Annual Report 2010/2011

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA

ANNUAL REPORT 2010/2011

REPUBLIC OF SOUTH AFRICA 1

CONTENTS

1. GENERAL INFORMATION 2 2. ORGANISATIONAL STRUCTURE 2.1 Organogram 3 2.2 Council 4 3. LEGISLATIVE MANDATE 5 4. CHAIRPERSON’S OVERVIEW 7 5. CHIEF EXECUTIVE OFFICER’S REPORT 9 6. INFORMATION ON PREDETERMINED OBJECTIVES 11 7. ICASA DIVISIONS 14 7.1 CORE FUNCTIONS 7.1.1 Licensing and Compliance 15 7.1.2 Markets and Competition 19 7.1.3 Engineering and Technology 24 7.1.4 Consumer Affairs 28 7.2 SUPPORT FUNCTIONS 9LNPVUHS6MÄJLZ 7.2.2 Legal and Complaints and Compliance Committee 35 7.2.3 Human Resources 43 7.2.4 Communications and International Relations 46 7.2.5 Administration 48 7.2.6 Information Technology and Services 49 8 PERFORMANCE TABLES 50 9 ANNUAL FINANCIAL STATEMENTS 95 1. GENERAL INFORMATION

Vision

To be a catalyst in the transformation of South Africa into an information-oriented society with a knowledge-based economy.

Mission

To create a competitive environment for delivering a wide range of high quality communication and postal services at affordable prices to assist in the overall economic growth and social development of the country.

Values

Sharing a Common Vision. Encouraging Systems Thinking. Demystifying Myths.

Strategic Objectives

Increase the availability and quality of electronic communication services and business users; Encourage and maintain a pro-competitive market through effective competition and transparent regulation; Develop regulatory policies that promote competition, innovation and investment in services and facilities providing widespread access to ICT; Maximise the net economic and social worth of the sector, including its strategic use as a catalyst for economic, social and technological development in other areas of the economy; Broaden economic participation in the sector by SMME’s; Encourage the injection of capital by domestic and foreign investors; and Encourage and support the successful introduction of new technologies and services.

2 3 SM: REGIONS SM: CLR: N Batyi CLR: W Stucke W CLR: CLR: N Ndhlovu CLR: T Makhakhe T CLR: RELATIONS GM: LEGAL & CCC & INTERNATIONAL INTERNATIONAL & SM: COMMUNICATIONS COMMUNICATIONS SM: SECRETARY CORPORATE CORPORATE AFFAIRS GM: GM: GM: CONSUMER CONSUMER GM: ADMINISTRATION CEO GM: GM: COUNCIL T DLAMINI TECHNOLOGY DR S MNCUBE CHAIRPERSON CHAIRPERSON ENGINEERING & GM: HUMAN RESOURCES RESOURCES RISK & AUDIT & RISK COMPETITION GM: MARKETS & MARKETS & GM: GM: COMPLIANCE, COMPLIANCE, GM: OFFICER COMPLIANCE CHIEF FINANCIAL FINANCIAL CHIEF GM: LICENSING & LICENSING GM: CLR: CLR: SM: SM: CLR: W Currie DR M Socikwa M DR CLR: J Lebooa TECHNOLOGY INFORMATION CLR: F Sibanda 2 2 STRUCTURE ORGANISATIONAL Organogram 2.1 2.2 Council

+Y:[LWOLU4UJ\IL*OHPYWLYZVUPUJVTPUN 1\S`¶1\UL

4Y;OHIV4HROHROL 1\S` ¶1\UL

4Y-\UNHP:PIHUKH 1\S` ¶1\UL 4Z5VT]\`PZV)H[`P 1\S` ¶1\UL 4Y1VZLWO3LIVVH 6J[VILY¶:LW[LTILY

4Y>PSSPHT*\YYPL 6J[VILY¶:LW[LTILY 4Z5[VTIPaVK^H5KOSV]\ 5V]LTILY¶6J[VILY 4Y>PSSPHT:[\JRL 1HU\HY`¶6J[VILY +Y4HYJPH:VJPR^HZLY]PUNZLJVUK[LYT (WYPS¶4HYJO

4Y7HYPZ4HZOPSL*OHPYWLYZVUV\[NVPUN 1\S`¶1\UL 4Z)YLUKH5[VTILSH 6J[VILY¶:LW[LTILY 4Y9VILY[5R\UH 6J[VILY¶:LW[LTILY

7YVMLZZVY1HJVI\Z]HU9VV`LU:* 6J[VILY¶:LW[LTILY

4 5

3. LEGISLATIVE MANDATE

The Authority derived its mandate from the following legislation: 3.3. The Independent Communications Authority of South Africa, Act of 3.1. The Constitution of the Republic of 2006 (ICASA Amendment Act) South Africa The primary object of this Act is to provide for the regulation The Constitution of the Republic of South Africa (RSA) and control of telecommunication matters in the public places a duty on Parliament “to establish an independent interest (S2). It seeks, among others, to promote the regulatory institution which is required to provide for universal and affordable provision of telecommunication the regulation of broadcasting in the public interest services; and and to ensure fairness and a diversity of views broadly The Act established the South African Communications representing South African society” (S192). Parliament Authority, and this regulator shall be independent and OHZ KLLTLK P[ Ä[ [V HKK [OL YLN\SH[PVU VM LSLJ[YVUPJ impartial (S3). communications and postal services to this function; ICASA is a licensing body, a regulator and a quasi-judicial body because it licences, regulates, adjudicates and 3.4. The Electronic Communications Act, issues sanctions (S34); No 36 of 2005 (ECA) ICASA is also an organ of state bound by the Bill of Rights The substantive regulatory function of ICASA is pertaining (S8); and to broadcasting, postal services and the electronic “The work of ICASA is aimed at the protection of communications sectors; democracy and ensuring free and open airwaves and ICASA plays a concurrent function with the Competition access to communication”. Commission on competition matters (Chapter 10); The Code and mechanism of the National Association of 3.2. The Broadcasting Act of 2002 Broadcasters on content regulation has been approved by ICASA (S54 (2)); and The Act amended the Independent Broadcasting ICASA strives to create an appropriate and predictable Authority (IBA) Act of 1993, sought to clarify the powers regulatory environment to achieve the stated objects of of the Minister and the regulator; and the EC Act of 2005, section 2 (S2). The Act called for a new Broadcasting Policy that will, among others, contribute to democracy, development of society, gender equality, nation building, provision of 3.5. The Competition Act of 1998 LK\JH[PVUHUKZ[YLUN[OLUPUN[OLZWPYP[\HSHUKTVYHSÄIYL The Competition Commission and Competition Tribunal of society. play a complementary role or co-jurisdiction role with ICASA on competition matters within the electronic communications environment (S82 (1)); and The Competition Commission holds an ex post jurisdiction over competition related matters. ICASA holds an ex ante and ex post jurisdiction over competition related matters.

3.6. The Postal Services Act, No 124 of 1998 The Postal Services Act requires the Authority to licence HUKTVUP[VY[OL:V\[O(MYPJHU7VZ[6MÄJLPUYLSH[PVU[V the achievement of customer care standards and the provision of universal service obligations, including the roll-out of street address delivery and the provision of retail postal services in under-service areas.

3.7. The Promotion of Administration Justice Act, No 3 of 2000 (PAJA) PAJA binds ICASA in its deciding functions and the Complaints and Compliance Committee in the exercise of their administrative and judicial functions.

6 7

4. CHAIRPERSON’S OVERVIEW

It is indeed a great pleasure for me to account to the Minister From a regulatory standpoint, the Authority published and of Communications and to Parliament – as the representative introduced the much-awaited Call Termination Regulations of the South African public - about the regulatory activities and that reduced the wholesale costs for terminating a call over deliverables of the Independent Communications Authority of H [OYLL`LHY WLYPVK ;OL IH[[SL [V ÄUHSS` YLK\JL [OL JVZ[ VM :V\[O(MYPJHMVY[OLÄUHUJPHS`LHY communications starts at the wholesale network level, and that provides a launching pad for reducing retail costs. My term as Chairperson commenced on 1 July 2010, after T` WYLKLJLZZVY 4Y 7HYPZ 4HZOPSL JVTWSL[LK OPZ Ä]L`LHY The Authority was on call to ensure the transmission of incident- term. Four Councillors, namely Mr Robert Nkuna, Ms Brenda free terrestrial and celestial signals from the 2010 FIFA World Ntombela, Professor Kobus van Rooyen and Dr Marcia Socikwa Cup to billions of television viewers around the world. completed their four-year terms as well. Mr Karabo Motlana’s, [OLMVYTLY*OPLM,_LJ\[P]L6MÄJLY[OYLL`LHYJVU[YHJ[HSZV The role of the Authority in supporting the country’s constitutional expired during the year. This was indeed a changing of the and democratic dispensation was evident during the 2011 guard in the true sense of the statement. Municipal Elections. ICASA published the 2011 Municipal Elections that provided the guidelines for free and fair broadcast ;OL [YHUZP[PVU ^LU[ Z^PM[S` HZ UL^ *V\UJPSSVYZ [VVR VMÄJL [V LSLJ[PVULLYPUNMVY[OLILULÄ[VMIV[O[OL:V\[O(MYPJHUW\ISPJ ÄSS\W[OL]HJHUJPLZ0OHK[OLOVUV\Y[V^LSJVTL4Y1VZLWO and the political parties. Lebooa, Mr William Currie, Ms Ntombizodwa Ndhlovu and Mr William Stucke. Dr Marcia Socikwa was re-appointed in March The year 2010/11 will go down in ICASA history as the year 2011. Equally important, Mr Themba Dlamini was also brought in which we took matters affecting persons with disabilities VUIVHYKHZ[OLUL^*OPLM,_LJ\[P]L6MÄJLY0JVTTLUK4Y to the higher level. In March 2011, the Authority hosted a Mashile, his team and all the employees of the Authority as National Summit for Persons with Disabilities, which drew the [OL PU[LYYLNU\T ^HZ ^LSS THUHNLK :\MÄJL [V ZH` ^P[O [OL participation of communications and postal service providers committed men and women that I found at ICASA, I have been and the affected stakeholders. able to continue with the work begun by my predecessor in a more excellent way. A roadmap is put in place, and agreed upon by the communications and postal industry licensees and the regulator Notwithstanding the above, the Authority faces daunting to address the plight of Persons with Disabilities. JOHSSLUNLZ PU LUZ\YPUN HU \UX\HSPÄLK H\KP[ VWPUPVU PU M\[\YL To mitigate this risk, the implementation of a revised Corporate On the international front, ICASA played host to the penultimate Strategy, Divisional Business Plans together with improved annual general meetings and the joint general meeting of Quarterly Reporting processes has been introduced. A the Communications Regulators Association of Southern Corporate Secretary has been appointed and the Chief Financial Africa (CRASA) and the Southern African Postal Regulators 6MÄJLY»ZÄ]L`LHYJVU[YHJ[PZUV[YLUL^LK([\YUHYV\UKZ[YH[LN` Association (SAPRA). to address, amongst others, the Auditor General’s management letter is also being put in place. The role of the Authority was to play midwife to merge the two organisations, and the birth of a new regulatory association for the SADC. Three million more of our people who commute, In search of excellence, the Authority has geared itself to play work and live in neighbouring countries need to communicate a change agent role in digitising the Republic of South Africa and send articles across the SADC region. The new CRASA through creating an enabling regulatory environment for all will play a critical role in this regard, in making SADC a region of stakeholders, licensees and operators. In its new outlook, choice for local and international investors. 2011/12 and onwards, the Authority has adopted a new vision, mission and value statement that would distinguish us from *9(:(TLTILYYLN\SH[VYZOH]LL_WYLZZLK[OLPYJVUÄKLUJLPU other regulators across the globe. The Authority has also re- and entrusted ICASA to chair the newly merged organisation in assessed its relevance and adopted eight strategic objectives [OLÄUHUJPHS`LHY that are aligned to Outcome 6 and Outputs 1 and 5 of the National Government Outcome-Based Approach. The new Finally, I would like to thank the Portfolio Committee on approach is intricately linked to the successful implementation Communications initially chaired by Mr Ismail Vadi and currently of the usage of Broadband Services throughout the country. Mr Eric Kholwane; the previous Minister of Communications the Retired General Siphiwe Nyanda and the current Minister Mr Roy Padayachie for your support, understanding and leadership.

0 HT HSZV PUKLI[LK [V 0*(:( *V\UJPSSVYZ VMÄJPHSZ PU [OL Department of Communications, ICASA management and staff, licensees and operators for coming to the “party”, to ensure the Dr Stephen Mncube execution of our mandate. Together we will succeed, we cannot Chairperson falter.

8 9

5. CHIEF EXECUTIVE OFFICER’S REPORT

I am honoured to present the annual report of the Independent ;OPYKS` ÔPSZ[ [OL (\KP[VY .LULYHS OHZ HNHPU X\HSPÄLK [OL Communications Authority of South Africa (ICASA) for the Authority on National Revenue Fund administered assets and ÄUHUJPHS `LHY LUKPUN 4HYJO 4` [OYLL `LHY [LU\YL payables related matters, these shortcomings were already commenced on 1 November 2010. highlighted and acknowledged during presentations to the Parliamentary Portfolio on Communications prior to the end of At the top of the radar screen and planning cycle of the Authority [OLÄUHUJPHS`LHY(WYHJ[PJLUV[L^PSSILPZZ\LK[VZ\WWSLTLU[ at the time, was the development of a 3-year Corporate Strategic existing General Licence Fees Regulations to ensure the Plan for the organisation. This process, concluded after the LMMLJ[P]LHUKLMÄJPLU[JVSSLJ[PVUVMYL]LU\L ÄUHUJPHS`LHYLUKPUJS\KLK[OLKL]LSVWTLU[VMH)\ZPULZZ7SHU derived from the Corporate Strategy, and its alignment with ;OL H\KP[ X\HSPÄJH[PVU VU WYVWLY[` WSHU[ HUK LX\PWTLU[ PZ the Performance Management System (PMS). The Corporate currently being addressed and the Auditor General has been Strategy, derived from the Authority’s mandate in terms of the requested to audit this process during the current year’s interim Constitution and other applicable legislation, includes eight audit. revised strategic objectives which require additional funding to attain them. A turn-around strategy is being drafted to address the shortcomings highlighted as well as to overhaul the entire ;OL(\[OVYP[ÒHZHZPNUPÄJHU[YVSL[VWSH`PU[LYTZVMKL]LSVWPUN ÄUHUJL M\UJ[PVU [V JYLH[L H Z\Z[HPUHISL JVU[YVS LU]PYVUTLU[ appropriate market-friendly regulations, and helping to ensure a Appropriate risk and control policies are being established and stable climate for investment. At the same time, the Authority will be communicated throughout the organisation. T\Z[LUZ\YL[OH[P[ZK\[`[V[OLW\ISPJPZM\SÄSSLKMVYL_HTWSL in terms of ensuring affordable access to information and ;OL(\[OVYP[ÒHKKL]LSVWLK]HYPV\ZÄUHUJPHSTVK\SLZ^P[OPU communication technologies and services for the public. existing systems to address internal control weaknesses. Contract management was automated to improve contract ;OL(\[OVYP[`HSZVPU[LUKZ[VWSH`HZPNUPÄJHU[YVSLPULUZ\YPUN management and commitments. A costing system was that the Government and Department of Communications’ developed to improve controls on budget management and objectives of providing broadband services to 50% of the costs. The automation of customer contracts was completed population by 2019 are achieved. This requires optimal utilisation which will improve customer management and the collection of of scarce resources such as the frequency spectrum. YL]LU\L5PULV\[VM[LUPU[LYMHJLZIL[^LLU[OL1+,ÄUHUJPHS system and Spectrum system were completed with the last The second priority for ICASA is the organisational re-design of PU[LYMHJL ILPUN JVTWSL[LK PU [OL UL^ ÄUHUJPHS `LHY ;OPZ ^PSS the Authority, to enable it to execute its mandate effectively and HKKYLZZ [OL ^LHRULZZLZ PKLU[PÄLK PU ZWLJ[Y\T KLI[VYZ HUK LMÄJPLU[S` ( ZLY]PJL WYV]PKLY ^HZ JVTTPZZPVULK [V JVUK\J[ enable the Authority to manage spectrum debtors on JDE. the organisational re-design exercise, and has submitted both Phase I and Phase II of the report for the Authority’s Although ICASA’s mandate is clearly spelt out in the Law, an consideration, approval and implementation. A status report on important contribution made by the Authority with regards to the outcomes regarding Phase III of the project will be provided the Medium Term Strategic Framework (MTSF) indicators were PUÄUHUJPHS`LHY in the area of black economic empowerment and ensuring effective participation of Historically Disadvantaged Individuals in the communications sector. In addition, with respect to our Transformation Agenda, 50% of statutory obligations. Also, the Authority is looking forward our managers are female. to maintaining a healthy working relationship with the DoC especially with respect to the following: The Authority is, furthermore, assisting our national security state agencies in crime prevention. The Authority took part in Aligning projects, including Frequency Spectrum, or the monitoring of illegal operations, seizure of illegal goods and programmes to minimise duplication of resources and equipment such as computers and mobile phone sets. time; Adopting a structured way of engagement; The Authority also contributes to the MTSF’s objective of “easing Expediting the ICASA Funding model; and the conducting of business in South Africa” by promoting Participating in the Broadband Intergovernmental competition in the communications and postal sectors. Implementation Committee’s Task Team on regulation.

On the operational side of the Authority’s mandate, our regional In conclusion, I would like to pay my gratitude to the ICASA VMÄJLZ OH]L ILLU L_JLW[PVUHSS` I\Z` K\YPUN [OL YLWVY[PUN *V\UJPSSLKI`+Y:[LWOLU4UJ\ILVMÄJPHSZPU[OL+LWHY[TLU[ period providing monitoring and interference clearance support of Communications, colleagues in the Executive Management to the 2010 FIFA World Cup. In this regard, our inspectors were of ICASA and all the employees of the Authority. part of the joint security planning and monitoring committees, and were on call to provide technical support to ensure that communications signals were transmitted without any incident. ;OL-YLL:[H[LYLNPVUHSVMÄJLWSH`ZHWP]V[HSYVSL`LHYPUHUK year-out, to attend to Global System for Mobile spill-overs that occur on the national borders with neighbouring countries of Lesotho, Swaziland and Mozambique in particular.

The road ahead is to ensure that the Authority is well resourced Themba Dlamini ÄUHUJPHSS` HUK [LJOUPJHSS` ZV [OH[ P[ JHU KLSP]LY VU P[Z V^U *OPLM,_LJ\[P]L6MÄJLY

10 11

6. Information on Predetermined Objectives

6.1 Overall Performance In order to ensure effective use of radio frequency spectrum, ensure access to basic services, and economic growth, the Authority committed to amend the licences of the incumbent Competition Matters television broadcaster for purposes of DTT. In this regard, the Authority has granted and issued amended broadcasting The Authority published the Call Termination Regulations services licences to the South African Broadcasting Corporation in terms of Chapter 10 of the ECA, the Interconnection (SABC), e.tv (Pty) Ltd and Trinity Broadcasting Network. Regulations in terms of sections 4 and 38 read with section 4 (3) (j) of the Electronic Communications Act (36/2005) and Monitoring Broadcasting the Electronic Communications Facilities Regulations. The Authority also analysed and approved Telkom’s 2010/2011 tariff The Authority conducts vigilant inspection and undertakes review; analysed SAPO’s 2011/2012 tariff review; analysed and content monitoring of the broadcasting industry. This is to ensure processed 50 ad-hoc tariff applications; and processed 274 that Sound and Television Broadcasting licensees comply with numbering applications. the Electronic Communications Act (ECA), the Broadcasting Act, prescribed regulations, as well as the terms and conditions Licensing of Radio Frequency Spectrum for the Provision of of their licences and compiles Annual Compliance Reports. In Mobile Television this regard, the Authority has approved 20 Annual Compliance Reports. In contributing to ensuring diversity of television broadcasting HUK LUZ\YPUN LMÄJPLU[ \ZL VM YHKPV MYLX\LUJ` ZWLJ[Y\T Monitoring Electronic Communications Network Services/ the Authority has committed to licence radio frequency Electronic Communication Services spectrum for the provision of mobile broadcasting services in [OLÄUHUJPHS`LHY0U[OPZYLNHYK[OL(\[OVYP[`OHZ The Authority is tasked to monitor Electronic Communications granted and issued radio frequency spectrum licences to Network Services/Electronic Communication Services (ECNS/ MultiChoice Africa (Pty) Ltd and e.tv (Pty) Ltd for purposes of ECS) licensees’ compliance with the ECA, relevant regulations, providing mobile broadcasting services in the country. licence terms and conditions as well as compile Annual Compliance Reports. Digital Migration

Draft 2009/2010 Annual Compliance Reports have been The Republic of South Africa is obliged, in the context of the compiled in respect of Neotel, MTN, Cell C, Vodacom, Sentech, global transition from analogue to digital broadcasting, to effect WBS, Internet Solutions and Telkom. the migration of existing terrestrial television services from analogue to digital broadcasting modes. An audit of ECNS/ECS licensees has been conducted to ensure that licensees are complying with the obligation to provide The Digital Migration Policy provides for the establishment services within the prescribed periods from the date of issue of of two (2) national frequency networks designated for the the licence, that is 12 months for ECNS and six months for ECS. provisioning of Digital Terrestrial Television (DTT).

Compliance Procedure Manual Regulations issued 5 032 new radio frequency spectrum licences, 2 351 Type Approval authorisations and 268 broadcasting spectrum 0U VYKLY [V M\SÄS [OL (\[OVYP[`»Z THUKH[L HZ ZL[ V\[ PU [OL applications. The following activities were also carried out: ECA, Broadcasting Act, Postal Services Act and ICASA Act, the Authority is required to effectively monitor and enforce Completed Radio frequency spectrum audits for 161- compliance. Accordingly, the Authority has developed the 173 MHz, 450-470 MHz and 790-862 MHz bands; Compliance Procedure Manual Regulations applicable to Conducted Global System for Mobile (GSM) Quality Broadcasting Services (BS), Electronic Communications of Service drive tests along major routes in JHB, Services (ECS), Electronic Communications Network Services Bloemfontein and Durban; (ECNS) and Postal Services. Engaged with the GSM operators to standardise “drive test” methodology; The Compliance Procedure Manual Regulations will assist Inspected all ICASA monitoring stations nationwide; licensees to understand their obligations and furnish compliance Issued spectrum and type approval authorisations for reports in a prescribed format. The revised Compliance the FWC 2010 project; Procedure Manual was published for comment in December Monitored GSM Quality of Service at FWC 2010 stadia; ;OLÄUHS*VTWSPHUJL7YVJLK\YL4HU\HS^PSSILW\ISPZOLK and K\YPUN[OLÄUHUJPHS`LHY Engaged Tertiary and Research institutes and participated in relevant international and national forums. Postal Services’ Compliance Consumer Affairs The Authority is tasked with monitoring postal services’ (SAPO and Courier companies) compliance with the ICASA Act, No In terms of the mandate of Consumer Affairs, the following was 13 of 2000, as amended, the Postal Services Act, No 124 of achieved during the period under review: 1998, as amended, applicable regulations, licence terms and conditions, and to prepare compliance reports. The SAPO An advocacy strategy was formulated and implemented; 2009/2010 Annual Compliance Report was approved by Regular updating of the web site to assist consumers; Council. Consumer Representative Forums (CRFs) were established to assist in mainstreaming consumer Complaints and Public awareness protection in communities; A National Campaign Strategy was formulated and The Authority distributed Complaints Manuals and monitored implemented; the Quality of Service provided by operators in seven provinces. Public Awareness Campaign in respect of Complaints ;OL(\[OVYP[`JVUK\J[LKÄ]L5H[PVUHS*HTWHPNUZ[VLUOHUJL Handling Procedures through workshops, distribution public education and awareness. A number of complaints of Complaints Handling Procedure pamphlets in 11 were adjudicated by ICASA‘s Complaints and Compliance languages, as well as the distribution of a Complaints Committee (CCC). Manual; and The Authority hosted the National Summit for Persons Spectrum with Disabilities.

The Authority published Radio Frequency Spectrum Fees regulations, Spectrum Licensing Framework Regulations for high demand bands and draft Radio Regulations. The Authority

12 13

6.2 Core Programmes 6.3 Support Services

3PJLUZPUNHUK*VTWSPHUJL is responsible for the granting, The regulatory divisions outlined above are supported by a authorisation, renewal, amendment, transfer and revocation of number of Support Divisions, namely: broadcasting, electronic communication services, electronic communications network services and postal services, 9LNPVUHS6MÄJLZ are responsible for enforcing compliance with including authorising licence exemptions as well as monitoring frequency spectrum allocations and usage, signal interference and ensuring compliance with legislation, regulations and clearance as well as seal and seizure of illegal equipment. licence terms and conditions by licensees and exempted services. 3LNHSHUK[OL*VTWSHPU[ZHUK*VTWSPHUJL*VTTP[[LL is responsible for vetting documents and providing legal advice to 4HYRL[Z HUK *VTWL[P[PVU is responsible for promoting all regulatory projects and to corporate matters. competition in the communications and postal sectors, and [OLLMÄJPLU[WYV]PZPVUVMWVZ[HSLSLJ[YVUPJJVTT\UPJH[PVUZHUK /\THU 9LZV\YJLZ is responsible for the development of broadcasting services at affordable prices. people management practices to enable the Authority to realise its objectives and mandate. ,UNPULLYPUN HUK ;LJOUVSVN` is responsible for the management of the frequency spectrum, and the monitoring of *VTT\UPJH[PVUZ HUK 0U[LYUH[PVUHS 9LSH[PVUZ is the frequency spectrum usage. responsible for the corporate communications and the international relations activities of the Authority. *VUZ\TLY(MMHPYZ is responsible for protecting the rights of consumers with respect to the provision of communications (KTPUPZ[YH[PVU is responsible for maintenance and rental, HUKWVZ[HSZLY]PJLZÄSPUNVMJVUZ\TLYJVTWSHPU[ZHUKYLKYLZZ HZZL[HUKÅLL[THUHNLTLU[JSLHUPUNHUKZLJ\YP[`ZLY]PJLZHZ raising public and consumer awareness about communications well as library services, records and document management. HUKWVZ[HSZLY]PJLZHZ^LSSHZKL]LSVWPUNJVUZ\TLY¶ZWLJPÄJ regulations in relation to communications and postal services. 0UMVYTH[PVU ;LJOUVSVN` is responsible for IT application, hardware and software support to all of the Authority’s divisions HUKYLNPVUHSVMÄJLZ[VLUHISL[OLT[VL_LJ\[L[OLPYKH`[VKH` duties.

-PUHUJLPZYLZWVUZPISLMVY[OLHSSVJH[PVUVMÄUHUJPHSYLZV\YJLZ to meet the budgetary requirements for implementing the organisational business plan. Finance also collects licence fees from all licensees, and these funds are passed on to the National Treasury.

*VTWSPHUJL9PZRHUK(\KP[ is responsible for providing an overall internal assurance function regarding internal control, risk management and governance processes. This is in collaboration with external assurance providers. 7. ICASA Divisions

7.1 CORE FUNCTIONS

7.1.1 LICENSING AND COMPLIANCE 7.1.2 MARKETS AND COMPETITION 7.1.3 ENGINEERING AND TECHNOLOGY 7.1.4 CONSUMER AFFAIRS

7.2 SUPPORT FUNCTIONS

7.2.1 REGIONAL OFFICES 7.2.2 LEGAL AND COMPLAINT AND COMPLIANCE COMMITTEE 7.2.3 HUMAN RESOURCES 7.2.4 COMMUNICATIONS AND INTERNATIONAL RELATIONS 7.2.5 ADMINISTRATION 7.2.6 INFORMATION TECHNOLOGY AND SERVICES

14 15

7.1.1 LICENSING AND COMPLIANCE 3PJLUZPUNVM9HKPV-YLX\LUJ`:WLJ[Y\TMVY7YV]PZPVUVM [OL4VIPSL;LSL]PZPVU The 2006 International Telecommunications Union Treaty The Licensing and Compliance Division (LCD) is made up of on Regional Radio Communication provides for national the Licensing and the Compliance Departments, and provides governments to develop policy on Digital Migration. To this end, human capacity and resources to Council and its Committees the Minister of Communications issued a Digital Migration Policy in relation to – to establish two metropolitan frequency networks designated for The issuing and or authorisation of broadcasting, the provisioning of mobile broadcasting services. electronic communications services, communications network service and postal services licences, as well as As a result, the Authority has granted and issued radio licence exemption; and frequency spectrum licences for the purpose of providing mobile The monitoring and ensuring compliance by licensees broadcasting services to MultiChoice Africa (Pty) Ltd and e.tv and exempted services to the relevant terms and (Pty) Ltd. conditions. The monitoring of licensee compliance with licence conditions and other regulations is not pursued The licensing of these two mobile broadcasting services would for the sake of non-violation with existing legislation and enhance ownership and content diversity in this market, and also regulations, but also seeks to protect investment and YLZ\S[PU[OLLMÄJPLU[\ZLVM[OLYHKPVMYLX\LUJ`ZWLJ[Y\T create certainty in the respective markets.

7.1.1.1 Licensing 3PJLUZPUNVM+PNP[HS;LYYLZ[YPHS;LSL]PZPVU The 2006 International Telecommunications Union Treaty on Regional Radio Communication also provides for national 3PJLUZPUN VM 0UKP]PK\HS *VTTLYJPHS -YLL [V (PY :V\UK governments to develop policy on the transition and migration )YVHKJHZ[PUN:LY]PJL3PJLUJL of existing terrestrial television services from analogue to digital The Authority made a commitment to grant at least three new broadcasting platforms. The Digital Migration Policy issued by commercial licences in primary markets in terms of the Review the Minister of Communications calls for the establishment of of Ownership and Control of Broadcasting Services and Existing two national frequency networks designated for the provisioning Commercial Sound Broadcasting Licences Position Paper of of Digital Terrestrial Television (DTT). 1HU\HY`¸[OL7VZP[PVU7HWLY¹;OL7VZP[PVU7HWLYKLÄULK the primary markets as the geographical markets of Gauteng and In order to achieve this goal, the Authority undertook to assist the metropolitan areas in and around Cape Town and Durban. existing television broadcasting services to facilitate for their transition from an analogue to a digital platform by amending The Authority issued an “Invitation To Apply” (ITA), and had their licences for this purpose. received 41 applications. The Authority has conducted public hearings for the 41 applications received in order to make the As a result, the Authority has granted and issued amended process transparent. broadcasting services licences to the South African Broadcasting Corporation, e.tv (Pty) Ltd and Trinity The licensing of additional commercial sound broadcasting Broadcasting Network. services would contribute to the liberalisation of the sound broadcasting market, diversity of ownership and content as well as to economic growth and job creation. The Authority will ÄUHSPZL[OPZSPJLUZPUNWYVJLZZPU[OLUL_[ÄUHUJPHS`LHY^OLUP[ announces the successful applicants to the bid. 9LNPZ[YH[PVUVM*SHZZ3PJLUJLZHUK

;HISL!9LNPZ[YH[PVUVM*SHZZ3PJLUJLZHUK

3PJLUJL(TLUKTLU[Z;YHUZMLYZHUK,_LTW[PVUZ During the reporting period, the Authority has granted the following licence amendments, transfers and exemptions:

;HISL!3PJLUJL(TLUKTLU[Z;YHUZMLYZHUK,_LTW[PVUZ /LFHQFHV&HUWLðFDWH TOTAL Individual Electronic Communications Service (I-ECS) and Individual Electronic 33 Communications Network Service (I-ECNS) Licence Transfers Private Electronic Communications Network Services 18 Electronic Communications Service Licence Exemptions 7 Class Community Sound Broadcasting Service Licence Amendments 2 ;6;(3

7.1.1.2 Compliance conditions as well as the regulations that apply to all or respective licence categories. *VTWSPHUJL7YVJLK\YL4HU\HS9LN\SH[PVUZ The Authority published draft Compliance Procedure Manual 9L]PL^VM

16 17

The USAO Review project seeks to review the current universal as Licence Terms and Conditions. The three markets that are service and access obligations framework. The review is also being monitored for compliance are broadcasting, electronic PU[LUKLK[VYL]PZL[OLKLÄUP[PVUVM

;HISL!(UU\HS*VTWSPHUJL9LWVY[MVY)YVHKJHZ[PUN:LY]PJLZ Licensee Type of Licence 7\SHRIEURDGFDVWLQJVHUYLFH 1. SAFM Individual Radio 2. Highveld Stereo Individual Radio 3. Algoa FM Individual Radio 4. K-FM Individual Radio 5. Talk 702 Individual Radio 6. Ligwalagwala FM Individual Radio 7. MultiChoice Individual Subscription Television 8. E.tv Individual Free to air Television 9. Jacaranda Individual Radio 10. Lesedi Individual Radio 11. Good Hope Individual Radio 12. Ikwekwezi Individual Radio 13. Lotus Individual Radio 14. Five FM Individual Radio 15. Umhlobo Wenene Individual Radio 16. XKFM Individual Radio 17. YFM Individual Radio 18. Capricorn FM Individual Radio 19. Motsweding FM Individual Radio 20. Tru FM Individual Radio ,SLJ[YVUPJ*VTT\UPJH[PVU5L[^VYR:LY]PJLZ,*5:HUK,SLJ[YVUPJ*VTT\UPJH[PVU:LY]PJLZ,*:3PJLUZLL *VTWSPHUJL -VY[OLÄUHUJPHS`LHY[OL(\[OVYP[`JVTWPSLK[OLMVSSV^PUNHUU\HSJVTWSPHUJLYLVY[ZHZZOV^UPU;HISLILSV^

;HISL!(UU\HS*VTWSPHUJL9LWVY[MVY,*5:HUK,*: Licensee Type of Licence 1. Vodacom (Pty) Ltd Individual ECNS/ECS 2. MTN (Pty) Ltd Individual ECNS/ECS 3. Cell C (Pty) Ltd Individual ECNS/ECS 4. Telkom (Pty) Ltd Individual ECNS/ECS 5. Neotel (Pty) Ltd Individual ECNS/ECS 6. Wireless Business Solutions (Pty) Ltd Individual ECNS/ECS 7. Internet Solutions (Pty) Ltd Individual ECNS/ECS 8. Sentech Individual ECNS/ECS

Furthermore, the Authority completed an audit to establish whether Individual and Class ECNS/ECS licensees commenced operations within six and 12 months respectively of being issued with a licence as required by the licence standard terms and conditions.

7VZ[HS:LY]PJLZ*VTWSPHUJL -VY[OLYLWVY[PUNWLYPVK[OL(\[OVYP[`JVTWPSLKHU(UU\HS*VTWSPHUJL9LWVY[VU[OLWLYMVYTHUJLVM[OL:V\[O(MYPJHU7VZ[6MÄJL (SAPO) with regard to the roll-out of infrastructure, addresses, Delivery Performance Standards, Customer Care Standards and Conveyance of Mail Regulations.

