mjindi farming ar print · n.dip, b-tech (civil) senior engineer mr mm sifundza chief executi ve...

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ANNUAL REPORT2 0 1 7 - 2 0 1 8

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ANNUAL REPORT FOR THE PERIOD 1 APRIL 2017 TO 31 MARCH 2018

This Annual Report of Mjindi Farming (Pty) Ltd describes and details the acti viti es of the enti ty for the period from 1 April 2017 TO 31 March 2018.

This report has been prepared for submission to the Executi ve Authority and the Parliament of South Africa in line with the requirements of the Public Finance Management Act (No 1 of 1999).

CONTACT DETAILS

MJINDI FARMING (PTY) LTDPO Box 29 JOZINI 3969

MAKHATHINI FLATS, 3969

TEL:035 572 9015/20Fax: 035 572 9023

Email: [email protected]

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CONTENTSPART AGENERAL INFORMATION

PART BPERFORMANCE INFORMATION

PART CCORPORATE GOVERNANCE

PART DANNUAL FINANCIAL STATEMENTS

PART EHUMAN RESOURCE MANAGEMENT


PART AGENERAL INFORMATION


REGISTERED NAME:MJINDI FARMING (PTY) LTD

REGISTRATION NUMBER (if applicable): 1993/007159/07

PHYSICAL ADDRESS:SECTION 2 OFFICESMAKHATHINI FLATS

JOZINI3969

POSTAL ADDRESS: P. O. BOX 29

JOZINI3969

TELEPHONE NUMBER/S:35 572 9015/20

FAX NUMBER: 035 572 9023

EMAIL ADDRESS: [email protected]

WEBSITE ADDRESS:www.mjindifarming.co.za

EXTERNAL AUDITORS:OFFICE OF THE AUDITOR GENERAL SA

BANKERS:

FIRST NATIONAL BANK

COMPANY/ BOARD SECRETARY

C & H ACCOUNTING INCORPORATED

GENERAL INFORMATION


VISION, MISSION AND VALUESVISION

MISSION

VALUES

MANDATE

Mjindi Farming Pty (Ltd) aims at becoming an internati onally recognized thriving farmer-driven and socially relevant enti ty driving sustainable and green agricultural producti on.

To develop and sustain the agricultural potenti al, supply eff ecti ve farmer support services and maximise agri-business development for the benefi t of the farmers and communiti es of Makhathini in partnership with stakeholders.

Mjindi Farming (Pty) Ltd commits itself to the promoti on of the following values in all its programmes and acti viti es:

• Integrity – we commit to ethical and moral conduct that promotes honesty at all ti mes.

• Respect – we will treat stakeholders with courtesy and acknowledge and value their rights and those of the environment.

• Accountability – we involve stakeholders in the organizati on’s acti viti es with a culture of openness whilst we remain answerable for the outcome of our acti ons and acti viti es.

• Team Work – we will work together to achieve our common vision.

• Innovati on – will become an adaptable organisati on that embraces the culture of creati vity and learning.

• Excellence – we are a progressive organisati on applying best practi ces to achieve the highest quality and standards.

• Commitment – we undertake our acti viti es with passion, loyalty and dedicati on at all ti mes.

• Producti vity – we undertake to produce results ti meously, effi ciently and eff ecti vely.

• Self suffi ciency – we want to promote self-suffi ciency in our programmes to empower our clients to be more independent and entrepreneurial.

• Batho Pele Principles - we remain committ ed to upholding the values and principles of Batho Pele as a public enti ty.

Mjindi Farming Pty Ltd has the following specifi c mandate:

• Repair and upgrading of the existi ng 3 500 ha currently under irrigati on;

• To sustain the Makhathini Irrigati on Scheme as a viable and sustainable farmer sett lement project;

• To transform Mjindi Farming (Pty) Ltd into a land user/landowner/farmer drive enti ty;

• To assist with the planned and approved expansion of the irrigati on scheme (area in total aimed for is 15 000 ha) for the sett lement of additi onal farmers;

• To assist and support the shareholder with the planning and implementati on of the Makhathini Integrated Master Development Plan;

• Explore and facilitates new agri-business opportuniti es on the irrigati on scheme.


OUR VALUE STATEMENT

In fulfi lling its mission Mjindi Farming Pty (Ltd) is committ ed in upholding the following values and their meaning:

INTERGRITY RESPECT

We commit to ethical and moral conduct that promotes honesty at all ti mes.

We treat stakeholders with courtesy and acknowledge and value their rights and those of the environment.

ACCOUNTABILITY TEAM WORK

We involve stakeholders in the organizati on’s acti viti es with a culture of openness whilst we remain answerable for the outcome of our acti ons and acti viti es.

We work together to achieve our common vision

INNOVATION EXCELLENCE

Mjindi Farming will become an adaptable organisati on that embraces the culture of creati vity and learning

Mjindi Farming is a progressive organisati on that applies best practi ces to achieve the highest quality and stan-dards

COMMITMENT PRODUCTIVITY

New undertake our acti viti es with passion, loyalty and dedicati on at all ti mes

We undertake to produce results ti meously, effi ciently and eff ecti vely.

SELF SUFFICIENCY BATHO-PELE PRINCIPLES

We want to promote self-suffi ciency in our programmes to empower our clients to be more independent and entrepreneurial.

We remain committ ed to upholding the values and prin-ciples of Batho Pele as a public enti ty.


ORGANISATIONAL STRUCTURE

Accounti ng Authority/Board

Chief Executi ve Offi cer

Chief Financial Offi cer

Senior Manager - Farmer

Development and Support Services

Senior Manager - Infrastructure and

Water Services

Senior Manager - Agri business

developer


BOARD OF DIRECTORS

DR M.S MBATHA (CHAIRPERSON)

MR R.V NHLEBELA(MEMBER)

MR M.D MYENI(MEMBER)

MR W.R DLADLA (DEPUTY CHAIRPERSON)

- Post-Doctoral (under Programme of Poverty, the Underclass and Public Policy)- Phd in Social Welfare Policy- Masters of City Planning- Masters of Social Sciences (Alienati on Among African Elderly In Mpumalanga Township)- Ba Honours in Social Work - Ba in Social Work (Social Work And Psychology)

- Masters in Business Administrati on (in progress)- Project Management- Masters in Science (Physics)- Bsc Honours in Physics - Bsc (Mathemati cs and Physics)

- Diploma in Structural- N6 Certi fi cate- Certi fi cate for Supply Chain Management Practi ti oner Training- Finance for Non-Finance Managers Certi fi cate- Safety Associati on Certi fi cate- Constructi on and Project Management Certi fi cate- Understanding Financial Statements Certi fi cate

- Masters Degree in Agricultural Economics- Honours Bachelor of Agricultural Economics- Bachelor of Agriculture- Diploma in Agriculture- Certi fi cate in Sheep Handling- Senior Certi fi cate in Sugar Cane Producti on- Higher Educati on Diploma- Certi fi cate in Spiritual Leadership


MR S.F MYENI(MEMBER)

MRS B.K NDIMANDE(MEMBER)

MR J. MLAMBO(MEMBER)

MR B.S.G ZONDI(MEMBER)

- Grade 9- Marketi ng and Processing- Business Management- Farmer

- Computer Studies - Post Graduate Diploma in Business Management- Bcom Specialising In Logisti cs- Diploma in Project Management- Nati onal Diploma in Mechanical Engineering

- Matric Certi fi cate- Client Service Certi fi cate- Sales and Marketi ng Certi fi cate- Corporate Governmen and Board Eff ecti veness- Farmer


ACCOUNTING AUTHORITYThe Accounti ng Authority is the focal point of corporate governance in the organisati on, and is ulti mately accountable and responsible for the performance and aff airs of Mjindi Farming (Pty) Ltd. The Accounti ng Authority is responsible for enforcing adequate and eff ecti ve corporate governance standards applicable to the operati ons and functi ons of Mjindi Farming (Pty) Ltd.

The Accounti ng Authority compositi on opti mises the business, professional and management abiliti es as well as expe-rience in a way that adds value to Mjindi Farming (Pty) Ltd and in parti cular the farming and irrigati on acti viti es.

Mr ME ThekisoActi ng Chief Executi ve Offi cer

N.Dip, B-Tech (Civil) Senior Engineer

Mr MM SifundzaChief Executi ve Offi cer

Dip (Agric), BSC (Agric), MSc (Agric Economics)

Mrs S NgidiChief Financial Offi cer

CTA; BCompt; Honours; Acc. Sc; Post Grad: Acc. Sc; Post Grad: Finance, Banking and Investment Management, Member of the

Insti tute of Acc & Commerce

Mr W TomSenior Manager – Farmer Development Support Services

MSc degree in Agriculture (Crop Science)BSc degree in Agriculture (Management)

EXECUTIVE MANAGEMENT

Date Appointed: 01 August 2011Areas of Experti se• Roads• Sanitati on and water related projects• Constructi on• Infrastructure• Water engineering

Date Appointed: 15 November 2010Areas of Experti se• Policy Development, Implementati on, Monitoring and Evaluati on• Financing and Investment Management• Audit and Risk Management• Financial Management and Reporti ng• Taxati on

Date Appointed: 01 August 2011Areas of Experti se• Crop Producti on Management• Agricultural business management• Agricultural Extension management• Applied soil science• Horti culture• Farm management.

Date Appointed: 01 March 2011 ti ll 30 October 2017Areas of Experti se• Financial Management• Enterprise Development• Organisati onal Development• Rural Resource Management• Agribusiness Finance and Management• Farming• Training and Development


FOREWORD BY THE MEC

Mr RT MthembuMEC : KZN Agriculture and Rural Development

On behalf of the Department of Agriculture and Rural Development in KZN, It is with great honour and appreciati on to present the Annual Report for Mjindi Farming (Pty) Ltd for the fi nancial year ended on the 31st March 2018.

Mjindi Farming (Pty) Ltd played a criti cal role in improving the performance of our economy in the year under review. The enti ty’s role made a signifi cant contributi on to the Gross Domesti c Product (GDP) parti cularly in Makhathini area in the northern part of KZN.

Which is why I have extended the term of interim board of Mjindi Farming (Pty) Ltd to ensure that the enti ty fulfi ls its mandate of maintaining the irrigati on infrastructure of the scheme, supplying services and extension support to farm-ers and also to parti cipate in the process of winding up the enti ty. With the new strategy we hope to transform the irrigati on scheme to a more viable commercial business which will unlock business potenti al, create sustainable jobs, create wealth, establish a vibrant local economy which in turn will assist government to eradicate poverty and improve food security. The scheme has so far supported over 150 vegetable farmers while over 300 farmers were trained in various techniques of farming.

With all the successes achieved in spite of the challenges of aged infrastructure, one can only look forward to the ad-vanced stage of the development of the new enti ty which will fi nally unlock the fortunes of the Makhathini area with more determinati on and vigour.

The successes of Mjindi Farming (Pty) Ltd in the year under review as tabled in this year report are truly an indicati on of the commitment shown by Mjindi Farming employees during this uncertain ti me to facilitate uninterrupted service delivery to the people. Mjindi Farming together with Department of Agriculture will conti nue to promote the commer-cialisati on of farming operati on to ensure an increase and reliable producti on within the irrigati on scheme.

Many farmers are starti ng to realise the potenti al of the Makhathini area and opportuniti es which may be at their forefront. Farmer’s parti cipati on in developing a turnaround strategy will be a necessary step towards a greater future. However, land dispute remains challenge which will require rati onal leadership from traditi onal leaders in the area. Perhaps a decisive acti on to realise the enormous economic potenti al of agriculture will assist.

As we advance forward let us conti nue with the same desire, purpose and moti vati on to see agriculture in our province transformed, making it economically sustainable for the benefi t of poor communiti es who rely on eff ecti ve and effi -cient services and support to prosper.

_________________________________

Mr RT MthembuMember of the Executi ve Committ ee (MEC)

_________________________________


STATEMENT BY THE CHAIRPERSON

Mjindi Farming (PTY) LTD facilitates agricultural development in the areas serviced by the Makhathini Irrigati on Scheme. The producti on focus is on fi eld crops, vegetables and fruits. The Makhathini area has a high agricultural potenti al that needs to be exploited in order to benefi t the local community thereby enhancing the economy of the province and the country as whole.

Currently the scheme focuses on primary agriculture (i.e. producti on of fi eld crops, vegetables and fruits) with a view to moving into agroprocessing once producti on reaches required levels.

Mjindi Farming conti nues to support farmers through the provision of technical agricultural support; water supply and infrastructural maintenance. Despite the commitment and the dedicati on of the staff and the farmers the dilapidated infrastructure, parti cularly the canal and the underground pipes, undermines the realizati on of high yields and produc-ti on. The farming operati ons are conti nually aff ected by the shortages of water at criti cal ti mes. There is therefore a great need to att end to the rehabilitati on of both the canal and the underground pipes in order to realize the untapped potenti al of the area. The underground asbestos pipes have long exceeded their life expectancy and are causing serious challenges.

The concern about the sustainability of the scheme and the directi ve from the shareholder the honourable MEC T Mthembu directed the board and the management to adopt a two pronged approach in the workings of the year 2017/2018 that are conti nue providing the required services while at the same ti me engaging all the relevant stake-holders to investi gate the strategies of ensuring sustainability of the scheme and dealing with all the challenges of the scheme. The organizati on has worked ti relessly in reviewing the history of the scheme and identi fying the challenges that make the scheme not to be sustainable despite the huge investment by the government. The outcome of this en-gagement with the stakeholders has revealed a number of things that need to be done in order to make the scheme a self-sustainable irrigati on scheme. A draft Turnaround strategy document has been developed which point out where we come from; we are and we have to be in few years in order to achieve the full sustainability of the scheme. The whole sustainability strategy is based on commercializati on of the farming operati ons with major insti tuti onal and infrastructural improvements.

The draft Turnaround strategy is aimed at ensuring that the whole farming operati on enhances self reliance among farmers thereby reducing their dependency on government subsidies. To enhance the sustainability of the scheme there is a need to prioriti se the revamping of the irrigati on infrastructure and to also improve the insti tuti onal arrange-ments

The realizati on of the economic benefi ts of Makhathini requires that all the stakeholders (government departments, traditi onal leadership, land owners, farmers, private investors and local government) share a coordinated and common vision of the organizati on to be an internati onally recognized thriving farmer-driven and socially relevant enti ty driving sustainable and green agricultural producti on.

Working through the fi ve committ ees that are Farmer development, Infrastructure, Finance and HR; Audit and Risk the board managed to hold regular meeti ngs. In collaborati on with stakeholders and managing the volati le relati onships

MR W.R DLADLA (DEPUTY CHAIRPERSON)


between some of the stakeholders we managed to collect relevant informati on that led to the compilati on of the draft turnaround strategy.

In the foreseeable future we plan to hold consultati ons with all relevant stakeholders presenti ng the draft turnaround strategy. The purpose of the consultati on will be to seek endorsement and capture any other additi onal informati on that will improve the strategy. Once all the stakeholders have been consulted and the document has been improved it will then be presented to the shareholder for its approval and adopti on. Hopefully this process will be completed before the amalgamati on of the enti ty with the other two enti ti es which are Agribusiness Development Agency and Inti ngwe Tea Estate due to rati onalizati on process which is currently taking place.

First and foremost I would like to sincerely thank my colleagues, the board members, the audit committ ee, the man-agement and the staff as whole for the role played in executi ng the tasks of the enti ty.

On behalf of the Mjindi Board of Directors and staff , I would also like to express my grati tude to:

- The Shareholder, the Member of the Executi ve Council, Honorable R. T Mthembu for his leadership, guidance and support.

- C & H Accounti ng for the accounti ng services rendered during the year under review.

- The Traditi onal leadership of Gumede and Myeni Tribes, the Ntenga and the Silwane Trusts and farmers, who are the only reason why Mjindi exists.

_________________________

Mr W.R Dladla

Deputy Chairperson

only reason why Mjindi exists.

_________________________

Mr W.R Dladla


OVERVIEW OF THE ACCOUNTING OFFICER

INTRODUCTION

The 2017/18 fi nancial year proved a remarkable and exciti ng period for Makhathini community and Mjindi Farming, the organizati on that facilitates agricultural development in the Makhathini Irrigati on Scheme.

Announcement was made by MEC of Department of Agriculture and Rural Development in KZN, announcing that the name Mjindi will cease to exist but all operati ons will conti nue to serve farmers in the Makhathini irrigati on scheme. The interim Board of Mjindi Farming began the year under review with the focus of starti ng the process of turning around the fortunes of Makhathini irrigati on scheme. The new strategy will transform the irrigati on scheme into a viable commercial business. The expected outcomes of the process is to unlock business potenti al, create sustainable jobs, creati on of wealth, establishment of a vibrant local economy, improved incomes, poverty reducti on and improved food security.

The year under review was not smooth sailing without challenges. The Chief Executi ve Offi cer, Mr MM Sifundza re-signed during the course of the year. His absence left the organizati on management with bigger task of maintaining and stabilizing operati ons in the enti ty during the transiti on period. However his new role as Deputy Director General (DDG) of agricultural services within the Department of Agricultural Aff airs and Rural Development in KZN may provide the necessary support required for development in Makhathini as he best understands the challenges faced in the area.

HIGHLIGHTS OF THE YEAR

During the year under review Mjindi conti nued to support local goods suppliers and created job opportuniti es. Mjin-di Farming also improved its relati ons with stakeholders through planning together and being informati ve about the developmental matt ers in the irrigati on scheme. There was improvement in the facilitati on of developing farmers of Makhathini irrigati on scheme. Over 150 vegetable farmers were supported and 302 farmers were trained in various techniques of farming. The Premier’s offi ce granted permission to Mjindi to fi ll all criti cal positi ons on a two year con-tract.

CHALLENGES

The eff ects of the previous years’ drought and fall army worm conti nue to aff ect farmers in the irrigati on scheme such that producti on levels haven’t increased drasti cally. The eff ects resulted in below target revenue collected. This year rainfall was above average where more than 700mm rain was received within a short space of ti me. The rains caused fl oods which destroyed the irrigati on infrastructure to a point where the irrigati on canal collapsed on three diff erent occasions disrupti ng the water supply to farmers’ fi elds for several weeks.

It is also important to note that the current technology in use at Makhathini pump stati ons is out dated. The upgrading of irrigati on technology is very important so that water use effi ciency improves as Makhathini is a water scarce area under the rainfall marginal areas of South Africa. There are also increased water leaks due to the aged infrastructure

Mr ME ThekisoActi ng Chief Executi ve Offi cer


and these hamper smooth operati ons of supplying pressurized water to the fi elds. The underground water network requires refurbishment as it possesses a threat to the existence of the irrigati on scheme. There is a challenge of some farmers who do not contribute positi vely to the development of irrigati on scheme.

THE YEAR AHEAD

The focus of 2018/19 period will be to facilitate the completi on the turn-around strategy which is geared at transform-ing the irrigati on scheme into a viable commercial business. Negoti ati ons with all relevant stakeholders will be held to garner support in the turn-around strategy. The land owners will be advised and guided on how the concept will operate as farmers form the integral part of the new development.

The amalgamati ons of public enti ti es will be one of major priority for the year ahead as Mjindi Farming will be parti c-ipati ng in the process. This will ensure that a Mjindi Farming or new enti ty role stays relevant to the development of Makhathini area.

Mjindi Farming will conti nue to play the key developmental role in the Makhathini community and irrigati on scheme under the extremely challenging conditi ons of the aged infrastructure. The operati on and maintenance of infrastruc-ture, farmer support and the provision of irrigati on water will remain the primary deliverables of Mjindi Farming.

WORDS OF GRATITUDE AND APPRECIATION

I would like to take this opportunity to thank the following people and organisati ons:

• The Honourable MEC, Mr RT Mthembu, for his guidance and support towards the enti ty through the year.

• The Honourable Members of the Agriculture and Rural Development Portf olio Committ ee for their support and ded-icati on to the promoti on of agriculture in the Makhathini area.

• Chairperson of Mjindi Board Dr MS Mbatha for providing strong leadership and engarengement during diffi cult ti mes.

• All the Mjindi Farming Board of Directors for believing in my leadership skills and for their dedicati on and directi on to the oversight acti viti es of Mjindi Farming (Pty) Ltd.

• The enti re management team and staff for their support and determinati on of working together and hard towards achieving set targets during the year under.

• All stakeholders of Mjindi Farming, the Ntenga Traditi onal Council, the Nsinde Traditi onal Council, Silwane Communi-ty Development Trust and Ntenga Trust for all the support and contributi ons to the development of Makhathini.

• All the farmers who have entrusted their farming business to Mjindi Farming and provided good working conditi ons to the enti re staff .

• Lastly former Chief Executi ve Offi ce Mr MM Sifundza for his profound role and contributi on to the development of Makhathini irrigati on scheme and Mjindi Farming (Pty) Ltd.

__________________________

Mr ME Thekiso

Acti ng Chief Executi ve Offi cer

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PART BPERFORMANCE INFORMATION


STATEMENT OF RESPONSIBILITY FOR PERFORMANCE INFORMATIONStatement of Responsibility for Performance Informati on for the year ended 31 March 2018

The Chief Executi ve Offi cer is responsible for the preparati on of the public enti ty’s performance informati on and for the judgments made in this informati on.

The Chief Executi ve Offi cer is responsible for establishing, and implementi ng a system of internal control designed to provide reasonable assurance as to the integrity and reliability of the performance informati on.

In my opinion, the performance informati on fairly refl ects the actual achievements against planned objecti ves, indica-tors and targets as per the strategic and annual performance plan of the public enti ty for the fi nancial year ended 31 March 2018.

Mjindi Farming performance informati on for the year ended 31 March 2018 has been examined by the external audi-tors and their report is presented on pages 20 - 44.

