HSRC Integrated Annual Report 2018/2019

are adequate and effective to assist the organisation to achieve its goals and objectives. In its oversight role, the Committee determined that risk and compliance management processes for the year under reviewwere inadequate. Management’s mitigation proposals to address the deficiencies in the risk and compliance management processes have been noted and will bemonitored at each Committee meeting. The combined assurance model has not been fully implemented and will be addressed as part of the risk management process enhancement. However, in considering the various Internal Audit reports, the management report from the Auditor- General of South Africa, the internal control opinion expressed by the Internal Auditor and discussions with both the Internal and External Auditors, the Committee is satisfied that the internal controls of the HSRC remained effective during the year under review. Internal Financial Controls The Committee is satisfied that the internal financial controls of the HSRC were effective during the year under review and provided the basis for preparation of reliable Financial Statements. Evaluation of the Finance Function A review of the finance function was undertaken by the Committee to evaluate its effectiveness. The Committee is satisfied that the finance function has fulfilled its objectives for the year under review. Evaluation of Financial Statements The Committee has: • Reviewed the audited Financial Statements to be included in the Integrated Annual Report; • Reviewed the Auditor-General of South Africa’s management report and management’s response thereto; • Reviewed the performance information; • Reviewed changes in accounting policies and practices; • Reviewed the entity’s compliance with legal and regulatory provisions; and • Noted that there were no material adjustments resulting from the audit. In-Year Management and Quarterly Reporting The HSRC has reported quarterly to the National Treasury and DST (the Executive Authority) as is required by the PFMA. Internal Audit The Committee reviewed and approved the annual internal audit plan and internal audit charter during the year under review. The Internal Audit function of the HSRC is outsourced. The Committee met separately with the director of the Internal Audit service provider. In addition to providing assurance on governance, risk management and control processes during the year under review, the Internal Audit function added value to the organisation by presenting timeous and relevant reports to management and the Committee. The Committee is satisfied with the effectiveness and independence of the Internal Audit function. There are no outstanding or unresolved matters with Internal Audit. Auditor’s Report The Audit and Risk Committee concurs and accepts the conclusions of the Auditor-General on the Annual Financial Statements and is of the opinion that the audited Annual Financial Statements be accepted and read together with the report of the Auditor-General. Ms Precious Sibiya Chairperson: HSRC Audit and Risk Committee HSRC INTEGRATED ANNUAL REPORT 2018/19 / 79