18 19

7.1.2 MARKETS AND COMPETITION The Markets and Competition Division comprises four departments: DIVISION Markets and Competition Analysis; Numbering, Economic and Financial Analysis; The role of the Markets and Competition Division is to promote Broadcasting Policy Development and Research; and JVTWL[P[PVU HUK [OL LMÄJPLU[ WYV]PZPVU VM WVZ[HS LSLJ[YVUPJ Postal Policy Research and Development. communications and broadcasting services, at affordable prices. 7.1.2.1 Markets and Competition Analysis Department

The division’s key performance areas are: The Markets and Competition Analysis department delivered Promoting sustainable, stable, dynamic and innovative the following projects for the reporting period: competition in the electronic communications, broadcasting and postal sectors and to promote high- 9L]PL^VM[OL>OVSLZHSL=VPJL*HSS;LYTPUH[PVU4HYRL[ quality services at affordable prices; The Authority carried over the Market Review of the Wholesale Voice Call Termination Market project from the previous Reducing the cost of doing business in South Africa by ÄUHUJPHS `LHY ;OPZ WYVQLJ[ ZV\NO[ [V YL]PL^ [OL LMMLJ[P]LULZZ encouraging effective competition through increased of competition in the provision of wholesale call termination access to infrastructure, diversity of service, competitive services. prices and a greater choice for consumers;

The Authority conducted extensive public consultation and Ensuring competitive, fair, open, transparent and found that the Wholesale Voice Call Termination Market was non-discriminatory pricing for broadcasting services not competitive. Some of the inhibiting factors included high (codes of practice/guidelines on the commissioning of termination rates (the rate at which one operator charges another independently produced South African programming to receive calls) as well as barriers to increased interconnectivity and sports broadcasting rights); of networks through burdensome requirements in commercially negotiated interconnection agreements. Promoting access to basic services at affordable prices; and As a result, the Authority published regulations that outlined the new termination rates that a licensee may charge for termination Ensuring fair, transparent and non-discriminatory to it’s network. The regulations introduced a gradual reduction HSSVJH[PVUZVMU\TILYZ[VSPJLUZLLZHUKWYV]PKLZ\MÄJPLU[ PU[LYTPUH[PVUYH[LZ[VIV[OTVIPSLHUKÄ_LKSVJH[PVUZV]LYH numbering capacity for existing and future numbering three-year period as illustrated in Table 5: demands. ;HISL!9LN\SH[LK[LYTPUH[PVUYH[LZ! 0RELOHORFDWLRQ )L[HGORFDWLRQ $V\PPHWU\DOORZDQFH :LWKLQ21DUHDFRGH %HWZHHQ21DUHDFRGH 3HDN 2IISHDN 3HDN 2IISHDN 3HDN 2IISHDN 1 March 2011 R0.73 R0.65 R0.20 R0.12 R0.28 R0.19 20% 1 March 2012 R0.56 R0.52 R0.15 R0.12 R0.25 R0.19 15% 1 March 2013 R0.40 R0.40 R0.12 R0.12 R0.19 R0.19 10%

In terms of the Call Termination Regulations, MTN and Vodacom been raised by a number of new entrants aiming to provide are obliged to charge the regulated rate for termination to a mobile such services in South Africa. The Authority will seek further location, whereas Telkom is obliged to charge the regulated LUNHNLTLU[^P[OZ[HRLOVSKLYZPU[OLÄUHUJPHS`LHY YH[LMVY[LYTPUH[PVU[VHÄ_LKSVJH[PVU(SSV[OLYSPJLUZLLZTH` charge a higher rate limited to the above asymmetry allowance. :LJ[VY0U[LSSPNLUJL To ensure that the Authority is adequately informed of trends in 4HYRL[9L]PL^ZSPURLK[V[OLPU[YVK\J[PVUVM3VJHS3VVW the provision of services under its mandate, the division initiated

20 21

7.1. 2. 2 Economic, Financial Analysis and Numbering to publish a revised version of the numbering plan for further W\ISPJJVTTLU[PU[OLUL^ÄUHUJPHS`LHY Economic, Financial Analysis and Numbering delivered the following projects during the reporting period: *HYYPLY7YL:LSLJ[PVU*7: Carrier Pre-Selection (CPS) refers to a service where an end- ,JVUVTPJ 9LN\SH[VY` -YHTL^VYR MVY [OL 9LZLY]LK user is able to choose which service provider to use in the 7VZ[HS:LY]PJLZ provision of a particular service on a call-by-call basis with the In the reporting period the Authority completed the Economic objective of promoting customer choice to take advantage of Regulatory Framework (ERF) for the reserved postal services different pricing options offered by electronic communications by publishing the Price Cap and the Accounting Separation network service licensees. regulations respectively. CPS Phase 1 regulations were published in September 2010, These regulations provide a transparent framework for the and the implementation of the regulations would take place in setting of retail tariffs for the reserved postal services whilst [OLUL^ÄUHUJPHS`LHY ensuring pricing transparency in the provision of services through the new structured separation requirements imposed 0TWSLTLU[H[PVUVM.LVNYHWOPJ5\TILY7VY[HIPSP[`.57 on SAPO. The objective of number portability is to promote consumer choice wherein subscribers are given the freedom to choose The price cap regulations, coupled with the accounting a network operator whilst retaining his/her telephone number. ZLWHYH[PVUMYHTL^VYR^PSSHZZPZ[PUPKLU[PM`PUNPULMÄJPLUJPLZPU [OL7VZ[6MÄJL During the period under review, the Numbering Unit carried out the following activities to ensure full implementation of geographic :(76;HYPMM9LNPTL number portability: ;OL :V\[O (MYPJHU 7VZ[ 6MÄJL PZ YLX\PYLK [V Z\ITP[ HUU\HS Facilitated the implementation process of individual tariff increase applications to the Authority for review in terms geographic number portability by declaring the 26 VMP[ZSPJLUJLJVUKP[PVUZ-VY[OLÄUHUJPHS`LHY:(76 April 2010 as the implementation date for individual requested a 6.5% general increase in prices for reserved postal geographic numbers’ porting. To this end, consumer services. However, to protect the consumer from excessive publicity materials were published and distributed; and tariff increases, the Authority approved a 4.5% general price 7\ISPZOLKHU6YKLYPUN:`Z[LT:WLJPÄJH[PVUZ[VZWLJPM` increase in January 2011. procedures to be followed among operators and service providers when exchanging information between 5\TILY7SHU9L]PL^ each other in order to provide number portability to a The Electronic Communications Act (the ECA) introduced a new subscriber. licensing regime (licence conversion process in January 2009) resulting in over four hundred licensees becoming eligible to During the reporting period, 457 597 geographic numbers were apply for numbers for purposes of providing communication ported to different operators, while 223 4111 mobile numbers services. were ported.

During the reporting period, the Authority developed a new 5\TILYPUN(WWSPJH[PVUZ numbering plan in line with the ECA to address the growing The Authority received 274 applications for numbers from demand for numbering resources. The Authority held public licensees for the provision of communication services during the hearings on the draft numbering plan regulations, and plans ÄUHUJPHS`LHY(WWSPJH[PVUZHYLJSHZZPÄLKHJJVYKPUN to the various categories including geographic and non-geographic numbers, national and international signaling point codes, geographic and mobile number portability routing codes and carrier pre-selection codes.

;HISL!5\TILYPUN(WWSPJH[PVUZ 7\SHRIDSSOLFDWLRQ 1XPEHURI$SSOLFDWLRQV Geographic numbers, e.g. 011, 012, 015, 021 etc. 47 Non Geographic numbers, e.g. 087, 086, 080, 085, 088 etc. 167 Geographic Number Portability (GNP) routing codes 22 Mobile Number Portability (MNP) routing codes 4 National and international signalling points 26 Carrier Pre-select codes 8 ;6;(3

7.1.2.3 Broadcasting Policy Development and The objective of these regulations was to afford fair and Research equitable broadcasting opportunity to all political parties during the Municipal Elections. For the reporting period, Policy Development and Research was involved in the following projects: 9L]PL^ VM 6^ULYZOPW HUK *VU[YVS VM )YVHKJHZ[PUN :LY]PJLZ 3PJLUZPUN-YHTL^VYRMVY07;=HUK=6+ZLY]PJLZ The purpose of the review is to determine whether there are Internet Protocol Television (IPTV) and Video on Demand (VOD) any limitations necessary with regard to ownership and control services have been available in South Africa for a number of of commercial broadcasting services. The Authority intends to years, with demand for such services increasing as more South M\Y[OLYLUNHNLZ[HRLOVSKLYZVU[OPZTH[[LYPU[OLUL^ÄUHUJPHS Africans seek access to the internet. year before making a recommendation to the Minister of Communications. In light of the increased growth and availability of these services, the Authority deemed it necessary to clarify the type of licences ;OL+PNP[HS+P]PKLUK9L]PL^ operators required to provide these services. After extensive With the advent of digital technologies and the abundance of consultation, the Authority decided that any operator providing opportunities that it brings along, the ITU 2007 World Radio IPTV services is required to hold a Broadcasting Service licence Conference resolved and recommended to member countries whilst those interested in providing VOD services are required to prepare for a transition from analogue to digital technology to have an Electronic Communications Service (ECS licence). platform for the future provision of communication services. European and Southern African Development Community The Authority published the Position Paper on IPTV and VOD (SADC) countries are required to migrate to a new digital services in August 2010. platform in June 2015.

4\UPJPWHS,SLJ[PVUZ9LN\SH[PVUZ ;OLILULÄ[ZHUKZWPUVMMZ[OH[HJJY\LMYVT[OPZKPNP[HSTPNYH[PVU The Authority published the Municipal Elections Regulations in process are commonly referred to as the Digital Dividend - which – Political Advertisements and Party Election Broadcasts – in promises the freeing of portions of the frequency spectrum that March 2011, spelling out the allocation of broadcasting slots by is not optimally utilised by the current analogue technology broadcasting services to political parties. platform.

22 23

The portion of spectrum that is expected to be available as a framework that provides for ETOEs within the South African result of migrating to a digital platform will provide much needed market. spectrum for the provision of a plethora of communications services. This includes digital terrestrial television (DTT) with its ;OL (\[OVYP[` OHZ LUNHNLK Z[HRLOVSKLYZ VU [OL ILULÄ[Z HUK multiplicity of broadcasting channels, as well as the availability potential threats that ETOEs may introduce particularly on the of frequency bands that can be used for the deployment of sustainability of SAPO. In order to govern ETOEs, the Authority mobile broadband. will proceed to develop a regulatory framework in the new ÄUHUJPHS`LHY The release of this spectrum is particularly important in order to realise socio-economic goals of universal access and service ,SLJ[YVUPJ7VZ[HS:LY]PJLZ as well as diversity and choice in content. Electronic Post (E-Post) is a service whereby customers that are registered for this service are able to send and receive ;OL(\[OVYP[`OHZÄUHSPZLKP[ZWYVWVZHSZYLNHYKPUN[OL+PNP[HS messages and letters online across the world. It can also be Dividend for South Africa, based on the adoption of an updated viewed as an internet bill payment service where a customer version of Digital Video Broadcast Terrestrial (DVB-T2). Digital can view or pay bills. Video Broadcast Terrestrial (DVB-T) was adopted by Europe, and early in 2011 the SADC region adopted updated DVB-T2. The advent of E-Post became apparent during the World Summit on the Information Society held in 2005. It became evident In terms of the SADC timeframes for digital migration, the new that the postal sector is changing from traditional to modern switch-off date for analogue broadcasting would be December postal services whereby information and communications 2013, with a view to allowing the period between 2013 and 2015 technologies would play a vital role in enabling universal service to be used to address any challenges that may arise towards the and access. The Authority conducted research on the impact International Telecommunications Union (ITU) deadline of 2015. of E-Post on traditional postal services and in particular the KLÄUP[PVUVM\UP]LYZHSZLY]PJLHUKHZZVJPH[LKVISPNH[PVUZ ;OL(\[OVYP[`PU[LUKZ[VÄUHSPZLP[ZYLJVTTLUKH[PVUZYLNHYKPUN [OL+PNP[HS+P]PKLUKPU[OLUL^ÄUHUJPHS`LHY ;OL(\[OVYP[`^PSSÄUHSPZLYLZLHYJOHUKZ[HRLOVSKLYLUNHNLTLU[ on this matter in the new year, as part of a process of building up 7.1.2.4 Postal Policy and Research to a review of the reserved postal service provisions assigned to SAPO. Postal Policy and Research delivered the following projects during the reporting period: 9L[HPSPUMYHZ[Y\J[\YLYVSSV\[[HYNL[ZMVY:(76 SAPO was granted a 25-year licence, with an exclusivity period ,_[YH;LYYP[VYPHS6MÄJLZVM,_JOHUNL VMÄ]L`LHYZ(ZH[YHKLVMMMVY[OPZL_JS\ZP]P[`:(76PZYLX\PYLK ;OL

The current fee charges have been in place for the past 10 years, The Engineering and Technology Division (ETD) comprises and are being reviewed. The current spectrum charging policies of the frequency spectrum and the spectrum monitoring and HUKSPJLUZPUNTLJOHUPZTZKVUV[WYVTV[L[OLLMÄJPLU[\ZLVM control departments. The responsibilities of the division include: the spectrum; rather, they encourage stockpiling of spectrum and are based on out-dated price setting mechanisms. .YHU[PUNVMMYLX\LUJ`HUKZ[H[PVUSPJLUJLZJLY[PÄJH[LZ and authorisations; ;OL (\[OVYP[` JVTTPZZPVULK H ZJPLU[PÄJ Z[\K` [V KL[LYTPUL Management and planning of access to the radio the new radio spectrum fees framework, which takes into frequency spectrum; consideration the economic value of the spectrum. The Preparation of the national radio frequency plan; ÄUHS ZWLJ[Y\T MLLZ YLN\SH[PVUZ HUK [OL KYHM[ ZWLJ[Y\T MLLZ Investigation of radio communications interferences; regulations for broadcasters were published for public comment. Assessment, adoption and management of technical standards relating to customer equipment and other Review of national radio frequency plan devices, and Enabling legislation and international convention require the Provision of relevant technical support to stakeholders. Authority to review the national radio frequency plan from time to time. The Authority has commenced a process of reviewing 7.1.3.1 Frequency Spectrum the National Frequency Plan, to accommodate regional harmonisation in line with the Southern African Development Frequency Spectrum is responsible for four key performance Community’s guidelines and the recommendations of the 2007 areas, namely Spectrum Management, Radio Communications ITU World Radio Communications Conference (WRC – 07). Frequency Licences, Equipment Type Approval and Broadcasting Spectrum. The National Frequency Plan also provides for international mobile telecommunications (IMT) and the digital broadcasting :WLJ[Y\T4HUHNLTLU[ TPNYH[PVUWYVJLZZ;OLÄUHS5H[PVUHS9HKPV-YLX\LUJ`7SHU^HZ Enabling legislation mandates the Authority to allocate and published in June 2010. THUHNL[OLMYLX\LUJ`ZWLJ[Y\TLMÄJPLU[S`PUHJJVYKHUJL^P[O [OL0;<»ZHSSVJH[PVUZ;OLMYLX\LUJ`ZWLJ[Y\TPZHÄUP[LUH[PVUHS Licensing framework for high demand frequencies resource, and the Authority is entrusted with the responsibility This project sought to develop a framework for licensing high [V LUZ\YL P[Z LMÄJPLU[ THUHNLTLU[ [V HZZPZ[ [OL JV\U[Y` [V demand frequencies, namely the 2.6GHz and 3.5GHz band. realise its national socio-economic and developmental goals. There are 125MHz, spectrum available in the 2.6GHz band, following the assignments of 50MHz and 15MHz to Sentech For the year under review, the Spectrum Management was and WBS respectively. involved in the following activities:

There are 28MHz available in the 3.5GHz band, following the Radio spectrum licence fees assignment of 56MHz to Telkom and Neotel, respectively. The ECA mandates the Authority to make regulations with respect to spectrum licence fees. The spectrum fees charged for various radio services are a crucial part of the spectrum

24 25

;OL (\[OVYP[` [OLU PKLU[PÄLK [OL YLTHPUPUN YHKPV MYLX\LUJ` Radio Regulations were published in March 2011 following a spectrum in the 3400–3600MHz (3.5GHz) and 2500-2690MHz public consultation process. (2.6GHz) bands as high demand bands that must be licenced through a competitive licensing process. Collaboration with research institutions The Authority continued to forge relationships and collaborate The required industry consultations were completed and a with academic institutions in relation to wireless technologies and decision to licence the 2.6GHz and 3.5GHz was communicated frequency spectrum management. Contracts were signed with to the industry. Final regulations will be published in the new the University of the Witwatersrand and the University of Pretoria year. after a bidding process. The main focus of the collaboration includes measurements, opportunistic techniques in spectrum Spectrum licensing framework and spectrum assignment management, sharing studies within radio frequency bands and coordination procedures across services, and economic aspects of spectrum. International benchmarking on “best” practices on licensing regimes and a comparative analysis on different spectrum Thus far papers on occupancy models, positioning techniques, assignment coordination procedures were undertaken during and dynamic spectrum access and cooperative sensing for the year under review. A spectrum licensing framework was cognitive radio systems were accepted for several Institute of developed and aligned with the ECA, and incorporated in the Electrical and Electronic Engineers (IEEE) conferences. Radio Regulations. 3PJLUZPUNVM9HKPV*VTT\UPJH[PVUZ-YLX\LUJ` Review of Radio Regulations As at 31 March 2011 there was a total of 46109 radio frequency The review of Radio Regulations was conducted in conjunction licences for various services, predominately due to none with the spectrum licensing framework and spectrum payment of annual fees. A total of 5032 was processed in the assignment coordination procedures. The review sought to year under review. The statistical information is shown in Table align all radio frequency-related regulations to the current 7: legislative dispensation of the ECA and current trends. Final

;HISL!3PJLUJL:[H[PZ[PJZ 1XPEHURIOLFHQFHVDV 1HZ &DQFHOODWLRQV 1XPEHURIOLFHQFHVDVDW DW$SULO Licences 0DUFK Aeronautical 7665 1586 2 050 7 201 Amateur 6864 418 2 032 5 250 Fixed 157 56 43 170 Land Mobile including Ski boats 44 545 1 480 21 431 24 594 Maritime 5531 581 2 214 3 898 Radio Dealer 7907 676 3 851 4 732 Satellite 329 13 78 264 FIFA World Cup related 0 222 222 - ;V[HS ,X\PWTLU[;`WL(WWYV]HS Equipment Type Approval also authorises various classes Radio regulations are continuously reviewed to align them of equipment use and registration of suppliers and installers. with the ECA framework. In the year under review, a review Licnecees do not renew licences for Telecommunication of the current type approval framework was conducted. Draft Line Terminal Equipment (TLTE), switching systems (SWS), YLN\SH[PVUZ^LYLÄUHSPZLKHZ^LSSHZHUVMÄJPHSSPZ[VMHWWYV]LK suppliers and Line Maintenance Organisations where it is no standards regulations for equipment type approval. longer required largely due to equipment being obsolete. Radio Frequency (RF) equipment licences are issued on a permanent basis and therefore need not be renewed. The statistical information is shown in Table 8 below.

;HISL !;`WL(WWYV]HS &DWHJRU\ Number of licences/ 1HZ/LFHQFHV Licences Number of licences/ FHU WLðFDWHVD VDW FHUWLðFDWHV UHQHZHG FHUWLðFDWHVDVDW $SULO 0DUFK Radio Frequency Equipment 8 063 2 069 N/A 10 132 Telecommunications Line Terminating 1 759 171 175 346 Equipment Switching Systems 961 76 271 347 Line Maintenance Organisations 625 15 178 193 Supplier 287 20 3 23 ;V[HS

)YVHKJHZ[PUN:WLJ[Y\T(UHS`ZPZ :L]LYHS TLL[PUNZ ^LYL OLSK ^P[O .:4 Z[HRLOVSKLYZ [V YLÄUL Broadcasting Spectrum received and analysed 268 technical and standardise the GSM drive test methodology. requests for broadcasting frequency spectrum licences. :WLJ[Y\T4VUP[VYPUN 7.1.3.2 Spectrum Monitoring and Control Routine monitoring tasks were conducted in the reporting period. In total, more than four different bands were monitored Spectrum Monitoring and Control entails analysing spectrum for occupancy and illegal usage. TVUP[VYPUN KH[H [V HK]PZL VU ZWLJ[Y\T LMÄJPLUJ` \ZHNL HUK to ensure compliance. This includes long term strategies for :WLJ[Y\T4VUP[VYPUNHUK(\KP[ interference control. Proactive spectrum monitoring and audit was conducted on the bands 161 – 173 MHz, 2300 – 2400 MHz, 2500 – 2690 MHz 8\HSP[`VM:LY]PJL4VUP[VYPUN and 3400 – 3600 MHz, to facilitate implementation of previous The Authority conducted Quality of Service Monitoring on World Radio Conferences and frequency migration. all three Global System for Mobile Communications (GSM) networks in Gauteng and Kwa-Zulu Natal. Quality of Service -0-(>VYSK*\W monitoring was also conducted at all the 2010 FIFA World Cup In June and July 2010, the Spectrum Monitoring and Control stadia. department conducted Radio Frequency (RF) monitoring measurements for the 2010 FIFA World Cup at the various stadia used for the tournament.

26 27

All planned monitoring tasks for the tournament were successfully completed. The successful execution of these tasks was made possible by the procurement of “state of the art” monitoring equipment. 7.1.4 CONSUMER AFFAIRS Kwa-Zulu Natal (Newcastle, Pietermaritzburg, and Durban) Mpumalanga (Nelspruit, Kwa-Mhlanga) Consumer Affairs is responsible for: Free State (Bloemfontein) Protecting the rights of consumers with respect to the Limpopo (Polokwane) provision of communications services; Western Cape (Cape Town, Bellville) Filing consumer complaints for redress and adjudication; Eastern Cape (Port Elizabeth, King Williamstown, and Conducting public education and awareness campaigns Umtata). to inform consumers about the mandate of ICASA, the regulations as well as consumers’ rights with regard to The Authority receives, handles and facilitates the resolution communication services; and of consumer complaints regarding communication services. Developing consumer protection regulations. A total of 1289 complaints were carried over from 2009/2010 7.1.4.1 Consumer Complaints ÄUHUJPHS`LHYHUK^LYLYLJLP]LKPU[OL`LHY\UKLYYL]PL^ This means that 4555 complaints were handled during the reporting period, 3128 of which were resolved. The distribution Consumer Affairs embarked on outreach initiatives by printing of complaints received per province was as follows: and distributing 30 000 copies of the Complaints Manual. In addition 24 workshops regarding the Complaints Manual were Gauteng 58% conducted with interest groups like Legal Wise, Scorpion and Western Cape 14% the Law for All in the following areas: Kwa-Zulu Natal 10% Mpumalanga 4% Gauteng ( Pretoria, Germiston, and Randfontein) Eastern Cape, North West, Free State and Limpopo 5VY[O>LZ[4HÄRLUN 12.5% Northern Province (Kimberly) Northern Cape 1.5%.

;HISL !*H[LNVYPLZVM*VTWSHPU[Z9LJLP]LK QUALITY of SERVICE Description 1XPEHURI&RPSODLQWVUHFHLYHG Unsolicited Merchandise 33 Network coverage 140 Misleading Information 56 General Customer Treatment 106 Faulty Handset 225 Fault Report 161 Asymmetrical Digital Subscriber Line (ADSL) 44 Line Installation & transfer 33 Line Suspension 50 Data Services 55 Community Service Telephones 5 ;V[HS

28 29

CONTRACT TERMS AND CONDITIONS Description 1XPEHURI&RPSODLQWVUHFHLYHG Mobile Number Portability 53 Number Retention 11 Contract Terms and Conditions 595 Call Line Facility 24 Loss of Airtime 25 ;V[HS

BILLING Description 1XPEHURI&RPSODLQWVUHFHLYHG Billing 1100 ;V[HS OTHER Description 1XPEHURI&RPSODLQWVUHFHLYHG Blacklisting 91 Beyond Jurisdiction 362 Broadcasting 10 Postal 23 Licensing 5 Cable Theft 11 Fraud 48 ;V[HS

7.1.4.2 Consumer Protection ;OLÄUKPUNZVM9LZLHYJO:[\K`HYLHZMVSSV^Z!

9LZLHYJO Affordability, is an overridding issue for people The Division commissioned two research studies on: ^P[O KPZHIPSP[PLZ HZ [OL` VM[LU OH]L KPMÄJ\S[` ÄUKPUN employment; 1 Access to electronic communications, broadcasting The high cost of ICT services is prohibitive for most low- and postal services by People with Disabilities, and income people, hence, little use of data services; Radio is the most commonly used ICT service – mostly 2 Consumer’s perceptions and experience with regard because it is free and can be used irrespective of to accessibility, availability and reliability of electronic disability (other than people with hearing impairments); communications, broadcasting and postal services. ;OLYLPZYLSH[P]LS`SP[[SL\ZLVMÄ_LKSPULZLY]PJLZHTVUN the majority of people with disabilities; People with disabilities need access to emergency services, toll free; Internet use is very low particularly among low income 3RVWDOVHUYLFHV60.3% of the respondents indicated that they users – this is largely driven by cost issues; and KPKOH]LHWVZ[VMÄJL^OLYL[OL`SP]L VM\YIHUYLZWVUKLU[Z 7VZ[6MÄJLZHYLUV[\ZLYMYPLUKS`MVYKPZHISLKWLVWSL¶ OH]LHWVZ[VMÄJLPU[OLPYHYLHZ6U[OLV[OLYOHUKSLZZ[OHUOHSM lower counters, special queues and somebody at the [OLZHTWSL VMY\YHSYLZWVUKLU[ZOHZHWVZ[VMÄJLULHY counter able to deal with people with disabilities. them. For affordability of the service, only 6.8% of respondents indicated that the SAPO services are not reasonably priced. ;OLÄUKPUNZVM9LZLHYJO:[\K`HYLHZMVSSV^Z! Similarly, most of the sample could afford the services.

3HUKSPULZ! 79% of the respondents indicated that their phone In addition, Desktop Research was conducted internally during had worked all the time in the last 6 months and was considered the reporting period on the following areas: fairly reliable. The Consumers’ understanding of the Terms and Conditions for prepaid starter packs; 7\ISPJWOVULZ! 80% of the respondents who use public phones Consumer experience on faulty handsets which are said that these phones worked and are reliable. Respondents [LJOUPJHSS`PKLU[PÄLKHZSPX\PKKHTHNLK" also cited ease of access the public phone as another reason as Consumer guidelines for People with Disabilities; to why they used it. Billing complaints; Type Approval of electronic communications and radio 4VIPSLWOVULZ! Most of the sample (82.7%) indicated that they equipment; and did consider prices affordable. The opinion of consumers with Post-paid Contract Terms and Conditions. regard to affordability was very similar in all areas. 4VUP[VYPUN*VTWSPHUJL^P[O*VUZ\TLY7YV[LJ[PVU 0U[LYUL[ZLY]PJLZ! 25.3% of the respondents have an internet 9LN\SH[PVUZ connection at home, despite having access to internet cover- The Authority monitored licensee compliance with consumer age. Most respondents who have an internet connection are protection regulations. Compliance was tested against the based in the urban areas. following regulations:

;LSL]PZPVUIYVHKJHZ[PUNZLY]PJLZ! Most consumers are able Code on People with Disabilities Regulations to get free-to-air television services. Broadcasting services thus The Code requires licensees to provide access to Community appears to be available and accessible for most South Africans. Service Telephones (CSTs) to disabled persons with regard to 86% of the sample do have a working TV. It was found out that people using wheelchairs and those with a hearing disability. 90.5% of consumers have access to a public TV channel of their Out of the three mobile licensees, only one has compliant CST choice. facilities.

9HKPVZLY]PJLZ! 89.2% of the respondents (89.2%) indicated Out of the 404 CSTs monitored, only the Namakgale CST in that they do have a working radio service. Limpopo was found to be compliant with regard to the provision VMWOVULZ^P[OHTWSPÄJH[PVUJHWHIPSP[PLZ A higher percentage of rural respondents (19.5%) do not have a working radio, as compared to other areas. All of the rural Compliance with Customer Care Standards and Complaints respondents who did not use the radio said it was because they Handling Procedures for SAPO could not hear the stations/radio clearly. Many of SAPOs postal outlets were found to be non-compliant with regards to access for Persons with Disabilities in the form of ramps and lowered counters.

30 31

Code of Conduct for Licensees ICASA and licensees should work together with Many communication service licensees were found to be organisations of Persons with Disabilities in relation to compliant with the Code in terms of publishing information meeting their disability equity targets; about applicable tariffs, fees and terms and conditions. ICASA should ensure that community radio stations are accessible to Persons with Disabilities; Monitoring visits were conducted in the following district ICASA should consider drawing the assistance of the municipalities to measure compliance with regulations: Courts and the Ombudsman to effect redress; ICASA should establish a forum to consult with Persons North West: Dr Kenneth Kaunda District Municipality; with Disabilities on regular basis; and Ngaka Modiri Molema District Municipality ICASA together with licensees in partnership with the Limpopo: Vhembe District Municipality; Mopani District organisations for Persons with Disabilities should raise Municipality awareness on disability issues. Mpumalanga: Nkangala District Municipality; Gert Sibande District Municipality; Ehlanzeni 0U[LYUH[PVUHS*VUZ\TLY9PNO[Z+H` Kwa-Zulu Natal: Umlazi Local Municipality; The Authority conducted public awareness campaigns uMgungundlovu District Municipality throughout the country on consumer rights with special Western Cape: West Coast District Municipality; Cape emphasis on communication services. The campaigns were Winelands District Municipality; Overberg District conducted in the following district municipalities: Municipality; Eden Central Karoo District Municipality Free State: Thabo Mofutsanyane District Municipality; Mpumalanga: Pixley ka Seme Local Municipality Lejweleputswa District Municipality North West: Rustenburg Local Municipality Gauteng: City of Johannesburg; Sedibeng Kwa-Zulu Natal: Umzinyathi District Municipality Eastern Cape: Buffalo City District Municipality; Eastern Cape: Buffalo City Municipality at Reeston Chris Hani District Municipality; OR Tambo District settlement Municipality; Amatole District Municipality Western Cape: City of Cape Town at Mfuleni settlement Northern Cape: Siyanda District Municipality. and Witzenberg Local Municipality at Ceres Free State: Setsoto Local Municipality at Senekal 7.1.4.3 Public Education and Awareness Limpopo: Lepelle-Nkumpi Local Municipality at Mafefe village The Authority conducted the following campaigns to raise Gauteng: City of Tshwane in Hammanskraal. public education and awareness with regard to communication services: >VYSK;LSLJVTT\UPJH[PVUZHUK0UMVYTH[PVU:VJPL[`+H` The objective of the campaign was to raise awareness to 5H[PVUHS:\TTP[MVY7LYZVUZ^P[O+PZHIPSP[PLZ [OL NLULYHS W\ISPJ HIV\[ [OL ILULÄ[Z VM PUMVYTH[PVU HUK The Authority hosted the National Summit for People with communication technologies (ICT) and the socio and economic Disabilities on 15 and 16 March 2011 at Birchwood Conference ILULÄ[Z [OH[ HJJY\L MYVT [OL 0*;Z +\YPUN [OL JHTWHPNU Centre in Boksburg. The objective of the Summit was to identify communities were encouraged to take advantage of the ICTs challenges experienced by persons with disabilities, and to and its role in the economy come up with solutions to address those challenges. >VYSK7VZ[+H` The theme of the Summit was Universal Service and Access Communities were informed about the services provided by the to Communications Service for Persons with Disabilities. The WVZ[HSZLJ[VYHUKPUMVYTH[PVUSLHÅL[Z^LYLKPZ[YPI\[LKHZWHY[VM summit resolved that: the World Post Day campaign. 0U[LYUH[PVUHS+H`VM7LVWSL^P[O+PZHIPSP[PLZ North West: Matlosana Local Municipality at Klerksdorp The campaign was dedicated to raise awareness on and Maquassi Hills Local Municipality at Wolmarans. understanding disability issues, the mainstreaming of disability Mpumalanga: Gert Sibande District Municipality, Albert in the national agenda and the promotion of access to Luthuli Local Municipality, Dipaleseng Local Municipality, communication services by Persons with Disabilities. Mkhondo Local Municipality, Msukaligwa Local Municipality, Govan Mbeki Local Municipality, Pixley *VUZ\TLY9LWYLZLU[H[P]L-VY\TZ ka Seme Local Municipality, Lekwa Local Municipality, The Authority has established Consumer Representative Ehlanzeni District Municipality, Nkomazi Local Forums (CRFs) in the country to reach out to communities who Municipality, Mbombela Local Municipality, Umjindi Local are unable to access ICASA due to lack of communications Municipality, Bushbuckridge Local Municipality and infrastructure, distance, and socio economic background. Thaba Chweu Local Municipality. These organised structures also serve as a link between with Limpopo: Mopani District Municipality, Capricorn District communities with regard to complaints referrals to the Authority. Municipality and Waterberg District Municipality. The Authority held meetings with the CRFs in the following areas to take stock of consumer issues amongst the communities: 7YVTV[PVUHS4H[LYPHS The Authority printed and distributed consumer awareness Kwa-Zulu Natal: Umzinyathi District Municipality, Msinga SLHÅL[ZHUKIYVJO\YLZVU! Local Municipality at Dundee, Umgungundlovu District Municipality at Pietermaritzburg and Umgeni Local Contract terms and conditions for mobile services; Municipality, Ugu District Municipality, Park Ryney & Opportunities for youth in the ICT sector; Port Shepston, Ethekwini Metropolitan Municipality and International Consumer Rights Day; Amajuba District Municipality at Newcastle. Regulations on Persons with Disabilities; and Western Cape: City of Cape Town at Mfuleni settlement Geographic Number Portability Free State: Fezile Dabi District Municipality at Sasolburg. Eastern Cape: Amathole District Municipality consisting In addition, the Authority placed advertorials in leading media of Great Kei Local Municipality, Mbashe Local Municipality such as the Eyethu, Consumer Fair, Sowetan, Daily Sun and the and Buffalo City Metropolitan Municipality. SABC radio stations. Northern Cape: Khai – Ma Local Municipality in Upington.

32 33

7.2 SUPPORT FUNCTIONS 7.2.1.1 National Joint Operational Centre

The National Joint Operations Centre (NATJOC) was established 7.2.1 REGIONAL OFFICES as a forum of senior representatives from relevant government entities tasked to manage the successful hosting of planned or 6]LY]PL^ unexpected national events. The successful hosting of national 9LNPVUHSVMÄJLZHYLYLZWVZPISLMVYLSPTPUH[PUNOHYTM\SPU[LYMLYLUJL events requires the coordination and cooperation of various to authorised or licensed users of the radio frequency spectrum, agencies in the health, emergency and safety sectors. The role HUKPUZWLJ[PUNWVZZLZZPVUVMYHKPVHWWHYH[\Z9LNPVUHSVMÄJLZ of ICASA in this regard was to assist state agencies hosting HSZVPUZWLJ[WVZ[VMÄJLZJVUK\J[JVUZ\TLYLK\JH[PVUPUP[PH[P]LZ such events with backup support regarding the use of the radio and provide limited services to the public. frequency spectrum.