__________________________Mr ME ThekisoActi ng Chief Executi ve Offi cerDate:


Performance informati on by Programme

Programme 1: Administrati on and support services

Purpose:

To ensure eff ecti ve management of the enti ty’s fi nancial resources in line with statutory requirements and to provide administrati ve support services

Strategic goal:

- Sound Management of Finance

- Eff ecti ve Management of Staff

Strategic objecti ves, Performance indicators planned targets and actual achievements

Performance Indicator

Actual Achievement

2016/2017

Planned Target2017/2018

Actual Achievement

2017/2018

Deviati on from planned

target to Actual Achievement for

2017/2018

Comment on deviati ons

Reviewed and up-dated risk manage-ment plan

4 4 4 - Achieved

Amount collected as per approved MTEF budget

R5,855 R4,905 R4,657 R-248

Target not achieved due to outbreak of army worm, reproducti on of rates and interrupti on in water supplier which resulted in farmers having to replant” to “Target not achieved due to outbreak of army worm, reproducti on of rats and interrupti on in water supplier which resulted in farmers having to replant

Submit budget and Strategic planning documents & APP

3 3 3 - Achieved

Submit legislati ve fi nancial reports (AFS X 1, QPR X 4, 1 X Annual Report)

6 6 6 - Achieved



Actual Achievement

2016/2017


Actual Achievement

2017/2018



2017/2018


Total cumulati ve number of perma-nent funded post fi lled

58 70 55 15

Cost cutti ng mea-sures where the appointment have to be approved by KZN Premier

Number of signed performance agreements

60 70 55 15

Cost cutti ng mea-sures where the appointment have to be approved by KZN Premier

Training plan and Work Place Skills plan developed

2 2 2 - Achieved

Number of training interventi ons im-plemented

183 70 138 63

Target exceeded due to skills de-mand and adher-ence to legislati on

Number of stake-holders engage-ment meeti ng held

5 4 13 9

Target exceeded due to follow up meeti ngs with stakeholders.

Linking performance with budget

Programme Name

2016/2017 2017/2018

Budget Budget Expenditure Under Expenditure

Budget ActualExpenditure

Under Expenditure

R’000 R’000 R’000 R’000 R’000 R’000

Administrati on and support services

13,911 13,215 670 13,729 13,171 558

Programme 2: Farmer Development and Support Services

Purpose:

Aims: at the Provision of advisory services for opti mal land uti lisati on to increase agricultural producti vity and produc-ti on in the Makhathini irrigati on scheme.

Strategic goal:

Farmer Development, Farmer Support, Agribusiness Development, Strategic Stakeholders Relati ons and partnerships and Opti mal land management.


Strategic objecti ves, Performance indicators planned targets and actual achievements


Actual Achievement

2016/2017


Actual Achievement

2017/2018



2017/2018


Number of ha under vegetables producti on

2590.5 800 2496.19 1696.19

The presence of Uthungulu Fresh produce market and UMDA. Lima the NPO provid-ed inputs credit facility

No of cooperati ves supported

5 5 5 - Achieved

Number of vegetable farmers supported

148 150 151 1 Achieved

No of fruit farmers supported

10 10 10 - Achieved

No of farmers trained

312 300 302 2 Achieved


Programme Name

2016/2017 2017/2018

Budget Budget Actual Expenditure

(Over) / Under Expenditure

Budget ActualExpenditure

(Over) / Under Expenditure

Farmer Development and Support Services

R’000 R’000 R’000 R’000 R’000 R’000

TOTAL 27,281 25,929 1,352 22,965 22,783 182

Mjindi farming is instrumental in the agricultural operati ons of Makhathini irrigati on scheme where a varied range of crops are produced. The Farmer Development Support Services division is responsible for supporti ng farmers with the agronomic, insti tuti onal, logisti cal and marketi ng advisory services. The division bring exposure to farmers of the latest innovati ons in agriculture with the objecti ve of transforming subsistence farmers to world class producers. Farmers are encouraged to parti cipate freely and openly in trainings, demonstrati ons, informati on days and fi eld days for bett er-ment of others.

The presence of LIMA an Non-profi t organisati on providing farmers with an input credit facility promoted crop produc-ti on in the irrigati on scheme. Commercial banks are also playing a role in supporti ng farmers with fi nance although to a very limited extent.

Commercialisati on of plots in Makhathini.

Mjindi Farming conti nued to implement the Commercializati on programme with only two parti cipati ng groups which are namely, Abanguni and Qokolwane. The cooperati ves are producing mainly dry maize and certi fi ed seed sugarcane which is being sold to other farmers in the irrigati on scheme.


CABBAGE FIELD

SEEDLING TO TRANSPLANT


BANANA FRUIT TREES AS WINDBREAK ON CABBAGE FIELD

GREEN BEANS


POTATO CROP, FARMER BEING ADVISED


MAIZE CROP

TOMATO CROP UNDER DRIP IRRIGATION

M J I N D I F A R M I N G A N N U A L R E P O R T 2 0 1 7 - 2 0 1 8

TOMATO CROP UNDER DRIP IRRIGATION


MADUMBE CROP

COTTON CROP


COTTON CROP


Profi le of farmers

Mjindi Farming consistently reviewed and updated the farmer data base in compliance with policy and planning for the improvement of the provision of services to the irrigati on farmers. The data base informati on is also valuable besides planning for organising, implementi ng, monitoring and evaluati on of the overall irrigati on scheme performance. Reve-nue collecti on is made possible with the updated accurate records of farmer acti vity.

The maintenance of all irrigati on infrastructure encompassing centre pivots, hydrants, valves and pump stati ons facil-itates and promotes a business atmosphere where farmers feel confi dent to produce competi ti vely. The Makhathini irrigati on scheme is made up of 10 hectare plots amounti ng to 4,572 hectares.

SUMMARY OF MAKHATHINI IRRIGATION SCHEME BENEFICIARIES (1098)

Male Female Youth Total

Individual Farmers at Makhathini Irrigati on Scheme

206 106 22 312

Acti ve Co-operati ves at Makhathini Irrigati on scheme

195 591 93 786

Grand total 401 697 115 1098

• INDIVIDUAL FARMERS AT MAKHATHINI IRRIGATION SCHEME

• Total number of farmers: 312

• Total number of females: 106

• Total number of males: 206

• Total number of youth: 22

• ACTIVE CO-OPERATIVES IN MAKHATHINI IRRIGATION

• Summary of benefi ciaries

• Total number of cooperati ves: 10

• Total number of membership: 786

• Total number of females: 591

• Total number of males: 195

• Total number of youth: 93

Co- operati ves Male Female Youth Total

Mjindi Women Co-Operati ve 0 151 20 151

Lindokuhle Ngathi Farmers’ Co-Operati ve Limited

43 61 26 104

Ibandla Co-Operati ves 20 19 5 39

Isibonelo Co-Op 7 53 4 60

Ubuhlebesizwe Co-Op 11 61 9 72

Jabulani Co-operati ve 3 53 3 56

topazi Agricultural Co-operati ve Limited 8 2 7 10

Abanguni Farming Agricultural Co-opera-ti ve Limited

4 0 0 4

Zamukuphila Co-operati ve 10 27 1 37

Ubongwa co-operati ve 89 164 18 253

Total 195 591 93 786

• Community and livestock drawing water from the irrigati on canal.

• District municipality – 4 purifi cati on plants extracti ng water from the irrigati on canal


Awareness campaign of Fall army worm precauti onary measure

The Makhathini Farmers were made aware at meeti ngs that they must be prepared to identi fy the Fall Army Worm in the irrigati on scheme before becoming an outbreak. The farmers were taught of the signs, symptoms and the econom-ic eff ects of the Fall Army Worm att acks parti cularly in the maize crop. The farmers were also made aware of chemicals to eradicate the pest, applicati on rates, ti ming, frequency of chemical applicati on, eff ecti ve coverage, health precau-ti onary issues and methods of applicati on and costi ng per hectare.

Opportuniti es in crop producti on

Mjindi Farming conti nues to encourage and facilitate diverse farming among the Makhathini farmers. The farmers are supported not just in fi eld crops but also in fruit producti on. At present there is mango and banana producti on taking place which are succeeding due to the favourable climate, soils and good management. Farmers are also advised and encouraged to practi se crop rotati on in order to improve soil ferti lity, breakdown the disease and pest cycle as a way of risk minimisati on on crop loss.

MAIZE READY FOR MARKETING

A WELL CARED BEAN CROP


MANGO FIELD WHERE INTERCROPPING IS IN PROGRESS

Mango fruit trees fi eld

Mjindi farming also assisted by arranging the Department of Agriculture transport for farmers who bought fruit tree seedlings from Malelane, Mpumalanga to establish orchards in the irrigati on scheme. Fruits have always a ready market within and area around Makhathini area.

TOMATO READY FOR MARKET


TOMATO FIELD

A MEETING WITH FARMERS

PLANNING MEETING


INSTITUTIONAL ARRANGEMENT MEETING

LOADING CABBAGE FOR SALE

GROUP WORK PARTICIPATION


TRAINING THROUGH SHARING OF IDEAS

FARMER PLANNING MEETING

PLANNING MEETING

ON FIELD TRAINING


Farmer Capacity building

The Agricultural skills training of farmers in the irrigati on scheme plays a pivotal role in producti on of various crops. Mentoring and advisory role of Mjindi Farming has gone a mile in trying to address the transformati on of farmers from being subsistence to small scale farmers. The target of training 300 farmers was achieved in the fi nancial year 2017 / 2018. The training included all aspect of growing crop, marketi ng, demonstrati ons, planning, costi ng, choice of crop, land preparati on, planti ng, ferti lizer applicati ons, herbicides applicati ons, pest and disease control and mechanizati on considerati ons.

The farmers were exposed to the farming innovati ons on the market through the private sector involvement in the show case new products and Informati on on fi eld days held in the irrigati on scheme.

PLANNING MEETING

TRAINING


Farmers’ Informati on and fi eld Days

The informati on days conti nued as in previous years thereby aff ording Makhathini farmers the platf orm to interact and build business relati ons with scienti sts, manufacturers and marketers for assistance in fi nding soluti ons. These inter-acti ons have been gainful to some farmers who now have access to inputs credit faciliti es which improve their crop producti on levels.

INFORMATION DAY

INSTITUTIONAL AND MARKET ARRANGEMENTS MEETING


Farm producti on

Mjindi farming conti nued to encourage farmers to aim to produce crops commercially for them to realise growth in profi t margin.

Year 2017 / 18 – Total farm produce had a quanti ty of 139773 tons esti mated at gross value R162 322 707.9. Food crop total yields= 21691.4 tonnes and esti mated industrial crops total yields of 118081.6 tonnes.

TRAINING IN MOTION

BUTTERNUT READ FOR DELIVERY


CROP SURVEY ESTIMATES 2017 / 2018

Crop Total crop land size in hectares

Yield esti mate per ha in tons

Total yield in tons Esti mate price/ton (R)

Esti mate total gross income / rev-enue

Banana 34 30 1020 4500 4590000

Beans 191.05 3 573.15 3500 2006025

Brinjal 1.6 15 24 4000 96000

Butt ernut 110.45 15 1656.75 2200 3644850

Cabbages 159.8 30 4794 2400 11505600

Calabash 76.25 15 1143.75 4000 4575000

Carrot 0.5 30 15 2976 44640

Cott on (Field) 604.15 4 2416.6 5245.8 12677000.28

Green pepper 25.2 15 378 3000 1134000

Hot chillies 4.75 7 33.25 2800 93100

Madumbe 26.1 15 391.5 5040 1973160

Mangoes 35 - - 4500 -

Maize (dry) (Field) 61 8 488 2700 1317600

Maize (green) 1712.44 5 8562.2 6000 51373200

Okra 1 8 8 7500 60000

Onoins 0.2 25 5 2500 12500

Potatoes 8.5 20 170 4120 700400

Sugarcane (Field) 1393.55 83 115665 464 53668397.6

Sweet potatoes 85.25 20 1705 5400 9207000

Tomatoes 24.15 30 724.5 5030 3644235

Sum 4554.94 139773 162322707.9

Total Land Size of fruit & Vegetables: 2496.24 ha

Total Land Size of Field Crops: 2058.7 ha

Total Land Size of All Crops: 4554.94 ha

The multi plier eff ect of agriculture in Makhathini irrigati on scheme

The existence agricultural acti viti es gave birth and conti nuity to businesses such as cane cutti ng, loading and trans-portati on which are providing the much needed employment to the local community.

FRESH PRODUCE COLLECTION POINT


Programme 3: Infrastructure and Water Services

Purpose:

The infrastructure and water services program is responsible for rehabilitati ng and maintaining the

Irrigati on infrastructure in order to provide sustainable water service to farmers of Makhathini Irrigati on

Scheme.

Strategic goal:

To supply raw water when required, improve security and reduce turnaround ti me for repairs and

maintenance of infrastructure.

Strategic objecti ves, Performance indicators and targets are as follows:

Performance Indi-cator

Actual Achievement 2017/2018



Deviati on from planned target to Actual Achievement for 2017/2018


No of Km main-tained (fence)

15km 20km 26.1km 6.1km Achieved

No. of km of veg-etati on removed (vegetati on along the drainage canal, canal and fences)

241.06km 200km 211.03km 11.03km Achieved

No. of pumps , motors and control valves maintained (Pump set)

64 64 64 - Achieved

SUGARCANE TRANSPORT TO THE MILL


Performance Indi-cator




Deviati on from planned target to Actual Achievement for 2017/2018


No. of centre piv-ots maintained

10 34 15 -19

Operati ons and safe guarding of centre pivots is responsibility of farmers. Theft and vandalism of cen-tre pivots is out of control as a result a decision was taken to no longer maintain the infra-structure unless the farmer shows commitment.

No. of leaks of pipe network repaired

135 100 150 50 Achieved

No. of line valves, scour valves and air valve replaced

20 20 20 - Achieved

No of km main-tained (infi eld roads)

120.8 km 100km 103.08km 3.08km Achieved


Programme Name

2016/2017 2017/2018

Budget Actual Expen-diture

Under Expendi-ture

Budget Actual Expen-diture

Under Expendi-ture

R’000 R’000 R’000 R’000 R’000 R’000

Infrastructure and water services

19,915 17,514 2,401 22,271 18,883 3,388

Highlights:

The focus of 2017/2018 fi nancial year was on maintenance of infrastructure. Infrastructure unit provided opportuniti es to local suppliers by implementati ons small scale projects which enable Mjindi farming to achieve its operati onal set targets. These contributed on job creati on within makhathini area. Challenges of aged infrastructure conti nue to be thread to the future of Makhathini irrigati on scheme. The table above indicates achievements against the targets set for this fi nancial year.

Maintenance of fences

Theft and vandalism of fences is one of the challenges which infrastructure unit is facing in the area. There has been number of incidents were livestock was removed from irrigati on canal due to theft of fences. This resulted in shift ing focus of maintaining only fences along irrigati on and drainage canals. Canals

Secti ons of irrigati on canal are at collapsed stage and cannot keep up with weight of water. Soils supporti ng concrete lining are eroding at an alarming rate. During the raining season three major incidents occurred were irrigati on canal collapsed and resulti ng in lack of water supply to farmers for numbers of weeks. New technology has been identi fi ed


to assist with repairs and maintenance concrete canal. The implementati on of new technology will start in 2018/2019 fi nancial year.

Maintenance of pipe network

The fi rst phase of irrigati on scheme was established in 1978, with asbestos cement underground water network pipes which the majority of mainline pipes. The last development of irrigati on scheme was in 1988 with upvc underground water network pipes. Most of AC pipes are problemati c to maintenance team with number of water leaks being ex-perienced. During the year under review more than 150 cases of water leaks has been report, mainly from asbestos cement pipes. This is one of the challenges facing the irrigati on scheme and needs to be att ended urgently.

Maintenance of infi eld roads

Infrastructure unit conti nue to improve infi eld roads around the irrigati on scheme. An achievement of 103.08 km graded and compacted was reached. Farmers now have easy access to their fi elds as well as suppliers when collecti ng produce.

Maintenance of pumps, motors, and control valves

Our pump stati on technology is outdate and as result problem occurs from ti me to ti me. Maintenance team was work-ing very hard to keep up with demand of pressured water in the fi eld. A conti nuer’s maintenance in diff erent pump stati ons is under way.

Collapsed irrigati on canal.

Maintenance of transformers at pump stati on


MJINDI FARMING PROJECTS

Roof and Minor Works at Secti on 2 Offi ces and P14 Pump Stati on

Contract Value: R387 440.00 VAT inclusiveContract Period: Two (02) months Start Date: 19 July 2017Planned Completi on Date: 14 August 2017Actual Completi on Date: 08 September 2017Contractor: Brightness Networking cc

The project was awarded to Brightness Networking cc to the amount of R 387 440.00. The contract started on 19 July 2017 and was planned to be completed on 14 August 2017, the completi on date was revised to 08 September 2017 due to weather conditi on. Five hundred (500) square meters of roof and minor works was completed and created six job opportuniti es for the local people.

Infi eld Road Maintenance

Contract Value: R450 000.00 VAT inclusiveContract Period: Two (02) months and three WeeksStart Date: 13 July 2017Completi on Date: 25 September 2017Contractor: Ayakhanya Projects and Consultants (Pty) Ltd

The project was awarded to Ayakhanya Projects and Consultants (Pty) Ltd to the amount of R 450 000.00. The contract started on 13 July 2017 and was completed on 25 September 2017 (durati on of two months and three weeks. 50km of Infi eld roads were maintained and created four job opportuniti es for the local people.

Rehabilitati on and Cleaning of the Canal

Contract Value: R380 000.00 VAT inclusiveContract Period: Three (03) monthsStart Date: 19 July 2017Completi on Date: 12 October 2017Contractor: Airfl ow cc

The project was awarded to Airfl ow cc to the amount of R 380 000.00. The contract started on 19 July 2017 and was completed on 12 October 2017. Ten (10) kilometers of the water canal was maintained and created ten job opportu-niti es for the local people.

Removal of silt in the drainage canal


Clearing of Vegetati on

Contract Value: R187 640.00 VAT inclusiveContract Period: Two (02) monthsStart Date: 11 August 2017Completi on Date: 11October 2017Contractor: Bhunkula Community Projects

The project was awarded to Bhunkula Community Projects to the amount of R187 640.00. The contract started on 11 August 2017 and was completed on 11 October 2017. One hundred (100) kilometers of vegetati on was cleared and created ten job opportuniti es for the local people.

Maintenance of Fence

Contract Value: R369 000.00 VAT inclusiveContract Period: Three (03) monthsStart Date: 12 September 2017Completi on Date: 13 December 2017Contractor: LW Trading and projects cc

The project was awarded to LW Trading and projects cc to the amount of R 369 000.00. The contract started on 12 September 2017 and was completed on 13 December 2017. Ten (10) kilometers of fence was maintained and created ten job opportuniti es for the local people.

Clearing of vegetati on along canals

Maintenance of fences


Clearing of Vegetati on

Contract Value: R249 990.00 VAT inclusiveContract Period: Three (3) months Start Date: 10 November 2017Completi on Date: 12 February 2018Contractor: Andiswa and Aphelele Constructi on (Pty) Ltd

The project was awarded to Andiswa and Aphelele Constructi on (Pty) Ltd to the amount of R 249 990.00. The contract started on 10 November 2017 and was completed on 12 February 2018. One hundred (100) kilometers of vegetati on was cleared and created ten job opportuniti es for the local people.

Burglar Bars at Central Pump Stati on and at Staff Houses

Contract Value: R196 000.00 VAT inclusiveContract Period: Two and half (2.5) monthsStart Date: 29 November 2017Completi on Date: 15 January 2018Contractor: Madips Civil

The project was awarded to Madips Civil to the amount of R 196 000.00. The contract started on 29 November 2017 and was completed on 15 January 2018 (durati on of approximately two and half months). Burglars were installed at the central pump stati on and at the four staff houses. This was a once off project and created four job opportuniti es for the local people.

Infi eld Road Maintenance

Contract Value: R430 000.00 VAT inclusiveContract Period: Three (03) monthsStart Date: 15 November 2017Completi on Date: 12 February 2018Contractor: Amakhosana Amathathu TradingThe project was awarded to Amakhosana Amathathu Trading to the amount ofR430 000.00. The contract started on 15 November 2017 and was completed on 12 February 2018 (within ti me frame),

Maintenance of fence and vegetati on along irrigati on canal


it covered quarter three and quarter four. Infi eld roads were maintained and created two job opportuniti es for the local people.

Maintenance of Fence

Contract Value: R395 003.00 VAT inclusiveContract Period: Three (3) months Start Date: 16 January 2018Completi on Date: 16 April 2018Contractor: Cool and Smooth (Pty) Ltd

The project was awarded to Cool and Smooth (Pty) Ltd to the amount of R 395 003.00. The contract started on 16 January 2018 and to be completed on 16 April 2018 (durati on of approximately three months and two weeks). The project covers quarter three and quarter four period. Ten (10) Kilometers of fence were maintained and created eight job opportuniti es for the local people.

Maintenance / Renovati on of Toilets, Roof and Tiles

Contract Value: R125 000.00 VAT inclusiveContract Period: One (01) month Start Date: 14 February 2018Completi on Date: 15 March 2018Contractor: Endaweni Contracti ng

The project was awarded to Endaweni Contracti ng to the amount of R 125 000.00. The contract started on 14 February 2018 and was completed on 15 March 2018 (completed within ti me frame). One abluti on facility building at Secti on 2 was renovated and created four job opportuniti es for the local people.

Maintenance of Fence at Secti on 1

Contract Value: R340 163.00 VAT inclusiveContract Period: One (1) month and three weeksStart Date: 05 March 2018Completi on Date: 20 April 2018Contractor: Isidingo Constructi on

The project was awarded to Isidingo Constructi on to the amount of R 349 163.00. The contract started on 05 March 2018 and to be completed 20 April 2018 (durati on of approximately one month and three weeks). The project is for the maintenance of fence at secti on one premises and created four job opportuniti es for the local people.

