CITY OF

MBOMBELA

____________

2018/2019– FIRST QUARTER BUDGET PERFORMANCE STATEMENT REPORT

2

PART 1 – 2018/2019 FIRST QUARTER BUDGET PERFORMANCE REPORT

1. EXECUTIVE SUMMARY

Budget Performance Statement Summary

Council has on 31 May 2018 under item A (2), in accordance with section 16(1) of the Municipal Finance Management Act 56 of 2003 approved the 2018/2019 budget totaling to R3 841 billion. The approved total operating expenditure amounted to R3 210 billion, while the approved capital expenditure amounted to R630 million. Moreover, the approved total operating revenue budget amounted to R2 800 billion and revenue to be recognized from the capital grants amounted to R537 million. The approved medium-term revenue, operating expenditure and capital expenditure budget amounted to R10 489 billion, R10 063 billion and R1 888 billion respectively as tabulated below.

DESCRIPTION BUDGET YEAR

2018/2019

BUDGET YEAR

2019/2020

BUDGET YEAR

2020/2021

MTREF BUDGET

2018/2019 -

2020/2021

OPERATING REVENUE 2 800 491 060R 2 900 590 167R 3 111 134 663R 8 812 215 890R

CAPITAL GRANTS REVENUE 536 992 301R 534 657 450R 605 131 300R 1 676 781 051R

TOTAL REVENUE 3 337 483 361R 3 435 247 617R 3 716 265 963R 10 488 996 941R

OPERATING EXPENDITURE 3 210 279 485R 3 334 791 814R 3 518 219 598R 10 063 290 897R

TOTAL OPERATING SURPLUS 127 203 876R 100 455 803R 198 046 365R 425 706 044R

GRANTS AND SUBSIDIES 536 992 306R 534 657 447R 605 131 296R 1 676 781 049R

INTERNAL FUNDING 93 600 000R 72 250 000R 45 450 000R 211 300 000R

CAPITAL EXPENDITURE 630 592 306R 606 907 447R 650 581 296R 1 888 081 049R

2018/2019- 2020/2021 APPROVED BUDGET FOR THE CITY OF MBOMBELA LOCAL MUNICIPALITY

The annual approved operating budget reflected a surplus of R127 million for 2018/2019 budget while for 2019/2020 and 2020/2021 operating surpluses amounted to R100 million and R198 million respectively. This therefore resulted in a medium-term operating surplus amounting to R426 million. Council further amended the 2018/2019 original approved budget at the Special Council meeting held 23 August 2018 where an additional amount of R109 million was approved for roll-over capital projects which were not completed during the 2017/2018 financial year. This has therefore increased the capital budget from R630 million to R740 million and total expenditure budget increased from R3 840 billion to R3 950 billion respectively. The table below reflects the amendment to the original budget as outlined above in line with section 28 (e) of the Municipal Finance Management Act no 56 of 2003 read with MFMA circular No 91 together with section 22 of the 2018 Division of Revenue Act (DORA).

3

DESCRIPTION 2018/2019 ORIGINAL

BUDGET

2017/2018

ROLL-OVERS

BUDGET

2018/2019 AMMENDED

BUDGET

OPERATING REVENUE 2 800 491 060R 2 800 491 060R

CAPITAL GRANTS REVENUE 536 992 301R 536 992 301R

TOTAL REVENUE 3 337 483 361R 3 337 483 361R

OPERATING EXPENDITURE 3 210 279 485R 3 210 279 485R

TOTAL OPERATING SURPLUS 127 203 876R 127 203 876R

GRANTS AND SUBSIDIES 536 992 306R 78 782 676R 615 774 982R

INTERNAL FUNDING 93 600 000R 30 335 264R 123 935 264R

CAPITAL EXPENDITURE 630 592 306R 109 117 940R 739 710 246R

2018/2019 AMENDED BUDGET FOR THE CITY OF MBOMBELA LOCAL MUNICIPALITY

The table below provides an overview of the budget and financial performance for the first quarter period ended 30 September 2018. The table illustrates the budget and financial performance for the 2018/2019 first quarter period, reflecting performance summary for each segment of the budget. The City is currently implementing the mSCOA budget on version 6.2 after successful verification by National Treasury.

4

MP326 City of Mbombela - Table C1 Monthly Budget Statement Summary - Q1 First Quarter

2017/18

Audited

Outcome

Original

Budget

Adjusted

Budget

Monthly

actual

YearTD

actual

YearTD

budget

YTD

variance

YTD

variance

Full Year

Forecast

R thousands %

Financial Performance

Property rates 466,134 602,531 602,531 53,756 159,434 150,633 8,801 6% 602,531

Serv ice charges 1,088,910 1,178,525 1,178,525 118,738 328,877 294,631 34,245 12% 1,178,525

Inv estment rev enue 8,581 1,740 1,740 470 2,683 435 2,248 517% 1,740

Transfers and subsidies 776,204 741,061 741,061 15,474 257,129 185,265 71,864 39% 741,061

Other ow n rev enue 138,129 276,634 276,634 22,369 66,122 69,158 (3,037) -4% 276,634

Total Revenue (excluding capital transfers

and contributions)

2,477,958 2,800,491 2,800,491 210,808 814,244 700,123 114,122 16% 2,800,491

Employ ee costs 796,895 887,762 887,762 84,903 228,834 221,940 6,894 3% 887,762

Remuneration of Councillors 38,422 41,696 41,696 3,131 9,538 10,424 (886) -8% 41,696

Depreciation & asset impairment 496,372 540,557 540,557 – – 135,139 (135,139) -100% 540,557

Finance charges 62,349 40,039 40,039 16,560 16,561 10,010 6,551 65% 40,039

Materials and bulk purchases 753,464 791,755 785,599 169,061 173,387 197,310 (23,923) -12% 785,599

Transfers and subsidies 35,502 35,310 34,770 2,534 6,716 8,688 (1,972) -23% 34,770

Other ex penditure 1,105,775 873,161 880,912 59,776 127,818 219,165 (91,346) -42% 880,912

Total Expenditure 3,288,779 3,210,279 3,211,334 335,965 562,855 802,676 (239,821) -30% 3,211,334

Surplus/(Deficit) (810,822) (409,788) (410,843) (125,157) 251,390 (102,553) 353,943 -345% (410,843)

Transfers and subsidies - capital (monetary allocations) (National / Prov incial and District)443,780 536,992 536,992 26,902 78,185 134,248 (56,063) -42% 536,992

Contributions & Contributed assets – – – 803 2,552 – 2,552 #DIV/0! –

Surplus/(Deficit) after capital transfers &

contributions

(367,042) 127,204 126,149 (97,451) 332,127 31,695 300,432 948% 126,149

Share of surplus/ (deficit) of associate – – – – – – – –

Surplus/ (Deficit) for the year (367,042) 127,204 126,149 (97,451) 332,127 31,695 300,432 948% 126,149

Capital expenditure & funds sources

Capital expenditure – 630,592 729,003 26,974 87,390 177,297 (89,907) -51% 729,003

Capital transfers recognised – 536,992 605,068 22,382 68,255 147,345 (79,090) -54% 605,068

Public contributions & donations – – – – – – – –

Borrow ing – – – – – – – –

Internally generated funds – 93,600 123,935 4,592 19,135 29,952 (10,817) -36% 123,935

Total sources of capital funds – 630,592 729,003 26,974 87,390 177,297 (89,907) -51% 729,003

Financial position

Total current assets – 625,976 625,976 530,589 625,976

Total non current assets – 8,041,097 8,139,508 7,658,242 8,139,508

Total current liabilities – 742,927 742,927 1,582,538 742,927

Total non current liabilities – 552,492 552,492 581,804 552,492

Community w ealth/Equity – 7,371,653 7,470,064 6,024,489 7,470,064

Cash flows

Net cash from (used) operating 612,276 584,844 584,844 (12,466) 172,292 675,222 502,930 74% 584,844

Net cash from (used) inv esting (610,544) (584,891) (584,891) (17,916) (88,001) (146,223) (58,222) 40% (584,891)

Net cash from (used) financing (4,223) (27,247) (27,247) (18,592) (49,638) (6,812) 42,826 -629% (27,247)

Cash/cash equivalents at the month/year end 21,373 92,834 92,834 – 127,540 642,315 514,775 80% 65,594

Debtors & creditors analysis 0-30 Days 31-60 Days 61-90 Days 91-120 Days 121-150 Dys 151-180 Dys181 Dys-

1 YrOver 1Yr Total

Debtors Age Analysis

Total By Income Source 146,190 571 50,811 38,587 24,932 23,309 62,054 61,121 407,574

Creditors Age Analysis

Total Creditors 79,967 131,343 99,414 76,625 41,186 19,141 150,306 184,389 782,370

Description

Budget Year 2018/19

5

1. First Quarter Operating budget performance 1.1 First Quarter Revenue performance analysis The table below indicates the detailed operating revenue performance for the first quarter period ended 30 September 2018: It reflects the operating revenue by source and variances thereof. The City generates revenue from the different revenue sources as tabulated below, and constant monitoring is required to ensure that the year to date projected revenue, compared against the year to date actual revenue, does not vary significantly unless otherwise stated. It is against this background that revenue performance analysis must be regularly performed and corrective measures taken where necessary. The performance on the year to date operating revenue budget against the year to date actual is reflected below.

2017/18

Audited

Outcome

Original

Budget

Adjusted

Budget

Monthly

actual

YearTD

actual

YearTD

budget

YTD

variance

YTD

variance

Full Year

Forecast

R thousands %

Revenue By Source

Property rates 466,134 602,531 602,531 53,756 159,434 150,633 8,801 6% 602,531

Serv ice charges - electricity rev enue 872,307 944,852 944,852 98,974 268,292 236,213 32,079 14% 944,852

Serv ice charges - w ater rev enue 88,654 97,758 97,758 8,361 26,154 24,439 1,714 7% 97,758

Serv ice charges - sanitation rev enue 27,222 28,675 28,675 1,717 5,555 7,169 (1,614) -23% 28,675

Serv ice charges - refuse rev enue 100,727 107,241 107,241 9,688 28,876 26,810 2,065 8% 107,241

Serv ice charges - other –

Rental of facilities and equipment 9,878 12,694 12,694 (1,148) (95) 3,174 (3,269) -103% 12,694

Interest earned - ex ternal inv estments 8,581 1,740 1,740 470 2,683 435 2,248 517% 1,740

Interest earned - outstanding debtors 42,909 28,859 28,859 1,162 3,621 7,215 (3,594) -50% 28,859

Div idends receiv ed –

Fines, penalties and forfeits 6,629 8,363 8,363 552 1,399 2,091 (691) -33% 8,363

Licences and permits 3,197 – – – – – – –

Agency serv ices 38,796 198,143 198,143 14,708 43,613 49,536 (5,923) -12% 198,143

Transfers and subsidies 776,204 741,061 741,061 15,474 257,129 185,265 71,864 39% 741,061

Other rev enue 36,720 28,575 28,575 7,094 17,584 7,144 10,440 146% 28,575

Gains on disposal of PPE – – – – – – – –

Total Revenue (excluding capital transfers and

contributions)

2,477,958 2,800,491 2,800,491 210,808 814,244 700,123 114,122 16% 2,800,491

Description Ref

Budget Year 2018/19

MP326 City of Mbombela - Table C4 Monthly Budget Statement - Financial Performance (revenue and expenditure) - Q1 First Quarter

Actual revenue recognised, excluding conditional grants revenue for the first quarter period ended 30 September 2018 amounted to R814 million. The statement of financial performance reflects a year to date first quarter actual revenue amounting to R814 million against a year to date budget projection amount of R700 million thus reflecting an over performance of 16 percent or R114 million.

