northern cape department: co-operative governance, … · code of conduct, employment equity act,...

Northern Cape Department: CO-OPERATIVE GOVERNANCE, HUMAN SETTLEMENTS AND TRADITIONAL AFFAIRS - VOTE 9


PR243/2013ISBN: 978-0-621-42118-7



Northern Cape Department Co-operative Governance,

Human Settlements & Traditional Affairs

2013



DEPARTMENT OF COGHSTAPROVINCE OF THE NORTHERN CAPE

VOTE NO. 09ANNUAL REPORT

2012-2013



ContentsPART A: GENERAL INFORMATION......................................................................................................71. DEPARTMENT GENERAL INFORMATION.............................................................................................82. LIST OF ABBREVIATIONS / ACRONYMS..............................................................................................93. STRATEGIC OVERVIEW.......................................................................................................................103.1. Vision................................................................................................................................................103.2. Mission.............................................................................................................................................103.3. Values...............................................................................................................................................103.4. Strategic outcome orientated goals...................................................................................................104. LEGISLATIVE AND OTHER MANDATES..............................................................................................105. ORGANISATIONAL STRUCTURE.......................................................................................................146. FOREWORD BY THE MINISTER / MEC..............................................................................................157. REPORT OF THE ACCOUNTING OFFICER..........................................................................................16

PART B: PERFORMANCE INFORMATION...........................................................................................181. STATEMENT OF RESPONSIBILITY FOR PERFORMANCE INFORMATION..........................................192. AUDITOR GENERAL’S REPORT: PREDETERMINED OBJECTIVES......................................................203. OVERVIEW OF DEPARTMENTAL PERFORMANCE.............................................................................203.1. Service Delivery Environment............................................................................................................203.2. Service Delivery Improvement Plan..................................................................................................213.3. Organisational Environment..............................................................................................................223.4. Key policy developments and legislative changes.............................................................................224. STRATEGIC OUTCOME ORIENTED GOALS........................................................................................235. PERFORMANCE INFORMATION BY PROGRAMME............................................................................235.1. Programme 1: Administration..........................................................................................................235.2. Programme 2: Human Settlements..................................................................................................385.3. Programme 3: Co-operative Governance.........................................................................................455.4. Programme 4: Traditional Affairs.....................................................................................................656. SUMMARY OF FINANCIAL INFORMATION........................................................................................716.1. Departmental Receipts......................................................................................................................716.2. Programme Expenditure....................................................................................................................726.3. Transfer payments, excluding public entities.....................................................................................736.4. Conditional grants and earmarked funds received.............................................................................736.5. Donor Funds......................................................................................................................................736.5. Capital investment, maintenance and asset management plan..........................................................73



PART C: GOVERNANCE.................................................................................................751. AUDIT COMMITTEE REPORT.............................................................................................................76

PART D: HUMAN RESOURCE MANAGEMENT ....................................................................................791. HUMAN RESOURCE OVERSIGHT STATISTICS..................................................................................801.1. Personnel related expenditure...........................................................................................................801.2. Employment and Vacancies...............................................................................................................831.3. Job Evaluation...................................................................................................................................851.4. Employment Changes........................................................................................................................871.5. Employment Equity............................................................................................................................931.6. Performance Rewards........................................................................................................................981.7. Foreign Workers..............................................................................................................................1011.8. Leave utilisation..............................................................................................................................1011.9. HIV / AIDS & Health Promotion Programmes..................................................................................1031.10. Labour Relations.............................................................................................................................1041.11. Skills development..........................................................................................................................106

PART E: FINANCIAL INFORMATION.................................................................................1081. ACCOUNTING OFFICER’S STATEMENT OF RESPONSIBILITY..........................................................109

2. REPORT OF THE AUDITOR GENERAL ............................................................................................120

3. ANNUAL FINANCIAL STATEMENTS.................................................................................................127



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PART A:

GENERAL INFORMATION



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1. DEPARTMENT GENERAL INFORMATION

Physical Address: 09 Cecil SussmanKimberley8300

Postal Address: Private Bag X5005

Kimberley

8300

Telephone Number/s: 053 830 9431

Fax Numbers: 053 831 2904

Email Address: [email protected]

Website Address: www.coghsta.ncpg.gov.za



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2. LIST OF ABBREVIATIONS / ACRONYMS

AGSA Auditor General of South Africa

BBBEE Broad Based Black Economic Empowerment

CFO Chief Financial Officer

MEC Member of Executive Council

HOD Head of Department

PFMA Public Finance Management Act

TR Treasury Regulations

MTEF Medium Term Expenditure Framework

SMME Small Medium and Micro Enterprises

SCM Supply Chain Management

EU European Union

SITA State Information Technology Agency

SDIP Service Delivery Improvement Plan



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3. STRATEGIC OVERVIEW

3.1. Vision People of the Northern Cape living in integrated human settlements, with responsive, accountable and high-ly effective municipalities and traditional institutions.

3.2. Mission• To facilitate and manage integrated sustainable human settlements and infrastructure development for

effective service delivery.

• To facilitate, monitor and support the consolidation and sustainability phases at municipalities for inte-grated, sustainable service delivery.

• To promote and support inter-sphere engagement for integrated planning and co-ordination.• To facilitate, develop and support systems and structures to enhance traditional leadership.

• To ensure the efficient, effective and economic utilization of departmental resources to maximise ser-vice delivery.

3.3. ValuesThe department is guided by the founding values on which its legislative framework and more specifically, the following legislative is based: The Constitution of South Africa, Batho Pele Principles, Public Service Code of Conduct, Employment Equity Act, Public Financial

3.4. Strategic outcome orientated goals This must be as per the department’s strategic plan.

4. Legislative and Other MandatesThe Northern Cape Department Co-operative Governance, Human Settlements & Traditional Affairs derives its mandate mainly from the Constitution of the Republic of South Africa.

4.1. Acts, Rules and RegulationsThe department is guided by the following legislative mandates:

• Constitution of the republic of South Africa (act 108 of 1996).

• The Public Finance Management Act (act 1 of 1999)

• The Housing Act (Act No. 107 of 1997)

• Prevention of Illegal Eviction from and Unlawful Occupation of Land (Act of 1998)

• The Housing Consumers Protection Measures Act Of 1998



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• Rental Housing Act, (Act 50 of 1999)

• Home Loan and Mortgage Disclosure Act Of 2000

• Disestablishment of South African Trust Limited Act, (Act 26 of 2002)

• National Housing Code (2000)

• The Urban and Rural Frameworks (1996),

• Municipal Structures Act (Act 32 of 2000)

• The Municipal Systems Act

• The Municipal Finance Management Act

• Disaster Management Act, 2002 (Act 57 0f 2002)

• The Division Of Revenue Act

• Property Rating Act and Property Valuation Ordinance, 1993 (Ordinance 14 of 1993)

• The Demarcation Act of 1998

• The Northern Cape Interim Housing Act, 6 of 1999

• National House of Traditional Leaders Act, Act 10 of 1997

• Traditional Leadership and Governance Framework Act, Act 41 of 2003

• Remuneration of Public Office Bearers Act, Act 20 of 1998

• The Commission for the Promotion and Protection of the Rights of Cultural, Religious and Lin-guistic Communities Act, Act 19 of 2002

• The Pension Benefits for Councilors of Local Authorities Act, Act 105 of 1987

The Public Finance Management Act (Act no. 1 of 1999)Promotes the objective of good financial management in order to maximise delivery through theefficient and effective use of limited resources.

The key objectives of the Act may be summarised as being to:

• Modernise the system of financial management• Enable public sector managers, but at the same time be more accountable• Ensure the timely provision of quality information• Eliminate waste and corruption in the use of public assets

The Housing Act (Act no. 107 of 1997)Through its legislation, existing and future, and the Housing Code, the Department of HumanSettlements is carrying out its legislative imperative as set out in the Housing Act, 1997. Section 2of the Housing Act, 1997 (Act no. 107 of 1997) compels all three spheres of government to givepriority to the needs of the poor in respect of housing development (Section 2(1)(a)).

In addition, all three spheres of government must ensure that housing development:1. Provides a wide choice of housing and tenure options as is reasonably possible2. Is economically, fiscally, socially and financially affordable and sustainable3. Is based on integrated development planning4. Is administered in a transparent, accountable and equitable manner, and upholds the practice



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5. Of good governance (Section 2(1)(c)).

Prevention of Illegal Eviction from, and Unlawful Occupation of Land Act (Act no. 19 Of 1998)The Prevention of Illegal Eviction from, and Unlawful Occupation of Land Act was promulgated in 1998. The Act repels the Prevention of Illegal Squatting Act no. 52 of 1951 and makes provision for a fair and equita-ble process to be followed when evicting people who have unlawfully invaded land, from their homes. The Act also makes it an offence to evict legally without due process of law.

The Housing Consumers Protection Measures Act (Act no. 95 of 1998)The Act provides for the establishment of a statutory regulating body for home builders. The National Home Builders Registration Council will register every builder and regulate the home building industry by formu-lating and enforcing a code of conduct. The implementation of the Act is monitored continuously.

The Rental Housing Act (Act no. 50 of 1999)This Act repels the Rent Control Act of 1976 and defines government’s responsibility for rental housing property. It creates mechanisms to promote the provision of rental housing and the proper functioning of the rental housing market. It further facilitate sound relations between tenants and landlords, and lays down general requirements for leases and principles for conflict resolution in the rental housing sector. It also makes provision for the establishment of Rental Housing Tribunals and defines the functions, powers and duties of such Tribunals. Provincial human settlement departments are establishing Rental Housing Tribu-nals, and the Northern Cape Rental Housing Tribunal was launched in 2007.

Home Loan and Mortgage Disclosure Act (Act no. 63 of 2000)The Act provides for the establishment of the Office of the Disclosure and the monitoring of financial institu-tions serving the housing credit needs of communities. It requires financial institutions to disclose informa-tion and identifies discriminatory lending patterns. The Act came into operation during 2003.

Disestablishment of South African Trust Limited Act (Act no. 26 of 2002)The winding down of the South African Housing Trust and the transfer of the functions relating to financial obligations were completed during the end of 2002 and the beginning 2003 in terms of Act 26 of 2002: Disestablishment of South African Trsut Limited Act, 2002.

National Housing Code (2000)The Code outlines the fundamental principles, guidelines and procedures that govern housingpolicy in South Africa namely: partnerships and people-centred development; skills transfer andeconomic empowerment; fairness and equity; choice; quality and affordability; innovation; transparency;Accountability and monitoring; and sustainability and fiscal affordability.

The Urban and Rural Frameworks (1996)The key focus is to ensure the provision of security of tenure, involvement of communities andBeneficiaries and the social, economic and physical integration of areas.

Municipal Structures Act (Act no. 117 of 1998 as ammended Act no. 33 of 2000)This Act provides for the establishment of municipalities in accordance with the requirements



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relating to categories and types of municipality. The Act introduces the differentiation between thefunctions and powers between categories of municipality.

The Municipal Systems Act (Act no. 32 of 2000) The act focuses on the internal systems and administration of a municipality. The Act introduces the dif-ferentiation between the function of municipal services and sets out certain requirements for entering into partnerships.

The Municipal Finance Management Act (Act no. 56 of 2003) The act is directed at securing sound and sustainable management of the financial affairs of municipalities andd other institutions in the local sphere of government; to establish treasury norms and standards for the local sphere of government and to provide for matters connected therewith.

The Disaster Management Act (Act no. 57 of 2002) Provides for an integrated and co-ordinated disaster management policy that focuses on preventing or reduc-ing the risk of disasters, mitigating the severity of disasters, emergency preparedness, effective response todisasters and post disaster recovery at national, provincial and municipal level.

The Division of Revenue Act (Act no. 1 of 2006)The act which is enacted annually, gives effect to Section 214(1) of the Constitution that provides for the equitable division of nationally raised revenue among the three spheres of government.



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5. ORGANISATIONAL STRUCTURE

MECA. Botes

Acting Head of DepartmentB.S Lenkoe

Chief Financial OfficerR. Stander

Acting Chief Director Cooperative Service

D.Boboko

Chief Director: Human SettlementsR. Soodeyal

Chief Director: Co-operative Governance

K. Moeketsi

Traditional AffairsP. Pholoholo



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Alvin BotesMECNorthern Cape Department Co-operative Governance, Human Settlements & Traditional Affairs

6. FOREWORD BY THE MEC

The Department of Co-Operative Governance, Human Settlements and Traditional Affairs (COGHSTA) is proud to present an Annual Report for 2012/2013 financial year. During that financial year, the department suc-ceeded in addressing its shortcomings raised by the Auditor General especially, on asset management, risk management and complying with reporting deadlines of Treasury, Premier’s Office, Exco, and the Provincial Legislature, among others.

The department is still committed and striving to promote and achieve clean audit as part of the government’s operation clean audit 2014 campaign.

Furthermore, in pursuit of the goal of bettering the lives of our people, we remain resolutely dedicated and committed to the delivery of clean governance, open and transparent municipalities, well-supported tradition-al leadership structures and communities, as well as continued delivery of sustainable human settlements.

Moreover, the department commits itself to hold rigorous engagements with the Khoi-San leadership and communities, and trust that Traditional Affairs Bill will be enacted into law so as to give recognition and well-deserved support in this regard.

In conclusion, we wish to stress our dedicated commitment to realize the ideal for a “better Lives for all”.

___________________________________

MEC: Department Of Co-Operative Governance, Human Settlements And Traditional Affairs



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ACCOUNTING OFFICER’S OVERVIEW

It gives me great pleasure to submit the Annual Report of the Department of Co-Operative Governance, Hu-man Settlements and Traditional Affairs (COGHSTA) for the 2012/13 financial year. Having been appointed as the Acting Accounting officer on 1 November 2012, a key priority was to provide the necessary administra-tive leadership to ensure that the existing commitments are honoured, including addressing the challenges that had been identified by the Auditor-General in the previous financial. As a result of all these efforts, we are pleased that not only have we achieved a financially unqualified audit opinion, but that there are also no findings on the Department’s Housing fund. This is indicative of the commitment and dedication from the COGHSTA team in ensuring that there is proper administration.

In order to accomplish the above vision, the department has set itself mid-term targets and milestones with clear performance indicators for MTEF period under review. These targets/milestones and performance indi-cators are forming the basis of the departmental strategic plan and annual performance plan. It is against this background that the department is presenting its performance against the predetermined objectives set in the Strategic Plan document and the financial position of the department as at the end of 2012/13 financial year. I needs mentioning that the department reduced a number of planned targets that could not be achieved from … during 2011/12 to 67 for 2012/13. This represents 46% of the total planned targets that were not achieved during the year under reviewed compared to 76% during 2011/12.

The department is working towards achieving all its planned objectives and targets in 2013/14 with the assis-tance of a newly established Strategic Planning and Monitoring & Evaluation Unit. One of the priorities of the unit is to develop appropriate systems and standard operating procedures to collect, collate, verify and store performance information to ensure valid, accurate and complete reporting of actual achievements against planned objectives, indicators and targets.

We acknowledge our areas of weaknesses and have taken steps to act upon them. In that regard existing policies will be reviewed and in areas where there are no policies and procedures, based on outcome of the risk assessment conducted policies will be developed and implemented. This will ensure the achievements of control activities and improve the departmental control environment.

7. REPORT OF THE ACCOUNTING OFFICER

Bafedile LenkoeAccounting OfficerDepartment of COGHSTA



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With the assistance of work done by Internal Audit Committee, implementation of Management Practices Assessment Tool and constant monitoring of Key Drivers for Internal Control, the department will achieve a Clean Administration in the next audit cycle. IT is another area that is critical to our success in that it supports the core business. However, our IT systems in the department have improved based on the audit outcomes from the AG’s report and we hope that it will keep with our strategic goals. Investigations are underway on how to make IT systems support our strategic direction.

The 2012/13 financial year has certainly been both exciting and challenging. The Department is well aware of the fact that it needs to do more to achieve optimal levels of performance, and in the period ahead we will sharpen our strategies and beef up our capacity to ensure that we have a bigger impact on low income housing delivery, supporting municipalities and traditional institutions. I wish to thank the former MEC of COGHSTA Hon. Mosimanegape Kenny Mmoiemang for his leadership of the Department during the fiscal year under review. Last but certainly not least, thanks to Team COGHSTA, the team of men and women on whom the work of this Department depends and committed to turn around performance in department.

My sincere appreciation also goes to the newly appointed Hon. MEC Alvin Botes who continues to steer the Department to raise the bar and perform better, and under whose leadership this Annual Report was pre-pared. Hence we are entering 2013/14 focused on ensuring that delivery is not only improved but we can demonstrate that there is effective and efficient service delivery.

___________________________________

B.S. LenkoeActing Head of Department



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PART B: PERFORMANCE INFORMATION



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1. STATEMENT OF RESPONSIBILITY FOR PERFORMANCE INFORMATIONStatement of Responsibility for Performance Information for the year ended 31 March 2013

The Accounting Officer is responsible for the preparation of the department’s performance information and for the judgements made in this information.

The Accounting Officer is responsible for establishing, and implementing a system of internal control de-signed to provide reasonable assurance as to the integrity and reliability of performance information.

In my opinion, the performance information fairly reflects the performance information of the department for the financial year ended 31 March 2013

___________________________________

B.S. LenkoeAccounting OfficerDepartment of COGHSTA



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2. AUDITOR GENERAL’S REPORT: PREDETERMINED OBJECTIVESRefer to the Audited report on Page 112.

3. OVERVIEW OF DEPARTMENTAL PERFORMANCE3.1. Service Delivery EnvironmentThe Human Settlements Directorate has contributed to Outcome 8 of Governments mandate which is sustain-able human settlements and improved quality of household life. The department has focused on the upgrad-ing of informal settlements, affordable rental housing and accreditation of municipalities to undertake human settlements functions, which unlocks the capacity of Government to deliver services to its people.

The Northern Cape is the largest province in terms of land mass; however its population is the smallest, which determines its smallest allocation of the Human Settlements grant to the province. This has posed numerous challenges in successfully implementing large scale projects, as these projects require big allocations over the MTEF period thus impacting negatively on service delivery in the larger cities where the informal settle-ments are mushrooming.

Despite the budget constraints, in the 2012/13 financial year, the department continued to strive towards fulfilling its mandate and has successfully met its outcome 8 target of providing 9 860 households in informal settlements with housing and basic services.



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3.2. Service Delivery Improvement Plan

Main services provided and standardsMain services Actual customers Potential custom-

ersStandard of service Actual achievement

against standards

Provide low cost housing units

Communities Quality Adequate shelter

Operation clean audit Municipalities Submission of Annual Financial Statement on

time

Render overall support to Traditional Leadership and insti-tutions

Khoi-San communi-ties

To ensure legislative compliance and under-take rigorous research to deal with the Khoi-

San communities

Consultation arrangements with customersType of arrangement Actual Customers Potential Customers Actual achievements

Site meetings Communities Communities

Periodic circulars send to municipalities and quarterly visits to municipality

Municipalities Municipalities

Quarterly meetings and monthly meetings Khoi-San Communities Khoi-San communities

Service delivery access strategyAccess Strategy Actual achievements

Regional offices Community Liaison Officers

Municipal offices Information sessions on Service Charter for all staff mem-bers.

Regional offices

Service information toolTypes of information tool Actual achievements

Leaflets

Information sessions with staff Informed staff for better service delivery

Complaints mechanismComplaints Mechanism Actual achievements

Presidential Hotline Complaints received from Hotline

Suggestion boxes in all offices Reports consolidated to inform SDIP



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3.3. Organisational environment The Human Settlements Directorate has 3 key programmes, namely Housing Policy, Planning and Research, Housing Development and Housing Administration. There are 5 Regional Offices with staff project managing the construction of houses in their area of jurisdiction.

The organisational structure for Human Settlements was approved in August 2008. Taking into account the new mandate of Human Settlements and outcome 8, the organisational structure was reviewed but not yet approved.

The challenges facing the directorate are as follows which poses a huge risk in implementing quality human settlements projects:

• The limited equitable share allocation to the Human Settlements Directorate.

• Lack of professionals and project management skills at both Head Office and Regional offices

• Lack of Office space

• Lack of Adequate ICT infrastructure and staff having old outdated computers.

Through the analysis of the organisational environment, the department is in the process of appointing pro-fessionals on contract until such time the organisational structure is filled.

3.4. Key policy developments and legislative changesThe pronouncement by the President with respect to the name change of the Department of Housing to Hu-man Settlements looks at transforming the landscape of housing in the country. The new human settlement policy/strategy looks at housing for the poor, rental housing for the low to middle income earners and GAP market housing for middle to high income earners.

Revisions were made to policies with the view to fast tracking sustainable human settlements.

The following policies and legislations have been amended:

• The Housing Code.

• Housing Act



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4. STRATEGIC OUTCOME ORIENTED GOALSThe Department consists of four Programmes namely.

PERFORMANCE INFORMATION BY PROGRAMME

Programme 1: Administration

PurposeThe programme aims to ensure that overall management is strategic, policy is developed, monitored and evaluated, legal and human resources support is provided to all programmes and that financial manage-ment is effective, efficient, economical and transparent.

SUB-PROGRAMMEOffice of the MEC and Corporate Service

Strategic Objectives:

• To carry the political mandate of government• To provide a comprehensive capacity building service to the Department through multi-skilling opportunities.• To improve financial management and promote efficient, effective and value for money service delivery.• To provide support to the Department in strategic planning, policy research, monitoring and evaluation.



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Performance Indicators

Human Resources AdministrationPerformance Indicator

Actual Achieve-ment 2011 / 2012

Planned Target2012 / 2013

Actual Achievement2012 / 2013

Deviation from planned target to Actual Achieve-ment for 2012 /

2013

Comment on deviations

Consultation meetings, review reports, business case report, sub-mission to MPSA

Organisation-al structure

reviewed every third year, new

mandates, incorporation of traditional affairs

Implementation of approved organi-sation structure in phases and mon-itor progress and

evaluate

Report submitted and the submiss-sion made to the

HOD

None None

Evaluate or re-evaluate all newly defined proposed critical posts and the current vacant posts on grade 9 or higher in the department in terms of the prescribed job evaluation syste

To evaluate all newly defined posts 1 – 14 =

185 and current vacant 9 or higher

= 54

100% of identified posts to be evaluat-

ed annually

Inputs were received from few officials Two poli-cies (Recruitment and leave) policies

have been circulated to all staff for their

inputs.

All units and regional personnel must provide in-

puts in this regard. Insufficient feed-

back received from the employees. Lack of support

from staff in terms of inputs

Information sessions to be

conducted

To assist in the development of job description and job titlesFor all new posts and jobs where there exist a significant change in job content.

Standardize all job descriptions

to ensure that it is aligned with the

strategic objective of the Department as per Public Ser-vice regulations and guide on job

descriptions

Job descriptions reviewed where

necessary to ensure they remain accurate and appropriate to

ensure that they are aligned with Depart-

mental objectives

Appointments on PERSAL =34

Short listing of posts =34

Interviews conduct-ed = 24

Contract Extensions =7

Post abolished on PERSAL = 158

Promotions= 11Probation reports

completed =44No of Upgrades=14

None None

To ensure that employees from level 1-12 comply with the PMDS policy by entering into performance agreements and work plans at the beginning of financial year and quarterly assess-ment reviews are submitted on time

PMDS fully im-plemented

PMDS fully imple-mented, monitored

and revised.

All applications received were pro-

cessed

None None



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To implement human resource policies and guidelines to ensure consis-tent and uniform management of human resources

4 Policies to be developed

Five approved hu-man resources poli-cies implemented

Management report has been submitted

None None

Human Resources ManagementPerformance Indicator

Actual Achievement 2011 / 2012



Deviation from planned target to Actual Achieve-

ment for 2012 / 2013


Human Resource plan, Recruitment Strategy and Em-ployment Equity plan implemented.Advertisement in line with policy, selection docu-ments, appoint-ment letters

80 Post advertised and fill

Advertise and fill all identified prior-

itised posts.

Finalised organi-sational structure

Budget Con-straints

Re-align the cur-rent structure to fill critical posts.

Timeous process-ing of applications with regard to conditions of service All applications processed in line with Human Re-sources Policies.Approved appli-cations captured, approved and records updated

100% of All received applica-tions processed.

All applications processed in line with Human Re-sources Policies

41 Job evaluations conducted and 5 presented for

quality assurance

Lack of coopera-tion from affected

officials

HOD to intervene.

Update database to be aligned with the organogramQuarterly man-agement report compiled and submitted

100% information updated

Provide four (4) management

reports

Received a list of all new appointees and assisted with job descriptions

None None

Consultation meetings, review reports, business case report, sub-mission to MPSA

Organisational structure reviewed process finalised 100% by 31 / 03

/ 2012

Implementation of approved organ-isation structure in phases and

monitor progress and evaluate


None None



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To assist in the development of job description and job titlesFor all new posts and jobs where there exist a significant change in job content.

Standardize all job descriptions

to ensure that it is aligned with the

strategic objective of the Department as per Public Ser-vice regulations and guide on job

descriptions

Job descrip-tions reviewed

where necessary to ensure they

remain accurate and appropriate to ensure that

they are aligned with Departmental

objectives


None None

Labour RelationsPerformance

IndicatorActual Achieve-

ment 2011 / 2012Planned Target

2012 / 2013Actual Achievement

2012 / 2013Deviation from

planned target to Actual Achieve-ment for 2012 /

2013


Advise and monitor the implementation of resolutions and labour law prescripts

Disciplined and satisfied

staff.

100% of reported cases dealt with.

10 disciplinary cases have been

reported and 11 of these have been

finalised. 3 disputes awaiting arbitration. 4 Grievances report-ed and 3 finalised.

None None

Accurate labour relations ad-vice provided to the depart-ment

Comply to legislative prescripts

and collective agreements

100% compliance with legislative prescripts and

collective agreements

3 disputes were de-clared for this period

and are awaiting arbitration dates

9 grievances were lodged.

5 grievances were lodged and were

resolved.8 were finalized

6 is pending1 finalized, ruling in favour of the depart-

ment

None None

Workshop / training ses-sions on labour relation issues heldAll officials trained per directorate at both provincial and regional level

Well informed staff in terms of labour rela-tions matters

2 Workshops / training sessions held

120 CDW’s were trained

Trained 60 staff members from the

Department .

None None

Updating the database on a regular basis

Accurate information

kept

Quarterly and bi-annually reports submitted Timeously to the PSC (Public Service Commission) and Premier

Office

3 reports submitted None None



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EHWPerformance

IndicatorActual

Achievement 2011 / 2012



Deviation from planned target to

Actual Achievement for 2012 / 2013


Number of proactive programmes developed.

Number of awareness campaigns held.

Health aware-ness sessions / events held

2 proactive programmes to be fully developed.

14 awareness campaigns / sessions planned, coordi-

nated and evaluated.

22 sessions conducted

None None

Provide counselling to referred em-ployees in line with employee assistance policy.

100% 100% None None

General Support ServicePerformance Indi-

catorActual Achieve-

ment 2011 / 2012Planned Target

2012 / 2013

Actual Achievement

2012 / 2013


2013


Updated Records Management policy

Updated Records procedure manual

Approved records control schedule

Updated line func-tion file plan

Number of regions supported

Number of records disposed off.

Approved and im-plemental records

management policy, procedure manual and line

functions file plan

Functional Records Manage-

ment system

Approved line function file plan

Support provided to all regions

Disposal of records (40 linear meters annually)

Awaiting outcome of inputs to the Line functions File Plan

from Provincial Archives

Planning Annual Records Manage-ment visit to Pixley Ka Seme and J.T.

Gaetsewe Regional offices.

One submission sent to Provincial Archives

for approval.

