annual report 2014/2015 vote 2 - provincial government · 2016-06-07 · 6 mpumalanga provincial...

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Annual Report

2014/2015

Vote 2

MPUMALANGA PROVINCIAL LEGISLATURE

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2Mpumalanga Provincial Legislature Annual Report 2014/2015

Hon. B.T. Shongwe,

Speaker: Mpumalanga Provincial Legislature

I have the honour of submitting the Annual Report of the Mpumalanga Provincial Legislature for the period 1 April 2014 to 31 March 2015.

Mr. L.J. Mwale

Secretary: Mpumalanga Provincial Legislature

31 August 2015

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1. Part One : General Information ............................................4

2. Part Two: Performance Information ..................................23

3. Part Three: Governance .....................................................85

4. Part Four: Human Resource Management ........................102

5. Part Five: Financial Information .........................................132

Table of contents

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Part OneGeneral Information

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Contact details for the Mpumalanga Provincial Legislature

Physical Address

Mpumalanga Provincial Legislature

Building no.1

Government Boulevard

Legislature and Government Complex

Riverside Park Extension 2

MBOMBELA,

1200

Postal Address

P/ Bag X 11289

MBOMBELA,

1200

Contact telephone number

Tel No. 0860 744 455/ 013 766 1167

Website and e-mail addresses

www.mpuleg.gov.za

[email protected]

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List of Acronyms

AC Audit Committee IT Information Technology

AIDS Acquired Immune Defi ciency

Syndrome

KM Knowledge Management

AG Auditor General LRA Labour Relations ActAGSA Auditor-General South Africa LSB Legislature Service BoardAPP Annual Performance Plan MOV Mode of Verifi cationATC Announcements, Tabling and

Committee Reports

MPL Members of the Provincial Legislature

EAP Employee Assistance

Programme

MTEF Medium Term Expenditure Framework

EDMS Electronic Document

Management System

NCOP National Council of Provinces

ERP Enterprise Resource Planning OHS Occupational Health and SafetyFMMPLA Financial Management of

Mpumalanga Provincial

Legislature Act

PPM&E Planning, Performance Monitoring & Evaluation

FMPPLA Financial Management of

Parliament and Provincial

Legislatures Act

SAP Systems Application & Products

GRAP Generally Recognised

Accounting Practice

SCM Supply Chain Management

HCM Human Capital Management SCOPA Standing Committee on Public AccountsHIV Human Immunodefi ciency Virus SMS Senior Management ServiceHon. Honourable SOM Sector Oversight ModelHR Human Resources SOPA State of the Province Address

TLP Taking the Legislature to the People

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STRATEGIC OVERVIEW

Vision

A people-centred, African world class Legislature

Mission

To hold the Executive and other state organs accountable through intensifi ed oversight, enhanced public involvement and effective law making supported by professional administrative service

Values

• Adaptability: Flexibility in responding to new circumstances;

• Co-operation: Commitment to working with both internal and external stakeholders;

• Customer orientation: Placing customers fi rst;

• Economy: Cost-effective usage of resources;

• Excellence: Continuous improvement of performance standards;

• Fairness: Acting in a fair, balanced and considered manner at all times;

• Integrity: Acting with integrity at all times, and being exemplary;

• Openness: Transparency and accessibility;

• Participation: All processes of the Legislature to be people-centre; and

• Quality orientation: Commitment to focusing on quality and meeting world-class standards.

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Strategic Outcome-oriented Goals

• Hold the executive accountable in respect of the fi ve government priorities over the next fi ve (5) years;

• Improve public involvement, especially that of the poor, marginalised and disadvantaged members of the public in the legislative processes by 2015;

• Entrench effectiveness of legislation for the people of the province by 2015;

• Improve the capacity of the Legislature to conduct its oversight and public participation functions through strengthened internal business processes over the next fi ve (5) years;

• Improve the integrity and image of the Mpumalanga government through effective oversight of corporate and fi nancial governance by 2015;

• Promote the implementation of the nation-building programme of government and the Legislature to improve social cohesion in the province by 2015; and

• Strengthen participation in inter-parliamentary bodies for improving participatory democracy and co-operation in the next fi ve (5) years.

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Legislative and Other Mandates

The principal Acts that guide the Mpumalanga Provincial Legislature are as follows:

The Constitution of the Republic of South Africa Act, 1996 (Act No. 108 of 1996) seeks to introduce a new Constitution for the Republic of South Africa and to provide for matters incidental thereto. It is the supreme law of the land and the Legislature must ensure that its operations are in line with the Constitution.

The Mpumalanga Provincial Legislature Services and Administration Act, 2006 (Act No. 7 of 2006) which seeks to provide for the management and administration of the Legislature, as well as conditions of employment and other matters incidental thereto. The Legislature must ensure that its operations are in line with this Act.

The Public Finance Management Act, 1999 (Act No. 1 of 1999) which seeks to regulate fi nancial management in the national government and provincial governments. The applicability of this Act to the Legislature is subject to Chapter 1, Section 3 (2) (b).

Basic Conditions of Employment Act, 1997 (Act No. 75 of 1997) which seeks to advance economic de-velopment and social justice by giving effect to the right to fair labour practices conferred by section 23 (1) of the Constitution. The Legislature has a responsibility to adhere to this Act as it performs its operations.

Labour Relations Act, 1995 (Act No. 66 of 1995) which seeks to give effect to and regulate the fundamental rights conferred by section 27 of the Constitution. The Legislature has a responsibility to adhere to this Act as it performs its operations.

Employment Equity Act, 1998 (Act No. 55 of 1998) which seeks to provide for employment equity and to provide for matters incidental thereto. The Legislature has a responsibility to adhere to this Act as it performs its operations.

Preferential Procurement Policy Framework Act, 2000 (Act No. 5 of 2000) which seeks to give effect to section 217(3) of the Constitution by providing a framework for the implementation of the procurement policy contemplated in section 217(2) of the Constitution and to provide for matters connected therewith. The Legislature has a responsibility to adhere to this Act as it performs its operations.

Broad-Based Black Economic Empowerment Act, 2003 (Act No. 53 of 2003) seeks to mainly establish a legislative framework for the promotion of black economic empowerment as well as empowering the Minister to issue codes of good practice and to publish transformation charters. It also provides for matters connected therewith. The Legislature has a responsibility to adhere to this Act as it performs its operations.

Promotion of Access to Information Act, 2000 (Act No. 2 of 2000) which seeks to give effect to the constitutional right of access to any information held by the State and any information that is held by another person and that is required for the exercise or protection of any right, and to provide for matters connected therewith. The Legislature has a responsibility to adhere to this Act as it performs its operations.

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Hig

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1During the period under review, the acting Secretary to the Legislature was Mr. JB Silinda; Mr. P Thwala was the acting Executive Manager for Parliamentary Business and Mr. SS Sanyane was the Executive Manager: Financial Management

Cha

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Hon

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Ms.

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Secr

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Mr L

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Hon

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Ms.

M.B

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Ms

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Mr.

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Ris

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Mr.

D. M

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It is my great pleasure to present the Annual Report of the Mpumalanga Provincial Legislature for the period spanning 1 April 2014 to 31 March 2015. This report represents a transition in the reporting cycle between the Fourth Legislature and the Fifth Legislature which was occasioned by the 2014 general elections. The 2014/15 Annual Report therefore refl ects the extent to which the last Annual Performance Plan (APP) of the Fourth Legislature was implemented in order to achieve the political and strategic priorities refl ected in the Five-year Strategic Plan covering the 2009/10 to 2014/15 fi nancial years.

We are delighted to announce that in July this year, we appointed Mr Linda Mwale as the new Secretary to the Mpumalanga Provincial Legislature after the position became vacant for some time. We congratulate Mr Mwale and wish him well in this position of responsibility.

It is with a source of pride and honour to report that during the 2014/15 fi nancial year, the Mpumalanga Provincial Legislature has once again received from the Auditor - General of South Africa, an unqualifi ed audit opinion. Whilst we accept this highlighted audit opinion, the Legislature will continue to strive with unfl inching commitment for the achievement of the clean audit outcome in the forthcoming years. However, we are equally pleased that the Legislature was able to achieve the majority of its planned performance targets and that there were no material fi ndings on the usefulness and reliability of the reported performance information during the period under review.

As contained in the body of this report, the Legislature made signifi cant advances towards the achievement and the realisation of its policy imperatives and goals. The Legislature ensured that the fulfi lment of the constitutional mandate remained at the epicentre of our collective institutional efforts as we seek to move our province and country forward. It excised its oversight function by holding the provincial departments and their associated organs of state accountable. The Legislature also developed and implemented its focused programme of public participation and involvement. Some of the programmes we embarked upon included, public hearings; sectoral parliaments; nation building legacy projects; taking of the Legislature to the people events; and the processing of petitions from the members of the communities. As part of its law making function, the Legislature also considered several progressive pieces of legislation which were passed during 2014/15 fi nancial year. We believe that through the articulated endeavours emanating from the execution of our constitutional obligations, the Legislature certainly contributed in the collective task of improving the quality of life of our people during the period under review.

We are cognisant of the fact that the achievements and milestones we recorded during the 2014/15 fi nancial year became possible through the combined efforts of the Legislature fraternity as a whole. It is against this backdrop that we owe a debt of gratitude to the Members of the Mpumalanga Provincial Legislature for their individual and collective contribution in ensuring that the Legislature continued to fulfi l its constitutional obligations. Words of profound appreciation also go to all the employees of the Legislature for their support during the period under review. We are also grateful to all our strategic partners and members of the public for their cooperation and support. In the course of the Fifth Legislature, let us all work together in ensuring that our institution stays on the path of progress and success in fulfi lling our constitutional mandate and striving towards a people-centered African world class Legislature.

Mrs B.T. Shongwe (MPL)

Speaker: Mpumalanga Provincial Legislature

towards a people-centered African world class Legislature.

Mrs B.T. Shongwe (MPL)

Foreword by the Speaker

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Report of the Accounting Offi cer

1. Future plans and actions

The Mpumalanga Provincial Legislature has prepared detailed plans for the 2015/16 MTEF period in line with the Five-Year Strategic Plan. The annual performance plan is reviewed annually together with the indicative budget allocations.

The plans are supported by the indicative budget allocations as stated on the table below:

2015/2016 MTEF Budget Plans

Outcome Audited outcomes Medium-term estimates

2013/14 2014/15 2015/16 2016/17 2017/18

Programmes R’000 R’000 R’000 R’000 R’000

Administration 111,125 135 335 128,291 135,937 144,445

Parliamentary Business 139,752 155 786 166,662 162,423 168,316

Total payments 250,877 291 121 294,953 298,360 312,761

Economic Classifi cation

Compensation of employees 101,616 115 908 143,563 150,286 161,657

Goods and services 110,798 121 013 98,717 105,744 106,658

Transfers to political parties 37,149 38 068 51,493 40,954 43,002

Payments for capital assets 1,314 16 132 1,180 1,376 1,445

Total Payments 250,877 291 121 294,953 298,360 312,762

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The following broad assumptions are the foundation on which the budget of the Legislature is allocated:

Statutory allocation for remuneration of Members of the Provincial Legislature;

Political Party funding for caucus, constituency and the once-off enhancement of democracy funding;

Opening of the Legislature and hosting of the State of the Province Address;

Hosting of two (2) Taking the Legislature to the People projects;

Research support and Committee coordination work for Portfolio and Select Committees of the Legislature;

Hosting of Sectoral Parliaments focusing on the following sector: workers, youth, children, women, religion, senior citizens and people with disabilities;

Public hearings and oversight visits by Committee of the Legislature;

Implementation of the Public Participation Programme;

The maintenance, support and licensing of computer systems, IT infrastructure and networks; and

Revamping of the Chamber system.

Percentage allocation by Programme: 2015/2016

2014/15 Annual Performance Report Page 14

Statutory allocation for remuneration of Members of the Provincial Legislature; Political Party funding for caucus, constituency and the once-off enhancement of democracy funding; Opening of the Legislature and hosting of the State of the Province Address; Hosting of two (2) “Taking the Legislature to the People” projects; Research support and Committee coordination work for Portfolio and Select Committees of the Legislature; Hosting of Sectorial Parliaments focusing on the following sector: workers, youth, children, women, religion, senior citizens and people

with disabilities; Public hearings and oversight visits by Committee of the Legislature; Implementation of the Public Participation Programme; The maintenance, support and licensing of computer systems, IT infrastructure and networks; and Revamping of the Chamber system.

Percentage allocation by Programme: 2015/2016

Forty-three percent (43%) of the budget for the 2015/2016 financial year is allocated to Programme 1 (Administration) and fifty-seven 57% is allocated to Programme 2 (Parliamentary Business). Due to the limited funding, a number of activities could not be funded in this MTEF allocation and these shortfalls include work on ERP upgrade and maintenance, the parliamentary village, performance monitoring and evaluation system, building maintenance, maintenance of the chamber and committee room systems and enhancement of public participation.

43%

57% Administration Parliamentary Business

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Forty-three percent (43%) of the budget for the 2015/2016 fi nancial year is allocated to Programme 1 (Administration) and fi fty-seven 57% is allocated to Programme 2 (Parliamentary Business).

Due to the limited funding, a number of activities could not be funded in this MTEF allocation and these shortfalls include work on ERP upgrade and maintenance, the parliamentary village, performance monitoring and evaluation system, building maintenance, maintenance of the chamber and committee room systems and enhancement of public participation.

The Legislature implemented cost saving measures and allocated the limited funding with the aim of directing budgets towards the work of parliamentary committees. In line with the Oversight Model of the South African Legislative Sector, the Legislature has adopted its own model that will guide how the committees should undertake their oversight function.

2. General review

This Annual Report highlights the performance of the Legislature as per the Annual Performance Plan for the 2014/15 fi nancial year. The report indicates that the Legislature has achieved most of its planned targets during the period under review and shows an improvement from the previous reporting period. In the isolated cases where targets have not been achieved, reasons have been provided in the report.

The Legislature remained committed to maintaining high standards of good governance. The established governance structures continued to be functional during the reporting period, to improve fi nancial and non-fi nancial performance of the Legislature. However there were instances of inappropriateness which required further understanding of some transactions incurred in the year. These transactions have led to investigations which commenced after year end to facilitate the appropriate remedial actions to be taken.

During the course of the 2014/15 fi nancial year, numerous targeted projects and events were undertaken to fulfi l and achieve the constitutional mandate and the vision of the Legislature respectively. These included:

Development of the Five-Year Strategic Plan and annual performance plan of the Legislature; Seven Sectoral Parliaments; Two (2) Taking the Legislature to the People projects; Twenty four (24) Sittings of the House; Passed four (4) pieces of Legislation and also 173 petitions; Opening of the 5th Legislature; State of the Province Address; Six (6) legacy projects; Three (3) Legislature colloquia; and Risk awareness and assessment workshops.

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3. General review of the state of fi nancial affairs

The Legislature spent an amount of R288.670 million, i.e. 99.2% of a total budget of R291 121 million during the 2014/15 fi nancial year. This spending trend is consistent with that of the previous fi nancial year which was 99.8%. All the programmes and items also consistently spend above 90%, accept for capital assets at 28.7%, while the goods and services budget shows an overspending at 107.7%. The reasons for these deviations and corrective measures are explained below.

Programme spending: 2014/2015 and 2013/2014

Programme Final appropriation

Amount spent

Variance %Spent %Spent

2014/15 2014/15 2014/15 2014/15 2013/2014R’000 R’000 R’000 % %

Programme 1: Administration 135 335 133 133 2 202 98.4% 100%Programme 2: Parliamentary Business 155 786 155 537 249 99.8% 99.6%Total 291 121 288 670 2 451 99.2% 99.8%

Economic classifi cation percentage spending: 2014/2015 and 2013/2014

Economic classifi cation Final appropriation

Amount spent

Variance %Spent %Spent

2014/15 2014/15 2014/15 2014/15 2013/2014R’000 R’000 R’000 % %

Compensation of employees 115 908 115 908 0 100% 99.5%Goods and services 121 013 130 287 (9 274) 107.7% 101.6%Transfers and subsidies 38 068 37 819 249 99.3% 100%Capital assets 16 132 4 656 11 476 28.7% 42.8%Total 291 121 288 670 2 451 99.2% 99.8%

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Programme performance

Programme 1: Administration

Adjusted Budget

Post Adjustments

Final Budget

Actual at the end

of March 2015

Outcome as %

Budget

(over)/under-spending

R’000 R’000 R’000 R’000 % R’000Programme 1: AdministrationSub-programmeOffi ce of the Speaker 10 507 (504) 10 003 10 003 100,0% -Offi ce of the Secretary

15 071 (2 304) 12 767 12 767 100,0% -

Corporate Services 91 147 2 341 93 488 91 286 97,6% 2 202Financial Management

19 690 (613) 19 077 19 077 100,0% -

Total 136 415 (1 080) 135 335 133 133 98,4% 2 202Economic classifi cationCompensation of employees

56 751 (6 360) 50 391 50 391 100,0% -

Goods and services 63 868 4 944 68 812 78 086 113,5% (9 274)Payments for capital assets

15 796 336 16 132 4 656 28,9% 11 476

Total 136 415 (1 080) 135 335 133 133 98,4% 2 202

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Programme 2: Parliamentary Business

Adjusted Budget

Post Adjustments

Final Budget

Actual at the end

of March 2015

Outcome as %

Budget

(over)/under-spending

R’000 R’000 R’000 R’000 % R’000Programme 2: Parliamentary BusinessSub-programmeLaw Making 31 466 (376) 31 090 31 090 100,0% -Oversight 35 601 (4 876) 30 725 30 725 100,0% -Public Participation 17 913 (91) 17 822 17 822 100,0% -Members Facilities 65 543 6 498 72 041 71 792 99,7% 249Corporate Gover-nance

4 183 (75) 4 108 4 108 100,0% -

Total 154 706 1 080 155 786 155 537 99,8% 249Economic classifi cationCompensation of employees

67 461 (1 944) 65 517 65 517 100,0% -

Goods and services 49 177 3 024 52 201 52 201 100,0% -Total transfers and subsidies

38 068 - 38 068 37 819 99,3% 249

Payments for capital assets

15 796 336 16 132 4 656 28,9%

Total 154 706 1 080 155 786 155 537 99,8% 249

The above tables illustrate the budget and expenditure outcomes on a cash basis as the budget is allocated on the cash basis. The difference between the expenditure reported above the annual fi nancial statements is because the expenditure reported in the fi nancial statements is on the accrual basis of accounting in line with the GRAP standards and is inclusive of non-cash items and exclusive of expenditure on acquisition of capital assets and inventory.

Goods and services

The over spending on goods and services is caused mainly by the accruals carried from the 2013/2014 fi nancial year. Under-funding of some contractual obligations for IT and general institutional services also contributed to this overspending.

The Legislature introduced cost containment measures and this is seen in the reduced accruals for the reporting period. The cost containment measures will continue in the next fi nancial years. Management will also continue to utilise the IYM system to monitor spending patterns.

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Capital assets

The under spending is due to funds allocated during the adjustment appropriation for the Chamber system. The funds were not utilised as the bid processes were fi nalised subsequent to year end.

The Legislature received donations amounting to R839 069 in the year under review and R250 000 of this amount was received in cash. The funds were utilised to support activities performed during the opening of the Legislature and State of the Province Address events. Other donations received in kind, estimated at R589 069 were also utilised to support the Legislature events.

Spending of allocated funding was driven by the strategic and political necessity to fulfi l the constitutional mandate of the Legislature which entails - law making, oversight, public participation and involvement. The following systems and processes were in place during the year under review to continuously address and improve fi nancial management:

Quarterly reporting and monitoring of fi nances through reports on key accounts on revenue, expenditure, assets and liabilities;

An action plan to address matters raised by the Auditor-General and regular monitoring of progress on the implementation of corrective measures;

A functional Internal Audit and Audit Committee; Risk Management function and Risk Management Committee; and Financial and other corporate governance policies, procedures and strategies.

The Legislature continued to implement processes and systems for prudent fi nancial management aimed at reducing accruals in the reporting period and also to ensure that wasteful spending is avoided. The cost containment measures were adopted and implemented in this regard and these will continue in the current fi nancial year. The results of these efforts are seen in the reduction of the accruals from R17.633 million to R7.595 million.

The revenue collected during the year amounted to R1.206 million against a target of R1.155 million. This represents over collection of 4.4% from the planned target. The over collection can be attributed to interest on bank balance, recoveries from debtors and donations received. It must however be noted that the Legislature does not have a robust revenue generation base due to the social nature of its operations which is in line with the constitutional mandate.

The retained income of R1.513 million from the 2013/14 fi nancial year revenue generation and unspent funds was re-appropriated in the reporting period. The funds were utilised to augment budgets for under-funded projects. The retained income realised from the reporting period, estimated at R3.657 million (2.451 million unspent appropriated funds and R1.206 million own generated revenue) is expected to be re-appropriated in the next fi nancial year.

The virements and shifting of funds between programmes and sub-programmes have been effected to defray overspending on sub programmes and main divisions. An amount of R1.080 million was thus shifted from Programme 2 to Programme 1 to defray overspending within Programme 1.

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No unauthorised expenditure was incurred in the year under review. An amount of R1.082 million incurred in the 2012/2013 fi nancial year, due to over spending on a main division was condoned during the reporting period.

No closing balances are reported on irregular expenditure for the reporting period. The carrying amounts from the previous fi nancial year were due to non-compliance with the SCM policy. These amounts were condoned during the reporting period.

Fruitless and wasteful expenditure incurred during the 2013/2014 fi nancial year were mainly due to non-compliance with procurement legislation, CCMA pay-out, vehicle accidents and “no show penalty charges”. A portion of this expenditure amounting to R2.579 million was condoned in the reporting period. The closing balance of R67 595 was due to a balance carried forward of R31 387 and an amount incurred during the year of R36 208.

Management will continuously monitor the implementation of fi nancial policies and procedures to ensure that procurement processes and regulations are followed and to avoid wasteful expenditure. The Internal Procedure Manual (ICP) has been reviewed to clearly outline processes to be followed for the speedy management and clearing of these accounts while avoidance of these expenditures is emphasised in this procedure manual. An SCM/Payment Compliance checklist was adopted to facilitate the screening of fi nancial transactions at the various processing stages.

4. Capacity constraints and challenges facing the Legislature

During the year under review, the Legislature continued to operate while some critical positions remained vacant. The vacancy rate as at 31 March 2015 stood at 18% from 24% in the previous reporting period. The Legislature managed to achieve most of its planned performance targets.

Emerging as a result of the introduction of the SAP fi nancial system and the transition from the cash basis to the accrual basis of accounting was the need for appropriately qualifi ed and experienced staff on the implementation of the standards of GRAP. To this end, expert services were sourced to support and capacitate the Legislature staff. Financial processes were streamlined and implementation will be monitored for further improvements. This work however, must continue in the next fi nancial year in order to align policies and procedures to the fi nancial management act which is envisaged to be effective as of the 1st of April 2015.

Other consulting services utilised during the year under review, included work on the facilitation of the development of the fi ve year strategic plan and annual performance plan, development of the human resource strategy, co-sourced internal audit function, IT support services; and the establishment of the disaster recovery site.

5. New or proposed activities

There were no new or proposed activities affecting the Provincial Legislature’s operations. Even though the migration from the cash basis to the accrual basis of accounting was introduced in the 2013/2014 fi nancial year, it is still work that requires continuous development and capacity building within the Legislature.

6. Supply chain management

No unsolicited bid proposals were concluded during the year under review. The following SCM systems and structures were in place:

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An SCM Policy

Asset Management Policy

Internal Control Procedure Manual

SCM Bid Committees

Management will build on the progress made to ensure compliance with GRAP for reporting on property plant and equipment in the coming year. The SCM Policy and Asset Management Policy will also be reviewed in the coming year to ensure alignment with the latest applicable fi nance act and regulations and the standards of GRAP.

7. Events after the reporting date

On events after the reporting date, the Legislature reports as follows:

The Legislature has awarded a bid for the improvement of the Chamber system subsequent to the reporting period. Delivery is expected to commence in the fi rst and second quarter of the 2015/16 fi nancial year. This system enhancement is expected to improve the work of Members during the Sittings of the House.

The Legislature further embarked on a process of investigation of certain transactions for further understanding and assurance that these were concluded appropriately for the necessary remedial measures to be implemented.

8. Others

Programme and budget structure

There were no changes on the Programme and Budget Structure in the year under review. The Legislature has aligned to the structure that was adopted by the Legislative Sector as of the 2013/2014 fi nancial year for budget, planning and reporting purposes.

Interim fi nancial statements

The interim fi nancial statements were prepared and reviewed by management and internal audit. These review processes were useful during the year under review and will also be pursued in the forthcoming years in order to further improve completeness and accuracy of fi nancial statements of the Legislature.

9. Acknowledgements and appreciation

The contribution made by management and staff of the Legislature, the Internal Audit function, Audit Committee and Auditor-General in the preparation of the annual report is hereby acknowledged.

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10. Conclusion

The Accounting Offi cer hereby commits to operating a clean administration by ensuring that relevant systems, processes and policies are implemented in ensuring enhanced accountability. The Accounting Offi cer is also of the view that based on information and explanations provided by management, the system of internal control provides reasonable assurance that the fi nancial and non-fi nancial information of the Legislature may be relied on for the preparation of the annual report. The fi nancial statements are prepared on the basis that the Legislature is a going concern and that there is neither the intention, nor need or legal requirement to discontinue or materially curtail the scale of the operations of the organisation.

11. Approval and sign off

The Annual Report of the Mpumalanga Provincial Legislature for the year ended 31 March 2015 is hereby approved by the Accounting Offi cer.

____________________

Mr. L.J. MWALE

SECRETARY TO THE LEGISLATURE

31 August 2015

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Mrs B.T. ShongweChairperson

Mr L.J. MwaleMember

Legislature Service Board

Mr B.D. DubeMember

Mr J.M. MkhatshwaMember

Mr A.M. BenadieMember

Mr C. MaunyeMember

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Part Two Performance Information

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2.1 Accounting Offi cer’s Statement of Responsibility for Performance Information

The Accounting Offi cer has prepared performance information for the year ended 31 March 2015 which-

• provides a record of the activities of the Legislature during the fi nancial year;

• provides a report on performance of the Legislature; and

• promotes accountability for decisions made during the year by the Legislature.

Furthermore, the annual report’s performance information is based on the APP and amongst other things contains:

• an assessment by the Accounting Offi cer of the performance of the Legislature during the fi nancial year against the strategic objectives and strategic outcome-oriented goals as identifi ed in the Legislature’s APP; and

• the Auditor-General’s audit report and the Audit Committee report which refl ect on performance information of the Legislature.

As refl ected in the details contained in part two of this annual report, the Accounting Offi cer has performed his responsibilities for performance information. It is the opinion of the Accounting Offi cer that the articulated performance information fairly represents the performance of the Mpumalanga Provincial Legislature for the fi nancial year ended 31 March 2015.

Mr. L.J. Mwale

Secretary to the Legislature

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2.2 Strategic outcome-oriented goals

• SOOG 1: Hold the executive accountable in respect of the fi ve government priorities over the next fi ve (5)years:

The strategic outcome-oriented goal acknowledges the need to further strengthen the oversight function and capacity of the Legislature in order to adequately respond to the new political mandate. The oversight of the executive constitutes the core business of the Legislature

• SOOG 2: Improve public involvement, especially that of the poor, marginalised and disadvantaged members of the public in the legislative processes by 2015:

The strategic outcome-oriented goal recognises the need to increase participation of the people in the legislative processes and other activities of the Legislature in order to deepen democracy. Public involvement constitutes the core business of the Legislature

• SOOG 3: Entrench effectiveness of legislation for the people of the province by 2015:

• The strategic outcome-oriented goal recognises the need to ensure effectiveness of legislation for the benefi t of the people of the province. Law-making is part of the core mandate of the Legislature

• SOOG 4: Improve the capacity of the Legislature to conduct its oversight and public participation functions through strengthened internal business processes over the next fi ve (5) years:

• Strengthened systems, processes and policies are necessary to ensure that the Legislature is adequately supported to enable it to effectively deliver on its constitutional mandate

• SOOG 5: Improve the integrity and image of the Mpumalanga government through effective oversight of corporate and fi nancial governance by 2015:

It is considered important for the Legislature as a public institution to use allocated resources effectively, effi ciently and economically, whilst also embracing and adhering to the principles of good corporate governance. In such a context, the integrity and image of the Legislature is likely to be improved in the hearts and minds of its internal and external stakeholders

• SOOG 6: Promote the implementation of the nation-building programme of government and the Legislature to improve social cohesion in the province by 2015:

In a society that is faced with many challenges, there is a need for institutions like the Legislature to remain sensitive and responsive to prevailing societal challenges. One of the ways of addressing this challenge is for the Legislature to contribute towards improving social cohesion in the province through implementing nation-building programme

• SOOG 7: Strengthen participation in inter-parliamentary bodies for improving participatory democracy and co-operation in the next fi ve (5) years:

In order for the Legislature to share experiences and learn from others regarding issues of parliamentary democracy and other related matters, there is a need for it to maintain and strengthen its relations with parliamentary bodies and parliaments in both local and international contexts

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2.3 Performance information2

The Legislature achieves the above-mentioned strategic outcome-oriented goals through the development of strategic objectives, performance target and programme performance indicators. In the legislative sector there are no customised performance indicators. The Legislature therefore has its own performance indicators that were incorporated in the APP which has informed this annual report. During the strategic planning sessions, the Legislature decided that it will not change planned targets for any of its programmes throughout the implementation of the APP. As a result, the targets were not changed during the fi nancial year under review.

