Finance Report
Financial Quarter ending 31
December 2015
2015/2016 Financial Year
1
Table of contents
•
•
•
•
•
•
•
Financial Performance and Budget Management
Financial Position
Cash flow management
Management Accounts – Analytics
Corporate Services
Risk Management
Audit and PFMA related matters
2
Statement of Financial Performance for the quarter to 31 December 2015
2015
R
Revenue
Revenue from non-exchange transactions
Other income
Total revenue
Expenses
Operating expenses
Personnel Costs
Other administrative expenses
Finance costs
Assets written off
Depreciation and amortisation
Total
Surplus for the year
2014
R
16 923 000
784 622
17 707 622
16 809 000
207 261
17 016 261
####
####
####
4 081 451
11 496 998
279 634
-
5 031 172
10 828 107
143 209
1 826 722
####
####
779 880
16 637 963
336 734
18 165 944
1 069 659
(1 149 683)
####
####
3
Summary analysis for Q3 results
• Transfers according to allocation at R16, 9 million. Other
income recorded at R784k
• Expenditure at R16, 7 million, leaving an operating surplus of
R1, 1 million
• Compared to previous period, efficiency gains recorded due to
cost containment efforts and other dynamic/innovative
interventions to deliver services cost effectively (e.g.
partnering internally and with external stakeholders)
• Spending was within budget
4
Statement of Financial Performance for the year to 31 December 2015
2015
R
Revenue
Revenue from non-exchange transactions
Other income
Total revenue
50 769 000
1 472 157
52 241 157
2014
R
50 427 000
1 833 731
52 260 731
Actual comparative
figures
60000
50000
40000
30000
Expenses
Operating expenses
Personnel Costs
Other administrative expenses
Finance costs
Depreciation and amortisation
Total
13 390 340
36 329 457
1 111 765
311
532 413
51 364 287
15 415 663
35 512 077
631 972
1 826 722
666 966
54 053 400
Surplus/(Deficit) for the year
876 870
(1 792 669)
20000
10000
0
2015
2014
5
Summary analysis on YTD results – 31Dec2015
• Transfers for the three quarters were in line with official
appropriation at R50, 8 million or 75% of total annual allocation.
Other income of about R1, 5 million includes R951, 000 donation
from SABC for the Women month and 16 days activities during the
year under review. The remainder is largely interest income from
cash held in the current account at the bank.
• Total expenditure was R51, 4 m (9 months) compared to R54 m in
the previous year (same period). The overall spending is within
revenue recorded in the 9 months’ period resulting to a net surplus
of R876, 870. The surplus is attributable to efficiency gains in the
main.
• It is projected that by the end of the financial year, the
Commission’s spending will be within budget.
6
Year to 31 December 2015 expenditure per programme and strategic objective
•
SO1
SO2
SO3
SO4
General office
overheads
Employee Costs
Grand Total
as % of total
259 174
96 537
2 857
605 640
11 530
118 287
4 588 111
604 229
958 287
49 470
2 922 509
217 860
6 771 115
7 953 181
2 433 655
7 505 315
14 656 899
2 135 191
22 084 521
28 754 206
15%
29%
56%
874 933
1 173 111
52 326
8 116 260
% of total
Strategic
objective
Column Labels
COMMISSIONERS: CORPORATE SERVICE
Grand Total
GOVERNANCE &
SUPPORT
DELIVERY
SUPPORT
SERVICES
PROGRAM
•
2%
2%
0%
16%
•
4 786 706
9%
36 360 951
71%
51 364 287 100%
•
80% of costs
relatively fixed –
COE and office
overheads
20% direct to
specific APP
activities
The main service
delivery programme
accounts for most of
spending ( 56%)
100%
7
Compensation Depreciation Goods &
of Employees &
Services
Amortisation
COMMISSIONERS:
GOVERNANCE &
SUPPORT
CORPORATE
SUPPORT SERVICES
SERVICE DELIVERY
PROGRAM
Grand Total
Head Office
Provincial Office
Grand Total
6 771 115
7 537 509
22 308 348
36 616 971
Grand Total
Head Average
Count cumulative
cost per head
1 182 067
7 953 181
14
483 651
534 094
6 585 296
14 656 899
23
327 718
534 094
6 445 858
14 213 221
28 754 206
51 364 287
64
101
348 568
362 544
Compensation Depreciation Goods &
Grand Total Head Average
Count cum ulative
of Employees &
Services
cost per head
Amortisation
23 022 199
534 094 11 318 182
34 874 475
56
411 111
13 594 773
2 895 039
16 489 812
45
302 106
36 616 971
534 094 14 213 221
51 364 287
101
362 544
By extrapolation the average annual COE per head amounts to :
R
Average total expenditure per province
R 1 832 201
483 392
•
•
•
32% of total
expenditure was
incurred in provinces
(R16, 5 m)
It takes a monthly