-VY[OLWLYPVK\UKLYYL]PL^[OLYLNPVUHSVMÄJLZ^LYLPU]VS]LKPU ICASA has been included in the NATJOC structure as a co- the National Joint Operational Centre, FIFA 2010 World Cup and opted member of this forum to provide such support as required cross-border coordination between South Africa and Lesotho. from time to time.

0U HKKP[PVU 9LNPVUHS 6MÄJLZ ^LYL PU]VS]LK PU PU]LZ[PNH[PVUZ 7.2.1.2 FIFA 2010 World Cup of illegal radio frequency spectrum usage and possession of illegal radio apparatus in all nine provinces of the country and The successful hosting of the FIFA 2010 World Cup was one processed pre-assigned spectrum licences and competency national event that saw the support of ICASA in the management JLY[PÄJH[LZ of the frequency radio spectrum. A total of 3,133 frequencies were monitored for the FIFA 2010 World Cup.

The Table below illustrates the frequencies monitored.

;HISL!-YLX\LUJPLZ4VUP[VYLK 7RWDO %%% )UHTXHQF\EDQGPRQLWRUHG Number of 8QRFFXSLHG 2FFXSLHG Interference frequencies frequencies frequencies HBS frequencies 509 74.1 25.9 0%

UHF frequencies 2166 87.8 11.2 1.0

Metro frequencies 272 94.5 5.5 0.0

Video frequencies 186 74.7 25.3 0.0 ICASA inspectors monitored and inspected communications Global Systems Mobile (GSM) frequencies on the basis of equal equipment used in all the venues and stadia for the FIFA 2010 HUK T\[\HS ILULÄ[ PU HJJVYKHUJL ^P[O YLZWLJ[P]L UH[PVUHS World Cup, to ensure that it was licensed and type approved and legislation and the ITU. that radio frequency spectrum was free of harmful interference. ;OYV\NO YLNPVUHS VMÄJL»Z WHY[PJPWH[PVU PU [OL ;LJOUPJHS :\I The Authority’s role in the FIFA 2010 World Cup is summarised Committee, GSM activities with an estimated value of R8,4 as follows: million were undertaken by committee members to reduce 59 cases of the harmful radio frequency spectrum GSM signal spillage. Memebership of the committee resposible interference reported and resolved with a 100% success for reducing signal spillover includes the following operators: rate; MTN 227 International broadcasters were checked for Vodacom SA compliance; Vodacom Lesotho 3 type approval applications were processed; Cell C 8 licensing applications were processed; Econet Ezicell Lesotho. 8 cases of incorrect frequency utilisation; 14 cases of radio apparatus seized; and In terms of the MoU, the work in progress includes the following: 6 written warnings issued. Implementing signal spillover solutions in areas beyond Maputsoe/Ficksburg bordering North and South regions 7.2.1.3 Cross-border coordination between are still to be discussed and audited; South Africa and Lesotho Spillage signal monitoring on an ongoing basis; Physical auditing of various signal spillover solutions 9LNPVUHS VMÄJLZ WSH`LK H SLHKPUN YVSL PU [OL JYVZZIVYKLY that have been implementated; and coordination forum between South Africa and Lesotho. In GSM signals is not exclusively responsible for signal 2009 a Memorandum of Understanding (MoU) was concluded spillage, other wireless technologies need to be held between ICASA and the Lesotho Telecommunications Authority accountable as well. (LTA) where the parties undertook to resolve the spillover of

34 35

7.2.2 LEGAL AND COMPLAINTS AND June 1998 – Jewish Board of Deputies (SAJBOD) lodged a complaint against IUC broadcasting as Radio 786, COMPLIANCE COMMITTEE several applications followed which ended up ultimately at the Constitutional Court, who held that the BMCC Legal and the Complaints and Compliance Committee (CCC) must adjudicate the matter; provide support to the Authority in relation to the following performance areas: 13 – 17 March 2006 – scheduled hearings by BMCC;

Safeguard ICASA’s interest in litigation matters; 6 March 2006 – urgent application by IUC heard by the Review, draft, vet and advise on ICASA regulations, and Witwatersrand Local Division of the High Court for an documents impacting on ICASA’s regulatory projects; interdict to have the hearings scheduled for 13 – 17 March Provide legal advice and support to Council, Committees postponed (this application was dismissed with costs on and various departments within ICASA; 4HYJO":\IZLX\LU[S`0<*ÄSLKHUHWWSPJH[PVUMVY Provide legal support on regulatory and legislative leave to appeal to the Constitutional Court; drafting projects; Provide general legal support to ICASA; and The BMCC hearing proceeded as scheduled and IUC Coordinate the activities of the Complaints and walked out of the hearing. The BMCC then on 12 May Compliance Committee. 2006 made known their decision that they found IUC guilty of the allegations against them by SAJBOD; 7.2.2.1 Litigation Matters

IUC launched an application against the decision of the The following litigation matters were pending as at March 2011: BMCC in the Cape of Good Hope Division of the High Court on 14 January 2007; and +L\RVT=0*(:(

This matter was set down for trial on 9 and 10 May 2011. Applicant instituted review proceedings against ICASA’s decision to refuse it a subscription broadcasting licence. The Progress to date: Set down for hearing on 9 and 10 May 2011 in matter has been pending due to the fact that Deukom have not Cape Town High Court. ÄSLK [OLPY (MÄKH]P[ KLZWP[L 0*(:( ([[VYUL`Z OH]PUN LUNHNLK them on numerous occasions. 5(-*6*]0*(:(

Progress to date: Set down for week of 4 October 2011, South NAFCOC instituted review proceedings against ICASA following Gauteng High Court. the promulgation of the DTT Regulations. The matter has been WLUKPUN MVY ZVTL [PTL ILJH\ZL 5(-*6* OHZ UV[ ÄSLK [OLPY 0ZSHTPJ

Islamic Unity Convention(IUC) is applying at court for an order Progress to date: The parties are engaging in settlement setting aside a decision by the Broadcasting Monitoring and negotiations regarding the way forward in this matter. Complaints Committee (BMCC) and subsequently ICASA and to interdict ICASA and CCC from investigating and adjudicating ;LSRVT]0*(:( Jewish Board of Deputies (SAJBOD’s) complaint against them.

This is a review application in terms whereof Telkom seeks to review and set aside the publication of the licence fees regulations in Government Gazette 32084 of 1 April 2009. Telkom have not =VKHJVT7;@3;+]0*(:(HUK6[OLYZ ÄSLK [OLPY 9LWS`PUN (MÄKH]P[ KLZWP[L 0*(:( ([[VYUL`Z OH]PUN engaged them on numerous occasions. Vodacom instituted review proceedings to have Regulations promulgated by the Authority, which declared it a major Progress to date: The parties are engaging in settlement operator, set aside. The Authority opposed the application. The negotiations. parties are exploring the possibility of an out of court settlement as well as the legal costs incurred in opposing the matter. -PUHSPZLKHUKJSVZLKSP[PNH[PVUTH[[LYZ Matter was settled.

9HKPV7\SWP[]0*(:( =VKHJVT 7[` 3;+ ] 0*(:( HUK 6[OLYZ /HUKZL[ :\IZPKPLZ9LN\SH[PVUZ ICASA was served with a Review Application by Radio Pulpit for refusing to authorise them to broadcast on the 729 kHz medium Vodacom launched review proceedings against the handset frequency in the Western Cape. subsidies regulations promulgated by ICASA. The parties are exploring out of court settlement as the application has been Progress to date: The matter was heard on the 7-8 March overtaken by events. The regulations were republished for PU[OL:V\[O.H\[LUN/PNO*V\Y[HUKÄUHSPZLK;OLJV\Y[ further comment by interested persons. Vodacom withdrew the decided to review and set aside the decision of the Authority not matter with each party paying its costs. The matter was settled. to grant Radio Pulpit the licence and referred the matter back to the Authority to re-hear the application once the Section 34 )SHJR,HY[O*VTT\UPJH[PVUZ7[`3;+]0*(:(9L]PL^ procedure to re-categorise the Medium Wave Frequencies is (WWSPJH[PVU done. As to costs, ICASA is ordered to pay the costs of the application, save that Radio Pulpit is ordered to pay the costs of Black Earth Communications (BEC) instituted review the application (including Part A of the relief claimed) from the proceedings against ICASA’s decision to refuse to grant it a [PTL^OLU0*(:(»Z(MÄKH]P[^HZKLSP]LYLKHUKZ\JOJVZ[Z[V satellite broadcasting licence on the grounds that BEC failed include the costs of two counsels. to comply with the provisions of section 51(a),(b),(d),(e) of the ECA and with the local content regulation. In its court papers, *H_[VU *;77\ISPZOLYZ 7YPU[LYZ7;@3;+]0*(:( BEC submits that it was not afforded a fair opportunity to HUK6[OLYZ address the issues required under section 51 and the content regulation. The matter was set down for hearing on 17-20 May Caxton instituted review proceedings against the Authority’s 2010 and postponed by the court to the 20-23 September 2010 decision to grant a subscription broadcasting licence to in South Gauteng High court due to its complexity and volume MultiChoice Africa (PTY) Ltd. The Authority opposed the matter VMKVJ\TLU[Z4H[[LYOLHYKHUKÄUHSPZLK and the review application was dismissed in court. Caxton was refused leave to appeal by the Supreme Court of Appeal. Legal >(7(]0*(:( costs to be taxed and the matter was set down for adjudication ILMVYL[OL***HUKÄUHSPZLK The applicants launched an application for a declaratory order, in which they sought an order in the following terms: That holders of a Value Added Network Service (VANs)

36 37

licence issued in terms of Telecommunications Act have 5LV[LS]0*(:( the right to self-provide their own telecommunications facilities; and Neotel has lodged an application to review the Licence Fees That ICASA is obliged to consider the rights of Amobia regulations in terms of which it is liable to pay licence fees and members of WAPA who are holders of VANs’ licences amounting to R100 million. The Authority defended the matter in its interaction with them including the conversion of and it was settled. such licences in terms of the ECA. 3LU4HYZOHSS]0*(:( 0USPNO[VM[OLÄUHSPZH[PVUVM[OL(3;,*/TH[[LY[OLWHY[PLZZL[[SLK the matter out of court and WAPA withdrew its application. Mr Len Marshall instituted legal action against ICASA for the Matter settled. purported recovery of an amount of R95 982, 00 in respect of an alleged over-payment on licence fees. The matter was set down ;,;9(4VIPSL]0*(:( for trial on 5 December 2005 whereat Mr. Marshall requested a postponement of the case and tendered the Authority’s wasted TETRA Mobile instituted urgent court proceedings in which it legal costs. The matter was settled. sought to review and set aside search and seizure warrants in which some of its equipment was seized as it operated without ;YPUP[`)YVHKJHZ[PUN*PZRLP]0*(:( a valid licence issued by the Authority. The Authority opposed [OLTH[[LY;OLTH[[LY^HZZL[[SLKV\[VMJV\Y[HUKÄUHSPZLK Trinity Broadcasting, Ciskei instituted an action to compel ICASA to adjudicate its renewal application for a community television ?3PUR*VUULJ[UL[HUK+H[HSPU_]0*(:( licence. The parties reached an out of court settlement.

The above mentioned entities launched an application for a 9HKPV(SNVH]0*(:( declaratory order application to the effect that they were not required under the Telecommunications Act to be holders of This is a review application against the Authority‘s decision to a value added network service licence and that only in terms extend Algoa FM’s broadcasting footprint to the Southern Cape of the ECA were they required to hold a class electronic and some part of the Western Cape. communication service licence. The parties have reached an out of court settlement and the application was withdrawn. 0*(:(VWWVZLK[OLTH[[LYHUKOHKHSYLHK`ÄSLKP[ZYLJVYK;OL Matter settled. parties agreed to resolve the matter out of court and settlement ^HZYLHJOLK;OLTH[[LY^HZÄUHSPZLKHUKJSVZLK +PYLJ[VY`:VS\[PVU**]0*(:( ;LSRVT+PYLJ[VY`:VS\[PVUZ -YLLKVTVM,_WYLZZPVU0UZ[P[\[L-?0]0*(:( 6[OLYZ Directory Solution launched an application to compel ICASA YLMLYYLK[V***MVYHKQ\KPJH[PVU to investigate a complaint it lodged against Telkom Directory Services. Directory Solution has since approached the Review Application received from FXI, seeking to review the Competition Commission (CC) for relief and adjudication of its CCC’s decision which was granted in favour of the SABC during complaint. According to a newspaper report on 9 April 2010, the CCC hearings. ICASA defended the matter which was heard the Competition Tribunal decided in Directory Solution’s favour. on 24 November 2010 and judgment was handed down on 24 Directory Solution has withdrawn its Review Application against January 2010. The court has referred the matter back to ICASA ICASA and the matter was settled. for CCC to re-adjudicate. Progress to date!***ZOV\SKÄYZ[HWWVPU[HUHJ[PUN*OHPYWLYZVU /LHK6MÄJL(SWOH7V^LYOHZ\W[VKH[LTHKLVUS`WH`TLU[ and thereafter dates can be scheduled to hear the matter. of R10 000.00, and no further payment was made. They have also not signed the AOD (Acknowledgement of Debt) despite 7.2.2.2 Pending Litigation – Non-Regulatory Matters numerous requests from ICASA Attorneys. A meeting was held with a Counsel on 31 March 2011 in order for ICASA to prepare 5V[OUHNLS ] 9(- 0*(:( YK WHY[` JSHPT YLMLYYLK [V to obtain summary judgment against Alpha Power. 0*(:(0UZ\YLYZ 0*(:(],_,TWSV`LL+LI[JVSSLJ[PVU The spouse of a late ICASA employee who died in a motor vehicle accident on duty joined ICASA by way of a third party notice An ex-employee did not return his laptop valued at R10 264-85 in an action for damages for loss of support. The matter has when leaving ICASA’s employment. An Acknowledgement of been referred to ICASA‘s insurers who are opposing the action Debt for payment over 12 months was signed. through their attorneys. The matter was set down for hearing on 11, 12 & 14 October in the High Court in Bloemfontein. 7.2.2.3 Complaints and Compliance Committee Report 0*(:(](SWOH7V^LY7;@3;+)YLHJOVMJVU[YHJ[ The Complaints and Compliance Committee is an independent ICASA has instituted legal proceedings against Alpha Power committee of the Authority that is mandated to investigate and arising out of a contractual dispute following the awarding of adjudicate complaints by stakeholders against licensees. a tender to supply, install and maintain a generator at ICASA’s

;HISL!-PUHSPZLK***TH[[LYZ 3DUWLHVLQ'LVSXWH 1DWXUHRI'LVSXWH Decision 1. ICASA v Super 5 Media The CCC had to decide whether Super 5 Matter heard on 17 June 2010 and Super 5 Media had contravened the limitations on Media ruled not to have contravened s64 of foreign control of commercial broadcasting the ECA (limitations on foreign control of a services. broadcasting entity). 2. Electronic Communications ECN complained that MTN is discriminating The CCC conducted a pre-trial conference Network (ECN) v MTN amongst comparable types of interconnection on 8 June 2010 between ECN and MTN PU[OH[P[[LYTPUH[LZTVIPSL[YHMÄJVUP[ZV^U and subsequently the parties agreed to a network at R0.89 and terminates ECN at settlement and ECN withdrew its complaint. R1.25 even though it is providing the same service to mobile network operators and ECN.

38 39

3DUWLHVLQ'LVSXWH 1DWXUHRI'LVSXWH Decision 3. ICASA v Unitra Community 3PJLUZPUNHUK*VTWSPHUJL+P]PZPVUÄSLK The CCC heard the matter in uMthatha on Radio charges against Unitra Community Radio that 21 June 2010 and ruled that the licensee the licensee does not have a controlling entity must hold an AGM to nominate new Board (Board of Directors) failed to hold an AGM; Members. The station complied with the order No community participation; failed to submit of the CCC and matter was closed. H\KP[LKÄUHUJPHSZ[H[LTLU[Z 4. ICASA v Radio Highway 3PJLUZPUNHUK*VTWSPHUJL+P]PZPVUÄSLKH 9HKPV/PNO^H`Z\ITP[[LK[OLH\KP[LKÄUHUJPHS complaint with the CCC that Radio Highway statements prior to the CCC holding a hearing OHZMHPSLK[VZ\ITP[H\KP[LKÄUHUJPHS and the matter was closed. statements. 5. Caxton v M-net/ Caxton lodged a complaint against On 24 and 25 August 2010 the CCC heard MultiChoice MultiChoice for alleged contravention of arguments between Caxton and MultiChoice various provisions of the ECA relating to and dismissed the complaint and the matter control of a commercial broadcasting entity. was closed. The matter was subject to various litigations. 6. Girish K. Sharma v MTN Mr Sharma lodged a complaint against MTN The CCC heard the matter on 20 May; 02 relating to a cellphone contract dispute. June and 21; 22 and 23 July 2010. The complainant settled the matter with MTN and withdrew the complaint. 7. Thinta Thinta Telecoms Thinta Thinta Telecoms (PTY) Ltd lodged a The CCC deliberated on the matter and (Pty) Ltd v Telkom SA complaint against Telkom relating to alleged concluded that Telkom breached provisions violations of an interconnection agreement 4.6 and 4.13 of Interconnection Agreement between the parties. between the parties. The CCC decided not [VPTWVZLHU`ÄULHNHPUZ[;LSRVTZPUJL[OL breach did not continue after Thinta Thinta alerted Telkom to the breach. The parties accepted CCC’s ruling and the matter was closed. 8. ICASA v Cybersmart ICASA allocated one thousand numbers The licensees responded that the self- to Cybersmart in the 087 625 sub-range in allocation of numbers was made in error. June 2007. The Licensee decided to self- The CCC heard the matter on 8 September allocate itself another nine thousand numbers 2010 and ordered Cybersmart not to lodge between 2007 to date without approval from any application for new numbers before April ICASA. 2011. Further, it was given a suspended sanction that in the event that it is found guilty of the same offence within 5 years from the date of the order of the CCC, its licence was to be suspended for a period of 30 days. 3DUWLHVLQ'LVSXWH 1DWXUHRI'LVSXWH Decision 9. Telkom v Cell C 6U(\N\Z[;LSRVTÄSLKHKPZW\[L The CCC heard the matter on 20 October against Cell C for failure to conclude an 2010 and ruled that the call termination rates, Interconnection agreement. which shall be included in the agreement, are those contained in the interim agreement concluded on 2 September 2010 between the parties, save to the extent that that rate has been changed by the Call Termination Regulations which were published on 29 October 2010. 10. Telkom v Vodacom 6U(\N\Z[;LSRVTÄSLKHKPZW\[L The matter was heard on 22 October 2010 against Vodacom for failure to conclude an and 18 and 20 November 2010 and the CCC Interconnection agreement. that Telkom and Vodacom be ordered to charge a wholesale termination rate of 89c (peak) and 76c (off-peak) per minute and TM 6c per minute for CST calls which terminate on its system from Vodacom. The Committee further ruled that Clauses 1 and 2 of the interconnection agreement cease to operate on 29 October 2010 when the Termination Rate Regulations of 2010 became operational; such Regulations governing the matter as from that date. 11. Telkom v MTN 6U(\N\Z[;LSRVTÄSLKHKPZW\[L The CCC heard the matter on 30 September against MTN for failure to conclude an and 2 October 2010 and ruled that Telkom Interconnection agreement. and MTN negotiate to reach agreement on a clause on the quality of interconnection bypass and a clause agreeable to both parties may be included in the agreement. If the negotiations do not produce a clause acceptable to both parties within seven days of the communication of the ruling to the parties, the need for such a clause will fall away and the draft agreement referred to will be binding on both parties.

40 41

;HISL!7LUKPUN***TH[[LYZ 3DUWLHVLQ'LVSXWH 1DWXUHRI'LVSXWH Action 1. Phuthuma Networks v 7O\[O\TH5L[^VYRZ7[`3[KÄSLKHJVTWSHPU[ The matter will be heard on 28 and 29 Telkom and alleged that Network Telex is not in March 2011 possession of either an ECS or an ECNS licence to provide the Maritime services, telegram services, supply of Customer Premises Equipment on behalf of Telkom SA. 2. Platitel v Dira Ka Thata On 25 August 2010 Platitel (Pty) Limited lodged The matter was heard by CCC on 7 a complaint to the effect that Dira Ka Thata December 2010. The CCC ordered *VTW\[LYZ7[`3PTP[LK+2;»Z[YHMÄJ[LYTPUH[LK that ICASA appoints inspectors to carry VU+2;MYVT7SH[P[LS^HZHY[PÄJPHSS`NLULYH[LK out an investigation whether indeed [YHMÄJ [OL[YHMÄJMYVT+2;^HZHY[PÄJPHSS` NLULYH[LK7VZ[WVULKPUKLÄUP[LS` 3. Mogafe v Vodacom The matter was brought before the CCC for The matter was heard on 6 December failure on the part of the licensee to submit 2010 and was further heard on 10-16 H\KP[LKÄUHUJPHSZ[H[LTLU[ZHZYLX\LZ[LKI` March 2011. ICASA. Postponed to 6–10 June 2011 4. ICASA v YODATA (PTY) LTD Unlabelled electronic communications equipment The matter will be heard on 15-16 April was provided by Yodata Electronics (Pty) Ltd to 2011. Massmart from where it was seized by ICASA inspectors in December 2008. 5. FXI v SABC On 24 January 2011 the South Gauteng Awaiting allocation of a date High Court ruled that the CCC reconsider the complaint lodged by FXI against the SABC for allegedly blacklisting of certain journalists. 6. ICASA v Vertel Investments Various allegations against Vertel Investments for Awaiting allocation of a date (Pty) Ltd contravening sections 31;32;35 of the ECA. 7. ICASA v Brians Electrical Various allegations against Brians Electrical for Awaiting allocation of a date Contractors contravening sections 31;32;35 of the ECA 8. ICASA v Radio Trunk Various allegations against Radio Trunk for Awaiting allocation of a date contravening sections 31;32;35 of the ECA 9. ICASA v ADT Various allegations against ADT for contravening Awaiting allocation of a date sections 31;32;35 of the ECA 10. ICASA v Imbokodo The ICASA Council sanctioned Imbokodo in Awaiting allocation of a date Community Radio January 2010 to pay R42 000 by July 2010. The licensee has failed to comply with the sanction and new charges have been levelled for failure to WH`[OLÄUL 3DUWLHVLQ'LVSXWH 1DWXUHRI'LVSXWH Action 11. ICASA v Electro Instruments Various allegations against Electro Instruments Awaiting allocation of a date Mining Mining (PTY) Ltd for contravening Section 7 of the ECA and other applicable regulations. 12. ICASA v Nkqubela The ICASA Council sanctioned Nkqubela Awaiting allocation of a date Community Radio Community Radio in January 2010 to pay R12 I`1\S`*VTWSPHUJL

42 43

7.2.3 HUMAN RESOURCES implementation of the recommendations; and A review of the recommended organisational structure has commenced. Human Resources is responsible for the development of people management practices to enable the Authority to realise The recommended organisational re-alignment will enhance the its objectives and mandate. To achieve this, HR facilitates overall performance of the organisation. This includes improved processes that serve as a solid foundation for competency- effectiveness of regulatory processes, reduction of wastage based practices and talent management philosophy. of resources, elimination of duplication of work and increase SL]LSZVMYLZWVUZP]LULZZ[V[OLILULÄJPHYPLZHUKHJJV\U[HIPSP[` The key HR performance areas are as follows: to stakeholders.

Organisational re-engineering and alignment of organisational structure to organisational objectives and 7.2.3.2 Talent Attraction and Retention Strategy mandate; In order to attract and retain expertise, the organisation has Talent attraction, acquisition and retention; PU[LUZPÄLK[HSLU[JHWP[HSTHUHNLTLU[WYVJLZZLZPUHSSHYLHZVM Performance management and career advancement practice. The key objective is to position the organisation as a strategies; preferred employer in terms of people management practices Development of appropriate human resources policies, and levels of professionalism. practices and procedures; and Development of employee wellness within a conducive ;HSLU[(JX\PZP[PVU4HUHNLTLU[ working environment. ;OLYL^LYL]HJHUJPLZH[[OLILNPUUPUNVM[OLÄUHUJPHS 7.2.3.1 Organisational Structural Review and `LHYHUK VM[OVZL^LYLÄSSLK" Alignment Human Resources practitioner’ training competency based interviewing techniques has been completed and The Organisational Structural Review and Alignment project was application has become widespread; launched in October 2009 to review the current establishment HUK ^VYR TL[OVKZ HUK [OLPY Z\P[HIPSP[` MVY LMÄJPLUJ` HUK Psychometric and technical skill assessments methods effectiveness in meeting the Authority’s objective and mandate. have been introduced at executive and operational levels YLZWLJ[P]LS`[VJVUÄYTJHUKPKH[LZ\P[HIPSP[`"HUK The organisational review exercise was also informed by international bench-marking with similar organisations The automation of recruitment and selection responsible for the regulation of communications and postal management system is still under development but the services. The recommendations of the review have been tabled YLZWVUZL OHUKSPUN WYVJLZZ PZ TVYL LMÄJPLU[ LHZ` [V before Council and Executive Management. track, transparent and credible.

([[OLLUKVM[OLÄUHUJPHS`LHY[OLMVSSV^PUNTPSLZ[VULZOH]L ;HSLU[+L]LSVWTLU[ been achieved: An integrated human resources development strategy was developed to introduce on the job training methodologies to A revised organisational structure and integrated work augment formal training. The strategy comprises interventions processes have been proposed to ICASA; varying from coaching to international exchange programmes A Steering Committee has been activated to guide the and secondments. The following deliverables were achieved: 354 participants attended 132 learning programmes. Remuneration Committee in October 2010. Agreement The number includes the enrolment of Executive with organised labour was reached in November 2010 Management in the Executive Development Programme to implement proposed salary scale at the management offered by the Gordon Institute for Business Sciences; SL]LSÄYZ[HUKSH[LYH[[OLIHYNHPUPUNSL]LSPU[OLUL_[ and ÄUHUJPHS`LHY"HUK

Human Resources’ Techno-Girl job-shadowing The recommendation to reduce the number of medical WYVNYHTTL WSHJLK Ä]L OPNO ZJOVVS NPYSZ PU ]HYPV\Z HPK ZJOLTLZ MYVT Ä]L [V [^V ^HZ HWWYV]LK MVSSV^PUN organisational divisions to expose them to career an internal consultation process. Three medical aid opportunities in the communications and postal sector. schemes had been ring-fenced to allow for a gradual phasing out process once its members terminate 7.2.3.3 Integrated Performance Management membership through resignations or natural attrition. System 7.2.3.5 Employee Relations A revised integrated Performance Management System policy was introduced as a corner stone for talent development, With respect to employee relations HR implemented the career advancement, succession planning, performance- MVSSV^PUNPU[OLÄUHUJPHS`LHY! based remuneration and incentives, effective management and the inculcation of an organisational culture. Annual Substantive Negotiations: The 2010/11 annual substantive negotiations were settled at eight percent Eighty-two percent of the employee headcount have entered salary increase across the board in November 2010; PU[VWLYMVYTHUJLHNYLLTLU[ZMVY[OLÄUHUJPHS`LHYHUK had gone through half yearly reviews. The utilisation rate of the Employee Assistance Programme has increased from 48% to 52%. There is 7.2.3.4 Transformation of Remuneration Practices a marked increase in the number of management staff who are accessing the service; Human Resources achieved the following deliverables with regard to the transformation of Remuneration Practices: The organisation’s three year employment Equity Plan The automation of payroll, leave, and tax return/rebate was submitted to, and approved by the Department of forms (IRP5), pay-slips, per diem and overtime claims. Labour; and This resulted in reduced audit queries and improved accuracy of management information and reports; The organisation has experienced a decline in the turnover rate over the past three years from 11% down The design of salary scales and the conversion to total to eight percent, and to six percent at the end of the Cost to Employer remuneration system was concluded reporting period. and work-shopped with all leadership levels and the

44 45

;OLKLTVNYHWOPJZVM[OL(\[OVYP[`HYLYLÅLJ[LKPU[OL[HISLZILSV^!

;HISL!+LTVNYHWOPJZ7LY3L]LS 0DUFK *HQGHU 5DFH )HPDOH 0DOH $IULFDQ &RORXUHG ,QGLDQ White 7RWDO Council (F) 3 6 7 - - 2 9 Executive Management (E) 3 8 9 1 - 1 11 Senior Managers (D4) 8 10 14 2 2 - 18 Managers (D1) 11 25 30 2 1 3 36 Staff 158 139 219 19 12 47 297 ;V[HS,TWSV`LLZ % Per Gender & Race 49.33% 50.67% 75.20% 6.47% 4.04% 14.29%

;HISL!+LTVNYHWOPJZ7LY+P]PZPVU 0DUFK *HQGHU 5DFH )HPDOH 0DOH $IULFDQ &RORXUHG ,QGLDQ White 7RWDO Administration 18 12 28 2 -- 30 Consumer Affairs 11 5 16 - - - 16 Council & Support 16 6 16 3 1 2 22 *,6»Z6MÄJL 313 -1- 4 Communications & International Relations 4 4 8 - - 0 8 Compliance, Risk & Audit 10 4 11 3 - - 14 Engineering & Technology 19 41 37 1 4 18 60 Finance 25 16 34 1 1 5 41 Human Resources 73711110 Information Technology 4 9 5 1 3 4 13 Legal & CCC 6 4 9 - - 1 10 Licensing & Compliance 18 19 34 2 - 1 37 Markets & Competition 19 11 28 - - 2 30 Regions 23 53 43 10 4 19 76 ;V[HS,TWSV`LLZ % Per Gender 49.33% 50.67% % Per Race 75.2% 6.47% 4.04% 14.29% 7. 2.4 COMMUNICATIONS AND 0U[LYUHS*VTT\UPJH[PVUZHUK,]LU[Z Internal Communications entails the distribution of organisational INTERNATIONAL RELATIONS information to internal stakeholders. Some of the media used for this purpose include: Communications and International Relations is responsible for Daily electronic newsletter; corporate communications and international relations activities Print Quarterly Newsletter; of the Authority. Intranet site; Internal stakeholders’ meetings at head and regional 7.2.4.1 Communications VMÄJLZ"HUK Internal events such as the Year-End function, Walk the The corporate communications activities of the Authority consist Talk, and Wellness Day. of external and internal communications aspects. During the reporting period, Corporate Communications was involved in 7.2.4.2 International Relations the following activities:

International Relations coordinates the sub-continental, 4LKPH3PHPZVU continental and international relations of the Authority at both Media Liaison activities entailed the following: bilateral and multi-lateral levels. Media statements and enquiries; Interviews with project leaders; and International Relations ensures the Authority’s representation (YYHUNLK7YLZZ)YPLÄUNZ*VUMLYLUJLZ at relevant international meetings for purposes of regulatory harmonisation. :[HRLOVSKLY3PHPZVU Stakeholder Liaison activities entailed the following: The key organisations in which the Authority was represented Responding to enquiries; include: Publishing regulatory and corporate documents on International Telecommunications Union; website; Universal Postal Union; Updating stakeholder database; and Commonwealth Telecommunications Union; Hosting stakeholder meetings. Pan African Postal Union; Communications Regulatory Association of Southern 4HYRL[PUNHUK)YHUKPUN Africa; and Corporate Communications took part in industry exhibitions Southern African Postal Regulatory Association. and road-shows that sought to position and raise the public WYVÄSLVM[OL(\[OVYP[`HZ^LSSHZW\ISPJPZLP[ZTHUKH[L[V[OL The Authority hosted the annual general meetings and a joint general public. general meeting of the Communications Regulatory Association of Southern Africa (CRASA) and the Southern African Postal Key marketing and branding activities included the following: Regulatory Association. Industry expos and exhibitions; 2010 FIFA World Cup; The merger of the two organisations created a single regulatory Issuance and placement of media notices in leading association for communication and postal services for the daily and weekly publications; and SADC Region. ICASA was nominated to chair the executive Production and distribution of corporate video. committee of the new association, CRASA.

46 47

ICASA has been at the forefront of communications and postal The Authority hosted a number of delegations from across the regulation in the SADC Region. Some of the milestones include: continent on study visits to benchmark regulatory developments. Harmonisation of radio frequent bands, the SADC ICASA also sent a team to Tanzania to benchmark regulation in Frequency Band Plan; and the postal sector. Chairing the SADC Home and Away Roaming Committee to facilitate the development of common and affordable Communications and International Relations has commissioned mobile telephony roaming tariffs for the SADC. the development of a corporate communications and international relations strategy for the Authority. 7.2.5 ADMINISTRATION 7.2.5.3 Records and Document Management

Administration provides strategic support to all divisions in The Authority strives to ensure effective documents and records order to meet the Authority’s legislative mandate and the management by enforcing compliance with the National requirements of corporate governance. Activities of the division Archives and Records Services of South Africa. Workshops are guided by prescribed provisions of various legislations or were held with all divisions on the review and amendment of the delegation of authority that may reside elsewhere within the ÄSLWSHU;OLZL^VYRZOVWZWYV]PKLKHUVWWVY[\UP[`[VM\Y[OLY Authority’s policies. The following are some of the highlights understand the business processes’ needs of the organisation. during the period under review: These workshops sought to ensure that all ICASA business WYVJLZZLZHYLPUJS\KLKPU[OLHWWYV]LKÄSLWSHU 7.2.5.1 Facilities and Property Management A central registry for receipt/distribution of incoming/outgoing In an effort to ensure that the Authority’s accommodation mail and other hand delivered items has been developed to suits the safety, health, environmental friendliness, quality and ensure an improved system of document tracking and retrieval. risk requirements (SHAQR) the authority relocated the Cape ;V^U+\YIHUHUK7VY[,SPaHIL[O9LNPVUHSVMÄJLZ;OLTHQVY In order to improve and learn from peers on best practice on ILULÄJPHYPLZHYLJVUZ\TLYZHUKZ[HRLOVSKLYZPU[LYTZVMLHZ` information management, the unit undertook a benchmark visit accessibility to the Authority and the services it provides. to the Library of Parliament and the Rand Water library.

7.2.5.2 The Library and Information Centre 7.2.5.4 Fleet Management

The ICASA library continues to provide information services The division continued to ensure provision and management related to the communications sector to a diverse clientele, VM YLSPHISL ÅLL[ [V M\SÄS [OL THUKH[L VM [OL (\[OVYP[` ( ^PKLY including the Authority’s staff, research students, external spectrum of monitoring tasks can only be executed with vehicles stakeholders, and the general public. Also of importance is Ä[[LK ^P[O ZWLJPHS LX\PWTLU[ HUK VWLYH[VY JVTWL[LUJPLZ subscription to various databases and publications that assist that are unique to the Authority. Administration ensured that the Authority in accessing relevant regulatory information about necessary controls are in place to comply with legislation. the communications and postal sectors.

