Impact on Budget and Treasury Function

The Budget and Treasury function is the centre of all reporting in line with the requirements of sections 71 and 72 of the Municipal Finance Management Act (MFMA). As a result of the lockdown, municipalities cannot operate and execute their mandates as usual.

KEY CHALLENGES

1. Section 71 submissions may not be completed on time as officials will not be able to perform daily tasks as usual; where submissions are completed, there is a risk that they will not truly reflect all the transactions that should have been recorded within the particular period.
2. The President announced additional funding to municipalities that will require adjustments to current budgets. In addition, municipalities will need to prioritise funding for COVID-19-related support.
3. The effects of the pandemic will have an impact into the next financial year and there is a possibility that year-ends will need to be adjusted that will directly affect the recently approved 2020/21 budgets.

RCA RESPONSE SOLUTIONS

1. Assistance with reconciling submitted data strings to actual transactions incurred.
2. Assistance in ensuring that all bank reconciliations are complete and accurate.
3. Assistance with preparation of a Special Adjustment Budget in line with the Municipal Budget and Reporting Regulation Section 23(2) for additional allocations from National Treasury.
4. Reconstruction of 2020/21 projections based on the current state of affairs—this can be employed to motivate the adjusted budget.
5. Assistance with any other future Special Adjustment Budget in cases where more allocations will be made to the municipality.