The over performance of 16 percent or R114 million is mainly attributable to the following revenue sources. (a) Interest earned on external investments over performed by 517 percent or R2

million, mainly resulting from ring-fenced grants received and placed on short term investments. Capital and operating grants received are kept in short term investment which earns the City income in the form of interest.

6

(b) Operational grants revenue received over performed by 39 percent, with a first

quarter actual amount received amounting to R257 million against the year to date projected budget amount of R185 million. This is mainly due to the equitable share grant received during the month of July 2018 amounting to R234 million. Grants allocation is done by National Treasury through its approved grants allocation schedule and the year to date actual allocation received so far is in line with the approved schedule.

(c) Other revenue collected during the reporting period amounted to R28,5 million,

resulting in 146 percent (R10 million) over performance when comparing the year to date actual amount of R17,5 million against the planned target of R7 million. The over performance is attributable to an over collection of bad debts and insurance refunds for assets claimed.

An under performance was however realised on the following revenue streams:

(a) Revenue from rental of facilities and equipment underperformed by 103 percent

or R3 million which is mainly due to the under-utilisation of the stadium facility. (b) Interest on outstanding debtors under performed by 50 percent (R3,5 million)

and this is due to consistence enforcement of council approved debt collection and credit control policy and by-law.

(c) Revenue from traffic fines received during the reporting period amounted to

R552 thousand resulting in an underperformance of 33 percent or R691 thousand, with a year to date actual amount of R1 million received against the year to date budget projection of R2 million. This significant variance is mainly due to the operational accounting of traffic fines on a cash basis during the year and subsequently at year end, on accrual basis of accounting in accordance with the Generally Recognised Accounting Practice Framework.

1.2 First Quarter Operating Expenditure Performance analysis

The table below reflects the detailed operating expenditure performance for the first quarter period ended 30 September 2018. It is the City’s main priority to cut cost while ensuring that critical service delivery is not affected. The implementation of the cost curtailment strategy is therefore paramount in achieving this objective, deeming it critical for the City to continue monitoring spending and ensuring that it is done within the ambit of the policies and the applicable legislation. This will ensure that resources are directed towards the most critical priority areas and there is value for money for all expenditures incurred. The details of all expenditure performance by type is outlined on the table below. It reflects the year to date expenditure projections against the actual year to date expenditure together with variances thereon.

7

2017/18

Audited

Outcome

Original

Budget

Adjusted

Budget

Monthly

actual

YearTD

actual

YearTD

budgetYTD variance YTD variance

Full Year

Forecast

R thousands %

Expenditure By Type

Employ ee related costs 796,895 887,762 887,762 84,903 228,834 221,940 6,894 3% 887,762

Remuneration of councillors 38,422 41,696 41,696 3,131 9,538 10,424 (886) -8% 41,696

Debt impairment 378,673 143,664 141,934 – – 35,743 (35,743) -100% 141,934

Depreciation & asset impairment 496,372 540,557 540,557 – – 135,139 (135,139) -100% 540,557

Finance charges 62,349 40,039 40,039 16,560 16,561 10,010 6,551 65% 40,039

Bulk purchases 706,901 736,187 734,187 165,184 166,077 183,847 (17,770) -10% 734,187

Other materials 46,563 55,567 51,412 3,877 7,310 13,463 (6,153) -46% 51,412

Contracted serv ices 515,689 473,762 487,173 34,367 75,026 120,254 (45,228) -38% 487,173

Transfers and subsidies 35,502 35,310 34,770 2,534 6,716 8,688 (1,972) -23% 34,770

Other ex penditure 207,866 255,735 251,804 25,409 52,793 63,168 (10,375) -16% 251,804

Loss on disposal of PPE 3,548 – – – – – – –

Total Expenditure 3,288,779 3,210,279 3,211,334 335,965 562,855 802,676 (239,821) -30% 3,211,334

MP326 City of Mbombela - Table C4 Monthly Budget Statement - Financial Performance (revenue and expenditure) - M03 September

Description Ref

Budget Year 2018/19

The actual expenditure incurred during the reporting period ended 30 September 2018 amounted to R563 million against the year to date budget amount of R803 million, which resulted in an underperformance or savings of 30 percent or R240 million. Underspending is due to the effective implementation of the cost curtailment strategy resulting targeting spending on critical service delivery programmes and projects. The City must continue to monitor the cost curtailment strategy so as to ensure that objectives of the strategy becomes a reality.

The 30 percent under spending or savings is mainly attributable to the following cost drivers:

(a) Other materials underperformed by 46 percent or R6 million as a result of cost

savings initiatives on refreshments and other materials. This is attributable to the

implementation of the cost curtailment strategy.

(b) Contracted services expenditure underperformed by 38 percent or R45 million from the budget projected amount of R120 million with an actual expenditure amount of R75 million.

(c) Depreciation underperformed by 100 per cent due to the fact that currently the City is in the process of acquiring an asset management subsystem that will seamlessly integrate or interface with the financial system. The City has updated the asset register for the 2017/2018 financial year which was used to prepare the annual financial statements submitted to the Auditor General.

(d) Other Expenditure underperformed by 16 per cent or R10 million with an actual

expenditure amount of R53 million in comparison with the budget projection amount of R63 million.

The overall first quarter operating results for the period ended 30 September 2018 is a surplus of R 332 million which is greater than the planned surplus of R32 million.

8

1.3 Fruitless and wasteful expenditure for the first quarter period

The table below provides a summary of the first quarter fruitless and wasteful

expenditure incurred. An amount of R5 million was incurred as fruitless and wasteful

expenditure due to interest charged by Eskom for late payments. Eskom charges

interest on overdue accounts after 30 days on sending of electricity bill for the bulk

accounts and 15 days for the large power user accounts (LPU’s) in terms of the

Electricity supply agreement.

First Quarter Results for the Fruitless and Wasteful Expenditure

Description Amount

Interest Charged by Eskom due to late payment R5,105,936

1.4 First Quarter Capital expenditure budget analysis

For the month of September 2018, actual capital expenditure amounted to R27 million with the year to date actual expenditure amount of R87 million. The budget projection amount to R177 million and reflects an underperformance of R90 million. For the month of September 2018, an amount of R22 million was spent from conditional grants while R5 million was incurred on projects funded from internal funding. The total amount spent on grants amounted to R68 million and R19 million from internally funded projects. The City will continue to improve spending on all capital projects funded from conditional grants as required by the Division of Revenue Act no 10 of 2014. The capital budget performance for the month of September is outlined below.

2017/18 Budget Year 2018/19

Audited

Outcome

Original

Budget

Adjusted

Budget

Monthly

actual

YearTD

actual

YearTD

budgetYTD variance YTD variance

Full Year

Forecast

R thousands 1 %

Funded by:

National Gov ernment – 536,992 605,068 22,382 68,255 147,345 (79,090) -54% 605,068

Prov incial Gov ernment –

District Municipality –

Other transfers and grants – – – – – – – –

Transfers recognised - capital – 536,992 605,068 22,382 68,255 147,345 (79,090) -54% 605,068

Public contributions & donations 5 – –

Borrowing 6 – –

Internally generated funds – 93,600 123,935 4,592 19,135 29,952 (10,817) -36% 123,935

Total Capital Funding – 630,592 729,003 26,974 87,390 177,297 (89,907) -51% 729,003

MP326 City of Mbombela - Table C5 Monthly Budget Statement - Capital Expenditure (municipal vote, functional classification and funding) - M03

September

Vote Description Ref

9

1.4.1 First quarter capital budget summary per department

The table below reflects comparison results of the capital budget expenditure outcome between the 2017/2018 first quarter period and the 2018/2019 first quarter period.

DEPARTMENT ORIGINAL

BUDGET

AMENDED

BUDGET

JULY 2017

ACTUAL

JULY 2018

ACTUAL

AUGUST

2017

ACTUAL

AUGUST 2018

ACTUAL

SEPTEMBER

2017 ACTUAL

SEPTEMBER

2018 ACTUAL

FIRST

QUARTER

2017 ACTUAL

FIRST

QUARTER

2018 ACTUAL

% SPENT

CITY PLANNING AND DEVELOPMENT 46,889,885R 46,889,885R -R 11,749,082R -R 4,225,082R 1,222,997R 650,338R 1,222,997R 16,624,502R 35%

ENERGY 33,045,000R 37,719,336R -R -R -R 759,245R -R 3,047,902R -R 3,807,147R 10%

PUBLIC WORKS & TRANSPORT 387,322,398R 464,015,708R -R 7,766,037R 2,996,558R 18,929,497R 6,732,519R 17,253,982R 9,729,078R 43,949,516R 9%

WATER AND SANITATION 162,085,023R 157,485,023R -R -R -R 5,075,559R -R 9,086,946R -R 14,162,505R 9%

PUBLIC SAFETY 350,000R 350,000R -R -R -R -R -R -R -R -R 0%

FINANCIAL MANAGEMENT -R 15,777,000R -R 10,459,255R -R 1,444,193R 1,647,520R 3,657,100-R 1,647,520R 8,246,348R 52%

CORPORATE SERVICES -R 3,336,049R -R -R -R -R -R 169,000R -R 169,000R 5%

COMMUNITY SERVICES 900,000R 3,430,332R -R -R -R 8,800R 493,528R 422,440R 493,528R 431,240R 13%

TOTAL BUDGET & EXPENDITURE 630,592,306R 729,003,333R -R 29,974,374R 2,996,558R 30,442,375R 10,096,565R 26,973,508R 13,093,123R 87,390,258R 12%

COMPARISON OF THE FIRST QUARTER CAPITAL BUDGET OUTCOME FOR 2017/2018 AND 2018/2019 PER DEPARTMENT

The 2017/2018 financial year first quarter results for the capital expenditure performance amounted to R13 million while the 2018/2019 financial year first quarter capital budget performance amounted to R87 million. This performance reflects a significant increase of R74 million or 85 per cent. The service delivery departments such as Public works and Transport, City Planning and Development together with Water and sanitation registered the highest spending during the first quarter period ended 30 September 2018. This means that a significant portion of the actual spending for the first quarter period was used for the basic services infrastructure projects.

1.4.2 First quarter capital budget performance per funding sources

The table below reflects capital expenditure performance per funding source for the first quarter period ended 30 September 2018. The table compares capital expenditure per funding source for the 2017/2018 first quarter period with the 2018/2019 first quarter outcome.

FUNDING SOURCE ORIGINAL

BUDGET

AMENDED

BUDGET

JULY 2017

ACTUAL

JULY 2018

ACTUAL

AUGUST

2017

ACTUAL

AUGUST 2018

ACTUAL

SEPTEMBER

2017 ACTUAL

SEPTEMBER

2018 ACTUAL

FIRST

QUARTER

2017 ACTUAL

FIRST

QUARTER

2018 ACTUAL

2018/2019

% SPENT

INTERNAL FUNDING 93,600,000R 123,935,264R -R 10,459,255R -R 4,084,174R 2,141,048R 4,591,786R 2,141,048R 19,135,215R 15%

INTEGRATED NATIONAL ELECTRIFICATION PROGRAMME GRANT31,045,000R 31,045,000R -R -R -R 759,245R -R 3,047,902R -R 3,807,147R 12%

MUNICIPAL INFRASTRUCTURE GRANT 317,131,000R 317,131,004R -R 7,766,037R 2,996,558R 21,373,874R 3,326,820R 17,360,411R 6,323,379R 46,500,323R 15%

NEIGHBOURHOOD DEVELOPMENT PRAGRAMME GRANT33,535,000R 33,535,000R -R 11,749,082R -R 4,225,082R -R 130,191R -R 16,104,355R 48%

PUBLIC TRANSPORT NETWORK GRANT 155,281,301R 223,357,065R -R -R -R -R 4,628,696R 1,843,217R 4,628,696R 1,843,217R 1%

TOTAL BUDGET & EXPENDITURE 630,592,301R 729,003,333R -R 29,974,374R 2,996,558R 30,442,375R 10,096,565R 26,973,508R 13,093,123R 87,390,258R 12%

COMPARISON OF THE FIRST QUARTER CAPITAL BUDGET OUTCOME FOR 2017/2018 AND 2018/2019 PER FUNDING SOURCE

10

Capital expenditure incurred during the first quarter of 2017/2018 amounted to R13 million while capital expenditure for the 2018/2019 first quarter period amounted to R87 million reflecting significant increase in performance by R74 million or 85 per cent. The Municipal Infrastructure grant and Neighbourhood grant registered the highest amount of spending.