48 49

7.2.6 INFORMATION TECHNOLOGY A project commenced to re-develop the Central Numbering Database Application for the Markets and AND SERVICES Competitions Division. This system will have an external user interface so that the information will be available Information Technology and Services provides applications, to end users on-line via the internet. Licensees will also hardware and software support to all of the Authority’s divisions have the ability to apply for numbers via the ICASA HUK YLNPVUHS VMÄJLZ [V LUHISL [OLT [V L_LJ\[L [OLPY KH`[V website. Internally each application for numbers will day duties. During the reporting period the following has been IL JVU[YVSSLK ]PH ^VYRÅV^ VU [OL PU[LYUHS 4PJYVZVM[ achieved; SharePoint system; The Authority has developed a three year Information Technology Master Systems Plan (MSP). This plan For the Engineering and Technology Division, the incorporates the requirements from all divisions within microwave assignments data has been migrated to the ICASA and provides the framework of IT initiatives over LS System. This system will allow for improved reporting the next three years. This plan will be reviewed and and the ability to overlay microwave station locations on updated annually; terrain maps; and

A Business Continuity Plan (BCP) and a Disaster For Finance, an activity based project costing system Recovery Plan (DRP) have been developed. All divisions was developed to improve controls on budget were included and business impact analyses were THUHNLTLU[HUKJVZ[Z6U[OLÄUHUJPHSZ`Z[LT1+, completed. These were consolidated and incorporated JVU[YHJ[THUHNLTLU[^HZJVUÄN\YLK;OLTHQVYP[`VM PU[V[OL)*7HUK[OL+97;OLÄYZ[VMMZP[LYLJV]LYPLZVM the interfaces between JDE and the Spectrum System selected IT systems were also done; have been completed. This will improve customer management and collection of revenue as both of these will now be done via the same system. INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA 8. PERFORMANCE TABLES for the year ended 31 March 2011

50 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY Amended Broadcasting Service licences were issued to South African Broadcasting Corporation Broadcasting (SABC), e.tv (Pty) Ltd and Trinity Broadcasting Service licence Network. MNet’s ^HZHSPNULKPUWYL]PV\ZÄUHUJPHS`LHYZ A total of two hundred and thirty one (231) comprising of Class Electronic Communications Services, Class Electronic Communications Net- work Services; Class Community Broadcasting Services and Courier services were registered. One (1) Class Community Broadcasting Service was refused. Eighteen (18) Private Electronic Communications Network Services and seven (7) Electronic Communications Service licence exemptions were authorised. A total of thirty three (33) comprising Individual Electronic Communications Network Service and Individual Electronic Communications Service (2) class com- licences were transferred. Two munity sound broadcasting service licences were amended. gazetted for comments. All applications were analysed. Hearings for forty one (41) applications were conducted. Deliberations Decisions and issuance of the licences was not done due to the large number of applications received. Whilst Public hearing deliberations have been conducted for the forty one (41) applications, no licences have yet been granted. Target 4 Migrated/ amended television licensees from analogue to digital 25 Licences and *LY[PÄJH[LZ 10 Amended and Licences Transferred 3 Licences Forty one (41) applications received were Unit of Measurement Number of Licences Number of Licences and *LY[PÄJH[LZ Number of Amended and Transferred Licences Number of Licences (Output) Key Performance Indicator Migrating all current television licensees from analogue to digital Registration of all received class ECS and ECNS community sound broadcasting services and Courier companies applications. Amendments and Transfers of Amendments and Transfers existing ECNS, ECS and BS licences Grant and issue commercial sound broadcasting services to successful applicants in KZN, WC and Gauteng - one per province Area Licensing of Digital Ter- - DTT restrial Television Registrations of class licences and courier companies Amendments and of Electronic Transfers Communication Net- work Service (ECNS), Electronic Communi- cation Service (ECS) and Broadcasting Services (BS) licences Licensing of additional commercial radio services Strategic Goals Key Performance Access to Basic Services, Economic Growth and Black Economic Empowerment and Economic Growth and services cess to Basic Services (BS), Economic Growth and Black Economic Empowerment KPI No. 1.4 Liberalisation of Sector, 1.3 Access to Basic Services LICENSING AND COMPLIANCE 1.2 ensure universal access To 1.1 Ac- Liberalisation of Sector, LICENSING of competition in the ICT Sector Liberalisation and promotion

6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY Workshops were held with broadcasting licens- Workshops LLZVU[OLJV]LYHNLVMLSLJ[PVUZ;^LU[`Ä]L ;LTWVYHY`4VUP[VYPUN6MÄJLYZ^LYLHWWVPU[LK[V monitor the coverage of party election broadcasts and political advertisements by broadcasters. -VY[OLÄUHUJPHS`LHY[OLMVSSV^PUN twenty (20) Annual Compliance Reports were approved by Council: Lesedi FM, UMhlobo We- Jacaranda FM, KFM, Highveld Radio, Nene, e.tv, Radio 702, Algoa FM, Ligwalagwala Talk XKFM, SAFM, MultiChoice, 5FM, Good Hope FM, Ikwekwezi Capricorn Ukhozi YFM, Motsweding and Lotus FM. An Annual Compliance Report on the South (MYPJHU7VZ[6MÄJL»ZWLYMVYTHUJL^P[OYLNHYKZ[V the Infrastructure rollout, Address Delivery Performance Standards, Customer Care Stan- dards and the Conveyance of Mail Regulations was compiled. The Audit conducted in respect of the courier companies, verifying whether all the couriers listed on the Licensing and Compliance database are still operational, is underway. Radio Frequency Spectrum Licences for provision of Mobile Broadcasting Services were granted and issued to e.tv (Pty) Ltd MultiChoice Africa (Pty) Ltd. Target Preparations for the monitoring of Local Municipal Elections 20 Annual compliance reports for Individual Broadcasting Services 1 Annual Compliance Report 2 issued Licences for Mobile Broadcasting Services Unit of Measurement Compliance Report to be produced in 2011/2012 ÄUHUJPHS`LHY Compliance Reports A compliance report Number of Licences (Output) Key Performance Indicator Finalise preparations for the monitoring of coverage party election broadcasts and political advertisements by broadcasters during the Elections period i.e. workshops held with broadcasters and appointment of temporary monitoring staff. Produce Annual compliance reports for Individual Broadcast- ing Services Produce Annual compliance reports for SAPO and Courier companies Grant and issue Licences for Mobile Broadcasting Services Area age of party election broadcasts and political advertisements by broadcasters during the Election period, ahead of the 18 May 2011 Municipal Elec- tions. casting Services services Licensing of Mobile Broadcasting Services Strategic Goals Key Performance Access to Basic Services, Economic Growth and Black Economic Empowerment KPI No. 1.3 Monitoring of cover- 1.2 Monitoring of Broad- COMPLIANCE and the law compliance with regulations adjudicate and enforce Monitor, 1.1 Strengthen Regulation Monitoring of postal 1.5 Liberalisation of Sector,

52 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY The revised Compliance Procedure Manual Regulations was published for comment in December 2010. The closing date for comments was set for 31 January 2011. Submissions were YLJLP]LKMYVTMV\Y[LLUZ[HRLOVSKLYZ;OLÄUHS regulations will be published in 2011/12. The Position Paper was published for comment on 19 August 2010. The closing date for comments was set for 12 November 2010.Submis- sions were received from 17 stakeholders. Public Hearings were held on 8 and 9 December 2010. The draft Findings Document is being reviewed. The USAO Review project was extended to PUJS\KL[OL+LÄUP[PVUVM

53 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY and control matters for commercial broadcasting services and whether any limitations were neces- ZHY`;OPZ^VYROHZUV[`L[ILLUÄUHSPZLKHUK^PSS JVU[PU\LPU[V[OLÄUHUJPHS`LHY relevant regulatory frameworks for Internet (IPTV) and Video on Demand Protocol Television (VOD) services. The Authority determined that IPTV services are deemed to be broadcasting services. Therefore any party providing IPTV services is required to hold a Broadcasting Service licence. The Authority also determined that a licensee providing VOD services is required to have an Electronic Communications Service (ECS licence). These determinations provide ongoing regulatory certainty to licensees who wish to provide such services. The Position Paper in relation to IPTV and VOD services was released on 3 August 2010 (GG 33436). Target Framework Document The Authority conducted an analysis of the Unit of Measurement Report Report The Authority reviewed its position on ownership Framework Document (Output) Key Performance Indicator Policy recommendations to the Minister of Communications on Ownership and Control of commercial broadcasting services and limitations on broadcasting services levels for the amendment of the Electronic Commu- nication Act Regulatory framework for Video On Demand (VOD) and Internet (IPTV) Protocol Television Area Review the current regulations on Owner- ship and Control of commercial broadcasting services and limitations on broadcasting services (Phase 2) Examine the options to facilitate the introduction of a regulatory approach towards Video On Demand (VOD) and Internet Protocol (IPTV) (Phase Television 2) Strategic Goals Key Performance stable, dynamic and innovative competition, choice and diversity in the electronic communications and broadcasting and postal sectors to deliver high quality services at competitive prices. stable, dynamic and innovative competition in the electronic communication and broadcasting sector to deliver high quality services at competitive prices KPI No. Monitor, adjudicate and enforce compliance with regulations and the law compliance with regulations adjudicate and enforce Monitor, 2.1 promote sustainable, To 1.1 promote sustainable, To MARKETS AND COMPETITION BROADCASTING POLICY DEVELOPMENT AND RESEARCH of competition in the ICT Sector Liberalisation and promotion

54 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY During the 2010/11 Authority informed Minister of Communications the Authority’s intentions to commence public consultations on the allocation of digital dividend, taking into Regional Radio Conference account the ITU’s Radio Conference 2007 World 2006 and ITU’s the Authority held back resolutions. However, on the consultation process until standard for digital broadcasting in South Africa had been JVUÄYTLK6U1HU\HY`[OL4PUPZ[LYVM Communications publicly announced Cabinets decision that South Africa will follow the DVB-T2 standard, which re-emphasised the need for Authority to continue the project on examining the regulatory approaches to the allocation of Digital Dividend spectrum (790-862 MHz). ;OL(\[OVYP[`YLSLHZLKÄUHS4\UPJPWHS,SLJ[PVUZ regulations on 8 March 2011 (GG 34086). These regulations govern the allocation of public election broadcast slots in a fair and equitable ahead of the 18 May 2011 municipal manner, elections. The ECA mandates the provision of a certain number of Party Election Broadcast (PEBs) slots to be and Political Advertisements (PA) made available to all parties. The impact of these regulations is that they create the framework shall and guidelines under which PEBs PAs be conducted and carried by the broadcasting service licensees, during the municipal elections in May 2011. Target Report to the Minister of Communications published Unit of Measurement Report Recommendations (Output) Key Performance Indicator Regulatory Recommendations to the Minister of Communications on possible regulatory policy approaches to the Digital Dividend (the 790-862MHz zone for Africa) Final Regulations Final Regulations Final Regulations

Area Examine the options arising from the release of spectrum afforded by the digital switchover programme (from the Digital Divi- dend) (Phase 2) the fair and equitable allocation of public election broadcast timeslots to political parties for the municipal elections Municipal Elections regulations Strategic Goals Key Performance open, transparent and non- discriminatory allocation of the digital dividend for socio- economic development of South Africa. KPI No. -\SÄSTHUKH[LHUKKLSP]LYZLY]PJLZLMMLJ[P]LS`HUKLMÄJPLU[S` 3.1 ensure a competitive, fair, To 2.2 Framework governing

55 - 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY ;OL(\[OVYP[`YLSLHZLKÄUHSYLN\SH[PVUZNV]LYU ing the provision of call termination services on 29 October 2010 (GG 33698).The Authority PU[YVK\JLK[OLÄYZ[WYVJVTWL[P[P]LWYPJLJVU[YVS mechanism under the Electronic Communications namely the gradual reduction of ter- Act this year, TPUH[PVUYH[LZ[VIV[OTVIPSLHUKÄ_LKSVJH[PVUZ Rates charged for termination to a mobile location are set to reduce from R 0.73 (peak-time) on 1 March 2011 to R 0.40 on 2013 (all KH`;LYTPUH[PVUYH[LZ[VHÄ_LKSVJH[PVUPZ[V reduce from a maximum of R 0.28 on 1 March 2011 to R 0.19 on 1 March 2013 (for between billing zone termination). This intervention is expected to introduce greater price competition in the provision of retail voice services. ÄUHUJPHS`LHYIHZLKVU[OLYLWYPVYP[PZH[PVUVM the business plan to include Municipal Election regulations. Target Final Regulations published and internal reports Unit of Measurement Regulations / reports RIA report RIA report The project was postponed to the 2011/12 (Output) Key Performance Indicator Wholesale call termination: implementation of pro-competitive remedies Piloting the implementation of RIA on the Regulation of Digital Dividend Area Market review on call termination (Phase 2) Implementation and regularisation of the use of Regulatory Impact Analysis (RIA) for ICASA Regulatory projects (Phase 2) - Strategic Goals Key Performance ble, dynamic and innovative competition in the electronic communications, broadcasting and postal sectors to deliver high quality. age the Radio Frequency Spectrum when regulating the Electronic Communica- tions, Broadcasting and Postal Sectors Encourage Innovation, Pro- tect and Inform Consumers, ,MÄJPLU[S`HUK,MMLJ[P]LS`4HU KPI No. MARKETS AND COMPETITION ANALYSIS of competition in the ICT Sector Liberalisation and promotion 1.1 promote sustainable, sta- To 4.1 promote Competition, To Enhance business processes and intelligence, governance Enhance business processes & reporting

56 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY and collation of statistics regarding the ICT sec- These statistical measurements have been tor. included in the Compliance Procedures Manual. The manual is to be completed in the 2011/12 ÄUHUJPHS`LHYPUJS\KPUN[OLPU[YVK\J[PVUVMHU VUSPULH\[VTH[LKZ`Z[LT[VJVSSLJ[[OLPKLU[PÄLK indicators. The Authority received forty two (42) interconnection and 26 facilities leasing agreements during The Authority also received eight (8) the year. disputes, which will be addressed during the ÄUHUJPHS`LHY;OLPTWSLTLU[H[PVUVM the interconnection and facilities leasing regulations gazetted in April and May 2010 respectively have changed the nature of content traditional agreements. In addition, the Authority is close to completing the introduction of an online database where licensees will be able to submit all agreements online therefore reducing the Authority’s turn-around times. The Authority instituted an inquiry process to establish the need for any regulatory intervention in the provision of wholesale signal distribution services. The Authority issued a request for information on 6 October 2010. However, the Authority was prevented from completing a KPZJ\ZZPVUKVJ\TLU[[OPZÄUHUJPHS`LHYV^PUN[V delays in collecting information from stakeholders. In addition, preparatory work on a public market review in the provision of premium content was completed. implementation of Local Loop Unbundling according to the Ministerial Directive ensure that LLU takes place by November 2011. Target Internal Report The Authority undertook to improve its collection Final Regulations & Monitoring Reports Findings document by March 2011 Unit of Measurement Framework for collecting industry data to facilitate ITU obligations Regulations/ Quarterly reports Findings document Final Regulations Regulations The Authority has reviewed its approach to the (Output) Key Performance Indicator Database of trends performance in the ICT sector Framework interconnection and facilities leasing regulations. Quarterly reports on IX/FL agreements reviewed. Effective and LMÄJPLU[YLZVS\[PVUVMKPZW\[LZ Market review on wholesale signal distribution and content Market review on Wholesale Local Access (WLA) and end-to- end leased lines Area Enhance the Authority’s Enhance the Authority’s knowledge regarding industry trends Facilitate interconnection (IX) and facilities leasing (FL) tate competition in the broadcasting sector (Phase 2) purpose of introducing Local Loop Unbundling (LLU) Strategic Goals Key Performance asymmetry between the Authority and licensees and facilitating interoperability and interconnection of networks and access to facilities KPI No. 1.5 Reducing the information 1.4 Reduce costs by promoting 1.3 Market reviews to facili- 1.2 Market reviews for the

57 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY SVKNLTLU[WYVJLZZK\YPUN[OLÄUHUJPHS year. The Authority did not amend any processes of procedures for the lodging of retail tariffs by licens- LLZK\YPUN[OPZÄUHUJPHS`LHY;OL(\[OVYP[`^PSS introduce an online system to automate the tariff The report on the level and structure of retail [HYPMMZ^HZJVTWSL[LK;OL(\[OVYP[`YLJLP]LKÄM[` [HYPMMUV[PÄJH[PVUZK\YPUN-YVT[OL monitoring of retail tariffs, the Authority has noticed a decline in overall retail prices faced by consumers. Furthermore, the Authority has noticed a substantial increase in the number of services and tariff plans a customer may now choose. The increase in the types of service available are indicative of changing technologies and the introduction of smartphones in the South African market. code of practice governing handset subsidies on 18 March 2011 (GG 34131). Target Input to Retail Market Study Progress and Moni- toring Reports Final Code of Practice The Authority released its position regarding a Unit of Measurement Regulatory approach document Monitoring progress report Practice

(Output) Key Performance Indicator Standard tariff lodgement framework and the development of data collation system. Regulatory approach to Retail and recommendations to Tariffs promote more competitive pricing and choice for consumers. A report on the level and structure of retail tariffs for electronic communication services. Code of Practice Final Code of Area regulatory approach to (elec- Retail Tariffs tronic communication services) Investigate and report on the level and structure of Retail Tariffs. Monitor the interconnection pass through to Retail tariffs. Finalisation of Code Practice Strategic Goals Key Performance ble, dynamic and innovative competition in the electronic communications, broadcasting and postal sectors to deliver high quality services at competitive prices regulations (Subscriber-end- user terminal equipment) KPI No. 1.2 Development of a MARKETS AND COMPETITION AND NUMBERING ECONOMIC, FINANCIAL ANALYSIS of competition in the ICT Sector Liberalisation and promotion 1.1 promote sustainable, sta- To 1.6 Review of handset subsidy

6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY The Authority approved a four and half percent (4.5%) general increase for reserved postal ser- initial appli- vices for 2011/12, rather than SAPO’s cation for a six and half percent (6.5%) increase. On 24 January 2011 (GG 33953). The impact of the decision is that customers were protected against excessive tariff increases without compro- TPZPUN[OLÄUHUJPHS]PHIPSP[`VM:(76 ;OL(\[OVYP[`W\ISPZOLK[OLÄUHS(JJV\U[PUN Separation regulations for SAPO on 16 March 2011 (GG 34130). This framework ensures that the costs of providing universal postal services is transparent. ;OL(\[OVYP[`ÄUHSPZLK[OL7YPJL*HWYLN\SH[PVUZ for retail prices reserved postal services on 16 March 2011 (GG 34129). These regulations will ensure that consumers are protected in terms of the prices charged for services in the reserved postal services basket (e.g. letters and postcards). Target Publication of Ap- proved Fees & Charges Unit of Measurement Publication of Approved Fees & Charges Final Regulations Final Regulations Final Regulations Final Regulations (Output) Key Performance Indicator Authority’s Decision on SAPO’s Decision on SAPO’s Authority’s tariff regime lodgement. Regulations on accounting separation pertaining to the reserved postal sector Regulations on price setting for reserved postal sector Area Review of SAPO’s Review of SAPO’s [HYPMMÄSPUN latory Financial Report- ing (RFR) requirements pertaining to the postal sector (Phase 2) ment of economic regulatory framework pertaining to the reserved postal sector (Phase 2) Strategic Goals Key Performance services at affordable prices KPI No. -\SÄSTHUKH[LHUKKLSP]LYZLY]PJLZLMMLJ[P]LS`HUKLMÄJPLU[S` 2.1 Promote access to basic 1.4 Development of Regu- 1.3 Review and develop-

59 - 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY ;OL(\[OVYP[`YLJLP]LK[OYLLO\UKYLKHUKÄ]L (305) numbering applications during 2010/11. The Authority has also noted the increasing demand for alpha-numeric numbers in the 080 and 086 number range, indicating increased competition for inbound and sharecall call services. The Authority released draft regulations governing the use of numbers under Electronic Com- munications Act. This numbering plan intends to update numbering assignment take into account technological developments, including machine to number utilisation (e.g. simcards in data dongles). The Authority did not ÄUHSPZL[OLU\TILYPUNWSHUPU[OL`LHY and intends to complete the plan in 2011/12 ÄUHUJPHS`LHY The Authority was unable to complete a full number audit for 2010/11 owing to most licensees MHPSPUN[VZ\ITP[PUMVYTH[PVU^P[OPU[OLZWLJPÄLK timeframes. The Authority reported this non- compliance to the CCC, where operators were given up to 16 February 2011 before these cases were then automatically referred to the CCC - Chairperson for consideration. By the LUKVMÄM[`WLYJLU[ VM[OL operators submitted audit data. Licensees who audit data failed to comply with the Authority’s submission requirements despite numerous ex- tensions granted will be considered by the CCC PU[OLUL^ÄUHUJPHS`LHY;OLH\KP[VMSPJLUZLLZ who submitted information was postponed to ÄUHUJPHS`LHY^P[OWSHUZ[VPUJVYWV rate it with the 2011/2012 planned audit. - Target Report on Allocation of Numbers Regulations 5\TILYVM(\KP[ÄUK ings per Licensee Unit of Measurement Allocation of Numbers Numbering Plan Final Numbering Plan Internal Report (Output) Key Performance Indicator Allocation of Numbers to licensees and central number database updates Finalisation of Numbering Plan Regulations Report on framework for conducting Number Audits and Conduct Audit as per ECA Number Plan requirements Area ing applications ment of Numbering Plan Regulations in terms of ECA Ensure that numbering rules, numbering conventions and structure of the plan are in place transpar- to allow fair, ent and non discriminate allocations of numbers to licensees. Strategic Goals Key Performance non discriminate allocations of numbers to licensees (competition) and provide Z\MÄJPLU[U\TILYPUNJHWHJP[` for existing and future numbering demands KPI No. 3.3 Evaluation of Number- 3.2 Review and develop- 3.1 transparent and Ensure fair, Liberalisation and promotion of competition in the ICT Sector Liberalisation and promotion

60 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY The consultant obtained to assist with the licenc- ing was an International consultant. In terms of the PFMA an approval is required from the Minister. ;OPZWYVJLZZOHZUV[`L[ILLUÄUHSPZLK and the regulations published in August 2010. The spectrum fees software could not be implemented due to lack of funding the new spectrum management software. The effective date for the regulations has been deferred to 1 April 2012. The spectrum fees framework was developed The research indicated that ETOEs have both a positive and negative impact on existing postal services, whilst enhancing competition within the particularly for international mail. However, sector, of crucial importance is the need to establish a new regulatory framework for such operations, which will be completed in 2011/12. ;OL(\[OVYP[`WHZZLK[OLÄUHS*HYYPLY7YLZLSLJ[ regulations on 27 September 2011 (GG 33589). These regulations require that licensees’ customers be given an opportunity to choose their preferred service provider on a call by basis. The Authority intends to facilitate implementation in the 2011/12 year. Target Number of licenced entities; more than 2 nationally and more than 5 regionally 95% implementation of plan Research Recom- mendations Report Unit of Measurement Number of licenced entities Extent of implementation Recommenda- tions report Final Regulations Final Regulations (Output) Key Performance Indicator 2.6 and 3.5 GHz broadband spectrum licenced Software implementation of spectrum fees framework Recommendations to DOC for Policy Development on ETOEs and Re-mailing. Promulgation of Carrier Pre Selection Regulations Area demand bands Implementation of a new spectrum fees framework and system Research development on the Extra Territorial 6MÄJLZVM,_JOHUNL (ETOES) and Re- mailing in the SA Postal Sector. Ensure Carrier Pre Selection (Phase 2)

Strategic Goals Key Performance LMÄJPLU[THUHNLTLU[VM spectrum and technology (Spectrum licensing and management and equipment type approval programme) within the postal sector and to provide postal services that are responsive to consumer needs business in South Africa by encouraging effective competition through increased access to infrastructure, diversity of service, competitive prices and greater choice for consumers KPI No. 1.2 Licensing of high ENGINEERING AND TECHNOLOGY of competition in the ICT Sector Liberalisation and promotion 1.1 enable effective and To MARKETS AND COMPETITION POLICY AND RESEARCH POSTAL of competition in the ICT Sector Liberalisation and promotion 1.1 promote Competition To 4.1 reduce the cost of doing To Liberalisation and promotion of competition in the ICT Sector Liberalisation and promotion

61 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY VM\WKH[LZHUKTVKPÄJH[PVUZJVTWSL[LK and National Frequency Band Plan published. Total of two thousand three hundred and forty Total eight (2348) applications was processed. An- nual average turnaround times for applications processed within turnaround times and twice the [\YUHYV\UK[PTLZVMUPUL[`Ä]LWLYJLU[ HUK four percent (4%) were achieved respectively. This is higher than ninety percent (90%) and ten percent (10%) targeted for. A total of three thousand six hundred and twenty six (3626) applications processed. Annual average turnaround times for applications processed within turnaround times and twice the [PTLZVMUPUL[LLU HUK[^LU[`Ä]L Low turnaround were achieved respectively. times achieved due to a spectrum management system not being implemented. Target 90% of planned work completed 90% within turnaround time; 10% within 2 times turn around 90% within turnaround time; 10% within 2 times turn around - - - Unit of Measurement Number of frequency updates HUKTVKPÄJH tions Percentage of applications processed within KLÄULK[\YU around time Percentage of applications processed within KLÄULK[\YU around time (Output) Key Performance Indicator

62 - 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY Not achieved due to lack of resources do research and produce the frequency migration plan. -P]LVM[OLZP_PKLU[PÄLKIHUKZ^LYLTVUP [VYLKHUKHUHS`ZLKZH[PZMHJ[VYPS`MVY[OLÄUHUJPHS One band was monitored but results were year. incomplete for analysis. Targets Achieved for Time to Respond, Time to Respond, Time Achieved for Time Targets were achieved as to Repair and Site Availability follows: Performance Reports Submitted: Target Achieved. to Respond Time Achieved. Gauteng: 24 hrs.: Target Achieved. Regional: 2 days. Target to Repair Time not Power related issues: 1.25 days: Target Achieved. not achieved. System related: 11 days: Target Achieved. Receiver related: 2.75: Target Achieved. 69 %: Target Site Availability: Target Frequency Plan migration Documentation 6 Bands: - 161.875 -167.875 MHz - 167.8875 -173.8750 MHz - 406 410 MHz - 2500 – 2690 MHz - 3400 – 3600 MHz - 2300 – 2400 MHz - Response time: within 24 hrs. in Gauteng and within 3 days in the regions. to repair: 24 -Time hrs. for power related problem, 7 days for system related problem, 3 months for receiver related problem. an aver- - Availability: age of (n-1)/n over 3 months (where n is the number of sites) Unit of Measurement Frequency Plan migration Docu- mentation Bands audited Response time; to repair Time and availability (Output) Key Performance Indicator 10 year frequency migration plan. Reliability and availability of the monitoring network. Area quency migration plan for harmonisation. spectrum monitoring WAN Strategic Goals Key Performance KPI No. 2.4 Development of a fre- 2.3 Spectrum audit Analysis of bands audited Number of 2.2 Maintenance of the

63 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY Participation by selected staff in WRC-12 preparatory meetings, IQPC conference and ICT Africa. Collaboration with universities of Witwatersrand and Pretoria to produce reports inform rule making. Successfully co-ordinated all ICASA activities con- Cup World tributing to the success of 2010 FIFA Coordination “policies” and procedures in place (incorporated in the radio regulations). Spectrum licensing regime in place (incorporated in Radio regulations). 6MÄJPHSSPZ[VMZ[HUKHYKZOH]LILLUYL]PL^LKHUK approved by ICASA/SABS liaison committee. Ready for publication. The revised type approval framework has been developed. Regulations are still being drafted for public comments. Target Participate in all technical forum activities 1 and 2 research reports ment of quarterly planned activity nation “policies” and procedures published licensing regime and regulations published Required and planned entries in the list published Develop revised Type Develop revised Type Approval Framework Unit of Measurement Participation in technical forums Research Report produce phase To Plan At least 90% achieve- Gazette Regulations Gazetted Radio regulations in place. Report Report and Coordi- Report Report on spectrum Required and planned entries updated in the VMÄJPHSSPZ[VM standards. Documentation for type approval framework (Output) Key Performance Indicator Participation and contribution THKLHUKILULÄ[ZKLYP]LKMYVT participation. Research papers and technical presentations to inform rule making. Success and achievements in Cup World 2010 FIFA Revised radio regulations in place Coordination “policies” and procedures in place Spectrum licensing regime in place -PUHSPZLLU[YPLZPU[OLVMÄJPHSSPZ[ based on requirements. Revised type approval Frame- work Area cal forums. Engagement of tertiary and research institutions. Ensuring the success World of 2010 FIFA Cup. lations assignment and coordination “policies” and procedures – e.g. microwave, trunking systems, alarms, etc. concise spectrum licensing regime aligned with the Act 9L]PL^VM[OLVMÄJPHS list of standards to produce the updated list of standards Review of equipment type approval framework to simplify and be aligned with time - Strategic Goals Key Performance agendas/ forecast on spectrum and technology issues to inform policy development and rule making (Research and advisory programmes) LMÄJPLU[THUHNLTLU[VMZWL cial event (Special events) to advise relevant stakeholders and to identify develop regulations and standards to strengthen the regulatory environment and encourage support managed introduction of new technologies. (Policy review, rule making and standardiza- tion) KPI No. 5.2 Participation in techni- Monitor, adjudicate and enforce compliance with regulations and the law compliance with regulations adjudicate and enforce Monitor, 5.1 enable development of To -\SÄSTHUKH[LHUKKLSP]LYZLY]PJLZLMMLJ[P]LS`HUKLMÄJPLU[S` 4.1 enable management of To 3.5 Review of Radio regu- 3.4 Development of 3.3 Development of a 3.2 3.1 identify policy imperatives To Monitor, adjudicate and enforce compliance with regulations and the law compliance with regulations adjudicate and enforce Monitor,

64 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY Four (4) strategic frameworks were developed. Monitoring reports were produced for each quarter. Website updated with spectrum usage for highly Website used bands, spectrum and equipment type approval licences issued and Spare Community Broadcasting frequencies. Contributions to the various committees were staff. made by Engineering and Technology Report on measurements and analysis undertak- LUZOV^LKUPUL[`Ä]LWLYJLU[ VMWSHUULK work was completed. Target 4 x Strategic frameworks for each quarter. 4 x Monitoring reports. Report compiled on spectrum usage quarterly Quarterly internal report on E&T resources usage To cover and report To on measurements and analysis undertaken Unit of Measurement Monthly monitoring reports Internal quarterly report on Spec- trum usage of given tasks versus achieved and other mean- ingful contribution made. Area covered and amount of measurements and analysis (Output) Key Performance Indicator 4 x Strategic frameworks for each quarter and 4 x Monitoring reports Information updated on the website and provided to stakeholders per plan. Contribution made. Comparison Area covered and amount of measurements and analysis. Area Develop Public Educa- tion and Awareness strategic framework Monitor implementation of strategy tion. project in other divisions and to address requests from divisions and other stakeholders. e.g. – Interconnection – Local loop unbundling Technical measure- Technical ments to support consumer protection programmes – e.g. “connection failure” rates and drop calls in mobile services. Strategic Goals Key Performance and Awareness Strategy, and Strategy, and Awareness Monitor Implementation and giving of technical ad- vices to other divisions and stakeholders KPI No. CONSUMER AFFAIRS DIVISION CONSUMER AFFAIRS -\SÄSTHUKH[LHUKKLSP]LYZLY]PJLZLMMLJ[P]LS`HUKLMÄJPLU[S` 1.1 provide Public Education To 6.3 Information dissemina- 6.2 Addressing tasks for 6.1 enable managed support To -\SÄSTHUKH[LHUKKLSP]LYZLY]PJLZLMMLJ[P]LS`HUKLMÄJPLU[S`

65 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY Project deliverables included in KPI 1.2 and 2.2 The National Summit was successfully hosted on 15 and 16 March 2011. Strategic frameworks for the national campaigns were developed and provided for implementation. National campaigns were hosted countrywide. Eight (8) out of nine (9) CRFs were established countrywide to assist the Authority with consumer protection initiatives, however monitoring reports OH]L`L[[VILÄUHSPZLK The targets of producing content for four (4) advertorials, eighteen (18) publicity banners and information pamphlets was achieved. Target Refer to KPI 1.2 and KPI 2.2 Hosting of National Summit Develop strategy framework for National campaigns for 5 x National Campaigns 9 x Monitoring reports on progress of meetings between CRFs and Education 6MÄJLYZ 4 x Advertorials. 18 x Banners. Post- ers, Pamphlets, Unit of Measurement and KPI 2.2 Summit for People with Dis- abilities Report on each campaign hosted CRFs meetings Approved promotional material content. Approved webpage content. Documented records for print and broadcast promotions. Documented records on promotional material. (Output) Key Performance Indicator Refer to KPI 1.2 and 2.2 Refer to KPI 1.2 National Summit held Report on the Strategic frameworks for: World Strategic frameworks for: World National Youth Day, Telecoms Interna- Post Day, World Day, tional Consumer Rights 9 x Monitoring reports. Reports on Published print material Printed promotional material Published webpage content Area Communicate regulatory activities Hosting of the National Summit Develop strategy for National campaigns Monitor progress of meetings between CRFs and Education 6MÄJLYZ Develop content for Consumer Educa- tion and Awareness material Strategic Goals Key Performance Facilitate public and stakeholder access to information relating to the Authority’s regulatory activities lead the National Summit on the Rights of People with Disabilities Campaigns Representative Forum (CRFs) and Awareness Strategy, and Strategy, and Awareness Monitor Implementation KPI No. 1.6/ 1.7 1.5 Plan, coordinate and project 1.4 Provide strategy for National 1.3 Meetings with Consumer 1.2 provide Public Education To

66 - 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY Twenty seven (27) Workshops were conducted seven (27) Workshops Twenty PU[OLÄUHUJPHS`LHYHUK*VWPLZVM[OL*VUZ\TLY Complaints Procedure were printed in the eleven VMÄJPHSSHUN\HNLZHUKKPZ[YPI\[LKJV\U[Y` wide. The annual target of sixty percent 60% all complaints recorded has been exceeded, with an achieved success rate of resolving sixty eight percent (68%) of consumer complaints received and recorded. Target Produce and distribute 200,000 copies of consumer complaints procedure pamphlets. Conduct 20 presentations per annum. Sixty percent (60%) of all complaints received to be resolved within [OLÄUHUJPHS`LHY Unit of Measurement Number of consumer complaints procedure copies distributed. Number of presentations / workshops conducted. Reports on presentations / workshops conducted. Number of acknowledgement letters to complainants. Number of JVTWSHPU[ZÄSLZ opened and closed. (Output) Key Performance Indicator Consumer complaints proce- K\YLWYVK\JLKPUVMÄJPHS languages. Presentations / workshops on consumer complaints manual conducted. Consumer protection banners produced All Complaints received are YLJVYKLKHUKÄSLK sixty percent (60%) of all complaints received to be resolved ^P[OPU[OLÄUHUJPHS`LHY