average of R203k to
operate a provincial
office where R167k
thereof is COE
average
Provincial expenses
are COE- intensive
(82%) whilst HQ is
66% . COE intensity
implies less overheads
in relative terms
•
Provincial offices are
main service delivery
outlets
8
SO1 – Enabling Legislative environment
Sub-strategies
1. To monitor equality and evaluate the
promotion of gender equality and relevant
policies and practices of the public and private
sector and report parliament
2. To initiate and/or participate in the review of
the legislative framework in all spheres of
government that impact on gender equality
3. To conduct performance assessments of
political parties and the public and private
sectors on the effective implementation of
gender equality legislation policies and
practices
4. To evaluate the implementation and
effectiveness of national justice facilities in
addressing gender discrimination.
5. To convene policy dialogues with relevant
policy makers at national and provincial level
on recommendations to promote gender
equality contained in research reports and
research activities
Grand Total
Annual budget YTD
for SubSpending
programme
% of YTD YTD Actual Allocated
spending direct goods COE (YTD)
& services
5 406 938
3 720 114
69%
921 756
647 421
70%
250 849
-
Allocated
overheads
(YTD)
3 058 898
410 367
571 074
76 347
•
•
•
355 439
341 355
96%
298 249
24 019
19 087
470 878
305 399
65%
29 188
238 037
38 174
1 259 914
8 414 925
1 056 226
84%
72%
296 647
874 933
654 602
4 546 629
104 978
648 952
6 070 515
Spending
consistent with
APP roll out – no
material deviation
from Plan
Efficiency gains on
travel related
expenditure were
realised
Litigation on the
Univen matter
contributed to the
higher than
budget spending
on SO1-3
9
SO2 – Promotion and protection of gender rights
Sub-strategies
1. To timeously investigate complaints of
violations of gender rights and identify
appropriate re-dress
2. Initiate an investigation into systemic
violations of gender rights and identify
remedial action.
3. To develop co-ordinated programme to
promote gender equality
4. To initiate interventions for the sustainable
development and promotion of gender
equality by addressing violations in the social
cultural political economic security and human
rights dimensions
5. To collaborate with organs of state civil
society and other institutions for the effective
development protection promotion and
attainment of gender equality
Grand Total
YTD
Annual budget Spending
for Subprogramme
% of YTD
spending YTD Actual
direct goods Allocated
& services COE (YTD)
Allocated
overheads
(YTD)
5 159 429
3 895 383
76%
750 160
2 724 358
420 865
11 609 229
8 055 998
69%
19 783
7 091 416
944 798
2 457 195
2 985 796
122%
195 270
2 695 093
95 434
630 000
503 953
80%
106 054
397 899
-
1 532 634
21 388 487
1 532 577
100%
79%
101 844
1 173 111
16 973 706
1 316 212 114 521
14 224 977 1 575 618
•
This SO is activity
-intensive and
also involves the
use of multidisciplinary
teams in
execution
•
Consistent with
the actual APP
activities,
spending
deviations within
the acceptable
bounds
10
SO3 – Monitoring of compliance to treaties
Sub-strategies
1. To conduct annual reviews and audits of
state compliance with obligations under the
conventions covenants and charters and to
report on a regular basis to Parliament and the
Office of the Speaker of Parliament
2. To interact with and present reports to
national regional and international bodies on
state compliance with conventions covenants
and charters acceded to or ratified make
recommendations for improvements and
monitor implementation
Grand Total
Annual budget YTD
for SubSpending
programme
% of YTD YTD Actual Allocated Allocated
spending direct goods COE (YTD) overheads
& services
(YTD)
3 568 339
1 571 756
227%
15 918 3 476 074
76 347
37%
58%
36 409 3 546 018 1 049 776
52 326 7 022 092 1 126 123
4 632 202
12 499 143
14 070 899
8 200 542
• Activities on SO are
saturated in q4 in terms
of the annual plan hence
YTD spending lags the
annual budget at 58%
• AGDI project delays also
contributed. Catch up set
for Q4 therefore no
deviation is anticipated
• Spending and
completion of APP
activities to be achieved
by end of Quarter 4
11
SO4 – Effective and efficient administration
Sub-strategies
1. To maintain optimal governance and
oversight structures and policies between
Commissioners and the Secretariat.