Public Transport Network Grant has both operational and capital projects. The overall spending on the grant including both the capital and operational elements amounted to R11 million of which an amount of R2 million was spent on capital budget while R9 million was spent on operational budget. The City will continue to improve spending on all conditional grants allocated to it and spending must be in line with the conditions as stipulated in the Division of Revenue Act and related circulars

1.4.3 Conditional and Unconditional Grants performance statement

The table below reflect total grants and subsidies approved in terms of the Division of Revenue Act no 10 of 2014.

DESCRIPTION

APPROVED

ALLOCATION

JULY 2018

ACTUAL

AUGUST 2018

ACTUAL

SEPTEMBER

2018 ACTUAL

YEAR TO DATE

ACTUAL

BALANCE NOT

SPENT % SPENT

Finance Management Grant 3,470,000R 181,428R 47,603R 89,934R 318,965R 3,151,035R 9%

Municipal Infrastructure Grant 336,980,000R 8,930,943R 24,579,956R 19,964,473R 53,475,372R 283,504,628R 16%

Intergrated National Electrification Programme 31,045,000R 873,132R 3,505,087R 4,378,219R 26,666,781R 14%

Neighbourhood Partnership Grant 33,535,000R 13,511,444R 4,858,844R 149,720R 18,520,008R 15,014,992R 55%

Public Transport Network Grant 203,454,000R 1,992,375R 9,433,736R 11,426,111R 192,027,889R 6%

Expanded PWP Programme Incentive Grant 8,240,000R 527,332R 1,106,870R 1,038,957R 2,673,159R 5,566,841R 32%

Equitable Share 661,329,000R 55,110,750R 55,110,750R 55,110,750R 165,332,250R 495,996,750R 25%

TOTAL 1,278,053,000R 78,261,897R 88,569,530R 89,292,656R 256,124,084R 1,021,928,916R 20%

2018/19 GRANT EXPENDITURE FOR THE PERIOD ENDED 30 SEPTEMBER 2018

Total grants allocated to the City of Mbombela for the year 2018/2019 financial year amounted to R1,2 billion and R661 million of the total allocation is for the equitable share grant. The year to date actual expenditure amounted to R256 million, with equitable share expenditure sitting at R165 million followed by the Municipal Infrastructure Grant expenditure sitting at R59 million, while Neighbourhood development Grant expenditure amounted to R22 million.

11

1.4.3.1 Conditional and Unconditional Grants Receipts

The table below reflects the performance of all grants received for the period ending 30 September 2018.

DESCRIPTION APPROVED

ALLOCATION

JULY 2018

ACTUAL

AUGUST 2018

ACTUAL

SEPTEMBER

2018 ACTUAL

YEAR TO DATE

RECEIVED

BALANCE NOT

RECEIVED

ACTUAL %

RECEIVED

Finance Management Grant 3,470,000R -R 3,470,000R -R 3,470,000R -R 100%

Municipal Infrastructure Grant 336,980,000R 193,848,000R -R -R 193,848,000R 143,132,000R 58%

Intergrated National Electrification Programme 31,045,000R 9,500,000R -R -R 9,500,000R 21,545,000R 31%

Neighbourhood Partnership Grant 33,535,000R 8,500,000R -R 4,500,000R 13,000,000R 20,535,000R 39%

Public Transport Network Grant 203,454,000R 25,432,000R -R -R 25,432,000R 178,022,000R 13%

Expanded PWP Programme Incentive Grant 8,240,000R -R 2,060,000R -R 2,060,000R 6,180,000R 25%

Equitable Share 661,329,000R 234,000,000R -R -R 234,000,000R 427,329,000R 35%

TOTAL 1,278,053,000R 471,280,054R 5,530,056R 4,500,000R 481,310,000R 796,743,000R 38%

2018/19 GRANT RECEIPTS FOR THE FIRST QUARTER PERIOD ENDED 30 SEPTEMBER 2018

The year to date actual grants received amounted to R481 million. An amount of R234 million was received for the equitable share allocation while R194 million was received for the Municipal Infrastructure Grant and R25 million received for the Public Transport Network Grant. The total amount received during the month of September was R4,5 million in respect of Neighbourhood Development Partnership Grant. The transfer of approved allocation to the City is done by national Treasury, in accordance with the approved payment schedule and spending on all conditional grants must be in line with the conditions stipulated in the Division of Revenue Act no 10 of 2014.

1.5 Cash-flow budget performance

The net cash flows from operating activities amounts to R172 million. Cash utilised for investing activities amounted to R88 million in comparison with the R146 million planned budget projection.

An amount of R50 million was used for repayment of borrowings. The cash and cash equivalents as at 30 September 2018 reflect a favourable balance of R127 million.

12

2017/18 Budget Year 2018/19

Audited

Outcome

Original

Budget

Adjusted

Budget

Monthly

actual

YearTD

actual

YearTD

budget

YTD

variance

YTD

variance

Full Year

Forecast

R thousands 1 %

CASH FLOW FROM OPERATING ACTIVITIES

Receipts

Property rates 374,822 554,329 554,329 36,225 125,705 138,582 (12,877) -9% 554,329

Serv ice charges 834,900 1,084,243 1,084,243 81,887 224,244 271,061 (46,817) -17% 1,084,243

Other rev enue 56,154 245,530 245,530 17,200 56,485 61,383 (4,898) -8% 245,530

Gov ernment - operating 494,368 741,061 741,061 – 234,975 185,265 49,710 27% 741,061

Gov ernment - capital 633,202 521,937 521,937 803 2,796 130,484 (127,688) -98% 521,937

Interest 28,240 28,151 28,151 339 2,448 7,038 (4,590) -65% 28,151

Div idends – – – – – - – –

Payments

Suppliers and employ ees (1,723,849) (2,517,972) (2,517,972) (145,379) (467,832) (116,958) 350,874 -300% (2,517,972)

Finance charges (46,290) (37,165) (37,165) – – – (37,165)

Transfers and Grants (39,271) (35,270) (35,270) (3,542) (6,530) (1,632) 4,897 -300% (35,270)

NET CASH FROM/(USED) OPERATING ACTIVITIES 612,276 584,844 584,844 (12,466) 172,292 675,222 502,930 74% 584,844

CASH FLOWS FROM INVESTING ACTIVITIES

Receipts

Proceeds on disposal of PPE – – – – – – – –

Decrease (Increase) in non-current debtors 15,000 15,000 – – 3,750 (3,750) -100% 15,000

Decrease (increase) other non-current receiv ables (835) – – – –

Decrease (increase) in non-current inv estments – – – – –

Payments

Capital assets (609,709) (599,891) (599,891) (17,916) (88,001) (149,973) (61,972) 41% (599,891)

NET CASH FROM/(USED) INVESTING ACTIVITIES (610,544) (584,891) (584,891) (17,916) (88,001) (146,223) (58,222) 40% (584,891)

CASH FLOWS FROM FINANCING ACTIVITIES

Receipts

Short term loans –

Borrow ing long term/refinancing –

Increase (decrease) in consumer deposits –

Payments

Repay ment of borrow ing (4,223) (27,247) (27,247) (18,592) (49,638) (6,812) 42,826 -629% (27,247)

NET CASH FROM/(USED) FINANCING ACTIVITIES (4,223) (27,247) (27,247) (18,592) (49,638) (6,812) 42,826 -629% (27,247)

NET INCREASE/ (DECREASE) IN CASH HELD (2,491) (27,293) (27,293) (48,974) 34,653 522,188 (27,293)

Cash/cash equiv alents at beginning: 23,864 120,127 120,127 92,887 120,127 92,887

Cash/cash equiv alents at month/y ear end: 21,373 92,834 92,834 127,540 642,315 65,594

Description Ref

MP326 City of Mbombela - Table C7 Monthly Budget Statement - Cash Flow - M03 September

The bank and investment accounts portfolio of the municipality as at 30 September 2018 is tabulated below.

Description July 2018 August 2018 September 2018

Operational Bank Account 90,932,857R 67,199,686R 62,836,147R

Conditional Grants Bank Accounts 504,090R 505,260R 506,598R

Non-Current Investments Accounts 18,494,420R 18,591,807R -R

Current Investments Accounts 150,000,000R 100,000,000R -R

Total Bank Balance 259,931,367R 186,296,754R 63,342,745R

BANK AND INVESTMENT PORTFOLIO FOR THE CITY OF MBOMBELA LOCAL MUNICIPALITY

At the end of September 2018, the operational bank account for the City had an amount of R63 million. The bank balance as at 30 September 2018 amounted to R63 million.

13

1.6 Current Assets - Account Receivables (Debtors)

Trade receivables or debtors amounting to R407 million were outstanding as at 30 September 2018 in comparison with an amount of R264 million for trade receivables as at 30 June 2018.

The monthly average collection rate for the period ended 30 September 2018 was 82 percent on the current account, thus reflecting an under performance of 10 percent against the projected collection rate of 92 per cent.

1.6.1 Credit Control Enforcement

As a result of credit control measures implemented during the reporting period ended 30 September 2018, an amount of R49 million was collected and levies to the amount of R1,4 million was paid for services rendered.

MONTH

DESCRIPTION LEVIES CASH

JULY R 266,008 R 16,987,392

AUGUST R 547,475 R 17,308,505

SEPTEMBER 599,789R R 14,363,377

TOTAL 1,413,272R 48,659,274R

2018/2019 FIRST QUARTER CREDIT CONTROL ENFORCEMENT RESULTS

FINANCIAL INFORMATION

14

1.7 Current Liabilities - Account Payables (Creditors)

The trade payables as at 30 September 2018 amounted to R782 million compared with the trade payables balance of R1,4 billion as per the annual financial statements for the year ended 30 June 2018.

1.8 Non–Current Liabilities- Interest Bearing Borrowings

The table below outlines the schedule of interest bearing borrowings as at 30 September 2018.

Capital Interest Received

DBSA 15-05-1998 18 YEARS 22,000,000R -R -R

DBSA ( 61000942) 31-12-2030 20 YEARS 200,000,000R 126,536,792R -R 219,177R -R 126,536,792R

DBSA ( 61007101) 29-06-2029 15 YEARS 138,600,000R 126,310,249R 9,898,209R -R -R 116,412,041R

DBSA ( 61007226) 30-06-2019 5 YEARS 21,600,000R 10,279,209R 8,537,583R -R -R 1,741,626R

STD Bank(406816) 15 YEARS 25,000,000R 5,746,975R -R -R -R 5,746,975R

DBSA ( 61001347 ) 31-03-2018 20 YEARS 1,881,822R -R -R -R -R -R

DBSA ( 61003110) 31-03-2019 20 YEARS 1,417,073R 212,306R -R -R -R 212,306R

DBSA ( 61003142) 30-09-2019 20 YEARS 915,450R 212,678R -R -R -R 212,678R

411,414,345.76R 269,298,209.10R 18,435,791.48R 219,177.15R -R 250,862,417.62R

STATEMENT OF LONG-TERM BORROWINGS FOR THE CITY OF MBOMBELA

Total

LOAN BALANCE AS

AT 30/09/2018BORROWER

LOAN

REDEMPTION LOAN TERM

ORIGINAL LOAN

AMOUNT

LOAN BALANCE AS

AT 01/09/2018

Actual repayment

A total repayment of R19 million was made during the month. No repayments were made for the long-term borrowings. The total long-term loans outstanding balance for the period ended 31 August 2018 amounted to R269 million while the long term balance at the end of September 2018 amounted to R251 million.

