Transcript Roadshows - February and March 2008

“Toning” of the SCOA
Provincial and National Roadshows
February & March 2008
Presented by: SCOA Committee
National Treasury
Aim of the project
• To improve the ability to extract meaningful
data for monitoring Government expenditure
• How?
– Adjustments to BAS to modify specific areas
in the Standard Chart of Accounts (SCOA)
SCOA review focus areas
1.
Improved reporting on infrastructure expenditure
2.
Alignment of programme structures between
budget documentation and BAS
3.
Recording of the economic classification in an
appropriate segment in the chart
4.
Classification and categorisation of Goods &
Services item structure
5.
Improvement of the functional classification
6.
Monitoring Science and Technology Activities
Infrastructure spending
• Substantial increase in infrastructure budgets
• Reporting on Infrastructure spending difficult
– Must be in a position to extract IRM data from BAS
– SCOA Project segment data is not standardised
• Agreed proposal
– Standardise structure in the BAS project segment
– New segment to be implemented on 1 April 2008
– Provincial treasuries’ to assist during
implementation
Alignment of programme structures
• Budget programme structures misaligned to
the structures in the financial system
• Duplication of programmes on the system
• Programme structures from previous financial
years active - can be posted against
• Unable to use functionality in IYM model to
upload actual spending data directly
BAS
Budget
Pr1: Administration(5/6)
Administration
Pr1:Administration (1)(7/8)
Agriculture
Pr1:Management(3/4)
Conservation
Pr2: Professional Services(5/6)
Environment
Pr2:Agriculture (2) (7/8)
Pr2:Agriculture(3/4)
Pr3: Agriculture(5/6)
Pr3:Conservation (3)(7/8)
Pr3:Veterinary Services(3/4)
Pr4: Enviroment (4)(7/8)
Pr4: Veterinary Service(5/6)
Pr4:Natural Resourc Mngm(3/4)
Pr5: Natural Resource Mngm(5/6)
Pr5:Conservation(3/4)
Pr6: Conservation(5/6)
Pr6:Enviro Plan&Imp Ass(3/4)
Pr7: Enviro Plan&Impac Asses(5)
Pr7:Waste Mngm&Pop Abat(3/4)
Pr8: Waste&Pollution Abatm(5/6)
Pr10:Legal Services(3/4)
Pr11:Enforcem&Compliance(3/4)
Pr12:Mngm Info Systems(3/4)
Pr13:Commun & Awareness(3/4)
Pr14:Hr Management(3/4)
Pr15:Hr Development(3/4)
Pr16:Facilities Managemt(3/4)
Pr17:Dir Fin Management(3/4)
27 Active Programmes on BAS
4 Programmes in Budget
Numerous duplications
Alignment of programme structures
• From 1 April 2008 NT will lock the highest levels
of objective in BAS
• Complete alignment with programme structures
in the budget will be ensured
Process followed:
• Dec 2007 – Programme structures to BAS team to create database
• Jan 2008 – Structures loaded on BAS
• Feb 2008 – Departments create substructures & PERSAL codes
• End Feb 2008 – Structures verified with appropriation bills and
budget documentation and signed-off by provincial treasuries
Good & Services item classification
• Detailed analysis of existing Goods & Services
items indicates a review is required
• 80% of spending occurs on 10 high level items
• Inventory & Consultants largest spending
items, with limited sub level details available
• Meaningful data for policy analysis requires
detail
• Streamlining of SCOA item list commenced via
CFO forums
Recording economic classification
• Misconception that SCOA Item list correspond to
Economic Reporting Format (ERF)
• ERF recorded across different segments of BAS
• Classification conflicts exist within the structure,
i.e. Objective vs. Item
• Item list often only source of data for completing
reports and budget submissions
• Economic classification creates duplication in
objective
Functional classification
• Govt expenditure measured according to
internationally recognised functional categories
• Functional classification a subset of BAS
objective structure
• To improve quality of classification, redundant
activities must be cleared from objective
segment
• Functions will be assigned to the lowest level of
each objective at the beginning of each financial
year by National Treasury
Monitoring Science & Technology
• Cabinet approved S&T framework requires
annual expenditure plan
• NT to provide platform for data capture within
budget process and financial system
• Most S&T spending via projects, therefore the
intention to identify these projects during budget
• Monitor project implementation through
indicators in BAS
Benefits
• Improved data flow and data quality
– Annual Financial Statements, IYM, Infrastructure Reporting, etc.