Rehabilitati on of Concrete Canal

Contract Value: R419 613.65 VAT inclusiveContract Period: +/- Two (2) months and two weeksStart Date: 05 March 2018Completi on Date: 18 May 2018

Contractor: Goodenough Phumelele Sphamandla (GPS) Trading

The project was awarded to Goodenough Phumelele Sphamandla (GPS) Trading to the amount of R419 613.65. The contract started on 05 March 2018 and to be completed 18 May 2018 (durati on of approximately two months and two weeks). The project covers quarter three and quarter four. The project is for the rehabilitati on of the canal and created fi ve job opportuniti es for the local people.


PART CCORPORATE GOVERNANCE


CORPORATE GOVERNANCEINTRODUCTION

Mjindi Farming (Proprietary) Limited Board of Directors regards corporate governance as an essenti al tool that forms the basis of an organisati on that is governed eff ecti vely and within the prescripts of relevant legislati ve and regulatory frameworks. The Board is committ ed to sound corporate governance in all its business acti viti es as it is fundamental to the success of the business. Governance is practi ced at all levels of the enti ty. Good governance is underpinned by the principles of openness, transparency, integrity, accountability and social responsibility as well as an inclusive approach that recognises the importance of all stakeholders. The Board has committ ed itself to ensuring that the solid founda-ti on that has been laid aids the organizati on in accelerati ng implementati on of its objecti ves.

While compliance remains a priority for the enti ty, as a state owned business enterprise, the enti ty is guided by the principles of the Code of Corporate Practi ces and Conduct contained in the King IV report on Corporate Governance for South Africa. Furthermore, the statutory duti es, responsibiliti es and provisions imposed on the Directors of Mjindi Farming by the Companies Act 71 of 2008, are augmented by those contained in the Public Finance Management Act of 2009.

SHAREHOLDING

The enti ty is wholly owned by the Government of the Republic of South Africa as represented by the Member of the Executi ve Council of Provincial Department of Agriculture and Rural Development, KwaZulu-Natal, Hournerable R T Mthembu.

SHAREHOLDER COMPACT

Mjindi Farming annually concludes a Shareholder Compact Agreement which documents the mandated key perfor-mance measures and indicators to be att ained by Mjindi Farming, as agreed between the Board of Directors (Account-ing Authority) and the Executi ve Authority. The Shareholder Compact agreement formalizes the relati onship between the Shareholder and the Board and establishes the terms and conditi ons under which the Board will administer the funds in order to achieve its objecti ves in good governance.

GOVERNING BODIES AND BOARD OF DIRECTORS

The Board of Directors of Mjindi Farming is the designated accounti ng authority appointed by the Member of the Executi ve Council which governs and controls Mjindi Farming in accordance with the provisions of the Public Finance Management Act of 1999 (PFMA), Treasury Regulati ons and South African Companies Act, 71 of 2008, as well as good corporate governance principles.

Mjindi Farming has a Board structure comprising nine Non-Executi ve Directors and the Chief Executi ve Offi cer serving as a Managing Director. The directors have extensive experience across a diverse range of sectors, which enables the Board to provide a balanced and an independent advice and judgement in the decision-making process. Profi les of each director appear on page 10 to 11. The Board was appointed on an interim basis ti ll 31 March 2018.

ROLE AND FUNCTION OF THE BOARD

The Board is the accounti ng authority of Mjindi Farming (Pty) Ltd in terms of the PFMA. The Board has a Board Charter that sets out clear a directi on on the roles and responsibiliti es of the Board.

The Board embraces the following responsibiliti es:

• Establish the vision, mission and values

• Set the enti ty’s strategies and structure

• Provide strategic directi on and leadership


• Determine the goals and objecti ves of the enti ty and monitor performance of the enti ty

• Approve all policies and procedures

• Approve the annual fi nancial statements

• Ensure good and sound corporate governance and ethics

• Ensure the eff ecti ve, effi cient and transparent systems of fi nancial and risk management and internal controls

• Ensuring eff ecti ve communicati on with relevant stakeholders

• Liaising with and reporti ng to the Shareholder

DIRECTOR INDUCTION AND ORIENTATION

During the year under review, Directors were trained on corporate governance, so as to enhance their governance capabiliti es. In order to enforce accountability, the Directors conducted a strategic workshop with management to re-inforce the understanding of the enti ty’s vision, mission, values, mandate and strategic objecti ves. Conti nuous training is also provided on request to meet the needs of Directors. Directors are also made aware of new laws and regulati ons on an on-going basis.

DIRECTORS’ REMUNERATION

Non-Executi ve Directors who are not employed by government receive fees for their contributi on to the Board and the Committ ees on which they serve. Fees are determined by the Member of the Executi ve Council, from ti me to ti me. Non-Executi ve Directors are also reimbursed for out-of-pocket expenses for the executi on of work incurred on behalf of the enti ty.

BOARD SUB-COMMITTEES

Board Sub-Committ ees have been established to assist the Board in discharging its responsibiliti es. This assistance is rendered to the Board in the form of recommendati ons and reports received from Management which are submitt ed to Board meeti ngs in ensuring transparency and full disclosure of Sub-Committ ee acti viti es. Each Committ ee operates within the ambit of its defi ned terms of reference that sets out the compositi on, role, and responsibiliti es, delegated authority and meeti ng requirements of the Committ ee. All Board Members may att end the Sub-Committ ees by invi-tati on.

The Board reviewed the Board Sub-Committ ees during the year under review in order to align them with the recom-mendati ons of the King IV Report on Corporate Governance as well as to reassign the skills of Directors to the relevant Committ ees, where their skills will be more eff ecti ve. The exercise of reconsti tuti ng the Board Sub-Committ ees result-ed in the the following Committ ees:

• Audit, Risk and Compliance Committ ee

• Finance and Human Resource Committ ee

• Infrastructure and Water Services Committ ee

• Farmer Development and Support Services Committ ee

• Chairperson’s Committ ee (EXCO)

Each of these committ ees comprises members of the Board, executi ves att end by invitati on. The responsibiliti es of the Board Sub-Committ ees are outlined below.


Audit, Risk and Compliance Committ ee

Mr MK Gwala Chairman

The Audit, Risk and Compliance committ ee is a Sub-Committ ee of the Mjindi Farming Board and it is established in terms of secti on 51(1)(a)(ii) of the PFMA and secti on 27.1.1 of the Treasury Regulati ons (PFMA 76(4)(d), also supported by King IV Report and Code on Governance in South Africa. In terms of King IV, the Board of the state-owned company must establish an Audit committ ee; as well the Board should appoint a committ ee responsible for risk. Thus the Au-dit, Risk and Compliance Committ ee, the committ ee is chaired by Mr KM Gwala who obtained a Nati onal Diploma in Internal Auditi ng from Border Technikon which is currently known as Walter Sisulu University and a B. Tech Degree in Internal Auditi ng from Durban University of Technology. Mr Gwala has currently enrolled for Post Graduate Diploma in Business Management with MANCOSA. He started his career in 2001 as an Internal Auditor at KZN Provincial Treasury, in 2004 he was promoted to be an Audit Supervisor. He then joined Ezemvelo KZN Wildlife as an Internal Audit Man-ager in 2007 ti ll to date.

The committ ee assists the Board in discharging its responsibiliti es in the form of recommendati ons and reports sub-mitt ed to Board meeti ngs regarding risk governance, eff ecti veness of internal and external auditors and fi nancial con-trols, annual fi nancial statements, annual report, in which transparency and full disclosure of committ ee acti viti es are ensured. Specifi c responsibiliti es of the committ ee include:

• Monitoring compliance with relevant legislati on and ensuring that appropriate systems of internal control are imple-mented and maintained to protect Mjindi Farming’s interests and assets.

• Ensuring that the enti ty’s internal audit functi on is independent and has the necessary resources, budget, standing and authority within the enti ty to enable it to discharge its functi ons.

• Evaluati ng the independence, objecti vity and eff ecti veness of internal and external auditors and the review of ac-counti ng and auditi ng concerns identi fi ed by internal and external audits.

• Reviewing accuracy, reliability and credibility of fi nancial reporti ng, and recommends the Annual Financial State-ments, the Annual Report together with the external auditors ‘report, for approval by the Board

• Reviewing the adequacy and overall eff ecti veness of the enti ty’s Risk Management strategy, policy, procedures and functi ons as well as the implementati on by Management of internal risk control and risk recommendati ons, and en-sures that appropriate acti ons have been taken.

• Report internally to the Board on how it has discharged its duti es, statutory as well as those assigned to it by the board, during the fi nancial year.

The membership of this committ ee comprises of fi ve independent non-executi ve directors, suffi ciently qualifi ed, fi nan-cially literate and experienced to fulfi l their duti es and the members are:

• Mr KM Gwala Chairperson

• Mr S Myeza Independent Non-Executi ve Director


Finance and Human Resources Committ ee

Mr WR Dladla Chairperson

The Finance and Human Resources Committ ee is a Sub-Committ ee of Mjindi Farming Board and is chaired by Mr W. R. Dladla who holds an Honours Degree in Agricultural Economics from University of Pretoria. Mr Dladla have been in the fi eld of human capital development for a period of 32 years serving in both public and private sectors. He has served in a number of boards sharing his skills in the fi eld of agricultural economics, educati on and training.

The committ ee assists the Board in discharging its responsibiliti es in the form of recommendati ons and reports sub-mitt ed to Board meeti ngs regarding fi nancial matt ers such as, fi nance and human resources policies, fi nancial reports, budgets, revenue, expenditure, insurance, salaries and salary Increments, staffi ng, labour relati ons in which transpar-ency and full disclosure of committ ee acti viti es are ensured.

Specifi c responsibiliti es of the committ ee include:

• Providing advice to the Board on all policy and strategy issues relati ng to Finance and Human Resources.

• Making recommendati ons to the Board on the annual budget, monitor expenditure of the budget in the course of the year and report to the Board in every Board meeti ng.

• Make recommendati ons to the Board on strategies for revenue generati ons.

• Make recommendati ons to the Board on strategies to improve revenue collecti ons by Mjindi Farming.

• Review the enti ty’s Financial Statements for each year, and makes recommendati ons to the Board for approval of the Financial Statements.

• Provide advice to the Board on all staff matt ers, including salaries and salary adjustments.

• Serves as a lead committ ee for the Board for providing guidance on strategies to be implemented for fi nancial viabil-ity and sustainability of Mjindi Farming.

• Serves as a lead committ ee for the offi ce of both the Internal Auditors and the Auditor General.

The membership of this committ ee comprises of four independent non-executi ve directors, suffi ciently experienced to fulfi l their duti es and the members are:

• Mr WR Dladla Chairperson

• Mr RV Nhlebela

• Mr SF Myeni

• Mrs TB Tembe Independent Non-Executi ve Director

• Mr WR Dladla Board member

• Mr RV Nhlebela Board member


The Infrastructure Committ ee is a Sub-Committ ee of Mjindi Farming Board chaired by Mr MD Myeni. Mr MD Myeni graduated with a Diploma in Structural at Nongoma Technical College. He has business experience in which he gained during his previous work as a Chief Works Inspector at the Department of Public Works for 24 years. He currently runs his own business in Constructi on, transport and farming.

The committ ee assists the Board in discharging its responsibiliti es in the form of recommendati ons and reports submit-ted to Board meeti ngs regarding overseeing all Mjindi Farming infrastructures and the functi oning of the Engineering Division, in which transparency and full disclosure of committ ee acti viti es are ensured.


• Providing advice to the Board on all policy and strategy issues relati ng to Infrastructure Development.

• Overseeing the repairing of all infrastructure, including drains, pipelines, pump stati ons, canals, fences, buildings, roads, etc.

• Overseeing the provision of water to farmers.

• Overseeing the use of electricity in the provision of water to farmers.

• Making recommendati ons to the Board on the acti viti es and strategies to promote bett er resource uti lizati on in the Makhathini Irrigati on Scheme.

• Advise the Board on the overall resource mobilizati on and uti lizati on in terms of infrastructure.

• Serves as a lead committ ee of the Board on strategies to improve the supply of water to farmers.

• Serves as a lead committ ee of the Board on strategies to reduce water supply costs which will eventually improve the fi nancial viability and sustainability of the Makhathini Irrigati on Scheme Farmers.

• Serves as a lead committ ee to advice the Board on the expansion of the irrigati on system.

The membership of this committ ee comprises of fi ve independent non-executi ve directors, suffi ciently experienced to fulfi l their duti es and the members are:

• Mr MD Myeni Chairperson

• Mr RV Nhlebela

• Mr J Mlambo

• Mrs B.K Ndimande

Infrastructure and Water Services Committ ee

Mr MD MyeniChairperson


Farmer Development and Support Services Committ ee

Mr WR Dladla Chairperson

The Farmer Development Portf olio Committ ee is chaired by Mr W. R. Dladla who holds an Honours Degree in Agri-cultural Economics from University of Pretoria. Mr Dladla have been in the fi eld of human capital development for a period of 32 years serving in both public and private sectors. He has served in a number of boards sharing his skills in the fi eld of agricultural economics, educati on and training.

The committ ee assists the Board in discharging its responsibiliti es in the form of recommendati ons and reports submit-ted to Board meeti ngs regarding promoti on of agri-business, Increased agricultural producti on, enhancement of agri-cultural multi pliers and linkages and General advisory and support services, in which transparency and full disclosure of committ ee acti viti es are ensured.


• Providing advice to the Board on all policy and strategy issues relati ng to Farmer Development.

• Overseeing the provision of producti on and marketi ng advice to farmers.

• Making recommendati ons to the Board on the acti viti es and strategies to promote agri-businesses in the Makhathini Irrigati on Scheme.

• Advise the Board on the overall resource mobilizati on and uti lizati on in terms of farmer development.

• Serves as a lead committ ee of the Board on strategies to improve producti vity of the farmers.

• Serves as a lead committ ee of the Board on strategies to improve the fi nancial viability and sustainability of the Makhathini Irrigati on Scheme Farmers.

The membership of this committ ee comprises of six independent non-executi ve directors suffi ciently experienced to fulfi l their duti es and the members are:

• Mr WR Dladla Chairperson

• Mr SF Myeni

• Mr MD Myeni

• Mr J Mlambo

• Mrs B.K Ndimande


Chairperson’s Committ ee

Dr T MbathaChairperson

The Chairperson’s Committ ee is chaired by the Board Chairperson and comprises of all Chairpersons of the above men-ti oned Board Sub-Committ ees. The Chief Executi ve Offi cer is a member of the Chairman’s committ ee and Management may att end the meeti ng by invitati on.

The Committ ee is responsible for guiding and leading the strategic directi on of Mjindi Farming and the implementati on thereof.

The role includes:

• Defi ning Mjindi Farming strategy in line with Mjindi Farming’s mandate

• Guiding and leading the implementati on of the strategy

• Developing and managing the strategy capability requirements

• Managing business needs

• Evaluate Mjindi Farming’s governance structures, meeti ng terms of references, governance in Mjindi Farming in general, and to make recommendati ons to the Board and Management on the improvement, executi on and control of governance and ethics in the enti ty.

• Defi ne Mjindi Farming Stakeholder Management strategy in line with the Mjindi Farming mandate

• Guide and lead the implementati on of the strategy

• Monitor the development and implementati on of the strategy

• Ensure effi cient stakeholder relati ons

• Monitor the strategy capability requirements

BOARD AND SUB-COMMITTEES MEETING ATTENDANCE 2017/2018

Board Member

Board meet-ings att ended

Finance & HR meeti ngs

Infrastructure meeti ngs

Farmer Development meeti ngs

Audit Committ ee meeti ngs

Chairperson’s Committ ee meeti ngs

Other meeti ngs( stakeholder, site visits, parliament, interviews

Dr Martha .S Mbatha

12 - 2 1 5 3 12

Mr Wakhe .R Dladla

12 4 1 4 8 3 11


Board Member

Board meet-ings att ended

Finance & HR meeti ngs

Infrastructure meeti ngs

Farmer Development meeti ngs

Audit Committ ee meeti ngs

Chairperson’s Committ ee meeti ngs

Other meeti ngs( stakeholder, site visits, parliament, interviews

Mr Bonginko-si .S.G Zondi

10 3 3 - 3 2 7

Mr Richard .V Nhlebela

12 3 3 - 1 - 3

Mr John Mlambo

12 - 4 4 - - 3

Mrs Beatrice .K Ndimande

9 - 4 4 - - 5

Mr Soneni .F Myeni

12 4 - 4 - - 5

Mr Michael .D Myeni

10 - 4 3 - 1 2

Mr Mnqobi .K Gwala

- - - - 8 3 -

Mr Siphaman-dla Myeza

- - - - 5 - -

Mrs Busi .T Tembe

- - - - 1 - -

PUBLIC FINANCE MANAGEMENT ACT

The PFMA regulates fi nancial management inclusive of all revenue, expenditure, assets and liabiliti es in state owned business enterprises in order to ensure that they are managed effi ciently and eff ecti vely and to provide for the respon-sibiliti es of persons entrusted with fi nancial management. The Board, as the Accounti ng Authority, complies with these fi duciary duti es as set out in the PFMA. In terms of the PFMA, the responsibiliti es of the Board include inter alia taking appropriate acti on to ensure that:• Economic, effi cient, eff ecti ve and transparent systems of fi nancial and risk management and controls are in place;

• All major capital projects are evaluated prior to a fi nal decision on each project;

• Appropriate and eff ecti ve measures are implemented to prevent unauthorised, irregular, fruitless and wasteful ex-penditure, expenditure not complying with legislati on, or losses from criminal or fraudulent conduct;

• All revenues due to Mjindi Farming are accounted for;

• There is economic and effi cient management of available working capital;

• The defi niti on of objecti ves and the allocati on of resources are allocated in an economic, effi cient, eff ecti ve and transparent manner.

In terms of the Treasury Regulati ons (TR 28.3.1), Mjindi Farming as Accounti ng Authority must, for purposes of ‘mate-rial’ and ‘signifi cance’, in terms of secti ons 54(2) and 55(2) of the PFMA, develop and agree on a framework of accept-able levels of materiality and signifi cance with the relevant Executi ve Authority.

The King IV report requires that disclosure be made on matt ers of signifi cance, interest and relevance to the Sharehold-er and a wide range of stakeholders. The Accounti ng Authority should establish guidelines of materiality for disclosure by the organisati on.

RISK MANAGEMENT

Public Finance Management Act secti on 51 (1) (a) (i) requires that the Board has and maintains an eff ecti ve, effi cient and transparent system of fi nancial and risk management and internal control. The recommendati ons of the King IV report and Code on Governance have been considered, applied and integrated in the daily acti viti es of all employees


within the enti ty. The enti ty conti nues to implement the risk management policy which assists Mjindi Farming in ad-dressing key elements of the risk management, allows for the management of risks within defi ned risk parameters, risk appeti te and tolerances as well as the risk management standards. It also provides a framework for the eff ecti ve identi fi cati on, evaluati on, management, measurement and the reporti ng of Mjindi Farming’s risks.

The Board is responsible for the governance of risk, ensuring that a comprehensive Risk Management strategy has been developed and implemented, as well as the acceptable risk appeti te and risk tolerance levels have been set. The Board has ensured that appropriate mechanisms for the monitoring and reporti ng of risks by Management have been implemented. A formal strategic risk assessment is conducted annually by the Board and Management, this process includes the identi fi cati on and assessment of key strategic risks, the implementati on and conti nual review and monitoring of the process to ensure that all risks are managed and miti gated to acceptable levels set by the Board. The Strategic Risk register is maintained to ensure that all identi fi ed risks are cascaded to operati onal risk with proper miti gati on recommendati ons.

FRAUD AND CORRUPTION

Mjindi Farming is committ ed to eradicati ng all forms of fraud and corrupti on. Mjindi Farming conti nues to implement the approved fraud preventi on plan and the desired outcome is the eliminati on of cases of fraud. The main aim of the plan is to fi ght fraud and corrupti on, while encouraging the public and employees to report any allegati ons of fraud, corrupti on, improper conduct and other contraventi ons of Mjindi Farming’s code of conduct. Investi gati ons will be conducted independently and reported to the Audit, Risk and Compliance Committ ee. Internal Audit monitors the outcome and acti ons taken. The plan is reviewed annually and updated where necessary to reduce the number of incidents, possible risks, irregulariti es and fraud. Mjindi Farming has adopted a policy of ‘zero tolerance’ against any acts of fraud and corrupti on. There were no fraud and corrupti on cases reported during the year under review.

INTERNAL AUDIT

Public Finance Management Act (PFMA) secti on 51(1) (a) (ii) requires that the Accounti ng Authority ensures that Mjindi Farming has and maintains a system of internal audit under the control and direct supervision of the Audit, Risk and Compliance Commit-tee. The purpose, authority and responsibility of the Internal Audit functi on is formally defi ned in the internal audit charter which is annually reviewed by the Audit, Risk and Compliance Committ ee and submitt ed to the Board for approval. In accordance with the overriding requirement of independence and objecti vity, Internal Audit, reports functi onally to the Chairman of the Audit, Risk and Compliance Committ ee and administrati vely to the Chief Executi ve Offi cer. Internal Audit provides assurance services to evaluate and assist Management in improving the eff ecti veness of risk management, control and governance processes within Mjindi Farming.

Internal Audit conducts its audits and reviews in accordance with the standards set by the Internati onal Professional Practi ces Framework (IPPF) as promulgated by The Insti tute of Internal Auditors (IIA) and the standards set by the Informati on Systems and Control Associati on (ISACA). All internal auditors are required to apply and uphold the principles of integrity, objecti vity, indepen-dence, confi denti ality and competency under the IIA’s Standard and Code of Ethics.

Internal Audit functi on has been performed by HTB Consulti ng, a company that keeps abreast with the latest developments within the profession. The Internal Audit Plan for the 2017/18 fi nancial year was developed through the identi fi cati on of key high risks that were derived from Mjindi Farming’s risk management processes, discussions with management and Mjindi Farming’s strategic plan. The Internal Audit should follow a risk based approach to its audit plan aft er considering the strategy and risk of the enti ty. The best practi ce recommendati ons of the King IV report and code of Governance and the requirements of the Companies Act of 2008 were considered in developing the Internal Audit Plan. The Internal Audit Plan was approved by the Audit, Risk and Compli-ance Committ ee at the beginning of the fi nancial year. The Internal Audit Plan is regularly reviewed and is updated when necessary in response to any new and emerging risks identi fi ed that may impact on the risk profi le of the enti ty.