2.4 Performance information by programme

The activities of the Mpumalanga Provincial Legislature are organised according to the following programmes:

• Programme 1: Administration

• Programme 2: Parliamentary Business

2.4.1 Strategic objectives, performance indicators, planned targets and actual achievements

The Legislature has developed the strategic outcome-oriented goals and strategic objectives as refl ected in the 2014/15 APP. It has also developed annual targets and indicators to ensure that the goals and objectives are achieved. During the period under review, the institution has achieved most of its planned targets which have contributed towards the continued fulfi lment of the constitutional mandate and the realisation of the vision of becoming a people-centred, African world class Legislature.

2 The numbering and sequence of the performance indicators in the annual report are based on the APP of the fi nancial year under review

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PROGRAMME 1 ADMINISTRATIONPurpose of the ProgrammeThe purpose of Programme 1 is to provide strategic leadership, management and administrative support to ensure institutional effectiveness and the achievement of the core business of the Legislature.

List of strategic objectives for Programme 1: Administration

1. Strengthen annually, the strategic and fi nancial management functions for enhanced divisional and institutional effectiveness by 2015

2. Ensure effective corporate and fi nancial governance for legislative compliance and improved institutional integrity and public confi dence by 2015

3. Monitor annually, the fulfi lment of the constitutional mandate, with special focus on effective oversight and public participation by 2015

4. Facilitate annually, the development, implementation and monitoring of legacy projects for nation-building over the next fi ve (5) years

5. Strengthen fi nancial management support in order to enhance the treasury function by 2015

6. Ensure annually, effective leadership, management and administration through institutional strategy, policies and systems over the next fi ve (5) years

7. Provide effective support for organisational strategy to achieve the vision and mandate of the Legislature

8. Provide internal audit service to improve the effectiveness of internal control processes and procedures of the Legislature by 2015

9. Provide risk management services to promote good corporate governance within the Legislature by 2015

10. Co-ordinate and monitor annually an effective implementation of the performance management system and policy to improve institutional performance and accountability by 2015

11. Facilitate and monitor annually the continuous improvement of employment relations in the Legislature by 2015

12. Develop human resources strategy and implement three (3) focus areas of the strategy annually over the next fi ve (5) years

13. Train and develop employees to increase their capacity to support the core business of the Legislature by 2015

14. Develop and implement annually, an effective wellness programme to enhance the wellbeing of Members and staff by 2015

15. Enhance and maintain electronic systems and infrastructure for effective support of the core business of the Legislature by 2015

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16. Profi le the Legislature to stakeholders to facilitate increased public awareness and public confi dence in the Legislature by 2015

17. Improve co-ordination and monitoring of institutional security services by 2015

18. Improve document management services in order to support the core business of the Legislature by 2015

19. Improve facility management services to enhance institutional effi ciency in order to support the core business of the Legislature by 2015

20. Promote compliance with relevant prescripts, governance practices and policies to obtain a clean audit opinion by 2015

21. Manage supply chain services effectively and effi ciently by 2015

22. Improve House proceedings and Hansard support for effective oversight and law-making functions of the Legislature by 2015

23. Improve parliamentary support for effective oversight and law-making functions of the Legislature

24. Improve research and policy analysis support for effective oversight and law-making functions of the Legislature

25. Improve legal support for effective law-making processes and practices of the Legislature by 2015

26. Strengthen support for corporate governance regarding legislative compliance and improved institutional integrity and public confi dence by 2015

27. Improve public education and involvement in Legislature processes to inspire public confi dence by 2015

28. Strengthen the management and administration of Members’ Affairs and transfers to Political Parties to improve the execution of the mandate of the Legislature by 2015

29. Improve protocol service to enhance institutional integrity and strengthen strategic relationships by 2015

30. Promote inter-parliamentary relations to strengthen strategic relationships for deepened parliamentary democracy by 2015

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1.1 Offi ce of the Speaker

The purpose is to provide political leadership, and management support to ensure effective functioning of the Legislature and the Offi ce of the Speaker respectively towards the fulfi lment of the constitutional mandate.

1.1.1 Chief of Staff

Pu rpose

The purpose is to provide effective and effi cient support to the Executive Authority, and to ensure that the strategic and fi nancial functions of the Division are executed.

List of strategic objectives for Chief of Staff

1. Strengthen annually, the strategic and fi nancial management functions for enhanced divisional and institutional effectiveness by 2015.

2. Ensure effective corporate and fi nancial governance for legislative compliance and improved institutional integrity and public confi dence by 2015.

1. Strategic Objective: Strengthen annually, the strategic and fi nancial management functions for enhanced divisional and institutional effectiveness by 2015

Actual performance against planned targets

Deviation from planned target to Actual Achievement 2014/2015

Comment on deviations

Programme Performance Indicator

Actual achievement 2013/14

Planned Target 2014/2015

Actual Achievement 2014/2015

1.1.1 Number and frequency of divisional performance reports compiled

Four (4) quarterly performance reports were compiled by the 10th day after the quarter

Four (4) quarterly and one (1) annual divisional employee performance reports compiled

Four (4) quarterly reports were compiled

None None

1.1.2 Time frame for the compilation of the annual performance report of the previous fi nancial year

One (1) quarterly divisional employee performance report was compiled

Annual divisional employee performance report was compiled

None None

1.2 Timeframe for the development, review and update of integrated divisional business process manual

- Integrated divisional business process manual developed

Integrated divisional business process manual was developed

None None

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2. Strategic Objective: Ensure effective corporate and fi nancial governance for legislative compliance and improved institutional integrity and public confi dence by 2015








2.1 Number and frequency of expenditure reports compiled

Four (4) quarterly expenditure reports were compiled by the 10th day after quarter

Four (4) quarterly expenditure reports compiled by the 10th day after each quarter

Four (4) quarterly expenditure reports were compiled by the 10th day after each quarter

None None

Strategy to overcome areas of under performance where applicable

As refl ected in the actual achievements of the sub-programme, all the planned targets were achieved. This means that there was no under performance to be addressed.

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1.1.2 Secretariat Services

Purpose

The purpose of this sub-programme is to provide professional advice and secretariat services to the Speakership in executing their political and

constitutional responsibilities.

List of strategic objectives for the sub-programme

1. Monitor annually the fulfi lment of the constitutional mandate, with special focus on effective oversight and public participation by 2015.

2. Facilitate annually, the development, implementation and monitoring of legacy projects for nation-building over the next fi ve years.

1. Strategic Objective: Monitor annually the fulfi lment of the constitutional mandate, with special focus on effective oversight and public participation by 2015








1.1 Time frame for the development and update of the tabling register

- Tabling register developed and updated quar-terly

Tabling register was developed and updated quarterly

None None

1.2 Time frame for the development and update of the tabling register

- House resolutions register developed and updated quarterly

House resolutions register was developed and updated quarterly

None None

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2. Strategic Objective: Facilitate annually, the development, implementation and monitoring of legacy projects for nation-building over the next fi ve (5) years








2.1 Number and frequency of legacy projects undertaken and number of reports compiled

Five (5) legacy projects were undertaken and one (1) report was compiled within a month after the project was undertaken

Five (5) legacy projects undertaken and one (1) report compiled for each project

Six (6) legacy projects were undertaken and one (1) report was compiled for each project

There was an overachievement of one (1) target

An additional legacy project was undertaken by the Legislature

Strategy to overcome areas of under performance

As refl ected in the actual achievements of the Section, all the planned targets were achieved. This means that there was no under performance to be addressed.

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1.1.3 Treasury

Purpose

The purpose of this sub-programme is to advise the Speaker in exercising the Treasury function of the Legislature and to oversee the Implementation of prescripts related to fi nancial matters.


1. Strengthen fi nancial management support in order to enhance the treasury function by 2015.

1. Strategic Objective: Strengthen fi nancial management support in order to enhance the treasury function by 2015








1.1 Number of workshops conducted on FMPPLA

Two (2) workshops were conducted on FMMPLA and one (1) report was compiled within a month after the workshop

Two (2) workshops conducted on FMPPLA

Two (2) workshops were conducted on FMPPLA

None None

1.2 Number and time frame of budget submissions received and processed

Three (3) budget submissions were received and processed within ten (10) days of receipt

One (1) budget submission received and processed by April 2014

One (1) budget submission was received and processed by April 2014

None None

1.3 Number and frequency of budget performance analysis conducted

-

Four (4) budget performance analysis conducted

Four (4) budget performance analysis were conducted

None None



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1.2 Offi ce of the Secretary

Purpose

The purpose is to provide overall strategic leadership, management and administration to ensure effective and effi cient functioning of the Legislature in achieving its vision and fulfi lling its constitutional mandate.

List of strategic objectives for Offi ce of the Secretary

1. Ensure annually, effective leadership, management and administration through institutional strategy, policies and systems over the next fi ve years.

2. Ensure effective corporate and fi nancial governance for legislative compliance, and improved institutional integrity and public confi dence by 2015.

3. Provide effective support regarding organisational strategy for achieving the vision and mandate of the Legislature.

4. Provide internal audit service to improve the effectiveness of internal control processes and procedures of the Legislature by 2015.

5. Provide risk management services to promote good corporate governance within the Legislature by 2015.

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1.2.1 Management

The purpose is to provide strategic leadership and management to ensure institutional effectiveness in supporting the core business of the Legislature.

List of strategic objectives for sub-programme

1. Ensure annually, effective leadership, management and administration through institutional strategy, policies and systems over the next fi ve years.

2. Ensure effective corporate and fi nancial governance for legislative compliance, and improved institutional integrity and public confi dence by 2015.

1. Strategic Objective: Ensure annually, effective leadership, management and administration through institutional strategy, policies and systems over the next fi ve years








1.1 Timeframe for the development and update of the tabling register

- Tabling register developed and updated quarterly

Tabling register was developed and updated quarterly

None None

1.2 Number of Legislature colloquium sessions held and number of reports compiled

Annual Performance Plan was developed in line with fi ve year strategy by January 2013

Annual Performance Plan developed in line with fi ve-year strategy developed by the 31st January 2015

Annual Performance Plan was developed in line with fi ve-year strategy developed by the 31st January 2015

None None

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2. Strategic Objective: Ensure effective corporate and fi nancial governance for legislative compliance, and improved institutional integrity and public confi dence by 2015








1.3 Number and frequency of meetings held by each of the corporate governance structures

Four (4) quarterly meetings were not held by each of the four (4) corporate governance structures

Four (4) quarterly reports on activities of corporate governance structures compiled

Four (4) quarterly reports on activities of corporate governance structures were compiled

None None



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1.2.2 Planning, Performance Monitoring and Evaluation

The purpose is to provide planning and performance monitoring and evaluation services in order to enhance institutional effectiveness in the achievement of the vision and constitutional mandate of the Legislature.


1. Provide effective support regarding organisational strategy for achieving the vision and mandate of the Legislature.

1. Strategic Objective: Provide effective support regarding organisational strategy for achieving the vision and mandate of the Legislature








1.1 Time frame for developed Annual Performance Plans in line with fi ve-year strategy

Annual Performance Plan was developed in line with fi ve year strategy by the 31st of January 2014

Annual Performance Plan developed in line with fi ve-year strategy by the 31st of January 2015

Annual Performance Plan was developed in line with fi ve-year strategy by the 31st of January 2015

None None

1.2.1 Number and frequency of institutional performance monitoring reports developed

Four (4) quarterly institutional performance reports were developed

Four (4) quarterly and one (1) annual institutional performance reports developed

Four (4) quarterly institutional performance reports were developed

None None

1.2.2 Number of annual institutional performance reports developed

Institutional annual report was compiled by 10 August 2013

One (1) annual institutional performance report was developed

None None

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1. Strategic Objective: Provide effective support regarding organisational strategy for achieving the vision and mandate of the Legislature








1.3.1 Number and frequency of performance assessment reports developed

One (1) mid-year performance assessment report was developed One (1)

mid-year assessment and four (4) quarterly institutional performance evaluation reports developed

One (1) mid-year performance assessment report was developed

None None

1.3.2 Number and frequency of performance evaluation reports developed

Four (4) quarterly performance evaluation reports were developed

Four (4) quarterly performance evaluation reports were developed

None None

1.4.1 Time frame for development and update of internal Audit action plan on PPM&E fi ndings

-

Internal and external audit action plan on PPM&E fi ndings developed and updated

Internal audit action plan on PPM&E fi ndings was developed and updated

None None

1.4.2 Time frame for development and update of external Audit action plan on PPM&E fi ndings

- External audit action plan on PPM&E fi ndings was developed and updated

None None



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1.2.3 Internal Audit

The purpose is to provide internal audit services to the Legislature in support of the fulfi lment of the constitutional mandate.


1. Provide internal audit service to improve the effectiveness of internal control processes and procedures of the Legislature by 2015.

1. Strategic Objective: Provide internal audit service to improve the effectiveness of internal control processes and procedures of the Legislature by 2015








1.1 Time frame for review of internal audit charter and audit committee charter

Internal audit charter and audit committee charter were reviewed annually

Internal audit and audit committee charters reviewed annually

Internal audit charter and audit committee charter were reviewed annually

None None

1.2 Time frame for reviewed three-year risk-based audit plan and developed one-year operational plan

Three-year risk-based audit plan was reviewed annually

Three-year risk-based audit plan reviewed annually and one-year audit operational plan developed

Three-year risk-based audit plan was reviewed annually and one-year audit operational plan developed

None None

1.3 Number and frequency of internal audit status reports compiled

- Four (4) internal audit status reports compiled

Four (4) internal audit status reports were compiled

None None

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1. Strategic Objective: Provide internal audit service to improve the effectiveness of internal control processes and procedures of the Legislature by 2015








1.4 Time frame for the development, review and update of Institutional Corporate Governance Model

- Institutional Corporate Governance Model developed

Institutional Corporate Governance Model was developed

None None



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1.2.4 Risk Management

The purpose is to provide risk management services to the Legislature in support of the fulfi lment of the constitutional mandate.

List of strategic objective for the sub-programme

1. Provide risk management services to promote good corporate governance within the Legislature by 2015.

1. Strategic Objective: Provide risk management services to promote good corporate governance within the Legislature by 2015








1.1 Number and frequency of risk awareness workshops held and report produced

One (1) risk awareness workshop was held annually and one (1) report was produced

Two (2) risk awareness workshops held and a report produced for each workshop

Two (2) risk awareness workshops were held and a report was produced for each workshop

None None

1.2 Number of risk register developed and updated

One (1) risk assessment workshop was held annually and one (1) risk register was developed

One (1) risk register developed and updated

One (1) risk register was updated

None None

1.3 Time frame for developed risk management plan and number of reports compiled

Risk management action plan was developed annually and three (3)quarterly reports were compiled

Risk management action plan developed and three (3) risk status reports compiled

Risk manage-ment action plan was developed and three (3) risk status reports were compiled

None None

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1. Strategic Objective: Provide risk management services to promote good corporate governance within the Legislature by 2015








1.4.1 Time frame and frequency for development and update of internal audit action plan on Risk Management fi ndings

-

Internal and external audit action plan on Risk Management fi ndings developed and updated

Internal audit action plan on Risks Management fi ndings was updated

None None

1.4.2 Time frame and frequency for development and update of external audit action plan on Risk Management fi ndings

External audit action plan on Risk Management fi ndings was updated

None None



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1.3 Corporate Services

The purpose of the programme is to provide strategic and leadership support to the legislature in relation to human capital management, information and communication technology, communications and institutional support services to ensure the achievement of the core business of the Legislature.

List of strategic objectives for Corporate Services



3. Co-ordinate and monitor annually, effective implementation of the performance management system and policy to improve institutional performance and accountability by 2015.

4. Facilitate and monitor annually, continuous improvement of employment relations in the Legislature by 2015.

5. Develop human resources strategy and implement three (3) focus areas of the strategy annually, over the next fi ve (5) years.

6. Train and develop employees to increase their capacity to support the core business of the Legislature by 2015.

7. Develop and implement annually, an effective wellness programme to enhance the wellbeing of Members and staff by 2015.

8. Enhance and maintain electronic systems and infrastructure for effective support of the core business of the Legislature by 2015.

9. Profi le the Legislature to facilitate increased public awareness and public confi dence by 2015.

10. Improve coordination and monitoring of institutional security services by 2015.

11. Improve document management services in order to support the core business of the Legislature by 2015.

12. Improve facility management services to enhance institutional effi ciency in order to support the core business of the Legislature by 2015.

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1.3.1 Management

The purpose of this sub-programme is to provide effective strategic and management guidance to the Division for improved institutional effectiveness in supporting the core business of the Legislature.













Four (4) quarterly divisional performance reports were compiled by the 10th day after each quarter


Four (4) quarterly divisional employee performance reports were compiled

None None

1.1.2 Time frame for the compilation of the annual employee performance report of the previous fi nancial year

One (1) annual divisional performance report was compiled by the 10th of May 2013

One (1) annual divisional per-formance report was compiled

None None





None None



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1.3.2 Human Capital Management

The purpose of the sub-programme is to provide support to the Legislature in relation to human capital management services to ensure institutional effectiveness and the achievement of the core business of the Legislature.


1. Co-ordinate and monitor annually, effective implementation of the performance management system and policy to improve institutional performance and accountability by 2015.

2. Facilitate and monitor annually, continuous improvement of employment relations in the Legislature by 2015.

3. Develop human resources strategy and implement three (3) focus areas of the strategy annually, over the next fi ve (5) years

4. Train and develop employees to increase their capacity to support the core business of the Legislature by 2015.

5. Develop and implement annually, an effective wellness programme to enhance the wellbeing of Members and staff by 2015

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1. Strategic Objective: Coordinate and monitor annually, effective implementation of the performance management system and policy to improve institutional performance and accountability by 2015








1.1 Number and frequency of performance management awareness workshops conducted and reports compiled

- Two (2) half-yearly performance management awareness workshops conducted and one (1) report compiled for each workshop

Two (2) half-yearly performance management awareness workshops were conducted and one (1) report was compiled for each workshop

None None

1.2.1 Number and time frame of institutional employee performance review reports compiled

Four (4) quarterly institutional employee performance review reports were compiled

Four (4) quarterly institutional employee performance review and one (1) annual performance assessment reports compiled

Four (4) quarterly institutional employee performance review reports were compiled

None None

1.2.2 Number and time frame of institutional employee performance assessment reports compiled

One (1) annual performance assessment report was compiled

One (1) annual performance assessment report was compiled

None None

1.3.1 Time frame and frequency for development and update of internal audit action plan on HCM fi ndings

-

Internal and external audit action plan on HCM fi ndings developed and updated

Internal audit action plan on HCM fi ndings was updated

None None

1.3.2 Time frame and frequency for development and update of external audit action plan on HCM fi ndings

External audit action plan on HCM fi ndings was updated

None None

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2. Strategic Objective: Facilitate and monitor annually, continuous improvement of employment relations in the Legislature by 2015








2.1 Number and frequency of reports on all attended labour related matters developed

Four (4) quarterly reports on all attended labour related matters were developed

Four (4) quarterly reports on employees relations compiled

Four (4) quarterly reports on employees relations were compiled

None None

3. Strategic Objective: Develop human resources strategy and implement three (3) focus areas of the strategy annually, over the next fi ve (5) years








3.1 Number and frequency of reports developed on the implementation of the three (3) focus areas of the HR strategy

Three (3) quarterly reports on the implementation of the three (3) focus areas of the HR strategy were developed

Four (4) quarterly reports compiled on the implementation of the HR strategy

Four (4) quarterly reports were compiled on the implementation of the HR strategy

None None

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4. Strategic Objective: Train and develop employees to increase their capacity to support the core business of the Legislature by 2015








4.1 Frequency and time frame for the development and implementation of the training and development plan and number of reports compiled

Annual training and development plan was developed and three (3) quarterly reports on the implementation were compiled

Annual continuous training and development plan developed and three (3) quarterly reports on the implementation compiled

Annual training and development plan was developed and three (3) quarterly reports on the implementation were compiled

None None

5. Strategic Objective: Develop and implement annually, an effective wellness programme to enhance the wellbeing








5.1 Time frame and frequency for the development and implementation of the wellness programme and number of reports compiled

Annual wellness programme was developed and implemented and two (2) half-yearly reports were compiled

Annual wellness programme developed and two (2) half-yearly implementation reports compiled

Annual wellness programme was developed and implemented and two (2) half-yearly reports were compiled

None None



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1.3.3 Information Technology

The purpose of the sub-programme is to provide information communication technology systems and tools in order to support the core business of the Legislature.

List of strategic objectives for the sub-programme 1. Enhance and maintain electronic systems and infrastructure for effective support of the core business of the Legislature by 2015.

1. Strategic Objective: Enhance and maintain electronic systems and infrastructure for effective support of the core business of the Legislature by 2015








1.1 Frequency for the maintenance of the IT systems and number of reports developed

IT systems were maintained monthly and twelve (12) monthly reports were developed

IT systems maintained monthly and maintenance reports compiled quarterly

IT systems maintained monthly and maintenance reports were compiled quarterly

None None

1.2 Number and frequency of reports compiled on the upgrade and update of the IT systems

IT systems were upgraded and three (3) quarterly reports were developed

IT systems upgraded and updated and four (4) quarterly reports compiled

IT systems upgraded and updated and four (4) quarterly reports were compiled

None None

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1. Strategic Objective: Enhance and maintain electronic systems and infrastructure for effective support of the core business of the Legislature by 2015








1.3 Number and frequency of reports compiled on the availability of IT systems to users and on the health of IT infrastructure

Infrastructure was maintained and four (4) quarterly reports were compiled

Four (4) quarterly reports compiled on the availability of IT systems to users and on the health of IT infrastructure

Four (4) quarterly reports were compiled on the availability of IT systems to users and on the health of IT infrastructure

None None

1.4 Number and frequency of reports compiled on the implementation of the disaster recovery plan

Disaster recovery plan was tested and maintained and four (4)quarterly reports on implementation were compiled

Disaster recovery plan implemented and four (4) quarterly reports compiled

Disaster recovery plan was implemented and four (4) quarterly reports compiled

None None

1.5.1 Time frame and frequency for development and update of internal audit action plan on IT fi ndings

-

Internal and external audit action plan on IT fi ndings developed and updated

Internal audit action plan on IT fi ndings was not updated

The target was not achieved

The target could not be achieved due to a delay in the fi nalisation of institutional processes

1.5.2 Time frame and frequency for development and update of external audit action plan on IT fi ndings

External audit action plan on IT fi ndings was updated

None None


As refl ected in the actual achievements of the Section, not all the planned targets were achieved. The Programme Implementation Committee will be employed to synchronise institutional processes in order to avoid delays that affect the achievement of planned targets.

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1.3.4 Communications

The purpose of the sub-programme is to provide communications services to internal and external stakeholders, and improve institutional public image in support of the core business of the Legislature.


1. Profi le the Legislature to facilitate increased public awareness and public confi dence by 2015

1. Strategic Objective: Profi le the Legislature to facilitate increased public awareness and public confi dence by 2015








1.1 Time frame and frequency for the development, implementation and update of the profi ling plan for the Legislature

Profi ling plan of the Legislature was developed annually, implemented and updated quarterly

Annual communication Strategy for profi ling Legislature activities developed, reviewed and updated and four quarterly implementation reports compiled

Annual communication Strategy for profi ling Legislature activities was developed, reviewed and updated and four quarterly implementation reports were compiled

None None

1.2 Number and frequency of internal and external newsletters produced

Four (4) internal and three (3) external newsletters were produced

Four (4) internal and three (3) external newsletters produced

Six (6) internal and four (4) external newsletters were produced

There was an overachievement of two (2) internal and one (1) external newsletters

Additional newsletters were produced due to demand by the Legislature

1.3 Number and frequency of the Legislature events mar-keted

Twenty-eight (28) targeted Legislature events were marketed

Twenty (20) targeted Legislature events branded and marketed annually

Twenty-fi ve (25) targeted Legislature events were branded and marketed annually

There was an overachievement of fi ve (5) targets

More Legislature events were branded and marketed due to increased number of events conducted

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1. Strategic Objective: Profi le the Legislature to facilitate increased public awareness and public confi dence by 2015








1.4 Time frame for the development and implementation of the communication plan and number of reports compiled

Communication plan was developed and implemented and two (2) reports were compiled

Souvenir shop marketing plan reviewed, updated and four (4) quarterly implementation reports compiled

Souvenir shop marketing plan was not reviewed and updated


The target could not be achieved due to the delay in consultation process that took longer than anticipated

1.5 Time frame for the establishment of electronic information centre and number of reports compiled

Electronic information centre was not established

Forty (40) electronic media slots utilised annually

Eighty-nine (89) electronic media slots were utilised annually

There was an overachievement of forty-nine (49) targets

More media slots became available due to the demand and therefore additional slots were used


As refl ected in the actual achievements of the Section, not all the planned targets were achieved. The Programme Implementation Committee will employed to synchronise institutional processes in order to avoid delays that affect the achievement of planned targets.

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1.3.5 Institutional Support The purpose of the sub-programme is to provide effective and effi cient institutional services in support of the core business of the Legislature.

List of strategic objectives for the sub-programme 1. Improve co-ordination and monitoring of institutional security services by 2015.

2. Improve document management services in order to support the core business of the Legislature by 2015.

3. Improve facility management services to enhance institutional effi ciency in order to support the core business of the Legislature by 2015.

1. Strategic Objective: Improve co-ordination and monitoring of institutional security services by 2015








1.1 Time frame for the development of the security strategy implementation plan and number of reports compiled

Security strategy implementation plan was devel-oped and three (3) quarterly reports were compiled

Legislature security strategy implemented and four (4) quarterly reports compiled

Legislature security strategy was implemented and four (4) quarterly reports were compiled

None None

2. Number and frequency of reports compiled on Legislature events coordinated and inspections conducted at the Speaker’s residence

- Four (4) quarterly reports compiled on Legislature events coordinated and inspections conducted at the Speaker’s residence

Four (4) quarterly reports were compiled on Legislature events coordinated and inspections conducted at the Speaker’s residence

None None

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2. Strategic Objective: Improve document management services in order to support the core business of the Legislature by 2015








2.1 Number and frequency of reports compiled on the implementation of EDMS

- Four (4) quarterly reports compiled on the implementation of the EDMS

Four (4) quarterly reports were compiled on the implementation of the EDMS

None None

2.2 Time frame for review of the document management framework and number and frequency of implementation reports compiled

- Document management framework reviewed and four (4) implementation reports compiled

Document management framework was reviewed and four (4) implementation reports were compiled

None None

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55

3. Strategic Objective: Improve facility management services to enhance in-stitutional effi ciency in order to support the core business of the Legislature by 2015








3.1 Time frame for the implementation of the facilities management enhancement strategy and number of reports compiled

Facilities management enhancement plan was implemented and three (3) quarterly reports were compiled

Facility management plan reviewed and four (4) implementation reports compiled

Facility management plan was reviewed and four (4) implementation reports were compiled

None None

3.2 Number and frequency of transport reports compiled

- Twelve (12) monthly transport reports compiled

Twelve (12) monthly transport reports were compiled

None None

3.3 Time frame for the development of annual implementation plan and number of reports produced

Annual implementation plan for provision of library services was developed and implemented and three (3) reports were produced

Annual plan for provision of library Services developed and three (3) reports produced

Annual plan for provision of library Services was developed and three (3) reports were produced

None None



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1.4 Financial Management

The purpose of the programme is to support the Legislature and its Parliamentary Committees through effective fi nancial management, supply chain and risk management functions for the fulfi lment of the constitutional mandate of the Legislature.

List of strategic objectives for Financial Management



3. Promote compliance with relevant prescripts, governance practices and policies to obtain a clean audit opinion by 2015.

4. Manage assets effectively to optimise their service delivery potential over their life, and to implement an accrual accounting system by 2015.

1.4.1 Management

The purpose is to provide strategic management and support in relation to fi nancial services to ensure institutional effectiveness in the fulfi lment of the constitutional mandate of the Legislature.


1. Strengthen annually, the strategic and fi nancial management functions for enhanced divisional and institutional effectiveness by 2015

2. Ensure effective corporate and fi nancial governance for legislative compliance and improved institutional integrity and public confi dence by 2015

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57










Four (4) quarterly divisional performance reports were compiled within ten (10) days after the quarter


Four (4) quarterly divisional performance reports were compiled

None None

1.1.2 Time frame for the compilation of the annual divisional employee performance report of the previous fi nancial year

One (1) annual divisional performance report was compiled by the 10th of May 2013

One (1) annual divisional employee performance report was compiled

None None

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Four (4) quarterly expenditure reports were compiled by the tenth (10th) day after the quarter



None None

2.2 Time frame for update and review of the Internal Control Procedure Manual

- The Internal Controls Procedure manual updated

The Internal Controls Procedure manual was updated

None None



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59

1.4.2 Finance

The purpose is to provide effective and effi cient fi nancial services in support of the core business of the Legislature.