Area Conduct presentations / workshops on consumer complaints manual Distribute consumer complaints procedure. Consumer complaints procedure available in VMÄJPHSSHUN\HNLZ Manage and facilitate the resolution of consumer complaints within 30 working days Receive, record and acknowledge complaints within 48 hours. Strategic Goals Key Performance resolving mechanisms the resolution of consumer complaints KPI No. 2.2 strengthen the complaints To 2.1 manage and facilitate To

6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY Six (6) out of ten (10) Relationship building meetings on consumer protection were held with VWLYH[VYZPU[OLÄUHUJPHS`LHY(M\Y[OLY[OYLL meetings with all operators were held in preparation for the National Summit where consumer protection issues were discussed. One (1) out of four (4) Monitoring reports pro- K\JLKK\YPUN[OLÄUHUJPHS`LHY Six (6) Desktop studies were done in the ÄUHUJPHS`LHYHZWSHUULK;OLYLZLHYJO[VWPJZ! - Exploration of consumers’ interest, understanding and awareness of the pre-paid starter packs contracts’ terms and conditions. - Benchmark study on consumer guidelines for People with Disabilities. - Benchmark study on approaches to protect consumers from illegal / unapproved telecommunications and radio communications equipment. - Consumers’ experience with Faulty Handsets ^OPJOHYL[LJOUPJHSS`PKLU[PÄLKHZSPX\PKKHTHNLK - Benchmark study on billing complaints. - Benchmark study on Post Paid contract Terms and conditions. (2) Outsourced research studies were Two conducted: - Consumers’ experiences and perceptions on accessibility and reliability of electronic availability, communications, broadcasting and postal services. - Assessment of nature access to electronic communications,broadcasting and postal services by People with Disabilities. Target 10 x meetings with operators to build relationships 4 x Compliance reports 6 x Reports on in-house desktop research. 2 x Reports on outsourced research Unit of Measurement Quarterly meetings with operators reports Research reports (Output) Key Performance Indicator Relationship building meetings held with operators 4 x Compliance reports Compliance 6 x Reports on desktop resea rch. 2 x Reports on outsourced research studies. Area Build relationships with operators on consumer protection Monitor compliance with consumer protection regulations Conduct 6 in-house desktop research studies on consumer protection. Outsource 2 research studies on consumer issues. Strategic Goals Key Performance protection matters with operators consumer protection regulations sumer protection KPI No. -\SÄSTHUKH[LHUKKLSP]LYZLY]PJLZLMMLJ[P]LS`HUKLMÄJPLU[S` 4.1 strengthen consumer To 3.2 monitor compliance with To 3.1 conduct research in con- To Monitor, adjudicate and enforce compliance with regulations and the law compliance with regulations adjudicate and enforce Monitor,

68 - 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY *VTWSL[LKÄM[`[^VYHKPVMYLX\LUJ`KH[HJVS lection reports. This activity is demand driven. *VTWSL[LKVUL[OV\ZHUKÄ]LO\UKYLKHUK [^LU[`Ä]LSHILSSPUNPUZWLJ[PVUZ;OL[HYNL[ was exceeded by one hundred and eight percent (108%). Completed four hundred and sixteen (416) Spec- trum licence audits. The target was exceeded by VULO\UKYLKHUKÄM[`LPNO[WLYJLU[ Processed one thousand four hundred and twenty two (1422) pre-assigned Spectrum licences. E-Rate regulations were not published in this ÄUHUJPHS`LHY The Consumer Advisory panel regulations were reviewed and published for public comment. Four (4) out of nine (9) Relationship building meetings on consumer protection were held with the Associations for People with Disabilities in ÄUHUJPHS`LHY(M\Y[OLY[OYLLTLL[PUNZ^P[OHSS Associations were held in preparation for the Na- tional Summit where consumer protection issues were discussed. Target 204 frequency data collection reports submitted 600 Labelling inspection reports completed 200 Spectrum licence audit reports completed 960 pre-assigned spectrum licences processed E-Rate regulations published Reviewed CAP regulations 9 x Meetings with associations for people with disabilities Unit of Measurement Number of Radio frequency data collection reports submitted Number of labelling inspection reports completed Radio dealer/ alarm company/ repeater systems audit Number of pre- assigned spectrum licences processed regulations Publication of regulations Quarterly meetings with associations for people with disabilities (Output) Key Performance Indicator assignment Inspection of distribution & selling of electronic equipment Number of spectrum licence audit reports completed Process pre-assigned Spectrum licences Published E-Rate regulations Publication of Published reviewed CAP regulations Relationship building meetings held with associations for people with disabilities. Area checks company/repeater systems audit Spectrum licences E-Rate regulations review of Consumer Advisory Panel (CAP) regulations Build relationships with associations for people with disabilities on consumer protection Strategic Goals Key Performance associations for people with disabilities KPI No. 1.4 Spectrum Monitoring Radio Frequency monitoring 1.3 Labelling compliance 1.2 Effective control of spectrum Radio dealer/alarm REGIONS and the law compliance with regulations adjudicate and enforce Monitor, 1.1 Renew Spectrum licensing Renew pre-assigned 4.4 E-Rate regulations Provide support on 4.3 review regulations To Provide support on the 4.2 maintain partnership with To

69 - 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY Completed eighteen (18) district community forums. Achieved one hundred percent (100%) of target. Conducted six (6) national campaigns. Thirty two percent (32%) of target was achieved. The target was not achieved by sixty six percent (66%). *VUÄYTLK[^VO\UKYLKHUKUPUL[`Ä]L [LJOUPJHSZWLJPÄJH[PVUZVML_PZ[PUNSPJLUJLWLY was exceeded by one system installed. Target hundred and eighty nine percent (189%). Resolved four hundred and sixty nine (469) PU[LYMLYLUJLZ;OL[HYNL[^HZL_JLLKLKI`ÄM[LLU percent (15%). 0ZZ\LKMVY[`MV\YJLY[PÄJH[LZ;OPZV\[W\[PZ demand driven. Only twenty two percent (22%) of our targeted requests was received for new installations. *VTWSL[LK[^VO\UKYLKHUKMVY[`Ä]LMYL achieved eighty percent quency data reports. We (80%) of target because higher emphasis was put on client requests. Target 18 Attendance registers submitted with summary of outcomes. 19 Attendance registers submitted with summary of outcomes. 108 radio interviews Conducted seventy one (71) radio interviews. 102 compliance UV[PÄJH[PVUZPZZ\LK 408 Interference reports completed 204 Commissioning JLY[PÄJH[LZPZZ\LK 306 frequency data collection reports submitted - - Unit of Measurement Number of attendance registers submitted with summary of outcomes. Number of attendance registers submitted with summary of outcomes. interview sched- ules signed by radio announcer/ interviewer tions issued Number of com- WSPHUJLUV[PÄJH Number of interference reports completed Number of com- TPZZPVUPUNJLY[PÄ cates issued Number of Radio frequency data collection reports submitted (Output) Key Performance Indicator forums (Group of municipalities workshop) (World Consumer Rights Day (World and information society) Conduct radio interviews. Number of radio *VUÄYTPUN[LJOUPJHSZWLJZ of existing licence per system installed Mitigation and resolution of radio frequency interference *VUÄYTPUN[LJOUPJHSZWLJZVM new installations monitoring Area Conduct consumer awareness tion and resolution tem commissioning Strategic Goals Key Performance and awareness KPI No. 2.3 Conduct district communications 2.2 Conduct national campaigns -\SÄSTHUKH[LHUKKLSP]LYZLY]PJLZLMMLJ[P]LS`HUKLMÄJPLU[S` 2.1 Conduct public education 1.8 High-site inspections 1.7 Interference investiga- 1.6 Radio Frequency sys- 1.5 Effective control of spectrum Spectrum Monitoring Radio Frequency compliance

70 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY stantial savings in legal costs achieved. Out of twenty (20) pending regulatory litigation matters, only four (4) from prior years remaining. Regions completed six hundred and eighty two ZLHSPUNÄSLZ;OPZ[HYNL[PZKLTHUKKYP]LU and was achieved by seventy six percent (76%). 7VZ[HSPUZWLJ[VYZTVUP[VYLKHUKPUZWLJ[LKÄM[` seven (57) unreserved postal outlets. This task was achieved and exceeded by nineteen percent (19%). resolved. This task is demand driven seventy seven percent (77%) of target was reached. Postal inspectors conducted three hundred and LPNO[`Ä]L :(76PUZWLJ[PVUZHUKLPNO[` nine percent (89%) of the target was achieved. *VTWSL[LKÄM[`Ä]LJVTT\UP[`^VYRZOVWZ Exceeded the target with one hundred and four percent (104%). Conducted sixteen (16) local municipality workshops. Eighty percent (80%) of this target was achieved. - Target :LHSPUNÄSLZJVT pleted 48 inspection reports completed. 48 reports completed Thirty seven (37) complaints were received and 432 inspection reports completed. 27 Attendance registers submitted with summary of outcomes. 20 Attendance registers submitted with summary of outcomes. - Unit of Measurement Quarterly Report 4 Sub- Reports were prepared for each quarter. Number of ZLHSPUNÄSLZJVT pleted Number of inspection reports completed. Number of reports completed. Number of compliance reports completed. Number of attendance registers submitted with summary of outcomes. Number of attendance registers submitted with summary of outcomes. (Output) Key Performance Indicator Provide a report on ICASA litigation matters Trace operator and seal radio Trace equipment Inspection of unreserved postal services outlets from the public Conduct inspection of SAPO outlets to enforce adherence licence conditions (i.e., Township groups, school, (i.e., Township group, youth stokvel, women’s group, or civil association workshops) & Consult and interact with consumers in collaboration with CRFs ( Consumer Repre- sentative Forums) Conduct local workshops (Mu- nicipality workshops) Area Safeguard ICASA interest in litigation and general legal affairs renewed spectrum licences served postal services Monitoring of SAPO licence conditions. Conduct consumer awareness Strategic Goals Key Performance support conditions and awareness KPI No. LEGAL AND COMPLAINTS COMPLIANCE COMMITTEE LEGAL and intelligence, governance Enhance business processes & reporting 1.1 Litigation and General legal -\SÄSTHUKH[LHUKKLSP]LYZLY]PJLZLMMLJ[P]LS`HUKLMÄJPLU[S` 4.1 Enforcement of legislation Investigation of non- 3.3 Monitoring of unre- 3.2 Investigate complaints received Monitor, adjudicate and enforce compliance with regulations and the law compliance with regulations adjudicate and enforce Monitor, 3.1 Monitor licence terms and 2.5 Conduct community workshops 2.4 Conduct public education

71 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY than sixty percent (60%) of our opinions were ÄUHSPZLK\ZPUNPU[LYUHSYLZV\YJLZ thirds (2/3) of the regulations received for review HUK]L[[PUN^LYLÄUHSPZLK]PHPU[LYUHSYLZV\YJLZ The improved quality of our regulations has led to less exposure to court reviews. thirds (2/3) of the regulations received for review HUK]L[[PUN^LYLÄUHSPZLK]PHPU[LYUHSYLZV\YJLZ The improved quality of our regulations has led to less exposure to court reviews. TLU[ZWVSPJPLZHUKV[OLYPUZ[Y\TLU[ZHYLÄUHSPZLK utilising internal resources. Three Reports were prepared for each quarter. TH[[LYZÄUHSPZLKMV\YWLUKPUNHUKVY awaiting CCMA dates and awards. Only Reports were prepared for each quarter. one matter was outsourced to external attorneys to attend the re-renewal of ICASA trade mark in the fourth quarter. was given to internal clients from legal advice to drafting letters. Some advise was provided pro-actively in order to minimise the risks or even prevent litigation. stantial and above average number of opinions drafted internally. tracts are drafted, vetted and negotiated utilising internal resources. Target Unit of Measurement Quarterly Report 4 More Reports were prepared for each quarter. Quarterly Report 4 Two- Reports were prepared for each quarter. Quarterly Report 4 Two- Reports were prepared for each quarter. Quarterly Report 4 Docu- Reports were prepared for each quarter. Quarterly Report 4 Sub- Reports were prepared for each quarter. Quarterly Report 4 Con- Reports were prepared for each quarter. (Output) Key Performance Indicator Provide a report on legal opinions submitted to committees and divisions Provide a report on steps to be legal taken to mitigate ICASA’s risks Provide a report on the status of the regulations and reasons document submitted for vetting Provide a report on steps taken legal risks to Mitigate ICASA’s ions prepared. Provide a report on documents drafted and/or vetted. Provide a report on contracts drafted. Area to regulatory divisions and projects regulatory processes, documents, discus- sion papers, regulations etc. Ensure that ICASA dis- charges its regulatory mandate within the law vetting Contracts: drafting & vetting Strategic Goals Key Performance lative Drafting support KPI No. 2.3 -On-going legal advice 2.2 and review ICASA -Vet 1.51.61.7 Labour law 2.1 Commercial law Regulatory Support & Legis- General Legal Support Support Reports were prepared for each quarter. 1.4 Documents: drafting & 1.3 Legal opinions Provide a report on legal opin- 1.2 Litigation and General legal

72 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY Reports were prepared for each quarter. Matters Reports were prepared for each quarter. pending will resume once a chairperson has been appointed. The post has already YLHK]LY[PZLKHZ[OLYL^LYLPUZ\MÄJPLU[U\TILYVM Z\P[HIS`X\HSPÄLKWLYZVUZ Reports were prepared for each quarter. Matters Reports were prepared for each quarter. pending will resume once a chairperson has been appointed. The post has already YLHK]LY[PZLKHZ[OLYL^LYLPUZ\MÄJPLU[U\TILYVM Z\P[HIS`X\HSPÄLKWLYZVUZ was provided on the ECA. PRE/CRASA merger will integrate and harmonise the regulatory framework for the ICT industries. Memoranda of Understanding will ease relations between ICASA and other agencies reduce HYLHZVMJVUÅPJ[ gation of the Postbank into law on 8 December 2010 was the highlight for this item, though there is a delay on the SAPO Bill. than sixty percent (60%) of our opinions were ÄUHSPZLK\ZPUNPU[LYUHSYLZV\YJLZ Target Report to Council on activity Quarterly Report to Council Unit of Measurement Number of Com- plaints Number of Com- plaints Quarterly Report 4 Training Reports were prepared for each quarter. Quarterly Report 4 The SA- Reports were prepared for each quarter. Quarterly Report 4 The Reports were prepared for each quarter. Quarterly Report 4 Promul- Reports were prepared for each quarter. Quarterly Report 4 More Reports were prepared for each quarter. (Output) Key Performance Indicator Timeous resolution of intercon- Timeous nection and facilities leasing disputes Timeous resolution of disputes Timeous and complaints recommendations to ICASA on appropriate action/sanction provide a report on workshops held. provide a report on ICASA’s provide a report on ICASA’s obligations signed MoU by Chairperson and/or CEO provide a report on the proposed Bill provide a report on the proposed Bill Area nection and facilities leasing disputes from licensees Adjudicate disputes and complaints from licensees and consumers regulation drafting regional and international obligations ICASA on MOU’s with ICASA on MOU’s other institutions ICASA positions on legislative processes affecting ICASA -Review and advice on legislative matters affecting ICASA Strategic Goals Key Performance complaints lative Drafting KPI No. 3.2 Adjudicate intercon- COMPLAINTS AND COMPLIANCE COMMITTEE and intelligence, governance Enhance business processes & reporting 3.1 Investigate and adjudicate 2.8 -Capacity building in 2.7 -Advice ICASA on its 2.6 -Draft, review or advice 2.5 -Consult and prepare 2.4 Regulatory Support & Legis-

73 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY effective implementation of an integrated talent An in-house model has management strategy. been developed. Project is linked to the implementation phase of the organisational structure review process which OHZILLUL_[LUKLK[V[OLUL^ÄUHUJPHS`LHY The design of the dual career path framework was completed and implementation of the Dual The Career Stream was agreed to with Labour. implementation and communication plan was approved and will be implemented next year. The HR Development strategy was approved. Due to the revision of Phase 2 report presented in August and November 2010, the decision for which recommendations to accept was delayed. Aligned structure has been proposed to ICASA. A review of recommended structure TVKPÄJH[PVUZOHZJVTTLUJLK;OLWYVQLJ[PZ delayed by eleven (11) months. Reports were prepared for each quarter. Guide- Reports were prepared for each quarter. lines on the referral of complaints to CCC held with the Consumer completed. Workshop division. Target *VTWL[LUJ`WYVÄSLZ aligned to career- pathing framework Framework developed and implemented Strategy aligned Organisational Structure in accordance with the revised mandate Report to Council on activity Unit of Measurement Report Number of Com- plaints (Output) Key Performance Indicator TM strategy Strategy TM Strategy Plan was to obtain an automated tool for the *VTWL[LUJ`WYVÄSLZMVYHSSQVIZ Dual career stream Report Career pathing Annual training plan Plan HR Development Aligned organisational structure Report Implement New Finalize Processes and procedures regulations Conduct strategy workshop with CCC, Review Resource requirements, Regions on com- Workshop plaints handling process and procedures, Enforce Legisla- tion, Regulations and Licence conditions. Area Management (TM) strategy WYVÄSLZVMHSSQVIZ work for all levels Integrated talent development strategy. Conduct an organisational study to review mandate (ECA ICASA’s 2005) and alignment of the structure Effectively manage complaints process Strategic Goals Key Performance novation the organisational structure in accordance with the revised mandate (Phase 3) complaints KPI No. Enhance business processes and intelligence, governance Enhance business processes & reporting 3.1 Management Talent Integrated Talent 2.3 Reviewed competency 2.2 Career pathing Frame- 2.1 Culture of learning and in- HUMAN RESOURCES with strategy leadership and culture Align structure, 1.1 optimise and align Review, 3.3 Investigate and adjudicate

74 - - 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY ;OLTVKLSOHZILLUPKLU[PÄLKHUKHZLY]PJLWYV vider appointed. The inputs into the 360 degree for appropriate behaviour and the KPI descriptors for divisional scorecards was delayed to await the recommendations on approval of the strategy, structure review and career pathing framework implementation. Not implemented due to budgetary constraints. HR is partnering with Administration to ensure standardised approach with the automation of ÄSPUNZ`Z[LTZ The automation of payroll, leave, IRP5, payslips, : ;HUKV]LY[PTLJSHPTZOHZZPNUPÄJHU[S`YLK\JLK audit queries and improved the accuracy of management information and reports. (SSLTWSV`LLWLYZVUHSÄSLZOH]LILLU]LYPÄLKHUK outstanding documentation received, and VIP payroll system updated where necessary. The Employment Equity Plan was submitted to Budget constraints the Department of Labour. HYLOHTWLYPUN[OLTVKPÄJH[PVUZ[VMHJPSP[PLZHUK acquisition of suitable equipment for physically challenged persons. There were forty seven (47) vacancies at the ILNPUUPUNVM[OLÄUHUJPHS`LHY[OPY[`ZP_HW pointments were made. Interviewing techniques have improved with the use of other reliable TL[OVKZVMJVUÄYTPUNJHUKPKH[LZ\P[HIPSP[`Z\JO as written tests for mass temporary appointments and psychometric assessments for management and executives. The use of E-Recruitment system has reduced the lead time by thirty (30) days. Due to the delayed timelines for organisational structure review project the succession framework has not been initiated. Target Approved 360° framework for management levels and above. System agement Reports produced integrity on all aspects of work align Org Demograph- ics to geographical EAP (Economic Active Population) stats. Improve recruitment process lead time Framework Unit of Measurement mance evaluation framework Filing System Online Secure Filing Reports Accurate Man- Plan An approved plan to Scorecard & selection techniques Framework mapping Talent (Output) Key Performance Indicator 360 evaluation report 360 perfor- (SSWLYZVUULSÄSLZLSLJ[YVUPJHSS` stored Improved customer satisfaction level Reliable data Report Report on 100% Data Integrated Employment Equity (EE) plan Talent acquisition scorecard and Talent selection techniques Comprehensive succession management framework Area 360 performance evaluation framework ZVUULSÄSPUNZ`Z[LT Resources Information System (HRIS) system On-going review of HR operational processes [VPTWYV]LLMÄJPLUJ` Effective Diversity Man- agement Acquisition ment Framework Strategic Goals Key Performance the revised integrated Perfor- mance Management System (PMS) Processes and Controls risk KPI No. 5.1 Implementation support for 4.4 Introduce the e-Per- 4.3 Review the Human 4.2 Effective Internal Business 4.1 Mitigation of organisational 3.3 Best practices Talent 3.2 Management Talent Succession Manage-

75 - 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY The objective to produce a framework trans- form the remuneration structure was achieved and communication started in August 2010. The implementation communication process started in March 2011 and will continue into the next ÄUHUJPHSWLYPVK(NYLLTLU[OHZILLUYLHJOLK with CWU. The Administrator provides on-going support and advice the Management Committee is undergoing training for effective management of investment processes. The recommendations to reduce medical aid ZJOLTLZMYVTÄ]L[V[^V^LYLHWWYV]LK and the consultation process was undertaken. Only existing members as at 1 January 2011 would remain on the ring-fenced schemes until they leave the employ of ICASA or decide to transfer. Wellness status report showed an increased Wellness participation in both the referrals by management, ER cases relating self referrals and wellness day. to poor attendance have also declined. consultation meetings on remuneration and ILULÄ[ZTH[[LYZ^LYLJVUK\J[LK^P[OLTWSV`LLZ and their representatives. ;OLTVKLSOHZILLUPKLU[PÄLKHUKHZLY]PJLWYV vider appointed. The inputs into the 360 degree for appropriate behaviour and the KPI descriptors for divisional scorecards was delayed to await the recommendations on approval of the strategy, structure review and career pathing framework implementation. Target structure Performance Manage- and Talent ment frameworks Suitable management option for better investment value 3 Preferred MA Schemes by 31/03/2011 Improved Wellness Improved Wellness Status Report 4 Workshops Six (6) formal workshops were held and several ICASA’s Performance ICASA’s Indicators (PI) Unit of Measurement Report Competitive Salary Report to Council Council Improved Well- ness Status Report shops (Output) Key Performance Indicator Multi-tier remuneration structure for all levels Suitable Fund Management Structure 3 Approved Medical Aids Proposal to EAP and HIV & Aids Life threatening diseases strategy ER workshops No. of Work- Descriptors per division Scorecards Descriptors Aligned to Area Benchmarked multi-tier remuneration structure fund scheme rules for effective management of investment options Reduction of Medical Aids Assistance Pro- gramme (EAP) and HIV & Aids strategy to include management of other life threatening diseases Effective HR communication and consultation process for good relations Scorecard descriptors Strategic Goals Key Performance neration strategy ,TWSV`LL)LULÄ[ZZ[Y\J[\YL tions (ER) practices for the establishment of disciplined harmonised workplace KPI No. 8.1 of the remu- Transformation 7.2 Review of pension 7.1 Effective management of 6.2 Intensifying Employee 6.1 Sound Employee Rela- 5.2 Divisional Balance

76 - 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY No Reputation Survey was planned for the year. during 2010/11 to brief stakeholders about the 2010/11 Business Plan. A farewell Function for outgoing Chairperson Mashile was held for external stakeholders. responded to, and 86 media interviews arranged and conducted :L]LU[OV\ZHUKVULO\UKYLKHUKÄM[`LU quiries referred to relevant divisions for response Thirty eight (38) Media Statements issued and published on website. The 2009/10 ICASA Annual Report was produced and tabled in Parliament, distributed to stakeholders and published on the ICASA website. Seven hundred (700) hard copies printed, Ä]LO\UKYLK*+ZWYVK\JLK Two surveys were concluded and the results Two reported in May 2010 and October 2010. The design and report for the conversion to CTC process was concluded and work shopped for sensitisation to Council and RemCo in October 2010. Agreement with Labour was reached in November 2010 to implement at Management level. Communication process started in March 2011. Target None planned for the year 20 One hundred and eighty (180) media enquiries 6 000 40 media releases depending on projects delivered Hard Copies & 500 CDs ary survey reports on Market related salary structure Unit of Measurement Staff Presenta- tion dia interviews Number of Enquiries Number of Me- dia Releases Annual Report 2001/10 = 1,200 Report March and Sept sal- (Output) Key Performance Indicator Commission Perception/Reputa- tion Survey Host Stakeholders Meeting Host 1 meeting May & Oct 2010 One Stakeholder Meeting was held Arrange media interviews Number of me- Pilot Call Centre to respond enquiries Issuance of Media Releases to stakeholders & publish on website Production and Tabling of An- Production and Tabling nual Report 2 Surveys per year (general/ Specialised) No one should be worse off Report Consultation Report Area ees about industry perceptions about the Authority Authority’s regulatory Authority’s activities to public and stakeholders enquiries and stakeholder enquiries Authority’s regulatory Authority’s activities to public and stakeholders Communicate the regulatory Authority’s activities to public and stakeholders against the market Conversion of managers to Cost Company (CTC) salary packaging for tax LMÄJPLUJ` Strategic Goals Key Performance holder access to information relating to the Authority’s regulatory activities neration strategy KPI No. 1.6 Sensitise all employ- 1.5 Communicate the 1.4 Responding to media 1.3 Responding to public 1.2 Communicate the COMMUNICATION AND INTERNATIONAL RELATIONS AND INTERNATIONAL COMMUNICATION COMMUNICATIONS and intelligence, governance Enhance business processes & reporting 1.1 Facilitate public and stake- 8.3 Annual Salary Benchmark Benchmark ICASA 8.2 of the remu- Transformation

77 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY was achieved until mid February 2011 when the service provider went insolvent. Media monitoring for coverage of the Authority Photographing of all internal events, sworn-in cer- emonies of Councillors & Chairperson, CRASA- SAPRA meetings. Corporate gifts procured and distributed via CEO and Council, to visiting international delegations. Full extent of KPI not achieved due to budgetary constraints. conditions. ICASA Corporate Video translations produced and distributed. The ICASA Corporate video distributed to employees and all internal stakeholders. A video also produced of the CRASA- SAPRA meeting. No commissioning took place because of budget constraints. titles: New Contact details for the Durban and 7VY[,SPaHIL[OVMÄJLZHZ^LSSHZ*V\UJPS»Z Message to Stakeholders. New Year No media road shows took place during the year. Target Distribute daily Media monitoring reports , and quarterly Media analysis reports Photo-shoot of 20 internal & external events Procure 200 memory sticks, laptop bags, executive pens Commission production of 2 video clips during the year Commission production of 800 brochures 2 media notices Media Notices placed in leading daily and weekly 12 visits to media houses planned Unit of Measurement Media monitoring reports Photo albums on disc Corporate gift items Exhibition Stands 1 x Exhibition stand No commissioning took place because of budget Production Production of Brochures Place media notices Visits to media Houses (Output) Key Performance Indicator Commission Media Monitoring service / Newspaper subscription for Council and Executive management Photo Album of internal & external events Commission of corporate gifts Council, Exec & staff) Commission production of exhibition stands Corporate Video translations Commission Commission production of brochures Place Notices in electronic & print media Conduct regional Media Road shows Area age about Authority and the industry 7YVÄSL(\[OVYP[`»Z internal and external activities vourably before public & stakeholders vourably before public & stakeholders Authority’s mandate to Authority’s public and stakeholders Authority’s mandate Authority’s to public and stakeholders / Position the Authority favourably before public & stakeholders Communicate the regulatory Authority’s activities to public and stakeholders Communicate the regulatory Authority’s activities to public and stakeholders Strategic Goals Key Performance among the public and stakeholders about the Authority’s mandate holder access to information relating to the Authority’s regulatory activities KPI No. 2.7 Monitor media cover- 2.6 2.5 Position Authority fa- 2.4 Position Authority fa- 2.3 Communicate the 2.2 Communicate the 2.1 Brand & Promote awareness 1.7 Facilitate public and stake-

78 - 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY ICASA was represented in all compulsory international meetings of the ITU and UPU, as well PAPU. Eight (8) Internal ICASA events were hosted; Re- gional Long ServiceRegional and Head Awards, 6MÄJL:WVY[ZKH`Z*OHPYWLYZVU»Z-HYL^LSS3\UJO farewell lunch for three (3) Councillors, Women’s day, day event, Secretaries Wellness function. and End of Year Two editions of the Internal Newsletter produced Two and distributed. Intranet Site is still in development stage, and \WNYHKPUN[V[HRLWSHJLPU[OLUL^ÄUHUJPHS`LHY nal stakeholders successfully throughout the year. +HPS`LSLJ[YVUPJUL^ZÅHZOLZKPZ[YPI\[LK[VHSSPU[LY Internal meetings with employees were success- M\S[OYV\NOV\[[OL`LHY;OYLL/LHK6MÄJL :[HMM4LL[PUNZHUKLPNO[ 9LNPVUHS6MÄJL:[HMM Meetings ;OLZ[YH[LN`PZILPUNÄUHSPZLKMVYHWWYV]HSHUK implementation in 2011/12. Target ICASA represented at: 16 meetings / conferences including 6 ITU & UPU meetings Host 10 internal ICASA events Produce 4 editions of ICASA newsletter Publish 60 documents on Intranet Distribute iNews daily to Council, management & Staff /LHK6MÄJL Staff Meetings & 8 9LNPVUHS6MÄJL:[HMM Meetings per region Table Strategy Plan to Table Executive and Council for approval and implementation Unit of Measurement Representation at conferences, meetings and workshops events ICASA Newslet- ter ICASA Intranet content Daily electronic UL^ZÅHZOLZ Public Relations support Plan & Strategy (Output) Key Performance Indicator Representation in ITU & UPU conferences & meetings / workshops Host internal functions & events Internal ICASA Commission production of quarterly internal newsletter Publishing of an electronic inter- active site Compile & distribute daily elec- [YVUPJUL^ZÅHZO Arrange Staff meetings Staff meetings Implementation of Communica- tions & Stakeholder Strategy Crisis Communications Support Area Prepare a year schedule of meetings to attend; Prepare & manage budget; Prepare submissions for approval by Exco & Council through team-building functions & events isational activities, policies & events to staff isational activities, policies & events to staff isational activities, policies & events to staff Communicate organisational activities, policies to staff Advise & develop communications & external relations strategy for Council & Executive on Provision of public relations support to Authority Strategic Goals Key Performance tion in and compliance with international conventions informed about organisational policies & procedures and to enhance morale among the public and stakeholders about the Authority’s mandate KPI No. INTERNATIONAL RELATIONS INTERNATIONAL -\SÄSTHUKH[LHUKKLSP]LYZLY]PJLZLMMLJ[P]LS`HUKLMÄJPLU[S` 4.1 participa- Ensure Authority’s 3.5 Motivate employees 3.4 Communicate organ- 3.3 Communicate organ- 3.2 Communicate organ- 3.1 Ensure that employees are 2.8 Brand & Promote awareness

79 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY Six (6) reports issued on Monitoring & Compli- ance of the Registry Procedures Manual. Fourteen (14) Workshops/sessions were held Fourteen (14) Workshops/sessions ^P[OPUKP]PK\HSKLWHY[TLU[Z[VHTLUK[OLÄSLWSHU to ensure that all business functions are included PU[OLÄSLWSHU Acquired the following electronic databases: Tariff Acquired the following electronic databases: Tariff consultants; S.A. Institute of Race Relations; electronic journal of Facilities Management; Juta e Online; De Rebus, SA Attorneys’ Publications; Tax Journal. The library conducted the e-Resources training during the library week held during the Accessibility & availability of re- fourth quarter. sources subscribed to communicated via iNews. Subscriptions to all relevant organisations renewed. ICASA attended to six (6) bilateral requests for study visits. ICASA took part in all CRASA-SAPRA meetings, leading to the merger of two organisations. Target 4 Compliance Re- ports 4 workshops + amended FilePlan 4 additional databases Renew subscriptions to 4 relevant international organisations Facilitate 6 bilateral meetings where necessary Facilitate representa- tions to 6 CRASA & SAPRA meetings Unit of Measurement Report on compliance of RP manual File Plan workshop electronic databases acquired / subscribed to Subscriptions to relevant international organisations attendance Representation at conferences, meetings and workshops - (Output) Key Performance Indicator Monitor Registry Procedures Manual Compliance *SHZZPÄJH[PVUVMHSS0*(:(KVJ\ TLU[ZPUSPUL^P[OHWWYV]LKÄSL plan Electronic databases for divisions number of 9LUL^HSVMHMÄSPH[PVU[VYLSL]HU[ international organisations Bilateral study visits/MOU Bilateral meeting Coordinate regional cooperation & harmonisation of regulations standards Area of full function Registry in line with National Archives guidelines Plan implementation throughout ICASA Development of ICASA library into a virtual Library/Information Hub relations with other regulators Prepare a year schedule of meetings to attend; Prepare & manage budget; Prepare submissions for approval by Exco & Council Strategic Goals Key Performance Management (RM) has effective Knowledge Manage- ment System (KMS) other regulators KPI No. 1.3 Further development 1.2 Standardised File ADMINISTRATION and intelligence, governance Enhance business processes & reporting 1.1 Ensure ICASA Records 5.3 5.2 Facilitate bilateral 5.1 Promote Cooperation with

80 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY (ZZL[Z(SSVJH[PVU*YP[LYPHOHZILLUÄUHSPZLKI\[ not approved. No budget funding was available. The project is proceeding with the help of +LWHY[TLU[VM7\ISPJ>VYRZ[VÄUKZ\P[HISL/LHK 6MÄJLHJJVTTVKH[PVUH[HYLHZVUHISLYLU[HS cost. All leases effectively managed. client liaison meeting were attended as planned, and to all landlord queries as and when received. ICASA participated in and celebrated the S.A. National Library week. The unit benchmarked with local organization, and the Parliament of South i.e. the Rand Water Africa. The library hosted a delegate from the Authority and this was an op- Uganda Telecoms portunity to benchmark with UGANDA Telecoms Authority. Draft policy developed, but not yet approved. - Target location Criteria Approved Demand Plan Approve new Head 6MÄJL(JJVTTVKH tion Signed Lease Agree- ments for Regions Training on Electronic Training Resources during the week of S.A. National library week 1 Research Report on Benchmark Approved RM policy & divisional workshops - Unit of Measurement Finalized criteria Approved Assets Al- Supply Chain Demand Plan commodation Concluded Lease Agree- ment sources awareness workshops Report on visits taken Approved Re- cords Manage- ment Policy (Output) Key Performance Indicator (SSVJH[PVUJYP[LYPHÄUHSPaLK implemented 0KLU[PÄLKHZZL[ULLKZMVY5LLKZ Analysis report 3LHZLHNYLLTLU[ÄUHSPaLK 5L^VMÄJL(J 3LHZLHNYLLTLU[ZÄUHSPaLK 9LZLHYJOYLWVY[ÄUHSPaLK Records Management policy in place - - Area sets allocation criteria +L]LSVWHUVMÄJLHZ isation wide analysis for Assets requirements :WLJPÄJH[PVUVMVYNHU agement of new Lease agreement for Head 6MÄJL^P[O:3(Z Conclusion and management of new Lease agreements for 9LNPVUHS6MÄJLZ^P[O SLAs benchmarking against other Communication Regulatory bodies on Knowledge Manage- ment Systems (KMS) Development of Records Manage- ment functions in line with National Archives guidelines Strategic Goals Key Performance strategically positioned prop- LY[PLZMVY0*(:(VMÄJLZ Management (RM) has effective Knowledge Manage- ment System (KMS) KPI No. 3.2 3.1 Effective Asset management 2.2 Conclusion and man- -\SÄSTHUKH[LHUKKLSP]LYZLY]PJLZLMMLJ[P]LS`HUKLMÄJPLU[S` 2.1 Identify and secure the most 1.6 Library Week Electronic re- 1.5 Research international 1.4 Ensure ICASA Records