Internal Audit att ends all Audit, Risk and Compliance Committ ee meeti ngs where reporti ng occurs on all identi fi ed material or signifi cant control weaknesses, the acti ons taken by Management to address the control defi ciencies, progress and performance made on its plan including any signifi cant matt er that may need to be brought to the att enti on of the Audit, Risk and Compliance Committ ee. The Internal Audit quarterly report assists the Audit, Risk and Compliance Committ ee in discharging its responsibiliti es.

RESPONSIBILITY OF REPORTING

In order to present a balanced and understandable assessment of its positi on, Mjindi Farming conti nuously strives to ensure that reporti ng and disclosure to stakeholders are comprehensive, relevant, transparent, clear and eff ecti ve. It places great emphasis on addressing both positi ve and negati ve aspects in order to demonstrate the long-term viability and sustainability of the enti ty.


COMMUNICATION WITH STAKEHOLDERS

Mjindi Farming recognises the rightf ul interests of stakeholders in its aff airs, including government as shareholder, Amakhosi, Trusts, government departments, employees, Farmers, Suppliers, the media, policy and regulatory bodies. Communicati on and interacti ve initi ati ves with stakeholders are ongoing and are addressed through appropriate channels depending on the diff erent needs of the various stakeholders.

COMPANY SECRETARIAT FUNCTION

Directors have unrestricted access to the advice and services of the Company Secretary. In additi on to the Company Secretary’s normal duti es and functi ons as prescribed in the Companies Act and further outlined in the King IV report, the Company Secre-tary assists with other assurance functi ons in the monitoring of Mjindi Farming’s compliance with the provisions of the PFMA, Companies Act and other relevant legislati on. During the year under review, C&H accounti ng performed the Company Secretariat functi on.

56 M J I N D I F A R M I N G A N N U A L R E P O R T 2 0 1 7 - 2 0 1 856 M J I N D I F A R M I N G A N N U A L R E P O R T 2 0 1 7 - 2 0 1 8

PART DANNUAL FINANCIAL STATEMENTS


MJINDI FARMING (PROPRIETARY) LIMITED(Registrati on number 1993/007159/07)

Annual Financial Statements for the year ended 31 March 2018

ACCOUNTING AUTHORITY’S RESPONSIBILITIES AND APPROVAL

The accounti ng authority is required in terms of the Companies Act 71 of 2008 to maintain adequate accounti ng re-cords and are responsible for the content and integrity of the annual fi nancial statements and related fi nancial infor-mati on included in this report. It is his responsibility to ensure that the annual fi nancial statements fairly present the state of aff airs of the enti ty as at the end of the fi nancial period and the results of its operati ons and cash fl ows for the period then ended, in conformity with South African Statements of Generally Accepted Accounti ng Practi ce. The external auditors are engaged to express an independent opinion on the annual fi nancial statements.

The annual fi nancial statements are prepared in accordance with South African Statements of Generally Accepted Accounti ng Practi ce and are based upon appropriate accounti ng policies consistently applied and supported by reason-able and prudent judgements and esti mates.

The accounti ng authority acknowledge that they are ulti mately responsible for the system of internal fi nancial control established by the enti ty and place considerable importance on maintaining a strong control environment. To enable the accounti ng authority to meet these responsibiliti es, the accounti ng authority sets standards for internal control aimed at reducing the risk of error or loss in a cost eff ecti ve manner. The standards include the proper delegati on of responsibiliti es within a clearly defi ned framework, eff ecti ve accounti ng procedures and adequate segregati on of du-ti es to ensure an acceptable level of risk. These controls are monitored throughout the enti ty and all employees are required to maintain the highest ethical standards in ensuring the enti ty’s business is conducted in a manner that in all reasonable circumstances is above reproach. The focus of risk management in the enti ty is on identi fying, assessing, managing and monitoring all known forms of risk across the enti ty. While operati ng risk cannot be fully eliminated, the enti ty endeavours to minimise it by ensuring that appropriate infrastructure, controls, systems and ethical behaviour are applied and managed within predetermined procedures and constraints.

The accounti ng authority is of the opinion, based on the informati on and explanati ons given by management, that the system of internal control provides reasonable assurance that the fi nancial records may be relied on for the prepara-ti on of the annual fi nancial statements. However, any system of internal fi nancial control can provide only reasonable, and not absolute, assurance against material misstatement or loss.

The accounti ng authority has reviewed the enti ty’s cash fl ow forecast for the period 1 April 2018 to 31 March 2019 and, in light of this review and the current fi nancial positi on, they are sati sfi ed that the enti ty has or had access to adequate resources to conti nue in operati onal existence for the foreseeable future.

The external auditors are responsible for independently auditi ng and reporti ng on the enti ty’s annual fi nancial state-ments. The annual fi nancial statements have been examined by the enti ty’s external auditors and their report is pre-sented on page 66 to 99.

The annual fi nancial statements set out on pages 66 to 99, which have been prepared on the going concern basis, were approved by the accounti ng authority on 23 May 2018 and were signed on their behalf by:

Approval of fi nancial statements

________________________________

Dr Martha Senzangani Mbatha on behalf of Board of Directors


The accounti ng authority have pleasure in submitti ng the report on the annual fi nancial statements of Mjindi Farming (Pty) Ltd for the period ended 31 March 2018.

1. Nature of business

The main business of the enti ty is to act as an agent on behalf of the Provincial Department of Agriculture and Rural Development, KwaZulu-Natal, in the administrati on of the Makhathini Irrigati on Scheme and operates in South Afri-ca. The enti ty’s main sources of revenue are the provision of water to farmers and grant funding from the Provincial Department of Agriculture and Rural Development, KwaZulu- Natal.

2. Review of fi nancial results and acti viti es

The annual fi nancial statements have been prepared in accordance with South African Statements of Generally Ac-cepted Accounti ng Practi ce and the requirements of the Companies Act 71 of 2008. The accounti ng policies have been applied consistently compared to the prior year.

3. Share capital

There have been no changes to the authorised or issued share capital during the year under review.

4. Dividends

There were no dividends declared or paid during the reporti ng period.

5. Public Finance Management Act

Public Finance Management Act Compliance

Various secti ons of the Public Finance Management Act place responsibility on the accounti ng authority to ensure that the enti ty complies with all applicable legislati on. Any non-compliance with legislati on is reported to the Mem-ber of Executi ve Council.

Materiality and Signifi cance Framework

A Materiality and Signifi cance Framework has been developed for reporti ng losses through criminal conduct and irregular, fruitless and wasteful expenditure, as well as for signifi cant transacti ons. Material Losses through Criminal Conduct, Irregular, Fruitless and Wasteful Expenditure. Secti on 55(2) (b) of the Public Finance Management Act re-quires that the enti ty include in the Annual Report parti culars of any material losses through criminal conduct and any irregular and fruitless and wasteful expenditure that occurred during the fi nancial year.

Irregular, Fruitless and Wasteful Expenditure

The enti ty has incurred irregular, fruitless and wasteful expenditure during the year under review, as set out in the Public Finance Management Act.

Basis of Presentati on

The annual fi nancial statements are prepared in accordance with the South African Statements of Generally Ac-cepted Accounti ng Practi ce, and in a manner required by the Public Finance Management Act 1 of 1999 and South African Companies Act 71 of 2008. Various secti ons of the Public Finance Management Act place responsibility on the accounti ng authority to ensure that the enti ty complies with all applicable legislati on.

6. Insurance and risk management

The company follows a policy of reviewing the risks relati ng to assets and possible liabiliti es arising from business transacti ons with its insurers on an annual basis. Wherever possible assets are automati cally included. There is also a conti nuous asset risk control programme, which is carried out in conjuncti on with the company’s insurance bro-kers. All risks are considered to be adequately covered, except for politi cal risks, in the case of which as much cover as is reasonably available has been arranged.

7. Accounti ng authority

The accounti ng authority’s in offi ce at the date of this report are as follows:

Martha Senzangani Mbatha Non-executi ve South African

Wakhe Richard Dladla Non-executi ve South African

Bonginkosi Sibusiso Gabriel Zondi Non-executi ve South African

Richard Vusimuzi Nhlebela Non-executi ve South African

Soneni Fredman Myeni Non-executi ve South African




ACCOUNTING AUTHORITY’S REPORT

7. Accounti ng authority (conti nue...)

Beatrice Khonzeni Ndimande John Mlambo Non-executi ve South African

Michael Dumisani Myeni Non-executi ve South African

8. Events aft er the reporti ng period

The accounti ng authority is not aware of any material event which occurred aft er the reporti ng date and up to the date of this report.

9. Going concern

The directors believe that the enti ty has adequate fi nancial resources to conti nue in operati on for the foreseeable future and accordingly the annual fi nancial statements have been prepared on a going concern basis. The directors have sati sfi ed themselves that the enti ty is in a sound fi nancial positi on and that it has access to suffi cient borrowing faciliti es to meet its foreseeable cash requirements. The directors are not aware of any new material changes that may adversely impact the enti ty. The directors are also not aware of any material non-compliance with statutory or regulatory requirements or of any pending changes to legislati on which may aff ect the enti ty.

10. Secretary

The company secretary is C & H Accounti ng Incorporated.

11. Ownership

The enti ty is wholly owned by the Government of South Africa as represented by the Member of the Executi ve Council of the Provincial Department of Agriculture and Rural Development, KwaZulu-Natal, Mr RT Mthembu.

12. Internal Controls

The Accounti ng authority has the ulti mate responsibility for establishing, implementi ng and maintaining a frame-work of internal controls. The controls are designed to provide cost eff ecti ve assurance that the asset are safeguard-ed and that liabiliti es and working capital are eff ecti vely managed.

An Audit Committ ee which is responsible for monitoring the enti ty’s internal control structure, including fi nancial controls, accounti ng policy implementati on and fi nancial reporti ng, as well as reviewing and agreeing internal con-trol plans has been appointed and have been able to discharge their responsibility with the assistance of Internal Audit.

The annual fi nancial statements set out on pages 66 to 99, which have been prepared on the going concern basis, were approved by the on 23 May 2018 and

Signed on behalf of the Board of Directors by:

_____________________________________

Dr Martha Senzangani Mbatha Chairperson


REPORT OF THE AUDIT, RISK AND COMPLIANCE COMMITTEE OF MJINDI FARMING (PTY) LTD

Overview

The Audit, Risk and Compliance Committ ee of Mjindi Farming (Pty) Ltd presents its report for the fi nancial year ended 31 March 2018.

The Audit, Risk and Compliance Committ ee of Mjindi Farming (Pty) Ltd reports that it has complied with its responsibil-iti es arising from Secti on 51 which state that “(1) The Accounti ng Authority for a public enti ty (a) must ensure that the public enti ty has and maintains (i) eff ecti ve, effi cient and transparent systems of fi nancial and risk management and internal control; (ii) a system of internal audit under the control and directi on of an audit committ ee complying with and operati ng in accordance with regulati ons and instructi ons prescribed in terms of secti ons 76 and 77.

The committ ee’s operati on is guided by a detailed charter that is informed by the Companies Act, 2008 (as amended) and King III and approved by the Board.

Audit Committ ee Responsibility

The Audit, Risk and Compliance Committ ee of Mjindi Farming (Pty) Ltd is established in compliance with and reference to the following:(i) Public Finance Management Act No. 1 of 1999, Sec 51 (a), 76 & 77(ii) King 3 Report on Corporate Governance.

The Audit, Risk and Compliance Committ ee of Mjindi Farming (Pty) Ltd has regulated its aff airs in compliance with its Charter, and has discharged all its responsibiliti es and carried out all its functi ons as contained in its Terms of Reference and as required by the Companies Act, 2008, as amended.

This report relates to the Committ ee’s statutory duti es only. Its functi ons and responsibiliti es are set out in its charter, as approved by the Board and adopted by the Committ ee.

Financial Statement

The Audit, Risk and Compliance Committ ee has evaluated the annual fi nancial statements for the year ended 31 March 2018 prior to submission to the Offi ce of the Auditor General and was sati sfi ed that it complied in all material respects with the requirements of the Act and has recommended them for adopti on by the Board. The review that is conducted by the Audit, Risk and Compliance Committ ee is a high level review aft er the Internal Audit has performed the detail review of the transacti ons. Internal Audit provided assurance report to the Audit, Risk and Compliance Committ ee that they have audited fi nancial statements and there were no fi nancial misstatements identi fi ed and errors noted have been corrected.

The committ ee:• Confi rmed, based on Internal Audit’s review, that the annual fi nancial statements were prepared on the going

concern basis;

• Examined the annual fi nancial statements and other fi nancial informati on made public, prior to their approval by the Board;

• Considered the appropriateness of accounti ng policies and any changes made

Following the review by the committ ee of the annual fi nancial statements of Mjindi Farming (Pty) Ltd for the year end-ed 31 March 2018, the committ ee is of the view that, in all material respects, it complies with the relevant provisions of the Companies Act and South African Statements of Generally Accepted Accounti ng Practi ce and fairly presents the fi nancial positi on at that date and the results of its operati ons and cash fl ows for the year. Having achieved its objecti ves for the fi nancial year, the committ ee recommended the annual fi nancial statements for the year ended 31 March 2018 for the approval by the Board.

Internal Control and Internal Audit

• Mjindi Farming has appointed HTB consulti ng in October 2017 to provide internal audit services. • HTB consulti ng manage to perform SCM audit before the fi nancial year end 31 March 2018.


Risk management and legal requirements

The enti ty has conducted the risk assessment workshop facilitated by KZN Provincial Treasury, whereby the strategic risks were identi fi ed together with miti gati ng strategies.The committ ee considered the progress reports provided by management, and the auditors regarding compliance with legal and regulatory requirements.

______________________Mr MK Gwala Chairperson of the Audit, Risk and Compliance Committ ee


REPORT OF THE AUDITOR-GENERAL TO THE KWAZULU-NATAL PROVINCIAL LEGISLATURE ON MJINDI FARMING (PTY) LTDReport on the audit of the fi nancial statements

Opinion

1. I have audited the fi nancial statements of the Mjindi Farming (Pty) Ltd set out on pages 66 to 99, which comprise the statement of fi nancial positi on as at 31 March 2018, the statement of profi t or loss and other comprehensive income, statement of changes in equity, and statement of cash fl ows for the year then ended, as well as the notes to the fi nan-cial statements, including a summary of signifi cant accounti ng policies.

2. In my opinion, the fi nancial statements present fairly, in all material respects, the fi nancial positi on of the Mjindi Farming (Pty) Ltd as at 31 March 2018, and its fi nancial performance and cash fl ows for the year then ended in ac-cordance with the South African Standards of Generally Accepted Accounti ng Practi ce (SA Standards of GAAP), the requirements of the Public Finance Management Act of South Africa, 1999 (Act No. 1 of 1999) (PFMA) and the Compa-nies Act of South Africa, 2008 (Act No. 71 of 2008) (Companies Act).

Basis for opinion

3. I conducted my audit in accordance with the Internati onal Standards on Auditi ng (ISAs). My responsibiliti es under those standards are further described in the auditor-general’s responsibiliti es for the audit of the fi nancial statements secti on of this auditor’s report.

4. I am independent of the enti ty in accordance with the Internati onal Ethics Standards Board for Accountants’ Code of ethics for professional accountants (IESBA code) and the ethical requirements that are relevant to my audit in South Africa. I have fulfi lled my other ethical responsibiliti es in accordance with these requirements and the IESBA code.

5. I believe that the audit evidence I have obtained is suffi cient and appropriate to provide a basis for my audit opinion.

Emphasis of matt er

6. I draw att enti on to the matt er below. My opinion is not modifi ed in respect of this matt er.

Material impairments

7. As disclosed in note 35 to the fi nancial statements, material impairments of R1,88 million (2017: R4,05 million) were incurred as a result of irrecoverable trade receivables.

Other matt er

8. I draw att enti on to the matt er below. My opinion is not modifi ed in respect of this matt er.

Unaudited supplementary schedules

9. The supplementary informati on set out on page 34 does not form part of the fi nancial statements and is presented as additi onal informati on. I have not audited these schedules and, accordingly, I do not express an opinion thereon.

Responsibiliti es of the accounti ng authority for the fi nancial statements

10. The accounti ng authority is responsible for the preparati on and fair presentati on of the fi nancial statements in accordance with SA Standards of GAAP and the requirements of the PFMA and Companies Act, and for such internal control as the accounti ng authority determines is necessary to enable the preparati on of fi nancial statements that are free from material misstatement, whether due to fraud or error.

11. In preparing the fi nancial statements, the accounti ng authority is responsible for assessing the Mjindi Farming (Pty) Ltd’s ability to conti nue as a going concern, disclosing, as applicable, matt ers relati ng to going concern and using the going concern basis of accounti ng unless the accounti ng authority either intends to liquidate the enti ty or to cease operati ons, or has no realisti c alternati ve but to do so.

Auditor-general’s responsibiliti es for the audit of the fi nancial statements

12. My objecti ves are to obtain reasonable assurance about whether the fi nancial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes my opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to infl uence the economic decisions of users taken on the basis of these fi nancial statements.

13. A further descripti on of my responsibiliti es for the audit of the fi nancial statements is included in the annexure to this auditor’s report.


Report on the audit of the annual performance report

Introducti on and scope

14. In accordance with the Public Audit Act of South Africa, 2004 (Act No. 25 of 2004) (PAA) and the general noti ce issued in terms thereof, I have a responsibility to report material fi ndings on the reported performance informati on against predetermined objecti ves for selected programmes presented in the annual performance report. I performed procedures to identi fy fi ndings but not to gather evidence to express assurance.

15. My procedures address the reported performance informati on, which must be based on the approved perfor-mance planning documents of the enti ty. I have not evaluated the completeness and appropriateness of the perfor-mance indicators/ measures included in the planning documents. My procedures also did not extend to any disclosures or asserti ons relati ng to planned performance strategies and informati on in respect of future periods that may be included as part of the reported performance informati on. Accordingly, my fi ndings do not extend to these matt ers.

16. I evaluated the usefulness and reliability of the reported performance informati on in accordance with the criteria developed from the performance management and reporti ng framework, as defi ned in the general noti ce, for the fol-lowing selected programmes presented in the annual performance report of the enti ty for the year ended 31 March 2018:

Programmes Pages in the annual performance report

Programme 2 – Farmer development and support services 20 - 38

Programme 3 – Infrastructure and water services 38 - 44

17. I performed procedures to determine whether the reported performance informati on was properly presented and whether performance was consistent with the approved performance planning documents. I performed further procedures to determine whether the indicators and related targets were measurable and relevant, and assessed the reliability of the reported performance informati on to determine whether it was valid, accurate and complete.

18. I did not raise any material fi ndings on the usefulness and reliability of the reported performance informati on for programme 2 - farmer development and support services and programme 3 - infrastructure and water services.

Other matt er

19. I draw att enti on to the matt er below.

Achievement of planned targets

20. The annual performance report on pages 20 to 44 contains informati on on the achievement of planned targets for the year and explanati ons are provided for the under and over achievement of a number of targets.

Report on the audit of compliance with legislati on

Introducti on and scope

21. In accordance with the PAA and the general noti ce issued in terms thereof, I have a responsibility to report material fi ndings on the compliance of the enti ty with specifi c matt ers in key legislati on. I performed procedures to identi fy fi ndings but not to gather evidence to express assurance.

22. The material fi ndings on compliance with specifi c matt ers in key legislati on are as follows:

Annual fi nancial statements

23. The fi nancial statements submitt ed for auditi ng were not prepared in accordance with the prescribed fi nancial reporti ng and supported by full and proper records, as required by secti on 55(1) (a) and (b) of the PFMA and secti on 29(1)(a) of the Companies Act. Material misstatements of investment property, transfers and subsidies and govern-ment grants identi fi ed by the auditors in the submitt ed fi nancial statements were corrected subsequently resulti ng in the fi nancial statements receiving an unqualifi ed audit opinion.

Other informati on

24. The accounti ng authority is responsible for the other informati on. The other informati on comprises the informa-ti on included in the annual report. The other informati on does not include the fi nancial statements, the auditor’s re-port and those selected programmes presented in the annual performance report that have been specifi cally reported in this auditor’s report.

25. My opinion on the fi nancial statements and fi ndings on the reported performance informati on and compliance with legislati on do not cover the other informati on and I do not express an audit opinion or any form of assurance conclusion thereon.


26. In connecti on with my audit, my responsibility is to read the other informati on and, in doing so, consider whether the other informati on is materially inconsistent with the fi nancial statements and the selected programmes presented in the annual performance report, or my knowledge obtained in the audit, or otherwise appears to be materially mis-stated.

27. The other informati on we obtained prior to the date of this auditor’s report is the accounti ng authority’s report, and the audit committ ee report is expected to be made available to us aft er 31 July 2018.

28. If, based on the work we have performed on the other informati on that we obtained prior to the date of this au-ditor’s report, we conclude that there is a material misstatement in this other informati on, we are required to report that fact. I have nothing to report in this regard.

29. Aft er we receive and read the audit committ ee report, and if we conclude that there is a material misstatement, we are required to communicate the matt er to those charged with governance and request that the other informati on be corrected. If the other informati on is not corrected, we may have to retract this auditor’s report and re-issue an amended report as appropriate. However, if it is corrected this will not be necessary.

Internal control defi ciencies

30. I considered internal control relevant to my audit of the fi nancial statements, reported performance informati on and compliance with applicable legislati on; however, my objecti ve was not to express any form of assurance on it.

31. The matt ers reported below are limited to the signifi cant internal control defi ciencies that resulted in the fi ndings on compliance with legislati on included in this report.

Leadership

32.There is a lack of oversight responsibility regarding fi nancial reporti ng and compliance with legislati on as well as related internal controls. Leadership did not ensure that eff ecti ve measures were implemented to ensure compliance with the fi nancial reporti ng framework.

