Question
Areas of Non-compliance and Recommendations
1. Policy Gaps:
o The current electricity policy does not encompass the treatment of
electricity exports and imports. To enhance reporting accuracy, it is
imperative to integrate export transactions into the DA 176 accounts.
o Additionally, Imports are subjected to VAT payment at Customs, which
must be accounted for appropriately.
o No inflation adjustments of electricity levy rate over ten years, this risk
revenue contribution.
o No levy on renewables, resulting long term fiscal shortfalls as
renewables investments is growth fast pass the non-renewable.
2. Environmental Compliance:
o Eskom recorded eighty (80) environmental compliance contraventions
in 2021, as outline in their integrated report. To address this,
maintaining compliance department is critical. Such dialogue will
ensure these factors are effectively incorporated into future audits
conducted by SARS.
o Environmental violations impact to Carbon Tax should be investigated.
3. Operational and Audit Challenges:
o The audit team encountered significant challenges in obtaining timely
support from Excise management during power station visits hindered
the audit effectiveness.
o It’s recommended that enhancing interdepartmental communication
and collaboration would accelerate information sharing and improve
audit outcomes.
4. Other Departments' Inclusion:
o The Electricity Levy applies only to non-renewable sources, As Eskom
integrates more renewables (solar, wind, and IPPs) the tax base
erodes.
o Coal fleet power stations operational inefficiencies negative impacts
Electricity levy collections as Eskom contributes more than 95%.
o There is a pressing need for the integration of generation,
transmission, and distribution documentation in audit processes. The
application of standardized internal reporting mechanisms such as “DA
32” is recommended to promote data consistency and regulatory
adherence.
Recommendations for Improvement:
1. Implement regular training and education for employees on compliance
standards to enhance understanding of excise responsibilities and
environmental regulations.
2. Develop an integrated approach across generation, transmission, and
distribution sectors to provide clarity in operational and environmental reporting.
3. Establish clearer communication channels with environmental regulators to
address and rectify legal contraventions proactively.
4. Enhance support mechanisms for audit processes to ensure that information is
readily available and that a culture of transparency is fostered.
Conclusion
The audit highlights critical areas requiring immediate attention to ensure enhanced
compliance with environmental legislation and fiscal regulations. As directing bodies
of Eskom Holdings, your engagement in remedying these identified shortcomings is
crucial to fortifying Eskom’s operational integrity and strategic direction. Immediate
steps should be taken to address these findings with applicable corrective and
preventative actions that align with best auditing practices.
May you kindly prepare an closing audit meeting with eskom
1. Policy Gaps:
o The current electricity policy does not encompass the treatment of
electricity exports and imports. To enhance reporting accuracy, it is
imperative to integrate export transactions into the DA 176 accounts.
o Additionally, Imports are subjected to VAT payment at Customs, which
must be accounted for appropriately.
o No inflation adjustments of electricity levy rate over ten years, this risk
revenue contribution.
o No levy on renewables, resulting long term fiscal shortfalls as
renewables investments is growth fast pass the non-renewable.
2. Environmental Compliance:
o Eskom recorded eighty (80) environmental compliance contraventions
in 2021, as outline in their integrated report. To address this,
maintaining compliance department is critical. Such dialogue will
ensure these factors are effectively incorporated into future audits
conducted by SARS.
o Environmental violations impact to Carbon Tax should be investigated.
3. Operational and Audit Challenges:
o The audit team encountered significant challenges in obtaining timely
support from Excise management during power station visits hindered
the audit effectiveness.
o It’s recommended that enhancing interdepartmental communication
and collaboration would accelerate information sharing and improve
audit outcomes.
4. Other Departments' Inclusion:
o The Electricity Levy applies only to non-renewable sources, As Eskom
integrates more renewables (solar, wind, and IPPs) the tax base
erodes.
o Coal fleet power stations operational inefficiencies negative impacts
Electricity levy collections as Eskom contributes more than 95%.
o There is a pressing need for the integration of generation,
transmission, and distribution documentation in audit processes. The
application of standardized internal reporting mechanisms such as “DA
32” is recommended to promote data consistency and regulatory
adherence.
Recommendations for Improvement:
1. Implement regular training and education for employees on compliance
standards to enhance understanding of excise responsibilities and
environmental regulations.
2. Develop an integrated approach across generation, transmission, and
distribution sectors to provide clarity in operational and environmental reporting.
3. Establish clearer communication channels with environmental regulators to
address and rectify legal contraventions proactively.
4. Enhance support mechanisms for audit processes to ensure that information is
readily available and that a culture of transparency is fostered.
Conclusion
The audit highlights critical areas requiring immediate attention to ensure enhanced
compliance with environmental legislation and fiscal regulations. As directing bodies
of Eskom Holdings, your engagement in remedying these identified shortcomings is
crucial to fortifying Eskom’s operational integrity and strategic direction. Immediate
steps should be taken to address these findings with applicable corrective and
preventative actions that align with best auditing practices.
May you kindly prepare an closing audit meeting with eskom
Answers
GPT-4o mini
### Closing Audit Meeting Agenda with Eskom Holdings
**Date:** [Insert Date]
**Time:** [Insert Time]
**Location:** [Insert Location or Video Conference Link]
**Duration:** [Insert Duration]
#### 1. **Welcome and Introductions (5 minutes)**
- Opening remarks by the audit team lead.
- Introduction of all participants.
