This document outlines the key topics to be covered in a presentation on risk management implementation in the public sector. It includes sections on the risk management perspective in South Africa and internationally, definitions of risk management, forms of strategic and operational risk, risk management context and analysis with specific past risks, critical success factors for effective risk management, objectives of risk management, and ensuring sustainability through audit and risk structures. The presentation aims to discuss challenges to implementing risk management in the public sector.

1. Risk management implementation in the public
sector, “Challenges”
Cleopas Chiyangwa
01 February 2013

2. TABLE OF CONTENTS
01 January 2013
 Risk Management Review: South African Perspective
:1
 Risk Management Review: International Perspective :2
 Definitions of Risk Management: __________________________ :3
 Forms of Risk : Strategic_________________________________:4
 Forms of Risk : Operational ___________________________:5
 Risk Management Context & Analysis(1): _________________:6
 Risk Management Context & Analysis(2) : ________________:7
 Critical Success Factors for Effective Risk Management______:8
 Effective Risk Management Objectives ___________________:9
Risk Management & Sustainability_______________________:10

3. RISK MANAGEMENT OVERVIEW IN THE SOUTH AFRICAN
PUBLIC SERVICE
01 February 2013 1

4. RISK MANAGEMENT INTERNATIONAL PERSPECTIVE
01 February 2013 2

5. WHAT IS RISK MANAGEMENT?
01 February 2013 3

6. FORMS OF RISK: STRATEGIC
01 February 2013 4

7. FORMS OF RISK: OPERATIONAL
01 February 2013 5

8. RISK MANAGEMENT CONTEXT AND ANALYSIS (1)
01 February 2013 6
Year Risk Specific Risks
2010/2011 As disclosed in note 42 to the financial statements the opening Stationery Controls
balance for moveable tangible capital assets (major assets)
has been reduced by R8 094 000 and the opening balance
for moveable tangible assets (minor) increased by R2 833 000,
through current year adjustments to prior year balances in
order to address prior year misstatements. Adequate supporting
documentation was not available to support these adjustments
2010/2011 Inability to obtain sufficient appropriate audit evidence to satisfy Stationery Controls
the existence, completeness, valuation and allocation of rights
pertaining to the moveable tangible capital assets (major assets)
operating balances of R21 936 000 and moveable assets
(minor assets) opening balance of R2 778 000, and the related
adjustment of R8 094 000 and R2 833 000 respectively
Source Annual Report 2011/2012:65

9. RISK MANAGEMENT CONTEXT AND ANALYSIS (2)
01 February 2013 7
Year Risk ( SCOPA Resolutions) Specific Risks
2007/2008 The Department incurred irregular expenditure to the amount of
R6.5 million that relates specifically to gifts and sponsorships in
violation of Section 76 (1) (I) of the PFMA read with the Treasury
Regulation21.1.1 which provides that donations or sponsorships or
gifts in excess of R100000 must be approved by the relevant
legislature
Irregular Expenditure
2007/2008 The internal controls of the Department were found to be
ineffective in that the Audit Committee and Internal Audit did not
substantially fulfil their responsibilities and the financial
statements were materially amended during the audit process and
the required information or documnets could not be provided
timely to the auditors
Internal control weakness
Source Annual Report 2010/2011:82

10. What are the critical success factors for effective
risk management for the Department ?
01 February 2013 8
Assurance
ERM Internal Audit
Fraud Risk
Management
ERM Framework IA Methodology
FRM Methodology
Combined Assurance
Methodology

11. EFFECTIVE RISK MANAGEMENT:OBJECTIVES
01 February 2013 7
6) To evaluate the effectiveness of
the entire system of risk
management and provide
recommendations for im
provement where necessary.
7) To determine whether risk
management processes are effective.
8), To establish a Risk Management
Committee.

12. RISK MANAGEMENT & SUSTAINABILITY
01 February 2013 7
(3) Audit Structures
 Audit Committee
 Internal Audit Unit
4) Dedicated Risk Structures
 Risk Register
 Risk Committee
 Risk Management Team

13. THANK YOU TATENDA
01 February 2013 7