• Clean up of the system
– Redundant items and objectives, Suspense accounts, BAS User
review, Suppliers database
• Improved economic classification
• Improved systems performance
• Recording of own account transactions
Impact
• Current database not affected
– No impact on 2007/08 financials
• BAS re-implementation required
• Two new segments added
• Six of seven segments standardised
• Departments must provide lower level
details
Change management
• Training
– Road shows and training in Jan - March, including Auditors
– Review of SCOA definitions and training manuals and process
• Updated classification guides and circulars
• Call centre and classification committee to
provide rules and classification support
• Assistance with systems changes
Assistance with systems changes
• BAS, LOGIS, PERSAL systems interface
updated centrally
• Debt accounts converted
– including debt type and regional parameters
• Entities converted, suppliers and PERSAL
• Suspense and control accounts converted
• All systems parameters to be converted
– Only departmental parameters to be captured by
departments, in accordance with a detailed BAS
implementation checklist (website:BAS.pwv.gov.za)
BAS Systems Controller
• Create sub structures in Objective and the Responsibility
structure
• Link personnel to BAS
– New function 6/10/23 (BAS Notice 265) will assist in making this
an easy process
• Create user ID’s
• Create sub structures for Project, Asset and Region
• Provide for interface with sub systems not controlled by
National Treasury
• Activate relevant accounts
• Process can start once database is distributed
– First week in February
– Monitored by Systems Team
Summary
• Implementation date – 1 April 2008
• BAS re-implementation required
– process can start early February
• Numerous conversions done by systems team
• Impact mainly on departmental BAS Systems Controller
• Systems road shows January
• Further 1 day workshops in March, 3 day SCOA training
from May
• Task Team looking at comments and proposals
• Project updates will be communicated via the TCF, CFO
Forums and the BAS User Forum
Questions
Segment Discussion
Highlights of the changes to
the different segments
Systems Structure (BAS)
Fund
Segment
Regional
Segment
Objective
Segment
TRANSACTION
Project
Segment
Responsibility
Segment
Asset
Category
Item
Segment
Fund Segment
• What source of funding will be used for the
transaction?
• Main sources:
– Voted funds
– Earmarked allocations
– Conditional Grants
• Inter Departmental Services
– New balance sheet accounts to keep track of
inter departmental service and advances
Objective Segment
• Against which programme / activity should the
transaction be recorded?
• Programme budget of department
• Centrally locked Objective Structure aligned to
budget document
– Departments to capture lower levels
– Departments to link personnel
– Need to verify sub-programme details
• Trading Entities
– Departments to create sub structures
Responsibility Segment
• Identify cost centres
• To which cost centre should the transaction
be allocated?
• Link to organisational structure
• Not standardised – Treasuries can
structure at own discretion
Item Segment
• What is the item that is being bought?
• Review based on history data
• Changes
– More detail on Consultants and Inventory
– Remove duplication of asset categories and
minor assets
– Removed all unused items
– Restructured the levels to provide better
summaries
Asset Category Segment
• Does the transaction relate to an asset and
if so, which category of asset?
• Provide for details of assets
• Eliminates duplication in Item Segment
• Allows for capturing of own account
transactions
• Alignment with the Asset Management
Guide
Project Segment
• Does the transaction relate to a specific
project, and if so what type of project?
• Economic classification
• Project vs. Stand alone
• Projects – Infrastructure, Infrastructure
transfers, non-infrastructure
• Identify maintenance, upgrade,
refurbishment and new
Regional Segment
• In which region does the service get
delivered?
• GIS of Government Spending
• Look at service delivery perspective
• Broken down by Municipality
• Provide for general spending not related to
a specific Municipality
• Provide for general categories at provincial
and district level
Questions