81 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY Vehicle Replacement Reports in place. Vehicle Existing Transport Policy being monitored and Existing Transport enforced, but revised policy not yet approved. nance. Disposal reports were completed for each quar- Departments of Health and Social Develop- ter. ment in Gauteng and Limpopo were engaged. Depart- Assets were donated to the North West ment of Health and Social Development. No budget funding was available. Target 4 Quarterly Reports Repairs & Maintenance Reports issued. Vehicle Implementation of an Approved Replace- ment Plan Revised Transport Revised Transport Policy Approved 4 Quarterly Reports Reports issued on Assets Repairs & Mainte- Reports Plan Unit of Measurement Quarterly Re- ports Approved Replace- Vehicle ment Plan ICASA Transport ICASA Transport Policy Quarterly Mainte- nance Reports Disposal Reports 4 Quarterly Disposal Acquisition Plan Annual Acquisition (Output) Key Performance Indicator Repairs and Maintenance reports in place Vehicle replacement plan in Vehicle place Approved Transport policy Approved Transport implemented Assets Repairs & Maintenance reports in place Approved Disposal Reports in place Approved Acquisition Plan in place - Area ,MÄJPLU[HUK,MMLJ tive management of vehicles during useful operating lifespan ,MÄJPLU[HUK,MMLJ[P]L planning and acquisition of vehicles in line with ICASA policies, SCM Management of YLSPHISLÅLL[[VM\SÄS[OL mandate of ICASA with Development and Implementation of Policy Transport ,MÄJPLU[HUKLMMLJ[P]L management of assets during useful operating life ,MÄJPLU[HUKLMMLJ[P]L disposal of assets in line with ICASA Policies, Supply Chain Management and National Treasury guidelines ,MÄJPLU[HUKLMMLJ[P]L planning and acquisition of assets in line with ICASA Policies, Supply Chain Manage- ment and National guidelines Treasury Strategic Goals Key Performance ful life of Fleet KPI No. 4.3 4.2 4.1 Improve management & use- 3.5 3.4 3.3 Effective Asset management

82 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY Security Committee appointed to assist and advise the Security Unit in their quest to reduce security breaches. Draft Security plan produced. 0U[LYUHSKPYLJ[VY`ÄUHSPaLK Reception manual drafted for approval. Draft Service Charter not yet approved. All four (4) reception areas staffed with re- ceptionists to deliver new service levels. All leasehold improvements were put on hold due [VWLUKPUNYLSVJH[PVUVMVMÄJLZ All queries logged on ICASA facilities email resolved. Service contracts being monitored and quarterly maintenance reports produced. 7YVQLJ[^HZKLMLYYLK[VUL_[ÄUHUJPHS`LHYK\L[V unavailability of funds. =LOPJSL+PZWVZHS9LWVY[ZÄUHSPaLK Target proved Security Plan Directory Implementation of Approved Reception Manual Implementation of the Approved Service Charter Improvement Plan for reception areas Facilities Helpdesk call centre 4 Quarterly Reports on Service contracts and maintenance reports Completed 4 Quarterly Reports Unit of Measurement Internal Directory Internal Information Manual vice Charter Plan Functional logging centre Quarterly Re- ports Quarterly Dis- posal Reports (Output) Key Performance Indicator Approved Security plan in place Security Plan Implementation of Ap- Internal information directory in place Reception manual in place Reception Service Charter in place Approved Ser- Improvement plans in place Improvement Central call logging centre in place Service contracts and maintenance reports in place Vehicles brandedVehicles vehicles Branded Phase 1 of Branding Approved disposal reports in place Area Improve contingency and emergency planning at all ICASA VMÄJLZ Admin staff to internally publicise ICASA projects and developments YP]HSZH[0*(:(VMÄJLZ awareness initiative improvement initiative and for Telephone Communication systems within ICASA service delivery in ICASA reception areas response and effective solutions to all requests for facility services or complaints Ensure proper mainte- UHUJLVMVMÄJLZLY]PJL facilities vehicles ,MÄJPLU[HUK,MMLJ[P]L disposal of vehicles in line with ICASA policies. Strategic Goals Key Performance Security Risk Management ZLY]PJLKLSP]LY`VM6MÄJL Facilities ful life of Fleet KPI No. 6.1 Improve administration of 5.6 initiative by Awareness 5.5 Start VIP & Visitor ar- 5.4 Start response time 5.3 Upgrade image and 5.2 Ensure prompt 5.1 Improve management and 4.5 Branding of ICASA 4.4 Improve management & use-

83 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY The bandwidth to the wide area network and the internet was upgraded from 2 MB to 4MB in quarter two, and monthly utilisation reports received from Vodacom. Project not implemented due to unavailability of funds. Services and processes are continuously being improved to ensure provision of prudent support services to other divisions. OHS Plan and procedures drafted but not yet approved. SHE committee in place. EXCO and managers on trained OHS legal compliance. SHE representatives on various OHS Trained courses and held SHE committee meetings. All incidents were investigated. Investigation report Z\ITP[[LK[V*,6»ZVMÄJL)LUJOTHYRL_LYJPZL helped the security unit to identify gaps and improvements. All planned assessments were conducted. Target Monthly WAN utilisa- Monthly WAN tion reports 3 TB SAN storage 3 switches Implementation of Ap- proved Procedures & Processes Approved OHS Plan & Procedures in place 1 Annual Benchmark- ing Report Monthly Reports All planned assessments were conducted. 2 Assessment Reports Unit of Measurement Reports * 12 4 Meg to internet Number 4 printers Approved Procedures & Processes ance Report Reports rity Reports Assessment Reports (Output) Key Performance Indicator Provide faster access to internet as well between the Regional VMÄJLZHUK/LHKVMÄJL storage and printers Control procedures and processes in place OHS plan & procedures in place OHS Compli- Reports in place Benchmarking Assessment reports in place Secu- Technical Assessment reports in place Bi-annual Area the internet and from YLNPVUHSVMÄJLZ[VOLHK VMÄJL Ensure effective Admin systems, business processes and controls are in place. Compliance to legislative requirements for Occupational Health & Safety standards marking of security procedures in line with legislation and best practices security assessments on equipment and procedures Conduct physical security assessment to identify and correct security risks Strategic Goals Key Performance sion of professional Adminis- tration Support Services ment of Occupational Health and Safety (OH&S) matters Security Risk Management KPI No. 1.2 Increase bandwidth to INFORMATION TECHNOLOGY INFORMATION -\SÄSTHUKH[LHUKKLSP]LYZLY]PJLZLMMLJ[P]LS`HUKLMÄJPLU[S` 1.1 Improve Customer Service Infrastructure upgrade acquisition of new switches, 8.1 Constantly improve the provi- 7.1 Improvement in manage- 6.4 Continuous bench- 6.3 Regular technical 6.2 Improve administration of

84 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY done on the JDE system and relevant training provided. system will be implemented The Licence Tracking PU[OLUL^ÄUHUJPHS`LHY plete and will go live in May 2011. 5VWYVNYLZZHZYLSVJH[PVUZ[PSS[VILÄUHSPZLK Incorporated external recruitment, and online “frequency application” functionality into the ICASA website. Intranet infrastructure completed for all divisions. Four (4) out of seven (7) applications have been developed and implemented, namely Inventory, Bids tracking, Postal and Permits. Selection of new ERP System implementation partner was put on hold due to budgetary constraints to procure the software licences and implementation of the system. Target Report on New infrastructure for head VMÄJLZ[HMM 2 Major Changes to Website Roll-out of an Intranet Portal to 8 Divisions 7 databases and Migration to Ms- SharePoint and SQL Platform mentation partner Unit of Measurement System System The development is eighty percent (80%) com- Report of requirements Control forms Functionality and Report Number of mod- ules cut over Report Report on ERP Imple- (Output) Key Performance Indicator Licensing database on JDE System System The contract management changes have been Numbering database on ICASA website Approved MSP Report Signed-off MSP The MSP has been approved. 5L^PUMYHZ[Y\J[\YLMVYOLHKVMÄJL staff Enhanced Website Signed Change to all ICASA departments and Regions Integration of databases and Migration to Ms-SharePoint and SQL Platform Selection of implementation partner Area licensing databases into JDE bering database Development of IT Master Systems Plan (MSP) for new site Special Project- Will add IT budget to consolidated “move” budget site Support and Enhance All-data applications Implementation of ERP (Phase 2): Compila- tion and submission of tender for the selection of implementation partner Strategic Goals Key Performance commenced in 2009-2010 (continued from 1) ERP Implementation) KPI No. 5.3 stand alone Transfer 5.2 Public access to num- 5.1 Completion of IT projects that 4.1 Site Relocations Provide infrastructure 3.3 Improve ICASA Web- 3.2 Intranet Roll-out of an Intranet Portal 3.1 Improve Customer Service 2.1 Systems Integration (New

85 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY Monthly reports produced and provided to the communications department on website utilisation. Four (4) Quarterly reports have been completed. Reports on telephone usage, summary and detailed have been provided monthly to the Administration division. Improved response times to close calls within :3(OV\YZMYVTZP_[`Ä]LWLYJLU[ [V eighty six percent (86%) over a 12 month period. The uptime on the servers and networks have stabilised and have been above ninety nine (99%) for the last two (2) quarters. Four (4) Quarterly meetings have taken place. The terms of the two (2) external members have been extended by another year. -V\YV\[VMÄ]L0;WVSPJPLZWSHUULKOH]L been reviewed. Recovery Plans have been developed, the YPZRZPKLU[PÄLK[OLYLPUULLK[VILHSPNULK[V[OL Risk Strategy and Registers. This Authority’s process will be concluded during quarter one of 2011/12. Target web usage per quarter usage reports 80% % calls resolved within SLA by year end work and applications ing the year Unit of Measurement No of reports 12 Monthly Telephone % calls resolved within SLA % uptime 97% uptime on net- No of meetings 4 ITRC Meetings dur- No of Policies 5 Policies Plan 2 Plans Whilst the Business Continuity and Disaster (Output) Key Performance Indicator Monthly reports on web usage Reports 12 Monthly reports on Timely and accurate reportingTimely Report 4 x PI Reports one Monthly Telephone usage Monthly Telephone reports sent to Admin Div. 80% of calls to help desk resolved within SLA Ensure uptime of at least 97% on network and servers Record of minutes maintained for audit purposes IT Policies reviewed every two years. Updated policies approved by Council IT Disaster Recovery (DR) and Business Continuity Plan (BCP) Area tistics Preparation of accurate Performance Informa- tion (PI) Reports for quarterly and annual reporting Regular and accurate reports on telephone usage and costs hardware and applications Uptime on network and applications Regular meetings held where IT strategy reviewed and agreed Urgent meetings held if and when required IT Policies reviewed annually Development of IT Disaster Recovery (DR) and Business Continu- ity Plan (BCP) Strategic Goals Key Performance mance reporting information Admin in place mittee (ITRC) in place and Procedures commenced in 2009-2010 KPI No. 6.7 Monitoring of website usage Review of web sta- 6.6 Accurate and reliable perfor- 6.5 Provide telephony reports to 6.4 Desktop Support on IT 6.3 An effective IT Infrastructure 6.2 An effective IT Review Com- 6.1 Review & Update IT Policies 5.4 Completion of IT projects that

86 - 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY The planning, acquisition and disposal systems have been implemented. Maintenance could not be implemented due to budgetary constraints. ;OLJVZ[PUNHUKWYVQLJ[JVZ[PUNZ`Z[LTJVUÄN\ ration was completed. Contract management for Accounts Receivable was completed, tested, commissioned and staff trained. A standard invoice and statement has been developed. The interface between JDE and Spectrum is 95% complete. Only one interface out of ten is outstanding. The resources that are responsible to develop the interface on Spectrum system side were reallocated to align the Spectrum Z`Z[LTZ»ZÄUHUJPHSWLYPVK^P[O[OL7-4(ÄUHUJPHS `LHY;OPZKLSH`LK[OLÄUHSPZH[PVUVM[OLPU[LYMHJL Due to the unavailability of funds, only critical infrastructure was purchased. 30 desktop computers were purchased for local election monitors and Finance temporary staff. Due to the unavailability of funds, only critical infrastructure was purchased. This included secondary 10TB storage to facilitate backups, new network switch and hub to cater for election monitors and additional temporary staff in Finance as well a new server for a tender management system. Target Develop integrated asset system and asset life cycle Develop Project Man- agement System and Costing System *VUÄN\YLJVU[YHJ[ management of Ac- counts Receivable (AR) Develop acceptable invoices and statement *VUÄN\YL7OHZLVM Revenue Module desktops 2 switches Unit of Measurement Asset system and asset life cycle module Project management, forecast- ing and costing module Contract management in AR General acceptable invoices and statement Revenue Module Number 4 laptops and 30 Number 3 TB SAN storage (Output) Key Performance Indicator *VUÄN\YLKPU[LNYH[LKHZZL[ system and asset life cycle *VUÄN\YLK7YVQLJ[4HUHNLTLU[ System and Costing *VUÄN\YLJVU[YHJ[THUHNLTLU[ of Accounts Receivable (AR) and statement as determined by operators *VUÄN\YLK9L]LU\L4VK\SL Laptops for mobile users and desktop for new users storage and printers - Area *VUÄN\YLPU[LNYH[LK asset system and asset life cycle *VUÄN\YL7YVQLJ[4HU agement System and Costing System management ÄUHUJPHSTVK\SLZ *VUÄN\YL7OHZLVM Revenue Module portability and PC’s for portability and PC’s additional staff Infrastructure upgrade Acquisition of new switches, Strategic Goals Key Performance Unbudgeted infrastructure upgrades KPI No. 1.5 1.4 1.3 Stabilisation of contract 1.2 Develop acceptable invoices FINANCE -\SÄSTHUKH[LHUKKLSP]LYZLY]PJLZLMMLJ[P]LS`HUKLMÄJPLU[S` 1.1 Improve Financial Systems Stabilisation of all 6.9 Provide greater 6.8 Adhoc / Emergency

87 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY ;OLJVSSLJ[PVUYH[LPZÄM[`Ä]LWLYJLU[ HUKPZ under the target by thirty percent (30%).The bulk billing was run late December 2010 and January ILJH\ZLVM[OLJOHUNLPU[OLÄUHUJPHS`LHY in the Spectrum system, invoices were therefore distributed late. Our FMPI were improved for monthly accounts for and ENE. Installed mapped CaseWare ÄUHUJPHSZ[H[LTLU[Z^VYRZJOLK\SLHUK^VYRPUN papers. Tender reporting was improved and submitted Tender on quarterly basis to Executive Management and It was also automated. Treasury. Monthly costing reporting improved. Reviewed for residual values and life span were completed in March 2011. ;^VX\HY[LYS`HUK`LHYLUK]LYPÄJH[PVUZ^LYL JVUK\J[LKPU[OLOLHKVMÄJLHUKYLNPVUZ;OL LSLJ[YVUPJHZZL[JVUÄYTH[PVUOHZILLUKL]LSVWLK which will improve internal controls on assets ]LYPÄJH[PVU The following policies have either been developed Petty Cash, SCM, Adminis- or updated: S & T, tered Revenue and Investment but have not yet been approved. The business processes were enhanced namely: 30 days payment, bid processes, contract management, refunds, commitments, accruals, HSSVJH[PVUVMYLJLPW[ZHUKHZZL[JVUÄYTH[PVU - Target Annual collection rate of 85% Report on FMPI compliance Improved tender reports Enhance budget, revenue and costing reports Report on asset residual values. (ZZL[]LYPÄJH[PVU report

88 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY The Authority paid forty four percent (44%) of SMME within fourteen (14) days. A tracking system has been implemented to improve this. Thirty three percent (33%) was procured from SMME’S and this target was exceeded by eighteen percent (18%). For goods and services above R500K, sixty seven percent (67%) was procured from HDI companies. This is higher than the target by were given twenty seven percent (27%). BEE’s more opportunities through the rotation system. -VYNVVKZHUKZLY]PJLZILSV^92ÄM[`MV\Y The percent (54%) was procured from HDI’s. achievement was 1% less than target because the highly specialized goods and services are still provided by non HDI. Partnerships with BEE companies is encouraged if the company does not have satisfactory HDI status. Collected one hundred percent (100%) from SAPO and couriers who have renewed. The courier operators that did not renew are being followed up by the Compliance Department. Collected sixty one percent (61%) from custom- LYZ[OH[Z\ITP[[LK[OLPYÄUHUJPHSZ[H[LTLU[Z;OL under collection is due to the interpretation of General Licence Fees Regulations. There is seventy four percent (74%) collec- [PVUMYVTIYVHKJHZ[LYZ[OH[Z\ITP[[LKÄUHUJPHS statements. Community broadcasters have not Z\ITP[[LK[OLPYÄUHUJPHSUVYWHPKJSHPTPUN[OH[[OL` The Authority is enag- cannot afford to pay USF. ing them to resolve this. Target Improve sustainability of SMME Target HDI in most of Target procurement tenders procurement tenders procurement tenders Annual collection rate of 98%. Annual collection rate of 85%. Annual collection rate of 95%. Unit of Measurement payment Report on SMME procurement HDI report HDI in most of Target HDI report HDI in most of Target Revenue collection report Revenue collection report Revenue collection report (Output) Key Performance Indicator Improve sustainability of SMME Report of SMME Target HDI in most of procure- Target ment tenders Target HDI in most of procure- Target ment tenders Target HDI in most of procure- Target ment tenders Postal Services: Annual collection rate of 98%. ECN & ECS: Annual collection rate of 85%. Broadcasting: Annual collection rate of 95%. Area days from SMMEs on goods and services below R500k from HDI on goods and services above R500k Procure at least 55% from HDI on goods and services below R500k amounts amounts amounts Strategic Goals Key Performance on ICASA procurement KPI No. 5.4 Pay SMME within 14 5.3 Procure at least 15% 5.2 Procure at least 40% 5.1 Increase participation of HDI 4.4 Collect the payable 4.3 Collect the payable 4.2 Improve Revenue Collection Collect the payable

89 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY report completed. General management letter issues. (84%) internal audit reports were issued. Payment to large companies processed within thirty (30) days was seventy four percent (74%) which is lower than target. Eleven (11%) were late payments due to account queries. A tracking system has been implemented to improve payment period. Target 2 In-house training provided in addition to the one 1 (2) reports were issued in respect of Auditor Two 25 A total of twenty one (21), eighty four percent Improve supplier relationships Unit of Measurement Training ReportTraining 1 Only in-house soft skills training attended. Report Report Report completed analysis (Output) Key Performance Indicator Training report including the Training number trained Internal quality assurance report QA Report 2 No internal assessments conducted. Internal audit reports Internal Audit Internal audit reports Internal Audit Internal audit reports completed as per the detailed operational Plan Improve supplier relationships Report of age Area CPD Training as per CPD Training Individual Development Plan (IDP) (Technical, skills) soft and CAATs Internal assessments are conducted annually Mate and ACL Auditor General management letter issues Internal audit reports on the adequacy and effectiveness of internal controls, risk management and governance processes. Pay large organisations within 30 Strategic Goals Key Performance of Internal Auditors (IIA) Standards internal control, risk management and governance processes for adequacy and effectiveness on ICASA procurement KPI No. 2.2 Internal Audit Staff - 2.1 Compliance with the Institute 1.3 Effective use of Team- 1.2 Follow - up reports on COMPLIANCE, RISK AND AUDIT INTERNAL AUDIT and intelligence, governance Enhance business processes & reporting 1.1 Appraise the systems of 5.5 Increase participation of HDI

90 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY Governance during the fourth quarter. Governance during the fourth quarter. formance Information presented by the AG at ICASA. regular feedback to Council on issues raised at ARC meetings. a technical subcommittee was established to assess matters relating to the year end audit. Ad hoc meetings were also held. the systems of Internal control, Risk and Gover- nance processes. Target Unit of Measurement Report 4 Internal Audit commenced an audit on Corporate Training providedTraining 2 training sessions ARC members attended a workshop on Per- Report 4 The ARC Chairperson and members provided Number 4 In addition to the formal ARC meetings held, Annual Report 1 No annual report issued on the assessment of Annual Report 1 No training was provided to Councillors. Quarterly Report 4 (2) quarterly reports tabled at ARC. Two Quarterly Report 4 (2) quarterly reports tabled at Exco. Two (Output) Key Performance Indicator Audit report on functioning of corporate governance structures Training report including the Training number trained Report back to Council and EXCO on issues raised at Audit and Risk Committee meetings held At least Four mandatory Audit and Risk committee meetings to be held during the year Overall report on the assessment of the systems internal control, risk and Governance processes Annual report on training provided Review of activities report on work done by Internal Audit (IA) Executive summary report of THQVYÄUKPUNZVU^VYRKVULI` Internal Audit (IA) Area Audit report on reviews of compliance to corporate governance processes of the AC members Regular reporting to Council/Executive by the AC Quarterly meetings of the Audit and Risk Committee EXCO and Council by the Chief Audit Execu- tive (CAE) members on IA and AC operations Audit Committee (AC) by the Chief Audit Executive (CAE) EXCO and Council by the Chief Audit Execu- tive (CAE) Strategic Goals Key Performance structures are working as intended is in place mittee (ARC) Services KPI No. 3.1 Corporate Governance 2.2 There is regular training 2.1 An effective Audit Committee COMPLIANCE AND RISK and intelligence, governance Enhance business processes & reporting 1.1 Provide Audit and Risk Com- 3.4 Annual reporting to 3.3 of Council Training 3.2 Quarterly reporting to 3.1 Governance reporting Quarterly reporting to

91 - - - - 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY cies and procedures including the introduction of a policy template and approval process which Council approved during the fourth quarter. The full review of all policies will commence in the ÄYZ[X\HY[LYVM[OLUL^ÄUHUJPHS`LHY *YP[PJHSYPZRZPKLU[PÄLKK\YPUN[OL`LHY^LYLPUKP vidually highlighted at EXCO meetings. *YP[PJHSYPZRZPKLU[PÄLKK\YPUN[OL`LHY^LYLPUKP vidually highlighted at ARC meetings. sions explaining the requirements to update their YPZRWYVÄSLZHUK[VYL]PL^[OLWYL]PV\ZYPZRYLNPZ this process had to be aligned ters. However, the new corporate strategy and could therefore not be completed before the year end. strategy during the fourth quarter with Authority’s strategy during the fourth quarter with Authority’s Z[YH[LNPJYPZRZ^LYLHSZVPKLU[PÄLKK\YPUN[OPZWYV the coherent risk management cess. However, risk management policy framework and strategy, fraud and corruption policy the strategic risk TP[PNH[PVUWSHUZJV\SKUV[ILÄUHSPZLKILMVYL[OL ÄUHUJPHS`LHYLUKLK Target CIL - 4 Unit of Measurement Workshops 4 Intranet 12 Policies 48 The Authority embarked on a revision of all poli- Report EXCO - 12 COUN- Report 4 Register 3 Workshops 12 Meetings were held with management of all divi- Plan 4 Council approved a new three year corporate (Output) Key Performance Indicator 8\HY[LYS`IYPLÄUN[V,TWSV`LLZ on Polices and Procedures in conjunction with HR Policies and Procedures communicated monthly to Employ- ees New Policies and Procedures drafted and existing Policies Procedures annually reviewed and updated. All Policies Procedures approved by Council. *V\UJPSVU9PZRZPKLU[PÄLKHUK progress made Risk Committee on Risks identi- ÄLKHUKWYVNYLZZTHKL proved by Council Departmental Risk Assessments conducted Workshops Risk Management Strategy developed and approved by Council Area Policies and Proce- dures reviewed on an annual basis and in place A risk management strategy is in place and is being implemented Strategic Goals Key Performance and procedures ment within the Authority KPI No. 5.3 5.2 New and Reviewed Approved 5.1 Update of ICASA policies 4.5 Report provided to EXCO and 4.4 Report provided to Audit and 4.3 Risk Register compiled and ap- 4.2 Risk Register Compiled 4.1 Co-ordinate risk manage-

92 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY strategy during the fourth quarter and Author- P[`»ZZ[YH[LNPJYPZRZ^LYLHSZVPKLU[PÄLKK\YPUN[OPZ the coherent risk manage- process. However, risk management policy framework ment strategy, and fraud corruption policy the strategic YPZRTP[PNH[PVUWSHUZJV\SKUV[ILÄUHSPZLKILMVYL [OLÄUHUJPHS`LHYLUKLK to Performance Information was not timeously submitted to stakeholders for quarters one, three A Compliance and Risk report was and four. issued on the budgeting process. proved during the fourth quarter. submitted to stakeholders for quarters one, three and four. on the performance information requirements and workshops were held with Council Management in this regard as the AG reported that deliverables for 2010/11 could still not be adequately measured. Quarterly performance information was not prepared timeously during the year under review. cies and procedures including the introduction of a policy template and approval process which Council approved during the fourth quarter. The full review of all policies will commence in the ÄYZ[X\HY[LYVM[OLUL^ÄUHUJPHS`LHY Target Workshops - 4, Workshops Newsletters - 4, Intranet - 12 Unit of Measurement Workshops, Workshops, Newsletters, Intranet Plan 3 Council approved a new three year corporate Checklist 12 Budgeting, Monthly Financial Reporting in addition Policy 1 The Performance Information Policy was ap- Checklist 12 Performance Information was not timeously Report 4 A process was undertaken to engage the AG Report 4 The Authority embarked on a revision of all poli- (Output) Key Performance Indicator through workshops, intranet, ethics up- ICASA newsletter, dates Implementation of the Fraud Prevention Plan Timely and Accurate Budget/ Timely Finance reporting Performance Information Policy and Guidelines developed approved by Council Performance Information Pro- vided to stakeholders as per their requirements P Quarterly Performance Informa- tion prepared in accordance with AG requirements tabled at EXCO, Council and Audit Risk Committee Quarterly report to EXCO, Coun- cil and Audit Risk Commit- tee on policies and procedures approved and communicated to all Employees Area A Fraud Prevention Plan (FPP) is in place and is being implemented Financial Reporting process in line with stakeholders requirements mation Policy and Guidelines Compiled and in place tion provided timeously to all stakeholders Assessment and Review of Performance Information in line with AG requirements Policies and Proce- dures reviewed on an annual basis Strategic Goals Key Performance detection and investigative strategies mance Reporting Information, including Budgeting, Financial and Operational Performance Information and procedures KPI No. 7.2 Anti-fraud awareness campaign 7.1 Co-ordinate fraud prevention, 6.4 Budgeting, Monthly 6.3 Performance Infor- 6.2 Performance Informa- 6.1 Accurate and Reliable Perfor- 5.4 Update of ICASA policies

93 6]LYHSSWYVNYLZZK\YPUN[OLÄUHUJPHS`LHY the year. However, a status report was compiled However, the year. on a fraud matter concluded internally during the ÄUHUJPHS`LHY;OL[YPHSYLNHYKPUN[OLJYPTPUHS charges instituted will only commence after this ÄUHUJPHS`LHY;OL:(7:PZILPUNJVU[PU\HSS` engaged in this matter. Target Unit of Measurement Report 4 No forensic investigations were undertaken during (Output) Key Performance Indicator Ad hoc reports on forensic investigations undertaken Area A Fraud Prevention Plan (FPP) is in place and is being implemented Strategic Goals Key Performance detection and investigative strategies KPI No. 7.3 Co-ordinate fraud prevention,

94 95

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA 9. ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2011 CONTENTS

Statement of responsibility 97 Report of the Audit and Risk Committee 98 Report of the Auditor-General 100 9LWVY[I`[OL(JJV\U[PUN6MÄJLY Statement of Financial Performance 108 Statement of Financial Position 109 Statement of Changes in Net Assets 110 Cash Flow Statement 111 Statement of Comparison of Budget and Actual Amounts 112 5V[LZ[V[OLÄUHUJPHSZ[H[LTLU[Z

96 97

STATEMENT OF RESPONSIBILITY

;OL*V\UJPSPZYLZWVUZPISLMVY[OLV]LYZPNO[YVSLVU[OLÄUHUJPHSZ[H[LTLU[ZHUK[OL*OPLM,_LJ\[P]L6MÄJLYPUOPZJHWHJP[`HZ (JJV\U[PUN6MÄJLYPZYLZWVUZPISLMVY[OLWYLWHYH[PVUHUKPU[LNYP[`VM[OLÄUHUJPHSZ[H[LTLU[ZHUKYLSH[LKPUMVYTH[PVUPUJS\KLKPU[OPZ YLWVY[0UVYKLYMVY[OL(JJV\U[PUN6MÄJLY[VKPZJOHYNLOPZYLZWVUZPIPSP[PLZTHUHNLTLU[OHZKL]LSVWLKHUKJVU[PU\LZ[VTHPU[HPU a system of internal control. The system of internal controls of ICASA is monitored primarily through Internal Audit and Compliance and Risk and is reviewed by the Audit and Risk Committee.

The internal controls include a risk based system of internal controls and administrative controls designed to provide reasonable, but not absolute, assurance that assets are safeguarded and that transactions are executed and recorded in accordance with generally accepted business practices and the entity’s policies and procedures. Trained, skilled personnel with an appropriate segregation of duties implement these controls. They are monitored by management and include a comprehensive budgeting and reporting system operating within strict deadlines and an appropriate control framework.

;VYL]PL^[OLZ`Z[LTVMPU[LYUHSJVU[YVSHUPU[LYUHSH\KP[M\UJ[PVUOHZILLUZL[\W[OH[JVUK\J[ZVWLYH[PVUHSÄUHUJPHSHUKZWLJPÄJ H\KP[ZHUKJVVYKPUH[LZH\KP[JV]LYHNL^P[O[OL(\KP[VY.LULYHS;OL(\KP[VY.LULYHSPZYLZWVUZPISLMVYYLWVY[PUNVU[OLÄUHUJPHS statements.

;OL ÄUHUJPHS Z[H[LTLU[Z OH]L ILLU WYLWHYLK PU HJJVYKHUJL ^P[O [OLLMMLJ[P]L:[HUKHYKZVM.LULYHSS`9LJVNUPZLK(JJV\U[PUN 7YHJ[PJL.9(7PZZ\LKI`[OL(JJV\U[PUN:[HUKHYKZ)VHYK;OLÄUHUJPHSZ[H[LTLU[ZHYLIHZLKVUHWWYVWYPH[LHJJV\U[PUNWVSPJPLZ consistently applied and supported by reasonable and prudent judgements and estimates. Council believes that the entity will ILHNVPUNJVUJLYUPU[OL`LHYHOLHK-VY[OPZYLHZVU[OL`JVU[PU\L[VHKVW[[OLNVPUNJVUJLYUIHZPZPUWYLWHYPUN[OLÄUHUJPHS statements.

;OLÄUHUJPHSZ[H[LTLU[ZMVY[OL`LHYLUKLK4HYJOHZZL[V\[VUWHNLZ [VOH]LILLUHWWYV]LKI`*V\UJPSHUKHYL signed on its behalf by:

+Y:[LWOLU4UJ\IL ;OLTIH+SHTPUP *OHPYTHU *OPLM,_LJ\[P]L6MÄJLY 1\S` 1\S` REPORT OF THE AUDIT AND RISK COMMITTEE for the year ended 31 March 2011

INTRODUCTION

;OL(\KP[HUK9PZR*VTTP[[LLOHZWSLHZ\YLPUWYLZLU[PUN[V7HYSPHTLU[P[ZYLWVY[MVY[OLÄUHUJPHS`LHYLUKLK4HYJO as required by the Treasury Regulations issued in terms of the Public Finance Management Act, Act 1 of 1999 ( as amended ) (PFMA).

AUDIT AND RISK COMMITTEE MEMBERS

;OL(\KP[HUK9PZR*VTTP[[LLOHKTLL[PUNZPUHJJVYKHUJL^P[OP[Z*OHY[LYHZWLY[OL[HISLYLÅLJ[LKVUWHNLVM[OL(UU\HS Financial Statements, since its 2010 report (dated: 31 July 2010). The membership of the Audit and Risk Committee is as follows:

Sandile Swana Chairperson – re-appointed 1 January 2010 Rene Kenosi Member – re-appointed 1 January 2010 Tsediso Gcabashe Member – re-appointed 1 May 2010 Tsheko Ratsheko Member – appointed 1 February 2010 Thandi Sihlaba Member – appointed 1 July 2010

AUDIT AND RISK COMMITTEE RESPONSIBILITY

The Audit and Risk Committee has:

complied with its responsibilities and obligations as set out in section 38(1)(a) of the PFMA and Treasury Regulation 3.1.13; and complied with and discharged all its responsibilities according to the Audit and Risk Committee Charter, which regulates its formal terms of reference .

THE EFFECTIVENESS OF INTERNAL CONTROL

In its 2010 report the Audit and Risk Committee noted, amongst others, the need for improvement in internal controls as well as compliance with prescribed policies and procedures and regulations.

The Annual Financial Statements for the year ending 31 March 2011 have been audited by the Auditor General, who has issued a X\HSPÄLKVWPUPVU;OL(\KP[HUK9PZR*VTTP[[LLJVUJ\YZ^P[O[OL(\KP[VY.LULYHSPU[OPZYLNHYK

98 99

The chairperson of the Audit and Risk Committee continues to address the Council of ICASA on the above as a basis for setting up a platform for excellence in governance and internal control going forward.

;OL(\KP[HUK9PZR*VTTP[[LLOHZILLUTHKLH^HYLI`[OLUL^S`HWWVPU[LK*OPLM,_LJ\[P]L6MÄJLYVM[OLPTWSLTLU[H[PVUVM JVYYLJ[P]LHJ[PVUZ[OH[OH]LHSYLHK`JVTTLUJLK[VHKKYLZZ[OLPZZ\LZPKLU[PÄLKPU[OLH\KP[VWPUPVU

EVALUATION OF THE FINANCIAL STATEMENTS

The Audit and Risk Committee has reviewed:

[OLH\KP[LK(UU\HS-PUHUJPHS:[H[LTLU[ZHUKKPZJ\ZZLK[OLT^P[O[OL(\KP[VY.LULYHSHUK[OL*OPLM,_LJ\[P]L6MÄJLYPU OPZJHWHJP[`HZHJJV\U[PUNVMÄJLY" the Auditor-General’s management letter and related management responses; and the accounting policies and practices.