List of strategic objective for the sub-programme

1. Promote compliance with relevant prescripts, governance practices and policies to obtain a clean audit opinion by 2015.

1. Strategic Objective: Promote compliance with relevant prescripts, governance practices and policies to obtain a clean audit opinion by 2015








1.1 Number and time frame of budget submissions compiled

One (1) budget submission was compiled by May 2013

One (1) budget submission compiled

One (1) budget submission was compiled

None None


Twelve (12) monthly reports were compiled and submitted

Twelve (12) monthly expenditure reports compiled

Twelve (12) monthly reports were compiled

None None

1.3 Number and frequency of fi nancial statements and audit fi les prepared

Two (2) fi nancial statements and one (1) audit fi le were prepared

Four (4) Financial Statements and four (4) audit fi les prepared

Four (4) fi nancial statements and four (4) audit fi les were prepared

None None

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1. Strategic Objective: Promote compliance with relevant prescripts, governance practices and policies to obtain a clean audit opinion by 2015








1.4.1 Time frame for development and update of internal Audit action plan on Finance fi ndings

-

Internal and external audit action plan on Finance fi nd-ings developed and updated

Internal audit action plan on Finance fi ndings was updated

None None

1.4.2 Time frame for development and update of external Audit action plan on Finance fi ndings

External audit action plan on Finance fi ndings was updated

None None



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1.4.3 Supply Chain Management

The purpose of this sub-programme is to provide effective and effi cient management of the supply chain and assets to support the core business of the Legislature.


1. Manage assets effectively to optimise their service delivery potential over their life, and to implement an accrual accounting system by 2015.

1. Strategic Objective: Promote Manage assets effectively to optimise their service delivery potential over their life, and to implement an accrual accounting system by 2015








1.1 Frequency for an update of asset acquisition maintenance and disposal plan

Asset acquisition maintenance and disposal plan was updated annually

Asset acquisition, maintenance and disposal plan updated annually

Asset acquisition, maintenance and disposal plan was updated annually

None None

1.2 Time frame for update of data-base of suppliers

Database of suppliers was updated and automated

Database of suppliers updated

Database of suppliers was updated

None None

1.3 Number and frequency of asset verifi cation projects conducted and asset register updated

Four (4) physical asset verifi cation projects were conducted and asset register was updated

Four (4) physical asset verifi cation projects conducted and asset register updated

Four (4) physical asset verifi cation projects were conducted and asset register was updated

None None

1.4 Number and frequency of physical inventory counts conducted and records updated

Four (4) physical inventory counts were conducted and records were updated

Four (4) physical inventory counts conducted and records updated

Four (4) physical inventory counts were conducted and records were updated

None None

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1. Strategic Objective: Promote Manage assets effectively to optimise their service delivery potential over their life, and to implement an accrual accounting system by 2015








1.5 Number and frequency of asset disposal projects conducted and reports compiled

Two (2) assets’ disposal projects were not conducted

One (1) assets disposal conducted, one (1) report compiled and the ledger updated

One (1) assets disposal project was not conducted


The targets could not be achieved due to the delay in fi nalisation of asset values

1.6 Time frame for procurement plan developed, implemented, reviewed and updated and number of reports compiled

Annual procurement plan was developed, implemented, reviewed and updated and four(4) reports were compiled

Annual procurement plan developed, reviewed and updated

Annual procure-ment plan was developed, reviewed and updated

None None

1.7.1 Time frame for development and update of internal Audit action plan on SCM fi ndings

-

Internal and external audit action plan on SCM fi ndings developed and updated

Internal audit action plan SCM fi ndings was updated

None None

1.7.2 Time frame for development and update of external Audit action plan on SCM fi ndings

External audit action plan on SCM fi ndings was updated

None None


As refl ected in the actual achievements of the Section, not all the planned targets were achieved. The Programme Implementation Committee will be employed to synchronise institutional processes in order to avoid delays that affect the achievement of planned targets.

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PROGRAMME 2: PARLIAMENTARY BUSINESS

The purpose is to provide strategic management and support in relation to parliamentary services to ensure institutional effectiveness in the fulfi lment of the constitutional mandate of the Legislature.

List of strategic objectives for Programme 2: Parliamentary Business

1. Strengthen annually, the strategic and fi nancial management functions for enhanced divisional and institutional effectiveness by 2015;

2. Ensure effective corporate and fi nancial governance for legislative compliance and improved institutional integrity and public confi dence by 2015;

3. Improve House proceedings and Hansard support for effective oversight and law-making functions of the Legislature by 2015;

4. Improve parliamentary support for effective oversight and law-making functions of the Legislature;

5. Improve research and policy analysis support for effective oversight and law-making functions of the Legislature;

6. Improve legal support for effective law-making processes and practices of the Legislature by 2015;

7. Strengthen support for corporate governance regarding legislative compliance and improved institutional integrity and public confi dence;

8. Improve public education and involvement in the Legislature processes to inspire public confi dence by 2015;

9. Strengthen the management and administration of Members’ Affairs and transfers to Political Parties to improve the execution of the mandate of the Legislature by 2015;

10. Improve protocol service to enhance institutional integrity and strengthen strategic relationships by 2015; and

11. Promote inter-parliamentary relations to strengthen strategic relationships for deepened parliamentary democracy by 2015.

2.1 Law Making

The purpose is to provide strategic leadership and management to ensure Divisional effectiveness in support of the core business of the Legislature.

2.1.1 Management

Purpose

The purpose is to provide strategic leadership and management to ensure Divisional effectiveness in support of the core business of the Legislature.

List of strategic objectives for Management



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Four (4) quarterly divisional performance reports were compiled within ten (10) days after the quarter


Four (4) quarterly divisional performance reports were compiled

None None

1.1.2 Time frame for the compilation of the annual employee performance report of the previous fi nancial year

One (1) annual divisional per-formance report was compiled by the 10th of May 2013

One (1) annual divisional employee performance report was compiled

None None

1.2 Number and frequency of reports on the implementation of institutional strategic projects compiled

Three (3) quarterly reports on the implementation of institutional strategic projects were compiled within fi fteen (15) days after the quarter

Three (3) quarterly reports on the implementation of institutional strategic projects compiled within fi fteen (15) days after each quarter

Three (3) quarterly reports on the implementation of institutional strategic projects were compiled within fi fteen (15) days after each quarter

None None

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65









1.3 Frequency and time frame for SOM implementation plan developed, implemented, reviewed and updated and reports compiled

SOM implementation plan was developed, implemented, reviewed and updated and two (2) reports were compiled

SOM implementation plan developed, reviewed and updated and two (2) implementation reports compiled

SOM implementation plan was developed, reviewed and updated and two (2) implementation reports were compiled

None None

1.4 Time frame for the development and review of integrated divisional business process manual

- Integrated divisional business process manual developed

Integrated divisional business process manual was developed

None None

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Four (4) quarterly expenditure reports were compiled within ten (10) days after the quarter

Four (4) quarterly expenditure reports each compiled, within ten (10) days after each quarter

Four (4) quarterly expenditure reports each were compiled, within ten (10) days after each quarter

None None



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2.1.2 House Proceedings and Hansard

The purpose is to co-ordinate and facilitate the business of the House, and to provide Hansard and language services in support of the core business of the Legislature.

List of strategic objectives for Parliamentary Operations

1. Improve House proceedings and Hansard support for effective oversight and law-making functions of the Legislature by 2015.

1. Strategic Objective: Improve House proceedings and Hansard support for effective oversight and law-making functions of the Legislature by 2015








1.1 Number and frequency of reports compiled on the monitoring of House resolutions

Four (4) quarterly reports were compiled on the monitoring of House resolutions by the fi fteenth (15th) working day after the end of the quarter

Four (4) quarterly reports compiled on the monitoring of House resolutions

Four (4) quarterly reports were compiled on the monitoring of House resolutions

None None

1.2 Number and frequency of Sittings coordinated

Twenty-three (23) Sittings were coordinated

Twenty-eight (28) Sittings coordinated annually

Twenty-four (24) Sittings were coordinated annually

There was a deviation of four (4) targets

Fewer Sittings were coordinated than planned due to the reprioritisation of the programme of the Legislature

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1. Strategic Objective: Improve House proceedings and Hansard support for effective oversight and law-making functions of the Legislature by 2015








1.3 Number and frequency of Hansard records compiled

Twenty-four (24) Hansard records were compiled

Twenty-eight (28) Hansard records compiled annually

Twenty-two (22) Hansard records were compiled annually

There was deviation of six (6) targets

Fewer Hansard records were produced than planned due to reprioritisation of the programme of the Legislature and due to capacity constraints

1.4 Number of offi cial languages in which interpretation service was rendered during the Sittings of the Legislature

Interpretation service was rendered in four (4) offi cial languages during Sittings of the Legislature

Interpretation service rendered in six (6) offi cial languages during Sittings of the Legislature

Interpretation service was rendered in four(4) offi cial languages during Sittings of the Legislature

There was a deviation of two (2) targets

Interpretation service was rendered in fewer languages during the Sittings due to capacity constraints and reprioritisation of the programme of the Legislature

1.5 Number of offi cial languages in which translation service was rendered during the Sittings of the Legislature

Translation service was rendered in four (4) offi cial languages during Sittings of the Legislature

Translation service rendered in six (6) offi cial languages

Translation service was rendered in four (4) offi cial languages during Sittings of the Legislature

There was deviation of four (4) targets

Translation service was rendered in fewer languages during the Sittings due to capacity constraints


As refl ected in the actual achievements of the Section, not all the planned targets were achieved. With regard to the targets on Hansard, translation and interpretation, issues of constraints with regard to human resources have been addressed through the employment of additional personnel. In order to address the challenge regarding the coordination of Sittings, the Programme Implementation Committee has been established so as to align political and administration programmes.

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2.2 Oversight

2.2.1 Committees and NCOP Support Services

The purpose is to provide professional and administrative support to Committees, and liaison function between the Legislature and the NCOP for the fulfi lment of the constitutional mandate.


1. Improve parliamentary support for effective oversight and law-making functions of the Legislature.

1. Strategic Objective: Improve parliamentary support for effective oversight and law-making functions of the Legislature








1.1 Frequency for development, implementation and updating of annual programme of committees

Annual programme of committees was developed, implemented and updated fortnightly (every second week)

Annual programme of committees developed, implemented and updated fortnightly (every second week)

Annual programme of committees was developed, implemented and updated fortnightly (every second week)

None None

1.2 Number and time frame of committee reports produced

One hundred and eighty-four (184) committee reports were each produced within four (4) days of the relevant committee deliberations

Sixty-fi ve (65) committee reports each produced within four (4) days of the relevant committee deliberations

Fifty nine (59) committee reports were each produced within four (4) days of the relevant committee deliberations

There was an underachievement of six (6) targets

Fewer reports were compiled within four days than planed

1.3 Number and time frame of sets of minutes produced for committee meetings

One hundred and seventy three (173) sets of minutes were each produced within two (2) days of a relevant committee meeting

Ninety (90) sets of minutes each produced within two (2) days of a relevant committee meeting

Hundred and thirty seven (137) sets of minutes were each produced within two (2) days of a relevant committee meeting

There was an overachievement of forty seven (47) targets

More meetings were held than anticipated

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1. Strategic Objective: Improve parliamentary support for effective oversight and law-making functions of the Legislature








1.4 Number and time frame of mandates com-piled for commit-tees

Forty nine (49) mandates were compiled each within a day of relevant committee deliberations

Five (5) mandates compiled each within a day of relevant committee deliberations

Three (3) mandates were compiled each within a day of relevant committee deliberations

There was deviation of two (2) targets

No Section 76 pieces of legislation were received from the NCOP

1.5 Frequency for incorporation and updating of NCOP activities in the Legislature programme

NCOP activities were incorporated and updated fortnightly in the Legislature programme

NCOP activities incorporated and updated fortnightly in the Legislature programme

NCOP activities were incorporated and updated fortnightly in the Legislature programme

None None


As refl ected in the actual achievements of the Section, not all the planned targets were achieved. The programme of the Legislature had to be reprioritised due to the 2014 national general elections and consequently fewer targets were achieved than planned. The Programming and Prioritisation Committee and the Programme Implementation Committee will be employed to synchronise institutional processes.

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71

2.2.2 Research

The purpose is to provide research, policy analysis, and knowledge management in support of the core busi-ness of the Legislature.

List of strategic objectives for Research

1. Improve research and policy analysis support, for effective oversight and law-making functions of the Legislature.

1. Strategic Objective: Improve research and policy analysis support, for effective oversight and law-making functions of the Legislature








1.1 Number and frequency of budget analysis reports produced for parliamentary committees

Eighteen (18) budget analysis reports were compiled for parliamentary committees

Eighteen (18) budget analysis reports produced for parliamentary committees

Nineteen (19) budget analysis reports were compiled for parliamentary committees


An additional budget analysis report was produced for the Portfolio Committee

1.2 Number and frequency of reports analysis produced for parliamentary committees

Eighteen (18) annual reports analysis were produced for parliamentary committees

Seventeen(17) annual reports analysis produced for parliamentary committees

Eighteen (18) annual reports analysis were produced for parliamentary committees


An additional annual report was produced for the Portfolio Committee

1.3 Number and frequency of fi nancial statement analyses produced for SCOPA

Seventeen (17) fi nancial statement analyses were produced for SCOPA

Seventeen (17)fi nancial statement analysis produced for SCOPA

Seventeen (17) fi nancial statement analyses were produced for SCOPA

None None

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1.4 Number and frequency of report analysis produced for parliamentary committees

Fifty-three (53) quarterly report analysis were produced for parliamentary committees

Fifty one (51) quarterly report analysis produced for parliamentary committees


There was an overachievement of two (2) targets

Additional quarterly analysis reports were produced than anticipated

1.5 Number and frequency of research reports produced for parliamentary committees

Fifty-fi ve (55) commissioned research reports were produced for parliamentary committees

Forty-four (44) research reports produced for parliamentary committees

Seventy-four (74) research reports were produced for parliamentary committees

There was an overachievement of thirty (30) targets

More research reports were produced due to research demand from Committees

1.6 Number and Frequency of review of institu-tional policies

Fifty-seven (57)institutional policies were reviewed annually

Twenty-seven (27) institutional policies reviewed

Institutional policies were not reviewed


More research reports were produced due to research demand from Committee

1.7 Time frame and frequency for development, implementation, review and update of knowledge management plan

-

Knowledge management plan developed and implemented

One (1) knowledge management capacity building workshop was held

None None

Knowledge management Audit was conducted

None None


As refl ected in the actual achievements of the Section, not all the planned targets were achieved. The Programme Implementation Committee will be employed to synchronise institutional processes.

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73









1.4 Number and frequency of report analysis produced for parliamentary committees


Fifty one (51) quarterly report analysis produced for parliamentary committees


There was an overachievement of two (2) targets

Additional quarterly analysis reports were produced than anticipated

1.5 Number and frequency of research reports produced for parliamentary committees

Fifty-fi ve (55) commissioned research reports were produced for parliamentary committees

Forty-four (44) research reports produced for parliamentary committees

Seventy-four (74) research reports were produced for parliamentary committees

There was an overachievement of thirty (30) targets

More research reports were produced due to research demand from Committees

1.6 Number and Frequency of review of institu-tional policies

Fifty-seven (57)institutional policies were reviewed annually

Twenty-seven (27) institutional policies reviewed

Institutional policies were not reviewed


More research reports were produced due to research demand from Committee

1.7 Time frame and frequency for development, implementation, review and update of knowledge management plan

-

Knowledge management plan developed and implemented

One (1) knowledge management capacity building workshop was held

None None

Knowledge management Audit was conducted

None None


As refl ected in the actual achievements of the Section, not all the planned targets were achieved. The Programme Implementation Committee will be employed to synchronise institutional processes.

2.2.3 Legal Services

The purpose is to provide professional legal services in support of the core business of the Legislature.

List of strategic objectives for Legal Services

1. Improve legal support for effective law-making processes and practices of the Legislature by 2015.

2. Strengthen support for corporate governance regarding legislative compliance and improved institutional integrity and public confi dence by 2015.

1. Strategic Objective: Improve legal support for effective law-mak-ing processes and practices of the Legislature by 2015








1.1 Number and time frame for requested legal opinions drafted

Thirty (30) requested legal opinions were drafted, each within fi ve (5) days of request

Twenty six (26) requested legal opinions drafted, each within fi ve (5) days of request

Twenty seven (27) requested legal opinions were drafted, each within fi ve (5) days of request

There was an over-achievement of one (1) target

More requests for legal opinions were received and drafted than planned

1.2 Number and frequency of pieces of legislation reviewed

Thirty-fi ve (35) pieces of legislation were reviewed

Six (6) pieces of legislation reviewed

Nine (9) pieces of legislation were reviewed

There was an over-achievement of three (3) targets

More pieces of legislation were received and reviewed than anticipated

1.3 Number and frequency of reports compiled on rulings made by the Presiding Offi cer

Four (4) quarterly reports were compiled on rulings made by the Presiding Offi cer

Four (4) quarterly reports compiled on rulings made by the Presiding Offi cer

Four (4) quarterly reports were compiled on rulings made by the Presiding Offi cer

None None

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2. Strategic Objective: Strengthen support for corporate governance regarding legislative compliance and improved institutional integrity and public confi dence by 2015








2.1 Frequency of updating contract management register

Contract management register was updated

Contracts management register updated quarterly

Contracts management register was updated quarterly

None None

2.2 Number and frequency of reports compiled on litigation matters pertaining to the Legislature

Four (4) quarterly reports were compiled on litigation matters pertaining to the Legislature

Four (4) quarterly reports compiled on litigation matters pertaining the Legislature

Four (4) quarterly reports were compiled on litigation matters pertaining the Legislature

None None

2.3 Number and frequency of reports com-piled on con-tracts drafted

Four (4) quarterly reports were compiled on contracts drafted

Four (4) quarterly reports compiled on contracts drafted

Four (4) quarterly reports were compiled on contracts drafted

None None

2.4 Frequency for updating the legislative com-pliance register

Legislative compliance register was updated twice a year

Legislative compliance register monitored and updated four times a year

Legislative compliance register monitored and was updated four times a year

None None

2.5 Time frame for the development and review of legal training documentation

- Legal training documentation developed and reviewed twice a year

Legal training documentation was developed and reviewed twice a year

None None



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2.3 Public Participation

2.3.1 Public Participation and Petitions

The purpose is to provide professional and administrative services regarding public involvement and public participation in support of the core business of the Legislature.


1. Improve public education and involvement in Legislature processes to inspire public confi dence by 2015.

1. Strategic Objective: Improve public education and involvement in Legislature processes to inspire public confi dence by 2015








1.1 Number of public education and democracy workshops conducted

Sixty (60) public education workshops were conducted

Sixty (60) public education and democracy workshops conducted

Sixty-six (66) public education workshops were conducted

There was an over-achievement of six (6) targets

More workshops were conducted than planned due to reprioritisation of the Legislature business

1.2 Number of sectoral Parliaments conducted and reports compiled

Seven (7) sectoral Parliaments were conducted and seven (7) reports compiled

Seven (7) sectoral Parliaments conducted and seven (7) reports compiled

Seven (7) sectoral Parliaments were conducted and seven (7) reports were compiled

None None

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1. Strategic Objective: Improve public education and involvement in Legislature processes to inspire public confi dence by 2015








1.3 Number and frequency of petitions processed and reports compiled

One hundred and eighty seven (187) petitions were processed and four (4) reports were compiled

One hundred and fi fty (150) petitions processed and four (4) reports compiled

One hundred and seventy three (173) petitions were processed and four (4) reports were compiled

There was an over-achievement of twenty-three (23) targets

Due to public education, TLP and SOPA, more petitions were received and processed than planned

1.4 Number and frequency of Petitions’ Clinics conducted

Twenty-three (23) Petitions’ Clinics were conducted

Thirty (30) Pe-titions’ Clinics conducted

Thirty (30) Petitions’ Clinics were conducted

None None



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2.4 Members Facilities

2. 4.1 Members’ Affairs and Political PartiesPurpose

The purpose is to provide professional and administrative support services to Members in order to fulfi l the constitutional mandate of the Legislature.


1. Strengthen the management and administration of Members’ Affairs and transfers to Political Parties to improve the execution of the mandate of the Legislature by 2015.

1. Strategic Objective: Strengthen the management and administration of Members’ Affairs and transfers to Political Parties to improve the execution of the mandate of the Legislature by 2015








1.1 Time frame for the development, implementation and updating of the annual training programme for Members

Annual training programme for Members was developed and updated

Annual training programme for Members developed, implemented and updated

Annual training programme for Members was developed and updated

None None

1.2 Number of training sessions for Members coordinated and reports compiled

Four (4) training sessions for Members were coordinated and four (4) reports were compiled

Three (3) training sessions for Members coordinated and three (3) reports compiled

Six (6) training sessions for Members were coordinated and six (6) reports were compiled

There was an over-achievement of three (3) targets

More training sessions were coordinated as a result of request by the funder for the training of Members

1.3 Number of reports compiled on services provided to Members

Four (4) reports were compiled on services provided to Members

Four (4) reports compiled on services provided to Members

Four (4) reports were compiled on services provided to Members

None None

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1.4 Frequency for the development and updating of Members’ profi le

Members’ profi le was developed and updated annu-ally

Members’ profi le developed and updated annually

Members’ profi le was developed and updated annually

None None



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2.5 Cooperative Governance

2.5.1 Inter-parliamentary relations and Parliamentary Advisory Services

Purpose

The purpose is to provide professional parliamentary advisory and protocol services in support of the core business of the Legislature.


1. Improve protocol service to enhance institutional integrity and strengthen strategic relationships by 2015.

2. Promote inter-parliamentary relations to strengthen strategic relationships for deepened parliamentary democracy by 2015.









1.1 Number and frequency of targeted Legislature events coordinated and protocol implementation plans developed

Twenty six (26) targeted Legislature events and visits were coordinated,and twenty six (26) protocol implementation plans were developed

Twenty (20) targeted Legislature events coordinated and twenty (20) protocol implementation plans developed

Thirty one (31) Legislature events and thirty one (31) protocol implementation plans were developed

There was an over-achievement of eleven (11) targets

There were more Legislature events coordinated than planned due to the reprioritisation of the Legislature programme

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2. Strategic Objective: Promote inter-parliamentary relations to strengthen strategic relationships for deepened parliamentary democracy by 2015








2.1 Number and frequency of targeted Legislature international events and visits coordinated and reports compiled

Eleven (11) targeted Legislature international events and visits were coordinated, and eleven (11) reports were compiled

Twenty (20) targeted Legislature international events and visits coordinated, and twenty (20) reports compiled

Nine (9) Legislature international events and visits were coordinated, and nine (9) reports were compiled

There was under-achievement by eleven (11) events

Fewer international events were undertaken than planned


As refl ected in the actual achievements of the sub-programme, not all the planned targets were achieved due to the reprioritisation of the Legislature programmes. The Programming and Prioritisation Committee and the Programme Implementation Committee will be employed to ensure alignment between political and administration programmes.

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2.6 Linking performance with budgets at programme level

2014/2015 2013/2014Sub-programme Name

Final Appropriation

Actual Expenditure

(Over)/Under

Expenditure

Final Appropriation

Actual Expenditure

(Over)/Under Expenditure

R’000 R’000 R’000 R’000 R’000 R’000Administration 135 335 133 252 2 083 111 156 111 125 31Parliamentary Business

155 786 155 670 116 140 249 139 752 497

Total 291 121 288 922 2 199 251 405 250 877 528

2.7 Summary of Financial Information

Institutional receipts

2014/2015 2013/2014Receipts Estimate Actual

Amount Collected

(Over)/Under

Collection

% Over/Under

collection

Estimate Actual Amount

Collected

(Over)/Under

Collection

% Over/Under

collectionR’000 R’000 R’000 R’000 R’000 R’000

Sale of goods and services other than capital assets

13 3 (10) (76.9) 14 8 6 (42.0)

Transfers received

0 250 250 100 0 100 100 100

Interest, divi-dends and rent on land

779 756 (23) (3.0) 667 539 (128) (19.0)

Sale of capi-tal assets

273 13 (250) (95.6) 346 338 (8) (2.0)

Financial transactions in assets and liabilities

90 184 94 104.4 63 172 109 173.0

Total 1 155 1 206 51 4.4 1 090 1 157 (67) 6.0

The revenue that was collected amounted to R1.206 million as compared to the estimated amount of R1.155 million. The over collection is attributed mainly to interest earned on the bank balance, recoveries from debtors and donations received by the Legislature. It must be noted though that due to nature of the constitutional mandate of the Legislature, the revenue collected does not emanate from services that have been rendered by the institution.

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2.7.1 Transfer payments

The table below refl ects the transfer payments made for the period 1 April 2014 to 31 March 2015:

Name of trans-feree

Purpose for which the funds were used (R’000)

Final Appropriation

(R’000)

Amount transferred

(R’000)

Variance

(R’000)

Reasons for non-transfer

African National Congress

For caucus, constituency work and enhancement of democracy

27 277 27 277 0 N/A

Democratic Alliance


4 639 4 639 0 N/A

Congress of the People


381 381 0

N/A

Economic Freedom Fighters


3 371 3 371 0 N/A

Bushbuckridge Residence Association


2 400 2 189 211 Not all funds for the Bushbuckridge Residence Association were spent. The Legislature provided administrative support to this political party.

Total 38 068 37 857 211

The funds refl ected in the table above, were for a transfer to the political parties represented at the Legislature. An amount of R37.857 million was transferred out of a budget allocation of R38.068 million. The remainder will be rolled-over during the 2015/16 adjustment appropriation.

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2.7.2 Donor funds

The detail of the donation received by the Legislature is as stated on the table below:

Name of donor Standard Bank SA Breweries Full amount of the funding (R’000)

R0.150 million R0.100 million

Period of the commitment

2014/2015 fi nancial year 2014/2015 fi nancial year

Purpose of the funding To provide fi nancial support to the Legislature for activities related to the event of the State of the Province Address and for the Opening of the Legislature

To provide fi nancial support to the Legislature for activities related to the event of the State of the Province Address and for the Opening of the Legislature

Expected outputs Activities of the State of the Province Address and Opening of the Legislature are successfully undertaken in line with Rules & Orders

Activities of the State of the Province Address and Opening of the Legislature are successfully undertaken in line with Rules & Orders

Actual outputs achieved Activities of the State of the Province Address and Opening of the Legislature were successfully undertaken in line with Rules & Orders

Activities of the State of the Province Address and Opening of the Legislature were successfully undertaken in line with Rules & Orders

Amount received (R’000) R0.150 million R0.100 million

Amount spent by the Legislature (R’000)

R0.150 million R0.100 million

Reasons for the funds unspent

N/A N/A

Monitoring mechanism by the donor

N/A N/A

As refl ected in the table above, a total of R0.250 million was received in cash. A further R0.589 million was received in kind to support various legislature activities.

2.7.3 Capital investment, maintenance and asset management plan

The procurement of capital assets was done in line with the asset management plan and SCM Policy. The value of assets as at 31 March 2015 is R30.652 million. This balance has accounted for depreciation, thefts and losses in the year under review in line with the GRAP Standards. The budget set aside for the procurement of capital assets is R4.001 million over the 2015/16 MTEF. This translates to R1.180 million for 2015/16; R1.376 million for 2016/17 and R1.445 million for 2017/18.

The physical verifi cation of all assets was conducted on a quarterly basis and a manual register was updated.

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The Legislature selected to utilise the transitional provisions of Directive 8 of the Accounting Standards Board in relation to the full compliance with the standards of GRAP for reporting on property, plant and equipment. This transitional arrangement ends at the end of March 2016, after which the Legislature will be required to comply with the standards of GRAP on the measurement of capital assets. As part of the processes for ensuring full compliance with the standards of GRAP on capital assets, expert support was sought and work continued subsequent to the year end in line with the project plan. The status of the conditions of assets as refl ected in the asset register as at 31 March 2015 is as follows: 6% in very good condition, 59% in good condition, 22% is fair and 13% is in a poor condition.

The table below provides an indication of the value of assets procured in the reporting period and in the previous year:

2014/2015 2013/14Capital assets

Final Appropriation

R’000

Actual Expenditure

R’000


R’000

Final Appropriation

R’000

Actual Expenditure

R’000


R’000New and replacement assets

16 132 4 775 11 357 3 068 1 430 1 588

Total 16 132 4 775 11 357 3 068 1 430 1 588

The value of assets procured amounted to R4.775 million of a budget of R16.132 million which represents 29.59%. The reason for the under-spending on the budget for the 2014/2015 fi nancial year is due to additional funds allocated for the procurement relating to the revamp of the Chamber system.

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85

Part Three Governance

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3.1 Introduction

The Legislature adhered to the South African hybrid approach with regards to compliance with good corporate governance. King III stipulates that corporate governance relates to effective responsible leadership where the institutional values, systems and structures are fundamental elements in the achievement of institutional objectives. The Legislature has therefore established corporate governance structures which ensure that the institution utilises resources effectively, effi ciently and economically.