Financial management

33. Systems and controls were not designed in a manner that would prevent, detect and address risks that had an im-pact on fi nancial reporti ng. In this regard, the fi nancial statements were not adequately reviewed by management to ensure compliance with the applicable reporti ng framework.

Other reports

34. I draw att enti on to the following engagements conducted by various parti es that had, or could have, an impact on the matt ers reported in the enti ty’s fi nancial statements, reported performance informati on, compliance with applica-ble legislati on and other related matt ers. These reports did not form part of my opinion on the fi nancial statements or my fi ndings on the reported performance informati on or compliance with legislati on.

35. The Special Investi gati ons Unit is currently conducti ng an investi gati on at the request of the executi ve authority for the Department of Agriculture and Rural Development on the alleged fi nancial misconduct that occurred in 2011 relati ng to procurement process that were not followed. The investi gati on is sti ll in progress at 31 March 2018.

Pietermaritzburg

31 July 2018


Annexure – Auditor-general’s responsibility for the audit

1. As part of an audit in accordance with the ISAs, I exercise professional judgement and maintain professional scepti -cism throughout my audit of the fi nancial statements, and the procedures performed on reported performance infor-mati on for selected programmes and on Mjindi Farming (Pty) Ltd’s compliance with respect to the selected subject matt ers.

Financial statements

2. In additi on to my responsibility for the audit of the fi nancial statements as described in this auditor’s report, I also:

• identi fy and assess the risks of material misstatement of the fi nancial statements whether due to fraud or error, de-sign and perform audit procedures responsive to those risks, and obtain audit evidence that is suffi cient and appropri-ate to provide a basis for my opinion. The risk of not detecti ng a material misstatement resulti ng from fraud is higher than for one resulti ng from error, as fraud may involve collusion, forgery, intenti onal omissions, misrepresentati ons, or the override of internal control

• obtain an understanding of internal control relevant to the audit in order to design audit procedures that are ap-propriate in the circumstances, but not for the purpose of expressing an opinion on the eff ecti veness of the enti ty’s internal control

• evaluate the appropriateness of accounti ng policies used and the reasonableness of accounti ng esti mates and relat-ed disclosures made by the accounti ng offi cer

• conclude on the appropriateness of the accounti ng authority’s use of the going concern basis of accounti ng in the preparati on of the fi nancial statements. I also conclude, based on the audit evidence obtained, whether a material un-certainty exists related to events or conditi ons that may cast signifi cant doubt on the Mjindi Farming (Pty) Ltd’s ability to conti nue as a going concern. If I conclude that a material uncertainty exists, I am required to draw att enti on in my auditor’s report to the related disclosures in the fi nancial statements about the material uncertainty or, if such disclo-sures are inadequate, to modify the opinion on the fi nancial statements. My conclusions are based on the informati on available to me at the date of this auditor’s report. However, future events or conditi ons may cause an enti ty to cease conti nuing as a going concern

• evaluate the overall presentati on, structure and content of the fi nancial statements, including the disclosures, and whether the fi nancial statements represent the underlying transacti ons and events in a manner that achieves fair pre-sentati on

Communicati on with those charged with governance

3. I communicate with the accounti ng authority regarding, among other matt ers, the planned scope and ti ming of the audit and signifi cant audit fi ndings, including any signifi cant defi ciencies in internal control that I identi fy during my audit.

4. I also confi rm to the accounti ng authority that I have complied with relevant ethical requirements regarding inde-pendence, and communicate all relati onships and other matt ers that may reasonably be thought to have a bearing on my independence and, where applicable, related safeguards.




STATEMENT OF FINANCIAL POSITION AS AT 31 MARCH 2018

Figures in Rand Notes 20182017

Restated

Assets

Non-Current Assets

Investment property 2 2,455,028 2,498,165

Property, plant and equipment 3 55,545,168 50,404,191

Intangible assets 4 1 65,248

58,000,197 52,967,604

Current Assets

Inventories 5 3,109,376 2,591,135

Trade and other receivables 6 11,102,988 10,079,793

Cash and cash equivalents 7 7,085,433 5,529,016

21,297,797 18,199,944

Total Assets 79,297,994 71,167,548

Equity and Liabiliti es

Equity

Share capital 8 100 100

Reserves 9&10 36,869,551 30,481,826

Retained income 37,333,721 38,753,183

74,203,372 69,235,109

Liabiliti es

Non-Current Liabiliti es

Rent deposits 11 8,286 -

Finance lease liabiliti es 12 14,387 19,559

22,673 19,559

Current Liabiliti es

Finance lease liabiliti es 12 26,005 21,292

Trade and other payables 13 4,262,740 1,079,241

Accrual 14 145 7,426

Provision for leave 15 783,059 804,921

5,071,949 1,912,880

Total Equity and Liabiliti es 79,297,994 71,167,548




STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME


Restated

Water supply services and rental income 16 5,104,028 5,301,015

Government grants and subsidies 16 49,123,684 46,651,754

54,227,712 51,952,769

Other income 17 2,153,109 1,892,614

Operati ng, administrati on and direct expenditure 35 (58,192,278) (50,794,821)

Operati ng surplus/(loss) 1,811,457 3,050,562

Investment revenue 18 399,612 562,402

Finance costs 19 (7,617) (9,671)

Surplus/(loss) for the year (1,419,462) 3,603,293

Other comprehensive income:

Items that will not be reclassifi ed to profi t or loss:

Gains on property revaluati on 9 6,387,724 -

Total comprehensive income for the year 4,968,262 3,603,293




STATEMENT OF CHANGES IN EQUITY

Figures in RandShare capital

Revaluati onreserve Other NDR

Total reserves

Accumulated surplus

Total equity

Balance at 1 April 2016 restated

100 21,724,915 8,756,912 30,481,827 35,105,041 65,586,968

Surplus for the year restated

- - - - 3,603,293 3,603,293

Prior period errors - sundry equipment cost

- - - - 44,849 44,849

Balance at 1 April 2017 100 21,724,915 8,756,912 30,481,827 38,753,183 69,235,111

Surplus for the year (1,419,462) (1,419,462)

Revaluati on 6,387,724 6,387,724 6,387,724

Balance at 31 March 2018 100 28,112,639 8,756,912 36,869,551 37,333,721 74,203,372

Note(s) 8 9 10




STATEMENT OF CASH FLOWS


Restated

Cash fl ows from operati ng acti viti es

Cash receipts from customers 53,275,364 55,733,719

Cash paid to suppliers and employees (50,486,799) (60,555,415)

Cash generated from operati ons 21 2,788,565 (4,821,696)

Interest income 399,612 562,402

Finance costs (7,617) (9,671)

Net cash from operati ng acti viti es 3,180,560 (4,268,965)

Cash fl ows from investi ng acti viti es

Purchase of property, plant and equipment 3 (1,623,684) (995,085)

Disposal of property, plant and equipment 3 - 38,618

Net cash from investi ng acti viti es (1,623,684) (956,467)

Cash fl ows from fi nancing acti viti es

Finance lease payments (459) (65,459)

Total cash movement for the year 1,556,417 (5,290,891)

Cash at the beginning of the year 5,529,016 10,819,907

Total cash at end of the year 7 7,085,433 5,529,016




ACCOUNTING POLICIES

1. Signifi cant accounti ng policies

The annual fi nancial statements have been prepared in accordance with South African Statements of Generally Accepted Accounti ng Practi ce and in a manner required by the Public Finance Management Act No. 1 of 1999 and South African Companies Act, 71 of 2008. The annual fi nancial statements have been prepared on the historical cost basis, and incorporate the principal accounti ng policies set out below. They are presented in South African Rands. These accounti ng policies are consistent with the previous period.

Comparati ve informati on

When the presentati on or classifi cati on of items in the annual fi nancial statements is amended, prior period com-parati ve amounts are restated. Where accounti ng errors have been identi fi ed in the current year, the correcti on is made retrospecti vely as far as is practi cable and the prior year comparati ves are restated accordingly. Where there has been a change in accounti ng policy in the current year, the adjustment is made retrospecti vely as far as is prac-ti cable, and the prior year comparati ves are restated accordingly.

Reporti ng framework

SA Statements of Generally Accepted Accounti ng Practi ce (GAAP) have been withdrawn for fi nancial years com-mencing on or aft er 1 December 2012. Items of Directi ve 05 - Determining the GRAP Reporti ng Framework issued in March 2009, The Accounti ng Standards Board (ASB) has approved the applicati on of Statements of Generally Accepted Accounti ng Practi ce (GAAP), codifi ed by the Accounti ng Practi ces Board (APB) and issued by the South African Insti tute of Chartered Accountants (SAICA) to be GRAP for:

(a) government business enterprises (GBEs)(as defi ned in the PFMA).

The GRAP framework will have to be implemented for the 31 March 2019 year end.

Accounti ng standards, interpretati ons and amendments

During the current fi nancial year, the following accounti ng standards, interpretati ons and amendments were con-sidered by the Enti ty:

IFRS 9, Financial Instruments (amended) Eff ecti ve date - 1 January 2018

IFRS 9 introduced new requirements for classifying and measuring fi nancial assets and liabiliti es. It also contains a new impairment model which will result in earlier recogniti on of losses and new hedging guidance which will require the implementati on of new models, systems and processes. The Enti ty has investi gated the impact of the new rec-ogniti on and measuremet, we do not expect a change.

IFRS 15, Revenue from contracts with customers Eff ecti ve date - 1 January 2018

IFRS 15 requires enti ti es to recognise revenue to depict the transfer of promised goods or services to customers in an amount that refl ects the considerati on to which the enti ty expects to be enti tled in exchange for those goods or services. This core principle is achieved through a fi ve step methodology that is required to be applied to all con-tracts with customers. The Enti ty has investi gated the impact of the new recogniti on and measuremet, we do not expect a change.

IFRS 16, Leases - Eff ecti ve date - 1 January 2019

IFRS 16 provides a single lessee accounti ng model, requiring lessees to recognise assets and liabiliti es for all leases unless the term is 12 months or less or the underlying asset has a low value. Lessors conti nue to classify leases as operati ng or fi nance substanti ally unchanged from its replacement standard IAS 17 Leases. The Enti ty is currently reviewing the lease contracts in place to determine the impact of this standard.

Summary of signifi cant diff erences in the standards of GRAP and IFRS/GAAP

Framework for the Preparati on and Presentati on of Financial Statements

Users and their informati on needs

In the framework, users are described as present and potenti al investors, employees, lenders, suppliers and trade creditors, customers, governments and their agencies and the public.




ACCOUNTING POLICIES

In GRAP users are also described as to include parliament, legislatures and other governing bodies, nati onal and provincial treasuries, fi nancial supporters, rati ng agencies, fi nancial and economic analysts, senior management and other governments.Going concernIn the framework, going concern is based on the assumpti on that an enti ty neither has the intenti on nor the need to liquidate or curtail materially the scale of its operati ons.In GRAP, the fi nancial problems are normally resolved by the ability to raise taxes or some other interventi on. Only in rare cases will acti viti es cease altogether. Assessment of going concern involves judgement on whether the enti ty will conti nue in its present or some modifi ed form.

Financial positi on: Assets

Not applicable to enti ti es applying IFRS as all assets are assumed to contribute to the generati on of future cash fl ows.In GRAP, assets used to deliver goods and services in accordance with the enti ty’s objecti ves but which do not direct-ly generate cash fl ows, are described as having “service potenti al”.Although there may be restricti ons on the enti ty’s use of an asset, unlimited physical control is not necessary for control to be present. It’s the ability to control the rights or access to future economic benefi ts or service potenti al that evidences control over an asset.Financial positi on: Equity (Net assets)In the framework, the residual interest in the assets of an enti ty aft er deducti ng all its liabiliti es is defi ned as equity. Equity refl ect the fact that parti es with ownership interest in an enti ty have diff ering rights in relati on to the receipts of dividends or the repayment of contributed equity.Under GRAP, the residual measure in the statement of fi nancial positi on (assets less liabiliti es), is referred to as “net assets”.Capital maintenance adjustments

Two main concepts of capital maintenance are:

• Financial capital maintenance whereby profi t is earned only of the fi nancial amount of the net assets at the end of the period exceeds the amount at the beginning of the period• Physical capital maintenance whereby profi t is earned only if the physical producti ve capacity at the end of the period exceeds the physical producti ve capacity at the beginning of the period.Not relevant to enti ti es applying GRAP.

GRAP 21: Impairment of non-cash generati ng assets vs No IFRS equivalent

IAS 36 requires the impairment of assets by assessing carrying value against the higher of fair value less costs to sell or value in use. Value in use is based on an analysis of the asset’s discounted cash fl ows.GRAP 21 deals with the impairment of non-cash-generati ng assets which must be diff erenti ated from Cash gener-ati ng assets, those held with the primary objecti ve of generati ng a commercial return. An enti ty needs to establish whether its assets are cash or non-cash generati ng (this might be diff erent for diff erent types of assets). GRAP 21 requires that value in use be determined using depreciated replacement cost, service units approach or restorati on cost.GRAP 23: Revenue from non-exchange transacti ons vs IAS 20: Accounti ng for government grantsand disclosure of government assistance

IAS 20 requires that government grants be recognised in profi t or loss on a systemati c basis over the periods in which the enti ty recognizes as expenses the related costs for which the grants are intended to compensate. A government grant that becomes receivable as compensati on for expenses or losses already incurred or for the purpose of giving immediate fi nancial support to the enti ty with no future related costs shall be recognised in profi t or loss of the period in which it becomes receivable. Government grants related to assets, including non-monetary grants at fair value, shall be presented in the statement of fi nancial positi on either by setti ng up the grant as deferred income or by deducti ng the grant in arriving at the carrying amount of the asset.




ACCOUNTING POLICIES

GRAP 24: Presentati on of budget informati on vs No IFRS equivalent

No equivalent standard under IFRS/GAAP.GRAP 24 must be applied by enti ti es that are required or elect to make publicly available their approved bud-gets when presenti ng budget informati on for consolidati on process. The standard requires a comparison of budget amounts and the actual amounts arising from the executi on of the budget to be included in the fi nancial statements. It requires disclosure of explanati on of material diff erences between the budget and actual amounts. There are no journal entries required.

GRAP 104 vs IAS 32, 39, IFRS 7 and 9: Financial instruments

Classifi cati onIFRS classifi es fi nancial assets as fi nancial assets at fair value through profi t or loss; fi nancial instruments at cost, held-to-maturity investments; loans and receivables; and available-for-sale fi nancial assets; and fi nancial liabiliti es as fi nancial liabiliti es at fair value through profi t or loss and those at amorti sed cost. GRAP classifi es fi nancial instruments as fi nancial instruments at fair value including fi nancial assets/liabiliti es desig-nated at fair value, fi nancial instruments at amorti sed cost; and fi nancial instruments at cost.

GRAP 1 vs IAS 1: Presentati on of fi nancial statements

There are diff erences between GRAP 1 and IAS 1 that highlight the public sector bias of the standards of GRAP. These diff erences include terminology diff erences, e.g. the statement of profi t or loss and other comprehensive income is referred to as the statement of fi nancial performance; the statement of changes in equity for the period, the statement of changes in net assets, new concepts such as service potenti al and the requirement to present budget informati on as a separate statement if the basis of preparing budget informati on is not the same as the GRAP basis.IAS 1 an enti ty applies an accounti ng policy retrospecti vely or makes a retrospecti ve restatement in its fi nancial statements, the enti ty presents a statement of fi nancial positi on as at the end of the current period, previous period and at the beginning of the earliest comparati ve period and requirement not included in GRAP 1.

GRAP 2 vs IAS 7: Cash fl ow statements

The principles of GRAP 2 are consistent with IAS 7, although there are diff erences in terminology consistent with those discussed in the presentati on secti on above. The diff erence worth noti ng is in the presentati on of the cash fl ow statement, whereby GRAP 2 eliminates the use of the indirect method, whereby net surplus or defi cit is ad-justed for the eff ects of transacti ons. The following disclosures are encouraged in IAS 7: • Aggregate amount of cash fl ows that represent increases in operati ng capacity separately from those required to maintain operati ng capacity • Cash fl ows arising from the operati ng, investi ng and fi nancing acti viti es of each reportable segment. However dis-closures are not included in GRAP 2.

GRAP 12 vs IAS 2: Inventories

IFRS does not have specifi c requirements for assets (PPE, inventory, intangibles, etc.) that are acquired for no con-siderati on. Inventory is subsequently measured at the lower of cost and net realisable value.Standards of GRAP require that assets acquired at no or nominal considerati on be recognised at fair value. Inventory is subsequently measured at the lower of cost and current replacement cost.

GRAP 13 vs IFRS 16: Leases

The standard of GRAP, consistent with IFRS 16, requires that discount rate used at initi al recogniti on of a fi nance lease to calculate the present value of the minimum lease payments to be the rate implicit in the lease. When the lessee’s incremental borrowing rate is used because the rate implicit in the lease is impracti cable to determine; the lessee shall take into account any borrowings which are guaranteed by the government to adjust the incremental borrowing rate accordingly.

The standard of GRAP also specifi cally allows enti ti es to disclose depreciati on and the fi nance charge relati ng to the leased asset as part of the total depreciati on and fi nance charges respecti vely.




ACCOUNTING POLICIES

GRAP 16 vs IAS 40: Investment propertyThe standards are consistent in terms of the principles; however GRAP provides specifi c guidance regarding property that is used to provide housing as a social service, whereby such a property does not qualify as investment property although rentals are earned during transacti on. Additi onal public sector specifi c scenario relates to when the invest-ment property is acquired at no cost, or for a nominal cost, whereby the fair value as at the date of acquisiti on will be deemed as the cost.

GRAP 17 vs IAS 16: Property, plant and equipment IFRS does not have specifi c requirements for assets (PPE, inventory, etc.) that are acquired for no considerati on. Standards of GRAP require that assets acquired at no or nominal considerati on be recognised at fair value.

GRAP 20 vs IAS 24: Related party disclosures

IFRS requires enti ti es that have transacti ons and balances with related parti es to disclose the nature of the related party relati onship, informati on about outstanding balances for the user to understand the potenti al eff ect of the relati onship on the fi nancial statements. Public sector enti ti es transact with one another on a daily basis, these transacti ons may occur at cost, less than cost or free of charge.

GRAP 102 vs IAS 38: Intangible assets.

IFRS does not have specifi c requirements for assets (intangibles, etc.) that are acquired for no considerati on. Stan-dards of GRAP require that assets acquired at no or nominal considerati on be recognised at fair value.

GRAP 5 vs IAS 23: Borrowing costs

Expenditures on qualifying assets are reduced by any progress payments received and grants received in connecti on with the asset. Commencement of capitalisati on is not included in GRAP 5.

GRAP 9 vs IFRS 15: Revenue from exchange transacti ons

There is no split between exchange and non-exchange transacti ons, ...

GRAP 25 vs IAS 19: Employee benefi ts

GRAP 3 vs IAS 8: Accounti ng Policies, Changes in Accounti ng Esti mates and Errors

GRAP 14 vs IAS 10: Events aft er the reporti ng date,

GRAP 19 vs IAS 37: Provisions, conti ngent liabiliti es and conti ngent assets,

GRAP 26 vs IAS 36: Impairment of cash-generati ng assets, and

GRAP 100 vs IFRS 5: Non-current assets held for sale and disconti nued operati ons.

Mjindi Farming analysis and comparisons between the standards of GRAP and IFRS has been found that, the princi-ples between GRAP and IFRS for the above menti oned standards are consistent with minor diff erences in terminol-ogy to accommodate for public sector specifi c transacti ons,




ACCOUNTING POLICIES

1.1 Signifi cant judgements and sources of esti mati on uncertainty

The preparati on of annual fi nancial statements in conformity with South African Statements of Generally Accepted Accounti ng Practi ce requires management, from ti me to ti me, to make judgements, esti mates and assumpti ons that aff ect the applicati on of policies and reported amounts of assets, liabiliti es, income and expenses. These esti mates and associated assumpti ons are based on experience and various other factors that are believed to be reasonable under the circumstances. Actual results may diff er from these esti mates. The esti mates and underlying assumpti ons are reviewed on an ongoing basis. Revisions to accounti ng esti mates are recognised in the period in which the esti -mates are revised and in any future periods aff ected.

Trade receivables and impairment testi ng

The enti ty assesses its trade receivables for impairment at the end of each reporti ng period. In determining whether an impairment loss should be recorded in profi t or loss, the enti ty makes judgements as to whether there is observ-able data indicati ng a measurable decrease in the esti mated future cash fl ows from the fi nancial asset.

The impairment (or loss allowance) for trade receivables is calculated based on the accounti ng policy and when there is evidence that the company will not be able to collect all amounts due according to the original terms of receivable. Trade receivables are recovered by means of cash received or by way of cession signed with the sugar millers against the respecti ve growers sugar cane crops .

The enti ty reviews and tests the carrying value of assets when events or changes in circumstances suggest that the carrying amount may not be recoverable. Assets are grouped at the lowest level for which identi fi able cash fl ows are largely independent of cash fl ows of other assets and liabiliti es. If there are indicati ons that impairment may have occurred, esti mates are prepared of expected future cash fl ows for each group of assets. Expected future cash fl ows used to determine the value in use of tangible assets are inherently uncertain and could materially change over ti me. They are signifi cantly aff ected by a number of factors together with economic factors such as infl ati on and interest rate.

Useful life of property, plant and equipment

Management assess the appropriateness of the useful lives of property, plant and equipment at the end of each reporti ng period. The useful lives of motor vehicles, furniture and computer equipment are determined based on company replacement policies for the various assets. Individual assets within these classes, which have a signifi cant carrying amount are assessed separately to consider whether replacement will be necessary outside of normal re-placement parameters.

When the esti mated useful life of an asset diff ers from previous esti mates, the change is applied prospecti vely in the determinati on of the depreciati on charge.

Provisions

Provisions were raised and management determined an esti mate based on the informati on available. Additi onal disclosure of these esti mates of provisions are included in note 6 - Provisions. Provisions are measured at manage-ment’s best esti mate of the expenditure required to sett le the obligati on at the reporti ng date, and are discounted to present value where the eff ect is material.