None None



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Performance Indi-cator

Actual Achieve-ment 2011 / 2012

Planned Target

2012 / 2013

Actual Achievement

2012 / 2013


2013


High risk security areas zoned

Approved key control procedure manual

Business continuity plan approved

Approved docu-ment classification manual

Staff vetted

40% fully func-tional security

system

Implemented approved security

policy

Handled the disposal of records within the

department.

One Records Manage-ment policy submitted for approval. Awaiting approval from Provin-cial; Archives for the

Records Management Policy

None None

Reviewed and updated communi-cation strategy

Monthly update website

Number of internal newsletter produced (12)

Number of external newsletter published

Implement and review communi-

cation strategy

Communication strategy imple-

mented

Departmental web-site maintained

4 newsletters published

Communication strat-egy implemented

5 website updates

None None

Marketing plan re-viewed and updated

Formulate a draft policy on Public

Participation

Implemented ap-proved marketing

plan

Marketing programme implemented

None None

Number of outreach programmes

4 outreach pro-grammes

0 Projects had to scaled down due

to budgetary constraints

will be implemented in the next financial

year

Number of forum meet-ings (4)

5 District commu-nication forums

established

Forum meetings 0 Insufficient response from the units. .

Once more di-rective would be sent to all units

to nominate staff to serve in the communica-

tion forum.

Report on services deliv-ery improvement (4).

Service delivery plan for the department re-viewed and approved

Service delivery plan reviewed and imple-

mented

1 draft None None



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General Support Service Performance Indicator Actual Achieve-

ment 2011 / 2012


Actual Achieve-ment

2012 / 2013

Deviation from planned

target to Actual Achievement

for 2012 / 2013


Customer satisfaction survey report (2)

Assessment Tool-kit approved Customer sat-

isfaction survey conducted

Occupational Health and safety training provided in JT Gaetsewe

region.

None availabil-ity of Labour department

outstanding training will be conducted in

quarter 4

Annual Statement of Pub-lic Service Commitment.

Annual publi-cation

Annual publication 0 None None

(Number) Development of transversal depart-mental policies.

100% Compliance

Review and formulate 100%

of new trans-versal policies

100% Com-pliance as

stipulated by legislation

100% (4) trans-versal departmen-

tal policies.

Prevention of litigations and

ensure legislative compliance.

Training on Cus-tomer satisfation survey provided in two regions:

JT Gaetsewe and Frances Baard

Number of Maintenance and support jobs.

On goingReview and

update

600 maintenance and support jobs annually, 150 jobs

completed per quarter.

1183 Jobs in quarter

228 ICT Jobs logged – 122 jobs need to

be logged, 319 completed, 780

scanned jobs and circulars.

5 pcs and 4 print-ers prepped

Target met, but still human capacity needs to be increased.

None

Number of ICT Status reports on “ICT mainte-nance & support plan” (Network / user / regions / server mainte-nance schedule.)

Operational plan approved

Review and update the ICT

strategy

4 ICT status reports , 1 x ICT status report per

Quarter

3 ICT Status report

None None

Number of System Secu-rity Management reports

Formulate and review policies (Constitution

for ICT forum)

4 System security reports annually, 1 report per quarter

3 x System Security

Management Report included

in ICT Status Report submitted.

None None



30

Framework report Websites 100% Compliant.

Fully functional systems for the

department.

ICT policy Frame-work implemented

(Disaster recovery plan / flow chart

ICT Steering Committee

Policies eg: ICT Security Policy,

Facilities access)

1 ICT status reports

Policies can only be updated after AG report and department

response.

The management inputs on audit

findings and Recommen-

dations will be incorporated into the ICT strategy.

General Support Service Performance Indicator


Planned Target

2012 / 2013


Deviation from planned target to Actual

Achievement for 2012 / 2013


Number of re-gions supported.

100% regional office sup-

ported. 100 % municipalities

supported.Formulate and review policies (Constitution

for District ICT forum)

All regions supported

. 3 Regions visitedSiyanda, John Taolo Gaetsewe and Fran-

ces Baard visited and supported.

Namakwa and Pixley ka Seme supported

(telephonically / remotely).

Due to cost contain-ment.

Assistance could not be provided.

Approved trans-port policy

Approved office accommodation and maintenance policy

Functional Occu-pational Health and Safety committees.

Reviewed and updated tele-phone policy

Draft a func-tional oper-ational plan for auxiliary

and logistical services.

Compliant with prescripts

Official vehi-cles managed optimally and

cost effectively

Occupational Health and Safety Act

Compliance

Functional telephone system

All the personnel need to comply with the con-tent of the service level

Agreement. (SLA)

None



31

Legal ServicesPerformance Indicator Actual Achieve-

ment 2011 / 2012


Actual Achieve-ment

2012 / 2013


target to Actual Achievement for

2012 / 2013


100% of legal opinions provided unchallenged

100% of legal opinions provided

unchallenged

19 written legal opinions / advice

None None

3 Acts

2 Amendment Bills published in the Pro-vincial Gazette.12 Notices

1 Act per annum.

1 Amendment Bill

4 Notices

1 (one) notice published.

240 contracts. 80 contracts. 33(thirty three) signed contracts

Dependent on the end-user.

0% Default judgments.

100% of old matters referred to Office of the State Attorney finalised.

100 % Successful Institution of litigation for the Department.

0% Default judg-ments.

20%

Settlement or judgement in favour of the Department.

6 (three) civil cases managed

Financial AdministrationPerformance Indicator


Planned Target

2012 / 2013





Annual budget compiled and maintained

Annual budget compiled,

captured be-fore the end ofApril 2011 and maintained on a daily basis.

Annual budget compiled,

captured be-fore the end ofApril 2012 and maintained on a daily basis.

Budget accurately cap-tured and monitored.Requested monthly

projections from pro-grammes to compile

EWS

None None

Submit Budget for 2012 / 13 on due date to Provincial Treasury

Comply, complete and submit a cred-ible budget to Treasury on

due date

Submit Budget for 2013 / 14 on due date to Provincial

Treasury

Compiled budget pre-sentation to PMTEC

None None



32

Adjustment budget com-piled,captured before the 1st ofJanuary 2012.

Adjustment budget com-

piled,captured be-

fore the 1st ofJanuary 2012.

Adjustment budget com-

piled,captured be-

fore the 1st ofJanuary 2013.

Adjustment budget compiled and sub-mitted to Provincial

Treasury

None None

100% Accurate capturing of Departmental Budget

100% Accurate

capturing of Departmental

Budget

100% Accurate

capturing of Departmental

Budget

Budget accurately captured and monitored.

None None

Monthly reports by 15th of each month

Submit twelve (12) in-year monitoring reports to Provincial

Submit twelve (12) in-year monitoring reports to Provincial Treasury

(12) in-year monitoring reports

submitted to Provincial Treasury

None None

Submit (roll)overs to Provin-cial Treasury by 30 April 2012

Submit (roll)overs to

Provincial Treasury by 30

April 2012

Submit (roll)overs to

Provincial Treasury by 30

April 2012

None None None

Annual report, including, the audited financial statements and the audit report, timeously submitted to the executive authority

Submit Departmental annual report to Provincial

Legislature by 30 September

2011

Submit Departmental annual report to Provincial

Legislature by 30 September

2012

Annual Report were submitted to legislative

None None

Quarterly reports on non-financial database for Financial Year 2010 / 11 sub-mitted toProvincial Treasury

Submit Quar-terly reports

on non-finan-cial database for Financial Year 2010 /

11 toProvincial Treasury

Submit 4 Quarterly

Performance report on

non-financial data.

Quarterly Performance report on non-financial data were submitted

None None



33

Financial AccountingPerformance Indi-cator





2013


Accurate processed documents

30 Days for process-ing of payments

Safekeeping of all processed

batches.

Safekeeping of all processed

batches.

Payment batches 100% filed.

None None

Reconciled ledger accounts.

All ledger ac-counts closing

with favour-able balances

monthly.

All ledger ac-counts closing with favourable

balances month-ly.

Individual accounts been reconciled such as: Bank adjustment’s Account, BAS credit Transfers and Claims

Recoverable.

None None

Accurate capturing of payments on sys-tems.

Payments processed on

the accounting system as per

prescribed legislative

requirements.

Payments pro-cessed on the ac-counting system as per prescribed

legislative re-quirements.

1905 payments were processed to the

amount of R76 700 064.

None None

Complied with the prescriptions of the budget circular 2012 / 13 as issued by the Provincial Treasury

Monthly cash flow requests

and cash flow reports submitted

Monthly cash flow requests and cash flow reports

submitted

Fund Requisitions were submitted to Provincial Treasury

None None

12 Monthly revenue reports

Submission of annual finan-

cial statements as per PFMA requirement (31 May).

Monthly revenue report against the revenue budget

None None

Request adjustments of incorrect expen-diture allocations against the relevant programmes

Rendering of effective and

efficient salary management

service

Monthly revenue report against the revenue budget

Adhered to pre-scribed submission

dates for IFS and AFS to PT.

None None

Rendering of effective and efficient salary management service

Submission of annual financial

statements as per PFMA require-ment (31 May).

Pay rolls has been distributed to pay-

masters.50% of pay rolls are certified and filed ac-cording to pay point

number.

Paymasters do not co-operate with

the distribution of payslips and the

certification of pay rolls.

Proper training and the impor-

tance of the returning of

payrolls should be encouraged.



34

Performance Indicator





2013


Compilation and sub-mission of the annual Tax recons

Rendering of effective and

efficient salary management

service

Monthly EMP201 has been filed via e-filing.

Accumulation and de-accumulation of

IRP5 totals

None None

Verification of per-sonnel on the staff establishment with the payroll

No headcounts were performed

Due to financial constraints

Budget should be set aside to perform critical

functions.

Educational session about salary adminis-tration

None None None

Timely responses within set time-frames

100% Address AG queries

100% Address AG queries

None None None

Supply Chain ManagementPerformance Indicator



Actual Achieve-ment

2012 / 2013



Comment on devia-tions

Complete asset register

Effective man-agement of the asset manage-ment system

(reconciliation of the Asset

Register with the Financial

Systems)

Effective manage-ment of the asset

management system (reconcili-ation of the Asset Register with the

Financial Sys-tems)

Monthly asset reconciliation

with supporting schedules.

Wrong budget alloca-tions especially item

codes.

Some Corrective journals were

compiled to correct incorrect allocations.

Supply Chain management Plan compile and verified

Develop and implement a

SCM plan

Review accord-ing to needs

and budget and implement a SCM

plan

50% of plan executed.

None None

Optimal utili-sation level of Logis system

LOGIS is effec-tively utilised for acquisi-tion demand and logistics management in compliance with legislative requirements.

LOGIS is effec-tively utilised for acquisition de-

mand and logis-tics management

in compliance with legislative requirements.

Monthly asset reconciliation

with supporting schedules.

Wrong budget alloca-tions especially item

codes.

Some Corrective journals were

compiled to correct incorrect allocations.



35

Performance Indicator



Actual Achieve-ment

2012 / 2013



Comment on devia-tions

Ensure policies and procedures are in line with SCM policies

Review supply chain policies

in line with Practice Notic-

es Released

Review supply chain policies in line with Practice Notices Released

83% implement-ed due to time

constraints.

Availability of staff. Management should encourage staff to be committed and management to fill

key positions.

Continuous monitoring of contract perfor-mance and pay-ments related to it: Recon-ciliation from BAS Reports to contracts agree-ment (monthly)

Continuous monitoring of contract

performance and payments related to it: Reconcili-ation from

BAS Reports to contracts agreement (monthly)

Continuous mon-itoring of contract performance and payments related to it: Reconcili-ation from BAS Reports to con-tracts agreement

(monthly)

SCM Checklist implemented

during December 2012.

None None

Currently in the process to review the needs within the department.

None None



36

Internal Inspectorate Performance Indicator





2013


Assessed and reviewed inter-nal controls.

Develop and implement a strategy to assess the

adequacy and effectiveness

of internal con-trol system so that the audit findings can be reduced.

(Internal Audit Plan)

Annual Report on the state of

internal controls for 2011-2012 financial years.

Checklists were developed and implemented on Hous-

ing Grant payments and SCM procedures.

The following planning activities took place;

Pre-Audit Meeting with relevant personnel

Drafting and acceptance of the engagement letter.Compilation of System

Descriptions for Conditions of Service

Bursaries and InternshipEmployee Performance Management System.Employee health and

wellnessLabour Relations.

Organisational Develop-ment.

Development of the audit procedures on the

above-mentioned process-es.

The execution phase of the said procedures has been

concluded.

None None

Financial policies and procedures containing inputs brought forward during the review.

Annual as-sessment of Strategic and Operational

Risks.

Document in-puts on financial

policies and procedures post

the review.

Draft report on Bursary And Internship programme has been issued and policy

recommendations have been incorporated on the report. The recommen-dations have been made based on the weaknesses identified during the audit

None None

Review the risk management documents.

Fully imple-mented risk management strategy by all officials within the department

Review the risk management documents.

Strategic Risk Assessment is being conducted and

concluded. Strategic Risk Register has

been compiled.

None None



37

Fostering awareness of risk man-agement and internal control system across the department.

Fostering awareness

of risk man-agement and

internal control system across

the department.

None None

Full Implemen-tation of Risk Management.

Full Implemen-tation of Risk Management.

Two meetings were held. None None

Maintain and Review of fraud prevention plan and strategy

Maintain and Review of fraud prevention plan

and strategy

One report on Goods and services

None None



38

Programme 2: Human Settlement

Purpose

The Human Settlements Chief Directorate is responsible for the development of sustainable human settle-ments in the Northern Cape in the context of transforming our cities, towns and rural areas and building cohesive sustainable and caring communities with closer access to work and social amenities, including sports and recreation facilities:

SUB-PROGRAMMEHousing Policy, Planning and Research

SUB-PROGRAMMEHousing Development

SUB-PROGRAMMEHousing Assets

Strategic Objective• Sub Programme : Housing Policy, Planning and Research

Coordinate and facilitate sustainable human settlement with various tenure options through research, policy, planning and capacity development and stakeholder mobilisation by ensuring integrated sector planning, sound regulatory frameworks and capacity enhancement to achieve the targets for Outcome 8.

• Sub Programme: Housing Development

Facilitate, coordinate and manage integrated sustainable human settlements projects in an economi-cal, efficient and effective manner.

• Sub Programme: Housing AssetsProvide Human Settlements with grant management support, co-ordinate and manage the Human Settlements Subsidy System (HSS), Human Settlements Registry and Human Settlements Assets and Property Management in an economical, efficient and effective manner.



39


Human SettlementHousing Needs, Research and Planning

PerformanceMeasures Indicator

Actual Achievement 2011

/ 2012

Planned Target

2012 / 2013

ActualAchievement2012 / 2013

Deviation fromplanned target to

Actual Achievement for

2012 / 2013

Commenton

deviations

Approved Multi-Year Human Settlements Development Plan( MYHDP

Approved Multi Year Housing

Development Plan (MYHDP submit-

ted)

1st Draft MYDHP

Final MYHDP sub-mitted to National

Department of Human Settlements

None

Number of munici-palities assisted with the development and review of the human Settlements sector plans and chapters of the IDPs

25 8 8 None

No. of meetings facili-tated and coordinated

4 4 4 None

Number of workshops conducted to ensure compliance with Na-tional Housing Code

10 11 None

Secretariat services provided to the Human Settlements Advisory Panel.

New Target 2 2 None



40








2012 / 2013

Comment ondeviations

Resource Centre for Human Settlement established and main-tained with Legisla-tions and policies.

Maintain Hu-man Settlement

Resource Centre.

Human Settle-ment Resource centre main-

tained

None

Number of Municipal-ities granted level 1 accreditation.

1 0 Inadequate institu-tional arrangements,

policies and pro-cesses to accredit the municipalities

Human resourc-es from the

department and budget provided to support the

municipalities and to ensure that

they are ready for accreditation. The municipalities will be granted level

2 in the new finan-cial year.

Number of Municipal-ities granted level 2 accreditation.

2 0

Policy guideline devel-oped onCo-habitation and tenure option

Research & Compile First

Draft

Final Draft approved

None

Number of Human Set-tlements Consumers capacitated through the Human Settlements Consumer Education Programme

1772 500 913 None



41






Deviation fromplanned target to Actual Achieve-

ment for2012 / 2013


Provide Secretarial services to RHT

4 4 4 None

Number of cases investigated

20 24 None

RHT Annual report submitted to MEC

2011 / 12RHT Report submit-ted to MEC

2011 / 12RHT Report submitted to MEC

None



42

Human SettlementHousing Development






ment for2012 / 2013


Number of sites planned and surveyed under all programmes

4176 7847 None

Number of sites planned and surveyed under ISUP

1600 includes rental of 200 sites

1611 The final layout plan constitutes more erven

Number of sites planned and surveyed under IRDP

2776 4243 The final layout plan constitutes more erven

Number of sites planned and surveyed under Emergency / Disaster

0 1993 Relocation of beneficiaries because they are staying below flood line

None

Number of sites ser-viced under all pro-grammes

1382 1553 None

Number of sites serviced under IRDP

609 806 None

Number of sites serviced under ISUP

200 404 None

Number of sites serviced under Project Link

0 134

Number of sites serviced under Rental

373 209 The remaining sites will be completed in 2013 / 2014

Number of Houses to be completed

3683 2704 2839 None



43

Human SettlementHousing Development







2012 / 2013


Number of Houses to be completed under Integrated Residential Development Phase 2: Top Structure con-struction

1421 1670 None

Number of houses un-der Informal Settlement Upgrading

450 366 Lerato Park contract was awarded late.

Tender scope amended and closes 26 / 09 adjudication will take place in October

Number of houses under Project Linked Programme

285 128 Projects under this programme com-menced only in the third and fourth quarter.

The construc-tion of houses will foll over into 2013 / 14 financial year and as procurement is in progress

Number of houses under individual programme

25 9 Applications were received late for the remaining four individuals.

The four houses will be constructed in the 2013 / 14 financial year.

Number of houses under FLISP

26 0 Sites not serviced timeously.

Number of houses under Rural Programme

200 566 The project allocation was increased

None

Number of houses com-pleted under Rectification

180 395 None None

Number of houses com-pleted under Emergency

0 0 none None

Number of affordable rental delivery

297 297 81



44







2012 / 2013


Number of projects moni-tored for compliance

32 32 34 None

Human SettlementHousing Assets Management





Deviation fromplanned target to Ac-tual Achievement for

2012 / 2013


To compile and submit monthly reports

12 IYM reports. 12 IYM reports 12IYM Reports submitted

None

Monthly conditional grant reports compiled and submitted

12 Conditional grant reports.

12 Conditional Grant Report

12 Conditional Grant Report submitted

None

Inputs to Annual Report

4 quarterly re-ports submitted.

Annual Report 4 Quarterly re-ports submitted.

None

1 Conditional grant business plan

1 Conditional Grant Business Plan submitted

1 Conditional grant business plan

1 Conditional grant business plan submitted.

None

Number of residential properties transferred to beneficiaries(En-hanced Extended Dis-count Benefit Scheme)

Number of title deeds issued to promote home ownership.

1500 2961 None



45





Deviation fromplanned target to Ac-tual Achievement for

2012 / 2013


Assist local authorities with the acquisition of land for future Human Settlements develop-ment

1 1 None

Human SettlementHousing Assets Management

PerformanceMeasures Indi-

cator





ment for2012 / 2013


Number of Human Settlements business plans assessed to determine property ownership

New Target 40 58 None None

Number of projects Captured with quality data on HSS

200 91 Submissions captured as per MEC approval.

None

Number of quality reports(Human Settlements Stats) to Stakeholders

12 14 None

Number of project and individual sub-sidy files opened

2000 1586 None None

Number of training workshops con-ducted on HSS

5 6 None None



46

Programme 3: Co-operative GovernanceThe aim of the programme is to promote good governance. Financial and institutionally viable municipal systems, structures and service delivery processes. To facilitate municipalities to provide infrastructure services within the framework of the IDP. To ensure orderly change in the built and natural environment in order to further integrated human settlement development and environmental sustainability.

Purpose: Implementation of a differentiated approach to municipalities to ensure co-ordinated planning, monitoring and evaluation of service delivery areas.

SUB-PROGRAMMELocal Governance To promote and facilitate viable and sustainable Municipalities.

SUB-PROGRAMMEDevelopment and planning To promote, monitor and support integrated development and planning.


Co-Operative GovernanceMunicipal Administration






ment for2012 / 2013


1. Number of district mu-nicipalities with functional IGR structures

5 District 5 5 None

2.Report on the number of sector departments partic-ipating in district Intergov-ernmental relations forums

5 District reports 5 Districts 5 None

3.Provincial IGR policy developed 1 Draft policy 1 Policy None

4.Monitor the number of municipalities with the implementation of competence profile during appointments

8 Municipalities 32 13



47






ment for2012 / 2013


5. Number of municipalities monitored and supported with the development and submission of Workplace Skills Plans (WSP’s) to the LGSETA.

31Municipalities

32Municipalities 32 None

6. Number of municipalities supported and monitored on the implementation of the WSP and the compiling and submission of the An-nual Training Report (ATR) to the LGSETA.

31Municipalities

32Municipalities 32 None

7. Number of disciplinary matters monitored in municipalities (Especially Section 54A and Section 56 Managers).

32 Municipalities

32 Municipalities None

The Department responds to the disciplinary cases in municipalities is not a plan action.

Co-Operative GovernanceMunicipal Administration


cator





ment for2012 / 2013


8. A report on all the public sector capacity building programmes im-plemented aimed at municipalities.

32 Municipalities

32 Municipalities None



48


cator





ment for2012 / 2013


Number of cases monitored to resolve non compliance re-garding the code of conduct for councillors

Not target for 2010 / 2011 FY 32 Municipalities 13

Municipalities are very slow in forwarding infor-mation requested from them

Number of mu-nicipalities sup-ported to develop and implement by-laws

4 Districts 32 Municipalities 32

Number of municipalities supported, moni-tored and advised on the implemen-tation of policy and legislative amendments

Not target for 2010 / 2011 FY 32 Municipalities 26

Number of cases investigated and reported on the re-determination of boundaries

Not Target for 2010 / 2011 FY 32 Municipalities None

Number of municipal-ities supported and monitored regarding the implementation of and compliance with the Remuneration of Public Office Bearers Act

32 municipalities

32 municipalities32 None



49

Co-Operative GovernanceMunicipal Compliance






ment for2012 / 2013


Number of cases mon-itored to resolve non compliance regarding the code of conduct for councillors

Not target for 2010 / 2011 FY

32 Municipal-ities 13

Municipalities are very slow in forwarding information requested from them

Number of munici-palities supported to develop and implement by-laws

4 Districts 32 Municipal-ities 32

Number of municipali-ties supported, mon-itored and advised on the implementation of policy and legislative amendments

Not target for 2010 / 2011 FY

32 Municipal-ities 26

Number of cases inves-tigated and reported on the re-determination of boundaries

Not Target for 2010 / 2011 FY

32 Municipal-ities None

Number of municipal-ities supported and monitored regarding the implementation of and compliance with the Remuneration of Public Office Bearers Act

32 municipal-ities

32 municipal-ities 32 None



50

Co-Operative GovernancePublic Participation







2012 / 2013


Number of Municipal-ities with functional ward committees 10 96 27 None

Legislative framework for ward committees and community partic-ipation reviewed and strengthened None 1 None

Still finalized the interdepartmental consultation with SALGA

Provincial Public Participation indaba to consult and commission the draft frame-work.

The CWP implement-ed in two wards per municipality None 56 33

Number of CDW’s de-ployed to Municipalities

312 281 281

Number of Munic-ipalities where full CDW programmes are implemented 27 27 27 None

Number of Municipal-ities that signed MoU to support the CDW programmes

0 27 27

Number of Departments & agencies implement-ing the CDW Master Plan 10 27 27 None



51

Co-Operative Governance: Public Participation





Deviation fromplanned target

to Actual Achievement for

2012 / 2013


Number of workshops facilitated

27 879 395

None

Number of people as-sisted to access Identity documents 2500 2000 897

Lack of report-ing.systems and mechanisms

Number of households assisted to access

social grants 1000 2000 865

Co-Operative Governance: Spatial PlanningPerformance

Measures IndicatorActual

Achievement2011 / 2012



Deviation fromplanned target to Actual

Achievement for2012 / 2013


Number of Provincial Spatial Development Framework in place 1 1

None

Number of Munic-ipalities with SDPs aligned to the PSDF and PGDS.

4 11

None

Number of land reform projects assisted

1 2None

Number of munici-palities capacitated in terms of spatial planning 32 25

Mier, Renosterberg, Ka-reeberg, Khara Hais, Dik-gatlong, Karoo Hoogland and Kai Garib did not attend the training



52








Number of Removal of Restrictions applications processed

8 20 None

Co-Operative Governance: Land Use ManagementPerformance






ment for2012 / 2013


Number of Munici-palities implementing LUMS

9 9 0 This target will be addressed in the next financial year due to the delay in the enactment of the Spatial Plan-ning and Land Use Management Bill (SPLUMB)

It is envisaged that SPLUMB will be enacted in July 2013

Number of Munici-palities supported to develop their LUMS

9 9 0 This target will be addressed in the next financial year due to the delay in the enactment of the Spatial Plan-ning and Land Use Management Bill (SPLUMB)

It is envisaged that SPLUMB will be enacted in July 2013

Number of applications managed efficiently and effectively

8 10 6 Communities need to be informed and trained about their right to appeal

Cost containment prevented unit form rolling out training programmes

Number of prospecting applications managed effectively and number of stakeholders assisted administratively.

15 78 42 applications 86 stakeholders

assisted

None



53

Co-Operative Governance: Integrated Development PlanPerformance






ment for2012 / 2013


Number of municipali-ties with credible IDPs

32 31 Kamiesberg is still in process of finalising their IDP

Acting MM submitted letter requesting exten-sion

Number of municipal-ities supported on the development of IDPs

32 22 none

Co-Operative Governance: GISPerformance






ment for2012 / 2013


32 municipalities infra-structure captured, in coordination with DWA and other infrastructure providers

Meetings / arrange-ments with data providersData verification & capturing

SPISYS busy with phase 5. Received new DWA data Completed database index and index for pro-jects. Meeting with IDP & Housing for Spisys to es-tablish user requirements. Arranged custodians for data. Arranged training on SPISYS for various officials. (33) Tested the system.

None



54

Co-Operative Governance: GIS





Deviation fromplanned


2012 / 2013


100% Accurate data available for GIS outputs

Requesting data from S.G. and other suppliers of data.Update current data sets

Received SG data.Received Spot 5 data. Download-ed SDF of Sol Plaatje.Captured airports data. New website to download spatially referenced data.ESRI software paid / updated Requested new SG data – cost involved Received Census data. Paid Global Insight. Created 2 users for Spisys. Download ports and harbours data for NC. Provided Social data and custodian details to Pula. Forwarded IDP template to Pula. Spisys assist with new data. (Can be downloaded)

To regularly update SG data, costs is involved.

SPISYS data will be avail-able for all departments to download.

Co-Operative Governance: GISPerformanceMeasures Indicator







Number of maps updated / devel-oped

160 213 160



55

Co-Operative Governance: Municipal Performance



Planned Target

2012 / 2013



ment for2012 / 2013


Number of Institutional Performance Manage-ment systems in place

32 19 Support could not be provided to municipalities that did not indicate if they have a PMS system in place due to budgetary constraints.

Number of section 57 managers with signed employment contracts (MSA Amendment Act only designates MM’s as sec 57)

32 6 This activity is reported in the municipal admin-istration unit as an output for the filling of critical posts function. We do not really focus on it.