3.2 Risk Management

The Accounting Offi cer has to maintain effective, effi cient and transparent systems of risk management. The Legislature has conducted risk management activities in line with its approved risk management policy. This includes an integrated approach in the identifi cation and management of risk across the institution. Management held a workshop where strategic, IT and fraud business risks were identifi ed and rated. A risk register with an action plan were also developed during the period under review.

The risk management action plan was updated on a quarterly basis as implementation of mitigating controls was on-going. The risk management action plans were discussed by the relevant governance structures where management gave assurance that the control improvement plans were implemented.

3.3 Fraud and Corruption

A Fraud Prevention Plan was developed and approved by the Legislature during the year under review. The Plan was implemented and is yielding the desired results. The Audit Committee and Risk Management Committee provided valuable guidance and monitoring throughout the fi nancial year. The Legislature also compiled a whistle blowing policy which identifi ed various offi ces where fraud and/or corruption can be reported which include the National Anti-Corruption hotline, the Offi ce of the Public Protector, the Offi ce of the Auditor-General, the Offi ce of the Speaker to the Legislature and the Offi ce of the Secretary to the Legislature. The institution did conduct awareness workshops aimed at creating a conducive environment for employees to understand fraud and corruption implications and reporting thereof. The Legislature also maintains interaction with the Presidential hotline offi ce and the provincial anti-corruption offi ce on a quarterly basis to follow-up on reported cases. There were no cases reported about the Legislature during the period under review.

3.4 Minimising Confl ict of Interest

The Legislature designed the fi nancial disclosure forms which are used by all employees to disclose their fi nancial interests, details of close family members, business partners and associates and any remunerated work undertaken outside the Legislature. These forms were completed by management and employees in general and were approved by the Speaker to the Legislature.

3.5 Code of Conduct

Section 195 (1) of the Constitution of the Republic of South Africa provides that public administration must be governed by the democratic principles and values. Consequently, the institution compiled and approved a Code of Conduct and Ethics policy which is aimed at promoting and entrenching a culture of good behaviour and ethics among the employees of the Legislature. In cases where there is a breach in the Code of Conduct by employees, the Legislature’s disciplinary process is immediately initiated.

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3.6 Health, Safety and Environmental Issues

The Legislature is fully committed to protecting the health and safety of the MPLs, employees, contractors and members of the public. It has an approved OHS policy. The Legislature has also established a Safety Committee and has appointed health and safety representatives in each fl oor of the building. No health and safety hazards occurred in the Legislature during the period under review.

3.7 Select Committee on Legislature Oversight

The Legislature appeared before the Committee on the following dates:

Date of meeting Purpose of meeting23 July 2014 Interaction and consideration of the 2014/15 Annual Performance Plan 29 October 2014 Interaction and consideration of the 2013/14 Annual Report13 March 2015 Interaction and consideration of the 1st, 2nd and 3rd Quarterly Performance Reports

The following matters were raised by the Committee for implementation by the management of the Legislature:

RESOLUTION RESPONSE1. The Legislature must keep the Committee

informed on a regular basis on the developments on the amendment of the FMPA that is currently being addressed by the legislative sector through the Speakers’ Forum.

The Financial Management of Parliament and Provincial Legislatures Act, 2009 (Act No. 10 of 2009) has been passed and came into effect on 1 April 2015.

2. The DG, as the custodian of the Legislature building in terms of the National Key Points Act, must be invited to a meeting and ensure that the DPWRT adheres and implements the resolutions that are taken. The Legislature must provide an update on the resolutions of the meeting and the progress to the Speaker. The meeting between the relevant stakeholders must be conducted before the end of August 2014.

There have been two meetings at a political level, one between the Speaker and the MEC: Public Works, Roads and Transport and the other between Speaker and MEC: Finance.

The meeting between the Speaker and the MEC for Public Works, Roads and Transport resolved that the Department will prioritise the maintenance of Building 1 and 2 as National Key-Points.

The meeting between the Speaker and the MEC for Finance resolved that the MEC should look at the possibility of transferring the Maintenance Fund to the Legislature.

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3. The DPWRT must develop a policy, in consultation with the Legislature that will address the purchase of furniture for the Members deployed in the provincial government. The policy must look at saving the costs of purchasing furniture every term of the Administration. A progress report on this matter must be submitted to the Legislature before the end of October 2014.

During the Legislature’s interaction with HOD: DPWRT the Legislature was informed that the policy had not been developed yet.

4. The Legislature must submit a progress report on the envisaged feasibility study on the Parliamentary Village after the fi nalisation of same at the end of September 2014.

The Department of Public Works, Roads and Transport indicated their willingness to assist the Legislature provided there is funding for the project.

5. The Legislature must ensure that the align-ment of its organisational structure is fi nal-ised during the 2014/2015 fi nancial year and is ready to be implemented in the 2015/2016 fi nancial year.

The Legislature’s review process has taken into consideration the alignment of the organisational structure and it is now in the process of being approved.

3.8 SCOPA Resolutions

RESOLUTION PROGRESSAppointment of the Secretary to the Legislature

(i) The Speaker must ensure that the position of the Secretary to the Legislature is fi lled on or before 30 September 2014.

(ii) The Speaker must furnish a report to the Legislature on why the vacancy of the Secretary to the Legislature had not been fi lled by 30 April 2013.

(i) The 4th Legislature was unable to conclude the recruitment process at the recommended time.

(ii) This matter was referred to the Speaker of the 4th Legislature and it was felt it could be addressed

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RESOLUTION PROGRESSImplementation of previous SCOPA resolutions

(i) The Speaker must ensure that the Accounting Offi cer implement the 2011/12 SCOPA House Resolutions in full and or be held liable. A progress report in this regard must be furnished to the Committee by 30 August 2014.

(ii) The Speaker must implement the 2011/12 SCOPA House Resolutions. A progress report in this regard must be furnished to the Committee by 30 August 2014.

(i) The Speaker continues to monitor the implementation of all House Resolutions by the Accounting Offi cer.

(ii) It was the decision of the Speaker not to pursue a disciplinary process, instead a reconfi guration, as reported previously, was effected to ensure that qualifi ed opinion is avoided. It is as a result of this reason that the Legislature got successive unqualifi ed opinions in 2012/13 and 2013/14.

Basis for Qualifi cation (2011/12):

(i) The Speaker must take disciplinary action against the accounting offi cer for failure to take disciplinary action against offi cials who failed to disclose complete information on accruals (2011/12).

(ii) The Accounting Offi cer must take disciplinary action against responsible offi cials for the accruals and ensure that accruals are that minimised in the 2012/13 fi nancial year

(i) This matter was responded to in June 2013 and was deliberated with the Committee in February 2014, where it was reported that the Speaker had taken a decision not to institute any disciplinary action for reasons stated in the Committee report.

(ii) In view of the decision of the Speaker on the matter, the Accounting Offi cer has not pursued the matter any further.

Annual Financial Statements, Performance and Annual Report

(i) The Accounting Offi cer must ensure that the Legislature submits complete fi nancial statements to the Auditor General and Treasury as required by Section 55 (i) of FMMPLA and or any other legislation relevant in this regard.

(i) For 2013/14 fi nancial year, the Legislature prepared the fi nancial statements based on the standards of generally recognised accounting practice.

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RESOLUTION PROGRESSBudgets

(i) The Accounting Offi cer must ensure that there was compliance to Section 68 (1) (a) (ii) of the FMMPLA, and or any other legislation relevant in this regard.

(ii) The Accounting Offi cer must ensure that monitoring mechanisms (Internal Controls) put in place are effectively and effi ciently implemented.

(i) Regular interactions are held with management to raise awareness about actions that result in unauthorised, irregular or fruitless and wasteful expenditure.

(ii) The Accounting Offi cer is considering including the implementation of internal controls in performance agreements as key performance areas.

Material Under-spending

(i) The Accounting Offi cer must build internal capacity in the internal audit function of the Legislature.

(i) The Legislature indicated, at the previous hear-ing, that two interns will be appointed. The interns have been appointed as promised. Currently in the process of reviewing our organisational structure to ensure that all sections are fully resourced including Internal Audit section.

Expenditure and Revenue Management

(i) The Accounting Offi cer must ensure that Section 6 (g) of the FMMPLA and or any other legislation relevant in this regard, is adhered to in future.

(ii) The unauthorised expenditures amounting R 1. 082 000.00 is condoned without funding.

(i) Management continues to ensure adherence to Section 6 (g) of FMMPLA

(ii) The condonation of the unauthorised expenditure will be taken onto the accounting books.

Debt Management

(i) The Accounting Offi cer must ensure that all monies owed to the Legislature are collected as required by Section 31 (1) of the FMMPLA and or any other legislation relevant in this regard.

(i) The Accounting Offi cer is ensuring that all monies owed to the Legislature and recoverable, are collected as stipulated in Section 31 (1) of the FMMPLA.

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91

RESOLUTION PROGRESSLeadership

(i) The Accounting Offi cer must instil a culture of re-sponsibility and accountability amongst administra-tion.

(ii) The Speaker must ensure that the Accounting Of-fi cer achieves a clean Audit.

(iii) The Accounting Offi cer must ensure that monthly reports and the fi nancial statements are adequately reviewed prior to submission for audit.

(i) Currently there are management meetings in various levels to ensure that there is continuous accountability by all members of the management.

(ii) The Accounting Offi cer has developed an Audit Outcome Implementation Plan which is monitored on continuous bases, through reports and briefi ngs to the Speaker, and the LSB on the progress thereof.

(iii) Apart from management review, internal auditors with suffi cient experience and qualifi cations in auditing GRAP complaint fi nancial statements will be enlisted to review the year-end fi nancial statements.

Human Resources

(i) The Accounting Offi cer must ensure that a human resource plan is fi nalised and implemented.

(ii) The Accounting Offi cer must ensure that proper training and capacitation in terms of SAP administra-tion is conducted.

(i) The Draft HR Strategy is being fi nalised and approval will be made soon.

(ii) Continuous training on the SAP administration is taking place.

Financial and Performance Management (i) The Accounting Offi cer must ensure that a proper record management and fi ling system is developed for the Legislature.

(ii) The Accounting Offi cer must take disciplinary action against Executive Managers who fail to ensure that their chief directorates timely develop accurate MOV’s.

(i) The records management/registry offi ce is being capacitated to enable it to serve as a robust repository of all the records of the Legislature.

(ii) The Accounting Offi cer has introduced systems to strengthen the reliability and consistency of information in the MOV’s fi les.

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RESOLUTION PROGRESSInternal Controls

(i) The Accounting Offi cer must take disciplinary action against offi cials who fail to conduct daily and monthly reconciliations of transactions (internal controls) and report to the Committee by 30 August 2014.

(ii) The Accounting Offi cer must ensure that this fi nding does not recur in the future.

(iii) The Accounting Offi cer must ensure that the audit action plan is fully implemented.

(i)The Accounting Offi cer had introduced systems to strengthen internal control in relations to fi nancial management, including daily, monthly and quarterly reconciliation of transactions.

(ii) Key reconciliations such as ledger, bank, etc. are performed monthly.

(iii) The implementation

Misstatement – Annual Financial Statements (2012/13)

(i) The Accounting Offi cer must put proper and adequate monitoring systems to verify the accuracy of fi nancial statements and avoid misstatements and/or submission of incomplete fi nancial statements.

(i) Apart from management reviews, further reviews by the internal auditors were included in the audit action plan.

Progress towards achieving Clean audit 2014

(i) The Speaker must integrate the achievement of Clean Audit in the performance agreement of the Accounting Offi cer as a measure to ensure that Legislature leads by example and from the front.

(ii) The Accounting Offi cer must ensure that the six (6) high risk areas as identifi ed by the Auditor General receive priority attention and are addressed without fail.

(i)The Financial management and Performance management functions of the Accounting Offi cer are prescribed by the Financial Management of Mpumalanga Provincial Legislature(whilst applicable), the Financial Management of Parliament Act as Amended and Legislature Service and Administration Act.

An unqualifi ed Audit without matters of emphasis is part of the Generally Recognised Accounting Principle which are imposed by the corporate principles and standards for Accounting Offi cers and thus it inherent upon the deliverables of all Accounting Offi cers

(ii) The audit action plan that has been developed addresses, among others, the six high risk areas.

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3.9 Prior Modifi cations to Audit Reports

The Legislature received an unqualifi ed audit opinion.

3.10 Internal Control Unit

The Legislature maintained a decentralised internal control function where the responsibility for the development and ensuring the implementation of the internal controls rested with the Divisions/Sections of the institution under the leadership of the Secretariat. The Secretariat held meetings where internal control processes within the institution were discussed to ensure reasonable assurance that operations were orderly, ethical, economical, effi cient and effective. The Secretariat further ensured that fi nancial and performance reporting was reliable and in compliance with applicable laws and regulations.

3.11 Internal Audit and Audit Committee

The Accounting Offi cer has ensured that there is an internal audit unit that conducts and coordinates internal audit functions in accordance with the standards set by the Institute of Internal Auditors. The internal audit function ensures oversight by obtaining reasonable assurance regarding management’s assertions that control objectives are met to achieve effectiveness and effi ciency of operations, reliability of fi nancial information, safeguarding of assets, effective information systems environment and compliance with laws and regulations. The internal audit function has also compiled an operating procedure manual, a three year risk based audit and one year operational plan. An Internal Audit Charter was reviewed and implemented during the year under review.

The Internal Audit Section fi nalised the following internal audits during the year under review:

• Financial Statements Audits (Quarter 1, Half-yearly, and 9 months reviews)

• Financial Governance and SCM audit

• Assets and budget management audit (Quarter 1 and 2)

• Performance information (Quarter 2)

• HCM and payroll audit

• Governance, Risk Management and Treasury audit

• Follow-up on previously issued internal and external audit reports

• Ad-hoc review of 2013/14 draft annual fi nancial statements

• Parliamentary Business audit

The internal audit function in the Legislature is co-sourced. Cost curtailment measures within the institution required that some initially planned audits be cancelled during the fi nancial year under review. This therefore necessitated the institution to review the effectiveness and the value-add of the internal audit function in its co-sourcing arrangement. The assessment that was conducted indicated that there is a greater value proposition in shifting from the co-sourced internal audit model to an internal audit structure.

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The Audit Committee was appointed by the Executive Authority. It has approved an Internal Audit Charter which guides the approach and operating procedures for the internal audit function and determines the rules that govern the relationship with the Internal Auditors and the Accounting Offi cer. The table below indicates useful information on the Audit Committee Members:

Table 3.1: Useful information on the Audit Committee Members

Name Qualifi cations and Membership

Internal or external member

If internal, position in the Legislature

Date appointed

Date Resigned

No. of Meetings attended

Ms H Thrush Chartered Accountant (SA)

Registered Accountant and Auditor

Bachelor of Accounting Sciences (Honours)

External n/a 01/10/2011 30/09/2014 3 of 4

Mr A Keyser Matric Member of Institute of Directors

External n/a 01/10/2011 30/09/2014 4 of 4

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95

Ms G Deiner Bachelor of Arts

Bachelor of Accounting Sciences

Higher Diploma in Education- Post Graduate

Professional Accountant (SA) registered with South African Institute of Professional Accoutants

Member of Institute of Directors

External n/a 01/10/2011 n/a 7 of 7

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Ms A Badimo Master of Applied Science

Master of Business Administration

Bachelor of Computer Science Honours

Bachelor of Computer Science

Certifi ed in the Governance of Enterprise IT

Diploma in Project Management

Diploma in Cobol Programming

Member of Institute of Directors


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Mr DK Golding Master of Law in Banking and Finance

Master in International Relations

Baccalaureus Procurationis

Post Graduate Diploma in Macro-economics

Finance for Executives


Ms A Hoosain Bachelor of Jurisprudence

Bachelor of Laws Postgraduate


Mr KM Ramukumba Bachelor of Commerce in Financial Accounting

Bachelor of Commerce in Financial Accounting Honours

Certifi cate in the Theory of Accounting

Chartered Accountant (SA)


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Dr H Jooste Doctor in Business Administration

Master of Business Leadership

Baccalaureus Commercii Honours

Bachelor of Commerce

Member of the Southern African Institute of Directors


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3.12 Audit Committee Report

We are pleased to present our report for the fi nancial year ended 31 March 2015.

Audit Committee Responsibility

The Audit Committee (Committee) has performed its oversight responsibilities. It has operated within its Charter and discharged its duties and responsibilities as contained therein.

The Committee:

• reviewed the 2014/15 annual report and the annual fi nancial statements included herein by management;

• evaluated the included 2014/15 fi nancial statements and annual report of the Legislature for reasonability, completeness and accuracy and recommended these for approval by the Accounting Offi cer;

• reviewed changes in accounting policies and practices and continue to do this as part of an on-going improvement process; and

• reviewed fi nal internal audit reports which had been discussed with management.

Legislative Challenges

The Audit Committee notes the challenges faced by the Mpumalanga Provincial Legislature in respect of the promulgation of the commencement date of the Financial Management of Parliament and Provincial Legislatures Act, 2009 (Act 10. No 10 of 2009).

The Committee advises that the Annual Report (including the Annual Financial Statements) for the 2014/2015 fi nancial year, be read and understood within the context of this legislative gap, and that had there been an applicable legislative framework, there may well have been other issues raised.

The Committee wishes to stress that the Mpumalanga Provincial Legislature has been advised to continue adhering to acceptable governance standards in light of these challenges.

The Effectiveness of Internal Control

The Risk Management Committee was re-confi gured during the year and an independent Chairperson was appointed. While still in its infancy, the Risk Management Committee is functioning reasonably well and reports to the Audit Committee on a quarterly basis. Management regularly presented progress reports on the implementation of the commitments made in response to the Internal and External Auditor’s fi ndings in respect of the Legislature. Areas of concern have been identifi ed and procedures have been proposed by management for addressing the concerns on an on-going basis.

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There is also an ICT Governance Committee which is chaired by an independent Chairperson. It has held meetings during the year and submitted reports to the Audit Committee covering the ICT Governance Framework, ICT strategic plan, IT Audit Action Plan and IT projects. The Internal Audit reports reviewed by the Audit Committee indicated that management did not always implement some of Internal Audit recommendations hence the Audit Committee’s assessment that internal controls are partially effective.

Quality of Financial Management and other Reports

Management submitted quarterly reports on performance and fi nancial information to the Committee. The reports were reviewed by the Committee and were found to be adequate although the Committee made recommendations on some improvement that could be effected on the reports.

Quality of Annual Financial Statements, Performance Reporting and Compliance with Applicable Laws and Regulations

The Committee reports that the quality and timeliness of the fi nancial information in the form of expenditure reports and interim fi nancial statements availed to the Committee for oversight purposes during the year were adequate for the Audit Committee’s purposes. The Committee discussed the unaudited annual fi nancial statements for the 2014/ 2015 fi nancial year on 29 May 2015, and approved same for submission to the Auditor-General South Africa. The Committee further reports that it has faced challenges in receiving timely and quality information and documents for the purpose of considering and discussing the Annual report.

The Committee thus records that it is limited in the comprehensive execution of its statutory obligations including the provisions of relevant assurances, and at this stage has merely conducted a cursory review process. The Committee will continue to monitor and provide advice to ensure improvement in this regard.

Auditor’s Report

We have reviewed the institution’s implementation plan of the audit issues raised in the prior year and we are satisfi ed with the progress made so far.

The Audit Committee has had concerns regarding the application of internal controls, accuracy of fi nancial reporting, and rigour of governance. Management has addressed some of these concerns, but the Committee remains of the view that improvements can still be made.

The Audit Committee concurs and accepts the conclusions of the external auditor on the Annual Financial Statements and is of the opinion that the audited Annual Financial Statements be accepted and read together with the report of the auditor.

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The Audit Committee concurs with the external auditor’s observation about the usefulness and reliability of the predetermined objectives.

_________________

Mr. D. Golding

Chairperson: Audit Committee

Mpumalanga Provincial Legislature

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Part FourHuman Resource

Management

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103

Introduction

The Mpumalanga Provincial Legislature strives to be the employer of choice through the implementation of progressive human capital management policies and strategies. These strategies and policies play an effective role not only in creating a high performance environment but also in supporting the fulfi lment of Legislature’s constitutional mandate and the realisation of the vision of becoming a people-centred, African world class Legislature.

Overview of human resources

The Legislature in the year under review achieved a 90% occupancy rate on Programme 2 (Parliamentary Business). There were only four (4) terminations in the period under review which indicates a reduction in the termination rate when compared with the previous fi nancial year. The priorities for the 2014/15 fi nancial year with regard to Human Capital Management included:

Recruitment and retention which ensured reduction in termination rate;

Training and development through the Legislature bursary administration;

Re-alignment of SAP to ensure data integrity; and

On-going implementation of the human resources strategy

The achievement of the above priorities is an acknowledgement of the efforts of the HCM team in particular and the Legislature management in general. Collectively, we have created a conducive environment for performance.

Our focus for the next fi nancial year (2015/16) is to build on our current success and continue to enhance the implementation of the employee performance management system through advocacy sessions with all stakeholders in the institution. The Legislature will focus on maintaining a healthy and balanced workforce through an effective wellness programme. Furthermore, the Legislature plans to consolidate the management of employee benefi ts to ensure that all benefi ts provided to employees are well communicated. It will also pay attention to occupational health and safety matters which will be underpinned by a robust compliance programme.

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Personnel related expenditureTable 3.1.1 Personnel expenditure by programme for the period 1 April 2014 to 31 March 2015

Programme Total expenditure

(R’000)

Personnel expenditure

(R’000)

Training expenditure

(R’000)

Professional and special

services expenditure

(R’000)

Personnel expenditure

as a % of total expenditure

Average personnel

cost per employee

(R’000)Administration 133 133 35 688

414 5 40726.8 350

Parliamentary Business 155 537 78 858 52.8 1 142

Total 288 670 114 546 414 5 407 40.8 678

Table 3.1.2 Personnel costs by salary band for the period 1 April 2014 to 31 March 2015

Salary band Personnel expenditure

(R000)

% of total personnel

cost

No. of employees

Average personnel cost per employee (R000)

Lower skilled P15-16 1 475 1.3 7 211

Highly skilled production P10-P14 28 966 24.6 86 337

Highly skilled supervision P6 – 9 35 087 29.8 61 575

Senior and top management P3 - 5 25 931 22.0 20 1 297

Statutory 22 315 21.8 19 1 165Contract P15 - 16 (intern) 612 0.5 20 31Periodical remuneration 161 0.1 6 27 TOTAL 114 546 100 219 3 827

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105

Table 3.1.3 – Salaries, overtime, home owners allowance and medical assistance by programme

Programe Salaries Overtime Home owners allowance

Medical assistance

Amount (R’000)

Salaries as a % of

personnel cost

Amount (R’000)

Overtime as a % of

personnel cost

Amount (R’000)

HOA as a % of

personnel cost

Amount (R’000)

Medical assis

Programme 1: Adminis-tration

44 233 55.35 808 68.6 1 524 53.0 3 006 64.3

Programme 2: Parlia-mentary Business

35 688 44.65 369 31.4 1 354 47.0 1 668 35.7

Total 79 920 100 1 178 100 2 878 100 4 674 100

Table 3.1.4 – Salaries, overtime, home owners allowance and medical assistance by salary levels

Salary levels

Salaries Overtime Home owners allowance

Medical assistance

Amount (R’000)

Salaries as a % of

personnel cost

Amount (R’000)

Overtime as a % of

person-nel cost

Amount (R’000)

HOA as a % of

personnel cost

Amount (R’000)

Medical assis

P15- P16 1 168 1.46 36 3.1 159 5.5 112 2.4P10 - P14 24 406 30.53 777 66.0 1 856 64.5 1 946 41.6P8 – P9 17 262 21.60 364 30.9 863 30.0 762 16.3P6 – P7 17 072 21.36 - - - - 593 12.7P3 - P5 20 011 25.04 - - - - 1 261 27.0Total 79 920 100 1 178 100 2,878 100 4 674 100

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3.2 Employment and vacancies

Table 3.2.1 Employment and vacancies by programme for the period 1 April 2014 to 31 March 2015

Programme Number of posts

Number of posts fi lled

Vacancy Rate

%

Number of posts fi lled additional to the

establishmentStatutory 19 19 0 0

Programme 1: Administration

136 103 24 0

Programme 2: Parliamentary Business

79 72 9 0

Total 234 194 17 0

Table 3.2.2 Employment and vacancies by salary band for the period 1 April 2014 to 31 March 2015

Salary band Number of posts

Number of posts fi lled

Vacancy Rate

%

Number of posts fi lled additional to the

establishmentLower skilled (P15-P16) 8 7 13 0Skilled

(P10-P14)

104 87 16 0

Highly skilled production

(P8-P9)

46 32 31 0

Highly skilled supervision (P6-P7)

36 29 17 0

Senior management

(P3-5)

21 20 10 0

Contract permanent 0 0 0Members 19 19 0 0Total 234 194 17 0

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Table 3.2.3 Employment and vacancies by critical occupations for the period 1 April 2014 to 31 March 2015

Critical occupations Number of posts

Number of posts

fi lled

Vacancy rate

Number of posts fi lled additional to the establishment

Administrative related 56 45 22 0Cleaners in offi ces workshops hospitals 6 6 0 0Communications and information related 15 6 60 0Financial clerks 6 4 34 0Secretary to the Legislature 1 0 100 0Human resources clerks 2 2 0 0Human resources related 9 6 34 0Librarians and related clerks 2 2 0 0Light vehicle drivers 4 4 0 0Messengers porters and delivers 2 2 0 0Other administrative (Managers) 36 28 23 0Other administrative policy and related offi cers 16 12 25 0Other occupations 19 19 0 0Secretaries and other keyboard operating clerks 39 39 0 0Senior management 21 19 10 0Total 234 194 17 0

3.3 Filling of SMS postsTable

3.3.1 SMS post information for the period 1 April 2014 to 31 March 2015

SMS level Total number

of funded SMS posts

Total number of SMS posts

fi lled

% of SMS posts fi lled


vacant

% of SMS posts vacant

Senior management (P3-P5) 4 0 0 2 50

Highly skilled (P6- P7) 9 0 0 5 56Total 13 0 0 7 54

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Table 3.3.2 SMS post information for the period 1 April 2014 to 31 March 2015

SMS Level Total number of funded

SMS posts


fi lled



vacant

% of SMS posts vacant

Senior management (P3-P5) 4 2 50 2 50Highly skilled (P6- P7) 16 5 31 11 69Total 20 7 35 7 65

Table 3.3.3 Advertising and fi lling of SMS posts for the period 1 April 2014 to 31 March 2015

SMS level Total number of funded SMS posts

Total num-ber of SMS posts fi lled


Total number of SMS

posts vacant

% of SMS posts

vacant

Senior management (P3-P5)

4 2 50 2 50

Highly skilled (P6- P7) 16 5 25 11 69Total 20 7 30 13 65

Table 3.3.4 Reasons for not having complied with the fi lling of funded vacant SMS - advertised within 6 months and fi lled within 12 months after becoming vacant for the period 1 April 2014 to 31 March 2015

Reasons for vacancies not advertised within six monthsAll positions were advertised within six months of being vacant or funded.

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109

Reasons for vacancies not fi lled within six monthsThe position not fi lled within the six months period was due to various reason: applicants not meeting the requirements, very few applications received or a limited pool of applicants received for these positions and some had to be re-advertised namely: - ERP Administrator position, The Secretary to the Legislature, Executive Manager: Parliamentary Business, Manager: Treasury, Manager: Document Management, Sergeant at Arms and Manager: Production and Content Management.