1.2 Investment property

Investment property is recognised as an asset when, and only when, it is probable that the future economic benefi ts that are associated with the investment property will fl ow to the enti ty, and the cost of the investment property can be measured reliably.

Investment property is initi ally recognised at cost. Transacti on costs are included in the initi al measurement.




ACCOUNTING POLICIES

1.2 Investment property (conti nued)

Cost model

Investment property is carried at cost less depreciati on less any accumulated impairment losses.

Depreciati on is provided to write down the cost, less esti mated residual value of 10% over the useful life of the property, which is as follows:

Impairment tests are performed on investment property when there is an indicator that they may be impaired. When the carrying amount of an item of investment property is assessed to be higher than the esti mated recover-able amount, an impairment loss is recognised immediately in profi t or loss to bring the carrying amount in line with the recoverable amount.

Item Useful lifeProperty - buildings 60 years

1.3 Property, plant and equipment

Property, plant and equipment are tangible assets which the company holds for its own use or for rental to others and which are expected to be used for more than one year.

An item of property, plant and equipment is recognised as an asset when it is probable that future economic benefi ts associated with the item will fl ow to the company, and the cost of the item can be measured reliably.

Property, plant and equipment is initi ally measured at cost. Cost includes all of the expenditure which is directly at-tributable to the acquisiti on or constructi on of the asset, including the capitalisati on of borrowing costs on qualifying assets and adjustments in respect of hedge accounti ng, where appropriate.

Expenditure incurred subsequently for major services, additi ons to or replacements of parts of property, plant and equipment are capitalised if it is probable that future economic benefi ts associated with the expenditure will fl ow to the company and the cost can be measured reliably. Day to day servicing costs are included in profi t or loss in the year in which they are incurred.

Major inspecti on costs which are a conditi on of conti nuing use of an item of property, plant and equipment and which meet the recogniti on criteria are included as a replacement in the cost of the item of property, plant and equipment. Any remaining inspecti on costs from the previous inspecti on are derecognised.

Major spare parts and stand by equipment which are expected to be used for more than one year are included in property, plant and equipment.

Subsequent to initi al recogniti on, plant and equipment is measured at cost less accumulated depreciati on and any accumulated impairment losses, except for property which are stated at revalued amounts. The revalued amount is the fair value at the date of revaluati on less any subsequent accumulated depreciati on and impairment losses.

Property is subsequently stated at revalued amount, being the fair value at the date of revaluati on less any subse-quent accumulated depreciati on and subsequent accumulated impairment losses.

Revaluati ons are made with suffi cient regularity such that the carrying amount does not diff er materially from that which would be determined using fair value at the end of the reporti ng year.

When an item of property is revalued, the gross carrying amount is adjusted consistently with the revaluati on of the carrying amount. The accumulated depreciati on at that date is adjusted to equal the diff erence between the gross carrying amount and the carrying amount aft er taking into account accumulated impairment losses.

When an item of property is revalued, any accumulated depreciati on at the date of the revaluati on is eliminated against the gross carrying amount of the asset.

Any increase in an asset’s carrying amount, as a result of a revaluati on, is recognised in other comprehensive income and accumulated in the revaluati on reserve in equity. The increase is recognised in profi t or loss to the extent that it reverses a revaluati on decrease of the same asset previously recognised in profi t or loss.




ACCOUNTING POLICIES

1.3 Property, plant and equipment (conti nued)

Any decrease in an asset’s carrying amount, as a result of a revaluati on, is recognised in profi t or loss in the current year. The decrease is recognised in other comprehensive income to the extent of any credit balance existi ng in the revaluati on reserve in respect of that asset. The decrease recognised in other comprehensive income reduces the amount accumulated in the revaluati on reserve in equity.

The revaluati on reserve related to a specifi c item of property is transferred directly to accumulated surplus as the asset is derecognised. The amount transferred is equal to the diff erence between depreciati on based on the reval-ued carrying amount and depreciati on based on the original cost of the asset.

Depreciati on of an asset commences when the asset is available for use as intended by management. Depreciati on is charged to write off the asset’s carrying amount over its esti mated useful life to its esti mated residual value (various residual value percentages), using a method that best refl ects the patt ern in which the asset’s economic benefi ts are consumed by the company. Leased assets are depreciated in a consistent manner over the shorter of their expected useful lives and the lease term. Depreciati on is not charged to an asset if its esti mated residual value exceeds or is equal to its carrying amount. Depreciati on of an asset ceases at the earlier of the date that the asset is classifi ed as held for sale or derecognised.

The useful lives of items of property, plant and equipment have been assessed as follows:

Item Depreciati on method Average useful life

Trailers Straight line 20 YearsLeasehold property Straight line Over the lease agreement termBuildings Straight line 50 YearsWorkshop equipment and Implements Straight line 10 YearsMotor vehicles Straight line 8 YearsFences, Gates, and Water provision equipment Straight line 10 YearsOffi ce equipment, household furniture and air conditi oners Straight line 10 YearsComputer equipment Straight line 5 YearsOffi ce Furniture, Adverti sing boards and Building upgrade Straight line 15 YearsTractors Straight line 15 YearsSundry equipment Straight line 10 - 20 Years

The residual value, useful life and depreciati on method of each asset are reviewed at the end of each reporti ng year. If the expectati ons diff er from previous esti mates, the change is accounted for prospecti vely as a change in account-ing esti mate.

Each part of an item of property, plant and equipment with a cost that is signifi cant in relati on to the total cost of the item is depreciated separately.

The depreciati on charge for each year is recognised in profi t or loss unless it is included in the carrying amount of another asset.

Impairment tests are performed on property, plant and equipment when there is an indicator that they may be impaired. When the carrying amount of an item of property, plant and equipment is assessed to be higher than the esti mated recoverable amount, an impairment loss is recognised immediately in profi t or loss to bring the carrying amount in line with the recoverable amount.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefi ts are expected from its conti nued use or disposal. Any gain or loss arising from the derecogniti on of an item of property, plant and equipment, determined as the diff erence between the net disposal proceeds, if any, and the carrying amount of the item, is included in profi t or loss when the item is derecognised.




ACCOUNTING POLICIES

1.4 Intangible assets

An intangible asset is recognised when:

• it is probable that the expected future economic benefi ts that are att ributable to the asset will fl ow to the enti ty;

• and the cost of the asset can be measured reliably.

Intangible assets are initi ally recognised at cost.

Expenditure on research (or on the research phase of an internal project) is recognised as an expense when it is incurred.

An intangible asset arising from development (or from the development phase of an internal project) is recognised when:

• it is technically feasible to complete the asset so that it will be available for use or sale.

• there is an intenti on to complete and use or sell it.

• there is an ability to use or sell it.

• it will generate probable future economic benefi ts.

• there are available technical, fi nancial and other resources to complete the development and to use or sell the asset.

• the expenditure att ributable to the asset during its development can be measured reliably.

Intangible assets are carried at cost less any accumulated amorti sati on and any impairment losses.

An intangible asset is regarded as having an indefi nite useful life when, based on all relevant factors, there is no foreseeable limit to the period over which the asset is expected to generate net cash infl ows. Amorti sati on is not provided for these intangible assets, but they are tested for impairment annually and whenever there is an indica-ti on that the asset may be impaired. For all other intangible assets amorti sati on is provided on a straight line basis over their useful life.

The amorti sati on period and the amorti sati on method for intangible assets are reviewed every period-end.

Reassessing the useful life of an intangible asset with a fi nite useful life aft er it was classifi ed as indefi nite is an in-dicator that the asset may be impaired. As a result the asset is tested for impairment and the remaining carrying amount is amorti sed over its useful life.

Internally generated brands, mastheads, publishing ti tles, customer lists and items similar in substance are not rec-ognised as intangible assets.

Amorti sati on is provided to write down the intangible assets, on a straight line basis, to their residual values as fol-lows:

Item Useful life

Intangible asset 5 years

1.5 Financial instruments

Classifi cati on

The enti ty classifi es fi nancial assets and fi nancial liabiliti es into the following categories:

• Financial assets at fair value through profi t or loss - held for trading

• Loans and receivables

Classifi cati on depends on the purpose for which the fi nancial instruments were obtained / incurred and takes place at initi al recogniti on. Classifi cati on is re-assessed on an annual basis, except for derivati ves and fi nancial assets des-ignated as at fair value through profi t or loss, which shall not be classifi ed out of the fair value through profi t or loss category.

Initi al recogniti on and measurement

Financial instruments are recognised initi ally when the enti ty becomes a party to the contractual provisions of the instruments.




ACCOUNTING POLICIES

1.5 Financial instruments (Cont...)

The enti ty classifi es fi nancial instruments, or their component parts, on initi al recogniti on as a fi nancial asset, a fi -nancial liability or an equity instrument in accordance with the substance of the contractual arrangement.Financial instruments are measured initi ally at fair value. For fi nancial instruments which are not at fair value through profi t or loss, transacti on costs are included in the initi al measurement of the instrument.Transacti on costs on fi nancial instruments at fair value through profi t or loss are recognised in profi t or loss.

Subsequent measurement

Financial instruments at fair value through profi t or loss are subsequently measured at fair value, with gains and losses arising from changes in fair value being included in profi t or loss for the period.Impairment of fi nancial assets

At each reporti ng date the enti ty assesses all fi nancial assets, other than those at fair value through profi t or loss, to determine whether there is objecti ve evidence that a fi nancial asset or group of fi nancial assets has been impaired.For amounts due to the enti ty, signifi cant fi nancial diffi culti es of the debtor, probability that the debtor will enter bankruptcy and default of payments are all considered indicators of impairment.Impairment losses are recognised in surplus or defi cit.Impairment losses are reversed when an increase in the fi nancial asset’s recoverable amount can be related objec-ti vely to an event occurring aft er the impairment was recognised, subject to the restricti on that the carrying amount of the fi nancial asset at the date that the impairment is reversed shall not exceed what the carrying amount would have been had the impairment not been recognised.Reversals of impairment losses are recognised in surplus or defi cit.Where fi nancial assets are impaired through use of an allowance account, the amount of the loss is recognised in profi t or loss within operati ng expenses. When such assets are writt en off , the write off is made against the rele-vant allowance account. Subsequent recoveries of amounts previously writt en off are credited against operati ng expenses.

Credit Risk

Credit risk is the risk of fi nancial loss to the enti ty when the customer or counter party to the fi nancial instrument fails to meet its contractual obligati ons and arises principally from the enti ty’s receivables from customers. In order to minimise the potenti al for loss, the enti ty has adopted a credit risk management philosophy, which is based on the principle of assessing the repayment of individual farmers account and the recoverability of such debt through the cash fl ows. It is also managed by entering into contractual agreements that indicate payment required of the services rendered. There has been no substanti al change in this risk from the previous period.

Trade and other receivables

Trade receivables are measured at fair value through profi t or loss .

Trade and other payables

Trade payables are initi ally measured at fair value, and are subsequently measured at amorti sed cost, using the ef-fecti ve interest rate method.

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and demand deposits, and other short-term highly liquid invest-ments that are readily converti ble to a known amount of cash and are subject to an insignifi cant risk of changes in value. These are initi ally and subsequently recorded at fair value.

Liquidity Risk

Liquidity risk is the risk that the enti ty will not be able to meet its fi nancial obligati ons as they fall due. The enti ty’s approach in managing liquidity risk is to ensure, as far as possible , that it will always have suffi cient liquidity to meet its liabiliti es when due, without incurring unacceptable losses or risking damage to the enti ty’s reputati on. The enti -ty has adequate funding sources to service its fi nancial liabiliti es.




ACCOUNTING POLICIES

1.6 Taxati on

No provision has been made for taxati on as the enti ty acts as an agent for the Provincial Department of Agriculture and Rural Development, KwaZulu-Natal and has therefore been exempted from income tax.

1.7 Leases

A lease is classifi ed as a fi nance lease if it transfers substanti ally all the risks and rewards incidental to ownership. A lease is classifi ed as an operati ng lease if it does not transfer substanti ally all the risks and rewards incidental to ownership.

Finance leases – lessee

Finance leases are recognised as assets and liabiliti es in the statement of fi nancial positi on at amounts equal to the fair value of the leased property or, if lower, the present value of the minimum lease payments. The corresponding liability to the lessor is included in the statement of fi nancial positi on as a fi nance lease obligati on.

The discount rate used in calculati ng the present value of the minimum lease payments is the interest rate implicit in the lease.

The lease payments are apporti oned between the fi nance charge and reducti on of the outstanding liability.The fi nance charge is allocated to each period during the lease term so as to produce a constant periodic rate on the remaining balance of the liability.

Operati ng leases – lessee

Operati ng lease payments are recognised as an expense on a straight-line basis over the lease term. The diff erence between the amounts recognised as an expense and the contractual payments are recognised as an operati ng lease asset. This liability is not discounted.

Any conti ngent rents are expensed in the period they are incurred.

1.8 Inventories

Inventories are measured at the lower of cost and net realisable value on determined on the average cost basis for diesel.

Inventories are measured at the lower of cost and net realisable value on the fi rst-in-fi rst-out basis for spare part.

Net realisable value is the esti mated selling price in the ordinary course of business less the esti mated costs of com-pleti on and the esti mated costs necessary to make the sale.

The cost of inventories comprises of all costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present locati on and conditi on.

1.9 Impairment of assets

The enti ty assesses at each end of the reporti ng period whether there is any indicati on that an asset may be im-paired. If any such indicati on exists, the enti ty esti mates the recoverable amount of the asset.

Irrespecti ve of whether there is any indicati on of impairment, the enti ty also:

• tests intangible assets with an indefi nite useful life or intangible assets not yet available for use for impairment annually by comparing its carrying amount with its recoverable amount. This impairment test is performed during the annual period and at the same ti me every period.

• tests goodwill acquired in a business combinati on for impairment annually.

If there is any indicati on that an asset may be impaired, the recoverable amount is esti mated for the individual as-set. If it is not possible to esti mate the recoverable amount of the individual asset, the recoverable amount of the cash-generati ng unit to which the asset belongs is determined.

The recoverable amount of an asset or a cash-generati ng unit is the higher of its fair value less costs to sell and its value in use.




ACCOUNTING POLICIES

1.9 Impairment of assets (conti nued)

If the recoverable amount of an asset is less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. That reducti on is an impairment loss.

An impairment loss of assets carried at cost less any accumulated depreciati on or amorti sati on is recognised imme-diately in profi t or loss. Any impairment loss of a revalued asset is treated as a revaluati on decrease.

An enti ty assesses at each reporti ng date whether there is any indicati on that an impairment loss recognised in prior periods for assets other than goodwill may no longer exist or may have decreased. If any such indicati on exists, the recoverable amounts of those assets are esti mated.

The increased carrying amount of an asset other than goodwill att ributable to a reversal of an impairment loss does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in prior periods.

A reversal of an impairment loss of assets carried at cost less accumulated depreciati on or amorti sati on other than goodwill is recognised immediately in profi t or loss. Any reversal of an impairment loss of a revalued asset is treated as a revaluati on increase.

1.10 Share capital and equity

An equity instrument is any contract that evidences a residual interest in the assets of an enti ty aft er deducti ng all of its liabiliti es.

1.11 Employee benefi ts

Short-term employee benefi ts

The cost of short-term employee benefi ts, (those payable within 12 months aft er the service is rendered, such as paid vacati on leave and sick leave, bonuses, and non-monetary benefi ts such as medical care), are recognised in the period in which the service is rendered and are not discounted.

The expected cost of compensated absences is recognised as an expense as the employees render services that increase their enti tlement or, in the case of non-accumulati ng absences, when the absence occurs.

The expected cost of profi t sharing and bonus payments is recognised as an expense when there is a legal or con-structi ve obligati on to make such payments as a result of past performance.

Defi ned contributi on plans

Multi kor Pension Fund Payments to defi ned contributi on reti rement benefi t plans are charged as an expense as they fall due.

The employees of the enti ty make monthly contributi ons towards the Multi kor Pension Fund and an amount is dis-closed regarding the enti ty’s porti on of the monthly contributi ons.

Payments to defi ned contributi on reti rement benefi t plans are charged as an expense as they fall due.

Payments made to industry-managed (or state plans) reti rement benefi t schemes are dealt with as defi ned contri-buti on plans where the enti ty’s obligati on under the schemes is equivalent to those arising in a defi ned contributi on reti rement benefi t plan.

The enti ty belonged to a defi ned contributi on scheme and not a defi ned benefi t scheme and the contributi on level the employer uti lises various rates of the pensionable salaries depending on the ti mes that the pensionable salary will be received and all benefi ts comes from this as well as the member’s contributi on of 7.5%.

1.12 Provisions and conti ngencies

Provisions are recognised when:

• the enti ty has a present obligati on as a result of a past event;

• it is probable that an outf low of resources embodying economic benefi ts will be required to sett le the obliga-ti on; and

• a reliable esti mate can be made of the obligati on.




ACCOUNTING POLICIES

1.12 Provisions and conti ngencies (conti nued)

The amount of a provision is the present value of the expenditure expected to be required to sett le the obligati on. Provisions are not recognised for future operati ng losses.

1.13 Government grants

Government grants are recognised when there is reasonable assurance that:

• the company will comply with the conditi ons att aching to them; and

• the grants will be received.

Government grants are recognised as income over the periods necessary to match them with the related costs that they are intended to compensate.

A government grant that becomes receivable as compensati on for expenses or losses already incurred or for the purpose of giving immediate fi nancial support to the enti ty with no future related costs is recognised as income of the period in which it becomes receivable.

Government grants related to assets, including non-monetary grants at fair value, are presented in the statement of fi nancial positi on by setti ng up the grant as deferred income or by deducti ng the grant in arriving at the carrying amount of the asset.

Grants related to income are presented as a credit in the profi t or loss (separately).

Repayment of a grant related to income is applied fi rst against any un-amorti sed deferred credit set up in respect of the grant. To the extent that the repayment exceeds any such deferred credit, or where no deferred credit exists, the repayment is recognised immediately as an expense.

Repayment of a grant related to an asset is recorded by increasing the carrying amount of the asset or reducing the deferred income balance by the amount repayable. The cumulati ve additi onal depreciati on that would have been recognised to date as an expense in the absence of the grant is recognised immediately as an expense.

1.14 Revenue

Revenue is measured at the fair value of the considerati on received or receivable and represents the amounts receivable for goods and services provided in the normal course of business, net of trade discounts and volume re-bates, and value added tax. Revenue is recognised when it is probable that future economic benefi ts will fl ow to the enti ty and these benefi ts can be measured reliably.

Water supply services and rental income

Sales are recognised at the date services are provided net of value-added tax and discounts, if any.

Transfers and subsidies

Monetary government grants are received from the Department of Agriculture and Rural Development Kwa-Zulu Natal, and are recognized as income over periods necessary to match them with the related costs which they are intended to compensate in terms of the mandate from the shareholder, on a systemati c basis. They are not credited directly to shareholders’ interest. Monetary government grants received are not refundable to the Department and are uti lized to cover operati onal and overhead expenditure. Unexpended funds arising at year end are carried for-ward to the following year. Also refer to note .

Interest received

Interest is recognised, in surplus or defi cit, using the eff ecti ve interest rate method.

1.15 Borrowing costs

Borrowing costs that are directly att ributable to the acquisiti on, constructi on or producti on of a qualifying asset are capitalised as part of the cost of that asset unti l such ti me as the asset is ready for its intended use. The amount of borrowing costs eligible for capitalisati on is determined as follows:

• Actual borrowing costs on funds specifi cally borrowed for the purpose of obtaining a qualifying asset less any temporary investment of those borrowings.




ACCOUNTING POLICIES

1.15 Borrowing costs (Cont...)

• Weighted average of the borrowing costs applicable to the enti ty on funds generally borrowed for the purpose of obtaining a qualifying asset. The borrowing costs capitalised do not exceed the total borrowing costs incurred.

The capitalisati on of borrowing costs commences when:

• expenditures for the asset have occurred;

• borrowing costs have been incurred, and

• acti viti es that are necessary to prepare the asset for its intended use or sale are in progress.

Capitalisati on is suspended during extended periods in which acti ve development is interrupted.

Capitalisati on ceases when substanti ally all the acti viti es necessary to prepare the qualifying asset for its intended use or sale are complete.

All other borrowing costs are recognised as an expense in the period in which they are incurred.

1.16 Related party

Related party

Parti es are considered to be related to the enti ty if they have the ability to control or exercise signifi cant infl uence over the enti ty (or vice versa) in making fi nancial and operati onal decisions or if both parti es are subject to com-mon control. Related party relati onships where control exists are disclosed irrespecti ve of whether there have been transacti ons between the related parti es. Related party disclosures for transacti ons that took place on terms and conditi ons considered to be “at arms length” and “in the ordinary course of business” are not disclosed. All other transacti ons with related parti es not considered to be “in the ordinary course of business” are disclosed in accor-dance with IAS 24: “Related Party Disclosures”.

1.17 Irregular expenditure

Irregular expenditure as defi ned is secti on 1 of the PFMA is expenditure other than unauthorised expenditure, incurred in contraventi on of or that is not according with the requirement of any applicable legislati on including this act or the State Tender Board Act, 1968, or any provincial legislati on providing procurement procedure in that provincial government.

1.18 Fruitless and wasteful expenditure

Fruitless and wasteful expenditure means expenditure which was made in vain and would have been avoided had reasonable care been exercised

1.19 Budget informati on

The approved budget has been prepared on a cash basis and presented by economic classifi cati on linked to perfor-mance outcome objecti ves.

Approved budget covers the fi scal period from 01/04/2017 to 31/03/2018.