2. To maintain the financial management
strategy so that it promotes effective efficient
and economic utilisation of resources as well as
accountability.
3. To develop and maintain an IT infrastructure
that supports and promotes the organisational
objectives of the CGE
4. To develop and implement comprehensive
HR policies procedures and practices
5. Review the communications strategy and
policy that promotes and enhances a positive
public image of the CGE
Grand Total
Annual budget YTD
for SubSpending
programme
% of YTD YTD Actual Allocated Allocated
spending direct goods COE (YTD) overheads
& services
(YTD)
•
7 117 217
10 082 784
71%
1 451 289
5 057 149
608 779
5 650 582
•
7 435 246
76%
2 136 353
3 088 247
425 982
84%
1 163 712
751 363
116 179
55%
1 070 185
759 885
154 107
2 031 254
2 404 194
1 984 178
3 582 369
3 336 293
2 309 062
25 813 655
20 119 524
144%
78%
ITC and
Communications
spending activities
included those
funded by
respectively
conditional grant
from NT and
Donation in kind
from the SABC
HR lagging due to
rescheduling of
training into the 4th
quarter due to
calendar challenges
to synchronise with
service providers (
most in particular;
the School of
Government) +
delays in projects
such as business
model review
2 294 721
910 609
130 964
8 116 260 10 567 253 1 436 012
12
2015
Statement of Financial Position as at 31 December 2015
Notes2015
R
ASSETS
2014
R
Restated
Current assets
Cash and cash equivalents
8 172 944
Receivables from non-exchange transactions
20 029
12 446 832
8 192 973
12 490 982
6 454 457
750 662
4 935 477
307 924
7 205 119
5 243 401
15 398 092
17 734 383
44 150
Non-current assets
Property, plant and equipment
Intangible assets
Total Assets
LIABILITIES
Current liabilities
Payables from exchange transactions
665 330
3 417 086
5 593 829
1 195 004
4 721 433
5 517 666
9 676 246
11 434 103
Total liabilities
9 676 246
11 434 103
Net assets
5 721 846
6 300 280
Payables from non-exchange transactions
Provisions
Liquidity
Cash ratio
Current ratio
Average spending on
goods & services
Exchange transactions
Creditors's balance
Creditors payment
period in days
NAV to total liabilities
Accumulated surplus
5 721 846
6 300 280
Total Net Assets
5 721 846
6 300 280
84%
85%
109%
109%
R 14 502 105 R 16 047 635
R 665 330 R 1 195 004
17
27
159%
155%
59%
55%
Solvency
Assets to Liabilities
NET ASSETS
2014
13
Cash Flow Statement for the 9 months period ended 31 December 2015
Dec-15
Dec-14
CASH FLOWS FROM OPERATING ACTIVITIES
Cash receipts from stakeholders
Grants
Interest received
Sundry income
Cash paid to stakeholders
Payment to employees and suppliers
Interest paid
Net cash flows from operating activities
R 51 290 093
50 769 000
449 778
71 315
R 51 309 731
50 427 000
861 670
21 061
(52 788 515)
(52 788 204)
(311)
(53 773 480)
(51 946 758)
(1 826 722)
(1 498 422)
(2 463 749)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property, plant and equipment
(2 775 466)
(4 454 416)
Net cash flows from investing activities
(2 775 466)
(4 454 416)
(4 273 888)
(6 918 165)
12 446 832
8 172 944
19 364 997
12 446 832
Net increase in net cash and cash
equivalents
Net cash and cash equivalents at the beginning
of year
Net cash and cash equivalents at end of year
-Inflows and outflows from
operating activities remain
constant between
comparative periods
-R7 million invested into
PPE over the past 12 to 18
months period
-Cash held reducing over
time and anticipated to be
under pressure over the
next 12 months period.