(U\TILYVMHKQ\Z[TLU[ZYLZ\S[PUNMYVT[OLH\KP[OH]LILLUNP]LULMMLJ[PU[OLHUU\HSÄUHUJPHSZ[H[LTLU[ZYLJVNUPZPUNWYL]PV\Z LYYVYZ;OL(\KP[HUK9PZR*VTTP[[LLPZZH[PZÄLK[OH[[OL(UU\HS-PUHUJPHS:[H[LTLU[ZJVTWS`PUHSSTH[LYPHSYLZWLJ[Z^P[O[OL requirements of the PMFA (as amended).

;OL(\KP[HUK9PZR*VTTP[[LLJVUJ\YZHUKHJJLW[Z[OLJVUJS\ZPVUVM[OL(\KP[VY.LULYHSVU[OLHUU\HSÄUHUJPHSZ[H[LTLU[ZHUK PZVM[OLVWPUPVU[OH[[OLH\KP[LKHUU\HSÄUHUJPHSZ[H[LTLU[ZILHJJLW[LKHUKYLHK[VNL[OLY^P[O[OLYLWVY[VM[OL(\KP[VY.LULYHS

:HUKPSL:^HUH *OHPYWLYZVU (\KP[HUK9PZR*VTTP[[LL 1\S` REPORT OF THE AUDITOR-GENERAL

REPORT OF THE AUDITOR-GENERAL TO PARLIAMENT ON THE INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA

REPORT ON THE FINANCIAL STATEMENTS

0U[YVK\J[PVU

0OH]LH\KP[LK[OLHJJVTWHU`PUNÄUHUJPHSZ[H[LTLU[ZVM[OL0UKLWLUKLU[*VTT\UPJH[PVUZ(\[OVYP[`VM:V\[O(MYPJH0*(:(^OPJO JVTWYPZL[OLZ[H[LTLU[VMÄUHUJPHSWLYMVYTHUJLHZH[4HYJO[OLZ[H[LTLU[VMÄUHUJPHSWVZP[PVUZ[H[LTLU[VMJOHUNLZ PULX\P[`HUKZ[H[LTLU[VMJHZOÅV^ZMVY[OL`LHY[OLULUKLKHZ\TTHY`VMZPNUPÄJHU[HJJV\U[PUNWVSPJPLZHUKV[OLYL_WSHUH[VY` information, set out on pages 108 to 171.

(JJV\U[PUNVMÄJLY»ZYLZWVUZPIPSP[`MVY[OLÄUHUJPHSZ[H[LTLU[Z

;OLHJJV\U[PUNVMÄJLYPZYLZWVUZPISLMVY[OLWYLWHYH[PVUHUKMHPYWYLZLU[H[PVUVM[OLZLÄUHUJPHSZ[H[LTLU[ZPUHJJVYKHUJL^P[O[OL South African Standards of Generally Recognised Accounting Practices (SA Standards of GRAP) and the requirements of the Public Finance Management Act of South Africa, 1999 (Act No.1 of 1999) (PFMA), and for such internal control as management determines ULJLZZHY`[VLUHISL[OLWYLWHYH[PVUVMÄUHUJPHSZ[H[LTLU[Z[OH[HYLMYLLMYVTTH[LYPHSTPZZ[H[LTLU[^OL[OLYK\L[VMYH\KVYLYYVY

(\KP[VY.LULYHS»ZYLZWVUZPIPSP[`

As required by section 188 of the Constitution of the Republic of South Africa, 1996 (Act No. 108 of 1996) and section 4 of the Public (\KP[(J[VM:V\[O(MYPJH(J[5VVM7((T`YLZWVUZPIPSP[`PZ[VL_WYLZZHUVWPUPVUVU[OLZLÄUHUJPHSZ[H[LTLU[Z based on my audit.

I conducted my audit in accordance with International Standards on Auditing and General Notice 1111 of 2010 issued in Government Gazette 33872 of 15 December 2010. Those standards require that I comply with ethical requirements and plan and perform the H\KP[[VVI[HPUYLHZVUHISLHZZ\YHUJLHIV\[^OL[OLY[OLÄUHUJPHSZ[H[LTLU[ZHYLMYLLMYVTTH[LYPHSTPZZ[H[LTLU[

(UH\KP[PU]VS]LZWLYMVYTPUNWYVJLK\YLZ[VVI[HPUH\KP[L]PKLUJLHIV\[[OLHTV\U[ZHUKKPZJSVZ\YLZPU[OLÄUHUJPHSZ[H[LTLU[Z The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the ÄUHUJPHSZ[H[LTLU[Z^OL[OLYK\L[VMYH\KVYLYYVY0UTHRPUN[OVZLYPZRHZZLZZTLU[Z[OLH\KP[VYJVUZPKLYZPU[LYUHSJVU[YVSYLSL]HU[ [V[OLLU[P[`»ZWYLWHYH[PVUHUKMHPYWYLZLU[H[PVUVM[OLÄUHUJPHSZ[H[LTLU[ZPUVYKLY[VKLZPNUH\KP[WYVJLK\YLZ[OH[HYLHWWYVWYPH[L 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 THUHNLTLU[HZ^LSSHZL]HS\H[PUN[OLV]LYHSSWYLZLU[H[PVUVM[OLÄUHUJPHSZ[H[LTLU[Z

100 101

0ILSPL]L[OH[[OLH\KP[L]PKLUJL0OH]LVI[HPULKPZZ\MÄJPLU[HUKHWWYVWYPH[L[VWYV]PKLHIHZPZMVYT`X\HSPÄLKH\KP[VWPUPVU

)HZPZMVYX\HSPÄLKVWPUPVU

5H[PVUHS9L]LU\L-\UKHKTPUPZ[LYLKHZZL[ZHUK5H[PVUHS9L]LU\L-\UKWH`HISLZ

ICASA collects licence fees as contemplated by the Electronic Communications Act (ECA). In terms of section 15(3) of the Independent Communications Authority of South Africa Act, 2000 (Act No. 13 of 2000), the authority is required to pay all fees received and held on their behalf to the National Revenue Fund (NRF) within 30 days after receipt of such revenue.

I was unable to verify the National Revenue Fund administered assets and resulting National Revenue Fund payables balances HTV\U[PUN[V9 HUK9 YLZWLJ[P]LS`HZKPZJSVZLKPUUV[LZHUK [V[OLÄUHUJPHSZ[H[LTLU[ZK\L[V lack of control over the invoicing and collection of licence fees. The entity’s records did not permit the application of alternative audit WYVJLK\YLZYLNHYKPUN[OLHTV\U[YLJLP]HISLHUKYLZ\S[PUNWH`HISL*VUZLX\LU[S`0^HZ\UHISL[VVI[HPUZ\MÄJPLU[HWWYVWYPH[LH\KP[ evidence to satisfy myself as to the existence, completeness, valuation and allocation of and rights and obligations pertaining to the National Revenue Fund administered assets and resulting National Revenue Fund payables.

(ZHYLZ\S[VM[OLHIV]L0HTHSZV\UHISL[VJVUJS\KLVU[OL]HS\H[PVUJVTWSL[LULZZJSHZZPÄJH[PVUHUK\UKLYZ[HUKHIPSP[`VMHUK YPNO[ZHUKVISPNH[PVUZWLY[HPUPUN[V[OLÄUHUJPHSPUZ[Y\TLU[KPZJSVZ\YLTHKLPUUV[L[V[OLÄUHUJPHSZ[H[LTLU[Z

7YVWLY[`WSHU[HUKLX\PWTLU[HUK0U[HUNPISLHZZL[Z

Standard of Generally Recognised Accounting Practices, GRAP 3, Accounting policies, changes in accounting estimates and errors requires that the entity correct material prior period errors retrospectively. If the error occurred before the earliest period presented, the restatement has to be made against the earliest prior period presented, which in the entity’s case is 1 April 2009.

The entity used the incorrect method of calculating their depreciation and amortisation when a change in estimate occurred in the WYPVY`LHYZ;OPZLYYVYOHZILLUJVYYLJ[LKHUKKPZJSVZLKPUUV[L[V[OLÄUHUJPHSZ[H[LTLU[Z/V^L]LYTHUHNLTLU[KPKUV[HKQ\Z[ the opening balance of property, plant and equipment and intangible assets as at 1 April 2009 to comply with GRAP 3. There were no satisfactory alternative audit procedures that I could perform to obtain reasonable assurance that the opening balances as at 1 April 2009 are fairly stated.

As a consequence of my inability to satisfy myself as to the valuation of the opening balance of property, plant and equipment and intangible assets as at 1 April 2009, I was not able to satisfy myself as to the accuracy, occurrence and completeness of the KLWYLJPH[PVUHUKHTVY[PZH[PVUHZKPZJSVZLKPU[OLZ[H[LTLU[VMÄUHUJPHSWLYMVYTHUJLMVY[OLJ\YYLU[HUKJVTWHYH[P]L`LHY

*VUZLX\LU[S`0KPKUV[VI[HPUZ\MÄJPLU[HWWYVWYPH[LH\KP[L]PKLUJL[VZH[PZM`T`ZLSMHZ[V[OL]HS\H[PVUVM[OLWYVWLY[`WSHU[HUK LX\PWTLU[IHSHUJLHUKPU[HUNPISLHZZL[ZHZKPZJSVZLKPUUV[LZHUK[V[OLÄUHUJPHSZ[H[LTLU[Z

As a result of the above, I am also unable to conclude on the completeness, accuracy and occurrence of the WYPVYWLYPVKLYYVY and JOHUNLPULZ[PTH[LKPZJSVZLKPUUV[LZHUK[V[OLÄUHUJPHSZ[H[LTLU[Z 8\HSPÄLKVWPUPVU

0UT`VWPUPVUL_JLW[MVY[OLWVZZPISLLMMLJ[ZVM[OLTH[[LYZKLZJYPILKPU[OL)HZPZMVYX\HSPÄLKVWPUPVUWHYHNYHWOZ[OLÄUHUJPHS Z[H[LTLU[ZWYLZLU[MHPYS`PUHSSTH[LYPHSYLZWLJ[Z[OLÄUHUJPHSWVZP[PVUVM0*(:(HZH[4HYJOHUKP[ZÄUHUJPHSWLYMVYTHUJL HUKJHZOÅV^ZMVY[OL`LHY[OLULUKLKPUHJJVYKHUJL^P[O:V\[O(MYPJHU:[HUKHYKZVM.LULYHSS`9LJVNUPZLK(JJV\U[PUN7YHJ[PJLZ (SA Standards of GRAP) and the requirements of the Public Finance Management Act of South Africa (PFMA).

,TWOHZPZVMTH[[LYZ

0KYH^H[[LU[PVU[V[OLTH[[LYZILSV^4`VWPUPVUPZUV[TVKPÄLKPUYLZWLJ[VM[OLZLTH[[LYZ

0YYLN\SHYHUKMY\P[SLZZHUK^HZ[LM\SL_WLUKP[\YL

0YYLN\SHYL_WLUKP[\YL

(ZKPZJSVZLKPUKPZJSVZ\YLUV[L[V[OLÄUHUJPHSZ[H[LTLU[ZPYYLN\SHYL_WLUKP[\YL[V[OLHTV\U[VM9!9 was incurred because proper procurement procedures were not followed.

-Y\P[SLZZHUK^HZ[LM\SL_WLUKP[\YL

;OLLU[P[`PUJ\YYLKMY\P[SLZZHUK^HZ[LM\SL_WLUKP[\YLVM9YLSH[PUN[V[OLJ\YYLU[ÄUHUJPHS`LHY

:PNUPÄJHU[\UJLY[HPU[PLZ

>P[OYLMLYLUJL[VUV[L[V[OLÄUHUJPHSZ[H[LTLU[Z0*(:(PZ[OLKLMLUKHU[PUHU\TILYVMSH^Z\P[Z;OL\S[PTH[LV\[JVTLVM[OLZL TH[[LYZJHUUV[J\YYLU[S`ILKL[LYTPULKHUKUVWYV]PZPVUMVYHU`SPHIPSP[`[OH[TH`YLZ\S[OHZILLUTHKLPU[OLÄUHUJPHSZ[H[LTLU[Z

9LZ[H[LTLU[VMJVYYLZWVUKPUNÄN\YLZ

(ZKPZJSVZLKPUUV[L[V[OLÄUHUJPHSZ[H[LTLU[Z[OLJVYYLZWVUKPUNÄN\YLZMVY[OL`LHYLUKLK4HYJOOH]LILLUYLZ[H[LK HZHYLZ\S[VMLYYVYZKPZJV]LYLKK\YPUN[OL`LHYLUKLK4HYJOPU[OLÄUHUJPHSZ[H[LTLU[ZVM0*(:(H[HUKMVY[OL`LHYLUKLK 31 March 2010.

9,769;656;/,93,.(3(5+9,.<3(;69@9,8<09,4,5;:

In accordance with the PAA and in terms of General notice 1111 of 2010, issued in Government Gazette 33872 of 15 December 2010, 0PUJS\KLILSV^T`ÄUKPUNZVU[OLHUU\HSWLYMVYTHUJLYLWVY[HZZL[V\[VUWHNLZ[V HUKTH[LYPHSUVUJVTWSPHUJL^P[OSH^Z and regulations applicable to the department.

102 103

9LWVY[VUWYLKL[LYTPULKVIQLJ[P]LZ

;OLYLWVY[LKWLYMVYTHUJLPUMVYTH[PVU^HZKLÄJPLU[PUYLZWLJ[VM[OLMVSSV^PUNJYP[LYPH! 4LHZ\YHIPSP[`!;OLPUKPJH[VYZHYLUV[^LSSKLÄULKHUK[OL[HYNL[ZHYLUV[ZWLJPÄJTLHZ\YHISLHUK[PTLIV\UK

;OLMVSSV^PUNH\KP[ÄUKPUNZYLSH[L[V[OLHIV]LJYP[LYPH! -VYHSSWYVNYHTTLZTVYL[OLU VM[OLWSHUULKHUKYLWVY[LK[HYNL[Z^LYLUV[ZWLJPÄJPUJSLHYS`PKLU[PM`PUN[OLUH[\YL and required level of performance, and measurable in identifying the required performance as illustrated by the example below:

3HUIRUPDQFHPHDVXUHLQGLFDWRU 7DUJHW Licensing and compliance: Monitoring of SAPO license Monitoring visits to SAPO postal outlets in all nine provinces conditions. and production of compliance report.

9LSPHIPSP[`VMYLWVY[LKWLYMVYTHUJLPUMVYTH[PVU

;OLYLWVY[LKWLYMVYTHUJLPUMVYTH[PVU^HZKLÄJPLU[PUYLZWLJ[VM[OLMVSSV^PUNJYP[LYPH! Validity: The reported performance did not occur and does not pertain to the entity Accuracy: The amounts, numbers and other data relating to reported actual performance have not been recorded and reported appropriately. Completeness: All actual results and events that should have been recorded have not been included in the reported performance information.

;OLMVSSV^PUNH\KP[ÄUKPUNZYLSH[L[V[OLHIV]LJYP[LYPH! :\MÄJPLU[HWWYVWYPH[LL]PKLUJLPUYLSH[PVU[VHU`VM[OLZLSLJ[ LKWYVNYHTTLZJV\SKUV[ILVI[HPULK;OLYL^LYLUV satisfactory audit procedures that I could perform to obtain the required assurance as to the validity, accuracy and completeness of the reported performance against predetermined objectives.

*VTWSPHUJL^P[OSH^ZHUKYLN\SH[PVUZ

:[YH[LNPJWSHUUPUNHUKWLYMVYTHUJLTHUHNLTLU[

;OLHJJV\U[PUNVMÄJLYKPKUV[LZ[HISPZOWYVJLK\YLZMVYX\HY[LYS`YLWVY[PUNVMWLYMVYTHUJL[V[OLL_LJ\[P]LH\[OVYP[`[VMHJPSP[H[L effective performance monitoring, evaluation and corrective action as required by TR 3.2 and PFMA section 38(1)(a)(i) and (b). 0U[LYUHSH\KP[

The internal audit function did not adhere to the requirements, as set by section 38(1)(a)(ii) of the PFMA and Treasury Regulation 3.2, PU[OH[PU[LYUHSH\KP[KPKUV[L]HS\H[LHUKKL]LSVWYLJVTTLUKH[PVUZVU[OLLMMLJ[P]LULZZHUKLMÄJPLUJ`VMJVU[YVSZ[OYV\NOV\[[OL year.

7YVJ\YLTLU[HUKJVU[YHJ[THUHNLTLU[

Goods and services with a transaction value of between R10 000 and R500 000 were procured without inviting at least three written price quotations from prospective suppliers, as per the requirement of Practice note 8 of 2007-08 issued in terms of section 76(4) (c) of the PFMA.

The entity did not invite competitive bids for all procurement above R500 000, as per the requirement of Practice note 8 of 2007-08 issued in terms of section 76(4)(c) of the PFMA.

,_WLUKP[\YLTHUHNLTLU[

;OLHJJV\U[PUNVMÄJLYKPKUV[[HRLLMMLJ[P]LHUKHWWYVWYPH[LZ[LWZ[VWYL]LU[PYYLN\SHYHUKMY\P[SLZZHUK^HZ[LM\SL_WLUKP[\YLHZWLY the requirements of section 38(1)(c)(ii) of the PFMA.

The entity did not perform adequate creditor reconciliations for accounts payable to the Department of Communication as required by section 38(1)(a).

9L]LU\LTHUHNLTLU[

;OLHJJV\U[PUNVMÄJLYKPKUV[[HRLLMMLJ[P]LHUKHWWYVWYPH[LZ[LWZ[VJVSSLJ[HSSTVUL`K\L[V[OLLU[P[`HZYLX\PYLKPU[LYTZVM PFMA section 38(1)(c)(ii) and TR 11.2.1.

The authority utilised a revenue suspense account, and did not implement adequate controls to clear the items on a monthly basis as required by TR 17.1.2(b).

The authority did not pay all fees received and held on behalf of the National Treasury to the National Revenue Fund within 30 days of receipt of such revenue as required by section 15(3) of the ICASA Act, 2000.

The authority accrued interest to the amount of R3 541 199 during the year which has not been paid over to the National Revenue Fund as required by section 15(3) of the ICASA Act, 2000.

9PZRHZZLZZTLU[

;OLHJJV\U[PUNVMÄJLYKPKUV[LUZ\YL[OH[HYPZRHZZLZZTLU[PZJVUK\J[LKYLN\SHYS`[VPKLU[PM`LTLYNPUNYPZRZVM[OLPUZ[P[\[PVUHZ required by TR 3.2.1.

104 105

05;,95(3*65;963

In accordance with the PAA and in terms of General notice 1111 of 2010, issued in Government Gazette 33872 of 15 December 2010, I considered internal control relevant to my audit, but not for the purpose of expressing an opinion on the effectiveness of internal JVU[YVS;OLTH[[LYZYLWVY[LKILSV^HYLSPTP[LK[V[OLZPNUPÄJHU[KLÄJPLUJPLZ[OH[YLZ\S[LKPU[OLIHZPZMVYVWPUPVU[OLÄUKPUNZVU [OLHUU\HSWLYMVYTHUJLYLWVY[HUK[OLÄUKPUNZVUJVTWSPHUJL^P[OSH^ZHUKYLN\SH[PVUZPUJS\KLKPU[OPZYLWVY[

3LHKLYZOPW

;OLHJJV\U[PUNVMÄJLYKPKUV[L_LYJPZLV]LYZPNO[YLZWVUZPIPSP[`YLNHYKPUNÄUHUJPHSHUKWLYMVYTHUJLYLWVY[PUNHUKJVTWSPHUJLHUK related internal controls.

(J[PVUZHYLUV[[HRLUPUH[PTLS`THUULY[VHKKYLZZ[OLYPZRZYLSH[PUN[V[OLHJOPL]LTLU[VMJVTWSL[LHUKHJJ\YH[LÄUHUJPHSYLWVY[PUN

-PUHUJPHSHUKWLYMVYTHUJLTHUHNLTLU[

The entity did not implement proper record keeping in a timely manner to ensure that complete, relevant and accurate information PZHJJLZZPISLHUKH]HPSHISL[VZ\WWVY[ÄUHUJPHSHUKWLYMVYTHUJLYLWVY[PUN

;OLLU[P[`KPKUV[WYLWHYLYLN\SHYHJJ\YH[LHUKJVTWSL[LÄUHUJPHSHUKWLYMVYTHUJLYLWVY[Z[OH[HYLZ\WWVY[LKHUKL]PKLUJLKI` reliable information.

Management did not review and monitor compliance with applicable laws and regulations.

.V]LYUHUJL

0U[LYUHSJVU[YVSKLÄJPLUJPLZHYLUV[PKLU[PÄLKHUKJVTT\UPJH[LKPUH[PTLS`THUULY[VHSSV^MVYJVYYLJ[P]LHJ[PVU[VIL[HRLU

Pretoria 30 July 2011 REPORT BY THE ACCOUNTING OFFICER

I have pleasure in presenting to Parliament the Independent Communications Authority of South Africa’s (“ICASA”) report for the year ended 31 March 2011. The report covers the period 1 April 2010 to 31 March 2011. As required by section 16(1)(b)(i) of the ICASA (J[VM¸0*(:((J[¹0*(:(OHZWYLWHYLKHKL[HPSLKHUU\HSYLWVY[MVY[OLHJ[P]P[PLZK\YPUN[OLÄUHUJPHSWLYPVK\UKLYYL]PL^

Background

ICASA is the regulator of the electronic communications and postal sectors. It was established in July 2000 in terms of the ICASA Act.

ICASA’s key functions are to: make regulations and policies that govern postal, telecommunications and broadcasting services; issue licences to providers of telecommunication, broadcasting and postal services; monitor the environment and enforce compliance with rules, regulations and policies; hear and decide on disputes and complaints brought by stakeholders; plan, control and manage the frequency spectrum; and protect the consumers from unfair business practices, poor quality services and harmful or inferior products.

Applicable legislation

ICASA derives its mandate from the following statutes: ICASA Act of 1999, Postal Services Act of 1998, Electronic Communications Act 35 of 2005, and the Broadcasting Act of 1999.

.LULYHSYL]PL^VM[OLZ[H[LVMÄUHUJPHSHMMHPYZ

;OLÄUHUJPHSZ[H[LTLU[ZOH]LILLUWYLWHYLKVUHNVPUNJVUJLYUIHZPZHUK[OLÄUHUJPHSWLYMVYTHUJLHUKWVZP[PVUKLTVUZ[YH[LZ that this basis is sound.

>LJVU[PU\L[VZ[YP]L[VPTWYV]L[OLÄUHUJPHSTHUHNLTLU[VM0*(:(HUKÄUHUJPHSWVSPJPLZOH]LILLUKL]LSVWLKHUKTVUP[VYLK[V give effect to this.

;OLHSSVJH[PVUMVY[OLÄUHUJPHS`LHY^HZL_JLLKLKI`9TPSSPVU;OLKLWYLJPH[PVU^HZI\KNL[LKMVY\UKLYHJJ\T\SH[LK Z\YWS\ZOLUJL[OLKLÄJP[YLSH[PUN[VKLWYLJPH[PVU^HZZL[VMMHNHPUZ[HJJ\T\SH[LKZ\YWS\Z;OPZHJJ\T\SH[LKZ\YWS\Z^HZJYLH[LK ^OLU.9(7^HZHKVW[LKPU[OLWYL]PV\ZÄUHUJPHS`LHY^OLYL[OLKLMLYYLKPUJVTL^HZJVU]LY[LK[VHJJ\T\SH[LKZ\YWS\Z

0U[OLÄUHUJPHS`LHY5H[PVUHS;YLHZ\Y`PZZ\LKHJPYJ\SHY^OLYLI`0*(:(^HZNYHU[LKWLYTPZZPVU[VYL[HPUPU[LYLZ[YLJLP]LK VUMH]V\YHISLIHURHJJV\U[IHSHUJLZ0*(:(YLJVNUPZLKPU[LYLZ[YLJLP]LKVM9TPSSPVUPU[OLÄUHUJPHSWLYPVK ¶ R15 million).

106 107

Council and Executive Management’s remuneration

+L[HPSZVM*V\UJPSHUK,_LJ\[P]L4HUHNLTLU[»ZYLT\ULYH[PVUHYLZL[V\[PUUV[L[V[OLÄUHUJPHSZ[H[LTLU[Z

Events after the reporting date

;OLYL^LYLUVZPNUPÄJHU[L]LU[Z[OH[[VVRWSHJLIL[^LLU[OLYLWVY[PUNKH[LHUK[OLKH[LPU^OPJO[OLÄUHUJPHSZ[H[LTLU[Z^LYL authorised for issue.

Business address

Physical address: Postal address: Blocks A, B, C & D Private Bag X10002 Pinmill Farm Sandton 164 Katherine Street 2146 Sandton 2128

;OLTIH+SHTPUP *OPLM,_LJ\[P]L6MÄJLY 1\S` INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA STATEMENT OF FINANCIAL PERFORMANCE for the year ended 31 March 2011

4HYJO 4HYJO 5V[L 9 9 (J[\HS 9LZ[H[LK

Revenue from non-exchange transactions 2 270 205 869 Revenue from exchange transactions 4 15 228 157 ;V[HSYL]LU\L 285 434 026

Administrative expenses 5 (36 255 924) Staff costs 6 (159 040 381) Audit fees 8 (1 602 727) Other operating expenses 9 (85 633 622) Finance costs 10 (5 834) Depreciation 12 (7 372 425) Amortisation 13 (293 295) ;V[HSL_WLUZLZ (290 204 208) +LÄJP[MVY[OLWLYPVK (4 770 182)

108 109

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA STATEMENT OF FINANCIAL POSITION as at 31 March 2011

4HYJO 4HYJO 5V[L 9 9 (J[\HS 9LZ[H[LK (::,;:

5VUJ\YYLU[HZZL[Z 92 916 596 Property, plant and equipment 12 87 656 674 Intangible assets 13 5 259 922

*\YYLU[HZZL[Z 583 413 954 Trade and other receivables from exchange transactions 14 1 451 386 Other receivables from non-exchange transactions 14.1 5 447 Current portion of operating lease assets 20 - National Revenue Fund – Administered Assets 15 496 281 284 Prepayments 16 4 531 485 Cash and cash equivalents 17 81 144 352

;6;(3(::,;: 676 330 550

30()030;0,:

*\YYLU[SPHIPSP[PLZ 554 669 937 Trade and other payables from exchange transactions 18 32 660 134 Trade and other payables from non-exchange transactions 18.1 20 937 National Revenue Fund payables 19 521 966 213 Current portion of operating lease liability 20 22 653

5VUJ\YYLU[SPHIPSP[PLZ - Non-current portion of operating lease liability 20 -

;6;(330()030;0,: 554 669 937 FUNDS ACCUMULATED RESERVES 121 660 613 Accumulated surplus 121 660 613

;6;(3-<5+:(5+30()030;0,: 676 330 550 INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA STATEMENT OF CHANGES IN NET ASSETS for the year ended 31 March 2011

5V[L (JJ\T\SH[LK Z\YWS\Z 9 )HSHUJLHZH[4HYJO 126 430 795 Surplus for the year as previously reported 6 210 939 Effect of prior period error 3 (10 981 121) 9LZ[H[LKIHSHUJLHZH[4HYJO 121 660 613 +LÄJP[MVY[OLWLYPVK (10 972 630) )HSHUJLH[4HYJO 110 687 983

110 111

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA CASH FLOW STATEMENT for the year ended 31 March 2011

4HYJO 4HYJO 5V[L 9 9

(J[\HS 9LZ[H[LK

*(:/-36>:-96467,9(;05.(*;0=0;0,: 9LJLPW[Z Cash received from DoC 269 607 000 Cash received by Administered Revenue 1 913 146 304 Finance income 15 607 109 7H`TLU[Z Cash paid by Administered Revenue (1 904 279 883) Cash paid to suppliers (109 015 012) Cash paid to employees (132 635 207) Employees tax paid (26 707 045) Finance costs 10 (5 834) 5L[JHZOÅV^ZMYVTVWLYH[PUNHJ[P]P[PLZ 22 25 717 432 *(:/-36>:-96405=,:;05.(*;0=0;0,: Purchase of plant and equipment 12 (20 448 330) Purchase of intangible assets 13 (2 773 147) Proceeds from sale of plant and equipment 115 976 5L[JHZOÅV^ZMYVTPU]LZ[PUNHJ[P]P[PLZ (23 105 501) 5L[KLJYLHZLPUJYLHZLPUJHZOHUKJHZOLX\P]HSLU[Z 2 611 931 Cash and cash equivalents at the beginning of the period 78 532 421 *HZOHUKJHZOLX\P]HSLU[ZH[[OLLUKVM[OLWLYPVK 17 81 144 352 INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA STATEMENT OF COMPARISON OF BUDGET AND ACTUAL AMOUNTS for the year ended 31 March 2011

+PMMLYLUJL IL[^LLU-PUHS 4HYJO 4HYJO 4HYJO )\KNL[HUK(J[\HS 9 9 9 9 )\KNL[ )\KNL[ (J[\HS (WWYV]LK -PUHS 9,=,5<, Revenue from non-exchange services 290 923 000 291 171 453 (248 453) Other income from exchange services 10 018 000 5 653 589 4 364 411 Total revenue 300 941 000 296 825 042 4 115 958

Administrative expenses (32 707 803) (32 149 834) (557 969) Staff costs (173 833 356) (170 958 691) (2 874 665) Audit fees (3 049 780) (2 937 234) (112 546) Other operating expenses (105 684 760) (86 485 587) (19 199 173) Depreciation (12 852 097) (14 066 930) 1 214 833 Amortisation (1 490 208) (1 193 135) (297 073) Finance costs - (6 261) 6 261 ;V[HSL_WLUZLZ (329 618 004) (307 797 672) (21 820 332)

:\YWS\ZKLÄJP[ (28 677 004) (10 972 630) (17 704 374)

(KKIHJR!KLWYLJPH[PVUHUK HTVY[PZH[PVU 14 342 305 15 260 065 (917 760) (14 334 699) 4 287 435 (18 622 134) *(7,? (15 539 246) (20 960 973) 5 314 609

112 113

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA STATEMENT OF COMPARISON OF BUDGET AND ACTUAL AMOUNTS for the year ended 31 March 2011

9LJVUJPSPH[PVUVMI\KNL[Z\YWS\Z^P[O[OLKLÄJP[PU[OLZ[H[LTLU[VMÄUHUJPHSWLYMVYTHUJLMVY4HYJO

6WLYH[PUN -PUHUJPUN 0U]LZ[PUN ;V[HS Actual amount on comparable basis 307 797 672 - 20 960 973 328 758 645 as presented in the Budget and Actual comparative statement Basis difference: Timing difference (10 752 607) - ( 107 118) (10 859 725) Entity difference - - - - Actual amount in the statement of cash 297 045 065 - 20 853 855 317 898 920 ÅV^Z

;OLI\KNL[PZWYLWHYLKVUHUHJJY\HSIHZPZV]LY[OYLLÄUHUJPHS`LHYZHUKPZHWWYV]LKI`[OL7VY[MVSPV*VTTP[[LLVU*VTT\UPJH[PVU HUKPZILPUNYL]PL^LKI`*V\UJPS(I\KNL[YL]PL^KVULH[[OLLUKVM4HYJOJV]LYLK[OLÄUHUJPHS`LHYVUS`;OL virements are authorised internally in terms of the delegations of authority.

Revenue

;OLHSSVJH[PVUVM[OLI\KNL[HUKÄUHUJLPUJVTL^HZ\ZLK[VKLSP]LYVU[OLZ[YH[LNPJVIQLJ[P]LZHZYLÅLJ[LKPU[OLHUU\HSYLWVY[ and acquisition of assets for delivery of service as per strategic plan and mandate. The revenue for the 2010/11 was below the target because the interest accrued was less than anticipated due to a low interest rate. The Authority received all its allocation as approved by Parliament.

Administrative Expenditure

The budget for administrative costs was increased from R30 802 823 to R32 707 803 in order to accommodate the international travelling for international regulatory meeting and working groups as required by United Nations. The Authority is involved in different international working groups that develop electronic communication and postal standards. Initially this budget for international travelling was reduced drastically in order to fund the FIFA World Cup project because we did not get the funding for that.

There was a saving of R557 969 against the full year budget of R32 707 803. The Authority reduced the printing and stationary HZWHY[VMPTWYV]PUNLMÄJPLUJ`0UHKKP[PVU[V[OPZ[OLYL^HZSLZZSVJHS[YH]LSSPUNK\YPUN-0-(>VYSK*\WILJH\ZL[OLYLNPVUHSZ[HMM JVUJLU[YH[LKH[TVUP[VYPUN[OL>VYSK*\WVWLYH[PVUHUKP[^HZHSZVL_WLUZP]L[V\ZLÅPNO[ZK\YPUN[OPZWLYPVKOLUJL[OL(\[OVYP[` WVZ[WVULKVYJHUJLSSLKZVTL[YH]LSSPUN;OPZYLZ\S[LKPUHZH]PUNH[[OLLUKVM[OLÄUHUJPHS`LHY;OL(\[OVYP[`HSZVJOHUNLK[VHU electronic recruitment system and this created a further saving. Staff Costs

The original staff costs budget of R159 985 447 was increased by R13 847 909 in order to accommodate the temporary staff costs [OH[^LYLUV[PUP[PHSS`JH[LYLKMVY([[OLLUKVMÄUHUJPHS`LHY[OLYL^HZHZH]PUNVM9 HNHPUZ[[OLM\SS`LHYI\KNL[VMZ[HMM costs of R173 833 356 due to vacant posts and a delay of employing the temporary staff, particularly the ones responsible for election monitoring because they could not be employed until the election date was announced.