Number of section 57 managers with signed performance agree-ments (MSA Amend-ment Act only desig-nates MM’s as sec 57)

32 89 The figure is more that targeted 32. It includes the managers reporting to the municipal manager as well.

Number of municipal annual performance reports submitted timeously

32 7 Most of the mu-nicipalities intend to submit after the MPAC oversight process and the oversight report form part of the report.

Due to various rea-sons municipalities always delay. The reports are always submitted during April to June.



56

Co-Operative GovernanceMunicipal Performance






ment for2012 / 2013


Number of municipali-ties submitted quarterly performance reports

32 municipalities (512 reports)

4 The submission of quarterly reports is not legislated there-fore municipalities do not feel compelled to submit their reports to the department.

Number of municipal-ities with functional performance audit committees

10 12 Lack of champions in municipalities to drive process of compiling section 46 reports.

Some of the local municipalities have established perfor-mance Audit Com-mittees and do not rely on the districts shared committees.

Number of municipali-ties with Internal Audit Units

10 17 This is inclusive of local municipali-ties using shared services

Some of the local municipalities have established Internal Audit Units and do not rely on the dis-tricts shared services.



57

Co-Operative GovernanceMunicipal Infrastructure






ment for2012 / 2013


Number of Municipalities that have registered pro-jects on MIS

27 20

none Some municipal-ities were already fully committed / have no more projects to register

Number of Municipalities submit monthly reports on MIG performance

324 reports(27 x3=81 per

quarter) 253

Municipalities do not submit reports when there is no expenditure

Number of municipalities assisted to improve access to Basic Water

97% 27

Number of municipalities assisted to improve access to Basic Sanitation

87% 27 Lack of capacity to drive the O & M processes and imple-mentation. Municipal-ities not implementing DWA action plan to eradicate backlogs which can results in the province not reaching 2014 targets.

Continuos increase in backlog due to de-velopments, informal settlements, Tradition-al leaders allocate sites to communities without informing municipalities and this also contributes to backlog increase

Meeting with DWA regarding Macro Planning Consult-antsThere is a need to strengthen commu-nication between all involved parties to Integrate our plans in order to prioritise water projects

We will encourage municipal councils to open debate with Traditional Leaders about the highly growing develop-ments in their area of jurisdictions and how it impacts on service delivery



58






ment for2012 / 2013


Number of municipalities assisted to improve access to Basic Refuse Removal

64% 3 Most municipal waste sites have reached their life expectancy. Municipalities do not prioritise Refuse removal. Limited funding for upgrading

Encourages munici-palities to use some of their MIG allo-cation to upgrade their landfill sites.Strengthen commu-nication with Dept. of Environmental Affairs through par-ticipatory process in all available plat-forms to strengthen support rendered to the municipalities

Co-Operative GovernanceMunicipal Infrastructure

Performance

Measures Indicator

Actual

Achievement

2011 / 2012

Planned Target

2012 / 2013

Actual

Achievement

2012 / 2013



2012 / 2013

Comment on

deviations

Number of municipalities assisted to improve ac-cess to Basic Electricity

27 3 None The department is only funding high mast lights and therefore it is diffi-cult to get funding for reticulation / electrification

Number of Municipali-ties that have updated indigent Registers for the provision of free basic services

27 15 None



59

Co-Operative GovernanceMunicipal finance




ActualAchieve-

ment2012 / 2013




Anti-corruption policies and strategies devel-oped

16 22 None N / A

Implementation of fraud prevention plans

16 0

Municipalities did not have knowledge on how to implement the plan, hence we conducting training and will monitor them to ensure imple-mentation.

CoGTA is currently conducting training and workshops to municipalities on Ethics management and Implementation strategy ensuring that they implement the plan efficiently.

Monitor timeous submission of annual financial statements by municipalities

32 19

Only 19 municipalities submitted their 2011 / 12 AFS irrespective of the constant support and monitoring provided to them. Even those assisted financially, did not submit their AFS on time.

Ensuring that municipalities do submit their 2012 / 13 AFS timeously, we will conduct continuous visits to municipalities for support and mon-itoring and assist where required.

Analysed annual finan-cial statements

32 31

Karoo Hoogland has not submitted their 2011 / 12 AFS to date due to investigations being conducted on fraud & corruption.

The unit is engaging the municipality to-gether with National & Provincial Treas-ury to resolve the matters and to seek definite solution.

Report on issues raised in Audit General reports

32 31

Karoo Hoogland has not submitted their 2011 / 12 AFS to date due to investigations being conducted on fraud & corruption.

The unit is engaging the municipality to-gether with National & Provincial Treas-ury to resolve the matters and to seek definite solution.



60

Co-Operative GovernanceMunicipal Finance






ment for2012 / 2013


Monitor internal audit units and committees

27 32 27 The district municipalities are responsible for their own func-tions and to also extend assistance to their local municipalities.

We are conducting continuous visits to both the local and district for support and monitoring.

Credit control by-laws adopted

14 12 Municipalities cannot afford to promulgate their policies, because it’s an expensive process.

The unit with the assistance of legal services have find a much cheaper route for municipalities to promulgate their policies

Reviewed promul-gated credit control by-laws



Effectiveness of promulgated credit control



Recovered municipal debt

14 0 The recovery of debt can only be determined at the end of a financial year.

To be reported after the audited financial statements.



61







ment for2012 / 2013


Reduced number of municipalities over-spending on OPEX

12 8 Compliance in terms of reporting is challenge

Reduced number of municipalities under spending on CAPEX


Reduced number of municipalities spending less than 5% on Repairs and Maintenance


Annual budget ap-proved on or before the start of the financial year

32 32

Monitor and assist municipalities with the implementation of MSIG

32 32

Monitor / analyse rates tariffs levied

27 27

Monitor revision of rates policy / by-law

27 27

Monitor and assist the general valuation implementation

22 10 Only ten (10) implemented this financial year

The planned target include two financial years, therefore the figure is overstated.

Monitor and assist the general valuation objection processes

22 1 No objections were forthcoming.

The total for objections were overstated, hence we were only faced with three (3)

Monitor and assist the general valuation appeal processes

7 3 The target for this financial year was only three (3) municipalities




62

Attend valuation ap-peal board hearings where organized



Monitor and assist supplementary valu-ation implementation







ActualAchievement

2012 / 2013

Deviation fromplanned target

to Actual Achievement

for2012 / 2013


Monitor and assist the supplementary valuation objection processes



Monitor and assist sup-plementary valuation appeal processes



Attend valuation appeal board hearings where organized

5 0 The Appointment of VAB members took place in Feb-ruary 2013, hence no board hearings were organized.

5 Valuation appeal boards monitored.

5 5



63

Co-Operative GovernanceDisaster Management






ment for2012 / 2013


Number of Fully Operational Provincial Disaster Management Centres established

1 0 Identified Building occupied by Traditional Affairs Directorate

No Budget to re-construct cur-rent Disaster Man-agement Offices

Number of Provincial Disaster Management Advisory Forum (PD-MAF) meetings

4 4






ment for2012 / 2013


Number of Provincial Disaster Risk Profiles

1 0 Budget con-straints to appoint a Service Provider for con-solidation

4 x District Munic-ipalities completed Disaster Risks profiles

Number of municipal-ities with applicable Disaster Management Frameworks and Plans

24 24

Number of Contingen-cy Plans developed for Identified Risks / Hazards

8 3 Assistant Di-rector: Disaster Management Operations trans-ferred in Dept.

Post not filled – Official responsible transferred with budget

Number of completed Date Needs Systems will organs of state

1 0 Budget con-straints and ca-pacity in Disaster Management Unit

NDMC will assist PDMC in 2013 / 14 Financial Year to implement a Data Needs System



64

Number of Training and Public Awareness programmes developed by PDMC for 5 District Municipalities

8 5 Budget con-straints in Depart-ment

Awareness programmes will continue in 2013 / 14 Financial Year

Number of Business Plans for Disaster Management and Fire Services submitted to PDMC

5 5



65

Programme 4: Traditional Affairs • Monitor the implementation of the roll out of the Northern Cape Traditional Leadership and Governance Act• Promote good governance with the coordination and assistance of traditional leaders that is people centered and improves the

quality of life of all the citizens of the province in particular the traditional areas of John Taolo Gaetsewe.• Ensure the efficient and effective establishment of a directorate of traditional leadership and institutions• Establishing a house of traditional leadership• Render administration support to Traditional Councils, communities and both Houses of traditional leadership• Drawing and updating genealogies of the Royal Families• Constitution and Reconstitution of Traditional councils

Strategic ObjectiveRender efficient and effective administrative and financial management support to monitor implementation of policies and programmes regarding traditional affairs.

Provincial House of Traditional Affairs SecretariatStrategic objectives Actual


Planned Target

2012 / 2013




2012 / 2013


To render efficient and effective admin-istrative and financial management support to monitor imple-mentation of policies and programmes regarding traditional institutions

Quarterly Pro-vincial house meetings (4)

Traditional Leadership Act is being implemented.

80%NCP Reg-ulations on Traditional leadership and institutions , Section 7(a) amended to address reconstitution of TC’s and Houses as promulgated by Minister

Awaiting the finalization of amendments to National Legisla-tion spearhead-ed by National Dept.Situation under control and process of voter registration continuedAppointment of Auditors to audit the account and compile financial statements still outstanding

Fast tracking of proposed amendment to the frame-work Act and the National House Act to include Khoisan communities by National Dept. Provincial House and Local House of Traditional Leaders ReconstitutedElection took place on 23 February 2013 in 7 out of the 8 traditional councils. 1 TC (Ba Ga Thaganya-ne) failed to reconstitute due to limited number of registered candidates. IEC will conduct election on 4 May 2013, thereafter acting Premier expected to publish names of newly elected councillors in the NC Provincial Gazette

1 1

Local house meeting 2 meetings per annum

2



66

Strategic objectives Actual Achievement 2011 / 2012

Planned Target

2012 / 2013




2012 / 2013


0 2

2 special meetings and 2 MANCO meeting

4

1 meeting

4 / as organised by National House

Traditional Community Development Strategic objectives Actual







To render efficient and effective admin-istrative and finan-cial management support to monitor implementation of policies and pro-grammes regarding traditional institu-tions

24 Traditional leaders 15 Staff

8

15 Traditional leaders and 2 staff members trained in Kuruman

LGSeta committed to fund training however insisted on appointing accredit-ed service provider. Most previously accredited service providers have been deregistered.

Managed to iden-tify one service provider who is still to be issued with an accredita-tion certificate

Encourage partner-ships with other Departments by inviting them to pro-grammes applicable to them and estab-lish good working relationships with all Municipalities in the NC

4 4

27 28

1 Royal council 2

Update when applicable

Update when appli-cable



67

Linking performance with budgetsSub-programme expenditure

Programme 1: Administration Office of the MEC

2011 / 2012 2012 / 2013Sub- Pro-gramme Name :Office Of The MEC

Final Appropriation

ActualExpenditure

(Over) / Under Expenditure

Final Appropriation

ActualExpenditure

(Over) / Under Ex-penditure

R’000 R’000 R’000 R’000 R’000 R’000

Current payment 10,140 10,072 68 9,166 8,871 295

Transfers and subsidies R 1 R 1 - R 90 (90)

Payment for capital assets R 700 R 70 R 630 R 575 R 754 (179)

Payment for financial assets

Total 10,841 10,143 698 9,741 9,715 26

Corporate Services

2011 / 2012 2012 / 2013Sub- Pro-gramme Name: Corporate Services

Final Appropriation

ActualExpenditure


Final Appropriation

ActualExpenditure

(Over) / Un-der Expendi-

ture

R’000 R’000 R’000 R’000 R’000 R’000

Current payment 84,988 78,792 6,196 58,623 64,675 (6,052)

Transfers and subsidies 103 103 - 229 229 -

Payment for capital assets 1,100 373 727 2,198 2,019 179

Payment for financial assets - -

Total 8,6191 79,268 6,923 61,050 66,923 (5,873)



68

Programme 2: Human Settlements, Planning and Research

2012 / 2013

Sub- Pro-gramme Name: Housing Needs Research and Planning

Final Appropriation

ActualExpenditure


Final Appropriation

ActualExpenditure


R’000 R’000 R’000 R’000 R’000 R’000

Current payment 8,026 7,963 R 63 15,506 13,925 1,581

Transfers and subsidies 1 1 -

Payment for capital assets 100 100 - 135 135


Total 8,127 8,064 63 15,641 13,925 1,716

Housing Development

2011/ 2013 2012 / 2013Sub- Pro-gramme Name: Housing Devel-opment

Final Appropriation

ActualExpenditure


Final Appropriation

ActualExpenditure


R’000 R’000 R’000 R’000 R’000 R’000

Current payment 19,069 18,707 362 18,868 17,962 906

Transfers and subsidies 337,195 337,195 - 331,410 330,822 588

Payment for capital assets 600 8 592 217 217


Total 356,865 355,910 954 350,495 348,784 1711



69

Housing Assets Management

2012 / 2013

Sub- Pro-gramme Name: Housing Asset Management

Final Appropriation

ActualExpenditure


Final Appropriation

ActualExpenditure


R’000 R’000 R’000 R’000 R’000 R’000

Current pay-ment 7,373 7,346 27 3,703 6,191 (2,488)

Transfers and subsidies 2,356 2,356 - 1,579 2,952 (1,373)

Payment for capital assets 100 100 42 42


Total 9,829 9,702 127 5,324 9,143 (3,819)

Programme 3: Local Governance

2012 / 2013Sub- Pro-gramme Name: Local Gover-nance

Final Appropriation

ActualExpenditure


Final Appropriation

ActualExpenditure

(Over) / Under Expen-

diture

R’000 R’000 R’000 R’000 R’000 R’000

Current payment 84,343 83,324 1,019 73,378 85,514 (12,136)

Transfers and subsidies 7,363 5,655 1,708 10,000 22,554 (12,554)

Payment for capital assets 900 900 38 38 -


Total 92,606 88,979 3,627 83,416 108,106 (24,690)



70

Development Planning

2012 / 2013Sub- Pro-

gramme Name: Development And Planning

Final Appropriation

ActualExpenditure


Final Appropriation

ActualExpenditure


R’000 R’000 R’000 R’000 R’000 R’000

Current payment 14,515 14,515 - 28,547 16,383 12,164

Transfers and subsidies - - 20,288 5,192 15,096

Payment for capital assets 200 22 178 822 96 726

Payment for financial assets - - -

Total 14,715 14,537 178 49,657 21,671 27,986

Programme 4: Traditional Affairs

2012 / 2013Sub- Pro-

gramme Name: Traditional

Affairs

Final Appropriation

ActualExpenditure


Final Appropriation

ActualExpenditure


ture

R’000 R’000 R’000 R’000 R’000 R’000

Current payment 12,758 12,919 (161) 10,399 10,077 322

Transfers and subsidies 980 1,098 (118) 933 1,197 (264)

Payment for capital assets 1,600 1,321 279 1,620 1,620

Payment for financial assets - - -

Total 15,338 15,338 - 12,952 11,274 1,678



71

5. SUMMARY OF FINANCIAL INFORMATION

5.1. Departmental receipts

2011 / 2012 2012 / 2013

Departmental receipts Estimate

Actual Amount Col-

lected

(Over) / Under Collection Estimate Actual

Amount Col-lected

(Over) / Under

Collection

R’000 R’000 R’000 R’000 R’000 R’000

Tax Receipts

Casino taxes

Horse racing taxes

Liquor licences

Motor vehicle licences

Sale of goods and services other than capi-tal assets

232 405 (173) 221 372 (151)

Transfers received

Fines, penalties and forfeits

Interest, divi-dends and rent on land

85 11 74

Sale of capital assets 89 89 260 (260)

Financial trans-actions in assets and liabilities

131 52 79 125 101 24

Total 452 457 (5) 431 744 (313)



72

5.2. Programme Expenditure

2012 / 2013Administration Final

AppropriationActual

Expenditure(Over) / Under Expenditure

Final Appropriation

ActualExpenditure


R’000 R’000 R’000 R’000 R’000 R’000

Current pay-ment 95,128 88,864 6,264 67,789 73,546 (5,757)

Transfers and subsidies 104 104 - 229 319 (90)

Payment for capital assets 1,800 443 1,357 2,773 2,773 -

Payment for financial assets - - - - - -

Total 97,032 89,411 7,621 70,791 76,638 (5,847)

Human Settlements

2012 / 2013 2012 / 2013

Human Settle-ments

Final Appropriation

ActualExpenditure


Final Appropriation

ActualExpenditure


ture

R’000 R’000 R’000 R’000 R’000 R’000

Current pay-ment 34,468 34,016 452 38,077 38,078 (1)

Transfers and subsidies 339,552 339,552 - 332,989 333,774 (785)

Payment for capital assets 800 108 692 394 - 394


Total 374,820 373,676 1,144 371,460 371,852 (392)



73

Traditional Affairs

2012 / 2013 2011 / 2012

Traditional Affairs

Final Appropriation

ActualExpenditure


Final Appropriation

ActualExpendi-

ture


R’000 R’000 R’000 R’000 R’000 R’000

Current pay-ment 12,758 12,919 (161) 10,399 10,077 322

Transfers and subsidies 980 1,098 (118) 933 1,197 (264)

Payment for capital assets 1,600 1,321 279 1,620 - 1,620


Total 15,338 15,338 - 12,952 11,274 1,678

5.3. Transfer payments, excluding public entities None

5.4. Conditional grants and earmarked funds received Conditional Grant Human Settlement Development Current

Department who transferred the grant National department of Human Settlements

Purpose of the grant To finance the implementation of National Housing Pro-grammes, for the creation of sustainable human

Expected outputs of the grant 2704

Actual outputs achieved 2839

Amount per amended DORA

Amount received (R’000) R 339 000.00

Reasons if amount as per DORA was not received N/A

Amount spent by the department (R’000) R 339 539 516.57

Reasons for the funds unspent by the entity R 11 483.43

Monitoring mechanism by the receiving department Monthly reporting to National Human Settlement

6.5. Donor Funds None

6.6. Capital investment, maintenance and asset management plan None





74

PART C: GOVERNANCE





75

AUDIT COMMITTEE REPORT

1. REPORT OF THE AUDIT COMMITTEEWe are pleased to present our report for the financial year ended 31 March 2013. The Audit Committee was operational throughout the year and had several engagements with management on crucial financial man-agement, internal control, risk management and governance issues during the year. The Audit Committee acknowledges the attendance and participation of senior management including the Accounting Officer in the Audit Committee meetings.

2. AUDIT COMMITTEE MEMBERS AND ATTENDANCEIn terms of PFMA, section 77(b), an audit committee must meet at least twice a year. In addition, Treasury Regulations, section 3.1.16, provides that an audit committee must meet at least annually with the Auditor – General. The audit committee met five times during the year in compliance with the PFMA and also met with the Auditor General.

The Names of the members of the audit committee as well as the number of meetings attended by the mem-bers are tabulated below:

Name of members Designation Number of meetings attended

1 Mr. Hyacinth Chineme Ogu Chairperson 5 out of 5

2. Mr. Geoffrey Tshepo Pharasi Internal Member 1 out of 5

4 Mr. Zola Luxolo Fahlani Independent Member 5 out of 5

3. AUDIT COMMITTEE RESPONSIBILITYThe Audit Committee reports that it has compiled with its responsibilities arising from Section 38 (1) (a) (ii) of the Public Finance Management Act and Treasury Regulation 3.1.13. The Audit Committee also reports that it has adopted appropriate formal terms of reference as its Audit Committee Charter, has regulated its affairs in compliance with this charter and has discharged all its responsibilities as contained therein.

4. THE EFFECTIVENESS OF INTERNAL CONTROL Our review of the findings of the Internal Audit work, which was based on the risk assessments conducted in the department revealed certain weaknesses, which were then raised with the Department.

The following internal audit assignments were completed during the year under review:• Financial management- payments of service providers





76

• Financial management- supply chain management

• Financial management- travel claims

• Human Settlement- contract management

• Transfer payments

• Human settlement- subsidy variation claims

• Audit of performance Information

• High level review of interim financial statements for the period ended 30/09/2012

• Verification of Management Performance Assessment Tool (MPAT)

• Verification of BAS security (access profiles)

The following were areas of concern:1. Significant number of invoices not paid within 30 days as required by Treasury Regulations 8.2.3

2. Some invoices were not provided to the auditors. In addition, the Department does not perform regular reconciliation of service providers’ accounts.

3. Inadequate internal control for linking the authorization requisitions to the cash flow of the Depart-ment.

4. Supporting documents for some transactions could not be provided.

5. The Supply Chain Management Policy of the Department is outdated as it was last reviewed and updated in March 2010.

6. Inadequate reconciliation of the asset register to the actual assets

7. Ineffective controls over the management of the subsidized vehicle scheme as well as travel claims

8. Inadequate and ineffective controls over the management of contracts

9. In a instance, no supporting documentation could be provided for transfer payment made

10. Effective controls were not implemented to ensure correct allocation of transfer payments

11. Instance of payment in advance to a contractor was noted

12. Inadequate and ineffective document management system for transfer payments.

13. No policy and standard operating procedures are in place for performance management resulting in lack of consistency in the method of collection of performance information

14. The performance reports were not always submitted to Treasury

15. Reasons, action plans and revised target dates were not completely documented in cases of non-achievement of objectives

16. Supporting documentation for some indicators were either not available or did not correspond with what was reported.

17. The implementation of good practices as far as BAS is concerned is challenged therefore limited reliance can be placed on the management of BAS access profiles in terms of the prescripts within the department.





77

Management has lower develop a pragmatic action plan to address the above issues within a reasonable time period.

5. IN -YEAR MANAGEMENT AND MONTHLY/QUARTELY REPORTThe department has been reporting monthly and quarterly to the Treasury as required by the PFMA. Quarterly reports were also submitted and presented to the Audit Committee.

6. EVALUATION OF FINANCIAL STATEMENTS6.1 The audit committee has reviewed the unaudited financial statements for the year ended 31 March 2013 and has discussed matters of concern with the management. The audit committee has further reviewed the audited financial statements and discussed the statements with the Auditor- General as well as the Accounting Officer.

6.2 The audit committee has reviewed the Auditor-General’s management report and management responses thereto. In addition, the audit committee has reviewed the preliminary action plan by management to address issues raised by the Auditor- General and has directed management to prepare detailed action plan for the review and approval of the audit committee.

6.3 The audit committee reviewed the accounting policies as well as changes in accounting policies and practices as part of the review of the audited financial statements and noted that the accounting policies were appropriate for the department.

6.4 The audit committee reviewed the department’s compliance with legal and regulatory provisions during the quarterly audit committee meetings and management has been directed to implement remedial measures where instances of non compliance were noted.

6.5 The audit committee reviewed the information on predetermined objectives to be included in the annual report as part of the review of the audited financial statements.

6.6 The audit committee discussed significant adjustments resulting from the audit with management and the Auditor-General as part of the review of the audited financial statements.

6.7 The audit committee concurs with the Auditor – General’s conclusion on the annual financial statement as well as the unqualified audit opinion of the Auditor-General on the financial statements.

7. INTERNAL AUDITThe audit committee is satisfied as to effectiveness of internal audit function during the year and hereby notes with satisfaction that the internal audit activity has to a large extent addressed the risks pertinent to the Department.

8. AUDITOR- GENERAL SOUTH AFRICAWe have reviewed the Department’s implementation plan for audit issues raised in the prior year and we are satisfied that the matters have been adequately resolved except for the following:

• Payment of invoices within 30 days

• Reconciliation of assets

• Not all policies have been approved





78

• Under- achievement of targets on APP

The audit committee met with representatives from the Office of the Auditor – General South Africa during the year to discuss issues of mutual concern and ensure that there are no unresolved issues.

