Acts Online
GT Shield

Public Finance Management Act, 1999 (Act No. 1 of 1999)

Regulations

Treasury Regulations for Departments, Constitutional Institutions and Public Entities

Part 4 : Revenue and expenditure management

8. Expenditure management

 

8.1 Responsibility of the accounting officer [Section 76(4)(b) of the PFMA]

 

8.1.1 The accounting officer of an institution must ensure that internal procedures and internal control measures are in place for payment approval and processing. These internal controls should provide reasonable assurance that all expenditure is necessary, appropriate, paid promptly and is adequately recorded and reported.

 

8.2 Approval of expenditure [Section 38(1)(f) and 76(4)(b) of the PFMA]

 

8.2.1 An official of an institution may not spend or commit public money except with the approval (either in writing or by duly authorised electronic means) of the accounting officer or a properly delegated or authorised officer.

 

8.2.2 Before approving expenditure or incurring a commitment to spend, the delegated or authorised official must ensure compliance with any limitations or conditions attached to the delegation or authorisation.

 

8.2.3 Unless determined otherwise in a contract or other agreement, all payments due to creditors must be settled within 30 days from receipt of an invoice or, in the case of civil claims, from the date of settlement or court judgement.

 

8.3 Compensation of employees [Section 76(4)(b) of the PFMA]

 

8.3.1 Activities relating to the authorisation of appointments, the authorisation of payments and the recording of those payments may not be performed by the same person.

 

8.3.2 The accounting officer of an institution must ensure that the costs related to compensation of employees, as well as promotion and salary increases, can be met within the budgetary allocation of the institution.

 

8.3.3 Unless otherwise determined by the National Treasury, personnel are divided into the following groups for the payment of salaries—
(a) Group A: Persons who must be paid on the 15th day of the month, or if it is not a working day, on the last working day preceding the 15th. These include—
(i) persons appointed permanently on the fixed establishment and employed in terms of the Public Service Act, 1994; and
(ii) persons appointed on contract in terms of section 8(1)(c) of the Public Service Act, 1994 and other similar legislation.
(b) Group B: This group represents personnel paid on the last working day of the month and includes temporary and part-time staff, and persons appointed on probation.

 

8.3.4 For all employees, the person in charge at the respective pay-points must certify on the date of payment that all persons listed on the payroll report are entitled to payment. Employees paid by cheque must sign the payroll report when collecting their cheques.

 

8.3.5 Within ten days of being certified, the payroll report must be returned to the chief financial officer. The accounting officer must ensure that all pay-point certificates have been received on a monthly basis.

 

8.4 Transfers and subsidies (excluding Division of Revenue grants and other allocations to municipalities) [Section 38(1)(j) of the PFMA]

 

8.4.1 An accounting officer must maintain appropriate measures to ensure that transfers and subsidies to entities are applied for their intended purposes. Such measures may include—
(a) regular reporting procedures;
(b) internal and external audit requirements and, where appropriate, submission of audited statements;
(c) regular monitoring procedures;
(d) scheduled or unscheduled inspection visits or reviews of performance; and
(e) any other control measures deemed necessary.

 

8.4.2 An accounting officer may withhold transfers and subsidies to an entity if he or she is satisfied that—
(a) conditions attached to the transfer and subsidy have not been complied with;
(b) financial assistance is no longer required;
(c) the agreed objectives have not been attained; and
(d) the transfer and subsidy does not provide value for money in relation to its purpose or objectives.

 

8.4.3 Treasury Regulations 8.4.1 and 8.4.2 do not apply to transfers and subsidies to other countries, international bodies, to other bodies in terms of economic and financial agreements and to levies and taxes imposed by other levels of government and which are classified as transfers and subsidies in the budgets of departments. Transfers and subsidies in respect of levies and taxes imposed by other levels and entities of government are governed by section 38(1)(e) of the Act.

 

8.4.4 Transfers and subsidies to other countries, international bodies, other bodies in terms of economic and financial agreements and transfers and subsidies to other levels and entities of government for purposes of paying levies and taxes imposed by legislation are exempt from the written assurance, as required by section 38(1)(j) of the Act.

 

8.5 Division of Revenue Grants [Section 38(1)(i) of the PFMA]

 

8.5.1 Accounting officers of departments transferring funds to other spheres of government in terms of the annual Division of Revenue Act must comply with the provisions of that Act.

 

8.6 Other allocations to municipalities

 

8.6.1 A provincial accounting officer transferring a grant from the provincial revenue fund to a municipality in accordance with an assignment in terms of section 156(4) of The Constitution, 1996 (Act No. 108 of 1996) or a delegation in terms of section 238 of The Constitution, 1996 other than an agency payment in terms of section 238 of The Constitution, 1996 must comply with the relevant provisions of the annual Division of Revenue Act, the Local Government Municipal Finance Management Act (MFMA), 2003 (Act No. 56 of 2003), sections 9 and 10 of the Municipal Systems Act, 2000 (Act 32 of 2000) and other relevant legislation.

 

8.7 Charging of expenditure against a particular vote or main division of a vote [Section 76(2)(b) of the PFMA]

 

8.7.1 Should a dispute arise over which vote or main division of a vote should be charged with any particular expenditure, the relevant treasury must settle the dispute and determine the vote or main division against which the expenditure must be charged.

 

8.8 Recovery, disallowance and adjustment of payments

 

8.8.1 Amounts charged to voted funds, which are recovered in the financial year in which payment was made, shall on or before the closing of books of that financial year, be allocated to the main division that was originally debited.

 

8.8.2 Such amounts which are recovered after the closing of books of a financial year shall be paid to the relevant revenue fund, provided that such amounts have not been allocated to a clearing or suspense account during the financial year in which payment was made.