Technical & training

mSCOA Article 2016: Impact on CFO & Finance Division

November 5, 2016

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MSCOA ARTICLE: IMPACT ON CFO & FINANCE DIVISION

With all municipalities and their respective municipal entities having to implement the Municipal Standard Chart of Accounts (mSCOA) as new classification framework for unified local government transactional information by 1 July 2017, there are still many practical implementation challenges facing local government in the time remaining. Although mSCOA is a multi-dimensional chart which affects all business processes and the IT infrastructure (such as systems, programmes, data), the CFO and the finance team will have various processes and registers to align for mSCOA Compliance.

E.g. in addition to the Matching Integrated Development Plan (IDP) & Project, Function & Region segments (which was due November 2016) and the mSCOA Conversion Budget (due March 2017), the finance divisions of municipalities also need to consider and adjust processes and registers to allow for the municipality to successfully transact in accordance with mSCOA from 1 July 2017. Some of the focus areas for the finance division, amongst others, include:

GRAP reclassify to mSCOA AFS Impact on other processes
  • GRAP AFS Opening balances;
  • Asset registers & asset management;
  • Suspense accounts latest mSCOA Chart & adjustments
  • Impact on Accounting policies.
  • Supply Chain
  • Inventory & Stores
  • Internal allocation of costs.

To find out more about the mSCOA impact for the Finance Division, please refer to the PDF link below to our mSCOA article pertaining to this. Where further support is required, we can assist as per the above-facilitated assessment support as well as capacity building and training.

As to the mSCOA Conversion Budget process, which is due by March 2017. Non-compliance with an mSCOA budget may result in administrative and compliance issues as well as subsequent actions (virements / condonements / irregular expenditure disclosures), please also find a link to our brochure on this.

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