C. OguChairperson of the Audit Committee

Date:



79

PART D:

HUMAN RESOURCE MANAGEMENT



80

1. Human Resource Oversight Statistics

1.1. Personnel Related Expenditure

Table 1.1.1 Personnel expenditure by programme

Programme Total Voted Expenditure

(R’000)

Compensation of Employees Expenditure

(R’000)

Training Expenditure

(R’000)

Professional and Special

Services (R’000)

Compen-sation of

Employees as percent of Total Expen-

diture

Average Com-pensation of Employees

Cost per Employee (R’000)

Employm

ent

Nha: adminis-tration 89,411 54,179 0 0 60.6 83 654

Nha: co-oper-ative gover-

nance 103,516 85,010 0 0 82.1 130 654

Nha: human settlements

373,677 30,635 0 0 8.2 47 654

Nha: traditil intitutinl de-velopment

15,337 10,402 0 0 67.8 16 654

Z=Total as on Financial Sys-tems (BAS)

581,941 180,226 0 0 31 276 654

Table 1.1.2 Personnel costs by salary band

Salary BandsCompensation of Employees Cost

(R’000)

Percentage of To-tal Personnel Cost

for Department

Average Compen-sation Cost per Employee (R)

Total Personnel Cost for Depart-ment including

Goods and Trans-fers (R’000)

Number of Employees

Skilled (Levels 3-5) 5,639 3.1 137,537 184,688 41

Highly skilled production (Levels 6-8)

102,604 55.6 216,922 184,688 473

Highly skilled su-pervision (Levels 9-12)

44,801 24.3 400,009 184,688 112

Senior manage-ment (Levels 13-16)

18,108 9.8 953,053 184,688 19

Contract (Levels 3-5) 214 0.1 214,000 184,688 1

Contract (Levels 6-8) 594 0.3 297,000 184,688 2



81

Salary BandsCompensation of Employees Cost

(R’000)

Percentage of To-tal Personnel Cost

for Department

Average Compen-sation Cost per Employee (R)

Total Personnel Cost for Depart-ment including

Goods and Trans-fers (R’000)

Number of Employees

Contract (Levels 9-12) 1,401 0.8 700,500 184,688 2

Contract (Levels 13-16) 3,317 1.8 829,250 184,688 4

Periodical Remu-neration 236 0.1 2,878 184,688 82

Abnormal Ap-pointment 3,312 1.8 82,800 184,688 40

TOTAL 180226 97.6 232250 184688 776

Table 1.1.3 Salaries, Overtime, Home Owners Allowance and Medical Aid by programme

Programme

Salaries Overtime Home Owners Allowance Medical Aid

Amount (R’000)

Salaries as a % of personnel

costs

Amount (R’000)

Overtime as a % of personnel

costs

Amount (R’000)

HOA as a % of personnel

costs

Amount (R’000)

Medi-cal aid as a % of per-sonnel costs

P1 Administra-tion 39980 71.1 23 0 1808 3.2 4.7 2668

P2 Human Settlement 22668 70.9 0 0 969 3 4.4 1403

P3 Co-Opera-tive governance 60732 70.8 7 70 3792 4.4 6.8 5810

P4 Traditional Affairs 8501 79.6 0 00 202 1.9 1.8 193

TOTAL 131881 71.4 30 0 6771 3.7 5.5 10074



82

Table 1.1.4 Salaries, Overtime, Home Owners Allowance and Medical Aid by salary band

Salary Bands

Salaries Overtime Home Owners Allowance Medical Aid

Amount (R’000

Salaries as a % of personnel

costs

Amount (R’000)

Overtime as a % of personnel

costs

Amount (R’000)

HOA as a % of

personnel costs

Amount (R’000)

Medical aid as a % of person-

nel costs

Skilled (level 3-5) 3858 68.1 0 0 377 6.7 540 9.5

Highly skilled production (levels 6-8)

72708 70.5 19 0 4664 4.5 7776 7.5

Highly skilled supervision (levels 9-12

33400 72 11 0 1023 2.2 1541 3.3

Senior management (level 13-16)

14388 73.3 0 0 534 2.7 188 1

Contract (Lev-els 1-2)

Contract (Lev-els 3-5) 211 99.5 1 0.5 0 0 0 0

Contract (Lev-els 6-8) 594 100 0 0 0 0 0 0

Contract (Lev-els 9-12) 1077 67.2 0 0 10 0.6 9 0.6

Contract (Lev-els 13-16) 2554 66.6 0 0 164 4.3 20 0.5

Periodical Remunera-

tion 0 0 0 0 0 0 0 0

Abnormal Appointment 3093 93.2 0 0 0 0 0 0

TOTAL 131883 71.4 31 0 6772 3.7 10074 5.5



83

1.2. Employment and Vacancies

Table 1.2.1 Employment and vacancies by programme

ProgrammeNumber of posts on approved establish-

mentNumber of posts filled Vacancy Rate

Number of employ-ees additional to the

establishment

P1 Administration 186 171 8.1 0

P2 Human Settlement 98 93 5.1 0

P3 Co-Operative Gov-ernance 390 367 5.9 0

P4 Traditional Affairs 27 23 14.8 0

Total 701 654 6.7 0

Table 1.2.2 Employment and vacancies by salary band

Salary band Number of posts on

approved establishment

Number of posts filled Vacancy RateNumber of employ-

ees additional to the establishment

Lower skilled ( 1-2)

Skilled(3-5) 44 41 6.8 0

Highly skilled produc-tion (6-8) 499 473 5.2 0

Highly skilled supervi-sion (9-12) 125 112 10.4 0

Senior management (13-16) 24 19 20.8 0

Contract (Levels 1-2)

Contract (Levels 3-5) 1 1 0 0





84

Salary band Number of posts on

approved establishment

Number of posts filled Vacancy RateNumber of employ-

ees additional to the establishment


TOTAL 701 654 6.7 0

Table 1.2.3 Employment and vacancies by critical occupations

Critical Occupations Number of Posts

Number of Posts Filled

Vacancy Rate

Number of Posts Filled Additional to the Establishment

Administrative related, Permanent 120 108 10 0

All artisans in the building metal machinery etc., Permanent 1 1 0 0

Appraisers-valuers and related professionals, Permanent 3 3 0 0

Architects town and traffic planners, Permanent 1 1 0 0

Cartographic surveying and related technicians, Permanent 2 2 0 0

Cleaners in offices workshops hospitals etc., Permanent 7 6 14.3 0

Client inform clerks(switchb recept inform clerks), Permanent 4 4 0 0

Communication and information related, Perma-nent 1 1 0 0

Community development workers, Permanent 19 11 42.1 0

Diplomats, Permanent 1 1 0 0

Engineers and related professionals, Permanent 3 2 33.3 0

Finance and economics related, Permanent 5 5 0 0

Financial and related professionals, Permanent 2 0 100 0

Financial clerks and credit controllers, Permanent 35 34 2.9 0

Food services aids and waiters, Permanent 2 2 0 0

General legal administration & rel. professionals, Permanent 1 1 0 0

Human resources & organisat developm & relate prof, Permanent 3 3 0 0

Human resources clerks, Permanent 2 2 0 0

Human resources related, Permanent 30 26 13.3 0

Information technology related, Permanent 1 1 0 0



85

Critical Occupations Number of Posts

Number of Posts Filled Vacancy Rate

Number of Posts Filled Additional to the Estab-

lishment

Inspectors of apprentices works and vehicles, Permanent 13 13 0 0

Legal related, Permanent 2 2 0 0

Library mail and related clerks, Permanent 7 7 0 0

Logistical support personnel, Permanent 6 5 16.7 0

Material-recording and transport clerks, Perma-nent 3 3 0 0

Messengers porters and deliverers, Permanent 8 7 12.5 0

Other administrat & related clerks and organisers, Permanent 298 297 0.3 0

Other administrative policy and related officers, Permanent

67 60 10.4 0

Other information technology personnel., Perma-nent

3 3 0 0

Other occupations, Permanent 4 4 0 0

Risk management and security services, Perma-nent

3 2 33.3 0

Secretaries & other keyboard operating clerks, Permanent

14 13 7.1 0

Senior managers, Permanent 26 21 19.2 0

Trade quality controllers, Permanent 4 3 25 0

TOTAL 701 654 6.7 0

1.3. Job EvaluationTable 1.3.1 Job Evaluation by Salary band

Salary Band

Number of Posts

Number of Jobs

Evaluated

% of Posts Eval-

uated

Number of Posts

Upgraded

% of Upgraded

Posts Evaluated

Number of Posts

Downgraded

% of Dow

ngraded Posts Evaluated

Contract (Levels 3-5) 1 0 0 0 0 0 0

Contract (Levels 6-8) 2 0 0 0 0 0 0

Contract (Levels 9-12) 2 0 0 0 0 0 0

Contract (Band A) 4 0 0 0 0 0 0

Skilled (Levels 3-5) 44 5 11.4 5 100 0 0

Highly skilled production (Levels 6-8) 499 1 0.2 1 100 0 0

Highly skilled supervision (Levels 9-12) 125 11 8.8 4 36.4 0 0



86

Senior Management Service Band A 18 1 5.6 0 0 0 0

Senior Management Service Band B 4 0 0 0 0 0 0

Senior Management Service Band C 1 0 0 0 0 0 0

Senior Management Service Band D 1 0 0 0 0 0 0

TOTAL 701 18 2.6 10 55.6 0 0

Table 1.3.2 Profile of employees whose positions were upgraded due to their posts being upgraded

Beneficiaries African Asian Coloured White Total

Female 5 0 5 0 10

Male 7 0 3 2 12

Total 12 0 8 2 22

Employees with a Disability 0 0 0 0 0

Table 1.3.3 Employees with salary levels higher than those determined by job evaluation by occupation

Occupation Number of Employees

Job Evaluation Level

Remuneration Level

Reason for Deviation

No of Employ-ees in Dept

xxx 0 xxx xxx xxx

xxx 0 xxx xxx xxx

Total 0

Percentage of Total Employment 0 0

Table 1.3.4 Profile of employees who have salary levels higher than those determined by job evaluation

Beneficiaries African Asian Coloured White Total

Female 0 0 0 0 0

Male 0 0 0 0 0

Total 0 0 0 0 0

Employees with a Disability 0 0 0 0 0

Total Number of Employees whose remuneration exceeded the grade determined by job evaluation in 2012 / 2013 -



87

1.4. Employment Changes

Table 1.4.1 Annual turnover rates by salary band

Salary Band

Employment at Beginning

of Period (April 2012)

Appointments Terminations Turnover Rate

Skilled (Levels 3-5), Permanent 39 2 1 2.6

Highly skilled production (Levels 6-8), Permanent 480 9 12 2.5

Highly skilled supervision (Levels 9-12), Permanent 99 8 4 4

Senior Management Service Band A, Permanent 16 1 1 6.3

Senior Management Service Band B, Permanent 4 0 1 25

Senior Management Service Band C, Permanent 1 0 0 0

Senior Management Service Band D, Permanent 1 0 0 0

Contract (Levels 3-5), Permanent 2 0 2 100



Contract (Band A), Permanent 4 0 0 0

TOTAL 651 21 21 3.2

Table 1.4.2 Annual turnover rates by critical occupation

Occupation



Appointments

Terminations

Turnover Rate

Administrative related, Permanent 90 8 2 2.2

All artisans in the building metal machinery etc., Permanent 1 0 0 0

Appraisers-valuers and related professionals, Permanent 5 0 1 20

Architects town and traffic planners, Permanent 1 0 0 0

Cartographic surveying and related technicians, Permanent 2 0 0 0

Cleaners in offices workshops hospitals etc., Permanent 5 0 1 20

Client inform clerks(switchb recept inform clerks), Permanent 4 0 0 0

Communication and information related, Permanent 1 0 0 0

Community development workers, Permanent 11 0 0 0

Engineers and related professionals, Permanent 4 0 0 0

Finance and economics related, Permanent 4 1 0 0

Financial and related professionals, Permanent 1 0 0 0



88

Occupation



Appointments

Terminations

Turnover Rate

Financial clerks and credit controllers, Permanent 37 1 1 2.7

Food services aids and waiters, Permanent 2 0 0 0

General legal administration & rel. professionals, Permanent 1 0 0 0

Human resources & organisat developm & relate prof, Permanent 4 0 0 0

Human resources clerks, Permanent 1 0 0 0

Human resources related, Permanent 22 2 0 0

Information technology related, Permanent 1 0 0 0

Inspectors of apprentices works and vehicles, Permanent 12 1 0 0

Legal related, Permanent 2 0 0 0

Library mail and related clerks, Permanent 5 0 0 0

Logistical support personnel, Permanent 5 0 0 0

Material-recording and transport clerks, Permanent 2 0 0 0

Messengers porters and deliverers, Permanent 4 1 0 0

Other administrat & related clerks and organisers, Permanent 314 1 12 3.8

Other administrative policy and related officers, Permanent 65 2 1 1.5

Other information technology personnel., Permanent 3 0 0 0

Other occupations, Permanent 4 1 1 25

Risk management and security services, Permanent 1 0 0 0

Secretaries & other keyboard operating clerks, Permanent 12 2 0 0

Security officers, Permanent 1 0 0 0

Senior managers, Permanent 22 1 2 9.1

Trade quality controllers, Permanent 2 0 0 0

TOTAL 651 21 21 3.2NotesThe CORE classification, as prescribed by the DPSA, should be used for completion of this table.The table below identifies the major reasons why staff left the department.



89

Table 1.4.3 Reasons why staff left the department

Termination Type NumberPercentage of

Total Resignations

Percentage of Total

EmploymentTotal Total

Employment

Death, Permanent 2 9.5 0.3 21 651

Resignation, Permanent 13 61.9 2 21 651

Expiry of contract, Permanent 3 14.3 0.5 21 651

Dismissal-misconduct, Permanent 1 4.8 0.2 21 651

Retirement, Permanent 2 9.5 0.3 21 651

TOTAL 21 100 3.2 21 651

Table 1.4.4 Promotions by critical occupation

OccupationEm

ployment at

Beginning of Period

(April 2012)

Promotions to

another Salary Level

Salary Level Pro-m

otions as a % of

Employm

ent

Progressions to another Notch w

ithin Salary Level

Notch progres-sions as a %

of Em

ployment

Administrative related 90 9 10 44 48.9

All artisans in the building metal machinery etc. 1 0 0 1 100

Appraisers-valuers and relat-ed professionals 5 0 0 4 80

Architects town and traffic planners 1 0 0 1 100

Cartographic surveying and related technicians 2 0 0 1 50

Cleaners in offices work-shops hospitals etc. 5 0 0 1 20

Client inform clerks(switchb recept inform clerks) 4 0 0 2 50

Communication and informa-tion related 1 0 0 1 100

Community development workers 11 1 9.1 9 81.8

Engineers and related profes-sionals 4 0 0 2 50



90

OccupationEmployment at Be-ginning of Period

(April 2012)

Promotions to another Salary

Level

Salary Level Promotions as a % of

Employment

Progressions to another Notch within Salary

Level

Notch progres-sions as a % of

Employment

Finance and economics related 4 0 0 2 50

Financial and related profes-sionals 1 0 0 1 100

Financial clerks and credit controllers 37 1 2.7 29 78.4

Food services aids and waiters 2 0 0 2 100

General legal administration & rel. professionals 1 0 0 1 100

Human resources & organi-sat developm & relate prof 4 0 0 3 75

Human resources clerks 1 0 0 0 0

Human resources related 22 1 4.5 18 81.8

Information technology related 1 1 100 0 0

Inspectors of apprentices works and vehicles 12 0 0 11 91.7

Legal related 2 0 0 1 50

Library mail and related clerks 5 0 0 3 60

Logistical support personnel 5 0 0 2 40

Material-recording and trans-port clerks 2 0 0 2 100

Messengers porters and deliverers 4 0 0 4 100

Other administrat & related clerks and organisers 314 1 0.3 126 40.1

Other administrative policy and related officers 65 1 1.5 46 70.8



91

OccupationEmployment at Be-ginning of Period

(April 2012)

Promotions to another Salary

Level


Employment

Progressions to another Notch within Salary

Level

Notch progres-sions as a % of

Employment

Other information technology personnel. 3 0 0 1 33.3

Other occupations 4 0 0 1 25

Risk management and secu-rity services 1 0 0 0 0

Secretaries & other keyboard operating clerks 12 0 0 12 100

Security officers 1 0 0 0 0

Senior managers 22 0 0 11 50

Trade quality controllers 2 0 0 1 50

TOTAL 651 15 2.3 343 52.7



92

Table 1.4.5 Promotions by salary band

Salary Band



Promotions to another

Salary Level


Employment

Progressions to an-other Notch within

Salary Level

Notch progressions as a % of Employ-

ment

Skilled (Levels 3-5), Perma-nent 39 0 0 27 69.2

Highly skilled production (Levels 6-8), Permanent 480 4 0.8 250 52.1

Highly skilled supervision (Levels 9-12), Permanent 99 11 11.1 53 53.5

Senior management (Levels 13-16), Permanent 22 0 0 11 50

Contract (Levels 3-5), Perma-nent 2 0 0 0 0

Contract (Levels 6-8), Perma-nent 1 0 0 0 0

Contract (Levels 9-12), Per-manent 4 0 0 1 25

Contract (Levels 13-16), Permanent 4 0 0 1 25

TOTAL 651 15 2.3 343 52.7



93

1.5. Employment Equity

Table 1.5.1 Total number of employees (including employees with disabilities) in each of the following occupational categories as at 31 March 2014

Occupational Categories

Male, African

Male, Coloured

Male, Indian

Male, Total Blacks

Male, W

hite

Female, African

Female, Co-

loured

Female, Indian

Female, Total

Blacks

Female, W

hite

Total

Legisla-tors, senior officials and managers, Permanent

16 1 0 17 0 4 0 1 5 1 23

Profession-als, Perma-nent

11 6 0 17 3 25 8 1 34 2 56

Technicians and associate profession-als, Perma-nent

50 26 1 77 6 62 24 0 86 9 178

Clerks, Per-manent 88 62 1 151 0 122 84 0 206 3 360

Service and sales work-ers, Perma-nent

1 0 0 1 0 0 1 0 1 0 2

Craft and re-lated trades workers, Permanent

7 6 0 13 3 0 1 0 1 0 17

Elementary occupations, Permanent

7 1 0 8 0 7 3 0 10 0 18

TOTAL 180 102 2 284 12 220 121 2 343 15 654



94

Table 1.5.2 Total number of employees (including employees with disabilities) in each of the following occupational bands on 31 March 2014

Occupational Bands

Male, African

Male, Coloured

Male, Indian

Male, Total Blacks

Male, W

hite

Female, African

Female, Co-

loured

Female, Indian

Female, Total

Blacks

Female, W

hite

Total

Top Management, Permanent 1 0 0 1 0 0 0 0 0 0 1

Senior Manage-ment, Permanent 11 1 0 12 0 4 0 1 5 1 18

Professionally qualified and experienced

specialists and mid-management,

Permanent

36 17 0 53 10 28 15 1 44 5 112

Skilled technical and academically qualified workers,

junior manage-ment, supervi-sors, foremen,

Permanent

111 82 2 195 2 169 99 0 268 8 473

Semi-skilled and discretionary

decision making, Permanent

14 2 0 16 0 17 7 0 24 1 41

Contract (Senior Management),

Permanent 4 0 0 4 0 0 0 0 0 0 4

Contract (Profes-sionally qualified),

Permanent 1 0 0 1 0 1 0 0 1 0 2

Contract (Skilled technical), Perma-

nent 1 0 0 1 0 1 0 0 1 0 2

Contract (Semi-skilled), Perma-

nent 1 0 0 1 0 0 0 0 0 0 1

TOTAL 180 102 2 284 12 220 121 2 343 15 654



95

Table 1.5.3 Recruitment

Occupational Bands

Male, African

Male, Coloured

Male, Indian

Male, Total Blacks

Male, W

hite

Female, African

Female, Coloured

Female, Indian

Female, Total Blacks

Female, W

hite

Total

Senior Management, Permanent

1 0 0 1 0 0 0 0 0 0 1

Professionally qualified and experi-enced specialists and mid-management, Permanent

3 1 0 4 0 3 1 0 4 0 8

Skilled technical and academically qualified workers, junior man-agement, supervisors, foremen, Permanent

3 0 0 3 0 5 1 0 6 0 9

Semi-skilled and discretionary decision making, Permanent

1 0 0 1 0 1 0 0 1 0 2

Contract (Skilled technical), Permanent

1 0 0 1 0 0 0 0 0 0 1

TOTAL 9 1 0 10 0 9 2 0 11 0 21

Table 1.5.4 PromotionsOccupational Bands

Male, African

Male, Coloured

Male, Indian

Male, Total Blacks

Male, W

hite

Female, African

Female, Coloured

Female, Indian


Female, W

hite

Total

Senior Management, Permanent

7 1 0 8 0 1 0 1 2 1 11

Professionally qualified and experienced special-ists and mid-manage-ment, Permanent

16 9 0 25 9 18 6 1 25 5 64



96

Occupational Bands

Male, African

Male, Coloured

Male, Indian

Male, Total Blacks

Male, W

hite

Female, African

Female, Coloured

Female, Indian


Female, W

hite

Total

Skilled technical and academically qualified workers, junior man-agement, supervisors, foremen, Permanent

52 38 1 91 1 111 44 0 155 7 254

Semi-skilled and discre-tionary decision making, Permanent

8 2 0 10 0 10 6 0 16 1 27

Contract (Senior Manage-ment), Permanent

1 0 0 1 0 0 0 0 0 0 1

Contract (Professionally qualified), Permanent

1 0 0 1 0 0 0 0 0 0 1

TOTAL 85 50 1 136 10 140 56 2 198 14 358

Table 1.5.5 Terminations

Occupational Bands

Male, African

Male, Coloured

Male, Indian

Male, Total Blacks

Male, W

hite

Female, African

Female, Coloured

Female, Indian


Female, W

hite

Total

Senior Management, Per-manent 0 1 0 1 0 1 0 0 1 0 2

Professionally qualified and experienced specialists and mid-management, Perma-

nent

3 0 0 3 1 0 0 0 0 0 4

Skilled technical and aca-demically qualified workers, junior management, super-visors, foremen, Permanent

3 3 0 6 0 3 3 0 6 0 12

Semi-skilled and discre-tionary decision making,

Permanent 0 1 0 1 0 0 0 0 0 0 1

Contract (Semi-skilled), Permanent 2 0 0 2 0 0 0 0 0 0 2

TOTAL 8 5 0 13 1 4 3 0 7 0 21



97

Table 1.5.6 Disciplinary action

Disciplinary action

Male, African

Male, Coloured

Male, Indian

Male, Total Blacks

Male, W

hite

Female, African

Female, Coloured

Female, Indian

Female, Total

Blacks

Female, W

hite

Total

Not Available

TOTAL 0 0 0 0 0 0 0 0 0 0 0 0

Table 1.5.7 Skills development


Male, African

Male, Coloured

Male, Indian

Male, Total Blacks

Male, W

hite

Female, African

Female, Co-

loured

Female, Indian

Female, Total

Blacks

Female, W

hite

Total

Legislators, Senior Officials and Manag-ers

0 0 0 0 0 0 0 0 0 0 0

Professionals 0 0 0 0 0 0 0 0 0 0 0

Technicians and Asso-ciate Professionals 0 0 0 0 0 0 0 0 0 0 0

Clerks 0 0 0 0 0 0 0 0 0 0 0

Service and Sales Workers 0 0 0 0 0 0 0 0 0 0 0

Skilled Agriculture and Fishery Workers 0 0 0 0 0 0 0 0 0 0 0

Craft and related Trades Workers 0 0 0 0 0 0 0 0 0 0 0

Plant and Machine Operators and Assem-blers

0 0 0 0 0 0 0 0 0 0 0

Elementary Occupa-tions 0 0 0 0 0 0 0 0 0 0 0

TOTAL 0 0 0 0 0 0 0 0 0 0 0

Employees with disabilities 0 0 0 0 0 0 0 0 0 0 0



98

1.6. Performance RewardsTable 1.6.1 Performance Rewards by race, gender and disability

Demographics Number of Beneficiaries

Total Employment

Percentage of Total

EmploymentCost (R’000) Average Cost per

Beneficiary (R)

African, Female 67 213 31.5 730 10,898

African, Male 48 175 27.4 823 17,154

Asian, Female 1 2 50 22 21,725

Asian, Male 1 2 50 9 9,438

Coloured, Female 29 121 24 287 9,890

Coloured, Male 22 98 22.4 300 13,658

Total Blacks, Female 97 336 28.9 1,039 10,708

Total Blacks, Male 71 275 25.8 1,133 15,962

White, Female 10 15 66.7 133 13,282

White, Male 10 11 90.9 199 19,851

Employees with a disability 4 17 23.5 43 10,676

TOTAL 192 654 29.4 2,546 13,261

Table 1.6.2 Performance Rewards by salary band for personnel below Senior Manage-ment Service,

Salary Band Number of Beneficiaries

Total Employment

Percentage of Total


Beneficiary (R)

Skilled (Levels 3-5) 9 41 22 52 5,778


124 473 26.2 1,177 9,492

Highly skilled su-pervision (Levels 9-12)

51 112 45.5 908 17,804

Contract (Levels 3-5) 0 1 0 0 0



Periodical Remu-neration 0 82 0 0 0



99

Salary Band Number of Beneficiaries

Total Employment

Percentage of Total


Beneficiary (R)

Abnormal Ap-pointment 0 40 0 0 0

TOTAL 184 753 24.4 2137 11614

Table 1.6.3 Performance Rewards by Critical Occupation

Critical Occupations Number of Beneficiaries

Total Employment

Percentage of Total

EmploymentCost (R’000)

Average Cost per Beneficiary

(R)

Administrative related 40 108 37 677 16,925

All artisans in the building metal machinery etc. 1 1 100 12 12,000

Appraisers-valuers and related professionals 0 3 0 0 0

Architects town and traffic planners 1 1 100 40 40,000

Cartographic surveying and related technicians 2 2 100 24 12,000

Cleaners in offices workshops hospitals etc. 0 6 0 0 0

Client inform clerks(switchb recept inform clerks) 0 4 0 0 0

Communication and informa-tion related 0 1 0 0 0

Community development workers 3 11 27.3 21 7,000

Diplomats 0 1 0 0 0

Engineers and related profes-sionals 1 2 50 29 29,000

Finance and economics related 3 5 60 37 12,333

Financial clerks and credit controllers 18 34 52.9 177 9,833

Food services aids and waiters 1 2 50 4 4,000

General legal administration & rel. professionals 1 1 100 14 14,000

Human resources & organisat developm & relate prof 3 3 100 56 18,667

Human resources clerks 0 2 0 0 0

Human resources related 15 26 57.7 145 9,667



100

Critical Occupations Number of Beneficiaries

Total Employ-ment

Percentage of Total Employ-

mentCost (R’000)

Average Cost per Beneficiary

(R)

Information technology related 1 1 100 17 17,000

Inspectors of apprentices works and vehicles 12 13 92.3 167 13,917

Legal related 1 2 50 15 15,000

Library mail and related clerks 4 7 57.1 39 9,750

Logistical support personnel 3 5 60 31 10,333

Material-recording and trans-port clerks 1 3 33.3 8 8,000

Messengers porters and deliverers 2 7 28.6 10 5,000

Other administrat & related clerks and organisers 38 297 12.8 277 7,289

Other administrative policy and related officers 24 60 40 237 9,875

Other information technology personnel. 1 3 33.3 18 18,000

Other occupations 1 4 25 9 9,000

Risk management and security services 0 2 0 0 0

Secretaries & other keyboard operating clerks 6 13 46.2 62 10,333

Senior managers 8 21 38.1 409 51,125

Trade quality controllers 1 3 33.3 11 11,000

TOTAL 192 654 29.4 2546 13260

Table 1.6.4 Performance related rewards (cash bonus), by salary band for Senior Man-agement Service

SMS Band

Number of

Beneficiaries

Total Em

ployment

Percentage of Total

Employm

ent

Cost (R’000)

Average Cost per Beneficiary (R)

% of SM

S Wage

Bill

Personnel Cost SM

S (R’000)

Band A 7 20 35 320 45,714 1.8 17,714

Band B 1 2 50 89 89,000 2.8 3,190

Band D 0 1 0 0 0 0 0

TOTAL 8 23 34.8 409 51125 2 20904



101

1.7. Foreign Workers

Table 1.7.1 Foreign workers by salary band none

Table 1.7.2 Foreign workers by major occupation none

1.8. Leave Utilisation Table 1.8.1 Sick leave Jan 2012 to Dec 2012

Salary Band

Total Days

% Days w

ith Medical

Certification

Number of Em

ployees using Sick Leave

% of Total Em

ployees using Sick Leave

Average Days per Em

ployee

Estimated Cost (R’000)

Total number of

Employees using Sick

Leave

Total number of days

with m

edical certification

Skilled (Levels 3-5) 289 79.2 32 8.9 9 103 361 229

Highly skilled production (Levels 6-8) 1799 84 211 58.4 9 1,107 361 1512

Highly skilled supervision (Levels 9-12) 920 81 96 26.6 10 1,112 361 745

Senior management (Levels 13-16) 65 66.2 18 5 4 189 361 43

Contract (Levels 3-5) 9 100 2 0.6 5 3 361 9

Contract (Levels 6-8) 15 93.3 1 0.3 15 11 361 14

Contract (Levels 9-12) 1 0 1 0.3 1 2 361 0

TOTAL 3098 82.4 361 100 9 2527 361 2552



102

Table 1.8.2 Disability leave (temporary and permanent)

Salary Band

Total Days

% Days w

ith Medical Certi-

fication

Number of Em

ployees using Disability Leave

% of Total Em


Average Days per Employee

Estimated Cost (R’000)

Total number of days w

ith m

edical certification

Total number of Em


Skilled (Levels 3-5) 107 100 4 10.8 27 36 107 37

Highly skilled produc-tion (Levels 6-8) 363 100 24 64.9 15 236 363 37

Highly skilled supervi-sion (Levels 9-12) 249 100 9 24.3 28 257 249 37

TOTAL 719 100 37 100 19 529 719 37

Table 1.8.3 Annual Leave

Salary Band Total Days Taken Average days per Employee

Number of Employ-ees who took leave

Skilled (Levels 3-5) 763.68 19 41

Highly skilled production (Levels 6-8) 8470 18 479

Highly skilled supervision (Levels 9-12) 2384 21 113

Senior management (Levels 13-16) 516 23 22

Contract (Levels 3-5) 19 10 2




Not Available 1 1 1

TOTAL 12215.68 18 664



103

Table 1.8.4 Capped leave

Salary Band Total days of capped leave

taken

Average number of

days taken per employee

Average capped leave per employee

as at 31

Number of Em-ployees who took Capped

leave

Total number of capped

leave available at 31 Decem-

ber 2012

Number of Employees

as at 31 December

2012


22 4 26 6 1422 54

Highly skilled supervision (Levels 9-12)

5 3 31 2 1132 37

TOTAL 27 3 28 8 2554 91

Table 1.8.5 Leave payouts

ReasonTotal

Amount (R’000)

Number of Employees

Average Payment per Employee (R)

Capped leave payouts on termination of service for 2012 / 13 46 4 11500

Current leave payout on termination of service for 2012 / 13 0 6 0

TOTAL 46 10 4600

1.9. HIV / AIDS & Health Promotion ProgrammesTable 1.9.1 Steps taken to reduce the risk of occupational exposure

Units / categories of employees identified to be at high risk of contracting HIV & related diseases (if any) Key steps taken to reduce the risk

xxx xxx xxx xxx

Table 1.9.2 Details of Health Promotion and HIV / AIDS Programmes (tick the applicable boxes and provide the required information)

Question Yes No Details, if yes

1. Has the department designated a member of the SMS to implement the provisions con-tained in Part VI E of Chapter 1 of the Public Service Regulations, 2001? If so, provide her / his name and position.