Table 3.3.5 Disciplinary steps taken for not complying with the prescribed timeframes for fi lling SMS posts within 12 months for the period 1 April 2014 to 31 March 2015

Reasons for vacancies not advertised within six monthsNot applicable

Reasons for vacancies not fi lled within six monthsAs stated on table 3.3.4

3.4 Job evaluation

Table 3.4.1 Job Evaluation by salary band for the period 1 April 2014 to 31 March 2015

None

Table 3.4.2 Profi le of employees whose positions were upgraded due to their posts being upgraded for the period 1 April 2014 to 31 March 2015

None

Table 3.4.3 Employees with salary levels higher than those determined by job evaluation by occupation for the period 1 April 2014 to 31 March 2015

None

Table 3.4.4 Profi le of employees who have salary levels higher than those determined by job evaluation for the period 1 April 2014 to 31 March 2015

None

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3.5 Employment changes

Table 3.5.1 Annual turnover rates by salary band for the period 1 April 2014 to 31 March 2015

Salary level Number of employees per

band as on 1 April 2014

Appointments and transfers

into the legislature

Terminations and transfers

out of the legislature

Number of employees

per band at 31 March 2015

Turnover rate

Unskilled (P15-P16) 8 0 0 7 0

Skilled (P10-P14) 76 13 3 86 4

Highly skilled production(P8-P9))

30 2 1 32 3

Highly skilled supervision(P6-P7)

26 5 0 29 0


17 2 0 20 0

Members 19 - - 19 -

Total 176 22 4 194 3

* Members annual turnover statistics

Salary level Number of members per band as on 1

April 2014



Terminations and transfers

out of the legislature

Number of employees per

band at 31 March 2015

Turnover rate

Members 19 13 13 19 69%

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Table 3.5.2 Annual turnover rates by critical occupation for the period 1 April 2014 to 31 March 2015

Occupation: Number of employees per occupation as

on 1 April 2014



Terminations and transfers out of the

legislature

Turnover rate

%

Administrative related

44 6 3 7

Cleaners in offi ces workshops hospitals

6 0 0 0

Client inform clerks (switchboard operator)

2 1 0 0

Communications and information related

7 0 0 0

Financial clerks 4 0 0 0


0 0 0 0

Human resources clerks

2 0 0 0

Human resources related

4 0 0 0

Librarians and related clerks

2 0 0 0

Light vehicle drivers

4 0 0 0

Messengers porters and delivers

2 0 0 0

Other administrative (Managers)

26 5 0 0

Other administrative policy and related offi cers

6 0 0 0

Other occupations 19 - - 0

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Occupation: Number of employees per occupation as

on 1 April 2014



Terminations and transfers out of the

legislature

Turnover rate

%

Secretaries and other keyboard operating clerks

31 8 1 4

Senior management

17 2 0 0

Total 176 22 4 3

Interns 0 20 0 0

Table 3.5.3 Reasons why staff left the Legislature for the period 1 April 2014 to 31 March 2015

Termination type Number % of totalDeath 0 0Resignation 4 3Expiry of contract 0 0Dismissal – operational changes 0 0Dismissal – misconduct 0 0Dismissal – ineffi ciency 0 0Discharged due to ill-health 0 0Retirement 0 0Transfers to Public Service Departments/Parliament 0 0Total 4 3*Note:- 19 members were terminated during the elections and 13 members appointed and 6 re-appointedTotal number of personnel who left as a 3% of the total employment

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Table 3.5.4 Promotions by critical occupation for the period 1 April 2014 to 31 March 2015

OccupationEmployees

as at 31 March 2015

Promotions to another

salary level

Salary level promotions

as a % of employees by

occupation

Progressions to another notch within a salary

level

Notch progressions


occupationUnskilled (P15-P16) 7 0 0 0 0

Skilled (P10-P14) 87 4 5 0 0

Highly skilled production (P8-P9)

32 4 13 0 0


30 0 0 0 0


19 1 6 0 0

Members 19 0 0 0 0

Total 194 9 5 0 0

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Table 3.5.5 Promotions by salary band for the period 1 April 2014 to 31 March 2015

Salary bandEmployees

31 March 2015

Promotions to another

salary level

Salary levels promotions


salary level

Progressions to another notch within a salary

level

Notch progressions


salary bandUnskilled (P15-P16)

7 0 0 0 0

Skilled (P10-P14) 87 4 5 0 0Highly skilled production(P8-P9)

32 4 13 0 0

Highly skilled supervision(P6-P7)

30 0 0 0 0


19 1 6 0 0

Members 19 0 0 0 0Total 194 9 5 0 0

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3.6 Employment Equity

Table 3.6.1 Total number of employees (including employees with disabilities) in each of the following occupational categories for the period 1 April 2014 to 31 March 2015

Occupational categories

Male Female TotalAfrican Coloured Indian White African Coloured Indian White

Senior management

10 1 0 1 7 1 0 0 20

Professional qualifi ed (managers)

17 0 0 0 12 0 0 0 29

Academically qualifi ed (Junior management and supervisory)

15 0 0 1 15 0 0 1 32

Semi-skilled and discretionary decision making

30 0 0 0 55 1 1 1 88

Unskilled 1 0 0 0 6 0 0 0 7

Total 72 1 0 2 96 2 1 2 176

Employees with disabilities

2 0 0 1 0 0 0 0 3

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Table 3.6.2 Total number of employees (including employees with disabilities) in each of the following occupational bands for the period 1 April 2014 to 31 March 2015

Occupational levels

Male FemaleAfrican Coloured Indian White African Coloured Indian White Total

Top Management

(P3-P4)

2 0 0 0 0 0 0 0 2

Senior management (P5)

8 1 0 1 7 1 0 0 18

Professionally qualifi ed and experienced specialists and mid-management

(P6-P7)

17 0 0 0 12 0 0 0 29

Skilled technical and academically qualifi ed workers, junior management, supervisors, foreman and superintendents

(P8-P9)

15 0 0 1 15 0 0 1 32


(P10-P14)

30 0 0 0 55 1 1 1 88

Unskilled and defi ned decision making (P15-P16)

0 0 0 0 7 0 0 0 7

Total 72 1 0 2 96 2 1 2 176

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Table 3.6.3 Recruitment for the period 1 April 2014 to 31 March 2015

Occupational levels


Top management (P3-P4)

0 0 0 0 0 0 0 0 0

Senior management (P5 )

0 0 0 0 1 1 0 0 2

Professionally qualifi ed and experienced specialists and mid-management (P6-P7)

2 0 0 0 3 0 0 0 5

Skilled technical and academically qualifi ed workers, junior management, supervisors, foreman and superintendents (P8-P9)

1 0 0 0 1 0 0 0 2


(P10-P14)

5 0 0 0 8 0 0 0 13

Unskilled and defi ned decision making

P15-P16)

0 0 0 0 0 0 0 0 0

Total 7 0 0 0 13 1 0 0 22

Interns 7 0 0 0 13 0 0 0 20


0 0 0 0 0 0 0 0 0

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Table 3.6.4 Promotions for the period 1 April 2014 to 31 March 2015

Occupational levels



0 0 0 0 0 0 0 0 0


0 0 0 0 1 0 0 0 1


0 0 0 0 0 0 0 0 0


3 0 0 0 0 0 0 1 4

Semi-skilled and discretionary decision making (P10-P14)

2 0 0 0 2 0 0 0 4


0 0 0 0 0 0 0 0 0

Total 5 0 0 0 3 0 0 1 9


0 0 0 0 0 0 0 0 0

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Table 3.6.5 Terminations for the period 1 April 2014 to 31 March 2015

Occupational levels



0 0 0 0 0 0 0 0 0


0 0 0 0 0 0 0 0 0


0 0 0 0 0 0 0 0 0


1 0 0 0 0 0 0 0 1

Semi-skilled and discretionary decision making (P10-P14)

2 0 0 0 1 0 0 0 3


0 0 0 0 0 0 0 0 0

Total 3 0 0 0 1 0 0 0 4


0 0 0 0 0 0 0 0 0

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Table 3.6.6 Disciplinary action for the period 1 April 2014 to 31 March 2015

Male Female

African Coloured Indian White African Coloured Indian White TotalDisciplinary action

0 0 0 0 0 0 0 0 0

Table 3.6.7 Skills development for the period 1 April 2014 to 31 March 2015

Occupational categories


Senior offi cials and managers

3 0 0 0 15 0 0 0 18

Professionals 8 0 0 0 12 0 0 0 20

Technicians and associate professionals

12 0 0 0 13 0 0 0 25

Clerks 6 0 0 0 22 0 0 0 28

Elementary occupations

0 0 0 0 5 0 0 0 5

Total 29 0 0 0 67 0 0 0 96Employees with disabilities

1 0 0 0 0 0 0 0 1

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3.7 – Performance rewards

Table 3.7.1 Performance rewards by race, gender and disability for the period

1 April 2014 to 31 March 2015

Benefi ciary profi le

Number of benefi ciariesTotal number of

employees in group

% of total within group

African, Female 36 96 38

African, Male 51 72 73

Indian Female 1 1 100

Coloured Female 1 2 50

Coloured Male 0 1 0

White Female 2 2 100

White Male 1 2 50

Total, Blacks, Female 36 96 38

Total Blacks, Male 51 72 73

Total White Female 2 2 100

Total Indian Female 1 1 100

Total Coloured Fe-male

1 2 50

Total Coloured Male 0 1 0

Total White Male 1 2 50

Total 94 176 54


2 3 67

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Table 3.7.2 Performance rewards by salary band for personnel below SMS for the period 1 April 2014

Salary levels Benefi ciary profi le CostNumber of

benefi ciariesNumber of employees

% of total within salary levels

Total cost

(R’000)

Average cost per

employee

(R’000)

Total cost as a % of the total

personnel expenditure

Unskilled(P15-P16) 6 8 75 29 4 2

Semi-skilled (P10-P14)

51 87 60 497 10 2

skilled production (P8-P9)

18 32 57 303 17 2


13 29 45 267 205 2


6 18 34 196 33 1


0 2 0 0 0 0

Total 94 176 53 1 291 14 2

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Table 3.7.3 Performance Rewards by critical occupation for the period 1 April 2014 to 31 March 2015

Critical occupations Benefi ciary profi le Cost

Number of benefi ciaries

Number of employees

% of total within

occupation

Total cost (R’000)

Average cost per employee

(R’000)Administrative related

27 45 62.79 349 13

General assistants

4 7 66.67 19 5

Client inform clerks (switchboard operator)

1 2 50 8 8

Communications and information related

2 5 40 33 16

Financial clerks 6 7 85.71 88 15


0 0 0 0 0

Human resources clerks

1 2 50 9 9

Human resources related

1 4 25 23 23

Librarians and related clerks

1 2 50 13 13

Light vehicle drivers

4 4 100 31 8

Messengers porters and delivers

2 2 100 10 5

Other administrative

8 66.7 100 12

Other administrative policy and related offi cers (Managers)

13 30 46.4 267 21

Secretaries and other keyboard operating clerks

20 39 51.3 146 7

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Critical occupations Benefi ciary profi le Cost

Number of benefi ciaries

Number of employees

% of total within

occupation

Total cost (R’000)

Average cost per employee

(R’000)Senior managers

6 18 33.3 196 33

Total 94 176 53 1 291 14

Table 3.7.4 Performance related rewards (cash bonus), by salary band for SMS for the period 1 April 2014 to 31 March 2015

Salary level Benefi ciary profi leNumber of

benefi ciaries Number of employees % of total within level

P3-P5 6 20 30

P6-P7 13 28 47

Total 19 48 40

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3.8 Foreign workers

3.8.1 – Foreign workers by salary band

None

3.8.2 – Foreign worker by major occupation

None

3.9 Leave utilisation

Table 3.9.1 Sick leave for the period 1 April 2014 to 31 March 2015

Salary band Total days

% days with medical

certifi cation

Number of em-ployees using

sick leave

% of total employees

using sick leave

Average days per employee

Skilled (P10-P16) 987 28 62 69.7 11.0

Highly skilled production (P8-P9)

483 14 27 77.1 13.4


208 16 21 75,0 6.9


86 6 9 45,0 4.3

Total 1 764 64 119 266.8 14.8

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Table 3.9.2 Disability leave (temporary and permanent) for the period 1 April 2014 to 31 March 2015

None

Table 3.9.3 Annual leave for the period 1 April 2014 to 31 March 2015

Salary levels Total days taken Average per employeeSkilled ((P10-P16)) 1 425 15.8

Highly skilled production (P8-P9) 639 17.8

Highly skilled supervision P6-P7) 531 18.0

Senior management (P3-P5) 383 19.2

Total 2 978 17.0

Table 3.9.4 Capped leave for the period 1 April 2014 to 31 March 2015

No employee utilised capped leave during the year under review.

Table 3.9.5 Leave pay-outs for the period 1 April 2014 to 31 March 2015

ReasonTotal amount

(R’000)Number of employees

Average payment per employee

(R’000)Leave pay-out for 2014/15 due to non-utilisation of leave for the previous cycle

0 0 0

Capped leave pay-outs on termination of service for 2014/15

36 1 36

Current leave pay-out on termination of service for 2014/15

27 1 27

Total 63 2 32

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3.10 HIV/AIDS & Health promotion programmes

Table 3.10.1 Steps taken to reduce the risk of occupational exposure

Units/categories of employees identifi ed to be at high risk of contracting HIV & related diseases (if any)

Key steps undertaken to reduce the risk

There are preventative and educational measures that have been undertaken

• Condom canisters have been installed in all Legislature toilets and periodically replenished

• Campaigns for HIV/AIDS awareness were held

Table 3.10.2 Details of health promotion and HIV/AIDS programmes

Question Yes No Details, if yes1. Has the Legislature designated a Senior Manager to implement health promotion and HIV and Aids programmes? If so, provide her/his name and position.

√ Senior Manager: HCM

Ms. Claudia Qwabe

2. Does the Legislature have a dedicated unit or has it designated specifi c 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.

√ Two employee dedicated

3. Has the Legislature introduced an employee assistance or health promotion programme for your employees? If so, indicate the key elements/services of this programme.

√ Education

Counselling

Professional referrals

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Question Yes No Details, if yes4. Has the Legislature established a wellness committee(s)? If so, please provide the names of the members of the committee and the stakeholder(s) that they represent.

√ N.C. Qwabe

J.M. Mayenjane

C. Williams

T.S. Sindane

Z.C. Memela-Gamede

P.M. Kola

S.R. Ntsele

5. Has the Legislature reviewed its employment 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.

√ Employee Assistance Program Policy Ap-proved

Draft Sexual Harassment

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

√ The measures are stipulated on the HIV/AIDS policy

7. Does the Legislature encourage its employees to undergo Voluntary Counselling and Testing? If so, list the results that you have you achieved.

√ Employees attended a two session of VCT

Health commemoration of World AIDS Day

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

√ To be developed

Introduce sporting code * soccer, netball, ath-letes, golf, etc.

3.11 Labour relations

Table 3.11.1 Collective agreements for the period 1 April 2014 to 31 March 2015

Subject Matter DateSalary agreement 25 April 2014

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129

Table 3.11.2 Misconduct and disciplinary hearings fi nalised for the period 1 April 2014 to 31 March 2015

Outcomes of disciplinary hearings Number % of totalSuspended with pay 0 0Total 0 0Disciplinary hearings – 2014/15

Table 3.11.3 Types of misconduct addressed at disciplinary hearings for the period 1 April 2014 to 31 March 2015

Type of misconduct Number % of totalPerformance-related 0 0Dishonesty 0 0Total 0 0

Table 3.11.4 Grievances logged for the period 1 April 2014 to 31 March 2015

Number % of TotalNumber of grievances resolved 4 2.3Number of grievances not resolved 0 0Total number of grievances lodged 4 2.3

Table 3.11.5 Disputes logged with councils for the period 1 April 2014 to 31 March 2015

Number % of TotalNumber of disputes upheld 0 0Number of disputes dismissed 0 0Number of disputes settled (agreement by both parties) 2 1.1Total number of disputes lodged 2 1.1

Table 3.11.6 Strike actions for the period 1 April 2014 to 31 March 2015

None

Table 3.11.7 Precautionary suspensions for the period 1 April 2014 to 31 March 2015

Number of people suspended 0Number of people whose suspension exceeded 30 days 0Average number of days suspended 0Cost (R’000) of suspension 0

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3.12 Skills development

Table 3.12.1 Training needs identifi ed for the period 1 April 2014 to 31 March 2015

Occupation Gender Employees Identifi ed

for bursaries

Internship Skills programme

& other courses

Other forms of training

Total

Male Female

Senior offi cials and Managers

3 16 6 0 1 0 19

Professionals 8 14 2 0 2 0 22

Technicians and associate professionals

12 11 7 0 0 0 23

Clerks 4 17 1 20 0 0 21

Service and sales workers

0 0 0 0 0 0 0

Skills agriculture and fi shery workers

0 0 0 0 0 0 0

Craft and related trades workers

0 0 0 0 0 0

Plant and machine operators & assemblers

3 0 0 0 0 0 3

Elementary occupation

0 1 1 0 0 0 2

Total 30 59 17 20 3 0 89

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131

Table 3.12.2 Training provided for the period 1 April 2014 to 31 March 2015

Occupation Gender Employees with

Bursaries

Internship Skills programme & other courses

Other forms of training

Total

Male Female

Senior offi cials and Managers

16 15 6 0 1 0 31

Professionals 8 12 2 0 2 0 20Technicians and associate professionals

12 13 7 0 0 0 25

Clerks 6 22 1 20 0 0 28Service and sales workers

0 0 0 0 0 0 0

Skills agriculture and fi shery workers

0 0 0 0 0 0 0

Craft and related trades workers

0 0 0 0 0 0 0

Plant and machine operators & assemblers

2 0 1 0 0 0 2

Elementary occupation

0 5 1 0 0 0 5

Total 44 67 15 20 3 0 111

Table 3.13.1 Injury on duty for the period 1 April 2014 to 31 March 2015

None

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Part FiveFinancial

Information

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133

Accounting Offi cer’s Statement of Responsibility for Annual Financial Statements

The Accounting Offi cer has compiled the annual report with annual fi nancial statements for the year ended 31 March 2015 which have been prepared in accordance with the standards of generally recognised accounting practice. The annual report among other things:

• provides a record of the activities of the Legislature during the fi nancial year to which the report relates;

• promotes accountability for decisions made during the year by the Legislature;

• contains the annual fi nancial statements of the Legislature for the 2014/15 fi nancial year as submitted to the Auditor-General;

• contains explanations that may be necessary to clarify the fi nancial statements;

• contains the Auditor-General’s audit report on the fi nancial statements;

• contains particularities of corrective action taken or to be taken in response to issues raised in the audit report; and

• contains the report of the Audit Committee which refl ects on the annual fi nancial statements.

In line with the above mentioned elements contained in part fi ve of the annual report, the Accounting Offi cer has performed his responsibilities for annual fi nancial statements. It is the opinion of the Accounting Offi cer that the annual fi nancial statements fairly represent the state of fi nancial affairs at the Mpumalanga Provincial Legislature for the fi nancial year ended 31 March 2015.

_________________

Mr. L.J. Mwale


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Report of the Auditor-General to the Mpumalanga Provincial Legislature on Vote No. 2: Mpumalanga Provincial Legislature

Report on the fi nancial statement s

Introductio n

1. I have audited the fi nancial statements of the Mpumalanga Provincial Legislature set out on pages 138 to 209 , which comprise the statement of fi nancial position as at 31 March 2015, the statement of fi nancial performance, statement of changes in net assets, cash fl ow statement and statement of comparison of budget and actual amounts for the year then ended, as well as the notes, comprising a summary of signifi cant accounting policies and other explanatory information.

Accounting offi cer’s responsibility for the fi nancial statements

2. The accounting offi cer is responsible for the preparation and fair presentation of these fi nancial statements in accordance with the South African Standards of Generally Recognised Accounting Practice (SA Standards of GRAP), a nd for such internal control as the accounting offi cer determines is necessary to enable the preparation of fi nancial statements that are free from material misstatement, whether due to fraud or error.

A uditor-general’s responsibility

3. My responsibility is to express an opinion on these fi nancial statements based on my audit. I conducted my audit in accordance with International Standards on Auditing. Those standards require that I comply with ethical requirements, and plan and perform the audit to obtain reasonable assurance about whether the fi nancial statements are free from material misstatement.

4. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the fi nancial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the fi nancial 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 fi nancial 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 fi nancial statements.

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

O pinion

6. In my opinion, the fi nancial statements present fairly, in all material respects, the fi nancial position of the Mpumalanga Provincial Legislature as at 31 March 2015 and its fi nancial performance and cash fl ows for the year then ended, in accordance with the S A Standards of GRAP.

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135

Emphasis of matters

7. I draw attention to the matters below. My opinion is not modifi ed in respect of these matters.

Transitional provision for legislatures

8. Legislatures are not required to measure property, plant and equipment for the reporting periods beginning on or after a date within three years following the date of the initial adoption of the SA Standard of GRAP on property, plant and equipment. As disclosed in note 6 to the fi nancial statements and paragraph 1.1 of the accounting policies, the legislature has taken advantage of the transitional provision in accordance with paragraph 28 of directive 8.

Restatement of corresponding fi gures

9. As disclosed in note 35 to the fi nancial statements, the corresponding fi gures for 31 March 2014 have been restated as a result of an error discovered during the year ended 31 March 2015 in the fi nancial statements of the legislature at, and for the year ended, 31 March 2014.

Additional matter

10. I draw attention to the matter below. My opinion is not modifi ed in respect of this matter.

Legislative environment

11. For the period 1 April 2014 to 31 March 2015, there is no legislation applicable to provincial legislatures regulating their fi nancial management. In a judgement on 22 March 2012, the Constitutional Court ruled that all fi nancial management acts of provincial legislatures were unconstitutional because legislatures did not have the mandate to legislate in the area of fi nancial management. According to the court, this function resided with Parliament. The court suspended the declarations of invalidity and requested Parliament to remedy the defect. Parliament fi led a request for extension ending 1 April 2014, which was granted by the Constitutional Court. The Financial Management of Parliament and Provincial Legislatures Act of South Africa, 2009 (Act No. 10 of 2009) was amended to deal with the fi nancial management of both Parliament and the provincial legislatures. The Financial Management of Parliament Amendment Act of South Africa, 2014 (Act No. 34 of 2014) was approved by the President on 1 September 2014 and announced that the date of implementation would be 1 April 2015.

Report on other legal and regulatory requirements

12. In accordance with the Public Audit Act of South Africa, 2004 (Act No. 25 of 2004) (PAA) and the general notice issued in terms thereof, I have a responsibility to report fi ndings on the reported performance information against predetermined objectives for selected programmes presented in the annual performance report, non-compliance with legislation as well as internal control. The objective of my tests was to identify reportable fi ndings as described under each subheading but not to gather evidence to express assurance on these matters. Accordingly, I do not express an opinion or conclusion on these matters.

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Predetermined objectives

13. I performed procedures to obtain evidence about the usefulness and reliability of the reported performance information for the following selected programme presented in the annual performance report of the legislature for the year ended 31 March 2015:

• Programme 2: parliamentary business, on pages 63 to 80

14. I evaluated the reported performance information against the overall criteria of usefulness and reliability.

15. I evaluated the usefulness of the reported performance information against the process and procedure manual for the management of programme performance. I further performed tests to determine whether indicators and targets were well defi ned, verifi able, specifi c, measurable, time bound and relevant.

16. I assessed the reliability of the reported performance information to determine whether it was valid, accurate and complete.

17. I did not identify any material fi ndings on the usefulness and reliability of the reported performance information for the following programme:

• Programme 2: parliamentary business

Additional matters

18. Although I raised no material fi ndings on the usefulness and reliability of the reported performance information for the selected programme, I draw attention to the following matters:

Achievement of planned targets

19. Refer to the annual performance report on pages 23 to 80 for information on the achievement of the planned targets for the year.

A djustment of material misstatements

20. I identifi ed material misstatements in the annual performance report submitted for auditing on the reported performance information for the parliamentary business programme. As management subsequently corrected the misstatements, I did not raise any material fi ndings on the usefulness and reliability of the reported performance information.

Compliance with l egislation

21. I performed procedures to obtain evidence that the legislature had complied with legislation applicable to procurement and contract management. I was unable to perform compliance procedures regarding other fi nancial matters, fi nancial management and other related matters, as the legislature does not have legislation regulating its fi nancial management.

Internal control

22. I considered internal control relevant to my audit of the fi nancial statements and annual performance report. The matters reported below are limited to the signifi cant internal control defi ciencies that resulted in material adjustments to the annual fi nancial statements and the annual performance report.

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Leadership

23. The accounting offi cer did not adequately review the fi nancial statements prior to their submission.

24. Key positions were vacant for a signifi cant period.

25. The legislature developed a plan to address internal and external audit fi ndings, but the appropriate level of management did not timeously monitor adherence to the plan.

Financial and performance management

26. Controls over daily and monthly processing and reconciling of transactions were not effective throughout the period.

27. The fi nancial statements contained numerous misstatements, mainly due to staff members not fully understanding the requirements of the SA Standards of GRAP. These misstatements were subsequently corrected.

28. The annual performance report contained misstatements, mainly due to staff members not thoroughly reviewing some of the performance information (mode of verifi cation) fi les prior to reporting on the achievement or non-achievement of specifi c targets.

Other reports

Investigations

29. The legislature instituted an investigation at the end of the 2014-15 fi nancial year. The investigation was initiated based on an allegation of possible inappropriate procurement. These proceedings are currently in progress.

Mbombela

31 July 2015

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STATEMENT OF FINANCIAL POSITION AS AT 31 MARCH 2015

ActualNote 31 March 2015 31 March 2014

RestatedR R

AssetsCurrent assetsInventories 2 283 742 221 464Receivables from non-exchange transactions 3 374 129 578 060Prepayments 4 3649 342 2 146 218Cash and cash equivalents 5 2 462 119 2 036 521

6 769 332 4 982 263Non-current assetsProperty, plant and equipment 6 14 925 343 14 548 705Intangible assets 7 15 727 190 15 760 616Receivables from non-exchange transactions 8 65 772

30 718 305 30 309 321Total assets 37 487 637 35 291 584LiabilitiesCurrent liabilitiesProvisions 9 4 737 497 4 009 497Payables from exchange transactions 10 7 595 246 17 633 938Payables from non-exchange transactions 11 9 358 869 8 350 748Operating lease liabilities 12 842 898 1 295 031 22 534 510 31 289 214Non-current liabilitiesProvisions 9 2 364 000 2 956 000Total liabilities 24 898 510 34 245 214

Net assets 12 589 127 1 046 370Accumulated surplus 13 12 589 127 1 046 370

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STATEMENT OF FINANCIAL PERFORMANCE FOR THE PERIOD ENDED 31 MARCH 2015


Restated R R

RevenueRevenue from non-exchange transactionsAnnual appropriation 14 267 324 000 229 282 000Statutory appropriation 15 23 797 000 22 123 000Public contributions and donations 16 250 000 100 939Sundry revenue 17 637 005 166 391Revenue from exchange transactionsSundry revenue 17 9 196 13 920Interest earned 18 755 814 538 646Total Revenue 292 773 015 252 224 896ExpenditureEmployee related costs 19 (114 546 455) (102 885 528)Depreciation and amortisation 20 (4 052 024) (3 986 752)Impairment of assets 21 0 (197 997)Debt impairment 22 (449 524) (493 558)Repairs and maintenance (106 690) (330 003)Contracted services 23 (62 765 850) (51 467 650)Transfer payments 24 (37 857 698) (37 154 640)General expenses 25 (59 830 616) (64 714 912)Total expenditure (279 608 857) (261 231 040)Loss on disposal of assets (107 929) (662 548)Surplus/ (defi cit) for the year 13 056 229 (9 668 692)

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STATEMENT OF CHANGES IN NET ASSETS FOR THE PERIOD ENDED 31 MARCH 2015

Description Total for accumulated

Surplus/(Defi cit

Account)

Total

R R

Opening balance as previously reported 15 988 487 15 988 487AdjustmentsCorrection of error 564 575 564 575Balance at 01 April 2013 as restated 16 553 062 16 553 062Changes in net assets Surplus for the year (9 668 692) (9 668 692)Correction of error (3 267 000) (3 267 000)Transfers to Treasury for re-appropriation (2 571 000) (2 571 000)Total changes (15 506 692) (15 506 692)Opening balance as previously reported 5 684 322 5 684 322AdjustmentsCorrection of errors (4 637 952) (4 637 952)Restated balance at 01 April 2014 as restated 1 046 370 1 046 370Changes in net assetsSurplus for the year 13 056 229 13 056 229Transfers to Treasury for re-appropriation (1 513 472) (1 513 472)Total changes 11 542 757 11 542 757 Balance at 31 March 2015 12 589 127 12 589 127

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CASH FLOW STATEMENT FOR THE PERIOD ENDED 31 MARCH 2015


RestatedR R

Cash fl ows from operating activitiesReceiptsPublic contributions and donations 250 000 100 939Annual appropriation and other receipts 290 018 484 249 578 756Interest earned 755 814 579 705PaymentsEmployee related costs (114 410 455) (100 744 860)Suppliers (132 248 138) (105 354 042)Transfer payments (37 857 698) (37 154 640)Net cash fl ows from operating activities 26 6 508 007 7 005 858Cash fl ows from investing activitiesPurchase of property, plant and equipment (4 362 630) (2 324 485)Proceeds from sale of property, plant and equipment

271 750 338 001

Purchase of other intangible assets (412 285) (2 631 545)Increase on non-current trade receivables (65 772) 0Net cash fl ows from investing activities (4 568 937) (4 618 029)Cash fl ows from fi nancing activitiesTransfers to Treasury for re-appropriation (1 513 472) (2 571 000)Net increase/(decrease)in cash and cash equivalents

425 598 (183 171)

Cash and cash equivalents at the beginning of the year

2 036 521 2 219 692

Cash and cash equivalents at the end of the year 2 462 119 2 036 521

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STATEMENT OF COMPARISON OF BUDGET AND ACTUAL AMOUNTS FOR THE YEAR ENDED 31 MARCH 2015

Budget on cash basis Approved budget

Budget Adjustments

Final Budget Actual Difference between

fi nal budget and actual

Variance percentage

R R R R R RStatement of Financial PerformanceRevenueRevenue from exchange transactionsSundry revenue 0 0 0 9 196 9 196 (100%)Interest earned 0 0 0 755 814 755 814 (100%)Total revenue from exchange transactions

0 0 0 765 010 765 010

Revenue from non- exchange transactionsRevenueAnnual appropriation 267 324 000 0 267 324 000 267 324 000 0 0%Transfer revenuePublic contributions and donations

0 0 0 250 000 250 000 (100%)

Statutory appropriation 23 797 000 0 23 797 000 23 797 000 0 0%Sundry revenue 0 0 0 637 005 637 005 (100%)Total revenue from non-exchange transactions

291 121 000 0 291 121 000 292 008 005 887 005

291 121 000 0 291 121 000 292 773 015 1 652 015ExpenditureEmployee related costs (124 212 000) 8 304 000 (115 908 000) (114 546 455) 1 361 545 1.17%Depreciation and amortisation

0 0 0 (4 052 024) (4 052 024) (100%)

Debt impairment 0 0 0 (449 524) (449 524) (100%)Repairs and maintenance (295 000) 0 (295 000) (106 690) 188 310 63.8%Contracted services (52 781 708) (4 944 000) (57 725 708) (62 765 850) (5 040 142) 8.73%Transfer payments (38 068 000) 0 (38 068 000) (37 857 698) 210 302 0.55%General expenses (59 968 292) (3 024 000) (62 992 292) (59 830 616) 3 161 676 5.02%Total expenditure (275 325 000) 336 000 (274 989 000) (279 608 857) (4 619 857)Operating surplus 15 796 000 336 000 16 132 000 15 164 158 (2 967 842)Loss on disposal of assets and liabilities

(107 929) (107 929) (100%)

Surplus 15 796 000 336 000 16 132 000 13 056 229 (3 075 771)Actual on comparable basis as presented in the Budget and Actual Comparative Statement

15 796 000 336 000 16 132 000 13 056 229 (3 075 771)

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Budget on cash basis Approved budget

Budget Adjustments

Final Budget

Actual Difference between

fi nal budget and actual

Variance percentage

R R R R R RStatement of Financial PositionAssetsCurrent assetsInventories 0 0 0 283 742 283 742 (100%)Receivables from non-exchange transactions

0 0 0 374 129 374 129 (100%)

Prepayments 0 0 0 3 649 342 3 649 342 (100%)Cash and cash equivalents 0 0 0 2 462 119 2 462 119 (100%)

0 0 0 6 769 332 6 769 332Non-current assetsProperty plant and equipment 5 271 000 336 000 5 607 000 14 925 343 9 318 343 166.19%Intangible assets 10 525 000 0 10 525 000 15 727 190 5 202 190 49.43%Receivables from non-exchange transactions

0 0 0 65 772 65 772 (100%)

15 796 000 336 000 16 132 000 30 718 305 14 586 305Total assets 15 796 000 336 000 16 132 000 37 487 637 21 355 637LiabilitiesOperating lease liability 0 0 0 842 898 842 898 (100%)Payables from exchange transactions

0 0 0 7 595 246 7 595 246 (100%)

Payables from non-exchange transactions

0 0 0 9 358 869 9 358 869 (100%)

Provisions 0 0 0 4 737 497 4 737 497 (100%)0 0 0 22 534 510 22 534 510

Non-current liabilitiesProvisions 0 0 0 2 364 000 2 364 000 (100%)Total liabilities 0 0 0 24 898 510 24 898 510Net assets 15 796 000 336 000 16 132 000 12 589 127 (3 542 873)Accumulated surplus 15 796 000 336 000 16 132 000 12 589 127 (3 542 873)

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Explanation of variances between approved budget and actual

Reasons for variances greater than 5% between approved budget and actual amount in the various items in the Statement of Financial Performance are explained below:

Sundry revenue

The variance is caused by the approved cash budget which does not include an allocation for sundry revenue.