Description 31 July 2018 31 August 2018

30 September 2018

Eskom R284 Million R239 Million R249 Million

Department of Water Affairs R134 Million R134 Million R134 Million

Trade Creditors R135 Million R108 Million R196 Million

Department of Safety and Community liaison

R160 Million R159 Million R180 Million

Other Payables R1 Million R1 Million R23 Million

Total Payables R714 Million R641 Million R782 Million

15

IN-YEAR BUDGET STATEMENTS TABLES

Table C2: Financial Performance by Vote

Table C2 measures the monthly actuals against the year to date SDBIP figures which are realised per vote for revenue and expenditure.

2017/18 Budget Year 2018/19

Audited

Outcome

Original

Budget

Adjusted

Budget

Monthly

actual

YearTD

actual

YearTD

budget

YTD

variance

YTD

variance

Full Year

Forecast

R thousands 1 %

Revenue - Functional

Governance and administration 1,163,393 1,326,574 1,326,574 57,909 413,270 331,644 81,626 25% 1,326,574

Ex ecutiv e and council 403 865 865 5 15 216 (201) -93% 865

Finance and administration 1,162,990 1,325,710 1,325,710 57,903 413,255 331,427 81,828 25% 1,325,710

Internal audit – 0 0 – – 0 (0) -100% 0

Community and public safety 5,838 5,316 5,316 186 542 1,329 (787) -59% 5,316

Community and social serv ices 1,589 825 825 137 433 206 226 110% 825

Sport and recreation 4,036 4,398 4,398 49 93 1,100 (1,006) -92% 4,398

Public safety 214 93 93 0 16 23 (7) -32% 93

Housing – – – – – – – –

Health – – – – – – – –

Economic and environmental services 587,571 783,789 783,789 57,690 146,920 195,947 (49,028) -25% 783,789

Planning and dev elopment 543,064 576,963 576,963 41,644 99,369 144,241 (44,871) -31% 576,963

Road transport 44,508 206,826 206,826 16,047 47,550 51,706 (4,156) -8% 206,826

Env ironmental protection – 0 0 – – 0 (0) -100% 0

Trading services 1,164,935 1,221,804 1,221,804 122,728 334,250 305,451 28,799 9% 1,221,804

Energy sources 912,852 975,889 975,889 102,490 272,684 243,972 28,712 12% 975,889

Water management 124,022 101,759 101,759 8,833 27,135 25,440 1,696 7% 101,759

Waste w ater management 27,229 28,675 28,675 1,717 5,555 7,169 (1,614) -23% 28,675

Waste management 100,831 115,481 115,481 9,688 28,876 28,870 5 0% 115,481

Other 4 – – – – – – – –

Total Revenue - Functional 2 2,921,738 3,337,483 3,337,483 238,513 894,982 834,371 60,611 7% 3,337,483

Expenditure - Functional

Governance and administration 922,985 679,656 669,239 51,792 126,246 168,245 (42,000) -25% 669,239

Ex ecutiv e and council 191,811 157,130 150,359 9,316 25,785 38,164 (12,379) -32% 150,359

Finance and administration 726,763 517,013 511,577 40,937 97,405 128,524 (31,120) -24% 511,577

Internal audit 4,411 5,514 7,304 1,540 3,056 1,557 1,498 96% 7,304

Community and public safety 264,576 310,832 316,288 17,328 50,846 78,459 (27,612) -35% 316,288

Community and social serv ices 44,426 64,104 66,104 4,055 10,608 16,226 (5,618) -35% 66,104

Sport and recreation 161,411 191,163 194,813 8,777 28,332 48,360 (20,028) -41% 194,813

Public safety 35,395 43,611 43,613 3,810 9,635 10,903 (1,268) -12% 43,613

Housing 23,344 11,954 11,758 686 2,271 2,969 (698) -24% 11,758

Health – – – – – – – –

Economic and environmental services 553,671 628,276 636,255 53,782 106,641 158,520 (51,879) -33% 636,255

Planning and dev elopment 315,427 164,740 170,334 19,079 31,067 42,030 (10,963) -26% 170,334

Road transport 224,971 455,766 454,271 33,210 73,332 113,792 (40,460) -36% 454,271

Env ironmental protection 13,272 7,770 11,650 1,493 2,242 2,698 (456) -17% 11,650

Trading services 1,534,291 1,559,724 1,557,726 211,751 275,675 389,496 (113,821) -29% 1,557,726

Energy sources 803,364 877,481 875,481 172,648 184,647 219,170 (34,524) -16% 875,481

Water management 295,292 315,548 316,398 20,112 43,144 78,732 (35,588) -45% 316,398

Waste w ater management 159,655 135,490 135,507 1,153 3,926 33,878 (29,951) -88% 135,507

Waste management 275,979 231,205 230,340 17,837 43,958 57,716 (13,758) -24% 230,340

Other 13,257 31,791 31,826 1,312 3,447 7,956 (4,509) -57% 31,826

Total Expenditure - Functional 3 3,288,779 3,210,279 3,211,334 335,965 562,855 802,676 (239,821) -30% 3,211,334

Surplus/ (Deficit) for the year (367,042) 127,204 126,149 (97,451) 332,127 31,695 300,432 948% 126,149

RefDescription

MP326 City of Mbombela - Table C2 Monthly Budget Statement - Financial Performance (functional classification) - M03 September

16

1.1 Table C4: Financial Performance by Revenue Source and Expenditure Type

This table below provides the details for revenue by source and expenditure by type for the period ended 30 September 2018.

2017/18

Audited

Outcome

Original

Budget

Adjusted

Budget

Monthly

actual

YearTD

actual

YearTD

budget

YTD

variance

YTD

variance

Full Year

Forecast

R thousands %

Revenue By Source

Property rates 466,134 602,531 602,531 53,756 159,434 150,633 8,801 6% 602,531

Serv ice charges - electricity rev enue 872,307 944,852 944,852 98,974 268,292 236,213 32,079 14% 944,852

Serv ice charges - w ater rev enue 88,654 97,758 97,758 8,361 26,154 24,439 1,714 7% 97,758

Serv ice charges - sanitation rev enue 27,222 28,675 28,675 1,717 5,555 7,169 (1,614) -23% 28,675

Serv ice charges - refuse rev enue 100,727 107,241 107,241 9,688 28,876 26,810 2,065 8% 107,241

Serv ice charges - other –

Rental of facilities and equipment 9,878 12,694 12,694 (1,148) (95) 3,174 (3,269) -103% 12,694

Interest earned - ex ternal inv estments 8,581 1,740 1,740 470 2,683 435 2,248 517% 1,740

Interest earned - outstanding debtors 42,909 28,859 28,859 1,162 3,621 7,215 (3,594) -50% 28,859

Div idends receiv ed –

Fines, penalties and forfeits 6,629 8,363 8,363 552 1,399 2,091 (691) -33% 8,363

Licences and permits 3,197 – – 14,708 43,613 – 43,613 #DIV/0! –

Agency serv ices 38,796 198,143 198,143 – – 49,536 (49,536) -100% 198,143

Transfers and subsidies 776,204 741,061 741,061 15,474 257,129 185,265 71,864 39% 741,061

Other rev enue 36,720 28,575 28,575 7,094 17,584 7,144 10,440 146% 28,575

Gains on disposal of PPE – – – – – – – –

Total Revenue (excluding capital transfers and

contributions)

2,477,958 2,800,491 2,800,491 210,808 814,244 700,123 114,122 16% 2,800,491

Expenditure By Type

Employ ee related costs 796,895 887,762 887,762 84,903 228,834 221,940 6,894 3% 887,762

Remuneration of councillors 38,422 41,696 41,696 3,131 9,538 10,424 (886) -8% 41,696

Debt impairment 378,673 143,664 141,934 – – 35,743 (35,743) -100% 141,934

Depreciation & asset impairment 496,372 540,557 540,557 – – 135,139 (135,139) -100% 540,557

Finance charges 62,349 40,039 40,039 16,560 16,561 10,010 6,551 65% 40,039

Bulk purchases 706,901 736,187 734,187 165,184 166,077 183,847 (17,770) -10% 734,187

Other materials 46,563 55,567 51,412 3,877 7,310 13,463 (6,153) -46% 51,412

Contracted serv ices 515,689 473,762 487,173 34,367 75,026 120,254 (45,228) -38% 487,173

Transfers and subsidies 35,502 35,310 34,770 2,534 6,716 8,688 (1,972) -23% 34,770

Other ex penditure 207,866 255,735 251,804 25,409 52,793 63,168 (10,375) -16% 251,804

Loss on disposal of PPE 3,548 – – – – – – –

Total Expenditure 3,288,779 3,210,279 3,211,334 335,965 562,855 802,676 (239,821) -30% 3,211,334

Surplus/(Deficit) (810,822) (409,788) (410,843) (125,157) 251,390 (102,553) 353,943 (0) (410,843) Transfers and subsidies - capital (monetary allocations)

(National / Prov incial and District) 443,780 536,992 536,992 26,902 78,185 134,248 (56,063) (0) 536,992 Transfers and subsidies - capital (monetary allocations)

(National / Prov incial Departmental Agencies,

Households, Non-profit Institutions, Priv ate Enterprises,

Public Corporatons, Higher Educational Institutions) – – – – – – – –

Transfers and subsidies - capital (in-kind - all) – – – 803 2,552 – 2,552 #DIV/0! –

Surplus/(Deficit) after capital transfers &

contributions

(367,042) 127,204 126,149 (97,451) 332,127 31,695 126,149

Tax ation – – – – – – – –

Surplus/(Deficit) after taxation (367,042) 127,204 126,149 (97,451) 332,127 31,695 126,149

Attributable to minorities – – – – – – –

Surplus/(Deficit) attributable to municipality (367,042) 127,204 126,149 (97,451) 332,127 31,695 126,149

Share of surplus/ (deficit) of associate – – – – – – –

Surplus/ (Deficit) for the year (367,042) 127,204 126,149 (97,451) 332,127 31,695 126,149

Description Ref

Budget Year 2018/19

MP326 City of Mbombela - Table C4 Monthly Budget Statement - Financial Performance (revenue and expenditure) - M03 September

17

1.2 Table C5: Capital Expenditure by Vote

Table C5 indicates the actuals figures on capital expenditure for all votes and measures the year-to-date actuals against the year to date planning (SDBIP) figures. For the month of September 2018, capital expenditure amounting to R27 million was incurred.