X Mrs. ESD Boboko: Senior Manager; Human Capital Management



104

Question Yes No Details, if yes

2. Does the department have a dedi-cated unit or has it designated specific staff members to promote the health and well-being of your employees? If so, indicate the number of employees who are involved in this task and the annual budget that is available for this purpose.

X

Numberof employee: 7

Budget; None

3. Has the department introduced an Employee Assistance or Health Promotion Programme for your employees? If so, indicate the key elements / services of this Programme.

X

• Counselling• Gender, Disability• And HIV Management

4. Has the department established (a) com-mittee(s) as contemplated in Part VI E.5 (e) of Chapter 1 of the Public Service Regu-lations, 2001? If so, please provide the names of the members of the committee and the stakeholder(s) that they represent.

X

5. Has the department reviewed its em-ployment policies and practices to ensure that these do not unfairly discriminate against employees on the basis of their HIV status? If so, list the employment policies / practices so reviewed.

X

6. Has the department introduced mea-sures to protect HIV-positive employees or those perceived to be HIV-positive from discrimination? If so, list the key elements of these measures.

X

• Only HIV policy is in place.• Policy are marketed to employees

7. Does the department encourage its em-ployees to undergo Voluntary Counselling and Testing? If so, list the results that you have you achieved.

X

8. Has the department developed mea-sures / indicators to monitor & evaluate the impact of its health promotion programme? If so, list these measures / indicators.

X

1.10. Labour RelationsTable 1.10.1 Collective agreements

Subject Matter Date

xxx xxx

xxx xxx



105

Table 1.10.2 Misconduct and disciplinary hearings finalised

Outcomes of disciplinary hearings Number Percentage of Total Total

TOTAL 0 0 0

Table 1.10.3 Types of misconduct addressed at disciplinary hearings

Type of misconduct Number Percentage of Total Total

TOTAL 0 0 0

Table 1.10.4 Grievances logged

Number of grievances addressed Number Percentage of Total Total

TOTAL 0 0 0

Table 1.10.5 Disputes logged

Number of disputes addressed Number % of total

Upheld 0 0

Dismissed 0 0

Total 0

Table 1.10.6 Strike actions

Strike Actions _

Total number of person working days lost 0

Total cost(R’000) of working days lost 0

Amount (R’000) recovered as a result of no work no pay 0

Table 1.10.7 Precautionary suspensions

Precautionary Suspensions _

Number of people suspended 0

Number of people whose suspension exceeded 30 days 0

Average number of days suspended 0

Cost (R’000) of suspensions 0



106

1.11. Skills developmentTable 1.11.1 Training needs identified

Occupational Categories Gender

Employm

ent

Learnerships

Skills Pro-gram

mes &

oth-er short courses

Other forms of

training

Total

Legislators, senior officials and man-agers Female 0 0 13 0 13

Male 0 0 23 0 23

Professionals Female 0 0 22 0 22

Male 0 0 27 0 27

Technicians and associate profession-als Female 0 0 18 0 18

Male 0 0 16 0 16

Clerks Female 0 0 51 0 51

Male 0 0 42 0 42

Service and sales workers Female 0 0 0 0 0

Male 0 0 0 0 0

Skilled agriculture and fishery workers Female 0 0 0 0 0

Male 0 0 0 0 0

Craft and related trades workers Female 0 0 0 0 0

Male 0 0 0 0 0

Plant and machine operators and assemblers Female 0 0 0 0 0

Male 0 0 0 0 0

Elementary occupations Female 0 0 0 0 0

Male 0 0 0 0 0

Gender sub totals Female 0 0 104 0 104

Male 0 0 108 0 108

Total 0 0 212 212



107

Table 1.11.2 Training provided for the period


Gender

Employm

ent

Learnerships

Skills Pro-gram

mes &

other short

courses

Other forms of

training

Total

Legislators, senior officials and managers Female 0 0 13 0 13

Male 0 0 23 0 23

Professionals Female 0 0 22 0 22

Male 0 0 27 0 27

Technicians and associate professionals Female 0 0 18 0 18

Male 0 0 16 0 16

Clerks Female 0 0 51 0 51

Male 0 0 42 0 42

Service and sales workers Female 0 0 0 0 0

Male 0 0 0 0 0

Skilled agriculture and fishery workers Female 0 0 0 0 0

Male 0 0 0 0 0

Craft and related trades workers Female 0 0 0 0 0

Male 0 0 0 0 0

Plant and machine operators and assemblers Female 0 0 0 0 0

Male 0 0 0 0 0

Elementary occupations Female 0 0 0 0 0

Male 0 0 0 0 0

Gender sub totals Female 0 0 104 0 104

Male 0 0 108 0 108

Total 0 0 212 0 212



108

PART E:

FINANCIAL INFORMATION



109

ACCOUNTING OFFICER’S STATEMENT OF RESPONSIBILITY

Statement of Responsibility for the Annual Financial Statements for the year ended 31 March 2013

The Accounting Office is responsible for the preparation of the department’s annual financial statements and for the judgements made in this information.

The Accounting Officer is responsible for establishing, and implementing a system of internal control designed to provide reason-able assurance as to the integrity and reliability of the annual financial statements

In my opinion, the financial statements fairly reflects the operations of the department for the financial year ended 31 March 2013

The external auditors are engaged to express an independent opinion on the AFS of the department.

The Department of Cooperative Governance, Human Settlements Traditional Affairs AFS for the year ended 31 March 2013 have been examined by the external auditors and their report is presented on page 121.

The Annual Financial Statements of the Department set out on page 128 to page 207 have been approved.

_________________




110

REPORT OF THE ACCOUNTING OFFICERfor the year ended 31 March 2013

Report by the Accounting Officer to the Executive Authority and Provincial Legislature of the Northern Cape.

1. General review of the state of financial affairsIn striving to achieve our constitutional mandate with determination and commitment to ensure every South African has access to adequate housing, our programmes on human settlements were successfully imple-mented.

The department managed to achieve more than its planned targets under the Human Settlements Programme over the past financial year. The consumer education programme has been implemented successfully, from 500 planned to 900 actual achievements. These programmes assisted the beneficiaries to understand the value attached to their properties. Number of sites planned and surveyed under all programmes were 4176 planned with an achievement of 7847. Number of sites serviced under all programmes were 1382 planned with an achievement of 1553. Number of Houses planned were 2704, but department managed to build 2839 units by end of this financial year.

The process of building 491 units in Lerato Park were implemented successfully and as at end of March 2013, about 381 houses were nearly completed. This project will be completed by end of July 2013, and phase 2 will start during this financial year (2013/14).

The programmes under local government were fully implemented, but the monitoring of municipalities re-mains a challenge within the department.

However certain achievements can be mentioned as follows;

13 Municipalities identified for fast-tracking the implementation of Local Government Turn-Around Strategy (LGTAS)

The Municipal Infrastructure Support Agent (MISA) established and four highly qualified technical experts deployed to the Northern Cape to assist with the enhancement of both management and technical capacity of municipalities in terms of infrastructure related projects

Number of municipalities implementing Community Work Programme increased from 4 to 11 municipalities

Municipalities supported and monitored in terms of implementing their audit actions plans

The Provincial Spatial Development Framework was finalised in August 2012

Differentiated approach towards municipal finance, planning and support and support developed and imple-mented

New, simplified IDP Framework introduced and piloted in Renosterberg, Mier, Joe Morolong, Kgatelopele, Kamiesberg, Khai Ma and Siyathemba



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Reasons for Under/Over Spending

Programme 1: AdministrationExplanation of variance - The under expenditure is mainly due to the departmental cash flow challenges that led to the cost containment as a result of the unresolved loan from Provincial Treasury. Hence the budget on the goods and services could not be fully spent due the cut in spending on some operational activities such as telephones, excesses travelling, catering activities and accommodation.

Programme 2: Human SettlementsExplanation of variance - The under expenditure is mainly due to the departmental cash flow challenges that led to the cost containment as a result of the unresolved R26 million loan from Provincial Treasury. Hence the budget on capital payments, stationary and travelling was not fully spent.

Programme 3: Co-Operative GovernanceExplanation of variance - The under expenditure is mainly due to the departmental cash flow challenges that led to the cost containment as a result of the unresolved R26 million loan from Provincial Treasury. Hence the budget on compensation, transfers, capital payments, stationary and travelling was not fully spent. On the Transfer payments the budget could not be spend due to non-submission of business plans and reports by Municipalities.

The impact on service delivery has been a major challenge due to insufficient funding, however the human settlements conditional grants operations were not affected negatively. The department could still managed to spent the funds allocated for building houses and even exceeding the target set by 135 units.

Virement:A Virement from Administration: (R4,125,00) to Co-Operative Governance: R3,000,000 and Traditional Af-fairs: R1,125,000 as well as minor budget shifts done within main divisions.

Reason for the virementTo avoid Unauthorised expenditure the department applied for a Virement from Administration: (R4,125,00) to Co-Operative Governance: R3,000,000 and Traditional Affairs: R1,125,000 as well as minor budget shifts done within main divisions.

The only material matter is the Irregular expenditure of Human Settlements Grant amounting to R10,271 mil-lion in the current financial year due to SCM process not being followed at municipalities. The other Irregular of R27,366 million is due to departmental expenditure where Transfers were made to municipalities without Gazetting and SCM process of appointing contractors and agencies was not followed.



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Service rendered by the departmentA list of services rendered, is discussed in the annual report, per programme and sub – programme.

Tariff policyThe Department provides a property valuation service to the municipalities. This assist municipalities in determining property rates and represents major source of revenue income. A general valuation of all the properties in the municipal areas is done at regular intervals, and the new properties are valued in the interim until a new general valuation is done again.

Two rates are levied at present in terms of the ordinance applicable.

These ordinances of the Cape Province are Valuation Ordinance, 1944 (Ordinance 26 of 1944) and Valuation Ordinance, 1993 (Or-dinance, 148 of 1993) that came into effect on 1 July 1994. The rate for the old ordinance is R 280 per day and R 420 per day for the new ordinance, respectively.

All towns whose General Valuation was done prior to the coming into effect of the new ordinance, are charged R 280 per day for their interim valuations. In terms of the 1944 ordinance a General Valuation is to be conducted at least every 8 to 10 years. This means that some towns may be charged at this lower rate until one is done in terms of the 1993 Ordinance supersedes their current roll. All towns whose General Valuation was done on the new ordinance are charged R 420 per day. These tariffs may be reviewed with the implementation of the new Property Rates Act.

Free ServicesThe Department provides the following free services:

• Valuation services to other Government Departments;

• Legal advice to municipalities

• Town Planning advice to municipalities; and

• GIS services to Government Departments and municipalities.

To reflect its community responsibility the department allowed a small vendor to operate a vending machine on the departmental premises at no cost.

For its asset disposal processes approved by the Accounting Officer the department donated the assets to Non-profit community organisations instead of selling those assets.



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InventoriesThe total inventories on hand at year-end are included in Annexure6 as per financial statements.

Capacity constraintsMost of the vacant funded replacements posts were filled especially at regional offices and at senior manage-ment level. Due to budget constraints the department experienced over this year only posts which became vacant during the 2012/13 financial year could be filled.

Utilisation of donor fundsNone.

Trading entities and public entitiesNot applicable to this Department.

Organisations to whom transfer payments have been made (Refer to Annexure 1 to the Annual Financial Statements)

Public private partnerships (PPP)The Department has not entered into any public private partnership in this financial year.

Corporate governance arrangementsThe Accounting Officer is responsible for budgetary control, by ensuring that expenditure is in accordance with the vote of the Department and the main division within the vote. This is in accordance with Section 39(1) (2) of the Public Finance Management Act.

Financial Delegations have been developed and distributed to both the Programme and Responsibilities Man-agers to assist the Accounting Officer of the Department in discharging his duties.

The Accounting Officer is responsible to ensure that the Department has and maintains effective, efficient and transparent systems of financial and risk management and internal control, and that a system of internal audit under the control and direction of an audit committee complying with and operating in accordance with regulations and instructions prescribed in terms of section 76 and 77 as stated on Section 38 (1)(i) of Public Finance Management Act.



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Discontinued activities/activities to be discontinuedNone.

New/proposed activitiesStrategic Planning and Monitoring Unit need to be established. This measure is aimed at improving the re-porting on performance information and also ensuring the verification of portfolio of evidence based on the performance reported.

Asset management All departmental Assets are on the manual asset register and the process of capturing on Logis is under way. The department had only two officials dedicated for asset management at the head office. The department is in the process filling all the vacant positions in the asset management unit to fast track the capturing of assets on Logis.

InventoriesInventories as captured under Annexure 6 relates to Housing Projects.

Events after the reporting dateA submission for the condonement of unauthorised expenditure of the previous year amounting to R26 million was submitted to Provincial Treasury for consideration by the Provincial Legislature. The department is confident that the condonement will be granted because the condonement is with funding. The resultant impact on the department’s books of accounts will be that the Unauthorised of R48 million will reduce with the same amount condoned.

Accrual: These amounts do not include invoices received for Human Settlements projects - work that was done in advance for the 2013/2014 budget ongoing projects. Therefore these amounts do not form part of the Accruals because the 2012/2013 Human settlements grant was fully spend and the targets achieved.

Information on predetermined objectivesThe Department’s strategic direction is outlined in its Strategic and Performance Plan. It has adopted the strategic management framework to assist in designing, implementing, co-ordinating and monitoring the ef-ficiency and effectiveness of its operations. The annual performance plans outline the measurable objectives, performance measures and targets through which the Department achieves its planned output.

Quarterly performance reports were submitted to the Accounting Officer and Executive Authority for reporting on both financial and non-financial data, using the standardised format as determined by National Treasury. This enabled management to make strategic decisions in time to ensure the effective delivery of services by better planning.



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2. Effective and appropriate steps must be taken against any official who is found to have transgressed supply management policies.

Procurement and contract man-agement1. Goods and services with a transaction value below R500 000 were procured without obtaining the required price quotations, as required by Treasury Reg-ulation 16A6.1.

2. Sufficient appropriate audit evidence could not be obtained in some instances that invitations for competitive bidding had been advertised for the required minimum period of 21 days, as required by Treasury Regulation 16A6.3(c).

3. Sufficient appropriate audit evidence could not be obtained that all housing project contracts had been awarded in accordance with the legislative require-ments as sufficient tender documen-tation could not be provided for audit purposes, as required by section 41 of the PFMA.

4. The preference point system was not applied in all procurement of goods and services above R30 000 as required by section 2(a) of the Preferential Procure-ment Policy Framework Act and Trea-sury Regulations 16A6.3(b).

5. IT related goods and services, clas-sified as mandatory, were not procured through SITA as required by section 7(3) of the SITA Act.

1. All payments are pre-audited before payments are done to ensure that all relevant documentation is attached and signatures for approval are included.

2. As a follow-up the Internal Inspec-torate will do an audit to identify those payments done without complying with the requirements of SCM.

3. Internal investigations are conducted to determine where the transgression occurred.

4. The bulk of the irregular expenditure incurred as reported on the financial statements relates to procurement pro-cesses at municipal level, based on the housing projects implemented.

5. It is based on legacy projects that date back to 2004/05 financial since the in-ception of MFMA.

Reference to previous audit report and SCOPA

resolutions

Subject Findings on progress



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3. The Accounting Officer must ensure that targets set are achieved.

6. Performance management activities were not properly captured by officials and records were not adequately main-tained. Management did not adequately review the annual performance report.

Human Settlements:

• The department managed to achieve more than its planned targets under the Human Settlements Programme over the past financial year.

• The consumer education pro-gramme has been implemented successfully, from 500 planned to 900 actual achievements.

• These programmes assisted the beneficiaries to understand the val-ue attached to their properties.

• Number of sites planned and sur-veyed under all programmes were 4176 planned with an achievement of 7847.

• Number of sites serviced under all programmes were 1382 planned with an achievement of 1553.

• Number of Houses planned were 2704, but department managed to build 2839 units by end of this fi-nancial year.

Co-operative Governance:• Some targets set for Programme 3

are unrealistic and this must be re-viewed.

• Targets set must speak to the Annu-al Performance Plan as informed by the Outcome 9 Delivery Agreement which has been signed between the MEC and the Minister of COGTA.

• In future, the Department will avoid a situation where it reports on things that are not in the APP.

The department established a strategic planning monitoring and evaluation unit to assist with the coordination of target setting, reporting against set target to ensure improvement.



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4. Internal control systems must be strengthened and monitored to detect and prevent irregular expenditure.

7. I considered internal control relevant to my audit of the fi-nancial statements, annual per-formance report and compliance with laws and regulations. The matters reported below under the fundamentals of internal control are limited to the significant defi-ciencies that resulted in the find-ings on the annual performance report and the findings on com-pliance with laws and regulations included in this report.

Leadership

8. The department did have a municipal finance unit to exer-cise oversight over all municipal financial and compliance matters, including supply chain manage-ment. However, management did not perform adequate oversight and proper reporting on munici-palities.

Financial and performance man-agement9. Material adjustments in the financial statements resulted from various offi-cials compiling smaller sections of the financial statements without application of the Departmental financial reporting framework and the lack of management review of the financial statements.

10. Compliance with applicable laws and regulations were not reviewed and monitored by relevant officials in certain instances as reported in the compliance paragraphs above.

11. Performance management activities were not properly captured

The material Irregular Expenditure amount is related to SCM process that happened/did not happen at the munic-ipality level and this the department is addressing as follows:

• An Action Plan has been developed with targets set to address findings raised by the Auditor-General.

• A circular was drafted and forward-ed to the Municipalities requesting the SCM documentation on suppli-ers appointed for Projects.

• A checklist was implemented by the unit when compiling payments for processing

• An action plan was developed stipulating the following: Engage Municipalities and ensure that for new projects SCM process are fol-lowed before funds are transferred to them.

• All supporting documents are safely secured.

• The department is in the process of establishing a committee that will investigate the Irregular Expendi-ture of the department and advice the Accounting Officer.

• As a follow-up the Internal Inspec-torate will do an audit to identify those payments done without com-plying with the requirements of SCM.



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by officials and records were not ade-quately maintained. Management did not adequately review the annual perfor-mance report..

Governance12. The audit committee did not func-tion throughout the year. Members were only appointed in December 2011 three months before year-end. Consequently, the committee could not fulfil all of its roles and responsibilities for the year under review.13. An internal audit function was not established during the year which can be attributed to vacancies with the function.

5. Performance information must be accurate and reliable before submitting the report.

14. Performance management activ-ities were not properly captured by officials and records were not adequately maintained. Manage-ment did not adequately review the annual performance report.

• The department established a stra-tegic planning monitoring and evaluation unit to assist with the coordination of target setting, re-porting against set target to ensure improvement.

17. Prior modifications to Audit ReportsIrregular Expenditure:The department is in the process of strengthening the Supply Chain Management unit and will utilise the Internal Inspectorate Unit more effectively as an internal control measure.

The completeness of the Irregular expenditure was dependant on information availed by municipalities for Housing projects.

The discussion should be limited to all matters that gave rise to a qualification, disclaimer, adverse opinion and matters of non-compliance only. The department may include the information in a table as follows:



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18. Exemptions and deviations received from the National TreasuryThe Department did not apply for any exemption or deviations, as stipulated in the PFMA or Treasury Regu-lations based on financial reporting during the financial year under review.

19. Interim Financial StatementsThe department submitted all the four 2012/13 Interim Financial Statements and this has assisted the depart-ment with the compilation of the AFS.

20. OtherThe AFS for 2010/11 had to be re-submitted during the 2012/13 financial year. This had an impact on the audited comparison figures for the 2011/12 financial year especially on the Cash Flow Statement.

The Department transfer conditional grants to municipalities for housing projects because they are the im-plementing agent of the Department. Irregular expenditure amounting to R430m, arose because of the SCM procedures that were not followed at the municipalities when appointing contractors on the housing projects. The Accounting Officer obtained assurance from the Municipalities by means of the contract signed by both parties that contractors will be appointed through the Supply Chain Policy of the Municipality. The proper procedures were followed as per PFMA requirements when funds were transferred to the Municipalities. This matter from the Department side is viewed as non-compliance with regard to section of the PFMA rather than an irregularity. In future the appointment of the contractors will be handled by the Department as a preventa-tive measure.

21. ApprovalThe Annual Financial Statements set out on pages 128 to 206 have been approved by the Accounting Of-ficer(s).

_________________




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AG REPORT(As per the actual transcript of the audit report issued by the Auditor-General of South Africa)



121

REPORT OF THE AUDITOR-GENERAL TO THE NORTHERN CAPE PROVINCIAL LEGISLATURE ON VOTE NO. 9: DEPARTMENT OF CO-OPERATIVE GOVERNANCE, HUMAN SETTLEMENTS AND TRADITIONAL AFFAIRS

REPORT ON THE FINANCIAL STATEMENTS

Introduction1. I have audited the financial statements of the Department of Co-operative Governance Human Settlement and Traditional Affairs set out on pages 128 to 195, which comprise the appropriation statement, the state-ment of financial position as at 31 March 2013, the statement of financial performance, statement of changes in net assets and the cash flow statement for the year then ended, and the notes, comprising a summary of significant accounting policies and other explanatory information.

Accounting officer’s responsibility for the financial statements2. The accounting officer is responsible for the preparation of these financial statements in accordance with The Departmental financial reporting framework prescribed by the National Treasury and the requirements of the Public Finance Management Act of South Africa, 1999 (Act No. 1 of 1999) (PFMA) and Division of Rev-enue Act of South Africa, 2012 (Act No. 5 of 2012) (DoRA), and for such internal control as the accounting officer determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor-General’s responsibility3. My responsibility is to express an opinion on these financial statements based on my audit. I conducted my audit in accordance with the Public Audit Act of South Africa, 2004 (Act No. 25 of 2004) (PAA), the General Notice issued in terms thereof and International Standards on Auditing. Those standards require that I com-ply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

4. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation of the finan-cial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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



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Opinion6. In my opinion, the financial statements present fairly, in all material respects, the financial position of the Department of Co-operative Governance Human Settlement and Traditional Affairs as at 31 March 2013, and its financial performance and cash flows for the year then ended in accordance with the Departmental finan-cial reporting framework prescribed by the National Treasury and the requirements of the PFMA and DoRA.

Emphasis of matters7. I draw attention to the matters below. My opinion is not modified in respect of these matters.

Irregular expenditure8. The full extent of the irregularities as disclosed in note 25 is still in the process of being determined. This related to:

• Non-compliance with Supply Chain Management Regulations at municipal level on housing transfer payments amounting to R79 262 000 for the current year and R392 452 000 for prior years as disclosed in note 25.6 to the financial statements.

• Non-compliance with supply chain management processes as the required number of quotations was not obtained in some instances amounting to R27 627 000 for the current year as disclosed in note 25.6 to the financial statements.

Material under spending of the budget 9. As disclosed in the appropriation statement, the department has materially under spent the budget on Goods and Services and Machinery and Equipment to the amount of R12 570 000. The under spending is part of the process to decrease the bank overdraft of R31 574 000.

Additional matters10. I draw attention to the matters below. My opinion is not modified in respect of these matters.

Financial reporting framework

11. The financial reporting framework prescribed by the National Treasury and applied by the department is a compliance framework. The wording of my opinion on a compliance framework should reflect that the financial statements have been prepared in accordance with this framework and not that they “present fairly”. Section 20(2)(a) of the PAA, however, requires me to express an opinion on the fair presentation of the finan-cial statements. The wording of my opinion therefore reflects this requirement.

Unaudited supplementary schedules

12. The supplementary information set out on pages 196 to 206 does not form part of the financial state-ments and is presented as additional information. I have not audited these schedules and, accordingly, I do not express an opinion thereon.



123

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS13. In accordance with the PAA and the General Notice issued in terms thereof, I report the following findings relevant to performance against predetermined objectives, compliance with laws and regulations and internal control, but not for the purpose of expressing an opinion.

Predetermined objectives14. I performed procedures to obtain evidence about the usefulness and reliability of the information in the annual performance report as set out on pages 20 to 66 of the annual report.

15. The reported performance against predetermined objectives was evaluated against the overall criteria of usefulness and reliability. The usefulness of information in the annual performance report relates to whether it is presented in accordance with the National Treasury’s annual reporting principles and whether the re-ported performance is consistent with the planned objectives. The usefulness of information further relates to whether indicators and targets are measurable (i.e. well defined, verifiable, specific, measurable and time bound) and relevant as required by the National Treasury Framework for managing programme performance information (FMPPI).

The reliability of the information in respect of the selected programmes is assessed to determine whether it adequately reflects the facts (i.e. whether it is valid, accurate and complete).

16. The material findings are as follows:

Usefulness of information17. A total of 26% of the targets not achieved, had no explanations of the reasons for variances between planned and actual achievements reported in the annual performance report, as required by National Treasury annual report preparation guide. This was due to lack of review of the presentation of the annual performance report by management.

18. Section 40 (3) (a) of PFMA requires that the actual achievements against all planned indicators and tar-gets must be reported annually. The annual performance report submitted for audit purposes did not include the actual performance of 24% of all planned objectives, 22% indicators, 34% targets specified in the annual performance for the year under review. This was due to the lack of review of the completeness of reporting documents by management.

Reliability of informationReported performance not reliable 19. The National Treasury Framework for managing programme performance information (FMPPI) requires that institutions should have appropriate systems to collect, collate, verify and store performance information to ensure valid, accurate and complete reporting of actual achievements against planned objectives, indica-tors and targets.



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20. The reported performance information as a whole of Human Settlements and Co-operative Governance are materially misstated due to the cumulative effect of numerous individually immaterial uncorrected mis-statements in the targets relevant to the selected programme. This was due to the lack of standard operating procedures for the accurate recording of actual achievements.

Additional matters21. I draw attention to the following matters below. These matters do not have an impact on the predeter-mined objectives audit findings reported above.

Achievement of planned targets22. Of the total of 146 targets planned for the year, 67 were not achieved during the year under review. This represents 46% of total planned targets.

This was as a result of the institution not considering relevant systems and evidential requirements during the annual strategic planning process.

Material adjustments to the annual performance report23. Material audit adjustments in the annual performance report were identified during the audit, of which some were corrected by management and those that were not corrected are included in the basis for qualified conclusion paragraphs

Compliance with laws and regulations24. I performed procedures to obtain evidence that the entity has complied with applicable laws and regula-tions regarding financial matters, financial management and other related matters. My findings on material non-compliance with specific matters in key applicable laws and regulations as set out in the General Notice issued in terms of the PAA are as follows:

Annual financial statements, performance and annual report25. The financial statements submitted for auditing were not prepared in accordance with the prescribed fi-nancial reporting framework and supported by full and proper records as required by section 40(1) (a) and (b) of the Public Finance Management Act. Material misstatements of disclosure items identified by the auditors in the submitted financial statement were subsequently corrected and the supporting records were provided subsequently, resulting in the financial statements receiving an unqualified audit opinion.

Procurement and contract management26. Invitations for competitive bidding were not always advertised in at least the government tender bulletin, as required by Treasury Regulation 16A6.3(c).

27. Contracts were extended or modified without the approval of a properly delegated official as required by Treasury Regulation 8.1 and 8.2 and Public Finance Management Act section 44.



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Human resources management28. A written policy on overtime was not in place as required by Public Service Regulation (PSR) 1/V/D2 (b).

29. Employees were compensated for overtime work which was not approved in advance as required by Pub-lic Service Regulation 1/V/D.2(c).

