Local Government: Municipal Finance Management Act, 2003 (Act No. 56 of 2003)

Chapter 8 : Responsibilities of Municipal Officials

Part 1 : Accounting officers

65. Expenditure management
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(1)The accounting officer of a municipality is responsible for the management of the expenditure of the municipality.

 

(2)The accounting officer must for the purpose of subsection (1) take all reasonable steps to ensure—
(a)That the municipality has and maintains an effective system of expenditure control, including procedures for the approval, authorisation, withdrawal and payment of funds;
(b)That the municipality has and maintains a management, accounting and information system which—
(i)recognises expenditure when it is incurred;
(ii)accounts for creditors of the municipality; and
(iii)accounts for payments made by the municipality;
(c)that the municipality has and maintains a system of internal control in respect of creditors and payments;
(d)that payments by the municipality are made—
(i)directly to the person to whom it is due unless agreed otherwise for reasons as may be prescribed; and
(ii)either electronically or by way of non-transferable cheques, provided that cash payments and payments by way of cash cheques may be made for exceptional reasons only, and only up to a prescribed limit;
(e)that all money owing by the municipality be paid within 30 days of receiving the relevant invoice or statement, unless prescribed otherwise for certain categories of expenditure;
(f)that the municipality complies with its tax, levy, duty, pension, medical aid, audit fees and other statutory commitments;
(g)that any dispute concerning payments due by the municipality to another organ of state is disposed of in terms of legislation regulating disputes between organs of state;
(h)that the municipality's available working capital is managed effectively and economically in terms of the prescribed cash management and investment framework;
(i)that the municipality's supply chain management policy referred to in section 111 is implemented in a way that is fair, equitable, transparent, competitive and cost-effective: and
(j)that all financial accounts of the municipality are closed at the end of each month and reconciled with its records.