The fi nancial statements are on an accrual basis and budget on a cash basis of accounti ng therefore a comparison with the budgeted amounts for the reporti ng period have been included in the comparison of the budget and cash amounts




NOTES TO THE ANNUAL FINANCIAL STATEMENTS

Figures in Rand 20182017

Restated

2. Investment property

2018 2017

Cost / Valuati on

Accumulateddepreciati on

Carrying value

Cost /Valuati on


Carrying value

Investment property 2,875,775 (420,747) 2,455,028 2,875,775 (377,610) 2,498,165

Reconciliati on of investment property - 2018

Opening Balance Depreciati on Total

Investment property 2,498,165 (43,137) 2,455,028

Reconciliati on of investment property - 2017 restated

Opening Balance Depreciati on Total

Investment property 2,552,992 (54,827) 2,498,165

Amounts recognised in surplus for the year

Rental income from investment property 200,068 252,674

3. Property, plant and equipment

2018 2017

Cost / Revaluati on


Carrying value

Cost /Revaluati on


Carrying value

Buildings 23,943,000 - 23,943,000 20,138,163 (2,220,396) 17,917,767

Fences and gates, boards and water provision

3,002,654 (1,598,919) 1,403,735 2,991,322 (1,300,897) 1,690,425

Finance lease assets 191,849 (135,473) 56,376 198,231 (152,938) 45,293

Building upgrade 599,129 (128,699) 470,430 431,638 (97,395) 334,243

Offi ce furniture 859,063 (340,159) 518,904 859,063 (292,689) 566,374

Tractors, motor vehicles and Trailors

18,350,783 (3,743,468) 14,607,315 18,350,783 (2,873,512) 15,477,271

Offi ce equipment and household furniture

808,118 (419,256) 388,862 808,118 (349,052) 459,066

Computer equipment 2,325,598 (1,842,195) 483,403 2,216,527 (1,751,823) 464,704

Workshop equipment and implements

4,844,781 (1,286,300) 3,558,481 4,312,804 (932,807) 3,379,997

Sundry equipment 13,432,202 (3,317,540) 10,114,662 12,690,485 (2,621,434) 10,069,051

Total 68,357,177 (12,812,009) 55,545,168 62,997,134 (12,592,943) 50,404,191


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Restated

3. Property, plant and equipment (conti nued)

Disposal of property, plant and equipment

Carrying value of property, plant and equipment - 20,245

Loss of property, plant and equipment - (228)

Profi t of property, plant and equipment - 18,601

- 38,618

The assets at nil and R1 are sti ll being uti lised by the enti ty.

4. Intangible assets

2018 2017

Cost / Valuati on


Carrying value

Cost /Valuati on


Carrying value

Intangible assets 327,120 (327,119) 1 327,120 (261,872) 65,248

Reconciliati on of intangible assets - 2018

Opening Balance Amorti sati on Total

Intangible assets 65,248 (65,247) 1

Reconciliati on of intangible assets - 2017 restated

Opening Balance restated

Amorti sati on Total

Intangible assets 130,672 (65,424) 65,248

5. Inventories

Consumables 69,323 139,288

Spare parts 3,040,053 2,802,711

3,109,376 2,941,999

Diesel writt en off - (6,632)

Spare parts writt en off - (344,232)

3,109,376 2,591,135

Inventories comprising diesel valued at the lower of cost or net realizable value determined on the average cost basis and spare parts valued at the lower of cost and net realizable value determined on the fi rst in fi rst out basis. Cost in-cludes all costs incurred in bringing inventories to their present locati on and conditi on. Provision is made against slow and obsolete stock.






Restated

6. Trade and other receivables

Trade receivables 19,686,236 16,580,745

Less: Provision for allowances for credit losses (10,727,413) (8,844,986)

Deposits 2,144,165 1,997,182

VAT - 346,852

11,102,988 10,079,793

Trade receivables is made up of the following:

Water charges 19,241,734 16,246,225

Accommodati on 159,489 90,094

Business 265,786 190,360

Staff 2,186 1,745

Other 17,041 52,321

19,686,236 16,580,745

Reconciliati on of provision for allowances for credit losses of trade and other receivables

Opening balance 8,844,986 4,792,918

Movements 1,882,427 4,052,068

10,727,413 8,844,986

7. Cash and cash equivalents

Cash and cash equivalents consist of:Pett y cash on hand - 3,450

First Nati onal Bank – Money market account 6,821,553 5,143,262

First Nati onal Bank – Current account 246,038 367,271

First Nati onal Bank – Call account 8,387 6,658

First Nati onal Bank – Management account 9,455 8,375

7,085,433 5,529,016

8. Share capital

The below shares are held by the Provincial Department of Agriculture and Rural Development, KwaZulu-Natal.

Authorised and Issued100 ordinary shares of R1 each 100 100






Restated

9. Revaluati on reserve

The reserve arose from the revaluati on of properti es, the latest revaluati on was conducted in March 2018 and fair valuing of all the enti ti es assets that are in use.

Revaluati on reserve arises from gains made from the periodic revaluati on of assets to their fair the value on the re-valuati on date. The reserve is transferred directly to retained earnings upon disposal of the asset. If revalued asset is impaired the loss will fi rst be set off against any available revaluati on reserve before being expensed in the statement of profi t and loss and other comprehensive income.

Opening balance 21,724,915 21,724,915

Movements 6,387,724 -

28,112,639 21,724,915

10. Capitalisati on reserve

The below represents the contributi on by the Department in their capacity as owners.


11, Rent deposits

Rent deposits 8,286 -

12. Finance lease liabiliti es

Minimum lease payments due

- within one year 26,005 21,292

- in second to fi ft h year 14,387 19,559

Present value of minimum lease payments 40,392 40,851

The enti ty has leased certain equipment over a fi nance lease from Vodacom South Africa. The lease is for the period of 2 years with monthly lease installments and interest rate is linked to prime interest rate. The fi nance lease balance was made up of a total of 12 devices as follows:

Rueter - 5 devices

Samsung Galaxy S7 - 2 Devices

Samsung Galaxy A5 LTE - 1 Device

I-Phone 6 - 3 Devices

Samsung Galaxy Tab a 10.1 with S-Pen - 6 Devices

The average lease term was 2 years and the average eff ecti ve borrowing rate is linked to the prime rate as determined by the South African Reserve Bank. Interest rates are linked to prime at the contract date. All leases have fi xed repay-ments and no arrangements have been entered into for conti ngent rent.






Restated

13. Trade and other payables

Trade payables 3,706,806 534,677

Value Added tax 106,207 -

Pay as you earn 41,293 21,606

Workman compensati on 408,434 522,958

4,262,740 1,079,241

14. Accrual

Salaries 145 7,426

15. Provision for leave

Opening carrying amount 804,921 780,990

Movements (21,862) 23,931

783,059 804,921

16. Revenue

Water Charges 4,841,916 4,984,865

Rental income 262,112 316,150

5,104,028 5,301,015

The amount included in revenue arising from exchanges of goods or services included in revenue are as follows:

Grant received during the year 56,001,000 53,180,000

Grant not yet received - 3,000

Less: Output Value Added Tax (6,877,316) (6,531,246)

49,123,684 46,651,754

17. Other operati ng income

Sundry Income 18,256 60,463

Rental implements 97,000 160,430

Proceeds from insurance 198,198 1,500

Nursery Income 800 105

Debtors interest 1,838,855 1,651,515

Profi t on disposal of assets - 18,601

2,153,109 1,892,614






Restated

18. Investment income

Interest Eskom 128,972 88,697

Interest Money market 270,640 473,705

399,612 562,402

Debtors interest relate to the interest that is charged on the outstanding debtors balance monthly.

19. Finance costs

Interest Finance Lease 4,100 6,565

Interest cheque account 13 -

SARS penalies and interest 3,504 3,106

7,617 9,671

20. Operati ng surplus

Operati ng surplus/(loss) for the year is stated aft er accounti ng for the following:Auditors remunerati on - external auditors (1,533,997) (1,226,979)

Decrease / (increase) in allowance for credit losses (1,882,427) (4,052,068)

Depreciati on (2,913,566) (3,187,992)

Amorti sati on (65,247) (65,424)

(2,978,813) (3,253,416)

Directors fees

Directors fees (533,939) (313,057)

Directors costs (319,334) (292,874)

(853,273) (605,931)

Profi t on sale of assets - 18,601

Loss on sale of assets - (228)

- 18,373






Restated

Professional fees (329,365) (163,713)


Write off - inventory - (344,232)

Salaries and wages (16,535,228) (16,281,286)

Employee costs

- Cellphone allowance (48,500) (57,000)

- Housing allowance (483,022) (507,209)

- Medical (482,821) (468,549)

- Pension (2,116,476) (2,114,881)

- Skills development levy (177,411) (172,740)

- Subsidy vehicle allowance (423,500) (494,400)

- Unemployment insurance fund (107,293) (109,238)

(3,839,023) (3,924,017)

21. Cash generated from operati ons

Loss before taxati on (1,419,462) 3,603,293

Adjustments for:

Depreciati on 2,913,566 3,187,991

Interest income (399,612) (562,402)

Finance costs 7,617 9,671

Movements in provisions for VAT - (12,078,947)

Amorti sati on 65,427 65,424

Movement in write off inventory - 300,435

Movement in write off diesel - 6,632

Profi t and Loss on disposal of assets - (18,373)

Movements in provision for leave (21,862) 23,931

Allowance for credit losses 1,882,427 4,052,068

Changes in working capital:

Inventories (518,241) (441,343)

Trade and other receivables (2,905,799) (1,580,825)

Trade and other payables 3,176,218 (1,389,251)

Rent deposits 8,286 -

2,788,565 (4,821,696)






Restated

22. Conti ngencies

There is no reimbursement to any third parti es for potenti al obligati ons of the company

23. Related parti es

Relati onships Shareholder Provincial Department of Agriculture and Rural Development, KwaZulu Natal

Director BK NdimandeDirector J MlamboDirector SF MyeniDirector DM Myeni

Directors Refer to note 24Mjindi director in Women co-operati ve BK NdimandeMjindi directors in Ntenga trust J MlamboMjindi directors in Banguni SF and DM Myeni

Transacti ons were at arms length

Related party balance

Provincial Department of Agriculture and Rural Development, KwaZulu-Natal - 3,000

The balance refl ected above represents the grant funding that was not received at year end.

Amounts owed on the debtors books at year end

Trade debtor account - BK Ndimande 106,212 110,027

Trade debtor account - J Mlambo 43,556 39,475

Trade debtor account - SF Myeni 55,655 31,853

Trade debtor account - DM Myeni 10,702 (7)

Women co-operati ve 147,543 125,498

Abanguni agriculture co-operati ve 158,177 107,393

Ntenga offi ce and trust 42,428 38,688

Transacti ons for the year

Provincial Department of Agriculture and Rural Development, KwaZulu-Natal 56,004,000 53,180,000

Trade debtor account - BK Ndimande (3,815) 29,032

Trade debtor account - J Mlambo 4,081 16,540

Trade debtor account - SF Myeni 23,739 34,282

Trade debtor account - MD Myeni 10,709 2,226

Women co-operati ve 22,045 101,005

Abanguni agriculture co-operati ve 50,784 130,301

Ntenga offi ce and trust 3,739 3,415






Restated

24. Directors’ emolumentsDirector’s emoluments related to Board of Directors and Management Committ ee remunerati on.

Executi ve

2018

SalaryTravel and

SubsistenceTotal

Chief Executi ve Offi cer 1,042,439 212,328 1,254,767

Chief Financial Offi cer 1,219,383 119,883 1,339,266

Senior Manager Farmer Development 980,050 33,568 1,013,618

Senior Manager Infrastructure and Water Services acti ng as a CEO

1,153,624 71,509 1,225,133

4,395,496 437,288 4,832,784

2017

SalaryTravel and

SubsistenceTotal

Chief Executi ve Offi cer 1,381,995 218,819 1,600,814

Chief Financial Offi cer 1,154,472 94,107 1,248,579

Senior Manager Farmer Development 946,560 47,748 994,308

Senior Manager Infrastructure and Water Services 946,437 50,926 997,363

4,429,464 411,600 4,841,064

Non-executi ve

2018

Directors’ feesTravel and

SubsistenceTotal

Martha Senzangani Mbatha 110,224 76,265 186,489

Wakhe Richard Dladla 109,182 56,633 165,815

Bonginkosi Sibusiso Gabriel Zondi 53,728 36,986 90,714

Richard Vusimuzi Nhlebela 44,183 13,625 57,808

Soneni Fredman Myeni 41,672 28,475 70,147

Beatrice Khonzeni Ndimande 35,542 13,200 48,742

John Mlambo 41,672 14,977 56,649

Michael Dumisani Myeni 37,149 7,584 44,733

473,352 247,745 721,097

Directors costs do not agree to the amounts on the detailed income statement, amounts for directors who sit in the audit committ ee are not refl ected.






Restated

2017

Directors’ feesTravel and

SubsistenceTotal

Martha Senzangani Mbatha 55,488 31,057 86,545

Wakhe Richard Dladla 56,272 35,866 92,138

Bonginkosi Sibusiso Gabriel Zondi 33,483 29,369 62,852

Richard Vusimuzi Nhlebela 21,677 6,471 28,148

Soneni Fredman Myeni 24,189 10,746 34,935

Beatrice Khonzeni Ndimande 20,672 2,578 23,250

John Mlambo 24,189 5,938 30,127

Michael Dumisani Myeni 21,677 4,456 26,133

257,647 126,481 384,128

25. Events aft er the reporti ng period

There were no events aft er reporti ng date that requires reporti ng or disclosure in the annual fi nancial statements.

26. Investi gati on

There is currently an investi gati ons conducted by Special Investi gati on Unit.

27. Rati onalisati on

In the 2017 budget speech for the Provincial Department of Agriculture and Rural Development, KwaZulu-Natal, the

Member of the Executi ve Council announced the enti ti es for the department will be amalgamated into one mega en-ti ty and this process is ongoing.

28. Financial Instruments

The accounti ng policies for fi nancial instruments have been applied to the line items below:

2018

Amorti sed costTotal carrying

amount

Financial assets

Current

Trade and other receivable 11,102,988 11,102,988

Cash and cash equivalents 7,085,263 7,085,263

18,188,251 18,188,251

2017

Amorti sed costTotal carrying

amount

Financial assets

Current

Trade and other receivable 10,079,793 10,079,793

Cash and cash equivalents 5,529,016 5,529,016

15,608,809 15,608,809






Restated

28. Financial Instruments (conti nued)

2018Financial liabiliti es at

amorti sed costTotal

Financial liabiliti es

Non-current

Rent deposits 8,286 8,286

Finance lease liabiliti es 14,387 14,387

22,673 22,673

Financial liabiliti es atamorti sed cost

Total

Current


Trade and other payables 4,262,699 4,262,699

Accruals 145 145

Transfers and subsidies 3,299,864 3,299,864

7,588,713 7,588,713

2017Financial liabiliti es at

amorti sed costTotal

Financial liabiliti es

Non-current


Financial liabiliti es atamorti sed cost

Total

Current


Trade and other payables 1,079,204 1,079,204

Accrual 7,426 7,426


5,438,402 5,438,402






Restated


Trade receivables

Gross balance

Trade receivables 19,686,236 16,580,745

Less: provision for allowances credit lossesTrade receivables (10,727,413) (8,844,986)

Net balanceTrade receivables 8,958,823 7,735,759

Summary of debtors by customer classifi cati on

Rental debtors

Current (0 - 30 days) 10,157 8,085

31 - 60 days 6,900 849

61 - 90 days 14,676 15,787

91 - 120 days 15,536 747

121 - 150 days 15,243 1,155

> 151 days 381,990 289,941

Less: provision for allowances credit losses (396,519) (64,369)

47,983 252,195






Restated


Water chargesCurrent (0 - 30 days) 54,452 17,144

31 - 60 days 49,524 15,699

61 - 90 days 54,720 18,428

91 - 120 days 45,938 14,075

121 - 150 days 75,557 122,521

> 151 days 18,961,543 16,076,314

Less: provision for allowances credit losses (10,330,894) (8,780,617)

8,910,840 7,483,564

Financial instrument risks

The enti ty is exposed to various risks in relati on to fi nancial instruments. The main type of risks are credit risk andliquidity risk.

The trades’ receivables have been reviewed for indicators of impairment. Certain trades receivable were found to beimpaired and an allowance for credit losses has been recorded accordingly within other expenses in profi t or loss. Inassessing the impaired trade receivables, the agronomic state of crop was assessed including the land size and typeof crop in relati on to market value. Access to fi nance and the market for future crop producti on was also considered.The debt payment arrangement in the form of signed cession with the market. Acknowledgements of debt was anotherform of security considered in this exercise.

Rental debtorsThe normal credit term is 30 days. Where the impairment was not made, is when the debtors subsequently paid, theiratti tude to the debt is positi ve and there are indicati ons that the debtors are likely to pay.

Water charges debtorsThe normal credit terms are 1 year for sugarcane farmers and 4 months for vegetable farmers. The debt paymentarrangement in the form of signed cessions with the market. Acknowledgements of debt was another form of securityuti lised.





29. Comparison of Budget and Actual AmountsAPPROVED

BUDGETINCLUDINGROLLOVER

ADJUSTMENTSFINAL

BUDGETACTUAL

AMOUNTS

DIFFERENCEBETWEENFINAL &ACTUAL

REVENUE

Revenue from exchange transacti ons

Water and rental charges 4,905,000 - 4,905,000 4,657,171 247,829

Total revenue from exchange transacti ons

4,905,000 - 4,905,000 4,657,171 247,829

Revenue from non-exchange transacti ons

Interest received 619,000 (350,000) 269,000 270,653 (1,653)

Sundry income 385,000 (48,400) 336,600 314,478 22,122

Vat Added Tax (2,774,357) 2,774,357 - - -

Total revenue from non-exchange transacti ons

(1,770,357) 2,375,957 605,600 585,131 20,469

Transfer revenue

Departmental grant 56,001,000 6,877,316 49,123,684 49,123,684 -

Roll over - 4,330,480 4,330,480 4,330,480 -

56,001,000 11,207,796 53,454,164 53,454,164 -

EXPENDITURECompensati on of employees (23,834,417) 3,399,692 (20,434,725) (20,392,750) (41,975)

Board of directors (1,269,000) 400,000 (869,000) (853,274) (15,726)

Electricity costs (14,560,020) 1,768,973 (12,791,047) (12,785,313) (5,734)

Water costs (6,298,274) 793,472 (5,504,802) (5,501,100) (3,702)

Commercialisati on and fruits (2,450,328) 1,683,669 (766,659) (640,914) (125,745)

Nursery costs - (212,911) (212,911) (212,558) (353)

Repairs and maintenance (1,573,937) (6,487,658) (8,061,595) (5,676,214) (2,385,381)

Security (1,680,000) 286,316 (1,393,684) (1,351,940) (41,744)

Capital assets (503,000) (2,034,754) (2,537,754) (1,561,588) (970,166)

Goods and services (6,966,667) 187,321 (6,392,586) (5,817,360) (575,226)

Amounts in the Budget and Actual

(59,135,643) (215,880) (58,964,763) (54,793,011) (4,165,752)






Restated

EXPLANATIONS FOR MAJOR VARIANCES ABOVE 10% BETWEEN ACTUAL AND BUDGETED AMOUNTSREVENUE

Water and rental charges - outbreak of army worm, reproducti on of rates and interrupti on in water supplied resultedin farmers having to replant hence redacti on in monies collected.

Sundry income - Decline in the need for the hiring of implements by farmers.

EXPENDITURE

Commercialisati on - Floods disrupted the operati on and the supplier could not deliver.Repairs and maintenance - Suppliers failed to meet the deadlines, some cancelling the orders and this causeddelays in procurement.

Capital assets - Late delivery by suppliers.

30. Commitments

Approved and contracted for

• Property, plant and equipment 973,610 499,754

Approved and contracted for

• Operati onal expenditure 1,931,936 3,085,100

31. Change in esti mate

Property, plant and equipment

The useful life of investment property was esti mated in 2017 to be 50 years with a residual value of 10%. In the currentperiod management have revised their esti mate to 60 years with the same resedual value. The eff ect of this revisionhas decreased the depreciati on for the current periods by R8 628,

32. Prior period errors

Prior period error - Finance lease and sundry equipment carrying amountPrior period error represents the fi nance lease carrying amount where accumulated depreciati on was recognised onwrong cost of minimum lease payment. The enti ty should have recognised only the fair value amount depreciati onAnd the sundry equipment cost and accumulated depreciati on was incorrectly stated.The eff ect of the adjustment of this error on the results of 2017 was as follows:Statement of Financial Positi onIncrease in fi nance lease carrying amount 399Increase in sundry equipment carrying amount 44 848Prior period error - SARS - Employee Tax Incenti vesPrior period error come about as a result of Employer tax declarati on forms EMP501 being overridden by EMP201 andEmployee Tax Incenti ves not declared.The eff ect of the adjustment of this error on the results of 2017 was as follows:Statement of Profi t or Loss and Other Comprehensive IncomeIncrease in salaries 18 500Increase in SARS penalti es and interest 3 106Decrease in surplus (21 606)Statement of Financial Positi on




NOTES TO THE ANNUAL FINANCIAL STATEMENT


Restated

32. Prior period errors (conti nued)

Increase in SARS - Pay as you earn 21 606Prior period error - Government grants and subsidiesIncorrect recogniti on of government grant at year end.The eff ect of the adjustment of this error on the results of 2017 was as follows:Statement of Profi t or Loss and Other Comprehensive IncomeDecrease in Government grants and subsidies 4 556 520Prior period error - Transfers and subsidiesIncorrect recogniti on of government grant as a liability as the enti ty has no present obigati on to pay back the unspentfunds at year end.The eff ect of the adjustment of this error on the results of 2017 was as follows:Statement of Financial Positi onDecrease in Transfers and subsidies 4 330 480

Statement of fi nancial performance 2017 Last year This year Diff erence

Surplus 8,181,020 3,603,293 4,577,727

Statement of Financial Positi on movement Last year This year Diff erence

2017 Carrying value Property, plant and equipment 50,358,945 50,404,191 45,246

Current Liabiliti es 6,221,755 1,912,880 4,308,875

Statement of Changes in Equity 2017 Last year This year Diff erence

Accumulated surplus 34,399,061 38,753,183 (4,354,122)

33. Irregular expenditure


There were no irregular expenditure in the current year ending 31 March 2018.The following informati on relate to year ending 31 March 2016:Due to the high electricity expenditure incurred by the enti ty, a Supplier was awarded to implement energy savingsmethods. The award was through unsolicited bid which was approved by the Board of Directors. A memorandum forcondonement has been sent to Treasury for approval.The procurement of goods was undertaken by splitti ng of orders to avoid complying with the requirements of biddingprocess. The total amount was R520 859. A memorandum for condonement has been sent to Treasury for approval.The suppliers who undertook business with the enti ty were suppliers in service of the state. The total amount wasR 2 249 386. The investi gati on is sti ll ongoing.The procurement of goods was undertaken by using incorrect method to calculate points for price. The amount paid was R225 412. The evaluati ng committ ee met and evaluated the tender using correct points for price and the same supplier had the highest points.