Interest earned

The variance is caused by the approved cash budget which does not include an allocation for interest earned.

Public contributions and donations

The variance is caused by the fact that the donations received were not part of the appropriated funds.

2. Expenditure

Personnel

The variance is caused by the accrual liabilities.

Repairs and maintenance

Maintenance and repairs are conducted on demand for minor machinery and equipment and offi ce facilities.

Transfers and subsidies

The variance is attributed to the actual transfers made to political parties which are in accordance to an agreed payment schedule however the variance is due to funds for one political party which is administered by the Legislature.

Contracted services

The variance is caused by contractual obligations for IT services which were underfunded.

General expenses

The variance is caused by the accrual for 2013/2014 fi nancial year paid in the 2014/2015 fi nancial year.

Depreciation and debt impairment

The variance is caused by the approved cash budget which does not include those items.

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3. Assets

Property, plant and equipment

The variance is due to the actual which includes accumulated balances while the fi nal budget is for the current fi nancial year.

Intangible assets

The variance is due to the actual which includes accumulated balances while the fi nal budget is for the current fi nancial year.

RECONCILIATION OF BUDGET SURPLUS/(DEFICIT) IN THE STATEMENT OF FINANCIAL PERFROMANCE

Description 2014/15R

Net surplus/(defi cit) per the Statement of Financial Performance 13 056 229Revenue from non – exchange transactionsSundry revenue (637 005)Public contributions and donations (250 000)Revenue from exchange transactionInterest earned (755 814)Sundry revenue (9 196)ExpenditureEmployee related costs (1 361 545)Depreciation and amortisation 4 052 024Impairment losses 449 524Repairs and maintenance (188 310)Contracted services 5 040 142Transfer payments (210 302)General expenses (3 161 676)Loss on disposal of property, plant and equipment 107 929Net surplus per approved budget 16 132 000

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STATEMENT OF COMPARISON OF BUDGET AND ACTUAL AMOUNTS FOR THE PERIOD ENDED 31 MARCH 2015

The Legislature’s budget is approved on a cash basis by functional classifi cation. The approved budget covers the fi nancial year from 01 April 2014 to 31 March 2015. The budget and the basis of accounting differ.

The fi nancial statements are prepared on the accrual basis using a classifi cation based on the nature of the expenses and carrying values in the statement of fi nancial performance and the statement of fi nancial position. Adjustments to the amounts in the fi nancial statements for timing differences associated with the continuing appropriations were made to express the accrual amounts on a comparable basis to the fi nal approved budget.

Reconciliation between the actual amounts on a comparable basis as presented in the Statement of Comparison of Budget and Actual Amounts and the actual amounts in the Statement of Cash Flows for the year ended 31 March 2015 is presented on the reconciliation above. The fi nancial statements and the budget documents are thus prepared for the same period, but there is a basic difference in that the budget is prepared on a cash basis and the fi nancial statements on the accrual basis

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ACCOUNTING POLICIES FOR THE PERIOD ENDED 31 MARCH 2015

1. Basis of Presentation

The fi nancial statements have been prepared on the accrual basis of accounting and are in accordance with the historical cost convention, except where indicated otherwise.

These fi nancial statements have been prepared in accordance with the effective Standard of GRAP as approved by the Minister of Finance, including any interpretations, guidelines and directives issued by the Accounting Standard Board.

Changes in Accounting Policy and Comparability

Accounting policies have been consistently applied, except where otherwise indicated below:

For the year ended 31 March 2014 and 31 March 2015, the Legislature had adopted the accounting framework as set out in point 1 above. The information for prior year ended March 2014 is for a period of 12 months. The details of any resulting accounting policy and comparative fi gures are set out below:

The Legislature changes an accounting policy only in the following instances:

(a) If it is required by a Standard of GRAP; or

(b) If it results in the fi nancial statements providing more reliable information about the effects of transaction, other events or conditions on the Legislature’s fi nancial position, fi nancial performance or cash fl ow.

Critical Judgements, Estimates and Assumptions

In the application of the Legislature accounting policies described below, management is required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be reasonable under the circumstances, the result of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

These estimates and underlying assumptions are reviewed on an on-going basis. Revision to accounting estimates are recognised in the period in which the estimates is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods.

The following are the critical judgements and estimates that management have made in the process of applying the Legislature’s accounting policies and that have the most signifi cant effect on the amounts recognised in the fi nancial statements:

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Revenue Recognition

Accounting Policy 1.6 on the Revenue Recognition describes the conditions under which revenue will be recorded by the management of the Legislature.

In making their judgement, management considered the detailed criteria for the recognition of revenue as set out in GRAP 9: Revenue from exchange transactions and GRAP 23: Revenue from non-exchange transactions. Of importance is the estimation process measuring revenue at the fair value on initial recognition. Management of the Legislature is satisfi ed that recognition of the revenue in the current year is appropriate.

Financial Assets and Liabilities

The classifi cation of fi nancial assets and liabilities into categories is based on judgement by management Accounting Policy 1.4 on fi nancial assets and liabilities classifi cation describes the factors and criteria considered by management of the Legislature in the classifi cation of fi nancial assets and liabilities.

In making the above mentioned judgement management considered the defi nition and recognition criteria for the classifi cation of fi nancial instruments as set out in GRAP 104: Financial instruments.

Impairment of Financial Assets

Accounting Policy 1.3 on impairment of fi nancial assets describes the process followed to determine the value by which fi nancial assets should be impaired. In making the estimate of the impairment, management of the Legislature considered the detailed criteria of impairment of fi nancial assets as set out in GRAP 104: Financial instruments and used its judgement to select a variety of methods and make assumptions that are mainly based on market conditions existing at the end of the reporting period. Management of the Legislature is satisfi ed that the impairment of fi nancial assets recorded during the year is appropriate.

The calculation in respect of impairment of debtors is based on an assessment of the extent to which debtors have defaulted on payments already due, and an assessment of their ability to make payments based on their fi nancial position and slow or non-payment within the last 12 months.

Useful lives of Property, Plant and Equipment and Intangible Assets

As described in Accounting Policy 1.1 and 1.2 the Legislature depreciates/ amortises its property, plant and equipment, and intangible assets over the estimates useful lives of the assets, taking into account the residual values of the assets at the end of their useful lives, which is determined when the assets are available for use. The useful lives of assets are based on management’s estimation. Management considered the impact of technology, availability of capital funding, servicing requirements and required service potential on assets in order to determine the optimum useful life expectation, where appropriate.

The estimation of residual values of assets is based on management’s judgement as to whether the assets will be sold or used to the end of their useful lives, and what condition they will be at that time.

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Impairment write-down of Property, Plant and Equipment, Intangible Assets and Inventories

Accounting Policy 1.3 on impairment of assets, Accounting Policy 1.2 on intangible assets – subsequent measurement, amortisation and impairment and Accounting Policy 1.5 on inventory – subsequent measurement describe the conditions under which non-fi nancial assets are tested for potential impairment losses by management of the Legislature. Signifi cant estimates and judgements are made relating to impairment testing, intangible assets impairment testing and write down of inventories to the lower of cost and current replacement cost (CRC).

In making the above-mentioned estimates and judgement, management considered the subsequent measurement criteria and indicators of potential impairment losses as set out in GRAP 21: impairment of non-cash generating assets. In particular, the calculation of the recoverable service amount for property, plant and equipment, intangible assets and the CRC for inventories involve signifi cant judgement by management

Budget information

Deviations between budget and actual amounts are regarded as material differences when a 5% deviation exists. All material differences are explained in the Statement of Comparison of Budget and Actual Amounts. The Legislature budget is prepared on cash basis.

Presentation Currency

The Financial Statements are presented in South African Rand, rounded off to the nearest Rand, which is the Legislature’s functional currency.

Going Concern Assumption

Financial statements have been prepared on the assumption the Legislature will continue to operate as a going concern for at least the next 12 months.

Offsetting

Assets, liabilities, revenues and expenses have not been offset except when offsetting is required or permitted by the standard of GRAP.

1.1 Property, Plant and Equipment

Initial recognition

The Legislature has taken advantage of the transitional provisions in terms of Directive 8 of the Accounting Standard Board and as such, the fi nal property, plant and equipment measurement was not yet performed. An extensive assets verifi cation and evaluation process is taking place to record all assets.

Property, plant and equipment are tangible non-current assets that are for administrative purposes, and are expected to be used for more than one year.

The cost of an item of property, plant and equipment is recognised as an assets if, and only if it is probable that future service potential associated with the item will fl ow to the Legislature, and if the cost or fair value of the item can be measured reliably.

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Property, plant and equipment are initially recognised at cost on their acquisition date or in the case of assets acquired by grant or donation, deemed cost, being the fair value of the assets on date of acquisition. The cost of an item of property, plant and equipment is the purchase price and other costs attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by the Legislature. Trade discounts and rebates are deducted in arriving at the cost. The cost also includes the necessary costs of dismantling and removing the asset and restoring the site on which it is located.

When signifi cant components of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.

The cost of an item property, plant and equipment acquired in exchange for non-monetary assets or monetary assets, or a combination of monetary non-monetary assets is measured at the fair value of the assets given up, unless the fair value of the asset received is more clearly evident. If the acquired item could not be measured at its fair value, its cost is measured at the carrying amount of the assets given up.

Major spare parts and servicing equipment qualify as property, plant and equipment when the Legislature expects to use them during more than one period. Similarly, if the major spare and servicing equipment can be used only in connection with an item of property, plant and equipment, they are accounted for as property, plant and equipment.

Subsequent Measurement

Subsequent expenditure relating to property, plant and equipment is capitalised if it is probable that future service potential associated with the subsequent expenditure will fl ow to the entity and the cost or fair value of the subsequent expenditure can be reliably measured. Subsequent expenditure incurred on assets is only capitalised when it increases the capacity or future economic benefi ts associated with the asset. Where the Legislature replaces parts of an asset, it derecognises the part of the asset being replaced and capitalises the new component.

Subsequently all property plant and equipment are measured at cost less accumulated depreciation and accumulated

impairment losses.

Where items of property, plant and equipment have been impaired, the carrying value is adjusted by the impairment loss,

which is recognised as an expense in the period that the impairment is identifi ed.

Compensation from third parties for items of property, plant and equipment that were impaired, lost or given up is included in surplus or defi cit when the compensation becomes receivable.

Depreciation

Depreciation on assets is calculated at cost, using the straight line method, to allocate their cost or revalue amounts to their residual values over the estimated useful lives of the assets. Depreciation charge for the period is recognised in surplus or defi cit except where it is included in the carrying amount of another asset. The depreciation method used refl ects the pattern in which the assets’ future service potential are expected to be consumed by the Legislature each part of an item of property, plant and equipment with a cost that is signifi cant in relation to the total cost of item shall be depreciated separately, depreciation only commences when the assets is available to use, unless stated otherwise.

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Then depreciation rates are based on the following estimated useful lives:

Years

Motor vehicles 7-15

Offi ce equipment 4-7

Furniture and fi ttings 4-7

Computer equipment 4-7

The assets residual values, estimated useful lives depreciation methods are reviewed annually, and adjusted prospectively if appropriate, at each reporting date.

Reviewing the useful life of an asset on an annual basis does not require the Legislature to amend the previous estimate unless expectations differ from the previous estimate.

De-recognition of Property, Plant and Equipment

The carrying amount of an item of property, plant and equipment is de-recognised on disposal, or when no future service potential is expected from its use or disposal.

The gain or loss arising from the de-recognition of an item of property, plant and equipment is included in surplus or defi cit when the item is derecognised.

The gain or loss arising from the disposal or retirement of property, plant and equipment is determined as the difference between the carrying value of assets (cost less accumulated depreciation and accumulated impairment losses) and the disposal proceeds which is recognised in the Statement of Financial Performance as a gain or loss on disposal of property, plant and equipment.

1.2 Intangible Assets

Initial Recognition

Identifi able non-monetary assets without physical substance are classifi ed and recognised as intangible assets. The Legislature recognises an intangible asset in its Statement of Financial Position only when it is probable that the expected future services potential that is attributable to the asset will fl ow to the Legislature and the cost or fair value of the asset can be measured reliably.

This probability of expected future economic benefi ts or service potential is assessed using reasonable and supportable assumptions that represent management’s best estimate of the set relevant conditions that will exist over the useful life of the asset.

GRAP 31:30: The purchase price, including import duties and non-refundable purchase taxes, after deducting trade discounts and rebates and any direct attributable costs of preparing the asset for its intended use must be included in the cost of a separately acquired intangible asset.

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GRAP 31:31: The recognition of costs in the carrying amount of an intangible asset must cease when the asset is in the condition necessary for it to be capable of operating in the intended by management.

GRAP 31:39: When an item is acquired at no or normal consideration, it should be recognised at a fair value.

Subsequent Measurement, Amortisation and Impairment

After initial recognition, an intangible asset is carried at its cost less any accumulated amortisation and any accumulated impairment losses. Expenditure on an intangible item that was initially recognised as an expense shall not be recognised as part of the cost of an intangible asset at a later date.

Intangible assets are distinguished between indefi nite or fi nite useful lives. Amortisation is charged on a straight line basis over the intangible assets’ useful lives (when the intangible asset is available for use), unless an active market exists. Where intangible assets are deemed to have an indefi nite useful life, such intangible assets are not amortised, however such intangible assets are subject to an annual test. The useful lives per category of intangible assets are detailed below:

Intangible Assets

Intangible Asset Year

Software 4

Financial management system Indefi nite

Intangible assets are annually tested for impairment. Where items of intangible assets have been impaired, the carrying value is adjusted by the impairment loss, which is recognised as an expense in the period that the impairment is identifi ed. The impairment loss is the difference between the carrying amount and the recoverable amount.

The estimated useful life, residual value and amortisation methods are reviewed annually at the end of the fi nancial year. Any adjustments arising from the annual review are applied prospectively as a change in accounting estimate in the Statement of the Financial Performance.

De-recognition

Intangible assets are derecognised when the asset is disposed or when there is no further service potential expected from the use of the asset. The gain or loss arising from the disposal or retirement of an intangible asset is determined as the difference between the net disposal proceeds and the carrying value and it is recognised in the Statement of Financial Performance as a gain or loss on disposal assets.

1.3 Impairment of Assets

The Legislature has classifi ed all assets held as non-cash generating assets.

When considering for indication that an asset may be impaired, the Legislature has to consider the following:

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External Sources of Information:

(i) Cessation, or near cessation, of the demand or need for service provided by the asset,

(ii) Signifi cant long-term changes with a favourable effect on the entity that has taken place during the period, or will take place in the near future, in the technological, legal or the Legislature policy environment in which the institution operates.

Internal Sources of Information:

(i) Signifi cant long-term changes with the favourable effect on the Legislature that have taken place during the period, or is expected to take place in the near future, in the extent to which, or manner in which, the asset is used or is expected to be used.

(ii) Evidence from internal reporting that the service performance of the asset is, or will be, signifi cantly better than expected.

Impairment of Non-Cash Generating Assets

The Legislature assesses at each reporting date whether there is any indication that an asset may be impaired. If any such indication exists, the Legislature estimates the recoverable service amount of the asset.

If it is not possible to estimate the recoverable service amount of the individual asset, the recoverable service amount of the cash-generated unit to which the asset belongs is determined. After the recognition of an impairment loss, the depreciation or amortisation charge for the asset must be adjusted in future periods to allocate the asset’s revised carrying amount, less its residual value if any), on a systematic basis over its remaining useful life.

The recoverable service amount of an asset is less than its carrying amount; the carrying amount of the asset is reduced to its recoverable service amount, that reduction is an impairment loss.

An impairment loss is recognised for non-cash generating units if the recoverable service amount of the unit is less than the carrying amount of the unit. The impairment loss is allocated to reduce the carrying amount of the assets of the unit as follows:

(i) To the assets of the unit, pro rata on the basis of the carrying amount of each asset in the unit.

The Legislature assesses at each reporting date whether there is any indication that an impairment loss recognised prior periods for assets may no longer exist or may have decreases. If any such indication exists, the recovered able service amounts of those assets are estimated.

The increased carrying amount of an asset attributed to a reversal of an impairment loss does not exceed the carrying amount that would have been determined hand no impairment loss been recognised for the asset on prior periods.

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A reversal of an impairment loss of assets carried at cost less accumulated depreciation or amortisation is recognised immediately in surplus or defi cit. Any reversal of an impairment loss should be recognised, the depreciation or amortisation charge for the asset must be adjusted in future periods to allocate the asset’s revised carrying amount, less its residual value (if any), on a systematically basis over its remaining useful life.

1.4 Financial Instruments

The Legislature has various types of fi nancial instruments and these can be broadly categorised as either fi nancial assets or fi nancial liabilities in accordance with the substance of the contractual agreement. The Legislature only recognised fi nancial instruments when it becomes a party to the contractual provisional of the instruments.

Initial Recognition

Financial assets and fi nancial liabilities are recognised on the Legislature’s Statements of Financial Position when the Legislature becomes party to the contractual provisional of the instrument.

The Legislature does not offset a fi nancial asset and a fi nancial liability unless a legally enforceable right to offset the recognised amounts currently exist; and the Legislature intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

The Effective Interest Rate Method

The effective interest rate method is a method of calculating the amortised cost of a fi nancial asset or a fi nancial liability and of allocating the interest income or interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimate future cash payments or receipts through the expected life of the fi nancial instruments or, when appropriate, a shorter period to the net carrying amount of the fi nancial assets or fi nancial liability.

Amortised Cost

Amortised cost is the amount at which the fi nancial asset or fi nancial liability is measured at initial recognition minus principal repayments, plus or minus the cumulative amortisation using the effective interest method of any different between that initial amount and the maturity amount and minus any reduction for impairment or uncollectability.

Financial Assets-Classifi cation

A fi nancial asset is any asset that is cash or a contractual right to receive cash.

In accordance with GRAP 104: Financial instruments, the fi nancial assets of the Legislature are classifi ed into the three categories allowed by this standard as follows:

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Financial assets at amortised cost

Financial assets at amortised cost are non-derivative fi nancial assets with fi xed or determined payments that are not quoted in an active market. They are included in current assets, except for maturities greater than 12 months, which are classifi ed as non-current assets.

Cash includes cash on hand cash with banks. Cash equivalent are short-term highly liquid, readily convertible into known amounts of cash, that held with registered banking institutions with maturities of three months for less and are subjected to an insignifi cant risk of change in value. For the purpose of the cash fl ow statements, cash and cash equivalents comprise cash on hand and deposits held on call with banks, net of bank overdrafts. The Legislature categorised cash and cash equivalent as fi nancial assets: At amortised cost.

(ii) Financial assets at fair value

Financial assets measured at fair value are fi nancial assets that meet either of the following conditions:

(a) derivatives;

(b) combined instruments that are designed at fair value;

(c) instruments held for trading;

(d) non-derivative fi nancial assets or fi nancial liabilities with fi xed or determined payments that are designated at fair value at initial recognition; or

(e) fi nancial instrument that do not meet defi nition of fi nancial instruments at amortised cost or fi nancial instruments at cost.

(iii) Financial assets at cost

Financial assets measured at cost are investment in residual interest that do not have a quoted market price in an active market, and whose fair value cannot be reliably measured.

The Legislature has the following types of fi nancial assets as refl ected on the face of the Statement of Financial Position or in the notes thereto:

Types of Financial Assets Classifi cati on in terms of GRAP 104

Cash and cash equivalents Financial assets at amortised cost

Receivables from non- exchange transactions Financial assets at amortised cost

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Financial Liabilities-Classifi cation

Financial liability is a contractual obligation to deliver cash or other fi nancial assets by the Legislature.

There are three main categories of fi nancial liabilities, the classifi cation determining how they are measured. Financial liabilities may be measured at:

(i) fair value or

(ii) amortised cost

(iii) cost

The Legislature has the following types of fi nancial liabilities as refl ected on the face of the Statements of Financial Position or in the notes thereto:

Types of Financial Liabilities Classifi cation in terms of GRAP 104

Payables from exchange transactions Financial liabilities at amortised cost

Payables from non- exchange transaction Financial liabilities at amortised cost

Financial liabilities that are measured at fair value are fi nancial liabilities that are essentially held for trading (i.e purchased with the intention to sell or repurchased in the short term; derivatives other that hedging instruments or are part of a portfolio of fi nancial instruments where there is recent actual evidence of short-term profi teering or are derivatives).

Initial and Subsequent Measurement

Financial Assets:

Financial assets at amortised cost are initially measured at fair value plus transaction costs that are directly attributable to the acquisition or issue of the fi nancial asset. Subsequently, these assets are measured at amortised cost using the Effective Interest Rate Method less any impairment, with interest recognised on an effective yield basis.

Financial assets measured at fair value are initially measure at fair value plus directly attributable transaction costs. They are subsequently measured at fair value with unrealised gains or losses recognised directly in equity until the investment is derecognised, at which time the cumulative gain or loss recorded in equity is recognised in the Statement of Financial Performance, or determined to be impaired, at which time the cumulative loss recorded in equity is recognised in the Statement of Financial Performance.

Financial assets at cost are initially and subsequently measured at cost.

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Financial Liabilities:

Financial liabilities measured at fair value

Financial liabilities measured at fair value are stated at fair value, with any resulted gain or loss recognised in the Statement of Financial Performance.

Financial Liabilities measured at amortised cost

Trade and other payables, interest bearing debt including fi nance lease liabilities and non-interest bearing debt are initially measured at fair value, net of transaction costs are subsequently measured at amortised cost using the effective interest rate method. Interest expense is recognised in the Statement of Financial Performance by applying the effective interest rate.

Impairment of Financial Assets

Financial assets, other than those measured at fair value, are assessed for indication of impairment at the end of each reporting period. Financial assets are impaired where there is objective evidence of impairment of fi nancial assets (such as the probability of insolvency or signifi cant fi nancial diffi culties of the debtor). If there is such evidence the recoverable amount is estimated and an impairment loss is recognised in accordance with GRAP 104.

Financial Assets Carried at Amortised Cost

Accounts receivables encompass long term debtors, staff debtors and other debtors.

Accounts receivables are initially valued at fair value and are subsequently carried at amortised cost using the effective interest rate method. An estimate is made for doubtful debt based on past default experience of all outstanding amounts at year-end. Bad debts are written off in the year in which they are identifi ed as irrecoverable. Amounts receivables within 12 months from the date of reporting are classifi ed as current.

A provision is made in accordance with GRAP 104 whereby the recoverability of accounts receivables is assessed individually and then collectively after grouping the assets in fi nancial assets with similar recoverability. The amount of the provision is the difference between the fi nancial assets carrying amount and the present value of estimated future cash fl ows, discounted at the original effective interest rate.

Future cash fl ows in a group of fi nancial assets that are collectively evaluated for impairment are estimated on the basis of historical loss experience for assets with credit risk characteristics similar to those in the group. Cash fl ows relating to short term receivables are not discounted where the effect of discounting is immaterial.

Impairment of Financial Assets Measured at Cost

If there is objective evidence that an impairment loss has been incurred on an investment in a residual interest that is not measured at fair value because its fair value cannot be measured reliably, the amount of the impairment loss is measured as the different between the carrying amount of the fi nancial asset and the present value of estimated future cash fl ows discounted at the current market rate of return for a similar fi nancial asset. Such impairment losses shall not be reserved.

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De-recognition

Financial Assets

The Legislature derecognises fi nancial assets only when the contractual rights to the cash fl ows from the asset expires or it transfers the fi nancial asset and substantially all the risks and rewards of ownership of the another entity, except when management approves the write-off of fi nancial assets due to non-recoverability.

If the Legislature neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Legislature recognises its retained interest in the asset and an associated liability for amounts it may have to pay. If the Legislature retains substantially all the risks and rewards of ownership of a transferred fi nancial asset, the Legislature continues to recognise the fi nancial asset and also recognises a collateralised borrowing for the proceeds received.

Financial Liabilities

The Legislature derecognises fi nancial liabilities when, and only when, the Legislature’s obligation is discharge, cancelled or expired.

The Legislature recognises the difference between the carrying amount of the fi nancial liability (or part of a fi nancial liability) extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, in the Statement of Financial Performance.

1.5 Inventories

Initial Recognition

Inventories comprise current assets held for consumption or distribution during the ordinary course of business. Inventories are initially recognised at cost. Cost generally refers to the purchase price, plus taxes, transport costs and other costs in bringing the inventories to their current location and condition.

Where inventory is acquired by the Legislature for no nominal consideration (i.e. a non-exchange transaction), the cost is deemed to be equal to the fair value of the item of the date acquired.

Subsequent Measurement

Consumable stores, raw material, work-in-progress and fi nished goods.

Consumables stores, raw material, work-in-progress and fi nished goods are valued at the lower of cost and net realisable value (net amount that the Legislature expects to realise from the sale on inventory in the ordinary course of business).

In general, the basis of determining cost is the fi rst-in fi rst-out cost of commodities. If inventories are to be distributed at no charge or for a nominal charge they are valued at the lower cost and current replacement cost.

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Redundant and Slow-moving Inventories

Redundant and slow-moving inventories are identifi ed and written down from cost to net realisable value with regards to their estimated economics or realisable value and sold by public auction. Net realisable value is the estimated selling price in the ordinary course of business less applicable variable selling expense. Difference arising on the measurement of such inventory at the lower cost and net realisable value recognised in the Statement of Financial Performance in the year in which they arise.

The amount of any reversal of any write-down of inventories arising from an increase in net realisable value or current replacement cost is recognised as a reduction in the amount of inventories recognised as an expense in the period in which the reversal occurs.

The carrying amount of inventories is recognised as an expense in the period that the inventory was sold, distributed, written off or consumed, unless that cost qualifi es for capitalisation to the cost of another asset.

1.6 Revenue Recognition

General

Revenue is derived from a variety of sources which include appropriations from Provincial Government and revenue from non-trading activities and other goods and services provided. Revenue is recognised when it is probable that future economic benefi ts or service potential will fl ow to the Legislature and these benefi ts can be measured reliably, except when specifi cally stated otherwise.

Revenue comprises the fair value of the consideration received for the sale of goods and services in the ordinary course of the Legislature’s activities.