14
Corporate Services overview
• Supply Chain Management
• Fleet Management
• Facilities and office accommodation
15
SCM – Demand Management
• Supplier database – New circular from National Treasury re- Centralised
Supplier Database effective from 1 April 2016. Transitional activities
must be undertaken during 4th quarter.
• Additional needs identified includes material and training manual
(content) development for PEI by third party provider. Specifications in
this regard were compiled for sourcing during Q4.
• As part of the aggregate procurement plan for the year, the
procurement of copier machines is still pending the decision by NT
(office of the Procurement Officer) on a transversal contract, therefore
current lease is operative on a yearly extended basis ( compliant with
guidelines/instruction notes)
• Demand planning activities for new year will take place alongside the
APP planning cycle activities
16
SCM – Acquisition Management
• New travel agency was awarded a three year contract during December
2015 to commence operations from 1 January 2016. Previous contract
formally lapsed and the change over to new provider occurred with
success/no exception or challenge. Final but insignificant settlement of
the latter’s outstanding accounts during Jan to Feb 2016 due to time
lags due to commercial practice ( Agent awaits billing from providers
before invoice made out to CGE).
• There has not been any deviations recorded for the acquisition on any
goods and services during this quarter.
• No irregular expenditure, whatsoever was identified/recorded during
the period to 31 December 2015.
17
SCM – Performance Management
• Contract register reviewed during the quarter under review.
Corrective action taken on all anomalies ; not only ensure
compliance but effective contract management for the effective
performance of the CGE business
• An offer from a winning bid (for the supply of laptops) was
terminated because the provider could not deliver according to
the bid specifications. A new RFQ was issued, adjudicated and
delivery taken in January/February 2016. Therefore performance
on all IT project related supplier contracts is fulfilled in line with
contractual obligations and corresponding performance standards
18
SCM – Disposal Management
•
•
•
•
HQ old, scrap and technologically obsolete assets were disposed at gross
proceeds of R11, 000
Disposals for items held in provincial offices will be dealt with by provinces
directly in consultation with the Disposal Committee of the CGE. The
processes are underway for completion by 29 February 2016.
The second phase for the disposal of IT equipment is currently underway
where the method of disposal is through donations to institutions of
learning (in line with CGE policy and National Treasury Regulations). The
beneficiaries are been identified amongst local stakeholders for ratification
by Committee and approval by CEO by the first week of March 2016.
In terms of the schedule, all assets eligible for disposal shall be cleared
from the fixed assets register by close of the financial year (at reporting
date)
19
SCM – Logistics Management….1
• Fleet management – concerns remain around the effectiveness of
management enforcement of controls. The issue of consequence
management highlighted to responsible line managers and PC’s. There
are specific investigations into incidents that resulted in dents for two
provincial vehicles:
– Limpopo
– Pretoria
• Tracking system will be upgraded to include functionalities that could
assist fleet management controls (such as history on
driving/behaviour/speed, e.t.c)
• Assets management – A physical verification of all CGE assets
commences effective from week ending 12 February 2016 and shall
carry over the end of the month.
20
SCM – Logistics Management….2
Office Accommodation:
• The Eastern Cape and Pretoria offices are destined to change premises by
the beginning of the new financial year(1 April 2016).
– Floor plans discussed with owners/lessors and agreed for development already
– Branding of offices and IT cabling discussed and planned into the logistics
• A proposal from the Free State office to move floor to the ground level is
being evaluated ( Cost and benefit analysis). The proposal promises to
improve accessibility by public.