30. Funded vacant posts were not filled within 12 months as required by Public Service Regulation 1/VII/C.1A.2.

31. Persons in charge at pay points did not always certify that the employees receiving payment were entitled thereto as required by Treasury Regulation 8.3.4.

Expenditure management32. The accounting officer did not take effective steps to prevent irregular and fruitless and wasteful expendi-ture, as required by section 38(1)(c)(ii) of the Public Finance Management Act and Treasury Regulation 9.1.1.

33. Effective and appropriate disciplinary steps were not taken against officials who made and permitted un-authorised expenditure, irregular expenditure and fruitless and wasteful expenditure, as required by section 38(1)(h)(iii) of the Public Finance Management Act and Treasury Regulation 9.1.3.

34. Contractual obligations and money owed by the department were not settled within 30 days or an agreed period, as required by section 38(1)(f) of the Public Finance Management Act and Treasury Regulation 8.2.3.

Transfer of funds35. The accounting officer transferred funds to entities without obtaining written assurance that the entity im-plements effective, efficient and transparent financial management and internal control systems, as required by section 38(1)(j) of the Public Finance Management Act.

Monitoring of municipalities36. The department did not fulfil its oversight role over municipalities as required by section 136 of the Mu-nicipal Finance Management Act, 2003 (Act no. 56 of 2003) (MFMA). The department did not have sufficient resources and skills to provide adequate support to municipalities. The department did not have an action plan to address shortcomings in financial and performance management at municipalities.

Internal control37. I considered internal control relevant to my audit of the financial statements, annual performance report and compliance with laws and regulations. The matters reported below under the fundamentals of internal control are limited to the significant deficiencies that resulted in the findings on the annual performance re-port and the findings on compliance with laws and regulations included in this report.



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Leadership38. The leadership of the department did not exercise oversight responsibility to ensure that proper internal control procedures are developed and implemented that will enable the department to produce accurate and complete annual financial statements.

39. The leadership does not exercise oversight responsibility on performance reporting and compliance with laws and regulations and internal control.

40. Oversight responsibilities assigned by the MFMA to the department and its leadership regarding financial and performance reporting, and compliance and related internal controls on municipal level including over-sight on the local government turnaround strategy did not produce the required impact on the municipal audit outcomes.

41. Leadership did not communicate and enforce management assertions (completeness, accuracy, quality) related to the disclosures in the financial statements and performance reports of the department.

Financial and performance management42. The department did not implement proper record keeping in a timely manner to ensure that complete, relevant and accurate information is accessible and available to support financial and performance reporting. This resulted in material adjustments in the financial statements and the auditors being unable to obtain all information needed to audit performance management.

43. Reviewing and monitoring compliance with applicable laws and regulations are not done by the depart-ment. The department does not have a delegated employee that is trained with the necessary technical skills to address and monitor new legislative changes affecting the department.

Kimberley

31 July 2013



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ANNUAL FINANCIAL STATEMENTS



128

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129

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139

Detail of transfers and subsidies as per Appropriation Act (after Virement):Detail of these transactions can be viewed in the note on Transfers and subsidies, disclosure notes and An-nexure 1 (A-H) to the Annual Financial Statements.

Detail of specifically and exclusively appropriated amounts voted (after Virement):Detail of these transactions can be viewed in note 1 (Annual Appropriation) to the Annual Financial State-ments.

Detail on payments for financial assets

Detail of these transactions per programme can be viewed in the note on Payments for financial assets to the Annual Financial Statements.

Explanations of material variances from Amounts Voted (after Virement):

4.1 Per programme Final Appropriation Actual Expenditure Variance R’000 Variance as a % of Final Appro-priation

Programme 1: Administration 97,032 89,411 7,621 92%

Programme 2: Human Settlements 374,820 373,676 1,144 100%

Programme 3: Co-Operative Governance

107,321 103,516 3,805 97%

Etc.

4.2. Per economic Classification

Final Appropriation

Actual Expenditure

Variance Variance as a % of Final Appropriation

R’000 R’000 R’000 R’000

Current payments

Compensation of employees 181,152 180,226 926 99.5%

Goods and services 59,907 53,413 6,494 89.2%

Interest and rent on land

Unauthorised expenditure approved

R’000 R’000 R’000 R’000

NOTES TO THE APPROPRIATION STATEMENTfor the year ended 31 March 2013



140

Transfers and subsidies

Provinces and municipalities 6,864 5,003 1,861 72.9%

4.2. Per economic Classification

Final Appropriation

Actual Expenditure

Variance Variance as a % of Final Appropriation

R’000 R’000 R’000 R’000

Departmental agencies and accounts

Universities and technikons

Public corporations and private enter-prises

Foreign governments and international organisations

Non-profit institutions

Households

Gifts and donations

Payments for capital assets

Buildings and other fixed structures

Machinery and equipment 5,300 1,893 3,407 35.7%

Heritage assets

Specialised military assets

Biological assets

Land and subsoil assets

Software and other intangible assets

Payments for financial assets

NOTES TO THE APPROPRIATION STATEMENTfor the year ended 31 March 2013



141

PERFORMANCE Note 2012/13 2011/12

R’000 R’000

REVENUE

Annual appropriation 1 594,511 588,276

Departmental revenue 2 6 313

Aid assistance 3 - -

TOTAL REVENUE 594,517 588,589

EXPENDITURE

Current expenditure

Compensation of employees 4 180,226 165,965

Goods and services 5 53,369 57,572

Interest and rent on land 6 - 37

Aid assistance 3 - 126

Unauthorised expenditure approved without funding 9 - -

Total current expenditure 233,595 223,700


Transfers and subsidies 7 346,409 363,060

Aid assistance 3 - -


Total transfers and subsidies 346,409 363,060

Expenditure for capital assets

Tangible capital assets 8 1,937 2,907

Software and other intangible assets 8 - -


Total expenditure for capital assets 1,937 2,907

TOTAL EXPENDITURE 581,941 589,667

STATEMENT OF FINANCIAL PERFORMANCEfor the year ended 31 March 2013



142

SURPLUS/(DEFICIT) FOR THE YEAR 12,576 (1,078)

Reconciliation of Net Surplus/(Deficit) for the year

Voted funds 12,570 (1,265)

Annual appropriation

Conditional grants

Unconditional grants

Departmental revenue and NRF Receipts 15 6 313

Aid assistance 3 - (126)

SURPLUS/(DEFICIT) FOR THE YEAR 12,576 (1,078)

STATEMENT OF FINANCIAL PERFORMANCEfor the year ended 31 March 2013



143

STATEMENT OF FINANCIAL POSITIONfor the year ended 31 March 2013

POSITION Note 2012/13 2011/12

R’000 R’000

ASSETS

Current assets 48,382 48,426

Unauthorised expenditure 9 48,084 48,084

Fruitless and wasteful expenditure 10 - -

Cash and cash equivalents 11 2 2

Other financial assets 16 - -

Prepayments and advances 12 6 7

Receivables 13 290 333

Loans 20 - -

Aid assistance prepayments 3 - -

Aid assistance receivable 3 - -

TOTAL ASSETS 48,382 48,426

LIABILITIES

Current liabilities 48,382 48,426

Voted funds to be surrendered to the Revenue Fund 14 12,555 10,483

Departmental revenue and NRF Receipts to be surrendered to the Revenue Fund

15 54 93

Bank overdraft 16 31,574 33,682

Payables 17 3,333 3,302

Aid assistance repayable 3 - -

Aid assistance unutilised 3 866 866

TOTAL LIABILITIES 48,382 48,426

NET ASSETS - -



144

CASH FLOW STATEMENTfor the year ended 31 March 2013

CASH FLOW Note 2012/13 2011/12

R’000 R’000

CASH FLOWS FROM OPERATING ACTIVITIES

Receipts 594,969 588,760

Annual appropriated funds received 1.1 594,511 588,276

Departmental revenue received 2 458 484

Aid assistance received 3 - -

Net (increase)/decrease in working capital 75 (4,650)

Surrendered to Revenue Fund (10,995) (747)

Surrendered to RDP Fund/Donor - -

Current payments (233,595) (219,066)

Payments for financial assets - -

Transfers and subsidies paid (346,409) (363,060)

Net cash flow available from operating activities 18 4,045 1,237

CASH FLOWS FROM INVESTING ACTIVITIES

Payments for capital assets 8 (1,937) (2,907)

Proceeds from sale of capital assets 2.3 - 260

(Increase)/decrease in loans - -

(Increase)/decrease in investments - -

(Increase)/decrease in other financial assets - -

Net cash flows from investing activities (1,937) (2,647)

CASH FLOWS FROM FINANCING ACTIVITIES

Distribution/dividend received - -

Increase/(decrease) in net assets - -

CASH FLOW Note 2012/13 2011/12

Increase/(decrease) in non-current payables - -

Net cash flows from financing activities - -

Net increase/(decrease) in cash and cash equivalents 2,108 (1,410)

Cash and cash equivalents at beginning of period (33,680) (32,270)

Cash and cash equivalents at end of period 19 (31,572) (33,680)



145

ACCOUNTING POLICIESfor the year ended 31 March 2013

The Financial Statements have been prepared in accordance with the following policies, which have been ap-plied consistently in all material aspects, unless otherwise indicated. However, where appropriate and mean-ingful, additional information has been disclosed to enhance the usefulness of the Financial Statements and to comply with the statutory requirements of the Public Finance Management Act, Act 1 of 1999 (as amended by Act 29 of 1999), and the Treasury Regulations issued in terms of the Act and the Division of Revenue Act, Act 1 of 2010.

1. Presentation of the Financial Statements

1.1. Basis of preparationThe financial statements have been prepared on a modified cash basis of accounting.

Under this basis, the effects of transactions and other events are recognised in the financial records when the resulting cash is received or paid. The “modification” results from the recognition of certain near-cash balanc-es in the financial statements as well as the revaluation of foreign investments and loans and the recognition of resulting revaluation gains and losses.

In addition supplementary information is provided in the disclosure notes to the financial statements where it is deemed to be useful to the users of the financial statements.

1.2. Presentation currencyAll amounts have been presented in the currency of the South African Rand (R) which is also the functional currency of the department.

1.3. RoundingUnless otherwise stated all financial figures have been rounded to the nearest one thousand Rand (R’000).

1.4. Comparative figuresPrior period comparative information has been presented in the current year’s financial statements. Where necessary figures included in the prior period financial statements have been reclassified to ensure that the format in which the information is presented is consistent with the format of the current year’s financial state-ments.



146


1.5. Comparative figures - Appropriation StatementA comparison between actual amounts and final appropriation per major classification of expenditure is included in the Appropriation Statement.

2. Revenue

2.1. Appropriated fundsAppropriated funds comprises of departmental allocations as well as direct charges against revenue fund (i.e. statutory appropriation).

Appropriated funds are recognised in the financial records on the date the appropriation becomes effective. Adjustments made in terms of the adjustments budget process are recognised in the financial records on the date the adjustments become effective.

Unexpended appropriated funds are surrendered to the National/Provincial Revenue Fund. Any amounts ow-ing to the National/Provincial Revenue Fund at the end of the financial year are recognised as payable in the statement of financial position.

Any amount due from the National/Provincial Revenue Fund at the end of the financial year is recognised as a receivable in the statement of financial position.

2.2. Departmental revenueAll departmental revenue is recognised in the statement of financial performance when received and is sub-sequently paid into the National/Provincial Revenue Fund, unless stated otherwise.

Any amount owing to the National/Provincial Revenue Fund at the end if the financial year is recognised as a payable in the statement of financial position.

No accrual is made for amounts receivable from the last receipt date to the end of the reporting period. These amounts are however disclosed in the disclosure notes to the annual financial statements.

2.3. Direct Exchequer receiptsAll direct exchequer receipts are recognised in the statement of financial performance when the cash is re-ceived and is subsequently paid into the National/Provincial Revenue Fund, unless stated otherwise.

Any amount owing to the National/Provincial Revenue Funds at the end of the financial year is recognised as a payable in the statement of financial position.



147


2.4. Direct Exchequer paymentsAll direct exchequer payments are recognised in the statement of financial performance when final authorisa-tion for payment is effected on the system (by no later than 31 March of each year).

2.5. Aid assistance

Aids assistance is recognised as revenue when received. All in-kind aid assistance is disclosed at fair value on the date of receipt in the annexure to the Annual Financial Statements

The cash payments made during the year relating to aid assistance projects are recognised as expenditure in the statement of financial performance when final authorisation for payments is effected on the system (by no later than 31 March of each year)

The value of the assistance expensed prior to the receipt of funds is recognised as a receivable in the state-ment of financial position.

Inappropriately expensed amounts using aid assistance and any unutilised amounts are recognised as paya-bles in the statement of financial position.

All CARA funds received must be recorded as revenue when funds are received. The cash payments made during the year relating to CARA earmarked projects are recognised as expenditure in the statement of finan-cial performance when final authorisation for payments effected on the system (by no later then 31 March of each year)

Inappropriately expensed amounts using CARA funds are recognised as payables in the statement of financial position. Any unutilised amounts are transferred to retained funds as they are not surrendered to the revenue fund.

3. Expenditure

3.1. Compensation of employees

3.1.1. Salaries and wages

Salaries and wages are expensed in the statement of financial performance when the final authorisation for payment is effected on the system (by no later than 31 March of each year).

Other employee benefits that give rise to a present legal or constructive obligation are disclosed

in the disclosure notes to the financial statements at its face value and are not recognised in the statement of financial performance or position.



148


Employee costs are capitalised to the cost of a capital project when an employee spends more than 50% of his/her time on the project. These payments form part of expenditure for capital assets in the statement of financial performance.

3.1.2. Social contributions

Employer contributions to post employment benefit plans in respect of current employees are expensed in the statement of financial performance when the final authorisation for payment is effected on the system (by no later than 31 March of each year).

No provision is made for retirement benefits in the financial statements of the department. Any potential liabilities are disclosed in the financial statements of the National Revenue Fund and not in the financial state-ments of the employer department.

Employer contributions made by the department for certain of its ex-employees (such as medical benefits) are classified as transfers to households in the statement of financial performance.

3.2. Goods and services

Payments made during the year for goods and/or services are recognised as an expense in the statement of financial performance when the final authorisation for payment is effected on the system (by no later than 31 March of each year).

The expense is classified as capital if the goods and/or services were acquired for a capital project or if the total purchase price exceeds the capitalisation threshold (currently R5, 000). All other expenditures are clas-sified as current.

Rental paid for the use of buildings or other fixed structures is classified as goods and services and not as rent on land.

3.3. Interest and rent on landInterest and rental payments are recognised as an expense in the statement of financial performance when the final authorisation for payment is effected on the system (by no later than 31 March of each year). This item excludes rental for the use of buildings or other fixed structures. If it is not possible to distinguish between payment for the use of land and the fixed structures on it, the whole amount should be recorded under goods and services.

3.4. Payments for financial assets

Debts are written off when identified as irrecoverable. Debts written-off are limited to the amount of savings and/or underspending of appropriated funds. The write off occurs at year-end or when funds are available. No provision is made for irrecoverable amounts but an estimate is included in the disclosure notes to the financial statements.



149


All other losses are recognised when authorisation has been granted for the recognition thereof.

3.5. Transfers and subsidiesTransfers and subsidies are recognised as an expense when the final authorisation for payment is effected on the system (by no later than 31 March of each year).

3.6. Unauthorised expenditureWhen confirmed unauthorised expenditure is recognised as an asset in the statement of financial position until such time as the expenditure is either approved by the relevant authority, recovered from the responsible person or written off as irrecoverable in the statement of financial performance.

Unauthorised expenditure approved with funding is derecognised from the statement of financial position when the unauthorised expenditure is approved and the related funds are received.

Where the amount is approved without funding it is recognised as expenditure in the statement of financial performance on the date stipulated in the Act.

3.7. Fruitless and wasteful expenditureFruitless and wasteful expenditure is recognised as expenditure in the statement of financial performance according to the nature of the payment and not as a separate line item on the face of the statement. If the expenditure is recoverable it is treated as an asset until it is recovered from the responsible person or written off as irrecoverable in the statement of financial performance.

3.8. Irregular expenditureIrregular expenditure is recognised as expenditure in the statement of financial performance. If the expend-iture is not condoned by the relevant authority it is treated as an asset until it is recovered or written off as irrecoverable.

4. Assets

4.1. Cash and cash equivalentsCash and cash equivalents are carried in the statement of financial position at cost.

Bank overdrafts are shown separately on the face of the statement of financial position.

For the purposes of the cash flow statement, cash and cash equivalents comprise cash on hand, deposits held, other short-term highly liquid investments and bank overdrafts.



150


4.2. Other financial assetsOther financial assets are carried in the statement of financial position at cost.

4.3. Prepayments and advances

Amounts prepaid or advanced are recognised in the statement of financial position when the payments are made and are derecognised as and when the goods/services are received or the funds are utilised.

Prepayments and advances outstanding at the end of the year are carried in the statement of financial position at cost.

4.4. Receivables

Receivables included in the statement of financial position arise from cash payments made that are recovera-ble from another party (including departmental employees) and are derecognised upon recovery or write-off.

Receivables outstanding at year-end are carried in the statement of financial position at cost plus any accrued interest. Amounts that are potentially irrecoverable are included in the disclosure notes.

4.5. InvestmentsCapitalised investments are shown at cost in the statement of financial position.

Investments are tested for an impairment loss whenever events or changes in circumstances indicate that the investment may be impaired. Any impairment loss is included in the disclosure notes.

4.6. LoansLoans are recognised in the statement of financial position when the cash is paid to the beneficiary. Loans that are outstanding at year-end are carried in the statement of financial position at cost plus accrued interest. Amounts that are potentially irrecoverable are included in the disclosure notes.

4.7. InventoryInventories that qualify for recognition must be initially reflected at cost. Where inventories are acquired at no cost, or for nominal consideration, their cost shall be their fair value at the date of acquisition.

All inventory items at year-end are reflected using the weighted average cost or FIFO cost formula.



151


4.8. Capital assets

4.8.1. Movable assets

Initial Recognition

A capital asset is recorded in the asset register on receipt of the item at cost. Cost of an asset is defined as the total cost of acquisition. Where the cost cannot be determined accurately, the movable capital asset is stated at fair value. Where fair value cannot be determined, the capital asset is included in the asset register at R1.

All assets acquired prior to 1 April 2002 are included in the register R1.

Subsequent recognition

Subsequent expenditure of a capital nature is recorded in the statement of financial performance as “expend-iture for capital assets” and is capitalised in the asset register of the department on completion of the project.

Repairs and maintenance is expensed as current “goods and services” in the statement of financial perfor-mance.

4.8.2. Immovable assetsInitial recognition

A capital asset is recorded on receipt of the item at cost. Cost of an asset is defined as the total cost of acqui-sition. Where the cost cannot be determined accurately, the immovable capital asset is stated at R1 unless the fair value for the asset has been reliably estimated.

Subsequent recognition

Work-in-progress of a capital nature is recorded in the statement of financial performance as “expenditure for capital assets”. On completion, the total cost of the project is included in the asset register of the department that is accountable for the asset.

Repairs and maintenance is expensed as current “goods and services” in the statement of financial perfor-mance.

4.8.3. Intangible assetsInitial recognition

An intangible asset is recorded in the asset register on receipt of the item at cost. Cost of an intangible asset is defined as the total cost of acquisition. Where the cost cannot be determined accurately, the intangible as-set is stated at fair value. Where fair value cannot be determined, the intangible asset is included in the asset register at R1.



152


All intangible assets acquired prior to 1 April 2002 can be included in the asset register at R1.*

Subsequent expenditure

Subsequent expenditure of a capital nature is recorded in the statement of financial performance as “expend-iture for capital asset” and is capitalised in the asset register of the department.

Maintenance is expensed as current “goods and services” in the statement of financial performance.

5. Liabilities

5.1. PayablesRecognised payables mainly comprise of amounts owing to other governmental entities. These payables are carried at cost in the statement of financial position.

5.2. Contingent liabilitiesContingent liabilities are included in the disclosure notes to the financial statements when it is possible that economic benefits will flow from the department, or when an outflow of economic benefits or service poten-tial is probable but cannot be measured reliably.

5.3. Contingent assetsContingent assets are included in the disclosure notes to the financial statements when it is probable that an inflow of economic benefits will flow to the entity.

5.4. CommitmentsCommitments are not recognised in the statement of financial position as a liability or as expenditure in the statement of financial performance but are included in the disclosure notes.

5.5. AccrualsAccruals are not recognised in the statement of financial position as a liability or as expenditure in the state-ment of financial performance but are included in the disclosure notes.



153


5.6. Employee benefitsShort-term employee benefits that give rise to a present legal or constructive obligation are disclosed in the disclosure notes to the financial statements. These amounts are not recognised in the statement of financial performance or the statement of financial position.

5.7. Lease commitmentsFinance lease

Finance leases are not recognised as assets and liabilities in the statement of financial position. Finance lease payments are recognised as a capital expense in the statement of financial performance and are not apportioned between the capital and the interest portions. The total finance lease payment is disclosed in the disclosure notes to the financial statements.

Operating lease

Operating lease payments are recognised as an expense in the statement of financial performance. The op-erating lease commitments are disclosed in the discloser notes to the financial statement.

5.8. ImpairmentThe department tests for impairment where there is an indication that a receivable, loan or investment may be impaired. An assessment of whether there is an indication of possible impairment is done at each reporting date. An estimate is made for doubtful loans and receivables based on a review of all outstanding amounts at year-end. Impairments on investments are calculated as being the difference between the carrying amount and the present value of the expected future cash flows / service potential flowing from the instrument.

5.9. ProvisionsProvisions are disclosed when there is a present legal or constructive obligation to forfeit economic benefits as a result of events in the past and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate of the obligation can be made.

6. Receivables for departmental revenueReceivables for departmental revenue are disclosed in the disclosure notes to the annual financial statements. These receivables are written off when identified as irrecoverable and are disclosed separately.



154


7. Net Assets

7.1. Capitalisation reserveThe capitalisation reserve comprises of financial assets and/or liabilities originating in a prior reporting pe-riod but which are recognised in the statement of financial position for the first time in the current reporting period. Amounts are recognised in the capitalisation reserves when identified in the current period and are transferred to the National/Provincial Revenue Fund when the underlying asset is disposed and the related funds are received.

7.2. Recoverable revenueAmounts are recognised as recoverable revenue when a payment made in a previous financial year becomes recoverable from a debtor in the current financial year. Amounts are either transferred to the National/Provincial Revenue Fund when recovered or are transferred to the statement of financial performance when written-off.

8. Related party transactionsSpecific information with regards to related party transactions is included in the disclosure notes.

9. Key management personnelCompensation paid to key management personnel including their family members where relevant, is included in the disclosure notes.

10. Public private partnershipsA description of the PPP arrangement, the contract fees and current and capital expenditure relating to the PPP arrangement is included in the disclosure notes.



155

NOTES TO THE ANNUAL FINANCIAL STATEMENTSfor the year ended 31 March 2013

1. Annual Appropriation

1.1. Annual AppropriationIncluded are funds appropriated in terms of the Appropriation Act (and the Adjustments Appropriation Act) for National Depart-ments (Voted funds) and Provincial Departments:

2012/13 2011/12

Final Appropriation

Actual Funds Received

Funds not requested/

not received

Appropriationreceived

R’000 R’000 R’000 R’000

Programme 1 97,032 101,157 (4,125) 70,791

Programme 2 374,820 374,820 - 371,460

Programme 3 107,321 104,321 3,000 133,073

Programme 4 15,338 14,213 1,125 12,952

Total 594,511 594,511 - 588,276

Provide an explanation for funds not requested/not received

1.2. Conditional grants

Note 2012/13 2011/12

R’000 R’000

Total grants received 47 339,551 332,989

Provincial grants included in Total Grants received 4,935 30,288

2. Departmental revenue Note 2012/13 2011/12

R’000 R’000

Tax revenue - -

Sales of goods and services other than capital assets

2.1 403 372

Fines, penalties and forfeits 2.2 - -

Interest, dividends and rent on land 2.3 1 11

Sales of capital assets 2.4 - 260



156


Transactions in financial assets and liabilities 2.5 54 101

Transfer received 2.6 - -

Total revenue collected 458 744

Less: Own revenue included in appropriation 15 452 431

Departmental revenue collected 6 313

2.1. Sales of goods and services other than capital assets

Note 2012/13 2011/12

2 R’000 R’000

Sales of goods and services produced by the department

403 372

Sales by market establishment 403 356

Administrative fees - -

Other sales - 16

Sales of scrap, waste and other used current goods

- -

Total 403 372

2.2. Interest, dividends and rent on land

Note 2012/13 2011/12

2 R’000 R’000

Interest - -

Dividends - -

Rent on land 1 11

Total 1 11



157


2.3. Sale of Capital Assets

Note 2012/13 2011/12

2 R’000 R’000

Tangible assets - 260

Buildings and other fixed structures - -

Machinery and equipment - 260

Specialised military assets - -

Land and subsoil assets - -

Biological assets - -

Software and other intangible assets - -

Computer software - -

Total - 260

2.4. Transactions in financial assets and liabilities

Note 2012/13 2011/12

2 R’000 R’000

Loans and advances - -

Receivables - -

Forex gain - -

Stale cheques written back - -

Other Receipts including Recoverable Revenue 54 101

Total 54 101



158


3. Aid assistance

3.1. Aid assistance received in cash from other sources

2012/13 2011/12

R’000 R’000

Local

Opening Balance 866 992

Revenue - -

Expenditure - (126)

Current - (126)

Capital - -

Transfers - -

Prepayments - -

Surrendered to the donor - -

Closing Balance 866 866

3.2. Total assistance

2012/13 2011/12

R’000 R’000

Opening Balance 866 992

Revenue - -

Expenditure - (126)

Current - (126)

