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Joe Gqabi GRAP 30 June 2020

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Joe Gqabi GRAP 30 June 2020 ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2020 JOE GQABI DISTRICT MUNICIPALITY INDEX Content Page General Information 1 - 3 Report of the Auditor General Approval of the Financial Statements 4 Statement of Financial Position 5 Statement of Financial Performance 6 Statement of Changes In Net Assets 7 Cash Flow Statement 8 Statement of comparison of budget and actual amounts - Statement of Financial Position 9 - 10 - Statement of Financial Performance 11 - 12 - Cash Flow Statement 13 - 14 Notes to the Financial Statements - Accounting Policies 15 - 47 Notes to the Financial Statements 48 - 110 APPENDICES - Unaudited A Schedule of External Loans 111 B Disclosure of Grants and Subsidies 112 __________________________ JOE GQABI DISTRICT MUNICIPALITY GENERAL INFORMATION NATURE OF BUSINESS Joe Gqabi District Municipality performs the functions as set out in the Constitution. (Act no 108 of 1996) LEGAL FORM South African Category C Municipality (District Municipality) as defined by the Municipal Structures Act. (Act no 117 of 1998) JURISDICTION The Joe Gqabi District Municipality includes the following areas: Walter Sisulu Local Municipality (Burgersdorp, Venterstad, Steynsburg, Aliwal North and Jamestown) Senqu Local Municipality (Lady Grey, Sterkspruit, Rhodes, Rossouw, Herschel and Barkly East) Elundini Local Municipality (Maclear, Ugie and Mount Fletcher) MEMBERS OF THE MAYORAL COMMITTEE Position Councillor Ward Executive Mayor Z I Dumzela Speaker T Z Notyeke Councillor E M Lakabane Portfolio head: Financial Services Councillor S Mei Portfolio head: Technical Services Councillor L M Tokwe Portfolio head: Corporate Services Councillor D D Mvumvu Portfolio head: Community Services MUNICIPAL MANAGER Mr Z A Williams CHIEF FINANCIAL OFFICER Ms S du Toit OTHER DIRECTORS AND SENIOR MANAGERS DIRECTLY REPORTING TO THE ACCOUNTING OFFICER Mr R J Fortuin - Director: Technical Services Ms F J Sephton - Director: Community Services Mr H Z Jantjie - Director: Corporate Services Mr M Nonjola - Director: Institutional support and advancement Ms N Mshumi - Chief Operations Officer Mr D Lusawana - Manager Water Service provider __________________________ Page 1 JOE GQABI DISTRICT MUNICIPALITY GENERAL INFORMATION REGISTERED OFFICE C/o Cole and Graham Street, Barkley East, 9786 POSTAL ADDRESS P/Bag X102, Barkley East, 9786 AUDITORS Office of the Auditor General (EC) PRINCIPLE BANKERS ABSA, PO Box 323, Bloemfontein, 9300 ATTORNEYS Vuba Incorporated, Mtatha AUDIT COMMITTEE C Sparg - Chairperson L Smith - Member A Jordan - Member H Marsberg - Member RELEVANT LEGISLATION Municipal Finance Management Act (Act no 56 of 2003) Division of Revenue Act The Income Tax Act Value Added Tax Act Municipal Structures Act (Act no 117 of 1998) Municipal Systems Act (Act no 32 of 2000) Municipal Planning and Performance Management Regulations Water Services Act (Act no 108 of 1997) Housing Act (Act no 107 of 1997) Municipal Property Rates Act (Act no 6 of 2004) Electricity Act (Act no 41 of 1987) Skills Development Levies Act (Act no 9 of 1999) Employment Equity Act (Act no 55 of 1998) Unemployment Insurance Act (Act no 30 of 1966) Basic Conditions of Employment Act (Act no 75 of 1997) Supply Chain Management Regulations, 2005 Labour Relation Amendment Act (Act 6 of 2014) Collective Agreements Infrastructure Grants SALBC Leave Regulations Municipal Budget and Reporting Regulations Municipal Regulation on Standard Chart of Accounts (mSCOA) __________________________ Page 2 JOE GQABI DISTRICT MUNICIPALITY GENERAL INFORMATION RELEVANT LEGISLATION (CONTINUED) Disaster Management Act 57 of 2002 Fire Brigade Services Act 99 of 1987 Foodstuffs, Cosmetics and Disinfectants Act 54 of 1972 National Veld and Forest Fire Act 101 of 1998 National Water Act 36 of 1998 National Health Act of 1997 Occupational Health and Safety Act and Regulation 85 of 1993 Municipal Cost Containment Regulations, 2019 MEMBERS OF THE JOE GQABI DISTRICT MUNICIPALITY COUNCIL - PROPORTIONAL ELECTED COUNCILLORS Executive Mayor Z I Dumzela Speaker T Z Notyeke Councillors: JGDM EM Lakabane D Mvumvu S Mei L Tokwe NU Hlathuka N Ngendane AM van Zyl M Yiliwe MEMBERS OF THE JOE GQABI DISTRICT MUNICIPALITY COUNCIL - REPRESENTATIVE COUNCILLORS Senqu Local Municipality AP Kwinana M Phuza NP Mposelwa VV Stokhwe XG Magcai NM Phama Elundini Local Municipality B Msuthwana (Resigned on 30/07/2019) Z Mampintsha (Sworn in on 30/07/2019) M Telile M Marubela L Booka (Resigned on 30/07/2019) S Mdoda (Sworn in on 30/07/2019) L Pili N Ntaopane Walter Sisulu Local Municipality DF Hartkopf (Resigned on 3/10/2019) V Davids L Nkunzi E Theron (Sworn in on 30/01/2020) __________________________ Page 3 JOE GQABI DISTRICT MUNICIPALITY APPROVAL OF FINANCIAL