• Still awaiting NDPW on developments regarding the HQ procurement
instruction. The office lease was extended for 18 months since April 2015 to
cover the period of procurement. The schedule overrun will be followed
through during the quarterly bilateral meeting with NDPW’s Key Account
Management to held in March 2016.
21
Fleet utilisation and cost summary analysis
3 months to December 2015
Cost Centre
Eastern Cape
Free State
Gauteng
Head Office
KZN
Limpopo
Mpumalanga
North West
Northern Cape
Western Cape
Grand Total
Number Total cost
for the
of
vehicles Quarter
2 12 638.65
2 14 421.29
8 348.37
2
4 23 853.74
6 412.96
2
8 752.78
2
2 11 491.70
8 472.22
2
3 083.39
2
2 21 421.19
22 118 896.29
Cost per
Total
kilometres kilometre
travelled per
vehicle
0.74
8 591
1.09
6 615
0.59
7 021
0.58
10 304
0.96
3 356
0.68
6 393
0.88
6 548
0.89
4 768
0.58
2 677
1.48
7 244
0.85
63 517
• Eastern Cape, Free state and
Western Cape spending higher
than average mainly due to
expenses incurred for
maintenance & repairs to old
fleet. The old fleet is been
assessed for layoff/disposal
since its retention appears
uneconomic and cost
ineffective.
• It costs on average R5,400 per
quarter to run and maintain a
vehicle without taking
depreciation expense into
account
•
Fleet expenditure quarterly summary December 2015.xlsx
22
2015/2016 Year end planning
• Section 40 and 55 reporting period – 31 May 2016 PFMA
submission due date on AFS and Pre-determined objectives.
• Plans for audit readiness in place - Audit by AGSA to
commence by 2 May 2016 in terms of the signed engagement
letter. The budget and schedule was duly approved by the
Audit committee
• Currently underway is the IS audit co-sourced with internal
audit of the CGE. A determination will be made by AGSA if
reliance will be placed on this work, thus if in favour, extra
costs, time and effort could be avoided/saved.
23
Audit Action plans
• The implementation of the recommendation by the AGSA and
the CGE internal auditors progressing according to
commitments made without any material deviation.
–
–
–
–
–
–
SCM compliance with prescripts
ICT environment weaknesses
Human Resources Management
Performance information reporting (s40)
Financial Statements (s40)
General internal control systems
24
Audit Action plans – implementation
status
Focus area
Number Complete
of findings
Partially No
%
Complete Progress complete
SCM
Human
Resources
General internal
Control systems
Information
Technology
Performance
Information
Payments
Reporting - AFS
17
13
5
5
10
8
9
8
5
1
6
5
Totals
53
4
45
76%
-
100%
2
-
80%
1
-
89%
1
-
100%
0%
100%
8
-
85%
-
-
6
-
-
• All specific individual
issues corrected
• Structural/systemic
weaknesses addressed
to stem recurrence.
Internal controls
developed and/or
heightened as the case
may be
• Progress reviewed and
assured by internal
audit
•
AGSA follow-up tracking document
- February 2016.xls
25
Risk Management
• Identified risk treatment plans are implemented by Management and
subjected to oversight by all governance Committees
• Notable actions implemented includes
– Physical security – Biometrics access devise , smoke detector and
alarm installed in the server rooms at head office
– Staffing – critical positions filled (FS)
– Budget – mitigated through cost control and expenditure management
• Emerging risks
– None, whatsoever identified during period under review and/or any
reassessment on existing risks was considered to adversely impacting
the achievement of any objectives of the organisation.
•
Risk Assesment report- financial period to January 2016.pdf
26
Contingencies, fraud and Litigations
• Receivables – CGE v Gasa case – impairment and/or
recoverability assessment to be made before the end of the
financial year. High dependency on the Good Governance and
social ethics committee.
• Contingent liability -Axolute v CGE – matter resolved and will
not impact financial statements anymore.
• Management is not aware of any actual or potential
fraudulent activities, whatsoever. No report in this regard was
made to management during the period under review.
27
Thank You
HAVE A GENDER RELATED COMPLAINT ????
REPORT IT TO
0800 007 709
Twitter Handle @CGEinfo
Facebook: Gender Commission of South Africa
28