2017/18 Budget Year 2018/19

Audited

Outcome

Original

Budget

Adjusted

Budget

Monthly

actual

YearTD

actual

YearTD

budget

YTD

variance

YTD

variance

Full Year

Forecast

R thousands 1 %

Multi-Year expenditure appropriation 2

Vote 01 - Council – – – – – – – –

Vote 02 - Office Of Council – – – – – – – –

Vote 03 - Municipal Manager – – – – – – – –

Vote 04 - City Planning And Dev elopment Department – 2,750 2,750 – – 687 (687) -100% 2,750

Vote 05 - Corporate Serv ices Department – – – – – – – –

Vote 06 - Strategic Management Serv ices – – – – – – – –

Vote 07 - Financial Management – – – – – – – –

Vote 08 - Legal Serv ices – – – – – – – –

Vote 09 - Regional Centre Coordination – – – – – – – –

Vote 10 - Community Serv ices – – – – – – – –

Vote 11 - Public Works, Roads And Transport – 167,781 191,733 1,038 1,038 46,300 (45,262) -98% 191,733

Vote 12 - Public Safety – – – – – – – –

Vote 13 - Water And Sanitation – 36,219 33,119 491 1,667 8,491 (6,824) -80% 33,119

Vote 14 - Energy – 16,545 16,545 3,048 3,807 4,136 (329) -8% 16,545

Vote 15 - Other – – – – – – – –

Total Capital Multi-year expenditure 4,7 – 223,295 244,147 4,578 6,513 59,615 (53,102) -89% 244,147

Single Year expenditure appropriation 2

Vote 01 - Council – – – – – – – –

Vote 02 - Office Of Council – – – – – – – –

Vote 03 - Municipal Manager – – – – – – – –

Vote 04 - City Planning And Dev elopment Department – 44,140 44,140 650 16,625 11,035 5,590 51% 44,140

Vote 05 - Corporate Serv ices Department – – 3,336 169 169 607 (438) -72% 3,336

Vote 06 - Strategic Management Serv ices – – – – – – – –

Vote 07 - Financial Management – – 15,777 (3,657) 8,246 3,905 4,341 111% 15,777

Vote 08 - Legal Serv ices – – – – – – – –

Vote 09 - Regional Centre Coordination – – – – – – – –

Vote 10 - Community Serv ices – 900 3,430 422 431 685 (254) -37% 3,430

Vote 11 - Public Works, Roads And Transport – 219,541 272,283 16,216 42,911 64,884 (21,973) -34% 272,283

Vote 12 - Public Safety – 350 350 – – 87 (87) -100% 350

Vote 13 - Water And Sanitation – 125,866 124,366 8,595 12,495 31,505 (19,009) -60% 124,366

Vote 14 - Energy – 16,500 21,174 – – 4,975 (4,975) -100% 21,174

Vote 15 - Other – – – – – – – –

Total Capital single-year expenditure 4 – 407,297 484,857 22,396 80,878 117,682 (36,805) -31% 484,857

Total Capital Expenditure – 630,592 729,003 26,974 87,390 177,297 (89,907) -51% 729,003

Capital Expenditure - Functional Classification

Governance and administration – – 19,113 (3,488) 8,415 4,511 3,904 87% 19,113

Ex ecutiv e and council – – – – – – – –

Finance and administration – – 19,113 (3,488) 8,415 4,511 3,904 87% 19,113

Internal audit – –

Community and public safety – 39,410 40,840 3,046 3,507 10,112 (6,605) -65% 40,840

Community and social serv ices – 23,850 25,257 1,881 2,333 6,218 (3,885) -62% 25,257

Sport and recreation – 15,560 15,583 1,165 1,174 3,894 (2,720) -70% 15,583

Public safety – – – – – – – –

Housing – – – – – – – –

Health –

Economic and environmental services – 330,578 406,817 12,020 45,184 96,715 (51,531) -53% 406,817

Planning and dev elopment – 70,098 70,442 130 16,104 17,587 (1,483) -8% 70,442

Road transport – 260,480 336,375 11,890 29,080 79,128 (50,048) -63% 336,375

Env ironmental protection – –

Trading services – 252,999 254,628 14,875 29,763 64,057 (34,294) -54% 254,628

Energy sources – 33,045 37,719 3,048 3,807 9,111 (5,304) -58% 37,719

Water management – 150,075 145,475 10,114 14,135 36,993 (22,858) -62% 145,475

Waste w ater management – 69,879 69,434 1,714 11,821 17,589 (5,768) -33% 69,434

Waste management – – 2,000 – – 364 (364) -100% 2,000

Other – 7,605 7,605 520 520 1,901 (1,381) -73% 7,605

Total Capital Expenditure - Functional Classification 3 – 630,592 729,003 26,974 87,390 177,297 (89,907) -51% 729,003

Funded by:

National Gov ernment – 536,992 605,068 22,382 68,255 147,345 (79,090) -54% 605,068

Prov incial Gov ernment –

District Municipality –

Other transfers and grants – – – – – – – –

Transfers recognised - capital – 536,992 605,068 22,382 68,255 147,345 (79,090) -54% 605,068

Public contributions & donations 5 – –

Borrowing 6 – –

Internally generated funds – 93,600 123,935 4,592 19,135 29,952 (10,817) -36% 123,935

Total Capital Funding – 630,592 729,003 26,974 87,390 177,297 (89,907) -51% 729,003

MP326 City of Mbombela - Table C5 Monthly Budget Statement - Capital Expenditure (municipal vote, functional classification and funding) - M03

September

Vote Description Ref

18

1.3 Table C7: Budget Cash Flow Statement

Table C7 provides details of the monthly cash in and out flows. The cash and cash equivalents balance at the end of September 2018 amounted to R127 million, net-cash received from operating activities was R172 million, R88 million amount spent on investing activities, and cash and cash equivalent for September 2018 amounted to R127 million.

2017/18 Budget Year 2018/19

Audited

Outcome

Original

Budget

Adjusted

Budget

Monthly

actual

YearTD

actual

YearTD

budget

YTD

variance

YTD

variance

Full Year

Forecast

R thousands 1 %

CASH FLOW FROM OPERATING ACTIVITIES

Receipts

Property rates 374,822 554,329 554,329 36,225 125,705 138,582 (12,877) -9% 554,329

Serv ice charges 834,900 1,084,243 1,084,243 81,887 224,244 271,061 (46,817) -17% 1,084,243

Other rev enue 56,154 245,530 245,530 17,200 56,485 61,383 (4,898) -8% 245,530

Gov ernment - operating 494,368 741,061 741,061 – 234,975 185,265 49,710 27% 741,061

Gov ernment - capital 633,202 521,937 521,937 803 2,796 130,484 (127,688) -98% 521,937

Interest 28,240 28,151 28,151 339 2,448 7,038 (4,590) -65% 28,151

Div idends – – – – – - – –

Payments

Suppliers and employ ees (1,723,849) (2,517,972) (2,517,972) (145,379) (467,832) (116,958) 350,874 -300% (2,517,972)

Finance charges (46,290) (37,165) (37,165) – – – (37,165)

Transfers and Grants (39,271) (35,270) (35,270) (3,542) (6,530) (1,632) 4,897 -300% (35,270)

NET CASH FROM/(USED) OPERATING ACTIVITIES 612,276 584,844 584,844 (12,466) 172,292 675,222 502,930 74% 584,844

CASH FLOWS FROM INVESTING ACTIVITIES

Receipts

Proceeds on disposal of PPE – – – – – – – –

Decrease (Increase) in non-current debtors 15,000 15,000 – – 3,750 (3,750) -100% 15,000

Decrease (increase) other non-current receiv ables (835) – – – –

Decrease (increase) in non-current inv estments – – – – –

Payments

Capital assets (609,709) (599,891) (599,891) (17,916) (88,001) (149,973) (61,972) 41% (599,891)

NET CASH FROM/(USED) INVESTING ACTIVITIES (610,544) (584,891) (584,891) (17,916) (88,001) (146,223) (58,222) 40% (584,891)

CASH FLOWS FROM FINANCING ACTIVITIES

Receipts

Short term loans –

Borrow ing long term/refinancing –

Increase (decrease) in consumer deposits –

Payments

Repay ment of borrow ing (4,223) (27,247) (27,247) (18,592) (49,638) (6,812) 42,826 -629% (27,247)

NET CASH FROM/(USED) FINANCING ACTIVITIES (4,223) (27,247) (27,247) (18,592) (49,638) (6,812) 42,826 -629% (27,247)

NET INCREASE/ (DECREASE) IN CASH HELD (2,491) (27,293) (27,293) (48,974) 34,653 522,188 (27,293)

Cash/cash equiv alents at beginning: 23,864 120,127 120,127 92,887 120,127 92,887

Cash/cash equiv alents at month/y ear end: 21,373 92,834 92,834 127,540 642,315 65,594

Description Ref

MP326 City of Mbombela - Table C7 Monthly Budget Statement - Cash Flow - Q1 First Quarter

19

PART 2 – SUPPORTING DOCUMENTATION AND ADDITIONAL INFORMATION

2.1 Trade Receivables (debtors) Analysis

Supporting table SC3 provides a breakdown of the consumer debtors. The outstanding debtors at the end of September 2018 amounted to R407 million.

The debt of R407 million consists of R146 million (36 per cent of the total debt of R407 million) which is collectable within 30 days, R51 million which is between 31 and 90 days overdue and R210 million which is more than 90 days old (52 percent of the total debt of R407 million). Irrecoverable bad debts amounting R366 were written off by the City during the 2017/18 financial period. Continuous aggressive implementation of the credit control and debt collection measures is required to ensure that all funds for services rendered as well as rates services are paid to the City.

Description

R thousands

NT

Code0-30 Days 31-60 Days 61-90 Days 91-120 Days 121-150 Dys 151-180 Dys 181 Dys-1 Yr Over 1Yr Total

Total

over 90

days

Actual Bad

Debts Written

Off against

Debtors

Impairment -

Bad Debts i.t.o

Council Policy

Debtors Age Analysis By Income Source

Trade and Other Receiv ables from Ex change Transactions - Water 1200 8,049 187 6,537 4,794 2,463 2,572 5,308 3,201 33,110 18,338

Trade and Other Receiv ables from Ex change Transactions - Electricity 1300 79,263 140 14,350 9,732 5,547 4,376 9,144 3,398 125,951 32,197

Receiv ables from Non-ex change Transactions - Property Rates 1400 40,538 100 21,582 17,201 7,763 7,409 25,636 37,340 157,569 95,349

Receiv ables from Ex change Transactions - Waste Water Management 1500 1,635 3 961 827 1,087 1,101 2,308 1,044 8,966 6,367

Receiv ables from Ex change Transactions - Waste Management 1600 8,536 14 4,679 3,432 2,876 2,744 6,460 3,445 32,186 18,957

Receiv ables from Ex change Transactions - Property Rental Debtors 1700 2,402 – 185 184 164 298 833 337 4,404 1,817

Interest on Arrear Debtor Accounts 1810 1,827 2 1,392 1,177 3,642 3,516 9,220 8,691 29,466 26,246

Recov erable unauthorised, irregular, fruitless and w asteful ex penditure 1820 – – – – – – – – – –

Other 1900 3,941 125 1,125 1,239 1,388 1,293 3,146 3,666 15,922 10,731

Total By Income Source 2000 146,190 571 50,811 38,587 24,932 23,309 62,054 61,121 407,574 210,002 – –

2017/18 - totals only – –

Debtors Age Analysis By Customer Group

Organs of State 2200 23,703 70 15,228 13,681 5,619 4,952 22,467 41,289 127,009 88,008

Commercial 2300 38,993 24 8,623 8,853 5,194 4,893 10,565 7,086 84,232 36,592

Households 2400 82,898 473 26,566 15,576 13,789 13,208 28,546 12,678 193,735 83,798

Other 2500 597 4 394 476 329 256 475 68 2,598 1,604

Total By Customer Group 2600 146,190 571 50,811 38,587 24,932 23,309 62,054 61,121 407,574 210,002 – –

MP326 City of Mbombela - Supporting Table SC3 Monthly Budget Statement - aged debtors - M03 September

Budget Year 2018/19

2.1.1 Municipal Payment Level The average payment level (collection rate) at the end of September 2018 was standing at 82 per cent on current accounts. It under performed by 10 percent against the projected collection rate of 92 percent.