STATEMENTS APPROVAL OF ACCOUNTING OFFICER I am responsible for the preparation of these annual financial statements year ended 30 June 2020, which are set out on pages 1 to 112 in terms of Section 126 (1) of the Municipal Finance Management Act and which I have signed on behalf of the Municipality. The annual financial statements have been prepared in accordance with GRAP. I acknowledge that I am ultimately responsible for the system of internal financial control and that the system of internal control provides reasonable assurance that the financial records can be relied on. I have reviewed the Municipality’s cash flow forecast for the year to 30 June 2021 and am satisfied that the Municipality can continue in operational existence for the foreseeable future. The external auditors are responsible for independently reviewing and reporting on the Municipality’s financial statements. I certify that the remuneration of Councillors and in-kind benefits are within the upper limits of the framework envisaged in Section 219 of the Constitution, read with the Remuneration of Public Officer Bearers Act and the Minister of Provincial and Local Government's determination in accordance with this Act. As per Government Gazette no. 43582 dated 5th August 2020, National Treasury has granted municipalities and municipal entities a two-month extension regarding the submission of AFS. The municipality has taken advantage of this exemption. Mr Z A Williams Date Municipal Manager __________________________ Page 4 JOE GQABI DISTRICT MUNICIPALITY STATEMENT OF FINANCIAL POSITION AT 30 JUNE 2020 2020 2019 R R Notes (Actual) (Actual) ASSETS Total Current Assets 315 655 209 230 904 412 Current Assets 23 709 510 7 022 616 Cash and Cash Equivalents 2 21 523 934 4 845 072 Inventory 3 2 185 576 2 177 544 Current Assets from Exchange Transactions 278 171 640 213 270 410 Receivables from Exchange Transactions 4 278 171 640 213 270 410 Current Assets from Non-Exchange Transactions 13 774 059 10 611 386 Unpaid Conditional Government Grants 5 13 774 059 10 611 386 Total Non-Current Assets 1 757 789 036 1 774 085 341 Non-Current Investments 6 3 759 509 3 665 509 Investment Property 7 2 347 732 2 393 352 Property, Plant And Equipment 8 1 751 672 050 1 768 008 984 Intangible Assets 9 9 745 17 496 Total Assets 2 073 444 245 2 004 989 753 Total Current Liabilities 162 051 290 156 882 561 Current Liabilities 38 408 282 31 841 051 Current Employee Benefits 10 38 408 282 31 841 051 Current Liabilities from Exchange Transactions 121 428 476 117 281 386 Current Portion of Long-Term Liabilities 11 603 599 2 625 487 Consumer Deposits 12 1 029 952 975 566 Payables from Exchange Transactions 13 115 738 923 108 143 168 South African Revenue Services 14 4 056 003 5 537 165 Current Liabilities from Non-Exchange Transactions 2 214 532 7 760 124 Unspent Conditional Government Grants 15 2 214 532 7 760 124 Total Non-Current Liabilities 31 752 973 38 677 453 Non-Current Liabilities 29 028 534 35 131 063 Employee Benefits 16 29 028 534 35 131 063 Non-Current Liabilities from Exchange Transactions 2 724 440 3 546 390 Long-Term Liabilities 11 2 724 440 3 546 390 Total Liabilities 193 804 263 195 560 014 Net Assets 1 879 639 982 1 809 429 739 Community Wealth Accumulated Surplus 17 1 879 639 982 1 809 429 739 Total Community Wealth 1 879 639 982 1 809 429 739 __________________________ Page 5 JOE GQABI DISTRICT MUNICIPALITY STATEMENT OF FINANCIAL PERFORMANCE FOR THE YEAR ENDING 30 JUNE 2020 2020 2019 R R REVENUE Notes (Actual) (Actual) REVENUE FROM NON-EXCHANGE TRANSACTIONS 569 868 066 538 585 475 Transfer Revenue 558 095 322 533 532 202 Government Grants and Subsidies - Capital 18 130 682 148 127 552 820 Government Grants and Subsidies - Operating 18 427 413 174 405 334 383 Public Contributions and Donations - Operating 19 - 645 000 Other Revenue 11 772 744 5 053 273 Actuarial Gains 20 11 698 324 4 951 029 Inventory Adjustments 21 74 420 102 244 REVENUE FROM EXCHANGE TRANSACTIONS 162 557 602 159 778 774 Operating Activities 162 557 602 159 778 774 Service Charges 22 123 252 192 124 541 317 Interest Earned - External Investments 23 2 399 572 3 255 361 Interest Earned - Outstanding Debtors 24 36 584 550 31 364 363 Other Income 25 321 287 617 733 TOTAL REVENUE 732 425 668 698 364 249 EXPENDITURE Employee Related Costs 26 238 217 407 222 350 946 Remuneration of Councillors 27 6 056 030 5 979 722 Debt Impairment 28 63 821 053 71 724 178 Depreciation and Amortisation 29 123 915 975 54 752 453 Repairs and Maintenance 30 8 065 886 12 509 260 Finance Charges 31 4 246 367 5 302 597 Bulk Purchases 32 6 628 169 5 742 801 Contracted Services 33 12 881 720 16 227 167 Transfers and Grants 34 6 610 114 8 900 000 Operating grant expenditure 35 96 651 271 76 676 315 Other Expenditure 36 93 942 861 114 832 943 Loss on Disposal of PPE 37 1
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