34. Fruitless and wasteful expenditure

Opening balance 3,106 -

Movements 3,517 3,106

6,623 3,106




DETAILED INCOME STATEMENT


Restated

Water supply services and rentals

Water supply services 4,841,916 4,984,865

Rentals 262,112 316,150

16 5,104,028 5,301,015

Less direct expenditure

Labour 2,804,812 2,687,713

Irrigati on maintenance 3,861,401 4,386,393

Electricity 12,785,313 14,026,733

Water usage 5,501,100 6,623,100

Total direct expenditure 24,952,626 27,723,939

Gross (loss)/surplus (19,848,598) (22,422,924)


Other income

Sundry income 18,256 60,463

Rental implements 97,000 160,430


Nursery income 800 105

Debtors interest 1,838,855 1,651,515

Profi t on disposal of assets - 18,601

Interest received 18 399,612 562,402

2,552,721 2,455,016

Expenses excluding direct expenditure (Refer to page 101 - 102) (33,239,652) (23,070,882)

Operati ng surplus (1,411,845) 3,612,964

Finance costs 19 (7,617) (9,671)

Surplus for the year (1,419,462) 3,603,293

The supplementary informati on presented does not form part of the annual fi nancial statements and is unaudited






Restated

35. Operati ng and administrati on expenses

Adverti sing and appointment costs (56,133) (60,556)

Allowance for credit losses (1,882,427) (4,052,068)

Amorti sati on (65,247) (65,424)

Auditors remunerati on - external auditors (1,533,997) (1,226,979)

Bank charges (45,286) (47,306)

Building maintenance (696,255) (51,584)

Cellphone allowance (48,500) (57,000)

Cleaning and refreshments cost (238,944) (237,171)

Commercialisati on (640,914) (1,379,843)

Computer licenses (112,535) (105,875)

Depreciati on (2,913,566) (3,187,991)

Directors fees (533,939) (313,057)

Directors meeti ngs (28,460) (48,731)

Directors travelling (290,874) (244,143)

Electricity (13,067,980) (14,438,807)

Farmers workshop expenditure (32,250) (24,600)

Government levies (450) (450)

Housing allowance (483,022) (507,209)

Insurance (598,195) (628,983)

Legal fees (81,334) (30,580)

Loose tools and workshop consumables (39,738) (18,056)

Loss on sale of asset - (228)

Medical aid (482,821) (468,549)

Motor vehicle expenses (147,822) (189,001)

Nursery expenses (212,558) (131,926)

Irrigati on maintenance (3,861,401) (4,386,393)

Water usage (5,501,100) (6,632,100)

Pension contributi on (2,116,476) (2,114,881)

Planti ng inputs - (45,000)

Printi ng and stati onery (229,008) (272,095)

Professional fees (329,365) (163,713)

Protecti ve clothing and fi rst aid (129,583) (51,223)

Provision for VAT - 12,078,947

Rentals (13,160) (16,275)

Repairs and maintenance (1,120,464) (418,252)

Salaries and wages (16,535,228) (16,262,786)

Security (1,458,280) (1,711,122)

Skills development levies (177,411) (172,740)

Subsidy vehicle allowance (423,500) (494,400)






Restated

Subsistence and travel (680,870) (654,290)

Telephone and fax (228,236) (284,503)

Training and bursary (167,584) (142,052)

Unemployment insurance fund (107,293) (109,238)

Vehicle fuel and lubricants (452,270) (521,183)

Vehicle licenses (19,368) (19,953)

Workmens compensati on (408,434) (522,958)

Write off diesel - (6,632)

Write off inventory - (344,232)

Write off protecti ve clothing - (2,130)

(58,192,278) (50,794,821)

Expenses excluding direct expenditure

Operati ng, administrati on and direct expenditure (58,192,278) (50,794,821)

Direct expenditure 24,952,626 27,723,939

(33,239,652) (23,070,882)


PART EHUMAN RESOURCE MANAGEMENT


1. INTRODUCTION

Human Resource Management (HRM) involves employer-employee relati onship. It is about supporti ng and managing the organisati on’s people and associated processes. Human Resources (HR) are the most valuable and unique assets of an Enti ty. The successful management of an organizati on’s human resources is an exciti ng, dynamic and challeng-ing task. The scarcity of talented resources and the growing expectati ons of the modern day worker have further increased the complexity of the human resource functi on. Even though specifi c human resource functi ons/acti viti es are the responsibility of the human resource unit, the actual management of human resources is the responsibility of all the Managers within the Enti ty.

HRM outlines the importance of human resources and its diff erent functi ons in an organizati on. It examines the various HR processes that are concerned with att racti ng, managing, moti vati ng and developing employees for the benefi t of the organizati on.

Mjindi Farming (Pty) Ltd Managers and Employees understand and give due importance to the diff erent human re-source policies and acti viti es within the Enti ty.

This 2017/2018 HR annual report gives a breakdown of expenditure incurred as a result of salaries, overti me, housing allowance and medical assistance, the total number of posts fi lled within Mjindi Farming, terminati ons, leave taken, training and development, occupati onal health and safety as well as compliance with the legislati ve requirements.

2. COMPLIANCE WITH LEGISLATION WITHIN HR MANAGEMENT

2.1. Basic Conditi ons of Employment Act (Act No. 75 of 1997)

The purpose of this Act is to give eff ect to and regulate the right to fair labour practi ces conferred by secti on 23 (1) of the consti tuti on by establishing and enforcing basic conditi ons of employment and by regulati ng the variati on of basic conditi ons of employment. The Basic Conditi ons of Employment Act, secti on 29, provides for certain writt en parti cu-lars of employment to be provided as a minimum, and every employer is legally obliged to provide all employees with these minimum parti culars in writi ng not later than the fi rst day of employment. In compliance with this Act, Mjindi Farming as an employer has ensured that it enters into a writt en contract of employment with each of its employees. Mjindi Farming overti me policy, all hours worked in excess of normal working hours are paid as overti me. Overti me is paid at 1.5 ti mes of the employee’s normal wage and for an employee who occasionally works on a Sunday a double pay is paid. The Basic Conditi ons of Employment Act, Chapter 3, covers employee’s rights with respect to all types of leave. Mjindi Farming has complied with the legislati ve requirements in terms of all types of leave.

2.2. Medical Aid Schemes Act (72 of 1967)

Mjindi Farming Employees have an opti on of becoming members of Medical Aid Scheme registered in terms of the Act on Medical Aid Schemes (Act 72 of 1967). In terms of Medical Aid contributi ons Mjindi Farming contributes 50% up to a maximum of R1300.00 per month.

2.3. Labour Relati ons Act (66 of 1995)

The purpose of this Act is to regulate and guide the employer in recognizing and fulfi lling its role in eff ecti ng labour peace and the democrati sati on of the workforce. In compliance with the provisions of this Act Mjindi Farming has done its best to ensure that its relati onship with employees is based on trust. Mjindi Farming managed to engage its employees in terms discussing issues that aff ect staff . Mjindi Farming ensured that its employees receive a salary in-crease during the fi nancial year 2017/2018.

2.4. Skills Development Act (97 of 1998)

The purpose of this Act is to develop the skills of the South African workforce and to improve the quality of life of workers and their prospects of work; to improve producti vity in the workplace and the competi ti veness of employers. Mjindi Farming has in many ways complied with the Act in and has given opportuniti es to Student and Graduate In-terns to gain work experience within the Enti ty. Mjindi Farming managed to provide training to its employees. Mjindi Farming submitt ed online the Annual Training Report 2017/2018 to AgriSETA on 27th April 2018. The Annual Training Report 2017/2018 gave an indicati on on the training conducted during the fi nancial year 2017/2018.


2.5. Occupati onal Health and Safety Act (85 of 1993)

The purpose of this Act is to ensure that workers are provided with protecti on against hazards and unsafe working con-diti ons in the workplace. In compliance with the Occupati onal Health and Safety Act of 1993 Mjindi Farming provided health and safety training to its employees.

Mjindi Farming employees received training on Occupati onal Health and Safety. The duty of every employee at work to take reasonable care for the health and safety for himself or herself as well as of other persons was emphasized. The training also put it clearly that the employees are legally bound to comply with the prescripti ons of the OHS Act and should always carry out and obey lawful orders and obey the health and safety rules and procedures laid down by the employer.

2.6. Compensati on for Occupati onal Injuries and Diseases Amendment Act (No. 61 of 1997)

The purpose of this act is to provide for compensati on for disablement caused by occupati onal injuries or diseases sustained or contracted by employees in the course of their employment, or for death resulti ng from such injuries or diseases; and to provide for matt ers connected therewith. There were no reported injuries on duty during the year under review.

2.7. Employment Equity Act (55 of 1998)

The purpose of this Act is to achieve equity in the workplace by promoti ng equal opportunity and fair treatment in employment through the eliminati on of unfair discriminati on and implementi ng affi rmati ve acti on measures to redress the imbalances of the past. Mjindi Farming has a policy in place which guides management in terms of compliance with the Act. Mjindi Farming submitt ed the Employment Equity Report to the Department of Labour on 20th Decem-ber 2017. This submission was in compliance with the Employment Equity Act 55 of 1998.

2.8. Public Finance Management Act

The purpose of this Act is to regulate fi nancial management in the nati onal and provincial governments; to ensure that all revenue, expenditure, assets and liabiliti es of those governments are managed effi ciently and eff ecti vely; to provide for the responsibiliti es of persons entrusted with fi nancial management in those governments and to provide for matt ers connected there with. Mjindi Farming complied with the Public Finance Management Act and Treasury Regulati ons in terms of uti lizing its fi nances in relati on to its personnel related expenditure.

2.9. Unemployment Insurance Act, No 63 of 2001

The purpose of this Act is to provide for the payment from the Fund of unemployment benefi ts to certain employees and for the payment of illness, adopti on, maternity and dependant’s benefi ts related to the unemployment of such an employee. The Unemployment Insurance Fund (UIF) gives short-term relief to workers when they become unem-ployed or are unable to work because of maternity, adopti on leave, or illness. It also provides relief to the dependants of a deceased contributor.

The Act provides for the benefi ts, to which contributors are allowed, and the impositi on and collecti on of the contribu-ti ons to the UIF. Mjindi Farming as an employer as well as its employees contributes to UIF on monthly basis.


3. HUMAN RESOURCE STATISTICS

3.1 PERSONNEL RELATED EXPENDITURE

Table 3.1.1: Personnel expenditure by programme 2017 / 2018

Total expenditure

(R’000)

PersonnelExpenditure

(R’000)

TrainingExpenditure

(R’000)

Professionaland Special

ServicesExpenditure

(R’000)

Personnel Expenditure

as a % of Total Expenditure

Average Personnel cost

peremployee

(R’000)

Mjindi Farming R58 192 20 374 R167 R329 35% R318

Table 3.1.2: Personnel costs by salary bands 2017 / 2018

Salary BandPersonnel Expenditure

(R’000)

% of total

personnel cost

Number of employees

cost per employee

(R’000)

Average personnel

Skilled (Level 3-5) R 5 200 25% 28 R185

Highly skilled produc-ti on (Levels 6-8)

R 5 279 26% 17 R310

Highly skilled supervi-sion (Levels 9-12)

R 4 865 23% 9 R540

Senior and Top man-agement (Levels 13-16)

R 4 604 22% 4 R1151

Contracts R 426 2% 6 R71

Total R 20 374 100% 64 -

Table 3.1.3: Salaries, Overti me, Home Owners Allowance and Medical Aid, 2017 / 2018

Salaries Overti meHousing

AllowanceMedical Aid

Amount (R’000)

Salaries as a % of

personnel costs

Amount (R’000)

Overti me as a % of

personnel costs

Amount (R’000)

HOA as a % of person-nel costs

Amount (R’000)

Medical aid as a % of

personnel costs

Mjindi Farming

R16 535 81% R181 0.89% R483 2.37% R482 2.36%

Table 3.1.4: Salaries, Overti me, Home Owners Allowance and Medical Aid by salary band, 2017/2018



Amount (R’000)

Salaries as a % of

personnel costs

Amount (R’000)

Overti me as a % of

personnel costs

Amount (R’000)


Amount (R’000)


personnel costs

Skilled (Lev-el 3-5) R 5 200 25% R14 0.07% 268 1.27% R233 1.10%

Highly skilled producti on (Levels 6-8) R 5 279 26% R95 0.45% 148 0.70% R182 0.86%

Highly skilled supervision (Levels 9-12) R 4 865 23% R72 0.34% 67 0.32 R67 0.32%




Amount (R’000)

Salaries as a % of

personnel costs

Amount (R’000)

Overti me as a % of

personnel costs

Amount (R’000)


Amount (R’000)


personnel costs

Senior and Top man-agement (Levels 13-16)

R 4 604 22% - - - - - -

Contracts R 426 2% - - - - - -

Total R 20 374 100% R181 0.86% R483 2.28% R482 2.28%

3.2. EMPLOYMENT AND VACANCIESThe following tables summarize the number of posts on the establishment, the number of employees and the percentage of vacant posts.

Table 3.2.1: Employment and vacancies as at 31 March 2018

Number of posts on approved establish-

ment Number of posts fi lled Vacancy rate

Number of employ-ees additi onal to the

establishment

Mjindi Farming 92 55 37 -

Table 3.2.2:- Employment and vacancies by salary bands as at 31 March 2018

Salary bandNumber of posts on

approved establishment

Number of posts fi lled Vacancy RateNumber of

employees additi onal to the establishment

Skilled (Level 3-5) 45 28 30.4% -

Highly skilled producti on (Levels 6-8)

26 15 16.3% -

Highly skilled supervision (Levels 9-12)

16 9 9.78% -

Senior Management (Levels 13-16)

5 3 3.26% -

Total 92 55 59% -

4. JOB EVALUATIONDuring the 2017-18 fi nancial year there was no job evaluati on conducted.

5. EMPLOYMENT CHANGESTurnover rates provide an indicati on of trends in the employment profi le of the Enti ty during the year under review. The follow-ing tables provide a summary of turnover rates by salary band

Table 5.1: .Annual turnover rates by salary band

Salary bandNumber of employees at beginning of peri-

od-April 2017Appointments Terminati ons Turnover rate

Skilled (Level 3-5) 28 - - -


17 - 2 -


Salary bandNumber of employees at beginning of peri-

od-April 2017Appointments Terminati ons Turnover rate


9 - - -


4 - 1 -

Total 58 - 3 -

Table 5.2: Reasons why employees are leaving the enti ty 1 April 2016 to 31 March 2017

Terminati on Type Number % of total

Resignati on 3 100%

Death - -

Dismissal - -

Total 3 100%

6. EMPLOYMENT EQUITY

Table 6.1: Total number of employees (including employees with disabiliti es) in each of the following occupati onal bands on 31 March 2017

Occupa-ti onal band

Male FemaleTOTALAfrican Coloured Indian White African Coloured Indian White

Top Man-agement (levels 15 -16)

1 - - - - - - - 1

Senior Manage-ment(lev-els 13 - 14)

2 - - - 1 - - - 3

Profes-sionally qualifi ed and expe-rienced special-ists and mid-man-agement

2 - - - 2 - - - 4

Skilled techical and aca-demically qualifi ed workers, junior manage-ment, su-pervisors, foreman and super-intendents

4 - - - 1 - - - 5


Occupa-ti onal band

Male FemaleTOTAL

African Coloured Indian White African Coloured Indian White

Semi-skilled and discre-ti onary decision making

31 1 - - 7 - - - 39

Unskilled and defi ned decision making

6 - - - - - - - 6

Total 45 - - - 11 - - - 58

6.2. RecruitmentDuring the 2017-18 fi nancial years there were no recruitments

Table 6.3: Terminati ons, 1 April 2017 to 31 March 2018

Occupa-ti onal band

Male FemaleTOTAL



3 - - - - - - - 3

Unskilled and defi ned decision making

- - - - - - - - -

Total 3 - - - - - - - 3

Table 6.4: Disciplinary acti ons, 1 April 2017 to 31 March 2018

Disci-plinary acti on

Male FemaleTOTAL



3 - - - - - - - 3

Total 3 - - - - - - - 3


Table 6.5: Types of misconduct addressed at disciplinary hearings during the year 2017-18

Type of misconduct Number % of total

Unauthorized absenteeism 1 34%

Failure to comply with Supervisor’s instructi ons 1 33%

Gross misconduct 1 33%

Total 3 100%

6.6 Grievances lodged

Grievances that were lodged at Mjindi Farming (Pty) Ltd during the year 2017-18

Type of misconduct Number % of total

Unfair treatment by the Supervisor 1 50%

Unlawful deducti on by the Employer 1 50%

Total 2 100%

7. PERFORMANCE REWARDS

During the 2017-18 fi nancial years there were no performance rewards

8. FOREIGN WORKER

The following table below summarize the employment of foreign nati onals in the Enti ty in terms of salary band and by occupati on category.

Table 8.1: Foreign Workers by salary band, 1 April 2017 to 31 March 2018

Salary

Band

Male FemaleTOTAL


Senior Man-agement (Levels 13-16)

1 - - - - - - - 1

9. LEAVE UTILISATION FOR THE PERIOD 1 APRIL 2017 TO 31 MARCH 2018

The following tables represent the type of leave taken, number of days taken per employee and the number of em-ployee who took leave during the fi nancial year 2017/2018.

Table 9.1: Sick leave 1 April 2017 to 31 March 2018

Salary bandTotal days Taken Average days per employee

Number of employees who took leave

Skilled (Level 3-5) 72 7.2 10


125 17 15


100 12.5 8


26 8.7 3

Total 323 9 36


Table 9.2: Annual leave taken during the period 1 April 2017 to 31 March 2018

Salary bandTotal days Taken Average days per employee

Number of employees who took leave

Skilled (Level 3-5) 576.5 22 26


330.55 19 17


189 21 9


68 17 4

Total 867.05 15.48 56

Table 9.3: Leave pay-outs 1 April 2017 to 31 March 2018

Reason Total Amount (R’000) Number of Employees

Average per employee (R’000)

Current leave pay out on ter-minati on of service for 2017 / 2018

R135 514.29 3 R45 171.43

10. HIV/AIDS & HEALTH PROMOTION PROGRAMMES

During the 2017-18 fi nancial year the Mjindi Farming (Pty) Ltd conti nued promoti ng a culture of care within the Enti ty. A healthy workplace means taking into considerati on the physical, spiritual, environmental, intellectual, emoti onal, occupati onal and mental health of employees. Mjindi Farming promotes wellness of its employees in the workplace. Employee wellness does not just benefi t the employee but it also benefi ts the organizati on. The organizati on fi lled with healthy and fulfi lled employees is a producti ve workplace that retains its employees. More and more Mjindi Farm-ing (Pty) Ltd ensures that employees are aware and are responsible for recognizing the importance of wellness in the workplace.

Mjindi Farming employees att ended a wellness day where they had an opportunity to check their wellbeing and en-couraged to eat healthy and exercise on daily basis. Health educati on in relati on to various diseases such as High Blood Pressure, Diabeti c, Tuberculosis and awareness on HIV/AIDs was presented to employees.

11. SKILLS DEVELOPMENT

Mjindi Farming (Pty) Ltd recognize the importance of developing employees, 138 training interventi ons were undertak-en during the year 2017-18. An employee who receives the necessary training is bett er able to perform his / her job. The employee becomes more aware of safety practi ces and proper procedures for basic tasks. The training may also build the employee’s confi dence because she or he has a stronger understanding of the industry and the responsibili-


ti es of his or her job. This confi dence may push the employee to perform even bett er and think of new ideas that help his or her to excel. Mjindi Farming (Pty) Ltd plays a criti cal role in terms of ensuring that its employees receive training from ti me to ti me which is in line with its strategic objecti ves.

12. INJURY ON DUTY

Table 12.1 provides basic informati on on injury on duty, 1 April 2017 to 31 March 2018

Nature of Injury on Duty (IOD) Number % of total

Required basic medical att enti on only - -

Temporary disablement - -

Permanent disablement - -

Fatal - -

Total - -

13. UTILISATION OF CONSULTANTS

Table 13.1: Report on consultant appointments using appropriated funds

Project Title Number of Consultants that worked on the project

Durati on

Work days

Contract value in

Rand (R000’s)

Performing fi nancial service functi on None None None

Performing internal audit functi on None None None


Total number of projects Total individual consultants Total durati on Work daysTotal contract value in Rand

(R000’s)

Performing fi nancial service functi on

None None None

Performing internal audit functi on

None None None

Table 13.2: Analysis of consultant appointments using appropriated funds, in terms of Historically Disadvantaged Individuals (HDIs)

Project TitlePercentage ownership

by HDI groups

Percentage man-agement by HDI

groups

Number of Consultants from HDI groups that work on the project

Performing fi nancial service functi on None None None

Performing internal audit functi on None None None


MJINDI FARMING (PTY) LTD

Tel: +27 35 572 9015/20

Fax: +27 35 572 9023

Makhathini Flat,

Jozini, 3969

PR241/2018ISBN: 978-0-621-46458-0

Title of Publicati ons: Annual Report 31 March 2018 year ending, Mjindi Farming (Pty) Ltd.

mjindi farming ar print · n.dip, b-tech (civil) senior engineer mr mm sifundza chief executi ve...

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