STRATEGY
FRAUD PREVENTION STRATEGY

• FRAUD PREVENTION PLANS 2004 2007
• Prevention Plan/Capacity
• Fraud and Corruption Risks
• Code of Conduct
• Fraud Policy and Response Plan
• Implementation Plan

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RISK MANAGEMENT PLAN
RISK MANAGEMENT AND FRAUD PREVENTION STRATEGY

• Risk categories
• Strategic
• Financial
• Technological
• Operational
• Fraud and corruption

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RISK MANAGEMENT PLAN
1. CHALLENGES

• STRATEGIC CHALLENGES
• Mandate of the Department
• Co-ordination between DPW and other government
  structures
• Corporate Governance
• Governments Role
• Communication Strategy

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RISK MANAGEMENT PLAN

• FINANCIAL CHALLENGES
• Internal Controls
• Financial Management
• Financial Resources

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RISK MANAGEMENT PLAN

• TECHNOLOGICAL CHALLENGES
• IT Governance Policies
• Business Continuity
• Loss of Data
• Data Integrity
• Access Controls

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RISK MANAGEMENT PLAN

• OPERATIONAL CHALLENGES
• Service Delivery
• Asset Management
• BEE initiatives and implementation
• Legislation Implementation
• Expanded Public Works Program
• HR Strategies
• Lawsuits against DPW

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RISK MANAGEMENT PLAN

• FRAUD AND CORRUPTION CHALLENGES
• Organizational Culture
• Tender and Procurement, including fronting
• Payroll
• Theft
• Abuse of State Assets

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RISK MANAGEMENT PLAN
2. CAUSES/SOURCE

• DPW White Paper 1997
• Public Finance Management Act, 1999
• State Properties Maintenance Backlog
• Cooperation by Client Departments
• Nature of Operations
• Inadequate Financial Resources
• Government Information Technology Systems
• Public Sector Environment

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RISK MANAGEMENT PLAN
3. CONTROL STRATEGIES

• Implementation of the 1997 White Paper
  Initiatives
• Improved Service Delivery
• Devolution of budgets to client department
• Effective communication of the Leadership Way
• Personnel Development and Training
• Revised Organizational Structure
• Decentralization of Functions
• Capacity Building in Regions
• Service Delivery Improvement
• Development of New Business Processes

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RISK MANAGEMENT PLAN

• CONTROL STRATEGIES (cont.)
• Service Level Agreements with Client Departments
• Consultation with stakeholders on Policy
  Development
• Information improvement on the asset registers
• Proactive disposal programs
• Development of IT Policies and DRP
• Improved Financial Management Controls
• Coordination improved communications with AG
  Office
• Capacity building of the Internal Audit Activity
• Fraud Awareness Workshops and Training
• Measures to address fronting BEE verification
  and on-site monitoring

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RISK MANAGEMENT PLAN
4. TIME FRAMES
RISKS TIME FRAMES
Critical/High Risks Annual Emerging Critical Risks July 2004 to March 2006
Medium Risks Annual Emerging Critical Risks April 2005 to March 2006
Low Risk Annual Emerging Critical Risks April 2006 to March 2007