The Legislature recognised revenue when the amount of revenue can be reliably measured, it is probable that future economic benefi ts will fl ow to the Legislature and when specifi c criteria have been met for each of the Legislature’s activities as described below. The amount of revenue is not considered to be reliably measureable until all contingencies relating to the sale have been resolved. The Legislature bases its estimates on historical results, taking into consideration the type of transaction and the specifi c of each arrangement.

Revenue from exchange transactions refers to revenue that accrued to the Legislature directly in return for goods sold, the value of which approximates the consideration received or receivable.

Revenue from non-exchange transactions refers to transactions where the Legislature received revenue from another entity without directly giving approximately equal value in exchange. Revenue from non-exchange transactions is generally recognised to the extent that the related receipt or receivable qualifi es for recognition as an asset and there is no liability to repay the amount.

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Revenue from Exchange Transactions

Finance Income

Interest earned on fi nancial assets is recognised in the Statement of Financial Performance on the time proportionate basis that takes into account the effective yield on the investment.

Sale of Goods

Revenue from the sale of goods is recognised when all the following conditions have been met:

(a) The Legislature has transferred to the buyer the signifi cant risks and rewards of ownership of the goods.

(b) The Legislature retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold.

(c) The amount of revenue can be measured reliably.

(d) It is probable that the economic benefi ts or service potential associated with the transaction will fl ow to the Legislature.

(e) The costs incurred or to be incurred in respect of the transaction can be measured reliably.

Revenue from Non-exchange Transactions

An infl ow of resources from a non-exchange transaction that meets the defi nition of an asset shall be recognised as an asset when it is probable that the future economic benefi ts or service potential associated with the asset will fl ow to the Legislature and the fair value of the asset can be measured reliably. The asset shall be recognised as revenue, except to the extent that a liability is also recognised in respect of the same infl ow.

A present obligation arising from a non-exchange transaction that meets the defi nition of a liability will be recognised as a liability when it is probable that an outfl ow of economic benefi t will be required to settle the obligation and a reliable estimate of the amount can be made.

Revenue from non-exchange transactions is measured at the amount of the increase in net assets recognised by the Legislature. When, as a result of a non-exchange transaction, the Legislature recognises an asset, it also recognises revenue equivalent to the amount of the asset measured at its fair value as at the date of acquisition, unless it is also required to recognise a liability.

Where a liability is required to be recognised it will be measured as the best estimate of the amount required to settle the obligation at the reporting date and the amount of the increase in net asset, if any, is recognised as revenue. When liability is subsequently decreased, the amount of the reduction in the liability is recognised as revenue.

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Public Contributions

Donations and funding are recognised as revenue to the extent that the Legislature has complied with any of the criteria, conditions or obligations embodied in the agreement. Where the agreement contains a stipulation to return the asset, other future economic benefi ts or service potential, in the event of non-compliance to these stipulations that could be legally enforced by the transferor, a liability is recognised to the extent that the criteria, conditions or obligations have not been met. Where such requirements are not enforceable, or where past experience has indicated that the transferor has never enforced the requirement to return the transferred asset, other future economic benefi ts or service potential when breaches have occurred, the stipulation will be considered a restriction and is recognised as revenue.

Revenue from public contributions is recognised when all conditions associated with the contribution have been met or where the contributions is to fi nance property, plant and equipment, when such items of property, plant and equipment are brought into use.

Assets acquired in non-exchange transactions are measured at fair value in accordance with the Standards of GRAP 23: Non-exchange revenue.

Appropriated Funds

Appropriated funds are recognised as revenue to the extent that the Legislature has compiled with any of the criteria, conditions or obligations embodied in the agreement. Where the agreement contains a stipulation to return that asset, other future economic benefi ts or service potential, in the event of non-compliance to these stipulations that could be legally enforced by the transferor, a liability is recognised to the extent that the criteria, conditions or obligations have not been met. Where such requirements are not enforceable or where past experience has indicated that the transferor has never enforced the requirement to return the transferred asset, other future economic benefi ts or service potential when breaches have occurred, the stipulation will be considered a restriction and is recognised as revenue.

Revenue is recognised when all conditions associated with the contribution have been met or where the contribution is to fi nance property, plant and equipment, when such items of property, plant and equipment are brought into use.

Revenue from Recovery of Unauthorised, Irregular, Fruitless and Wasteful Expenditure

Revenue from the recovery of unauthorised, irregular, fruitless and wasteful expenditure is based on legislated procedures, including those set out in the Financial Management of Parliament and Provincial Legislatures Act and is recognised when the recovery thereof from the responsible offi cials is virtually certain. Such revenue is based on legislated procedures.

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1.7 Prepayments

Prepayments include costs for goods/services to be received in subsequent fi nancial years and are measured at cost. Prepayments expenses are recognised in the statement of fi nancial position when the payments are made and are recognised as expenditure as and when the goods/services are received or the funds are utilised.

Prepayments and advances at the end of the year are carried in the statement of fi nancial position at cost.

1.8 Provision

Provisions for legal claims are recognised when the Legislature has a present legal or constructive obligation as a result of past events, it is probable that an outfl ow of resources embodying economic benefi ts or service potential will be required to settle the obligation and a reliable estimate can be made of the obligation.

The best estimate of the expenditure required to settle the present obligation is the amount that the Legislature would rationally pay to settle the obligation at the reporting date or to transfer it to the third party at that time and are determined by the judgment of management, supplemented by experience of similar transactions and, in some cases, reports from the judgement of management, supplemented by experience of similar transactions and, in some cases, reports from independent experts. The evidence considered includes any additional evidence provided by events after the reporting date.

Uncertainties surrounding the amount to be recognised as a provision are dealt with by various means according to the circumstances. Where the provision being measured involves a large population of items, the obligation is estimated by weighting all possible outcomes by their associated probabilities.

Future events that may affect the amount required to settle an obligation are refl ected in the amount of a provision where there is suffi cient objective evidence that they will occur. Gains from the expected disposal of assets are not taken into account in measuring a provision. Provisions are not recognised for future operating losses. The present obligation under an onerous contract is recognised and measured as a provision. An onerous contract is a contract in which the unavoidable costs of meeting the obligations under the contract refl ect the least net cost of exiting from the contract, which is the lower of the cost of fulfi lling it and any compensation or penalties arising from failure to fulfi l it. This unavoidable cost resulting from the contract is the amount of the provision to be recognised.

Provisions are reviewed at reporting date and the amount of a provision is the present value of the expenditure expected to be required to settle the obligation. When the effect of discounting is material, provisions are determined by discounting the expected future cash fl ows that refl ect current market assessments of the time value of money. The impact of the periodic unwinding of the discount is recognised in the Statement of Financial Performance as a fi nance costs as it occurs.

Where it is no longer probable that an outfl ow of resources embodying economic benefi ts or service potential will be required to settle the obligation the provision will be reversed. Provisions can be used for expenditures for which the provisions were originally recognised.

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1.9 Employee Benefi ts

Short-term Employee Benefi ts

Short-term employee benefi ts are employee benefi ts (other than termination benefi ts) that are due to be settled within twelve months after the end of the period in which the employees render the related service.

The Legislature treats its provision for leave pay as an accrual.

Short-term employee benefi ts include items such as:

(i) Wages, salaries and social security contributions;

(ii) Short-term compensated absences (such as paid annual leave and paid sick leave) where the compensation for the absences is due to be settled within twelve months after the end of the reporting period in which the employees render the related employee service;

(iii) Bonus, incentive and performance related payments payable within twelve months after the end of the reporting period in which the employees render the related service; and

(iv) Non-monetary benefi ts (for example, medical care, and free or subsidised goods or services such as housing, cars and cell phones) for current employees.

The expected cost of compensated absences is recognised as an expense as the employees render services that increase their entitlement or, in the case of non-accumulating absences, when the absence occurs. The Legislature measures the expected cost of accumulating compensated absences as the additional amount that the Legislature expects to pay as a result of the unused entitlement that has accumulated at the reporting date.

The Legislature recognises the expected cost of bonus; incentive and performance related payments when it has a present legal or constructive obligation to make such payments as a result of past events and a reliable estimate of the obligation can be made. A present obligation exists when the Legislature has no realistic alternative but to make the payments.

Post-Employment Benefi ts

The Legislature provides retirement benefi ts for its employees and members through contribution to a pension fund.

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Defi ned Contribution

When an employee has rendered a service to the Legislature during a reporting period, the Legislature recognises the contribution payable to a defi ned pension fund in exchange for that service:

(i) As a liability (accrued expense), after deducting any contribution already paid. If the contribution already paid exceeds the contribution due for service before the reporting date, the Legislature recognise that excess as an asset (prepaid expense) to the extent that the prepayment will lead to, for example, a reduction in future payments or a cash refund; and

(ii) As an expense, unless another standard requires or permits the inclusion of the contribution in the cost of an asset.

Where contributions to a defi ned contribution plan do not fall due wholly within twelve months after the end of the reporting period in which the employees render the related service, they are discounted. The rate used to discount refl ects the time value of money. The currency and term of the fi nancial instrument selected to refl ect the time value of money is consistent with the currency and estimated term of the obligation.

1.10 Leases

Lease Classifi cation

Leases are classifi ed as fi nance leases where substantially all the risks and rewards associated with ownership of an asset are transferred to the Legislature.

Leases of property, plant and equipment, in which a signifi cant portion of the risks and rewards of ownership are retained by the lessor are classifi ed as operating leases.

The Legislature as Lessee

Operating Leases

The Legislature recognises operating lease rentals as an expense in the Statement of Financial Performance on a straight line basis over the term of the relevant lease. The difference between the amounts recognised as an expense and the contractual payments are recognised as an operating lease asset or liability.

In the event that lease incentives are received to enter into operating leases, such incentives are recognised as a liability. The aggregate benefi t of incentives is recognised as a reduction of rental expense on a straight-line basis, except where another systematic basis is more representative of the time pattern in which economic benefi ts from the leased asset are consumed.

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Determining whether an Arrangement Contains a Lease

At inception of an arrangement, the Legislature determines whether such an arrangement is or contains a lease. A specifi c asset is the subject of a lease if fulfi lment of the arrangement is dependent on the use of that specifi ed asset. An arrangement conveys the right to use the asset if the arrangement conveys to the Legislature the right to control the use of the underlying asset. At inception or upon reassessment of the arrangement, the Legislature separates payments and other consideration required by such an arrangement into those for the lease and those for other elements on the basis of their relative fair values. If the Legislature concludes a fi nance lease where it is impracticable to separate the payments reliably, an asset and a liability are recognised

at an amount equal to the value of the underlying asset. Subsequently the liability is reduced as payments are made and an imputed fi nance charge on the liability is recognised.

1.11 Transfer Payments

The Legislature transfers appropriated funds to the political parties represented in the Legislature in line with agreed arrangements when making these transfers, the Legislature does not:

(i) Receive any goods or services directly in return, as would be expected in a purchase or sale transaction;

(ii) Expect to be repaid in future; or expect a fi nancial return, as would be expected from an investment.

These transfers are recognised in the Statement of Financial Performance as expenses in the period that the events giving rise to the transfer occurred.

1.12 Unauthorised Expenditure

Unauthorised expenditure is the overspending of the Legislature’s approved budget (the vote or a main division within the vote). Expenditure from the Legislature’s approved budget for a purpose unrelated to the approved budget and any unauthorised expenditure is recognised as an expense in the Statement of Financial Performance in the year that the expenditure was incurred. The expenditure is classifi ed in accordance with the nature of the expense, and where recovered, it is subsequently accounted for as revenue in the Statement of Financial Performance.

1.13 Fruitless and Wasteful Expenditure

Fruitless and wasteful expenditure is expenditure that was made in vain and would have been avoided had reasonable care been exercised. All expenditure relating to fruitless and wasteful expenditure is recognised as an expense in the Statement of Financial Performance in the year that the expenditure incurred. The expenditure is classifi ed in accordance with the nature of the expense, and where recovered, it is subsequently accounted for as revenue in the Statement of Financial Performance.

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1.14 Irregular Expenditure

Irregular expenditure is expenditure incurred in contravention of, or that is not in accordance with a requirement of any applicable legislation. Irregular expenditure excludes unauthorised expenditure. Irregular expenditure is accounted for as an expense in the Statement of Financial Performance in the period it occurred and where recovered, it is subsequently accounted for as revenue in the Statement of Financial Performance.

1.15 Changes in Accounting Policies, Estimates and Errors

Changes in accounting policies that are affected by management have been applied retrospectively in accordance with GRAP3: Accounting policies, estimates and errors requirements, except to the extent that it is impracticable to determine the period-specifi c effects or the cumulative effect of the change in policy. In such cases the Legislature shall restate the opening balances of assets, liabilities and net assets for the earliest period for which retrospective restatement is practicable.

Changes in accounting estimates are applied prospectively in accordance with GRAP 3 requirements. Details of changes in estimates are disclosed in the Notes to the fi nancial statements where applicable.

Correction of errors is applied retrospectively in the period in which the error has occurred in accordance with GRAP 3 requirements, except to the extent that it is impracticable to determine the period-specifi c effects or the cumulative effect of the error. In such cases the Legislature shall restate the opening balances of assets, liabilities and net assets for the earliest period for which retrospective restatement is practicable.

1.16 Related Parties

Individuals as well as their close family members, and/or entities are related parties if one party has the ability, directly or indirectly, to control or jointly control the other party or exercise signifi cant infl uence over the other party in making fi nancial and/or operating decisions. Management is regarded as a related party.

Transactions with Government Departments of the Mpumalanga Province are considered to be related party.

1.17 Events after the Reporting Date

Events after the reporting date that are classifi ed as non-adjusting events have been accounted for in the fi nancial statements. The events after the reporting date that are classifi ed as non-adjusting events after the reporting date have been disclosed in the Notes to the fi nancial statements.

1.18 Comparative Information

Prior Year Comparatives

When the presentation of classifi cation of items in the fi nancial statements is amended, prior period comparative amounts are reclassifi ed. The nature and reasons for the reclassifi cation are disclosed.

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Budget Information

The annual budget fi gures are prepared in accordance with GRAP 24: Presentation of budget information in the fi nancial statements standard and are consistent with the accounting policies adopted by management for the preparation of these fi nancial statements. The amounts are scheduled as a separate additional fi nancial statement, called the Statement of Comparison of Budget and Actual Amounts in the budget motivations for over or under-spending on line items. These fi gures are those approved in the Mpumalanga Provincial Legislature estimate at the beginning and during the year.

The approved budget covers the period from 1 April 2014 to 31 March 2015. The budget is approved on a cash basis by programme and item classifi cation whereas the actual amounts are reported on accrual basis of accounting. Therefore the Statement of Comparison of Budget and Actual Amounts have not been prepared on the comparable basis of accounting.

1.19 Capital Commitments

Items are classifi ed as commitments where the Legislature commits itself to future transactions that will normally result in the outfl ow of resources.

Capital commitments are not recognised in the Statement of Financial Position as a liability but included in the disclosure notes in the following cases:

Approved and contracted commitments, where the expenditure has been approved and the contract has been awarded at the reporting date, where disclosure is required by a specifi c standard of GRAP.

Approved but not yet contracted commitments, where the expenditure has been approved and the contract has yet to be awarded or is awaiting fi nalisation at the reporting date.

Items are classifi ed as commitments where the Legislature commits itself to future transactions that will normally result in the outfl ow of resources.

Contracts that are entered into before the reporting date, but goods and services have not yet been received are disclosed in the disclosure notes to the fi nancial statements.

Other commitments for contracts are non-cancellable or only cancellable at signifi cant cost. Contracts that should relate to something other than the business of the Legislature.

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1.20 Contingent Assets and Contingent Liabilities

Contingent liabilities represent a possible obligation that arise from past events and whose existence will be confi rmed only by an occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity.

A contingent liability can also arise as a result of a present obligation that rises from past events but which is not recognised as a liability either because it is not probable that an outfl ow of resources embodying economics benefi ts will be required to settle obligation of the amount of the obligation cannot be measured with suffi cient reliability.

Contingent assets represent possible assets that arise from past events and whose existence will be confi rmed only by an occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity.

Contingent assets and contingent liabilities are not recognised, but are disclosed in the notes to the fi nancial statements.

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NOTES TO THE ANNUAL FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31 MARCH 2015

31 March 2015 31 March 2014R R

2. Inventories Consumable stores at cost 283 742 221 464

Total 283 742 221 464

Inventories are held for own use and measured at the lower of cost and current replacement cost.

No write downs of inventory to current replacement cost were required. The cost of inventory recognised as an expense during the period was R559 737 (March 2014 1 159 422). No inventories have been pledged as collateral for liabilities of the Legislature.

3. Receivables from non-exchange Transactions

Sundry debtors 374 129 578 060Total 374 129 578 060

Sundry debtors are respect of debits outstanding at the end of March 2015 on staff and other debtors.

The Legislature does not hold deposits or other security for its receivables.

None of the receivables have been pledged as security for the Legislature’s fi nancial liabilities

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Aging of Receivables from non-exchange Transactions

As at 31 March 2015 Current

0-30 days

31-60 days 61-90 days +90 days Total

Sundry debtors

Gross balances 190 700 0 0 755 397 946 097Less: Provision for impair-ment

0 0 0 (571 968) (571 968)

Net balance 190 700 0 0 183 429 374 129

All receivablesGross balances 190 700 0 0 755 397 946 097Less: Provision for impairment

0 0 0 (571 968) (571 968)

Net balance 190 700 0 0 183 429 374 129

As at 31 March 2014 receivables of R109 421 were past due but not impaired. The age analysis of these receivables is stated above.

The provision for impairment on receivables exists predominately due to the possibility that these debts may not be recovered. Sundry debtors were assessed individually and grouped together in the Statement of Financial Position as fi nancial assets with similar characteristics and collectively assessed for impairment.

An amount of R371 114 previously provided for has been reversed due to recovery and write-off.

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As at 31 March 2014 Current

0-30 days

31-60 days 61-90 days

+90 days Total

Sundry debtorsGross balances 0 0 0 1 071 618 1 071 618Less: Provision for impairment

0 0 0 (493 558) (493 558)

Net balance 0 0 0 578 060 578 060

All receivablesGross balances 0 0 0 1 071 618 1 071 618Less: Provision for impairment

0 0 0 (493 558) (493 558)

Net balance 0 0 0 578 060 578 060

As at 31 March 2014 receivables of R 578 060 were past due but not impaired. The age analysis of these receivables is as stated above.

The provision for impairment on receivables exists predominately due to the possibility that these debts may not be recovered. Sundry debtors were assessed individually and grouped together in the Statement of Financial Position as fi nancial assets with similar characteristics and collectively assessed for impairment.

Prior year fi gures have been reclassifi ed to align to the current year classifi cations. Details of the reclassifi cation of prior year fi gures are explained under note 36.

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Reconciliation of impairment provision Opening balance Contributions to provision 493 558 0 Reversal of provision 449 524 493 558

(371 114) 0 Total 571 968 493 558

4. Prepayments

Prepayments are payments made in advance expensed during the period under review, but the service will only be rendered during the next reporting period. Those prepayments are for license fees, rental and other general expenses.

Payments made in advance Gross balances 3 649 342 2 146 218 Total 3 649 342 2 146 218

Prior year fi gures have been reclassifi ed to align to the current year classifi cations. Details of the reclassifi cation of prior year fi gures are explained under note 36.

5. Cash and cash equivalents Cash and cash equivalents consist of: Bank balances 2 462 119 2 036 521 Total 2 462 119 2 036 521

For purposes of the Statement of Financial Position and the Cash Flow statement, cash and cash equivalents represents cash in bank.

Bank accounts Cash in bank 2 462 119 2 036 521

Total 2 462 119 2 036 521

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Primary bank accountFirst National Bank – Mbombela branchCash book balance at the beginning of the year 2 036 521 2 219 692Cash book balance at the end of the year 2 462 119 2 036 521Bank balance at the beginning of the year 2 036 521 2 160 056Bank balance at the end of the year 2 462 119 2 036 521

The Legislature does not have any overdrawn current account facilities with its banker and therefore does not incur interest on overdrawn current account. Interest is earned at different rates per annum on favourable balance.

The Legislature did not pledge any of its cash and cash equivalents as collateral for its fi nancial liabilities.

No restrictions have been imposed on the Legislature in terms of the utilisation of its cash and cash equivalents.

6. Property, plant and equipment

As at the reporting period, the Legislature elected to utilise the provisions of Directive 8 allowed by the Accounting Standard Board and will only disclose the fact that assets exist and can be verifi ed. An extensive evaluation process is on-going which may result to material adjustment to the carrying value of property, plant and equipment within the next fi nancial year.

2014Cost Accumulated

depreciation and accumulated

impairment

Carrying value

Cost Accumulated depreciation

and accumulated

impairment

Carrying value

Furniture and fi ttings

8 435 218 (3 750 128) 4 685 090 8 437 270 (2 702 574) 5 734 696

Motor vehicles 5 857 634 (927 444) 4 930 190 5 642 586 (1 103 847) 4 538 739Offi ce equipment 3 606 878 (1 948 114) 1 658 764 3 066 526 (1 376 470) 1 690 056Computer equipment

6 956 991 (3 305 692) 3 651 299 5 681 600 (3 096 386) 2 585 214

Total 24 856 721 (9 931 378) 14 925 343 22 827 982 (8 279 277) 14 548 705

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Reconciliation of property, plant and equipment – 31 March 2015

Opening balance Additions Disposals Depreciation Total


5 734 696 162 694 (7 410) (1 204 890) 4 685 090

Motor vehicles 4 538 739 1 195 049 (368 987) (434 611) 4 930 190Offi ce equipment 1 690 056 540 352 0 (571 644) 1 658 764Computer equipment

2 585 214 2 464 535 (3 282) (1 395 168) 3 651 299

14 548 705 4 362 630 (379 679) (3 606 313) 14 925 343

Reconciliation of property, plant and equipment – 31 March 2014

Opening balance

Additions Disposals Depreciation Impairment Total


6 828 010 117 973 0 (1 196 253) (15 034) 5 734 696

Motor vehicles 4 806 872 1 104 435 (738 774) (601 658) (32 136) 4 538 739Offi ce equipment 2 070 726 205 876 0 (564 133) (22 413) 1 690 056Computer equipment

3 339 183 896 201 (261 775) (1259 981) (128 414) 2 585 214

17 044 791 2 324 485 (1 000 549) (3 622 025) (197 997) 14 548 705

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The assets of the Legislature are acquired through procurement.

Assets pledged as security

The Legislature did not pledge any of its assets as security.

Impairment of property, plant and equipment

Impairment losses on property, plant and equipment to the amount of R197 994: March 2014 have been recognised in operating surplus and are included in impairment losses in the Statement of Financial Performance as indicated in note 20.

Change in estimate – useful Life of property, plant and equipment reviewed

There was no change (2013/14: R0) in the estimated useful life of various assets of the Legislature for the fi nancial year.

Recoveries from third parties

An amount of R171 095 was recovered from a third party for a vehicle which had been disposed. This amount is included in net surplus.

7. Intangible assets

2015 2014Cost Accumulated

depreciation and

accumulated impairment

Carrying value

Cost Accumulated depreciation and

accumulated impairment

Carrying value

Computer software and other

16 967 327 (1 240 137) 15 727 190 16 555 043 (794 427) 15 760 616

Total 16 967 327 (1 240 137) 15 727 190 16 555 043 (794 427) 15 760 616

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Reconciliation of intangible assets – 31 March 2015

Opening balance

Additions Amortisation Total


15 760 616 412 285 (445 711) 15 727 190

15 760 616 412 285 (445 711) 15 727 190

Reconciliation of intangible assets – 31 March 2014

Opening balance

Additions Amortisation Total


13 493 798 2 631 545 (364 727) 15 760 616

13 493 798 2 631 545 (364 727) 15 760 616

Intangible assets of the Legislature are acquired through procurement.

The amortisation expense has been included in the line item “Depreciation and Amortisation” in the Statement of Financial Performance, (see note 20).

All of the Legislature’s intangible assets are held under freehold interests and no intangible assets had been pledged as security for any liabilities of the Legislature. No restrictions apply to any of the intangible assets of the Legislature.

Amortisation is charged on a straight line basis over the intangible assets’ useful lives.

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Intangible assets with indefi nite useful livesThe following classes of intangible assets are not amortised as they are regarded as having indefi nite useful livesCost and carrying value of software: Financial Management System

14 898 000 14 898 000

Total 14 898 000 14 898 000

The fi nancial management system is expected to be available for use over an indefi nite period. The Legislature expects to derive economic benefi ts from the system beyond the current reporting period.

The useful lives of the Intangible Assets remain unchanged from the previous year.

Restricted titleNo restrictions apply to any of the intangible assets of the Legislature

Assets pledged as securityThe Legislature did not pledge any of its intangible assets a security.

Impairment of intangible assetsNo impairment losses have been recognised on intangible assets of the Legislature at the reporting date.

8. Receivables from non-exchange transactions Sundry debtors 65 772 0 Total 65 772 0


As at 31 March 2015 Current 0-30 days

31-60 days 61-90 days +90 days Total

Non-current receivablesSundry debtors 0 0 0 65 772 65 772Net balance 0 0 0 65 772 65 772

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9. Provisions

Reconciliation of provisions – 31 March 2015

As at 31 March 2015 Opening balance

Additions Utilised during the

year

Total

Provision for performance bonuses

2 007 497 2 144 921 (1 313 921) 2 838 497

Provision for long service awards

106 000 30 000 (15 000) 121 000

Provision for gratuities 4 852 000 2 645 225 (3 355 225) 4 142 000Net balance 6 965 497 4 820 146 (4 684 146) 7 101 497

The performance bonus provision represents the liability in respect of performance bonuses to be paid to employees dependent on the outcomes of their performance assessments for the 2014/15 fi nancial year. The provision is expected to be utilised within the next 12 months and the amount is thus dependent on the performance outcomes.

Long service benefi ts are awarded by the Legislature to staff in the form of fi xed cash amounts (after 10, 15, 20, 25, 30, 35 and 40 years of continuous service). Gratuity benefi t is awarded to Members of the Provincial Legislature who resign or are not re-elected.

In estimating the liability for long service and gratuity payment benefi ts a number of assumptions are required. GRAP 25 and International Accounting Standard (IAS) 19 places the responsibility on management to set these assumptions, as guided by the principles set out in GRAP 25 and IAS 19 and in discussion with the actuary.

The difference between the assumptions drives the valuation and it is very important to monitor how this difference changes from one valuation to the next. The most relevant actuarial assumptions used in this valuation are discussed below.

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Financial variables

The two most important fi nancial variables used in the valuation are the discount rate and salary infl ation. We have assumed the following values for these variables:

Financial variable Assumed Value 31-03-2015 Assumed Value at 31-03-2014(Current Valuation) (Preceding Valuation)

Discount Rate Yield Curve Yield CurveCPI (Consumer Price Infl ation) Difference between nominal Difference between nominal

and real yield curve and real yield curveNormal Salary Increase Rate CPI + 1% CPI + 1%Net Effective Discount Rate Yield Curve** Yield Curve**

Discount rate

GRAP 25 and IAS 19 defi ne the determination of the Discount Rate assumption to be used as follows:

The discount rate that refl ects the time value of money is best approximated by reference to market yields at the reporting date on government bonds. Where there is no deep market in government bonds with a suffi ciently long maturity to match the estimated maturity of all the benefi t payments, the Legislature uses current market rates of the appropriate term to discount shorter term payments, and estimates the discount rate for longer maturities by extrapolating current market rates along the yield curve.

The nominal and zero curves as at 31 March 2015 supplied by the Johannesburg Securities exchange (JSE) to determine the discounted rates and CPI assumptions at each relevant time period were used.

The Net Effective Discount Rate is different for each relevant time period of the yield curves’ various durations and therefore the Net Effective Discount Rate is based on the relationship between the (yield curve based) Discount Rate for each relevant time period and the (yield curve based) Salary Infl ation for each relevant time period.

Normal salary infl ation rate

The underlying future rate of CPI infl ation was derived from the relationship between the (yield curve based) Conventional Bond Rate for each relevant time period and the (yield curve based) Infl ation-linked Bond rate for each relevant time period. The assumed rate of salary infl ation was set as the assumed value of CPI plus 1%.

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Average retirement age

The average retirement age for all active employees was assumed to be 63 years. This assumption implicitly allows for ill-health and early retirements. The retirement age for public offi ce bearers was not specifi ed.

Mortality rates

Mortality before retirement has been based on the South Africa 85-90 mortality tables. These are the most commonly used tables in the industry.

Withdrawal decrements

A table setting out the assumed rates of withdrawal from service is set out below (these withdrawal decrements were only used for employees of the MPL and not public offi ce bearers):

Age Band Withdrawal RateWithdrawal

RateMale Female

20 - 24 16% 24%25 - 29 12% 18%30 - 34 10% 15%35 - 39 8% 10%40 - 44 6% 6%45 - 49 4% 4%50 - 54 2% 2%55 - 59 1% 1%60 + 0% 0%

Re-election rates

Based on the data available the re-election probability at each election for public offi ce bearers was assumed to be 33%. This means the probability to run two terms would be 11%, three terms 4% etc.