20

The tables below reflect the payment level per service as well as other sources of income.

21

22

2.1.2 Trade Payables (creditors) Analysis

Supporting table SC4 provides detail on aged creditors (payables). In terms of the MFMA all creditors are payable within 30 days of receipt of an invoice or a statement.

For the month ended 31 September 2018, aged creditors amounting to R782 million were outstanding.

Budget Year 2018/19

R thousands

Creditors Age Analysis By Customer Type

Bulk Electricity 0100 58,808 95,508 76,940 17,712 – – – – 248,967 –

Bulk Water 0200 – 146 287 1,018 5,179 938 26,884 99,750 134,203 –

PAYE deductions 0300 – – – – – – – – – –

VAT (output less input) 0400 – – – – – – – – – –

Pensions / Retirement deductions 0500 – – – – – – – – – –

Loan repay ments 0600 – 194 – – – – 22,779 – 22,973 –

Trade Creditors 0700 14,363 26,446 9,125 51,136 20,231 11,616 51,169 9,683 193,768 –

Auditor General 0800 1,024 773 – – – – 628 – 2,424 –

Other 0900 5,773 8,276 13,062 6,758 15,776 6,586 48,845 74,955 180,033 –

Total By Customer Type 1000 79,967 131,343 99,414 76,625 41,186 19,141 150,306 184,389 782,370 –

NT

Code0 -

30 Days

31 -

60 Days

Prior y ear

totals for chart

(same period)

MP326 City of Mbombela - Supporting Table SC4 Monthly Budget Statement - aged creditors - Q1 First Quarter

181 Days -

1 Year

Over 1

Year

Total61 -

90 Days

91 -

120 Days

121 -

150 Days

151 -

180 Days

Description

2.3 Investment Portfolio Analysis Supporting table SC5 below displays the Council’s investment portfolio and indicates a balance of R119 million at the end of September 2018.

Investments by maturity

Name of institution & investment ID

Period of

Investment

R thousands Yrs/Months

Municipality

NEDBANK - 037881030909/000003 Call Account Call Account 43 63 18,592 –

NEDBANK - 037881030909/000011 30 day s Fix ed Deposit 20-08-2019 – – –

NEDBANK - 037881030909/000012 60 day s Fix ed Deposit 18-09-2018 276 100,933 –

Municipality sub-total 339 119,525 – –

Entities

Entities sub-total – – – –

TOTAL INVESTMENTS AND INTEREST 2 339 119,525 – –

MP326 City of Mbombela - Supporting Table SC5 Monthly Budget Statement - investment portfolio - M03 September

Ref

Type of

Investment

Expiry date

of

investment

Market

value at end

of the

month

Accrued

interest for

the month

Yield for the

month 1

(%)

Market

value at

beginning

of the

month

Change in

market

value

23

2.4 Grant Allocation and Grant Receipts and Expenditure

Supporting tables SC6, 7(1) & 7(2) below provides details of transfers and grants received and appropriations thereof. With regards to the receipt of grants, the year-to-date actual amount received amounts to R481 million (R249 million operational grants and R232 conditional grants).

On the other hand, the year-to-date grant expenditure amounted to R266 million, R178 million expensed for operational grants and R88 million on capital grants for the period ending 30 September 2018.

2017/18 Budget Year 2018/19

Audited

Outcome

Original

Budget

Adjusted

Budget

Monthly

actual

YearTD

actual

YearTD

budget

YTD

variance

YTD

variance

Full Year

Forecast

R thousands %

RECEIPTS: 1,2

Operating Transfers and Grants

National Government: 775,754 741,061 741,061 – 249,030 185,265 63,765 34.4% 741,061

Energy Efficiency and Demand-side 9,422 – – – – – – –

Energy Efficiency and Demand-side [Schedule 5B] – – – – – – – –

Equitable Share 608,678 661,329 661,329 – 234,000 165,332 68,668 41.5% 661,329

Ex panded Public Works Programme Integrated Grant for Municipalities [Schedule 5B]5,650 8,240 8,240 – 2,060 2,060 0 0.0% 8,240

Integrated National Electrification Programme 5,132 – – – 9,500 – 9,500 –

Local Gov ernment Financial Management Grant [Schedule 5B] 3 3,400 3,470 3,470 – 3,470 867 2,603 300.0% 3,470

Municipal Demarcation and Transition Grant [Schedule 5B] 4,566 – – – – – – –

Municipal Infrastructure Grant 57,972 – – – – – – –

Municipal Infrastructure Grant [Schedule 5B] – 19,849 19,849 – – 4,962 (4,962) -100.0% 19,849

Municipal Sy stems Improv ement Grant [Schedule 5B] – – – – – – – –

Municipal Water Infrastructure Grant 3,610 – – – – – – –

Neighbourhood Dev elopment Partnership Grant 4,845 – – – – – – –

Public Transport Netw ork Grant – – – – – – – –

Public Transport Netw ork Grant [Schedule 5B] 53,885 48,173 48,173 – – 12,043 (12,043) -100.0% 48,173

Public Transport Netw ork Operations Grant [Schedule 5B] 18,593 – – – – – – –

Provincial Government: – – – – – – – –

–

Other transfers and grants [insert description] –

District Municipality: – – – – – – – –

[insert description] –

Other grant providers: 345 – – – – – – –

Municipal Demarcation Board – – – – – – – –

Unspecified 345 – – – – – – –

Total Operating Transfers and Grants 5 776,099 741,061 741,061 – 249,030 185,265 63,765 34.4% 741,061

Capital Transfers and Grants

National Government: 443,780 536,992 536,992 4,500 232,280 134,248 98,032 73.0% 536,992

Energy Efficiency and Demand-side – – – – – – – –

Energy Efficiency and Demand-side [Schedule 5B] – – – – – – – –

Integrated National Electrification Programme 26,103 31,045 31,045 – – 7,761 (7,761) -100.0% 31,045

Municipal Infrastructure Grant 283,205 317,131 317,131 – 193,848 79,283 114,565 144.5% 317,131

Municipal Infrastructure Grant [Schedule 5B] – – – – – – – –

Municipal Water Infrastructure Grant 25,663 – – – – – – –

Neighbourhood Dev elopment Partnership Grant 33,290 33,535 33,535 4,500 13,000 8,384 4,616 55.1% 33,535

Public Transport Netw ork Grant – 155,281 155,281 – 25,432 38,820 (13,388) -34.5% 155,281

Public Transport Netw ork Operations Grant [Schedule 5B] 75,518 – – – – – – –

Water Serv ices Infrastructure Grant – – – – – – – –

Provincial Government: – – – – – – – –

District Municipality: – – – – – – – –

[insert description] –

Other grant providers: – – – – – – – –

[insert description] –

Unspecified – – – – – – – –

Total Capital Transfers and Grants 5 443,780 536,992 536,992 4,500 232,280 134,248 98,032 73.0% 536,992

TOTAL RECEIPTS OF TRANSFERS & GRANTS 5 1,219,879 1,278,053 1,278,053 4,500 481,310 319,513 161,797 50.6% 1,278,053

Description Ref

MP326 City of Mbombela - Supporting Table SC6 Monthly Budget Statement - transfers and grant receipts - Q1 First Quarter

24

2017/18 Budget Year 2018/19

Audited

Outcome

Original

Budget

Adjusted

Budget

Monthly

actual

YearTD

actual

YearTD

budget

YTD

variance

YTD

variance

Full Year

Forecast

R thousands %

EXPENDITURE

Operating expenditure of Transfers and Grants

National Government: 435,119 434,852 426,515 63,554 177,631 107,251 70,380 65.6% 426,515

Energy Efficiency and Demand-side 9,422 – – – – – – –

Energy Efficiency and Demand-side [Schedule 5B] 0 6,739 6,739 – – 1,685 (1,685) -100.0% 6,739

Equitable Share 344,125 367,577 363,066 55,111 165,332 91,375 73,957 80.9% 363,066

Ex panded Public Works Programme Integrated Grant for Municipalities [Schedule 5B]5,513 1,920 1,920 1,039 2,673 480 2,193 457.0% 1,920

Integrated National Electrification Programme – – – – – – – –

Local Gov ernment Financial Management Grant [Schedule 5B] 3,400 2,874 2,874 90 319 718 (399) -55.6% 2,874

Municipal Demarcation and Transition Grant [Schedule 5B] 3,980 7,613 3,786 – – 960 (960) -100.0% 3,786

Municipal Infrastructure Grant 14,794 10,130 10,130 – – 2,533 (2,533) -100.0% 10,130

Public Transport Netw ork Grant [Schedule 5B] 53,885 38,000 38,000 7,314 9,306 9,500 (194) -2.0% 38,000

Provincial Government: – – – – – – – –

–

District Municipality: – – – – – – – –

–

Other grant providers: – – 1,055 – – 106 (106) -100.0% 1,055

Municipal Demarcation Board – – – – – – – –

Unspecified – – 1,055 – – 106 (106) -100.0% 1,055

Total operating expenditure of Transfers and Grants: 435,119 434,852 427,570 63,554 177,631 107,356 70,275 65.5% 427,570

Capital expenditure of Transfers and Grants

National Government: 4,636 536,992 605,068 25,739 78,493 147,345 (68,852) -46.7% 605,068

Integrated National Electrification Programme – 31,045 31,045 3,505 4,378 7,761 (3,383) -43.6% 31,045

Municipal Infrastructure Grant 10,839 317,131 317,131 19,964 53,475 80,003 (26,527) -33.2% 317,131

Municipal Water Infrastructure Grant 494 – – – – – – –

Neighbourhood Dev elopment Partnership Grant (6,697) 33,535 33,535 150 18,520 8,384 10,136 120.9% 33,535

Public Transport Netw ork Grant – 155,281 223,357 2,120 2,120 51,198 (49,078) -95.9% 223,357

Water Serv ices Infrastructure Grant – – – – – – – –

Provincial Government: – – – – – – – –

–

District Municipality: – – – – – – – –

–

Other grant providers: – – – – – – – –

Dev elopers Contribution – – – – – – – –

Total capital expenditure of Transfers and Grants 4,636 536,992 605,068 25,739 78,493 147,345 (68,852) -46.7% 605,068

TOTAL EXPENDITURE OF TRANSFERS AND GRANTS 439,755 971,844 1,032,638 89,293 256,124 254,702 1,423 0.6% 1,032,638

Description Ref

MP326 City of Mbombela - Supporting Table SC7(1) Monthly Budget Statement - transfers and grant expenditure - Q1 First Quarter

25

2.5 Councillor Allowances and Employee Benefits

Table (SC8) below provides the detail for councillor and employee benefits. The year to date actual expenditure for salaries, allowances and benefits paid amounts to R229 million for the period ending 30 September 2018.