Capital - -

Transfers - -

Prepayments - -

Surrendered / Transferred to retained funds - -

Closing Balance 866 866



159


3.3. Analysis of balance

2012/13 2011/12

Note R’000 R’000

Aid assistance unutilised 866 866

RDP - -

Other sources 866 866

Aid assistance repayable - -

Closing balance 866 866

4. Compensation of employees

4.1. Salaries and Wages

Note 2012/13 2011/12

R’000 R’000

Basic salary 122,549 112,746

Performance award 2,575 2,548

Service Based 28,629 26,068

Compensative/circumstantial - -

Periodic payments 344 349

Other non-pensionable allowances - -

Total 154,097 141,711



160


4.2. Social contributions

Note 2012/13 2011/12

R’000 R’000

Employer contributions

Pension 16,017 14,577

Medical 10,077 9,642

UIF - -

Bargaining council 35 35

Official unions and associations - -

Insurance - -

Total 26,129 24,254

Total compensation of employees 180,226 165,965

Average number of employees 760 782



161


5. Goods and services Note 2012/13 2011/12

R’000 R’000

Administrative fees 210 469

Advertising 448 1,293

Assets less then R5,000 5.1 149 386

Bursaries (employees) 422 352

Catering 444 693

Communication 1,631 2,537

Computer services 5.2 2,308 2,194

Consultants, contractors and agency/outsourced services 5.3 11,031 8,520

Entertainment 164 251

Audit cost – external 5.4 4,717 3,978

Inventory 5.5 3,102 1,987

Operating leases 8,359 6,640

Property payments 5.6 8,532 10,614

Transport provided as part of the departmental activities 10 18

Travel and subsistence 5.7 9,920 15,205

Venues and facilities 325 174

Training and staff development 788 1,547

Other operating expenditure 5.8 809 714

Total 53,369 57,572

5.1. Assets less than R5,000

Note 2012/13 2011/12

5 R’000 R’000

Tangible assets 149 386

Buildings and other fixed structures - -

Biological assets - -

Heritage assets - -

Machinery and equipment 149 386



162


Note 2012/13 2011/12

5 R’000 R’000

Transport assets - -

Specialised military assets - -

Intangible assets - -

Total 149 386

5.2. Computer services

Note 2012/13 2011/12

5 R’000 R’000

SITA computer services

External computer service providers 2,308 2,194

- -

Total 2,308 2,194

5.3. Consultants, contractors and agency/outsourced servicesNote 2012/13 2011/12

5 R’000 R’000

Business and advisory services

Infrastructure and planning - -

Laboratory services 113 346

Legal costs - -

Contractors 278 214

Agency and support/outsourced services 1,121 518

9,519 7,442

Total 11,031 8,520



163


5.4. Audit Cost – External Note 2012/13 2011/12

5 R’000 R’000

Regularity audits 4,717 3,978

Performance audits - -

Investigations - -

Environmental audits - -

Computer audits - -

Total 4,717 3,978

5.5. InventoryNote 2012/13 2011/12

5 R’000 R’000

Learning and teaching support material - -

Food and food supplies 47 57

Fuel, oil and gas 1,156 717

Other consumables 67 63

Materials and supplies 92 8

Stationery and printing 1,740 1,142

Total 3,102 1,987

5.6. Property payments

Note 2012/13 2011/12

5 R’000 R’000

Municipal services - 1,197

Property management fees - -

Property maintenance and repairs - -

Other 8,532 9,417

Total 8,532 10,614



164


5.7. Travel and subsistence

Note 2012/13 2011/12

5 R’000 R’000

Local 9,822 15,077

Foreign 98 128

Total 9,920 15,205

5.8. Other operating expenditure

Note 2012/13 2011/12

5 R’000 R’000

Learnerships 111 303

Professional bodies, membership and subscription fees - 4

Resettlement costs 73 62

Gifts 39 -

Other 586 345

Total 809 714

6. Interest and rent on land Note 2012/13 2011/12

R’000 R’000

Interest paid - 37

Rent on land - -

Total - 37



165


7. Transfers and subsidies

2012/13 2011/12

R’000 R’000

Note

Provinces and municipalities 47, 48, Annex 1A, Annex 1B

5,006 27,200

Departmental agencies and accounts Annex 1C 500 500

Universities and technikons Annex 1D - -

Foreign governments and international organisa-tions

Annex 1F - -

Public corporations and private enterprises Annex 1E - -

Non-profit institutions Annex 1G -

Households Annex 1H 340,903 335,270

Gifts, donations and sponsorships made Annex 1K 90

Total 346,409 363,060

8. Expenditure for capital assets

Note 2012/13 2011/12

R’000 R’000

Tangible assets 1,937 2,907

Buildings and other fixed structures 32 14 -

Machinery and equipment 30 1,923 2,907

Software and other intangible assets - -

Computer software - -

- -

Total 1,937 2,907



166


8.1. Analysis of funds utilised to acquire capital assets – 2012/13

Voted funds Aid assistance Total

R’000 R’000 R’000

Tangible assets 1,937 - 1,937

Buildings and other fixed structures 14 - 14

Heritage assets - - -

Machinery and equipment 1,923 - 1,923

Specialised military assets - - -

Land and subsoil assets - - -

Biological assets - - -

Software and other intangible assets - - -

Computer software - - -

Mastheads and publishing titles - - -

Patents, licences, copyright, brand names, trademarks - - -

Recipes, formulae, prototypes, designs, models - - -

Services and operating rights - - -

Total 1,937 - 1,937

8.2. Analysis of funds utilised to acquire capital assets – 2011/12

Voted funds Aid assis-tance

Total

R’000 R’000 R’000

Tangible assets 2,907 - 2,907

Buildings and other fixed structures - - -

Heritage assets - - -

Machinery and equipment 2,907 - 2,907

Specialised military assets - - -

Land and subsoil assets - - -

Biological assets - - -



167


Voted funds Aid assis-tance

Total

R’000 R’000 R’000

Software and other intangible assets - - -

Computer software - - -

Mastheads and publishing titles - - -

Patents, licences, copyright, brand names, trade-marks

- - -

Recipes, formulae, prototypes, designs, models - - -

Services and operating rights - - -

Total 2,907 - 2,907



168


9. Unauthorised expenditure

9.1. Reconciliation of unauthorised expenditure

Note 2012/13 2011/12

R’000 R’000

Opening balance 48,084 43,559

Unauthorised expenditure – discovered in current year 9 - 4,525

Less: Amounts approved by Parliament/Legislature with funding - -

Less: Amounts approved by Parliament/Legislature without funding and written off in the Statement of Financial Perfor-mance

- -

Capital - -

Current - -

Transfers and subsidies - -

Less: Amounts transferred to receivables for recovery - -

Unauthorised expenditure awaiting authorisation / written off 48,084 48,084

Analysis of awaiting authorisation per economic classification

Capital

Current


Total

9.2. Analysis of unauthorised expenditure awaiting authorisation per economic classification

2012/13 2011/12

R’000 R’000

Capital 46,550 46,550

Current - -

Transfers and subsidies 1,534 1,534

Total 48,084 48,084



169


9.3. Analysis of unauthorised expenditure awaiting authorisation per type

2012/13 2011/12

R’000 R’000

Unauthorised expenditure relating to overspending of the vote or a main division within a vote

48,084 48,084

Unauthorised expenditure incurred not in accordance with the purpose of the vote or main division

Total 48,084 48,084

9.4. Details of unauthorised expenditure – current year

Incident Disciplinary steps taken/criminal proceedings

2012/13R’000

Total -

10. Fruitless and wasteful expenditure

10.1 Reconciliation of fruitless and wasteful expenditure1Note 2012/13 2011/12

R’000 R’000

Opening balance

Less: Amounts resolved - -

Current - -

Capital - -


Less: Amounts transferred to receivables for recovery - -

Fruitless and wasteful expenditure awaiting resolution - -

Analysis of awaiting resolution per economic classification

Current - -



170


Capital - -


Total - -

11. Cash and cash equivalents

Note 2012/13 2011/12

R’000 R’000

Consolidated Paymaster General Account - -

Cash receipts - -

Disbursements - -

Cash on hand 2 2

Total 2 2

12. Prepayments and advancesNote 2012/13 2011/12

R’000 R’000

Staff advances - -

Travel and subsistence 6 7

Prepayments - -

Total 6 7

13. Receivables2012/13 2011/12

R’000 R’000 R’000 R’000 R’000

Note Less than one year

One to three years

Older than three years Total Total

Claims recoverable 13.1Annex

4

45 105 98 248 283

Trade receivables 13.2 - -



171


Recoverable expenditure 13.3 6 6 15

Staff debt 13.4 36 36 35

Other debtors 13.5 - -

Total 87 105 98 290 333

13.1. Claims recoverable

Note 2012/13 2011/12

13 R’000 R’000

National departments - -

Provincial departments 248 283

Public entities - -

Universities and technikons - -

Households and non-profit institutions - -

Local governments - -

Total 248 283

13.2. Recoverable expenditure (disallowance accounts)

Note 2012/13 2011/12

13 R’000 R’000

(Group major categories, but list material items)

Salary Deductions - -

Salary Tax Debt 6 1

Salary Reversal Account - -

Salary ACB Recalls - -

Pension Recoverable - -

Claims Recoverable - -

Salary Income Tax - -

Salary Pension Fund - 14

Total 6 15



172


13.3. Staff debt

Note 2012/13 2011/12

13 R’000 R’000

(Group major categories, but list material items)

Salary and Tax Debt 36 35

Tax Debt - -

Total 36 35

14. Voted funds to be surrendered to the Revenue FundNote 2012/13 2011/12

R’000 R’000


Transfer from statement of financial performance 12,570 (1,265)

Add: Unauthorised expenditure for current year 9 - 4,634

Voted funds not requested/not received 1.1 - -

Transferred to retained revenue to defray excess expendi-ture (PARLIAMENT/LEGISLATURES ONLY)

21.1 - -

Paid during the year (10,498) -

Closing balance 12,555 10,483

15. Departmental revenue and NRF Receipts to be surrendered to the Revenue Fund

Note 2012/13 2011/12

R’000 R’000

Opening balance 93 96

Transfer from Statement of Financial Performance 6 313

Own revenue included in appropriation 452 431

Transfer from aid assistance 3 - -

Paid during the year (497) (747)



173


Closing balance 54 93

16. Bank OverdraftNote 2012/13 2011/12

R’000 R’000

Consolidated Paymaster General Account 31,574 33,682

Fund requisition account - -

Total 31,574 33,682

17. Payables – currentNote 2012/13 2011/12

R’000 R’000

Amounts owing to other entities - -

Advances received 17.1 - -

Clearing accounts 17.2 46 15

Other payables 17.3 3,287 3,287

Total 3,333 3,302

17.1. Clearing accounts

Note 2012/13 2011/12

17 R’000 R’000

Description

(Identify major categories, but list material amounts)

Salary Pension Fund 3

Salary ACB Recalls 17 7

Claims Recoverable 17 5

Cancel Cheque Re-issue 12 -

Total 46 15



174


17.2. Other payables

Note 2012/13 2011/12

17 R’000 R’000

Description

(Identify major categories, but list material amounts)

Housing Development Funds 3,287 3,287

Total 3,287 3,287

18. Net cash flow available from operating activitiesNote 2012/13 2011/12

R’000 R’000

Net surplus/(deficit) as per Statement of Financial Performance 12,576 (1,078)

Add back non cash/cash movements not deemed operating ac-tivities

(8,531) 2,315

(Increase)/decrease in receivables – current 43 (105)

(Increase)/decrease in prepayments and advances 1 111

(Increase)/decrease in other current assets - -

Increase/(decrease) in payables – current 31 (131)

Proceeds from sale of capital assets - (260)

Proceeds from sale of investments - -

(Increase)/decrease in other financial assets - -

Expenditure on capital assets 1,937 2,907

Surrenders to Revenue Fund (10,995) (747)

Surrenders to RDP Fund/Donor - -

Voted funds not requested/not received - -

Own revenue included in appropriation 452 431

Other non-cash items - 109

Net cash flow generated by operating activities 4,045 1,237



175


19. Reconciliation of cash and cash equivalents for cash flow purposes

Note 2012/13 2011/12

R’000 R’000

Consolidated Paymaster General account (31,574) (33,682)

Fund requisition account - -

Cash receipts - -

Disbursements - -

Cash on hand 2 2

Cash with commercial banks (Local) - -

Cash with commercial banks (Foreign) - -

Total (31,572) (33,680)



176


These amounts are not recognised in the Annual Financial Statements and are disclosed to enhance the usefulness of the Annual Financial Statements.

20. Contingent liabilities and contingent assets

20.1. Contingent liabilities

Note 2012/13 2011/12

R’000 R’000

Liable to Nature

Motor vehicle guarantees Employees Annex 3A 142 142

Housing loan guarantees Employees Annex 3A 40 40

Other guarantees Annex 3A - -

Claims against the department Annex 3B 4,294 4,840

Other departments (interdepartmental uncon-firmed balances)

Annex 5-

-

Environmental rehabilitation liability Annex 3B - -

Other Annex 3B - -

Total 4,476 5,022

20.1. Contingent Assets

Note 2012/13 2011/12

R’000 R’000

Nature of contingent asset

Counter claim against contractor for defaulting 3,812 3,812

On housing projects

Lawsuit against defaulting contractor i.r.o. housing 1,925 3,500

projects

S. Kies 148 -

JJ Van Heerden 105 -

SS Makubalo 30 -

- -

Total 6,020 7,312



177


21. CommitmentsNote 2012/13 2011/12

R’000 R’000

Current expenditure

Approved and contracted 2,689 896

Approved but not yet contracted 1,142

2,689 2,038

Capital expenditure

Approved and contracted 342,347 308,639

Approved but not yet contracted 524,396 15,283

866,743 323,922

Total Commitments 869,432 325,960

Only capital expenditure commitments related to Human Settlements are projects over one year period depending on the completion of the houses.

22. Accruals2012/13 2011/12

R’000 R’000

Listed by economic classification 30 Days 30+ Days Total Total

Goods and services 3,210 1,075 4,285 2,243

Interest and rent on land

Transfers and subsidies 36 50 86 10,166

Capital assets

Other 22 6 28 6

Total 3,268 1,131 4,399 12,415



178


Note 2012/13 2011/12

R’000 R’000

Listed by programme level

Administration 3,068 1,141

Human Settlements 451 10,487

Co-Operative Governance 680 710

Traditional Affairs 200 77

Total 4,399 12,415

Note 2012/13 2011/12

R’000 R’000

Confirmed balances with other departments Annex 5 36 422

Confirmed balances with other government entities Annex 5 - -

Total 36 422

23. Employee benefitsNote 2012/13 2011/12

R’000 R’000

Leave entitlement 6,911 6,735

Service bonus (Thirteenth cheque) 5,523 5,072

Performance awards 2,539 2,539

Capped leave commitments 3,455 3,347

Other - -

Total 18,428 17,693



179


Negative leave balance amounts to R581 412.07.

24. Lease commitments

24.1. Operating leases expenditure

2012/13Specialised

military equipment

Land

Buildings and other

fixed structures

Machin-ery and equipm

ent

Total

Not later than 1 year 4,293 - 525

Later than 1 year and not later than 5 years

16,194 - 22,757

Later than five years 7,997 - 10,258

Total lease commitments - - 28,483 - 33,540

2011/12Specialised

military equipment

Land

Buildings and other

fixed structures

Machinery and

equipmentTotal

Not later than 1 year 5,647 - 5,647


19,187 - 19,187

Later than five years 17,626 - 17,626

Total lease commitments - - 42,460 - 42,460

Note 2012/13 2011/12

R’000 R’000

Rental earned on lease sub-leased assets 3 - -

Total - -



180


24.2. Finance leases expenditure**2012/13 Specialised

military equipment

Land Buildings and other

fixed structures

Machinery and

equipment

Total

Not later than 1 year - - - 2,213 1,668


- - - 4,678 4,030

Later than five years - - - - -

Total lease commitments - - - 6,891 5,698

2011/12 Specialised military

equipment

Land Buildings and other

fixed struc-tures

Machinery and

equipment

Total

Not later than 1 year 1,448 1,448


4,524 4,524

Later than five years - -

Total lease commitments 5,972 5,972

LESS: finance costs 242 242

Total present value of lease liabilities

5,730 5,730



181


25. Irregular expenditure25.1. Reconciliation of irregular expenditure

2012/13 2011/12

R’000 R’000


Add: Irregular expenditure – relating to prior year (265,851) 629,596

Add: Irregular expenditure – relating to current year 107,282 50,123

Less: Amounts condoned (734) -

Less: Amounts recoverable (not condoned) -

Less: Amounts not recoverable (not condoned) -

Irregular expenditure awaiting condonation 564,406 723,709

The department is currently in the process of evaluating the irregular expenditure both in the department and that occurred with the Housing Fund at Municipalities.

Expenditure in the previous year’s statement erroneously disclosed (The process was completed up to the evaluation stage as per the irregular register). The amount of R 265 851 consist of R 247 997 still under evaluation and R17 854 is not classified as valid irregular.

Analysis of awaiting condonation per age classification

Current year 107,282 50,123

Prior years 457,124 673,586

Total 564,406 723,709



182


25.2. Details of irregular expenditure – current year

Incident Disciplinary steps taken/criminal proceedings 2012/13

R’000

Worldwide Travel 2,294

Lefatshe Tegnologies 8,999

Security Services - Kapa Bokone 6,866

Broll Property 1,072

Trifecta 623

Travel Agencies 613

Nugen 1,054

Housing Projects 79,262

Carlo’s Cleaning services 809

Ashly Gardening Services 101

NEAR 2,987

Fire Equipment 1,948

Charter Flights 75

SCM processes not followed 186

Overtime paid 31

Employees acting for more than 6 and 12 months 362

Total 107,282

25.3. Details of irregular expenditure condoned

Incident Condoned by (condoning authority) 2012/13

R’000

Ministerial Vehicle 734

Total 734



183


25.4. Details of irregular expenditure recoverable (not condoned)

Incident 2012/13

R’000

-

-

Total -

25.5. Details of irregular expenditure not recoverable (not condoned)

Incident Not condoned by (condoning authority) 2012/13

R’000

-

-

-

Total -

25.6. Details of irregular expenditures under investigation

Incident 2012/13

R’000

Current year (Housing projects - R79 262 ;SCM processes - R27 627 & HR -R393) 107,282

Prior years (Housing projects - R392 452 ; SCM processes - R54 185 & HR - R10 487) 457,124

Total 564,406



184


26. Fruitless and wasteful expenditure

26.1. Reconciliation of fruitless and wasteful expenditure

Note 2012/13 2011/12

R’000 R’000


Fruitless and wasteful expenditure – relating to prior year -

Fruitless and wasteful expenditure – relating to current year 30,376 10,961

Less: Amounts resolved -

Less: Amounts transferred to receivables for recovery -

Fruitless and wasteful expenditure awaiting resolution 48,695 18,319

26.2 Analysis of awaiting resolution per economic classification

Note 2012/13 2011/12

R’000 R’000

Current

Capital - -

Transfers and subsidies 48,695 18,319

Total 48,695 18,319

26.3. Analysis of Current year’s fruitless and wasteful expenditure

Incident Disciplinary steps taken/criminal proceedings 2012/13

R’000

Rectification at Soul City 30,376

-

-

Total 30,376



185


27. Related party transactionsRevenue received Note 2012/13 2011/12

R’000 R’000

Tax revenue/ User charges - -

Sales of goods and services other than capital assets - -

Fines, penalties and forfeits - -

Interest, dividends and rent on land - -

Sales of capital assets - -

Transactions in financial assets and liabilities - -

Transfers - -

Total - -

Payments made Note 2012/13 2011/12

R’000 R’000

Goods and services - 47

Interest and rent on land - -

Purchases of capital assets - -

Transactions in financial assets and liabilities - -

Transfers - -

Total - 47

List related party relationships• Department of Public Works - Lease of Head Office Building at free of charge

• Department of Public Works - Repayment of expenditure

• South African Police Service - Salary claim: W.R. Issacs Transfer

• N.C. Provincial Treasury - Donation to Universal Rugby Club

• Office of the Premier - Contribution toward War on poverty campaign

• Office of the Premier - Travel expenses

• Office of the Premier - Expenses related to Traditional affairs

• Office of the Premier - MEC expenses - Durban travel

• Office of the Premier - Advert - HOD post



186


28. Key management personnelNo. of Individuals 2012/13 2011/12

R’000 R’000

Political office bearers (provide detail below)

Officials:

Level 15 to 16 2 2,855 2,206

Level 14 (incl. CFO if at a lower level) 4 3,879 4,617

Family members of key management personnel - -

Total 6,734 6,823

29. Non-adjusting events after reporting date2012/13

Include an estimate of the financial effect of the subsequent non-adjusting events or a state-ment that such an estimate cannot be made.

R’000

-

-

-

Total -

30. Movable Tangible Capital AssetsMOVEMENT IN MOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED 31 MARCH 2013

Opening balance

Curr Year Ad-just-ments to prior year bal-

ances

Additions Disposals Closing Balance

R’000 R’000 R’000 R’000 R’000

HERITAGE ASSETS - - - - -

Heritage assets - - - - -

MACHINERY AND EQUIPMENT 18,409 (320) 1,659 138 19,610

Transport assets 2,790 - 1,135 - 3,925



187


Opening balance

Curr Year Ad-just-ments to

prior year balances


R’000 R’000 R’000 R’000 R’000

Computer equipment 8,795 - 190 60 8,925

Furniture and office equipment 5,258 - 182 62 5,378

Other machinery and equipment 1,566 (320) 152 16 1,382

SPECIALISED MILITARY ASSETS - - - - -

Specialised military assets - - - - -

BIOLOGICAL ASSETS - - - - -

Biological assets - - - - -

TOTAL MOVABLE TANGIBLE CAPITAL ASSETS

18,409 (320) 1,659 138 19,610

30.1. Additions

ADDITIONS TO MOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED 31 MARCH 2013

Cash Non-cash

(Capital Work in Progress cur-rent costs and finance lease

payments)

Received current, not paid

(Paid current year, received prior year)

Total

R’000 R’000 R’000 R’000 R’000



MACHINERY AND EQUIPMENT 1,659 - - - 1,659

Transport assets 1,135 1,135

Computer equipment 190 190

Furniture and office equipment 182 182



188


Cash Non-cash

(Capital Work in Progress cur-rent costs and finance lease

payments)

Received current, not paid

(Paid current year, received prior year)

Total

R’000 R’000 R’000 R’000 R’000

Other machinery and equipment 152 152

TOTAL ADDITIONS TO MOVABLE TANGIBLE CAPITAL ASSETS

1,659 - - - 1,659

30.2. Disposals

DISPOSALS OF MOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED 31 MARCH 2013

Sold for cash

Transfer out or destroyed or scrapped

Total dispos-als

Cash Received

Actual

R’000 R’000 R’000 R’000

HERITAGE ASSETS - - - -

Heritage assets - - - -

MACHINERY AND EQUIPMENT - 138 138 -

Transport assets - - - -

Computer equipment 60 60 -

Furniture and office equipment 62 62 -

Other machinery and equipment 16 16 -

TOTAL DISPOSAL OF MOVABLE TANGIBLE CAPITAL ASSETS

- 138 138 -



189


30.3. Movement for 2011/12

MOVEMENT IN MOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED 31 MARCH 2012

Opening balance Additions Disposals Closing bal-

ance

R’000 R’000 R’000 R’000

HERITAGE ASSETS -

Heritage assets -

MACHINERY AND EQUIPMENT 16,231 2,907 729 18,409

Transport assets 2,744 733 687 2,790

Computer equipment 7,527 1,310 42 8,795

Furniture and office equipment 4,561 697 - 5,258

Other machinery and equipment 1,399 167 - 1,566

SPECIALISED MILITARY ASSETS - - - -

Specialised military assets - - - -

BIOLOGICAL ASSETS - - - -

Biological assets - - - -

TOTAL MOVABLE TANGIBLE ASSETS 16,231 2,907 729 18,409



190


30.4. Minor assets

MOVEMENT IN MINOR ASSETS PER THE ASSET REGISTER FOR THE YEAR ENDED AS AT 31 MARCH 2013


Intangible assets

Heritage assets

Machinery and equip-

ment

Biological assets

Total

R’000 R’000 R’000 R’000 R’000 R’000

Opening balance - 1,079 - 4,276 - 5,355

Curr Year Adjustments to Pri-or Year balances (352)

- - - -

Additions - - 153 - 153

Disposals - - 112 - 112

TOTAL MINOR ASSETS - 727 - 4,317 - 5,396

Spe-cialised military assets

Intangible assets

Heritage assets

Machinery and equip-

ment

Biological assets

Total

Number of R1 minor assets - 2 - 996 - 998

Number of minor assets at cost

- 351 - 2,627 - 2,978

TOTAL NUMBER OF MINOR AS-SETS

- 353 - 3,623 - 3,976

MOVEMENT IN MINOR ASSETS PER THE ASSET REGISTER FOR THE YEAR ENDED AS AT 31 MARCH 2012


Intangible assets

Heritage assets

Machinery and

equipment

Biological assets

Total

R’000 R’000 R’000 R’000 R’000 R’000

Opening balance - 811 - 4,153 - 4,964

Additions - 268 - 124 - 392

Disposals - - - 1 - 1

TOTAL MINOR ASSETS - 1,079 - 4,276 - 5,355



191


31. Intangible Capital Assets

MOVEMENT IN INTANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED 31 MARCH 2013

Opening balance

Current Year Adjust-ments to prior year

balances


R’000 R’000 R’000 R’000 R’000

COMPUTER SOFTWARE 628 - - - 628

MASTHEADS AND PUBLISHING TITLES - - - -

PATENTS, LICENCES, COPYRIGHT, BRAND NAMES, TRADEMARKS - - - - -

RECIPES, FORMULAE, PROTOTYPES, DESIGNS, MODELS - - - - -

SERVICES AND OPERATING RIGHTS - - - - -

TOTAL INTANGIBLE CAPITAL ASSETS 628 - - - 628



192



MOVEMENT IN INTANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED 31 MARCH 2012

Opening bal-ance

Additions Disposals Closing balance

R’000 R’000 R’000 R’000

628 - - 628

COMPUTER SOFTWARE

MASTHEADS AND PUBLISHING TITLES - - - -

PATENTS, LICENCES, COPYRIGHT, BRAND NAMES, TRADEMARKS - - - -

RECIPES, FORMULAE, PROTOTYPES, DESIGNS, MODELS - - - -

SERVICES AND OPERATING RIGHTS - - - -

TOTAL INTANGIBLE CAPITAL ASSETS 628 - - 628

32. Immovable Tangible Capital Assets

MOVEMENT IN IMMOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED 31 MARCH 2013

Opening bal-ance

Curr Year Adjustments to

prior year balances


R’000 R’000 R’000 R’000 R’000

BUILDINGS AND OTHER FIXED STRUCTURES 547 - 14 - 561

Dwellings - - - - -

Non-residential buildings - - - - -

Other fixed structures 547 - 14 - 561





193


R’000 R’000 R’000 R’000 R’000

LAND AND SUBSOIL ASSETS - - - - -

Land - - - - -

Mineral and similar non-regenerative resourc-es

- - - - -

- - - - -

TOTAL IMMOVABLE TANGIBLE CAPITAL ASSETS

547 - 14 - 561

32.1. Additions

ADDITIONS TO IMMOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED 31 MARCH 2013

Cash Non-cash (Capital Work in Progress current

costs and finance lease payments)

Received cur-rent, not paid(Paid current year, received

prior year)

Total

R’000 R’000 R’000 R’000 R’000

BUILDING AND OTHER FIXED STRUCTURES 14 - - - 14

Dwellings - - - - -

Non-residential buildings - - - - -

Other fixed structures 14 - - - 14



LAND AND SUBSOIL ASSETS - - - - -

Land - - - - -

Mineral and similar non-regenerative resources - - - - -

- - - -

TOTAL ADDITIONS TO IMMOVABLE TANGIBLE CAPITAL ASSETS 14 - - - 14



194



MOVEMENT IN IMMOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED 31 MARCH 2012

Opening balance

Additions Disposals Closing balance

R’000 R’000 R’000 R’000

BUILDINGS AND OTHER FIXED STRUC-TURES

547 - - 547

Dwellings - - - -

Non-residential buildings - - - -

Other fixed structures 547 - - 547

HERITAGE ASSETS - - - -

Heritage assets - - - -

LAND AND SUBSOIL ASSETS - - - -

Land - - - -

Mineral and similar non-regenerative resources

- - - -

TOTAL IMMOVABLE TANGIBLE ASSETS 547 - - 547



195

1.

