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It is the duty of an entity’s management to prepare their financial statements in terms of the applicable financial reporting framework, which is based on the management’s consideration and application of this framework on the balances and transactions of the entity. This addresses assertions as to the completeness, accuracy and validity on various matters. These include the entity’s state of affairs, performance against budget, management of revenue, expenditure, assets and liabilitiesfinancial results and financial position and legal disclosures.

During the audit, the Auditor-General of South Africa (AGSA) will test the completeness, accuracy, and validity of transactions, balances and disclosures made by management.
General audit challenges experienced by auditees pertaining to GRAP AFS may include:

 Keeping up to date with complex and highly technical accounting and auditing standards;

 Extremely rigid reporting timelines for AFS preparation & audit completion.

 Restricted response time available.

 Different opinions between preparers and the AGSA on technical issues raised by the AGSA.


 Audit Support

SCB CONSULTING can assist entities with the following matters pertaining to the audit query and finding processes, with further details set out below:

1. Audit query & technical support Prior to the expressing its audit opinion, the AGSA will communicate details on the audit findings on the GRAP AFS submitted by management.
Management needs to address and respond to these matters through means of an audit query management process.
2. Centralised & online audit query system During the audit, management needs to have the necessary systems in place to adequately attend to, distribute and address the audit queries raised by the AGSA.  Unattended or insufficiently addressed audit queries may significantly impact on the AGSA’s audit opinion.
3. Audit Improvement plans For the audit matters identified which cannot be corrected prior to the expression of the audit opinion, management should implement and management audit improvement plans to address these matters identified though a revision of the entities policies, processes and procedures.
4. Capacity Building support We can assist with capacity building and development through hands-on support or dedicated training interventions.
  1. Audit query management process

This provides assistance during the audit process on matters pertaining to the timing, quality and validity of explanations for audit findings. This includes:

 Exercising control over issued audit findings and responses provided

 Evaluation of audit findings and management responses through expert technical knowledge

 Assistance with timely compilation of quality responses to audit findings

 Review of client prepared responses to ensure that audit findings are appropriately addressed.

This includes specialist technical enquiry support on key audit findings on GRAP and management’s consideration and application thereof, which have a critical impact on the audit opinion of the entity.

  1. Audit query management system

SCB Assist IT tool is a cost-effective and secure web-based accessible platform (with mobile / remote access) to manage the audit query process. It provides for:

 Clearly defined responsibilities and accountability for audit queries (collate, allocate, distribute, and answer audit queries, audit logs)

Centralised database with up to date information on audit queries  (allows the entity to efficiently track progress <open, pending,=”” complete=””>, answer, store supporting information, and address the audit queries received, AGSA and management responses)</open,>

 Management tools (dashboard, notifications, reminders, standard and exception reporting)

  1. Post-audit improvement support: Audit action plans

Following the review and audit by the AGSA, an audit report is issued to state whether the auditees AFS were fairly presented or not.  This is also supported by a detailed management letter from the AGSA which sets out all the findings in details (finding, root cause, impact and recommendations).  SCB can assist entities with:

 Compilation Compilation of an action plan based on audit findings including detailed corrective measures prior to the next audit.
Execution Assistance in executing the action plan ranging from housekeeping issues to highly technical issues.
Monitoring Monitoring progress of action plans executed by staff members.


  1. Capacity building support

We will also be able to assist with capacity building and development pertaining to the matters underlying to the audit queries, through our hands-on support or our structured training interventions, such as:

GRAP AFS level

 AFS Compilation Plan training

 GRAP training (Implementation challenges; GRAP Disclosures; GRAP updates)

General ledger support

 Performing of all relevant reconciliations (bank-, suspense-, debtors- and creditors accounts)

 Compilation of registers (assets-, lease-; IFW&U registers;

 Clearing of suspense accounts (substantiate transactions through supporting documentation).

Audit file support

 Audit support file compilation training

 Validation of debtors and creditors

 Physical verification of movable and immovable assets

 Performance of interim and year-end inventory counts