2017/18 Budget Year 2018/19

Audited

Outcome

Original

Budget

Adjusted

Budget

Monthly

actual

YearTD

actual

YearTD

budgetYTD variance YTD variance

Full Year

Forecast

R thousands %

1 A B C D

Councillors (Political Office Bearers plus Other)

Basic Salaries and Wages 22,939 25,735 25,735 1,855 5,650 6,434 (784) -12% 25,735

Pension and UIF Contributions 2,860 3,052 3,052 225 692 763 (71) -9% 3,052

Medical Aid Contributions 612 653 653 53 158 163 (6) -4% 653

Motor Vehicle Allow ance 8,143 9,607 9,607 685 2,081 2,402 (321) -13% 9,607

Cellphone Allow ance 3,850 2,619 2,619 312 951 655 296 45% 2,619

Housing Allow ances –

Other benefits and allow ances 17 30 30 2 6 7 (1) -15% 30

Sub Total - Councillors 38,422 41,696 41,696 3,131 9,538 10,424 (886) -8% 41,696

% increase 4 8.5% 8.5% 8.5%

Senior Managers of the Municipality 3

Basic Salaries and Wages 13,436 31,316 31,316 1,130 3,179 7,829 (4,650) -59% 31,316

Pension and UIF Contributions 472 624 624 21 61 156 (94) -61% 624

Medical Aid Contributions 196 217 217 15 44 54 (10) -18% 217

Ov ertime –

Performance Bonus –

Motor Vehicle Allow ance 3,020 3,529 3,529 226 637 882 (245) -28% 3,529

Cellphone Allow ance 411 488 488 29 81 122 (41) -33% 488

Housing Allow ances –

Other benefits and allow ances 250 51 51 0 0 13 (13) -100% 51

Pay ments in lieu of leav e 814 – – – – – – –

Long serv ice aw ards –

Post-retirement benefit obligations 2 –

Sub Total - Senior Managers of Municipality 18,599 36,225 36,225 1,421 4,003 9,056 (5,053) -56% 36,225

% increase 4 94.8% 94.8% 94.8%

Other Municipal Staff

Basic Salaries and Wages 413,822 474,898 474,898 53,587 135,604 118,724 16,880 14% 474,898

Pension and UIF Contributions 87,370 104,221 104,221 8,110 24,250 26,055 (1,806) -7% 104,221

Medical Aid Contributions 37,724 47,707 47,707 3,273 9,772 11,927 (2,155) -18% 47,707

Ov ertime 92,145 102,654 102,654 8,526 24,039 25,663 (1,625) -6% 102,654

Performance Bonus 34,328 27,689 27,689 2,933 10,232 6,922 3,309 48% 27,689

Motor Vehicle Allow ance 39,991 50,232 50,232 3,758 11,069 12,558 (1,489) -12% 50,232

Cellphone Allow ance 4,397 5,451 5,451 402 1,196 1,363 (167) -12% 5,451

Housing Allow ances 3,331 4,044 4,044 301 896 1,011 (115) -11% 4,044

Other benefits and allow ances 28,082 34,642 34,642 2,593 7,465 8,660 (1,195) -14% 34,642

Pay ments in lieu of leav e 5,437 – – – 309 – 309 #DIV/0! –

Long serv ice aw ards –

Post-retirement benefit obligations 2 31,670 – – – – – – –

Sub Total - Other Municipal Staff 778,296 851,537 851,537 83,482 224,831 212,884 11,947 6% 851,537

% increase 4 9.4% 9.4% 9.4%

Total Parent Municipality 835,317 929,458 929,458 88,034 238,373 232,365 6,008 3% 929,458

TOTAL SALARY, ALLOWANCES & BENEFITS

835,317 929,458 929,458 88,034 238,373 232,365 6,008 3% 929,458

% increase 4 11.3% 11.3% 11.3%

TOTAL MANAGERS AND STAFF 796,895 887,762 887,762 84,903 228,834 221,940 6,894 3% 887,762

MP326 City of Mbombela - Supporting Table SC8 Monthly Budget Statement - councillor and staff benefits - M03 September

Summary of Employee and Councillor remuneration Ref

26

2.6 Actual Cash Receipts and Payments Analysis

The actual cash receipts for the month of September 2018 amounted to R136 million, while cash payments made during the month amounted to R185 million resulting in cash and cash equivalent of R127 million

Table SC9 below provides details of the cash-flows: MP326 City of Mbombela - Supporting Table SC9 Monthly Budget Statement - actuals and revised targets for cash receipts - M03 September

July August Sept October Nov Dec January Feb March April May June

R thousands 1 Outcome Outcome Outcome Budget Budget Budget Budget Budget Budget Budget Budget Budget

Cash Receipts By Source

Property rates 46,700 42,780 36,225 428,623 554,329 582,588 626,865

Serv ice charges - electricity rev enue 52,530 65,029 70,575 681,129 869,263 927,529 978,543

Serv ice charges - w ater rev enue 4,174 5,629 3,611 76,523 89,937 92,935 98,046

Serv ice charges - sanitation rev enue 1,249 1,439 1,711 21,981 26,381 27,260 28,759

Serv ice charges - refuse 5,383 6,254 5,552 81,473 98,662 101,951 107,558

Serv ice charges - other 339 329 438 (1,107) – – –

Rental of facilities and equipment 107 92 83 11,396 11,679 12,068 12,732

Interest earned - ex ternal inv estments 1,058 1,052 339 (847) 1,601 1,688 1,780

Interest earned - outstanding debtors – – – 26,550 26,550 29,205 32,126

Div idends receiv ed – – – – – – –

Fines, penalties and forfeits 634 400 552 6,108 7,694 8,109 8,555

Licences and permits 18,523 15,859 14,708 (49,090) – – –

Agency serv ices 806 690 640 196,008 198,143 208,843 220,329

Transfer receipts - operating 234,975 – – 506,086 741,061 795,372 873,066

Other rev enue 1,076 1,097 1,217 24,624 28,015 10,373 12,257

Cash Receipts by Source 367,556 140,650 135,651 – – – – – – – – 2,009,456 2,653,314 2,797,921 3,000,618 –

Other Cash Flows by Source –

Transfer receipts - capital 1,076 917 803 519,141 521,937 495,937 566,563

Contributions & Contributed assets – – – – – – –

Proceeds on disposal of PPE – – – – – 2,106 –

Short term loans – – – – – – –

Borrow ing long term/refinancing – – – – – – –

Increase in consumer deposits – – – – – – –

Receipt of non-current debtors – – – 15,000 15,000 – –

Receipt of non-current receiv ables – – – – – – –

Change in non-current inv estments – – – – – – –

Total Cash Receipts by Source 368,632 141,567 136,455 – – – – – – – – 2,543,597 3,190,251 3,295,964 3,567,181 –

Cash Payments by Type –

Employ ee related costs 67,191 76,771 84,917 644,627 873,505 922,599 982,543

Remuneration of councillors 3,201 3,201 3,129 32,164 41,696 43,948 46,365

Interest paid – 1 37,164 37,165 33,532 24,153

Bulk purchases - Electricity 129,992 893 16,844 538,491 686,220 741,117 800,407

Bulk purchases - Water & Sew er 11 – – 49,957 49,968 53,465 57,262

Other materials 62 1,097 762 53,580 55,501 58,498 61,716

Contracted serv ices 6,897 26,064 30,608 426,008 489,577 452,011 440,237

Grants and subsidies paid - other municipalities – – – – – – –

Grants and subsidies paid - other 926 2,062 3,542 28,740 35,270 37,174 39,219

General ex penses 1,452 5,621 9,119 302,450 318,641 422,169 517,026

Cash Payments by Type 209,731 115,710 148,921 – – – – – – – – 2,113,181 2,587,542 2,764,514 2,968,927 –

Other Cash Flows/Payments by Type

Capital assets 32,780 37,305 17,916 511,890 599,891 546,217 585,523

Repay ment of borrow ing 31,046 – 18,592 (22,391) 27,247 29,302 17,515

Other Cash Flow s/Pay ments – – – 2,864 2,864 3,016 3,176

Total Cash Payments by Type 273,557 153,015 185,429 – – – – – – – – 2,605,544 3,217,544 3,343,049 3,575,140 –

NET INCREASE/(DECREASE) IN CASH HELD 95,075 (11,448) (48,974) – – – – – – – – (61,947) (27,293) (47,085) (7,960)

Cash/cash equiv alents at the month/y ear beginning: 92,887 187,962 176,514 127,540 127,540 127,540 127,540 127,540 127,540 127,540 127,540 127,540 92,887 65,594 18,509

Cash/cash equiv alents at the month/y ear end: 187,962 176,514 127,540 127,540 127,540 127,540 127,540 127,540 127,540 127,540 127,540 65,594 65,594 18,509 10,549

Budget Year

+1 2019/20

Budget Year

+2 2020/21

Description

Budget Year

2018/19

RefBudget Year 2018/19

2018/19 Medium Term Revenue &

Expenditure Framework

27

2.7 Capital Programme Performance

Supporting table SC12 below provides information on the monthly trends for capital expenditure. R27 million capital expenditure was recorded for the month of September 2018. The average capital budget expenditure performance per month for the past three amounted to R30 million.

2017/18

Audited

Outcome

Original

Budget

Adjusted

Budget

Monthly

actual

YearTD

actual

YearTD

budget

YTD

variance

YTD

variance

% spend of

Original

Budget

R thousands %

Monthly expenditure performance trend

July – 52,549 54,116 29,974 29,974 54,116 24,142 44.6% 5%

August 2,997 52,549 61,881 30,442 60,417 115,997 55,580 47.9% 10%

September 10,097 52,549 61,301 26,974 87,390 177,297 89,907 50.7% 14%

October 46,138 52,549 61,301 – 238,598 –

Nov ember 24,144 52,549 61,301 – 299,899 –

December 18,812 52,549 61,301 – 361,199 –

January 33,335 52,549 61,301 – 422,500 –

February 31,961 52,549 61,301 – 483,801 –

March 54,750 52,549 61,301 – 545,101 –

April 33,418 52,549 61,301 – 606,402 –

May 45,823 52,549 61,301 – 667,703 –

June 125,650 52,549 61,301 – 729,003 –

Total Capital expenditure 427,123 630,592 729,003 87,390

Month

MP326 City of Mbombela - Supporting Table SC12 Monthly Budget Statement - capital expenditure trend - M03 September

Budget Year 2018/19

Supporting tables SC13a and SC13b below provide the details for capital expenditure by asset classification for new and replacement of assets.

28

2017/18 Budget Year 2018/19

Audited

Outcome

Original

Budget

Adjusted

Budget

Monthly

actual

YearTD

actual

YearTD

budget

YTD

variance

YTD

variance

Full Year

Forecast

R thousands 1 %

Capital expenditure on new assets by Asset Class/Sub-class

Infrastructure 12,127 373,215 418,995 25,098 51,303 102,069 50,766 49.7% 418,995

Roads Infrastructure 9,988 194,129 225,374 10,714 22,821 54,177 31,356 57.9% 225,374

Roads – 156,657 182,063 9,909 22,016 42,782 20,765 48.5% 182,063

Road Structures 9,892 26,646 14,846 – – 5,481 5,481 100.0% 14,846

Road Furniture 96 10,826 28,465 805 805 5,914 5,109 86.4% 28,465

Capital Spares –

Storm w ater Infrastructure – 17,083 22,339 1,222 10,276 5,226 (5,049) -96.6% 22,339

Drainage Collection – 17,083 22,339 1,222 10,276 5,226 (5,049) -96.6% 22,339

Storm water Conveyance –

Attenuation –

Electrical Infrastructure 423 37,948 40,748 3,048 3,807 9,996 6,189 61.9% 40,748

Power Plants –

HV Substations – 4,500 5,600 – – 1,325 1,325 100.0% 5,600

HV Switching Station – 5,000 5,000 – – 1,250 1,250 100.0% 5,000

HV Transmission Conductors – 5,000 5,000 – – 1,250 1,250 100.0% 5,000

MV Substations – – – – – – – –

MV Switching Stations – – 200 – – 36 36 100.0% 200

MV Networks – – 800 – – 145 145 100.0% 800

LV Networks 423 21,448 22,148 3,048 3,807 5,489 1,682 30.6% 22,148

Capital Spares – 2,000 2,000 – – 500 500 100.0% 2,000

Water Supply Infrastructure 316 90,009 90,609 10,114 14,399 22,448 8,048 35.9% 90,609