STAT

EMEN

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CON

DITI

ONAL

GRA

NTS

RECE

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NAM

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DE

PAR

TMEN

T

GRAN

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LOCA

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SPEN

T20

11/1

2

Division of Revenue Act/ Provincial Grants

Roll Overs

DORA Adjustments

Other Adjustments

Total Available

Amount received by department

Amount spent by department

Under / (Overspending)

% of available funds spent by department

Division of Revenue Act

Amount spent by department

R’00

0R’

000

R’00

0R’

000

R’00

0R’

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R’00

0R’

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R’00

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9,55

133

9,55

133

9,55

133

9,54

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332,

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332,

983

TOTA

L33

9,55

1-

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339,

551

339,

551

339,

540

1133

2,98

933

2,98

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196

ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTSfor the year ended 31 March 2013

ANNEXURE 1ASTATEMENT OF CONDITIONAL GRANTS PAID TO MUNICIPALITIES

NAM

E OF M

UNICIPALITY

GRANT ALLOCATION TRANSFER SPENT 2011/12


Roll Overs

Adjustments

Total Available

Actual Transfer

Funds Withheld

Re-allocations by National Treasury or National Departm

ent

Amount received by m

unicipality

Amount spent by m

unicipality

% of available funds spent by

municipality


R’000 R’000 R’000 R’000 R’000 % R’000 R’000 % R’000

FIRE EQUIP-MENT

Frances Baard District 389 389 389 389 389 371

Pixley ka Seme District 389 389 389 389 389 371

Kgalagadi District Mu-nicipality

390 390 390 390 390 371

Namakwa District Municipality

390 390 390 390 390 371

Karoo District Municipality

Siyanda Dis-trict Munici-pality

390 390 390 390 390 371

Sol Plaatje (Emergency Grant)

NEAR SYS-TEM GRANT

Frances Baard District 607 607 607 607 569

Pixley ka Seme District 601 601 601 601 563



197


R’000 R’000 R’000 R’000 R’000 % R’000 R’000 % R’000

Kgalagadi District Mu-nicipality

421 421 421 421 391

Namakwa District Mu-nicipality

801 801 801 801 754

Karoo District Municipality 557 557 557 557 521

Siyanda District Municipality

SANITATION

Namakwa District Mu-nicipality

8,692

Magareng

RESORTS

Sol Plaatje 612

GURP

Sol Plaatje 5,831

NALA PRO-JECT

PD:Vehicle Licenses 71 10,000

TOTAL 4,935 5,006 29,788



198


ANNEXURE 1CSTATEMENT OF TRANSFERS TO DEPARTMENTAL AGENCIES AND ACCOUNTS

DEPARTMENT/ AGENCY/ ACCOUNT

TRANSFER ALLOCATION TRANSFER 2011/12

Adjusted Appro-priation

Roll Overs

Adjustments

Total Available

Actual Transfer

% of Available funds

Transferred

Appropriation Act

R’000 R’000 R’000 R’000 R’000 % R’000

SALGA 500 - - 500 500 100% 500

TOTAL 500 - - 500 500 500



199


ANNEXURE 1HSTATEMENT OF TRANSFERS TO HOUSEHOLDS

HOUSEHOLDS

TRANSFER ALLOCATION EXPENDITURE 2011/12

AdjustedAppropriation

Act

Roll Overs

Adjust-ments

Total Available

Actual Transfer

% of

Available funds Transferred

Appro-priation Act

R’000 R’000 R’000 R’000 R’000 % R’000

Transfers

H/H Empl S/Ben:Injury on Duty 27

H/H Empl S/Ben: Leave Grat 266 1,063

Human Settlement Re-dev Pro 339,551 339,551 339,540 100% 332,989

Pocket Money

Households(Stipends for Trad Houses Volun-teers)

1,097 1,197

339,551 339,551 340,903 335,276

Subsidies

TOTAL 339,551 339,551 340,903 335,276



200


ANNEXURE 1KSTATEMENT OF GIFTS, DONATIONS AND SPONSORSHIPS MADE AND REMMISSIONS,

REFUNDS AND PAYMENTS MADE AS AN ACT OF GRACE

NATURE OF GIFT, DONATION OR SPONSORSHIP(Group major categories but list material items including name of organisation

2012/13 2011/12

R’000 R’000

Paid in cash

Donations and promotional items 80

Universal football club 10

Subtotal - 90

Made in kind

Donations and Promotional items 57

Subtotal 57

Remissions, refunds, and payments made as an act of grace

4

Subtotal

TOTAL 57 90



201


ANNEXURE 3ASTATEMENT OF FINANCIAL GUARANTEES ISSUED AS AT 31 MARCH 2013 – LOCAL

Guarantor institution

Guarantee in respect of

Original guaranteed capital am

ount

Opening balance 1 April 2012

Guarantees draw dow

nsduring the year

Guarantees repayments/ can-

celled/ reduced/ released during the year

Revaluations

Closing balance31 M

arch 2013

Guaranteed interest for year ended 31 M

arch 2013

Realised losses not recoverable i.e.

claims paid out

R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000

Motor

vehicles142 142

Subtotal 142 142

Housing 40 40

Subtotal 40 40

Other - -

Subtotal - -

TOTAL 182 182



202


ANNEXURE 3A (continued)STATEMENT OF FINANCIAL GUARANTEES ISSUED AS AT 31 MARCH 2012 – FOREIGN

Guarantor institution

Guarantee in respect of

Original guaranteed capital am

ount

Opening balance 1 April 2012

Guarantees draw dow

nsduring the year

Guarantees repayments/

cancelled/ reduced/ released during the year

Revaluations

Closing balance31 M

arch 2013

Guaranteed interest for year ended 31 M

arch 2013

Realised losses not recoverable i.e. claim

s paid out

R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000

Motor vehicles

SubtotalHousing

SubtotalOther

Subtotal

Total



203


ANNEXURE 3BSTATEMENT OF CONTINGENT LIABILITIES AS AT 31 MARCH 2013

Nature of Liability

OpeningBalance

1 April 2012

Liabilities in-curred during

the year

Liabilities paid/can-celled/re-

duced during the year

Liabilities recoverable

(Provide details hereunder)

ClosingBalance

31 March 2013

R’000 R’000 R’000 R’000 R’000

Claims against the

department

Building Contractor – New Way Development 2,883 150 1,517 - 1,517

Barnard JH 55 20 45 - 30

Young Alum SA 1,902 103 802 - 1,203

Matupe D - 217 - - 217

Komanisi Developers CC (Counter claim) - 2,950 1,622 - 1,328

Subtotal 4,840 3,440 3,986 - 4,294

Environmental Liability

Subtotal

Other

Subtotal

TOTAL 4,840 3,440 3,986 - 4,294



204


ANNEXURE 4CLAIMES RECOVERABLE

Government Entity

Confirmed balance outstanding

Unconfirmed balance outstanding Total

31/03/2013 31/03/2012 31/03/2013 31/03/2012 31/03/2013 31/03/2012

R’000 R’000 R’000 R’000 R’000 R’000

Department

Department of Human Settlements – Free State

33 - - - 33 -

Department of Agri-culture, Forestry and Fisheries

5 - - - 5 -

Department of Safety and Liaison 111 - - - 111 -

149 - - - 149 -

Other Government Entities

TOTAL 149 149



205


ANNEXURE 5INTER-GOVERNMENT PAYABLES

G O V E R N M E N T ENTITY

Confirmed balance outstanding

Unconfirmed balance outstanding TOTAL

31/03/2013 31/03/2012 31/03/2013 31/03/2012 31/03/2013 31/03/2012

R’000 R’000 R’000 R’000 R’000 R’000

DEPARTMENTS

Current

Office of the Premier 16 206 - - 16 206

Dept Transpt, Roads &Pub Works - 149 - - - 149

South African Police Services - 56 - - - 56

Dept of Premier – Free State - 1 - - - 1

Provincial Treasury - 10 - - - 10

Dept of Human Settlements – 7 - - - 7 -

Free-State

SASSA 13 - - - 13 -

Subtotal 36 422 - - 36 422

Non-current

Subtotal

Total 36 422 - - 36 422

OTHER GOVERN-MENT ENTITY

Current



206


31/03/2013 31/03/2012 31/03/2013 31/03/2012 31/03/2013 31/03/2012

R’000 R’000 R’000 R’000 R’000 R’000

Subtotal

Non-current

Subtotal

Total

ANNEXURE 6INVENTORY

InventoryNote Quantity 2012/13 Quantity 2011/12

R’000 R’000

Opening balance 5,830 415,008 3,229 227,345

Add/(Less): Adjustments to prior year balance 461 20,976

Add: Additions/Purchases - Cash 3,613 339,540 3,683 332,969

Add: Additions - Non-cash - - (1,543) (166,282)

(Less): Disposals - -

(Less): Issues (2,839) (190,213)

Add/(Less): Adjustments - -

Closing balance 6,604 564,335 5,830 415,008



207

Northern Cape Housing Development Fund

Annual Financial Statements

for the year ended

31 March 2013



208

Report by the Accounting Officer for the year ended 31 March 2013

1. General review of the state of financial affairsThe Northern Cape Housing Development Fund is dormant and received no further funding during the year. The Income and expenditure that is reflected in the statement Financial Performance are receipts received from its debtors (namely, suspensive sale, rental and individual loan debtors) and expenditure in relation to municipal rates and taxes

2. GeneralThe Housing Fund was setup as a conduit for national housing funding and to hold all housing assets in the province. With the introduction of the housing conditional grant, the Department received funding appropri-ated into the budget of the Department through the budget processes. This meant there was no longer a need for the existence of a Housing Fund to receive the funding for housing.

There has been a national decision to de-establish the Housing Fund in all Provinces; however the legislative changes to the National Housing Act have not yet been enacted to allow for the de-establishment the Northern Cape Housing Development Fund

3. Overview of operations during the yearDuring the 2013 the housing fund undertook an exercise of devolving all its properties to the various local au-thorities in the northern cape province, the debtors system was finalised and closed off during the end of the 2012 financial year as a result no transactions took place on the debtor system during the 2013 financial year As at year end of financial year the housing fund did not have any sales, rental and loan debtors.As at year end the fund had properties amounting to R3.3 million which are in the process of being devolved to the local municipalities in the Northern Cape Province.We expect to devolve all properties during the 2014 financial year

4. Events after the reporting dateNo other material events occurred after the reporting date have occurred which may impact on the financial statements of the fund.

5. ApprovalThe attached financial statements set out in pages 209 to 214 have been approved by the Accounting Officer.

________________________

Mr BS LenkoeAccounting Officer(Northern Cape Department Coghsta)31 May 2013



209

Statement of Financial Position

Restated Notes 2013 2012

Assets

Non-Current Assets 3,334,154 4,266,633

Property, plant and equipment2

3,334,154 4,266,633

Current Assets 3,287,000 3,287,000

Trade and Other Receivables 3 3,287,000 3,287,000

TOTAL ASSETS 6,621,154 7,553,633

NET ASSETS AND LIABILITIES

Net Assets 6,612,756 7,413,385

Accumulated Surplus 6,612,756 7,413,385

Current Liabilities 8,398 140,248

Trade and other payables 7 8,398 140,248

TOTAL NET ASSETS AND LIABILITIES 6,621,154 7,553,633



210

Northern Cape Housing Development Fund Annual Financial Statements for the year ended 31 March 2013

REPORT OF THE AUDITOR-GENERAL TO THE PROVINCIAL LEGISLATURE ON NORTHERN CAPE HOUSING DEVELOPMENT FUND

REPORT ON THE FINANCIAL STATEMENTS

Introduction1. I have audited the financial statements of the entity set out on pages 213 to 225, which comprise the state-ment of financial position as at 31 March 2013, the statement of financial performance (GRAP), statement of changes in net assets (GRAP) and the cash flow statement (GRAP) for the year then ended 31 March 2013, and the notes, comprising a summary of significant accounting policies and other explanatory information.

Accounting authority’s responsibility for the financial statements2. The accounting authority is responsible for the preparation and fair presentation of these financial statements in accordance with the South African Standards of Generally Recognised Accounting Practice (SA Standards of GRAP) and the requirements of the Housing Act of South Africa, 1997 (Act No. 107 of 1997) and for such internal control as the accounting authority determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor-General’s responsibility3. My responsibility is to express an opinion on these financial statements based on my audit. I conducted my audit in accordance with the Public Audit Act of South Africa, 2004 (Act No. 25 of 2004) (PAA), the General Notice issued in terms thereof and International Standards on Auditing. Those standards require that I com-ply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

4. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circum-stances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.



211


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

Opinion6. In my opinion, the financial statements present fairly, in all material respects, the financial position of the entity as at 31 March 2013, and its financial performance and cash flows for the year then ended in accord-ance with SA Standards of GRAP and the requirements of the Housing Act of South Africa, 1997 (Act No. 107 of 1997)

Emphasis of matters7. I draw attention to the matters below. My opinion is not modified in respect of these matters.

Restatement of corresponding figures8. As disclosed in note 9 to the financial statements, the corresponding figures for 2011-12 have been restat-ed as a result of an error discovered during 2012-13 in the financial statements of the Northern Cape Housing Development Fund at, and for the year ended, 2011-12.

Related Parties9. As disclosed in note 5 to the financial statements, the Northern Cape Housing Development Fund’s oper-ations and management decisions are controlled by the Northern Cape Department of Co-operative Govern-ance, Human Settlements and Traditional Affairs. Amounts included in Trade Receivables regarding related parties are R 3 287 000.

Going concern10. As disclosed in note 6 to the financial statements, the fund is in the process of de-establishing and will probably transfer all remaining properties to local authorities during the 2014 financial year.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS 11. In accordance with the PAA and the General Notice issued in terms thereof, I report the following findings relevant to performance against predetermined objectives, compliance with laws and regulations and internal control, but not for the purpose of expressing an opinion.

Predetermined objectives12. I was unable to conduct the audit of performance against predetermined objectives as the Northern Cape Housing Development Fund is not required to prepare a report on its performance against predetermined objectives. The Northern Cape Housing Development Fund does not fall within the ambit of the PFMA and the



212


entity-specific legislation does not require the reporting on performance against predetermined objectives.

Compliance with laws and regulations13. I did not identify any instances of material non-compliance with specific matters in key applicable laws and regulations as set out in the General Notice issued in terms of the PAA.

Internal control14. I considered internal control relevant to my audit of the financial statements, annual performance report and compliance with laws and regulations. The matters reported below under the fundamentals of internal control are limited to the significant deficiencies that resulted in the findings on the annual performance re-port and the findings on compliance with laws and regulations included in this report.

Leadership15. Sufficient oversight was not exercised to ensure that accounting records were complete. No internal ca-pacity plan to ensure compilation of annual financial statement.

Financial and performance management16. Lack of proper record keeping to ensure complete, relevant and accurate information was accessible and available to support the financial report.

Kimberley

31 July 2013



213


Statement of Financial Position

Restated Notes 2013 2012

Assets

Non-Current Assets 3,334,154 4,266,633

Property, plant and equipment 2 3,334,154 4,266,633

Current Assets 3,287,000 3,287,000

Trade and Other Receivables 3 3,287,000 3,287,000

TOTAL ASSETS 6,621,154 7,553,633

NET ASSETS AND LIABILITIES

Net Assets 6,612,756 7,413,385

Accumulated Surplus 6,612,756 7,413,385

Current Liabilities 8,398 140,248

Trade and other payables 7 8,398 140,248

TOTAL NET ASSETS AND LIABILITIES 6,621,154 7,553,633



214


Statement of Financial Performance

Notes 2013 2012

R RRevenue 158,409 -

Other Income 8 158,409

Operating expenses (959,038) (659,107)

Rebates - 28,960

Write offs 4 - 546,241

Devolution 932,479 40,692

Rates and Taxes 26,559 43,214

Deficit for the period (800,629) (659,107)

Statements of Changes in Net Assets Note Accumulated Surplus

Total

R R

Balance as at 31 March 2012 7,363,648 7,363,648

Prior period error 9 49,737 49,737

Restated Balance as at 31 March 2012 7,413,385 7,413,385

Deficit for the period (800,629) (800,629)

Balance as at 31 March 2013 6,612,756 6,612,756



215


Accounting Policies1. Basis of preparation The Annual Financial Statements are presented in South African Rand. They are prepared on the historical cost basis. Using the accrual basis of accounting except as stated otherwise, under the accrual basis of ac-counting, transactions and other events are recognised when incurred and not when cash is received or paid.

The Annual Financial Statements have been prepared in accordance with Generally Recognised Accounting Practice (GRAP) as per Directive No 5 Issued by the Accounting Standards Board.

No Cash Flow statement is prepared for the housing fund as payments and receipts of cash are being paid and received by the Department of Co-operative Governance, Human Settlements and Traditional Affairs.

Changes in accounting standards and presentation of financial statements.

Prior to 1 April 2009, the housing fund adopted South African Statements of Generally Accepted Accounting Practice (SA GAAP) as its reporting framework

The Housing fund has adopted where applicable the following GRAP Accounting standards and pronounce-ments as per Directive No 5 Issued by the Accounting Standards Board (ASB) as of 1 April 2009:

• GRAP 1 Presentation of Financial Statements• GRAP 2 Cash Flow Statements• GRAP 3 Accounting Policies, Changes in Accounting Estimates and Errors• GRAP 4 The Effects of Changes in Foreign Exchange Rates• GRAP 5 Borrowing Costs• GRAP 6 Consolidated and Separate Financial Statements• GRAP 7 Investments in Associates• GRAP 8 Interests in Joint Ventures• GRAP 9 Revenue from Exchange Transactions• GRAP 10 Financial Reporting in Hyperinflationary Economies• GRAP 11 Construction Contracts• GRAP 12 Inventories• GRAP 13 Leases• GRAP 14 Events After the Reporting Date• GRAP 16 Investment Property• GRAP 17 Property, Plant and Equipment• GRAP 19 Provisions, Contingent Liabilities and Contingent Assets• GRAP 100 Non-current Assets Held for Sale and Discontinued Operations• GRAP 101 Agriculture• GRAP 102 Intangible Assets



216


Accounting PoliciesThe following standards were approved by the Accounting Standards Board but are not yet effective:

GRAP 25 Employee benefitsGRAP 104 Financial instrumentsGRAP 105 Transfers of Functions between Entities Under Common ControlGRAP 106 Transfers of Functions between Entities Not Under Common ControlGRAP 107 Mergers

We have assessed the effect of these standards and have only developed policies where the standard will be applicable to our entity.

The recognition and measurement principles in GRAP and SA GAAP Statements do not differ or result in ma-terial differences in items presented and disclosed in the Annual Financial Statements. The implementation of GRAP 1 and 3 has resulted in the following significant changes in the presentation of the Annual Financial Statements:

Standard of GRAP Standard of SA GAAP

Statement of Financial Position Balance Sheet

Statement of Financial Performance Income Statement

Statement of Changes in Net Assets Statements of Changes in Equity

Net Assets Equity

Surplus / Deficit for the period Profit / Loss for the period

Accumulated Surplus / Deficit Retained Earnings

Reporting date Balance Sheet date

1.2 Significant Accounting judgementsThe preparation of the Housing fund financial statements requires management to make judgments, esti-mates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of contingent liabilities, at the end of the reporting period. However, uncertainty about these as-sumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of the asset or liability affected in future periods. In the process of applying the Housing fund’s accounting policies, management has made the following judgments, which have the most significant effect on the amounts recognised in the consolidated financial statements:



217


Accounting PoliciesAllowance for doubtful debtThe Housing fund assesses at each reporting date whether there is any objective evidence that a debtor is impaired. A debtor is deemed to be impaired if, and only if, there is objective evidence of impairment as a result of one or more events that has occurred after the initial recognition of the debtor (an incurred ‘loss event’) and that loss event has an impact on the estimated future cash flows that are recoverable from the debtor. Evidence of impairment may include indications that the debtors or a group of debtors is experiencing significant financial.

Difficulty, default or delinquency in interest or principal payments, and debtor amounts outstanding are older than 120 days.

1.3 Property, Plant and EquipmentProperty, plant and equipment’s consists of land and buildings.Properties owned by the housing fund are held at historical cost, the fund does not depreciate its property, or annually perform an assessment of useful lives as it is impracticable and the associated cost thereof would exceed the benefit of such an exercise for financial reporting purposes.

1.4 Financial Assets, and Liabilities

1.4.1 Initial RecognitionFinancial instruments are recognised initially when the Housing Fund becomes a party to the contractual provisions of the instruments. The Housing Fund classifies financial instruments, or` their component parts, on initial recognition as a financial asset, a financial liability or an equity instrument in accordance with the substance of the contractual arrangement. Financial instruments are measured initially at fair value, except for equity investments for which a fair value is not determinable, which are measured at cost and are classified as available for sale financial assets. For financial instruments which are not at fair value through profit or loss, transaction costs are included in the initial measurement of the instrument. Regular wpurchases of financial assets are accounted for at trade date.

1.4.2 Trade ReceivablesTrade Receivables included in the statement of financial position comprises of suspensive sale debtors, individual loan debtors and debtor clearing accounts.

Trade receivables are measured at initial recognition at fair value, and are subsequently measured at amortised cost using the effective interest rate method. Appropriate allowances for estimated irrecoverable amounts are recognised in surplus and deficit when there is objective evidence that the asset is impaired.

Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payments (more than 120 days Overdue) are considered indi-cators that the trade receivable is impaired. The allowance recognised Is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at the effective



218


Accounting Policiesinterest rate computed at initial recognition.

The carrying amount of the asset is reduced through the use of an allowance account, and the amount of the deficit is recognised in the statement of financial performance within operating expenses. When a trade receivable is uncollectible, it is written off against the allowance account for trade receivables. Subsequent recoveries of amounts previously written off are credited against operating expenses in the statement of financial performance.

1.4.3 Trade and Other PayablesTrade and other payables are initially measured at fair value, and are subsequently measured at amortised cost, using the effective interest rate method. Trade and other payables are classified as financial liabilities at amortised cost.

1.5 RevenueRevenue is measured at the fair value of the consideration received or receivable and represents the amounts received or receivable. Revenue is recognised when it is probable those future economic benefits will flow to the housing fund and that these benefits can be measured reliably.

1.6 Interest IncomeInterest income is accrued on a time proportioned basis, taking into account the principal outstanding and the effective interest rate over the period to maturity.

The Induplum rule is applied and therefore interest will be levied up to the point where the total interest lev-ied on an account balance equal the capital amount of the loan. induplum interest is written off against the accumulated surplus.

1.7 Rental IncomeRental Income is recognised in accordance with the relevant lease terms of the lease agreement

1.8 Non-Current Assets Held for SaleNon-current assets held for sale are classified as held for sale when their carrying amount is to be recovered principally through a sale transaction and the sale is considered highly probable. They are stated at the lower of carrying amount and fair value less costs to sell if their carrying amount is to be recovered principally through a sale transaction rather than continuing use

The following conditions must be met for an asset to be classified as held for sale:

• management is committed to a plan to sell

• the asset is available for immediate sale



219


Accounting Policies• an active programme to locate a buyer is initiated

• the sale is highly probable, within 12 months of classification as held for sale (subject to limited exceptions)

• the asset is being actively marketed for sale at a sales price reasonable in relation to its fair value

• actions required to complete the plan indicate that it is unlikely that plan will be significantly changed or withdrawn

1.9 Related PartiesThe Housing Fund operates in an economic environment currently dominated by entities directly or indirectly owned by the South African government. All national departments of government and state-controlled entities are regarded as related parties in accordance with Circular 4 of 2005: Guidance on the term “state controlled entities” in context of IAS 24 (AC 126), Related Parties, issued by the South African Institute of Chartered Ac-countants. Other related party transactions are also disclosed in terms of the requirements of the accounting standard.



220


Notes to the Financial StatementsNotes to the Financial Statements

2013 2012

R R

2. Property, Plant and Equipment

Opening Carrying Amount4,266,633 4,257,588

Disposals and devolutions (932,479) (40,692)

Prior Year Adjustment - 49,737

Closing Carrying Amount 3,334,154 4,266,633

The fund is currently in the process of transferring the above mentioned properties to the various local authorities through a devolution process.

A register containing information on the properties owned by the Fund is available for inspection at the funds registered address.

3. Trade and Other receivables

NC Department of Coghsta 3,287,000 3,287,000

3,287,000 3,287,000

There are no provisions held against trade and other receivables from the department

Notes to the Financial Statements4. Write offs

2013 2012

R R

Housing Loan debtors - 546,241

- 546,241



221


Notes to the Financial Statements5. Related Parties

The housing fund’s operations and management decisions are controlled by the Northern Cape department of cooperative governance, Human settlements and traditional affairs

Amounts included in Trade Receivables regarding related parties:

NC department of Coghsta 3,287,000 3,287,000

3,287,000 3,287,000

The receivables from the related parties arise mainly from income and expenses of the housing fund which are paid for by the department. The receivables are unsecured in nature and bear no interest. There are no provisions held against receivables from the department

6 Going Concern

There has been a national decision to de-establish the Housing Fund in all provinces; however, the legislative changes to the National Housing Act, 1997 (Act No 107 of 1997) have not yet been enacted to allow for the de-establishment of the Northern Cape Housing Fund, the fund will probably transfer all remaining properties to local authorities during the calendar year 2014



222


Notes to the Financial Statements

7. Trade and Other payables 2013 2012

R R

Municipal Rates and Taxes 8,398 140,248

8,398 140,248

8. Other Income 2013 2012

R R

NC Coghsta – Grant for payment of expenses 158’409 -

158’409 -

The department paid rates and taxes and property transfer fees on behalf of the fund , this payment is treated as income in the accounting records of the housing fund.

9. Prior Year ErrorProperty register understated in the accounting records, due to a calculation error

The effect of the above error is as follows:

Increase in Property, Plant and Equipment 49,737

Increase in Retained Earnings 49,737

Restatements have been made to the earliest periods presented in accordance with GRAP 3 Accounting Policies, Changes in Accounting Estimates and Errors

10. Financial Instruments and Risk Management

The fund’s financial instruments consist mainly of trade and other receivables and trade and other payables. All financial instruments are measured and recognised at fair value.

Trade receivables and payables approximate their fair value due to the short term nature of these instruments. the fair values together with the carrying amounts have been determined by using available market informa-tion and are presented in the Statement of Financial Position as detailed below:



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Notes to the Financial Statements

Financial assets - at carrying value 2013 2012

R R

Trade and other receivables 3,287,000 3,287,000

TOTAL 3,287,000 3,287,000

Financial liabilities - at carrying value 2013 2012

R R

Trade and other payables 8,398 140,248

TOTAL 8,398 140,248



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Fair value of financial instruments:

Financial assets - at fair value 2013 2013

R R

Trade and other receivables 3,287,000 3,287,000

TOTAL 3,287,000 3,287,000

Financial liabilities - held at amortised cost: 2013 2013

R R

Trade and other payables 8,398 140,248

TOTAL 8,398 140,248

Financial InstrumentsPotential concentrations of credit risk consist mainly of trade receivables from the funds related party .

At 31 March 2013, the fund did not consider there to be any significant concentration of credit risk which had not been adequately provided for.

Fair Value of Financial InstrumentsThe carrying amounts of the following financial instruments, approximate their fair value due to the fact that these instruments are predominantly short term nature.

- Trade and Other receivables - due to the short term nature of entity’s receivables, amortised cost approxi-mates its fair value.

- Trade and Other payables - are subject to normal trade credit terms and short payment cycles. The cost of other payables approximates its fair value.

No financial instrument is carried at an amount in excess of its fair value.

Risk ManagementLiquidity risk

Liquidity risk is the risk that an fund will be unable to meets its obligations as they become due.

The fund’s approach to managing liquidity risk is to ensure that sufficient liquidity is available to meet its liabilities when due under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the funds’ reputation.



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The fund ensures it has sufficient access to facilities to meet expected operational expenses, including the servicing of financial obligations; this excludes the potential impact of extreme circumstances that cannot reasonably be predicted, such as natural disasters.

The fund manages liquidity risk through the compilation and monitoring of cash flow forecasts as well as ensuring that there are adequate banking facilities.

Maturity Period 0 – 12 Months 1 - 5 Years > 5 Years

Financial Assets

Trade and other receivables 3,287,000 - -

Financial Liabilities

Trade and other payables 8,398 - -

Market riskMarket risk is the risk that changes in market prices (interest rate) will affect the fund’s income or the value of its holding of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return

Interest rate riskThe fund does not have significant interest-bearing assets, and therefore the fund’s income and operating cash flows are substantially independent of changes in market interest rates.

Foreign exchange risk managementThe fund is not exposed to any foreign exchange risk as it does not enter into any foreign exchange contracts.

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