#### 2. **Purpose of the Meeting (5 minutes)**
- Brief overview of the objectives of the audit meeting.
- Importance of compliance and integration of findings into Eskom’s operational strategy.
#### 3. **Summary of Audit Findings (15 minutes)**
- Present key areas of non-compliance identified during the audit:
- Policy Gaps
- Environmental Compliance
- Operational and Audit Challenges
- Need for Other Departments' Inclusion
#### 4. **Areas of Non-compliance and Recommendations (20 minutes)**
- **Policy Gaps**
- Discuss the need for an updated electricity policy to include export/import transactions and address VAT compliance.
- Emphasize the importance of inflation adjustments on the electricity levy rate.
- Highlight the need for levies on renewables.
- **Environmental Compliance**
- Review incidents of environmental contraventions and necessary steps to improve compliance.
- Address the investigation of carbon tax implications due to violations.
- **Operational and Audit Challenges**
- Discuss challenges faced during the audit and recommend enhancements to interdepartmental communication.
- **Other Departments' Inclusion**
- Evaluate the impact of the current electricity levy policy on renewable energy and propose integration of the documentation process.
#### 5. **Discussion of Recommendations for Improvement (15 minutes)**
- Present the following recommendations:
1. Regular training on compliance standards.
2. Integrated approach across operational sectors.
3. Clearer communication channels with environmental regulators.
4. Enhanced support for audit processes.
#### 6. **Open Discussion (15 minutes)**
- Open the floor for questions, comments, and discussions on findings and recommendations.
- Seek input from Eskom leadership regarding prioritization and implementation of recommendations.
#### 7. **Action Plan Development (15 minutes)**
- Collaboratively outline an action plan to address identified issues and incorporate recommendations.
- Assign responsibilities and timelines for corrective measures.
#### 8. **Conclusion and Next Steps (5 minutes)**
- Recap the meeting’s key points and the importance of addressing audit findings.
- Discuss next steps, including follow-up meetings and progress tracking.
- Thank all participants for their engagement and cooperation.
#### 9. **Closing Remarks (5 minutes)**
- Final thoughts from Eskom leadership.
- Reiterate commitment to improving compliance and operational integrity.
---
**Preparation:**
- Ensure all relevant documentation and reports are accessible during the meeting.
- Confirm attendance of necessary stakeholders from both the audit team and Eskom.
- Distribute the agenda in advance to all participants for preparedness.
#### **Closing Statement:**
"We appreciate everyone's contributions and cooperation during this audit process. It is vital that we work together to implement the necessary changes to strengthen Eskom’s compliance and ensure its sustainable future."
**Date:** [Insert Date]
**Time:** [Insert Time]
**Location:** [Insert Location or Video Conference Link]
**Duration:** [Insert Duration]
#### 1. **Welcome and Introductions (5 minutes)**
- Opening remarks by the audit team lead.
- Introduction of all participants.
#### 2. **Purpose of the Meeting (5 minutes)**
- Brief overview of the objectives of the audit meeting.
- Importance of compliance and integration of findings into Eskom’s operational strategy.
#### 3. **Summary of Audit Findings (15 minutes)**
- Present key areas of non-compliance identified during the audit:
- Policy Gaps
- Environmental Compliance
- Operational and Audit Challenges
- Need for Other Departments' Inclusion
#### 4. **Areas of Non-compliance and Recommendations (20 minutes)**
- **Policy Gaps**
- Discuss the need for an updated electricity policy to include export/import transactions and address VAT compliance.
- Emphasize the importance of inflation adjustments on the electricity levy rate.
- Highlight the need for levies on renewables.
- **Environmental Compliance**
- Review incidents of environmental contraventions and necessary steps to improve compliance.
- Address the investigation of carbon tax implications due to violations.
- **Operational and Audit Challenges**
- Discuss challenges faced during the audit and recommend enhancements to interdepartmental communication.
- **Other Departments' Inclusion**
- Evaluate the impact of the current electricity levy policy on renewable energy and propose integration of the documentation process.
#### 5. **Discussion of Recommendations for Improvement (15 minutes)**
- Present the following recommendations:
1. Regular training on compliance standards.
2. Integrated approach across operational sectors.
3. Clearer communication channels with environmental regulators.
4. Enhanced support for audit processes.
#### 6. **Open Discussion (15 minutes)**
- Open the floor for questions, comments, and discussions on findings and recommendations.
- Seek input from Eskom leadership regarding prioritization and implementation of recommendations.
#### 7. **Action Plan Development (15 minutes)**
- Collaboratively outline an action plan to address identified issues and incorporate recommendations.
- Assign responsibilities and timelines for corrective measures.
#### 8. **Conclusion and Next Steps (5 minutes)**
- Recap the meeting’s key points and the importance of addressing audit findings.
- Discuss next steps, including follow-up meetings and progress tracking.
- Thank all participants for their engagement and cooperation.
#### 9. **Closing Remarks (5 minutes)**
- Final thoughts from Eskom leadership.
- Reiterate commitment to improving compliance and operational integrity.
---
**Preparation:**
- Ensure all relevant documentation and reports are accessible during the meeting.
- Confirm attendance of necessary stakeholders from both the audit team and Eskom.
- Distribute the agenda in advance to all participants for preparedness.
#### **Closing Statement:**
"We appreciate everyone's contributions and cooperation during this audit process. It is vital that we work together to implement the necessary changes to strengthen Eskom’s compliance and ensure its sustainable future."