Dams and Weirs – – – – – – – –

Boreholes – 13,000 13,000 – 1,054 3,250 2,196 67.6% 13,000

Reservoirs – 2,000 2,000 – – 500 500 100.0% 2,000

Pump Stations – – – – – – – –

Water Treatment Works – 27,940 28,640 1,518 1,518 7,112 5,594 78.7% 28,640

Bulk Mains – 13,680 13,680 – – 3,420 3,420 100.0% 13,680

Distribution – 33,139 30,039 7,166 9,919 7,721 (2,198) -28.5% 30,039

Distribution Points 316 – 3,000 1,430 1,908 382 (1,527) -399.8% 3,000

PRV Stations –

Capital Spares – 250 250 – – 62 62 100.0% 250

Sanitation Infrastructure 1,400 34,046 32,946 – – 8,511 8,511 100.0% 32,946

Pump Station 1,400 – – – – – – –

Reticulation – 22,200 22,200 – – 5,550 5,550 100.0% 22,200

Waste Water Treatment Works – – – – – – – –

Outfall Sewers – 11,846 10,746 – – 2,961 2,961 100.0% 10,746

Toilet Facilities – – – – – – – –

Capital Spares –

Solid Waste Infrastructure – – 6,479 – – 1,620 1,620 100.0% 6,479

Landfill Sites –

Waste Transfer Stations – – 6,479 – – 1,620 1,620 100.0% 6,479

Waste Processing Facilities –

Waste Drop-off Points –

Waste Separation Facilities –

Electricity Generation Facilities –

Capital Spares –

Rail Infrastructure – – – – – – – –

Rail Lines –

Rail Structures –

Rail Furniture –

Drainage Collection –

Storm water Conveyance –

Attenuation –

MV Substations –

LV Networks –

Capital Spares –

Coastal Infrastructure – – – – – – – –

Sand Pumps –

Piers –

Revetments –

Promenades –

Capital Spares –

Information and Communication Infrastructure – – 500 – – 91 91 100.0% 500

Data Centres –

Core Layers – – 500 – – 91 91 100.0% 500

Distribution Layers –

Capital Spares –

Description Ref

MP326 City of Mbombela - Supporting Table SC13a Monthly Budget Statement - capital expenditure on new assets by asset class - M03 September

29

Community Assets 231 57,113 87,086 (885) 11,451 20,309 8,858 43.6% 87,086

Community Facilities 231 57,113 87,086 (885) 11,451 20,309 8,858 43.6% 87,086

Halls – 25,750 26,650 1,881 2,333 6,601 4,268 64.7% 26,650

Centres – 7,605 7,605 520 520 1,901 1,381 72.6% 7,605

Crèches –

Clinics/Care Centres –

Fire/Ambulance Stations 26 – – – – – – –

Testing Stations –

Museums –

Galleries –

Theatres – – – – – – – –

Libraries 183 – 217 – – 39 39 100.0% 217

Cemeteries/Crematoria –

Police – – 8,521 (3,709) 8,175 2,130 (6,045) -283.8% 8,521

Purls –

Public Open Space – 1,500 1,500 422 422 375 (47) -12.7% 1,500

Nature Reserves –

Public Ablution Facilities –

Markets – 1,000 1,000 – – 250 250 100.0% 1,000

Stalls 22 3,000 3,000 – – 750 750 100.0% 3,000

Abattoirs –

Airports –

Taxi Ranks/Bus Terminals – 18,258 38,593 – – 8,262 8,262 100.0% 38,593

Capital Spares –

Sport and Recreation Facilities – – – – – – – –

Indoor Facilities – – – – – – – –

Outdoor Facilities –

Capital Spares –

Heritage assets – – – – – – – –

Monuments –

Historic Buildings –

Works of Art –

Conserv ation Areas –

Other Heritage – – – – – – – – –

Investment properties – – – – – – – –

Rev enue Generating – – – – – – – –

Improved Property –

Unimproved Property –

Non-rev enue Generating – – – – – – – –

Improved Property –

Unimproved Property –

Other assets 1,225 – 1,243 – – 288 288 100.0% 1,243

Operational Buildings 1,225 – 1,243 – – 288 288 100.0% 1,243

Municipal Offices 1,225 – 1,243 – – 288 288 100.0% 1,243

Pay/Enquiry Points –

Building Plan Offices –

Workshops –

Yards –

Stores – – – – – – – –

Laboratories –

Training Centres –

Manufacturing Plant –

Depots –

Capital Spares –

Housing – – – – – – – –

Staff Housing –

Social Housing – – – – – – – –

Capital Spares –

Biological or Cultivated Assets – – – – – – – –

Biological or Cultiv ated Assets –

Intangible Assets 1,179 – 650 – – 118 118 100.0% 650

Serv itudes –

Licences and Rights 1,179 – 650 – – 118 118 100.0% 650

Water Rights –

Effluent Licenses –

Solid Waste Licenses – – – – – – – –

Computer Software and Applications 1,179 – 650 – – 118 118 100.0% 650

Load Settlement Software Applications –

Unspecified – – – – – – – –

Computer Equipment 346 – 2,686 169 169 488 319 65.4% 2,686

Computer Equipment 346 – 2,686 169 169 488 319 65.4% 2,686

Furniture and Office Equipment 900 – 1,067 52 71 208 136 65.7% 1,067

Furniture and Office Equipment 900 – 1,067 52 71 208 136 65.7% 1,067

Machinery and Equipment 1,047 – 1,000 – 9 120 111 92.7% 1,000

Machinery and Equipment 1,047 – 1,000 – 9 120 111 92.7% 1,000

Transport Assets 5,297 1,500 2,155 – – 494 494 100.0% 2,155

Transport Assets 5,297 1,500 2,155 – – 494 494 100.0% 2,155

Land – – – – – – – –

Land – – – – – – – –

Zoo's, Marine and Non-biological Animals – – – – – – – –

Zoo's, Marine and Non-biological Animals –

Total Capital Expenditure on new assets 1 22,351 431,828 514,882 24,433 63,003 124,094 61,091 49.2% 514,882

30

2017/18 Budget Year 2018/19

Audited

Outcome

Original

Budget

Adjusted

Budget

Monthly

actual

YearTD

actual

YearTD

budget

YTD

variance

YTD

variance

Full Year

Forecast

R thousands 1 %

Capital expenditure on renewal of existing assets by Asset Class/Sub-class

Infrastructure 178 41,246 41,246 – – 10,311 10,311 100.0% 41,246

Roads Infrastructure – 16,017 16,017 – – 4,004 4,004 100.0% 16,017

Roads – 12,863 12,863 – – 3,216 3,216 100.0% 12,863

Road Structures –

Road Furniture –

Capital Spares – 3,154 3,154 – – 788 788 100.0% 3,154

Storm w ater Infrastructure – – – – – – – –

Drainage Collection – – – – – – – –

Storm water Conveyance –

Attenuation –

Electrical Infrastructure – – – – – – – –

Power Plants –

HV Substations –

HV Switching Station –

HV Transmission Conductors –

MV Substations –

MV Switching Stations –

MV Networks –

LV Networks – – – – – – – –

Capital Spares –

Water Supply Infrastructure 178 – – – – – – –

Dams and Weirs –

Boreholes –

Reservoirs – – – – – – – –

Pump Stations –

Water Treatment Works – – – – – – – –

Bulk Mains –

Distribution 178 – – – – – – –

Distribution Points –

PRV Stations –

Capital Spares – – – – – – – –

Sanitation Infrastructure – – – – – – – –

Pump Station – – – – – – – –

Reticulation – – – – – – – –

Waste Water Treatment Works – – – – – – – –

Outfall Sewers – – – – – – – –

Toilet Facilities –

Capital Spares –

Solid Waste Infrastructure – – – – – – – –

Landfill Sites – – – – – – – –

Waste Transfer Stations –

Waste Processing Facilities –

Waste Drop-off Points –

Waste Separation Facilities –

Electricity Generation Facilities –

Capital Spares –

Rail Infrastructure – 11,826 11,826 – – 2,956 2,956 100.0% 11,826

Rail Lines –

Rail Structures – 11,826 11,826 – – 2,956 2,956 100.0% 11,826

Rail Furniture –

Drainage Collection –

Storm water Conveyance –

Attenuation –

MV Substations –

LV Networks –

Capital Spares –

Coastal Infrastructure – 11,038 11,038 – – 2,759 2,759 100.0% 11,038

Sand Pumps –

Piers –

Revetments –

Promenades –

Capital Spares – 11,038 11,038 – – 2,759 2,759 100.0% 11,038

Information and Communication Infrastructure – 2,365 2,365 – – 591 591 100.0% 2,365

Data Centres –

Core Layers –

Distribution Layers –

Capital Spares – 2,365 2,365 – – 591 591 100.0% 2,365

MP326 City of Mbombela - Supporting Table SC13b Monthly Budget Statement - capital expenditure on renewal of existing assets by asset class -

Description Ref

31

Community Assets – 400 400 – – 100 100 100.0% 400

Community Facilities – – – – – – – –

Halls – – – – – – – –

Centres –

Crèches –

Clinics/Care Centres –

Fire/Ambulance Stations –

Testing Stations –

Museums –

Galleries –

Theatres –

Libraries –

Cemeteries/Crematoria –

Police –

Purls –

Public Open Space –

Nature Reserves –

Public Ablution Facilities –

Markets –

Stalls –

Abattoirs –

Airports –

Taxi Ranks/Bus Terminals –

Capital Spares –

Sport and Recreation Facilities – 400 400 – – 100 100 100.0% 400

Indoor Facilities – 400 400 – – 100 100 100.0% 400

Outdoor Facilities –

Capital Spares –

Heritage assets – – – – – – – –

Monuments –

Historic Buildings –

Works of Art –

Conserv ation Areas –

Other Heritage – – – – – – – – –

Investment properties – – – – – – – –

Rev enue Generating – – – – – – – –

Improved Property –

Unimproved Property –

Non-rev enue Generating – – – – – – – –

Improved Property –

Unimproved Property –

Other assets – 4,750 4,750 – – 1,187 1,187 100.0% 4,750

Operational Buildings – 4,750 4,750 – – 1,187 1,187 100.0% 4,750

Municipal Offices –

Pay/Enquiry Points –

Building Plan Offices –

Workshops –

Yards –

Stores –

Laboratories –

Training Centres – 750 750 – – 188 188 100.0% 750

Manufacturing Plant –

Depots – 4,000 4,000 – – 1,000 1,000 100.0% 4,000

Capital Spares –

Housing – – – – – – – –

Staff Housing –

Social Housing –

Capital Spares –

Biological or Cultivated Assets – – – – – – – –

Biological or Cultiv ated Assets –

Intangible Assets – – – – – – – –

Serv itudes –

Licences and Rights – – – – – – – –

Water Rights –

Effluent Licenses –

Solid Waste Licenses –

Computer Software and Applications –

Load Settlement Software Applications –

Unspecified –

Computer Equipment – – – – – – – –

Computer Equipment –

Furniture and Office Equipment – – – – – – – –

Furniture and Office Equipment – – – – – – – –

Machinery and Equipment – – – – – – – –

Machinery and Equipment –

Transport Assets – – – – – – – –

Transport Assets –

Land – – – – – – – –

Land –

.Zoo's, Marine and Non-biological Animals – – – – – – – –

Zoo's, Marine and Non-biological Animals –

Total Capital Expenditure on renewal of existing assets 1 178 46,396 46,396 – – 11,599 11,599 100.0% 46,396

32