Page 36 - KZN Film A Report

Area
Explanation
Strategy and objective-setting
KZNFC’s risk appetite is aligned with our strategy and business objectives. How KZNFC translate strategy into practice serves as a basis for identifying, assessing, and responding to risk.
Performance
Risks are prioritised by severity. The organisation responds and takes a holistic view of the risk it has assumed.
Review and revision
By reviewing performance, KZNFC consider how well risk management processes are functioning over time.
Information, communication and reporting
Risk management requires an ongoing process of collecting and sharing information.
KZNFC’s Risk Appetite Framework
It is the responsibility of the KZNFC’s Board to set the risk appetite for the organisation in line with the strategy.
KZNFC developed a risk appetite decision framework to drive risk reporting and management at the appropriate levels within the organisation. The Board and management teams make decisions about risks that may require a change to the strategy, risks that affect operations and the implementation of the strategy, while KZNFC employees make decisions about risks that could potentially impact strategy execution negatively within their delegated authority.
The risk management process undertaken during the year provided a strong foundation and focus for the executive team. It had significantly improved the strategic management and corporate governance of the Entity. KZNFC’s Board believe that strategy, risk performance and sustainable service delivery are inseparable. Quality reviews are undertaken by EXCO and presented to the Audit and Risk Committee (ARC) through quarterly progress made during the year in addressing the strategic and operational risks. A risk register is compiled at the beginning of the financial year. For the 2020/21 financial year, the following areas were identified as high risks areas:
a) Oversight structures not fully/properly constituted in
terms of numbers and relevance to core mandate. The root causes for this risk was identified as the following; lack of timeous appointment of Board members; resignations of Board members due to the reduction of Board fees; conflict of interest would restrict industry practitioners in serving as Board members and appointments of members not based on expertise.
b) The incorporation of KZNFC into Tourism KZN could result in the dilution of the core mandate. The progress to date made on the rationalisation with Tourism KZN has
been placed on hold until Cabinet has made a decision
on the revised incorporation to a merger.
c) Failure to keep abreast with the development of the
fourth Industrial Revolution. The root causes for this risk were identified as the following; failure to keep up with the technological advancements within the industry; lack of resources and lack of thorough understanding of the impact of the fourth industrial revolution.
d) KZNFC was forced to close due to a natural disaster. Due to the COVID-19 pandemic, KZNFC had to temporarily close its offices and shift to working remotely, which resulted in severe service delivery challenges. This risk is still currently one of the highest risks the organisation faces.
The Audit and Risk Committee will continuously monitor the roll-out of risk management to ensure that the process reaches maturity within a reasonable time. The Internal audit will review the progress made to date in order to provide further assurance to the Committee confirming that risks are being managed and mitigated appropriately.
Internal Control
KZNFC is guided by the principles set out in the Public Finance Management Act (PFMA). This means that the entity needs to implement and maintain efficient and effective corporategovernanceandinternalcontrolsystems. Systems of internal control are designed to provide cost-effective assurance that assets are safeguarded, and that liabilities and working capital are efficiently and effectively managed. During the year under review, the Internal Audit function was outsourced to Thornton Dibb Rossal Ubucule (TDRU) Inc. In line with the PFMA and King IV, the Internal Audits provided the Audit and Risk Committee and management
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KZN FILM COMMISSION ANNUAL REPORT 2020/2021