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Reconciliation of provisions as at 31 March 2014

Opening balance

Additions Utilised during the

year

Total

Provision for performance bonuses

1 557 829 2 007 497 (1 557 829) 2007 497

Provision for long service awards

0 129 000 (23 000) 106 000

Provision for gratuities 0 4 852 000 0 4 852 000Net balance 1 557 829 6 988 497 ( 1580 829 ) 6 965 497

Non-current liabilitiesCurrent liabilities 2 364 000 2 956 000

4 737 497 4 009 497

Total 7 101 497 6 965 497

10. Payables from exchange transactions

Trade payables 7 595 246 17 633 938 Total 7 595 246 17 633 938

11. Payables from non-exchange transactions Staff bonuses 2 574 066 2 199 590 Capped leave accrual 3 428 744 3 176 944 Other payables from non-exchange transactions 0 2 450 Staff leave accrual 3 356 059 2 971 764 Total 9 358 869 8 350 748

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Capped leave accrued to the staff of the Legislature, subject to certain conditions. The accrual is an estimate of the amount due at the beginning of the reporting period.

Annual leave accrue to the staff of the Legislature on an annual basis, subject to certain conditions. The accrual is an estimate of the amount due at the reporting date.

No credit period exists for payables from non-exchange transactions; neither has any credit period been arranged. No interest is charged on outstanding amounts.

12. Operating lease liabilities

Operating leases are recognised on a straight-line basis as per the requirements of GRAP 13. In respect of non-cancellable operating leases, the following liabilities have been recognised: Non-current 0 0 Current liabilities (842 898) (1 295 031) Total (842 898) (1 295 031)

Leasing arrangements

The Legislature as lessee:

Operating leases relate to property, plant and equipment with lease terms not longer than 5 years, with an option to extend for a further period. All operating lease contracts contain market review clauses in the event that the Legislature exercises its option to renew. The Legislature does not have an option to purchase the leased assets at the expiry of the lease period.

Amounts payable under operating leases

At the reporting date, the Legislature had outstanding commitments under non-cancellable operating leases for property, plant and equipment, which was due as follows:

Buildings and equipment: Up to 1 year 10 611 463 6 795 700 1 to 5 years 6 717 377 6 172 470 Total 17 328 840 12 968 170

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The Following payments have been recognised as an expense in the Statement of Financial Performance:

Minimum lease payments (10 927 675) (6 435 200)Total (10 927 675) (6 435 200)

The Legislature has operating lease agreements for the following classes of assets, which are only signifi cant collectively

Buildings and offi ce equipmentThe following restrictions have been imposed on the Legislature in terms of the lease agreements on offi ce equipment:(i) The equipment shall remain the property of the lessor.(ii) The hirer shall not sell, sublet, cede, assign or delegate any of its rights or obligations on the

equipment.(iii) The equipment shall be returned in good order and condition to the lessor upon termination of the

agreement.(iv) The Legislature is obliged to enter into a maintenance agreement with the lessor for the

equipment rented.(v) Operating lease payments represent rentals payable by the Legislature for the offi ce equipment

and rentals of two offi ce buildings (NCOP offi ce in Cape Town and Legislature Satellite Offi ce). Leases of equipment are negotiated for an average term of three years and rentals escalate at an average of 10% annually. The leases of offi ce buildings are negotiated for an average term of fi ve years and rentals escalate at an average of 9% and 10% annually.

13. Accumulated surplus

The accumulated surplus consists of the following:

Accumulated surplus due to the results of operations 12 589 127 1 046 370Total 12 589 127 1 046 370

Refer to Statement of Changes in Net Assets for more detail and the movement on accumulated surplus.

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14. Annual appropriationAdministration 127 584 000 108 085 000Parliamentary Business 139 740 000 121 197 000Total 267 324 000 229 282 000

Included are funds appropriated in terms of the Appropriation Act (and the Adjustment Appropriation Act) for (Voted funds) and the Provincial Legislature.

15. Statutory appropriationSalaries-Members of the Provincial Legislature 23 797 000 22 123 000Total 23 797 000 22 123 000

16. Public contributions and donations

Other donations 250 000 100 000Unconditional contributions 0 939Total 250 000 100 939

Public contributions and donations received in cash were in support of the State of the Province Address.

The Legislature does not recognise donations in kind as revenue. Consumable goods and services were received during the period under review in support of the Legislature events.

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17. Sundry revenue

Revenue from exchange transactionsOther revenue 9 196 13 920Revenue from non-exchange transactionsOther revenue 494 267 125 332Bad debts recovered 112 880Interest earned-debtors 29 858 41 059

646 201 180 311

The amounts disclosed above for other revenue are in respect of amongst other, debt recovered from employees and commission received.

Details of the nature and reasons for reclassifi cation of prior year fi gures are explained under note 36.

18. Interest earnedInterest receivedBank 755 814 538 646Total 755 814 538 648

Interest earned on fi nancial assets, analysed by category of asset, is as follows:

Bank account 755 814 538 646Sundry debtors 29 858 41 059Total 785 672 579 705

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19. Employee related costs

Basic salary 79 920 224 73 733 159Performance bonus 2 144 921 2 013 071Medical aid – employer contributions 4 674 327 3 966 991UIF 294 518 275 239Staff leave accrual 699 420 741 295Pension contributions 10 244 395 10 642 015Overtime payments 1 177 547 2 134 026Long service awards 15 000 13 00013th Cheques 4 588 071 4 112 226Housing benefi ts and allowances 2 877 902 2 558 636Allowances 7 910 130 2 695 870

Total 114 546 455 102 885 528

Prior year fi gures have been reclassifi ed to align to the current year classifi cations for improved reporting.


Remuneration of management personnel

Remuneration of the management and Members of the Legislature aggregates to R40 809 426: 2014/15 and R35 129 712: 2013/14.

Remuneration of the SpeakerAnnual remuneration 1 397 685 1 444 859Car and other allowances 156 023 24 000Total 1 553 708 1 468 859

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Remuneration of the Deputy SpeakerAnnual remuneration 1 006 322 946 229Car and other allowances 177 545 182 143Total 1 183 867 1 128 372

Remuneration of the 17 Public Offi ce Bearers Annual remuneration 14 828 823 13 330 189 Car and other allowances 1 436 154 2 249 580 Total 16 264 977 15 579 769

Remuneration of the Secretary Annual remuneration 733 804 734 622 Car and other allowances 886 235 870 881 Total 1 620 039 1 605 503

Remuneration of the Executive Manager: Financial Governance

Annual remuneration 999 541 984 693 Car and other allowances 117 252 117 252 Total 1 116 793 1 101 945

Remuneration of the Executive Manager: Corporate Services

Annual remuneration 1 036 931 79 963 Car and other allowances 144 000 12 000 Total 1 180 931 91 963

Remuneration of the Executive Manager: Parliamentary Operations

Annual remuneration 781 148 714 199 Car and other allowances 429 642 343 445 Total 1 210 790 1 057 644

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Remuneration of the 16 Senior ManagersAnnual remuneration 12 312 317 10 031 763Car and other allowances 4 366 004 3 063 894Total 16 678 321 13 095 657

20. Depreciation and amortisationDepreciation: Property, plant and equipment 3 606 314 3 622 025Amortisation: Intangible assets 445 710 364 727Total 4 052 024 3 986 752

21. Impairment of assetsProperty, plant and equipment 0 197 997Total 0 197 997

22. Debt impairmentContributions to debt impairment provision 449 524 493 558Total 449 524 493 558

23. Contracted servicesInformation technology 24 704 795 10 435 567Internal audit 2 246 614 1 806 712Professional fees 5 768 018 6 536 702Operating leases 10 735 193 6 567 839Other contractors 19 311 230 26 120 830Total 62 765 850 51 467 650

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24. Transfer paymentsCaucus allowances 17 942 274 10 079 020Constituency allowances 19 915 424 27 075 620Total 37 857 698 37 154 640

25. General expensesAdverting 3 545 373 4 583 480Audit fees 4 099 898 3 923 778Bank charges 237 486 219 786Cleaning material 11 115 8 362Consulting and professional fees 359 896 1 188 638Entertainment 951 323 420 882Translation and transcript 501 356 673 905Hire of venue & facilities 4 331 500 2 556 593Postage & courier 46 283 90 987Printing and publications 4 667 017 5 690 579Subscription and membership fees 1 840 459 1 412 115Communication 2 968 231 2 515 407Transport costs 2 408 327 3 057 751Training 414 911 1 040 782Traveling and subsistence - domestic 16 866 393 21 273 591Traveling and subsistence - foreign 1 535 548 804 920Electricity 4 656 696 4 818 972Uniform and protective clothing 132 585 179 328Bursaries 970 323 438 335Catering 5 525 187 6 955 478Public Offi ce Bearers gratuity payment 2 645 226 1 678 000Other expenses 1 115 483 1 183 243Total 59 830 616 64 714 912



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26. Cash generated from operations Surplus/(defi cit) 13 056 229 (9 668 692)Adjustments for:Depreciation and amortisation 4 052 024 3 986 752Losses on sale of assets 107 929 662 548Impairment defi cit 0 197 997Debt impairment 449 524 493 558Movements in operating lease liabilities (452 133) 161 468Movements in provisions 136 000 2 140 668Changes in working capital:Inventories (62 278) 35 592Debt impairment (449 524) (493 558)Other receivables from non-exchange transactions 203 931 674 280Prepayments (1 503 124) (2 146 218)Payables from exchange transactions (10 038 692) 10 053 062Payables from non-exchange transactions 1 008 121 908 401

6 508 007 7 005 858


Details of the nature and reasons for reclassifi cation of prior year fi gures are explained under Note 36.

27. Unauthorised expenditureReconciliation of unauthorised expenditureOpening balance 1 082 000 1 082 000Unauthorised expenditure current year 0 0Condoned or written-off (1 082 000) 0Unauthorised expenditure awaiting condonation 0 1 082 000

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28. Fruitless and wasteful expenditureReconciliation of fruitless and wasteful expenditureOpening balance 2 605 164 102 000Fruitless and wasteful expenditure current year 0 2 616 232Condoned or written-off (2 573 778) (113 067)Fruitless and wasteful expenditure awaiting condonation 31 387 2 605 165

Details of fruitless and wasteful expenditure

Description/Nature Steps taken No show on accommodation (2013/14) Awaiting condonation 31 387 Total 31 387

29. Irregular expenditureReconciliation of irregular expenditureOpening balance 1 562 117 0Irregular expenditure current year 0 1 562 117Condoned or written-off (1 562 117) 0Irregular expenditure awaiting condonation 0 1 562 117

30. Financial instruments disclosure

Categories of fi nancial instruments31 March 2015Financial assetsIn accordance with GRAP 104.13 the fi nancial assets of the Legislature are classifi ed as follows:

Amortised cost

Total

Receivables from non-exchange transactionsSundry debtors 439 901 439 901Cash and cash equivalents 2 462 119 2 462 119Total 2 902 020 2 902 020

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Financial liabilitiesIn accordance with GRAP 104.13 the fi nancial liabilities of the Legislature are classifi ed as follows:

Amortised cost

Total

Payables from exchange transactions 7 595 247 7 595 247Payables from non-exchange transactionStaff leave accrued 3 356 059 3 356 059Capped leave accrued 3 428 744 3 428 744Staff bonuses 2 574 066 2 574 066Total 16 954 116 16 954 116

Amortised cost

Total

Finance income earned Financial assets 785 672 785 672 Total 785 672 785 672

31 March 2014

Financial assetsIn accordance with GRAP 104.13 the fi nancial assets of the Legislature are classifi ed as follows:

Amortised cost

Total

Receivables from non-exchange transactionsSundry Debtors 578 060 578 060Cash and cash equivalents 2 036 521 2 036 521Total 2 614 581 2 614 581

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Financial liabilitiesIn accordance with GRAP 104.13 the fi nancial liabilities of the Legislature are classifi ed as follows:

Amortised cost

Total

Payables from exchange transactions 17 633 938 17 633 938Payables from non-exchange transactionStaff bonuses 2 199 590 2 199 590Staff leave accrued 2 971 764 2 971 764Capped leave accrued 3 176 944 3 176 944Staff salary 2 450 2 450 Total 25 984 686 25 984 686

Amortised cost

Total

Finance incomearned Financial assets 579 705 579 705 Total 579 705 579 705

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31. Fair values of fi nancial assets and liabilities

31 March 2015 31 March 2014Carrying amounts

Fair value Carrying amounts

Fair value

Receivables from non-exchange transactions 439 901 439 901 578 060 578 060Cash and cash equivalents 2 462 119 2 462 119 2 036 521 2 036 521Total fi nancial assets 2 902 020 2 902 020 2 614 581 2 614 581Payables from exchange transactions (7 595 247) (7 595 247) (17 633 938) (17 633 938)Payables from non-exchange transactions (9 358 869) (9 358 869) (8 350 748) (8 350 748)

(14 052 096) (14 052 096) (23 370 105) (23 370 105)

32. Capital risk managementThe Legislature manages its capital to ensure that it is able to continue as a going concern while executing its constitutional mandate.

The capital structure of the Legislature consists of equitable share appropriated, which includes cash and cash equivalents, comprising funds and accumulated surplus as disclosed in note 13 and the Statement of Changes in Net Assets.

The Legislature has adequate capital to net its fi nancial obligations and is exposed to this risk only to a limited extent.

Financial risk management objectives The Accounting Offi cer has overall responsibility for the establishment of the Legislature’s risk management framework.

Due to the largely non-trading nature of activities and the way in which they are fi nanced, the Legislature is not exposed to the degree of fi nancial risk faced by business entities. Financial instruments play a much more limited role in creating or changing risks that would be typical of listed companies to which the International Accounting Standards mainly apply. Generally, fi nancial assets and liabilities are generated by day-to-day operational activities and are not held to manage the risks facing the Legislature in undertaking its activities.

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Management monitors and manages the fi nancial risks relating to the operations through internal policies and procedures. These risks include interest rate risk, credit risk and liquidity risk. Compliance with policies and procedures is reviewed by the internal auditors on a continuous basis, and annually by external auditors.

Internal audit and risk management functions are responsible for initiating a control framework and monitoring and responding to potential risk. Reports are presented periodically to the Legislature’s Audit Committee.

Further quantitative disclosures where applicable are included throughout these fi nancial statements.

Liquidity risk

Liquidity risk is the risk that the Legislature will encounter diffi culty in meeting the obligations associated with its fi nancial liabilities that are settled by delivering cash or another fi nancial asset. The Legislature’s approach to managing liquidity is to ensure, as far as possible, that it will always have suffi cient budget and cash to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Legislature’s reputation

Credit risk

Credit risk is the risk of fi nancial loss to the Legislature if counterparty to a fi nancial instrument fails to meet its contractual obligations and arises principally from the Legislature’s receivables.

Market risk

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Legislature’s income or the value of its holdings in fi nancial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return.

The Legislature’s activities expose it to a limited extent to the fi nancial risks of changes in interest rates. No formal policy exists to hedge volatilities in the interest rate market.

There has been no change to the Legislature’s exposure to market risks or the manner in which it manages and measures the risk.

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Foreign currency risk management

The Legislature’s activities do not signifi cantly expose it to the fi nancial risks of foreign currency and therefore has no formal policy to hedge volatilities in the interest rate market.

Interest rate risk management

Interest rate risk is defi ned as the risk that the fair value or future cash fl ows associated with a fi nancial instrument will fl uctuate in amount as a result of market interest changes.

Potential concentrations of interest rate risk consist mainly of variable rate deposit investments, long-term receivables, consumer debtors, other debtors, bank and cash balances.

In the case of debtors whose accounts become in arrears, it is endeavoured to collect such accounts by levying of interest.

Long-term receivables and other debtors are individually evaluated annually at reporting date for impairment or discounting. A report on the various categories of debtors is drafted to substantiate such evaluation and subsequent impairment/discounting, where applicable.

The Legislature is not exposed to credit interest rate risk as it has no borrowings.

Credit Risk Management

Credit risk refers to the risk that a counter party will default on its contractual obligations resulting in fi nancial loss to the Legislature.

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Cash and cash equivalents

The Legislature has a business bank account with First National Bank. No investments with fi nancial institution have been made.

The maximum credit and interest risk exposure in respect of the relevant fi nancial instruments is as follows:

Receivables from non-exchange transactions 439 901 578 060Cash and cash equivalents 2 462 119 2 036 521Maximum credit and interest risk exchange 2 902 020 2 614 581

33. Related party transactions

The maximum credit and interest risk exposure in respect of the relevant fi nancial instruments is as follows:

Purchase from related parties

The Legislature paid for services from the following entities, which are considered to be related parties:

Entity Name

Mpumalanga Department of Community Safety, Security and Liaison 16 500 0Department of Public Works, Roads and Transport 4 062 561 6 169 748Total 4 079 061 6 169 748

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The transactions were concluded in full compliance with the Legislature’s Supply Chain Management Policy and the transactions are considered to be at arm’s length. The transactions with the Department of Public Works, Roads and Transport were for municipal and communication services. The transactions with the Department of Community Safety, Security and Liaison were for motor vehicle licences.

Other related party transactions

In addition to the above, the Legislature occupies a building that belongs to the Department of Public Works, Roads and Transport. The Legislature has use of the property at no consideration (i.e. Rental at market related prices), but it is however, liable for the maintenance thereof.

There is an outstanding amount of R1 727 487 due to the Department of Public Works, Roads and Transport as at 31 March 2015. There were no outstanding transactions with the Department of Community Safety, Security and Liaison.

Key management

Transactions with key management personnel are disclosed in note 19: Employee costs.

34. Employee benefi ts

Defi ned contribution plan

Retirement benefi ts are provided by membership of the Government Employees Pension Fund and Political Offi ce Bearers Pension Fund which are defi ned benefi t funds. The Legislature’s responsibility regarding the funding of the pension funds is limited to the current contributions made on behalf of its employees. The obligation of the fund is guaranteed by the National Revenue Fund and not by the individual government departments and entities.

Contributions to the GEPF for the reporting period 15 398 964 14 987 712Total 15 398 964 14 987 712

These contributions are included in the surplus or defi cit for the reporting period.

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35 Correction of prior year error

Adjustments to prior year balances:

The prior year fi gures of classes in the Statement of Financial Position have been restated to correctly classify the nature of assets, liability and net assets of the Legislature.

Corrections were made during the current fi nancial year. Details of the corrections are described below:

(i) Adjustment of receivables incorrectly recognised in 2012/13 fi nancial year.(ii) On property, plant and equipment the adjustment is as a result of an asset not properly recorded in the asset register or the annual fi nancial statements.(iii) Payables from exchange transactions and general expenses have increased due to restatement of accruals not previously reported.(iv) Provision and expenditure for long service previously not reported has been restated.

(iv) Provision and expenditure for gratuity previously not reported has been restated.The impact of this, with the related adjustment to the prior year’s fi gures, are stated below:

Prior year Current year Restated Balance Balance Amount

The effect of the correction of error is as follows:

Receivables from non-exchange transactions 379 208 (369 208) (10 000)

Property, plant and equipment 14 114 130 (14 548 705) 434 575Depreciation and amortisation 3 846 752 (3 986 752) 140 000

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Payables from exchange transactions 17 529 411 (17 633 938) 104 527General expenses 114 400 032 (114 504 561) 104 527Accumulated surplus – balance at 01 April 2013 15 988 487 (16 553 062) 564 575

Public Offi ce Bearers gratuity payments 0 (1 678 000) 1 678 000Long service awards 0 (13 000) 13 000Provision for long service awards 0 (106 000) (106 000)Provision for gratuity 0 (4 852 000) (4 852 000)

166 258 020 (174 245 226) (1 928 796)

Disclosure adjustments:

(i) Correction of contribution to pension fund due to omission of employee contributions to pension fund.

(ii) Correction of related party transaction note due to omission of prior accrual expenditure included in the current year.

(iii) Correction of remuneration for management personnel due to omission of remuneration of the Senior Managers.

Contribution to pension funds (10 642 015) 14 987 712 4 345 697Remuneration of 16 Senior Managers 0 13 095 657 13 095 657Related party transactions (3 857 796) 6 169 748 2 311 952Total (14 499 811) 34 253 117 19 753 306

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36. Reclassifi cations of prior year fi gures

The following prior year fi gures have been reclassifi ed to align with the current year reporting item classifi cations. The reasons for this reclassifi cation is for improved reporting, and the details are explained below:

General expenses Previously reported

Reclassifi ed Difference

Travel and subsistence 22 045 592 0 22 045 592Travel and subsistence - domestic 0 (21 240 672) (21 240 672)Travel and subsistence - foreign 0 (804 920) (804 920)Total 22 045 592 (22 045 592) 0

This reclassifi cation separates the travel and subsistence - domestic and travel and subsistence - foreign which were both previously reported under travel and subsistence in the prior year fi gures. There is no effect on Net Surplus.

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Legal costs 876 207 - 876 207Professional fees 312 431 - 312 431Consulting & professional fees 0 (1 188 638) (1 188 638)Computer services 9 488 383 0 9 488 383Licence fees 897 211 0 897 211Contracted services-other contractors - (10 385 594) (10 385 594)Communication 6 262 297 (2 515 407) 3 746 890Contract: communication 0 (3 429 690) (3 429 690)Contract. telephone installation 0 (73 045) (73 045)Postage and courier 0 (25 252) (25 252)Catering 10 821 590 (6 955 478) 3 866 112Contract : catering (3 866 112) (3 866 112)Hire of venues & facilities 2 330 465 (2 549 368) (218 903)Other general expenses 1 857 149 (1 183 243) 673 906Translation & transcript 0 (673 906) (673 906)Transport 4 019 825 (3 043 341) 976 484Other contract: fuel, oil and grease 0 (976 484) (976 484)Operating leases 6 567 839 0 6 567 839Contract: operating lease 0 (6 567 839) (6 567 839)Total 43 433 397 (43 433 397) 0

Legal costs and professional fees, which were previously reported separately, have been reclassifi ed into consulting and professional fees. . Computer services have been reclassifi ed from general services to contracted services. Communications has been reclassifi ed to correctly report postage, hire of venues and facilities, contracted communications and contracted telephone installation. Other and general expenses were reclassifi ed to report translation and transcript separately. Operating leases have been reclassifi ed from general expenses to contract. Fuel, oil and grease have been reclassifi ed from general expenses to contracted. There is no effect on Net Surplus

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Impairment losses 691 556 0 691 556Impairment loss/reversal of impairment - PPE 0 (197 997) (197 997)Debt impairment 0 (493 559) (493 559)Total 691 556 (691 556) 0

The reclassifi cation separates impairment loss and bad debts whereas these were reported as impairment losses. The reason for this reclassifi cation is to clearly indicate the effects of impairments on debtors and on capital assets. There is no effect on Net Surplus.

Receivables from non-exchange transactions

Previously reported


Receivable from non - exchange transactions 2 734 278 (578 060) 2 156 218Prior error - sundry debts 0 (10 000) (10 000)Prepayments 0 (2 146 218) (2 146 218)Revenue from non - exchange transactions 0 0 0Sundry revenue 0 (166 391) (166 391)

Revenue from exchange transactions 0 0 0Sundry revenue 139 252 (13 920) 125 332Interest earned 579 705 (538 646) 41 059Total 3 453 235 (3 453 235) 0

The reclassifi cation reports prepayments separately whereas these were reported as receivables from non-exchange transactions, and also sundry revenue has been split into revenue from exchange and non-exchange transactions. There is no effect on Net Surplus.

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Cash fl ow from operating activities -liabilities Previously reported


Contributions to provisions - current 2 007 497 0 2 007 497Expenditure incurred on provisions (1 557 829) 0 (1 557 829)Movement in provisions 0 (449 668) (449 668)

Cash fl ow from operating activities - Payments 127 809 702 0 127 809 702Suppliers 15 591 978 (103 676 040) (88 084 062)Transfer to Treasury 0 (2 571 000) (2 571 000)Transfer payments 0 (37 154 640) (37 154 640)Total 143 851 348 (143 851 348) 0

Cash fl ow from fi nancing activities Previously reported


Transfer to Treasury for re-appropriation 0 (2 571 000) (2 571 000)Total 0 (2 571 000) (2 571 000)

A transfer to Treasury is accounted for separately under cash fl ows from fi nancing activities, which was previously reported under cash generated by operations. This then increases the total cash generated from operations by the amount of R2 571 000 to R7 005 859 from R4 434 859. There is no effect on Net Surplus.

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Employee related costs Previously reported


Employee related costs - salaries and wages 78 586 680 0 78 586 68013th Cheque 0 (4 112 226) (4 112 226)Basic salary 0 (73 733 159) (73 733 159)Leave pay provision charge 0 (741 295) (741 295)Employee related costs - contributions for UIF, pensions and medical aid 14 884 244 0 14 884 244Medical aid - contribution 0 (3 966 991) (3 966 991)UIF 0 (275 239) (275 239)Pension contributions 0 (10 642 014) (10 642 014)Performance bonuses 455 242 (2 013 071) (1 557 829)Allowances 4 253 699 (2 695 870) 1 557 829Total 98 179 865 (98 179 865) 0

Prior year balances for 13th cheque, basic salary and leave pay provision which were reported in one fi gure under the item employee related costs - salaries and wages. Medical aid contributions, UIF and pension contributions were reported in one fi gure under the item employee related costs - contribution for UIF, pensions and medical aid. Correction of expenditure for performance bonus previously reported as part of allowances.

Cash fl ow from operating activities Previously reported


Other receivables from no-exchange transactions 1 965 497 (674 280) 1 291 217Debt impairment 0 (493 558) (493 558)Total 1 965 497 (1 167 838) 797 659

Prior year amounts for movement on receivables from non - exchange transactions are separated into debtors and provision for impairment. This has no effect on net surplus/defi cit.

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37. Events after the reporting date

Non adjusting

The Legislature awarded a bid for the revamp of the Chamber system in the fi rst quarter of the 2015/2016 fi nancial year. The bid was advertised in the fourth quarter of the reporting period, following the appropriation of additional funds for this system on the Adjustment Appropriation. The revamp of the system is expected to cost an estimate amount of R13 901 938 and the system is expected to improve the operations particularly the Sittings convened in the Legislature Chamber.

The position of the Secretary to the Legislature was fi lled in the month of July 2015.

38. GRAP Standards approved but not yet effective

The following GRAP standards have been issued by the Minister of Finance but are not yet effective and have not been adopted by the Legislature:(i) GRAP 20 Related Party Disclosures (Revised).(ii) GRAP 32 Service Concession Arrangement Grantor.(iii) GRAP 108 Statutory Receivables.

The Accounting Standard Board Directive 5 paragraph 29 sets out the principles for the application of GRAP 3: Guidelines in the determination of the GRAP Reporting Framework hierarchy, as set out in the standard of GRAP 3 on Accounting Policies, changes in accounting estimates and errors.

The Legislature applied the principles established in the following standards of GRAP that have been issued, but is not yet in effect, in developing appropriate accounting policies dealing with the following transactions, but have not early adopted these Standards: Related Parties - GRAP 20.

Management has considered all of the above-mentioned GRAP standards issued but not yet ef-fective and anticipates that the adoption of these standards will not have a signifi cant impact on the fi nancial position, fi nancial performance or cash fl ows of the Legislature.

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39. GRAP Standards approved and effective

Where a standard of GRAP is approved as effective, it replaces the equivalent statement of Inter-national Public Sector Accounting Standards Board, International Financial Reporting Standards or Generally Accepted Accounting Principles. Where a standard of GRAP has been issued, but is not yet in effect, an entity may select to apply the principles established in that standard in devel-oping an appropriate accounting policy dealing with a particular section or event before applying paragraph 12 of the Standard of GRAP on Accounting Policies, changes in accounting estimates and errors.

These standards are approved and effective as from 01 April 2015:(i) GRAP 18 Segment Reporting - issued March 2005.(ii) GRAP 105 Transfers between entities under common control - issued November 2010.(iii) GRAP 106 Transfers between entities not under common control - issued November 2010.(iv) GRAP 107 Mergers - issued November 2010.

40. Going concern assessment

There are no uncertainties that may cast signifi cant doubts upon the entity’s ability to continue as a going concern in the future.

(i) The establishment and continuing operations of the Legislature are set out in the Constitution of the Republic.

(ii) The Legislature has adopted a fi ve-year strategic plan and a three-year rolling annual performance plan.

(iii) The Mpumalanga Provincial Legislature has appropriated a three-year rolling budget in accordance with the Medium Term Expenditure Framework.

(iv) Management has thus prepared these Financial Statements on the Going Concern Basis for the next 12 months.

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41. Contingent assets and liabilities

The Legislature was not engaged in any transaction or event during the year under review involving contingent assets and liabilities.

42. Capital commitments

The Legislature did not engage in transactions or events incurring fi nancial implications as at the end of the reporting date.

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SUPPLEMENTARY INFORMATION TO THE ANNUAL FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31 MARCH 2015


1. Fruitless and wasteful expenditureReconciliation of fruitless and wasteful expenditureFruitless and wasteful expenditure 42 292Condoned (6 064)Total 36 208

Details of fruitless and wasteful expenditure Steps taken

Duplicate payment (2014/2015) Under investigation 1 558No shows on accommodation (2014/2015) Awaiting condonement 24 446Damage on rented vehicle (2014/2015) Awaiting condonement 10 204Total 36 208

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

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