Audit Fees

;OL(\KP[MLLZOH]LPUJYLHZLKJVTWHYLK[V[OLWYPVY`LHYHZHYLZ\S[VM[OL(\KP[VY.LULYHSWLYMVYTPUNHUPU[LYPTH\KP[MVY[OLÄYZ[ time. The initial Audit fees budget of R2 200 000 was increased by R849 780 because the Auditor-General planned the interim H\KP[K\YPUN[OLJV\YZLVM[OLÄUHUJPHS`LHYHUK[OPZ^HZUV[[OLWYHJ[PJLILMVYL;OL`HSZVWSHUULK[VJVUK\J[HU0;H\KP[VU WH`YVSSZ`Z[LTHUKUL^ÄUHUJPHSZ`Z[LTZ;OLYL^HZ\UKLYL_WLUKP[\YLVM9;OLPU[LYPTH\KP[MVY[OL9LNPVUZHUK[OL (KTPUPZ[LYLK9L]LU\L:LJ[PVU^HZUV[KVUL;OL(\[OVYP[`^HZZ[PSSI\Z`KL]LSVWPUN[OLÄUHUJPHSZ`Z[LTZVU[OL(KTPUPZ[LYLK 9L]LU\L-\UKHUK[OLYLMVYL[OL(\KP[VY¶.LULYHSJV\SKUV[ÄUHSPZL[OLLU[PYLWSHUULKPU[LYPTH\KP[PU[PTL

Other Operating Expenses

;OLPUP[PHSI\KNL[VM9 THPUS`VUV[OLYVWLYH[PUNL_WLUZLZ^HZPUJYLHZLKI`9[VH\NTLU[[OLOLHKVMÄJL YLU[HSHUKPUJYLHZLKYLU[HSVM[OL7VY[,SPaHIL[OHUK+\YIHUYLNPVUHSVMÄJLZ;OL(\[OVYP[`JV\SKUV[YLSVJH[LK\L[VSHJRVMM\UKZ and the rental was increased more than anticipated because the renewal was for a short period. The rental of relocated regions PUJYLHZLKILJH\ZLSHYNLVMÄJLZ^LYLVJJ\WPLKHZWLY[OLULLKVM [OL YLNPVUZ ;OLYL ^HZ H ZH]PUN VM 9 VU V[OLY operating expenses due to the fact that the budgets are prepared on the cash basis while the records are kept on the accrual basis. ;OLZTVV[OPUNVMYLU[HSWH`TLU[ZV]LY[OLWLYPVKVM[OLSLHZLHSZVOHZHTHQVYPTWHJ[VU[OLYLWVY[LKÄN\YLZ

Depreciation

The depreciation charge was higher than that budget mainly due to the reduction of expected useful lives for some major assets categories.

Amortisation

The amortisation charge for the year was lower than budget due to the fact that a major component of additions to intangible assets ^HZKVUL[V^HYKZ[OLLUKVM[OLÄUHUJPHS`LHY

CAPEX

The Authority’s CAPEX was mainly funded from accumulated surplus earned which arose when the Authority earned interest on Z\YWS\ZM\UKZI\[^HZUV[\ZLKPU[OVZLÄUHUJPHS`LHYZPU^OPJOP[^HZLHYULK

114 115

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

:\TTHY`VMZPNUPÄJHU[HJJV\U[PUNWVSPJPLZ

;OLWYPUJPWHSHJJV\U[PUNWVSPJPLZHWWSPLKPU[OLWYLWHYH[PVUVM[OLZLÄUHUJPHSZ[H[LTLU[ZHYLZL[V\[ILSV^;OLZLWVSPJPLZOH]LILLU consistently applied to all the years presented, unless otherwise stated.

1.1 Basis of preparation

;OL ÄUHUJPHS Z[H[LTLU[Z OH]L ILLU WYLWHYLK PU HJJVYKHUJL ^P[O [OL:[HUKHYKZVM.LULYHSS`9LJVNUPZLK(JJV\U[PUN7YHJ[PJL (GRAP), including any interpretations, directives and guidelines of such relevant statements issued by the Accounting Standards Board. The following statements were approved and effective at the reporting date:

GRAP 1 Presentation of Financial Statements GRAP 2 Cash Flow Statements GRAP 3 Accounting Policies, Changes in Accounting Estimates and Errors GRAP 4 The Effects of Changes in Foreign Exchange Rates GRAP 5 Borrowing Costs GRAP 6 Consolidated and Separate Financial Statements GRAP 7 Investments in Associates GRAP 8 Interests in Joint Ventures GRAP 9 Revenue from Exchange Transactions .9(7-PUHUJPHS9LWVY[PUNPU/`WLYPUÅH[PVUHY`,JVUVTPLZ GRAP 11 Construction Contracts GRAP 12 Inventories GRAP 13 Leases GRAP 14 Events After the Reporting Date GRAP 16 Investment Property GRAP 17 Property, Plant and Equipment GRAP 19 Provisions, Contingent Liabilities and Contingent Assets GRAP 100 Non-current Assets Held for Sale and Discontinued Operations GRAP 101 Agriculture GRAP 102 Intangible Assets INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

+PYLJ[P]LZHUKN\PKLSPULZ

Directives and guidelines issued by the Accounting Standards Board (ASB) form part of the GRAP Reporting Framework.

,MMLJ[P]L0-9:ZHUK0-90*Z

Effective IFRSs and IFRICs that are applied considering the provisions in paragraphs 20 to 26 of Directive 5: IFRS 3 (AC 140) Business Combinations IFRS 4 (AC 141) Insurance Contracts IFRS 6 (AC 143) Exploration for and Evaluation of Mineral Resources IAS 12 (AC 102) Income Taxes SIC 21 (AC 421) Income Taxes – Recovery of Revalued Non-Depreciable Asset SIC 25 (AC 425) Income Taxes – Changes in the Tax Status of an Entity or its Shareholders SIC 29 (AC 429) Service Concession Arrangements – Disclosures IFRIC 4 (AC 437) Determining whether an Arrangement contains a Lease IFRIC 12 (AC 445) Service Concession Arrangements IFRIC 13 (AC 446) Customer Loyalty Programmes IFRIC 15 (AC 448) Agreements for the Construction of Real Estate IFRIC 17 (AC 450) Distributions of Non-cash Assets to Owners IFRIC 18 AC (451) Transfer of Assets from Customers

The following statements of GRAP were approved but not yet effective at the reporting date and they did not have an impact on the reporting:

GRAP 21 - Impairment of non-cash-generating assets GRAP 23 - Revenue from Non-exchange Transactions (Taxes and Transfers) .9(7,TWSV`LL)LULÄ[Z GRAP 26 - Impairment of cash-generating assets GRAP 103 - Heritage Assets GRAP 104 - Financial Instruments GRAP 105 - Transfer of Functions Between Entities Under Common Control GRAP 106 - Transfer of Functions Between Entities Not Under Common Control GRAP 107 – Mergers

116 117

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

:\TTHY`VMZPNUPÄJHU[HJJV\U[PUNWVSPJPLZJVU[PU\LK

1.1 Basis of preparation (continued)

Standards and amendments to be applied for the 2010/11 reporting period

;VWPJ 9LMLYLUJL (WWSPJH[PVU IFRS 3 Business Combinations All entities must apply IFRS 3 as issued in 2008 for the 2010/11 reporting period. IFRS 4 Insurance Contracts Entities should apply IFRS 4 as issued in March 2004; and apply all subsequent amendments made to IFRS 4 except those revisions arising from: The revision of IAS 1, Presentation of Financial Statements (September 2007) The revision of IAS 27, Consolidated and Separate Financial Statements (January 2008) Issue of IFRS 9, Financial Instruments. IFRS 6 Exploration for and Entities apply IFRS 6 as issued in December 2004; and apply all subsequent Evaluation of Mineral amendments made to IFRS 6 except those revisions arising from: Resources The issue of IFRS 1, First Time Adoption of IFRSs The issue of IFRS 8, Operating Segments The revision of IAS 1, Presentation of Financial Statements (September 2007) Improvements to IFRSs (issued May 2010) IFRS 7 Financial Instruments: Entities apply IFRS 7 as issued in August 2005; and apply all subsequent amendments Disclosures made to IFRS 7 except those revisions arising from: The revision of IAS 1, Presentation of Financial Statements (September 2007) Disclosures – Transfers of Assets (Issued October 2009) Improvements to IFRSs (issued May 2010) Issue of IFRS 9, Financial Instruments. IAS 12 Income Taxes Entities apply IAS 12 as issued in October 1996; and apply all subsequent amendments made to IAS 12 except those revisions arising from: The revision of IAS 1, Presentation of Financial Statements (September 2007) Issue of IFRS 9, Financial Instruments. INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

;VWPJ 9LMLYLUJL (WWSPJH[PVU IAS 19 ,TWSV`LL)LULÄ[Z Entities apply IAS 19 as issued in February 1998; and apply all subsequent amendments made to IAS 19 except those revisions arising from: The issue of IFRS 8, Operating Segments The revision of IAS 1, Presentation of Financial Statements (September 2007) The revision of IAS 24, Related Party Disclosures (issued November 2009) Issue of IFRS 9, Financial Instruments. IAS 32 Financial Instruments: Entities apply IAS 32 as issued in December 2003; and apply all subsequent Presentation amendments made to IAS 32 except those revisions arising from: The issue of IFRS 8, Operating Segments The revision of IAS 1, Presentation of Financial Statements (September 2007) The revision of IAS 27, Consolidated and Separate Financial Statements (January 2008) Improvements to IFRSs (issued May 2010) Issue of IFRS 9, Financial Instruments. IAS 39 Financial Instruments: Entities apply IAS 39 as issued in December 2003; and apply all subsequent Recognition and amendments made to IAS 32 except those revisions arising from: Measurement The issue of IFRS 8, Operating Segments The revision of IAS 1, Presentation of Financial Statements (September 2007) The revision of IAS 27, Consolidated and Separate Financial Statements (January 2008) Improvements to IFRSs (issued May 2010) Issue of IFRS 9, Financial Instruments

118 119

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

:\TTHY`VMZPNUPÄJHU[HJJV\U[PUNWVSPJPLZJVU[PU\LK

1.1 Basis of preparation (continued)

+PYLJ[P]LZHUKN\PKLSPULZ

The following statements of GRAP were approved but not yet effective at the reporting date and they did not have an impact on the reporting:

IGRAP2 - Changes in Existing Decomissioning Restoration and Similar Liabilities IGRAP3 - Determining Whether an Arrangement Contains a Lease IGRAP4 - Rights to Interests Arising from Decommissioning, Restoration and Environmental Rehabilitation Funds 0.9(7(WWS`PUN[OL9LZ[H[LTLU[(WWYVHJO\UKLY[OL:[HUKHYKVM.9(7VU-PUHUJPHS9LWVY[PUNPU/`WLYPUÅH[PVUHY` Economies IGRAP6 - Loyalty Programmes 0.9(7;OL3PTP[VUH+LÄULK)LULÄ[(ZZL[4PUPT\T-\UKPUN9LX\PYLTLU[ZHUK[OLPY0U[LYHJ[PVU IGRAP8 - Agreements for the Construction of Assets from Exchange Transactions IGRAP9 - Distributions of Non-cash Assets to Owners IGRAP10 - Assets Received from Customers IGRAP13 - Operating Leases - Incentives IGRAP14 - Evaluating the Substance of Transactions Involving the Legal Form of a Lease IGRAP15 - Revenue - Barter Transactions Involving Advertising Services

The following standard of GRAP may be used to interpret the requirements of other Standards of GRAP:

GRAP 24 - Presentation of Budget Information in Financial Statements

The following standard of GRAP has been approved but the entities are not required to apply it:

GRAP 18 - Segment Reporting INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

1.2 Functional and presentation currency

;OLÄUHUJPHSZ[H[LTLU[ZOH]LILLUWYLWHYLK\UKLY[OLOPZ[VYPJHSJVZ[JVU]LU[PVUHZTVKPÄLKI`[OLYL]HS\H[PVUVMJLY[HPUÄUHUJPHS HZZL[ZHUKSPHIPSP[PLZH[HTVY[PZLKJVZ[VYMHPY]HS\L[OYV\NOZ\YWS\ZVYKLÄJP[;OLÄUHUJPHSZ[H[LTLU[ZOH]LILLUWYLZLU[LKPU[OL South African Rand (ZAR), as this is the currency in which the majority of the transactions are denominated.

:PNUPÄJHU[Q\KNLTLU[Z

0UWYLWHYPUN[OLÄUHUJPHSZ[H[LTLU[ZTHUHNLTLU[PZYLX\PYLK[VTHRLLZ[PTH[LZHUKHZZ\TW[PVUZ[OH[LMMLJ[[OLHTV\U[ZWYLZLU[LK PU[OLÄUHUJPHSZ[H[LTLU[ZHUKYLSH[LKKPZJSVZ\YLZ0[HSZVYLX\PYLZTHUHNLTLU[[VL_LYJPZLP[ZQ\KNLTLU[PU[OLWYVJLZZVMHWWS`PUN the Authority’s accounting policies. Use of available information and the application of judgement are inherent in the formation of LZ[PTH[LZ;OLMHPY]HS\LZVMÄUHUJPHSPUZ[Y\TLU[Z^P[OZ[HUKHYK[LYTZHUKJVUKP[PVUZHUK[YHKLKPUHJ[P]LSPX\PKHUKVYNHUPZLK ÄUHUJPHSTHYRL[ZHYLKL[LYTPULK^P[OYLMLYLUJL[V[OLHWWSPJHISLX\V[LKTHYRL[WYPJLZ-VYV[OLYÄUHUJPHSPUZ[Y\TLU[ZTL[OVKZ Z\JOHZ[OLKPZJV\U[LKJHZOÅV^HUHS`ZPZHYL\ZLK[VKL[LYTPUL[OLMHPY]HS\LZVMV[OLYÄUHUJPHSPUZ[Y\TLU[Z(J[\HSYLZ\S[ZPU[OL M\[\YLJV\SKKPMMLYMYVT[OLZLLZ[PTH[LZ^OPJOTH`ILTH[LYPHS[V[OLÄUHUJPHSZ[H[LTLU[Z:PNUPÄJHU[Q\KNLTLU[ZPUJS\KL!

(UU\HSL]HS\H[PVUVMWYVWLY[`WSHU[HUKLX\PWTLU[HUKPU[HUNPISLHZZL[Z

The Authority reviews its property, plant and equipment for possible impairment, changes in useful life and changes in residual ]HS\LZH[[OLLUKVMLHJOÄUHUJPHS`LHY

The management determines the estimated useful lives and related depreciation charges for property, plant and equipment as well as its intangible assets. The estimates are based on the assessed conditions of the assets, changes in technology such as new technical innovations being introduced in the industry thus rendering our assets obsolete as well as expected future spending VUJHWP[HSHZZL[Z;OLZLLZ[PTH[LZJHUJOHUNLZPNUPÄJHU[S`HZHYLZ\S[VMJOHUNLZPU[OLJVUKP[PVUZVMHZZL[ZPU[YVK\J[PVUVMUL^ [LJOUVSVNPLZHUKH]HPSHIPSP[`VMÄUHUJPHSYLZV\YJLZ[VM\UKL_WLJ[LKM\[\YLZWLUKPUNVUJHWP[HSHZZL[Z

Management will increase the depreciation charge where useful lives are less than previously estimated lives, or it will write-off or write-down technically obsolete assets that have been abandoned or sold.

1.4 Provision for impairment of receivables

A provision for impairment of trade receivables is established when there is objective evidence that the Authority will not be able to collect all amounts due according to the original terms of receivables. The allowance recognised is measured as the difference IL[^LLU[OLHZZL[»ZJHYY`PUNHTV\U[HUK[OLWYLZLU[]HS\LVMLZ[PTH[LKM\[\YLJHZOÅV^Z^OLYL[OL[PTL]HS\LVMTVUL`OHZH material impact, discounted at the effective interest rate computed at initial recognition. Any impairment is recognised immediately PU[OLZ[H[LTLU[VMÄUHUJPHSWLYMVYTHUJL

120 121

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

1.5 Government grants

;OL (\[OVYP[` PZ ÄUHUJLK MYVT TVUL` HWWYVWYPH[LK I` 7HYSPHTLU[(SSPUÅV^ZVMYLZV\YJLZMYVTHUVUL_JOHUNL[YHUZHJ[PVU YLJVNUPZLKHZHUHZZL[HYLYLJVNUPZLKHZYL]LU\LL_JLW[[V[OLL_[LU[[OH[HSPHIPSP[`PZHSZVYLJVNUPZLKPUYLZWLJ[VM[OLZHTLPUÅV^

(SS[YHUZHJ[PVUZ[OH[ZH[PZM`HWYLZLU[VISPNH[PVUYLJVNUPZLKHZHSPHIPSP[`PUYLZWLJ[VMHUPUÅV^VMYLZV\YJLZMYVTHUVUL_JOHUNL transaction recognised as an asset, it reduces the carrying amount of the liability recognised and revenue equal to the deduction is recognised. Revenue from non-exchange transactions is measured at the amount of the increase in net assets. A present obligation HYPZPUNMYVTHUVUL_JOHUNL[YHUZHJ[PVU[OH[TLL[Z[OLKLÄUP[PVUVMHSPHIPSP[`PZYLJVNUPZLKHZHSPHIPSP[`^OLUP[PZWYVIHISL[OH[HU V\[ÅV^VMYLZV\YJLZLTIVK`PUNM\[\YLLJVUVTPJILULÄ[ZVYZLY]PJLWV[LU[PHS^PSSILYLX\PYLK[VZL[[SL[OLVISPNH[PVUHUKHYLSPHISL estimate can be made of the amount of the obligation. The liability amount recognised is the best estimate of the amount required to settle the present obligation at the reporting date. Non-exchange revenue from taxes is only recognised when the taxable event occurs and the asset recognition criteria are met.

1.6 Property, plant and equipment

Property, plant and equipment (owned and leased) are stated at cost less accumulated depreciation and accumulated impairment losses, if any. The cost of property, plant and equipment includes all directly attributable expenditure incurred in the acquisition, establishment and installation of such assets so as to bring them to the location and condition necessary for it to be capable of operating in the manner intended by management. Interest costs are not capitalised. Where an item of property, plant and equipment is acquired at no cost, or for a nominal cost, its cost is its fair value at the date of acquisition.

Depreciation is calculated so as to write off the cost of property, plant and equipment on a straight-line basis, over the estimated useful lives to the estimated residual values. Useful lives, residual values and depreciation are reviewed annually with the effect of any changes in estimate accounted for on the prospective basis. Residual values are measured as the estimated amount currently YLJLP]HISLMVYHUHZZL[PM[OLHZZL[^LYLHSYLHK`VM[OLHNLHUKJVUKP[PVUL_WLJ[LKH[[OLLUKVMP[Z\ZLM\SSPML,HJOZPNUPÄJHU[ component included in an item of property, plant and equipment is separately recognised and depreciated.

Depreciation commences when the asset is ready for its intended use. Depreciation of an asset ceases at an earlier of the day the HZZL[PZJSHZZPÄLKHZOLSKMVYZHSLPUHJJVYKHUJL^P[O.9(7VY[OLKH[L[OLHZZL[PZKLYLJVNUPZLK

Properties in course of construction for production, rental or administrative purposes, or for any purposes not yet determined, are carried at cost, less any recognised impairment losses.

(ZZL[ZOLSK\UKLYÄUHUJLSLHZLZHYLKLWYLJPH[LKV]LY[OLPYL_WLJ[LK\ZLM\SSP]LZVU[OLZHTLIHZPZHZ[OLV^ULKHZZL[ZVY^OLYL shorter, the term of the relevant lease if there’s no reasonable certainty that ICASA will obtain ownership at the end of the lease term. INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

Repairs and maintenance activities, which neither prolong nor materially add to the value of the assets, are recognised as expenses in the period incurred. Minor plant and equipment items are also recognised as an expense during the period in which they are incurred.

:\YWS\ZVYKLÄJP[VU[OLYL[PYLTLU[VYKPZWVZHSVMWYVWLY[`WSHU[HUKLX\PWTLU[ILPUN[OLKPMMLYLUJLIL[^LLU[OLHJ[\HSWYVJLLKZ HUK[OLJHYY`PUNHTV\U[ZVM[OLHZZL[ZHYLYLJVNUPZLKHZHZ\YWS\ZVYKLÄJP[PU[OLWLYPVKPUÔPJO[OL`VJJ\Y;OLKPZWVZHS KH[LPZKL[LYTPULKHZ[OLKH[LVUÔPJO0*(:(OHZ[YHUZMLYYLKHSS[OLZPNUPÄJHU[YPZRHUKYL^HYKZVMVÛLYZOPW0*(:(KVLZUV[ retain either continuing managerial involvement to the degree associated with ownership or effective control over the goods sold, WYVJLLKZVU[OLZHSLZJHUILYLSPHIS`TLHZ\YLKP[PZWYVIHISL[OH[[OLLJVUVTPJILULÄ[ZHZZVJPH[LK^P[O[OL[YHUZHJ[PVU^PSSÅV^ to ICASA and the costs incurred or to be incurred in respect of the transaction can be reliably measured.

;OLHZZL[ZHYLKLYLJVNUPZLK^OLU[OLZPNUPÄJHU[YPZRHUKYL^HYKZVMV^ULYZOPWHYL[YHUZMLYYLK[VH[OPYKWHY[`

Property, plant and equipment acquired in exchange for a non-monetary asset or assets is measured at fair value unless the exchange transaction lacks commercial substance or the fair value of neither the asset received nor the asset given up is reliably measurable. If the acquired item is not measured at fair value, its cost is measured at the carrying amount of the asset given up.

Where a lease contains a restoration clause, or where historical experience indicates that restoration costs will be incurred, a liability for the restoration costs is recorded. The liability recorded is measured at the present value of the estimated future restoration costs to be incurred.

The present value of the liability is capitalised to the underlying asset to which the restorations costs relate at the inception of the restoration obligation. These amounts are amortised over the estimated useful life of the related asset. The restoration liability is accreted to its future value over the lease period.

Depreciation is calculated on the straight-line method to write off the cost less residual values of each asset over their estimated useful lives as follows:

0[LT

;OLKLWYLJPH[PVUJOHYNLMVYLHJOWLYPVKPZYLJVNUPZLKPUZ\YWS\ZVYKLÄJP[MVY[OLWLYPVK

122 123

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

:\TTHY`VMZPNUPÄJHU[HJJV\U[PUNWVSPJPLZJVU[PU\LK

1.7 Intangible assets

Acquired computer software licences are carried at cost less any accumulated amortisation and accumulated impairment losses, if any. Amortisation on these costs is provided to write down the intangible assets, on a straight line basis, over their useful lives as follows:

0[LT

Expenditure on research is recognised as an expense when it is incurred.

Costs associated with developing or maintaining computer software programmes are recognised as an expense as incurred. Costs [OH[HYLKPYLJ[S`HZZVJPH[LK^P[O[OLKL]LSVWTLU[VMPKLU[PÄHISLHUK\UPX\LZVM[^HYLWYVK\J[ZJVU[YVSSLKI`[OL(\[OVYP[`HUK[OH[ ^PSSWYVIHIS`NLULYH[LLJVUVTPJILULÄ[ZVYZLY]PJLWV[LU[PHSL_JLLKPUNJVZ[ZIL`VUKVUL`LHYHYLYLJVNUPZLKHZPU[HUNPISLHZZL[Z Costs include the employee costs incurred as a result of developing software and an appropriate portion of relevant overheads. Amortisation commences when the intangible asset is available for use. Computer software development costs recognised as assets are amortised over their estimated useful lives. Internally generated brands are not recognised as intangible assets.

:\YWS\ZVYKLÄJP[VU[OLYL[PYLTLU[VYKPZWVZHSVMPU[HUNPISLHZZL[ZILPUN[OLKPMMLYLUJLIL[^LLU[OLHJ[\HSWYVJLLKZHUK[OL JHYY`PUNHTV\U[ZVM[OLHZZL[ZHYLYLJVNUPZLKPU[OLZ\YWS\ZVYKLÄJP[PU[OLWLYPVKPUÔPJO[OL`VJJ\Y;OLKPZWVZHSKH[LPZ KL[LYTPULKHZ[OLKH[LPUÔPJO0*(:(OHZ[YHUZMLYYLKHSS[OLZPNUPÄJHU[YPZRHUKYL^HYKZVMVÛLYZOPW0*(:(KVLZUV[YL[HPULP[OLY continuing managerial involvement to the degree associated with ownership or effective control over the goods sold, proceeds on [OLZHSLZJHUILYLSPHIS`TLHZ\YLKP[PZWYVIHISL[OH[[OLLJVUVTPJILULÄ[ZHZZVJPH[LK^P[O[OL[YHUZHJ[PVU^PSSÅV^[V0*(:(HUK the costs incurred or to be incurred in respect of the transaction can be reliably measured.

Amortisation commences when the intangible asset is ready for its intended use. Depreciation of an intangible asset ceases at an LHYSPLYVM[OLKH`[OLHZZL[PZJSHZZPÄLKHZOLSKMVYZHSLPUHJJVYKHUJL^P[O.9(7VY[OLKH[L[OLHZZL[PZKLYLJVNUPZLK(SS intangible assets that arise from development are recognised ICASA can demonstrate that the technical feasibility of completing the intangible asset so that it will be available for use or sale, its intention to complete the intangible asset and use or sell it, its ability to \ZLVYZLSS[OLPU[HUNPISLHZZL[OV^[OLPU[HUNPISLHZZL[^PSSNLULYH[LWYVIHISLM\[\YLLJVUVTPJILULÄ[ZVYZLY]PJLWV[LU[PHS[OL H]HPSHIPSP[`VMHKLX\H[L[LJOUPJHSÄUHUJPHSHUKV[OLYYLZV\YJLZ[VJVTWSL[L[OLKL]LSVWTLU[HUK[V\ZLVYZLSS[OLPU[HUNPISLHZZL[ and its ability to measure reliably the expenditure attributable to the intangible asset during its development. INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

;OLHTVY[PZH[PVUWLYPVKHUK[OLHTVY[PZH[PVUTL[OVKMVYHUPU[HUNPISLHZZL[^P[OHÄUP[L\ZLM\SSPMLHYLYL]PL^LKH[LHJOYLWVY[PUN date. If the expected useful life of the asset is different from previous estimates, the amortisation period is changed accordingly. If [OLYLOHZILLUHJOHUNLPU[OLL_WLJ[LKWH[[LYUVMJVUZ\TW[PVUVM[OLM\[\YLLJVUVTPJILULÄ[ZVYZLY]PJLWV[LU[PHSLTIVKPLKPU [OLHZZL[[OLHTVY[PZH[PVUTL[OVKPZJOHUNLK[VYLÅLJ[[OLJOHUNLKWH[[LYU

;OLYLZPK\HS]HS\LVMHUPU[HUNPISLHZZL[^P[OHÄUP[L\ZLM\SSPMLPZHZZ\TLK[VILaLYV\USLZZ[OLYLPZHJVTTP[TLU[I`H[OPYKWHY[`[V purchase the asset at the end of its useful life; or there is an active market for the asset and such residual value can be determined by reference to that market; and it is probable that such a market will exist at the end of the asset’s useful life. An intangible asset is KLYLJVNUPZLKVUKPZWVZHSVMZ\JOPU[HUNPISLHZZL[VY^OLUUVM\[\YLLJVUVTPJILULÄ[ZVYZLY]PJLWV[LU[PHSHYLL_WLJ[LKMYVTP[Z use or disposal.

0TWHPYTLU[VMUVUÄUHUJPHSHZZL[Z

Cash-generating assets that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable at the reporting date. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purpose of assessing impairment, assets are grouped at the lowest levels for which there HYLZLWHYH[LS`PKLU[PÄHISLJHZOÅV^ZJHZONLULYH[PUN\UP[Z

Non-cash generating assets are impaired when the amount by which the carrying amount of an asset exceeds its recoverable service amount. The recoverable service amount is the higher of an asset’s fair value less costs to sell and its value in use. If 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. Such reduction of an asset to its recoverable amount is recognised as an impairment loss. All intangible HZZL[Z^P[OHUPUKLÄUP[L\ZLM\SSPMLVYPU[HUNPISLHZZL[ZUV[`L[H]HPSHISLMVY\ZLHYL[LZ[LKMVYPTWHPYTLU[HUU\HSS`I`JVTWHYPUN[OLPY carrying amount with their recoverable service amount.

At each reporting date, an assessment is carried out whether there is any indication that an impairment loss recognised in prior periods for an asset may no longer exist or may have decreased. An impairment loss recognised in prior periods for an asset is reversed if there has been a change in the estimates used to determine the asset’s recoverable service amount since the last impairment loss was recognised. The carrying amount of the asset is then increased to its recoverable service amount.

124 125

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

:\TTHY`VMZPNUPÄJHU[HJJV\U[PUNWVSPJPLZJVU[PU\LK

1.9 Financial instruments

-PUHUJPHSHZZL[ZHUKÄUHUJPHSSPHIPSP[PLZHYLYLJVNUPZLKPU[OLZ[H[LTLU[VMÄUHUJPHSWVZP[PVU^OLU0*(:(ILJVTLZHWHY[`[V[OL contractual provisions of the instrument.

0*(:(JSHZZPÄLZP[ZÄUHUJPHSHZZL[ZPU[OLMVSSV^PUNJH[LNVYPLZ!

-PUHUJPHSHZZL[ZH[MHPY]HS\L[OYV\NOWYVÄ[VYSVZZ Held-to-maturity investments, (]HPSHISLMVYZHSLÄUHUJPHSHZZL[Z"HUK Loans and receivables

0*(:(JSHZZPÄLZP[ZÄUHUJPHSSPHIPSP[PLZPU[OLMVSSV^PUNJH[LNVYPLZ!

-PUHUJPHSSPHIPSP[PLZH[MHPY]HS\L[OYV\NOWYVÄ[VYSVZZ"HUK Financial liabilities at amortised cost.

;OLJSHZZPÄJH[PVUVMÄUHUJPHSPUZ[Y\TLU[ZPZKL[LYTPULKH[PUP[PHSYLJVNUP[PVUP[PZIHZLKVU[OLUH[\YLHUKW\YWVZLVMLHJOÄUHUJPHS instrument.

7YPUJPWHSÄUHUJPHSPUZ[Y\TLU[ZJHYYPLKVUYLWVY[PUNKH[LPUJS\KLJHZOHUKJHZOLX\P]HSLU[ZSVHUZHUKV[OLYYLJLP]HISLZÄUHUJL lease liabilities, trade receivables and trade and other payables.

-PUHUJPHSHZZL[ZHYLYLJVNUPZLKHUKKLYLJVNUPZLKVU[YHKLKH[LÔLYL[OLW\YJOHZLVYZHSLVM[OLÄUHUJPHSHZZL[PZ\UKLYHJVU[YHJ[ ÔVZL[LYTZYLX\PYLKLSP]LY`VM[OLPUZ[Y\TLU[^P[OPU[OL[PTLMYHTLLZ[HISPZOLKI`[OLTHYRL[JVUJLYULK(SSÄUHUJPHSHZZL[ZHYL PUP[PHSS`TLHZ\YLKH[MHPY]HS\LPUJS\KPUN[YHUZHJ[PVUJVZ[ZL_JLW[MVY[OVZLÄUHUJPHSHZZL[ZJSHZZPÄLKHZH[MHPY]HS\L[OYV\NOWYVÄ[VY SVZZÔPJOHYLPUP[PHSS`TLHZ\YLKH[MHPY]HS\LL_JS\KPUN[YHUZHJ[PVUJVZ[Z;OLMHPY]HS\LVMHÄUHUJPHSPUZ[Y\TLU[VUPUP[PHSYLJVNUP[PVU is normally the transaction price unless the fair value is evident from observable market data.

(]HPSHISLMVYZHSLÄUHUJPHSHZZL[ZHUKÄUHUJPHSPUZ[Y\TLU[ZH[MHPY]HS\L[OYV\NOWYVÄ[VYSVZZHYLZ\IZLX\LU[S`JHYYPLKH[MHPY]HS\L Loans and receivables and held-to-maturity investments are carried at amortised cost using the effective interest method, less any PTWHPYTLU[.HPUZHUKSVZZLZHYPZPUNMYVTJOHUNLZPU[OLMHPY]HS\LVM[OLÄUHUJPHSPUZ[Y\TLU[ZH[MHPY]HS\L[OYV\NOWYVÄ[VYSVZZ are included in the income statement in the period in which they arise. Gains and losses arising from changes in the fair value of H]HPSHISLMVYZHSLÄUHUJPHSHZZL[ZHYLYLJVNUPZLKKPYLJ[S`PULX\P[`\U[PS[OLÄUHUJPHSHZZL[PZKLYLJVNUPZLKVYPTWHPYLKH[^OPJO time the cumulative gain or loss previously recognised in equity is recognised in the income statement as gains and losses from investment securities. INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

/V^L]LYPU[LYLZ[JHSJ\SH[LKVUH]HPSHISLMVYZHSLÄUHUJPHSHZZL[Z\ZPUN[OLLMMLJ[P]LPU[LYLZ[TL[OVKPZYLJVNUPZLKPU[OLPUJVTL statement as part of interest income.

;OLW\YJOHZLZHUKZHSLZVMÄUHUJPHSPUZ[Y\TLU[Z[OH[YLX\PYLKLSP]LY`^P[OPU[OL[PTLMYHTLLZ[HISPZOLKI`YLN\SH[PVUVYTHYRL[ convention (ordinary purchases and sales) are recognised at settlement date, which is the date the asset is delivered or received. 6[OLY^PZLZ\JO[YHUZHJ[PVUZHYL[YLH[LKHZKLYP]H[P]LZ\U[PSZL[[SLTLU[;OLMHPY]HS\LZVMÄUHUJPHSHZZL[ZX\V[LKPUHJ[P]LTHYRL[Z HYLIHZLKVUJ\YYLU[IPKWYPJLZ;OLMHPY]HS\LZVMÄUHUJPHSSPHIPSP[PLZX\V[LKPUHJ[P]LTHYRL[ZHYLIHZLKVUJ\YYLU[HZRVMMLYWYPJLZ (S[LYUH[P]LS`P[KLYP]LZMHPY]HS\LMYVTJHZOÅV^TVKLSZVYV[OLYHWWYVWYPH[L]HS\H[PVUTVKLSZ^OLYLHUHJ[P]LTHYRL[KVLZUV[L_PZ[ ;OLZLPUJS\KL[OL\ZLVMYLJLU[HYT»ZSLUN[O[YHUZHJ[PVUZKPZJV\U[LKJHZOÅV^HUHS`ZPZVW[PVUWYPJPUNTVKLSZHUKV[OLY]HS\H[PVU techniques commonly used by market participants.

-PUHUJPHSPUZ[Y\TLU[ZH[MHPY]HS\L[OYV\NOWYVÄ[VYSVZZ

;OPZJH[LNVY`OHZ[^VZ\IJH[LNVYPLZ!ÄUHUJPHSPUZ[Y\TLU[ZOLSKMVY[YHKPUNHUK[OVZLKLZPNUH[LKH[MHPY]HS\L[OYV\NOWYVÄ[VYSVZZ at inception.

(ÄUHUJPHSPUZ[Y\TLU[PZJSHZZPÄLKHZOLSKMVY[YHKPUNPMP[PZHJX\PYLKVYPUJ\YYLKWYPUJPWHSS`MVY[OLW\YWVZLVMZLSSPUNVYYLW\YJOHZPUN P[PU[OLULHY[LYT6UPUP[PHSYLJVNUP[PVUP[PZWHY[VMHWVY[MVSPVVMPKLU[PÄLKÄUHUJPHSPUZ[Y\TLU[Z[OH[HYLTHUHNLK[VNL[OLYHUK MVY^OPJO[OLYLPZL]PKLUJLVMHYLJLU[HJ[\HSWH[[LYUVMZOVY[[LYTWYVÄ[[HRPUNVYP[PZHKLYP]H[P]LL_JLW[MVYHKLYP]H[P]L[OH[PZH ÄUHUJPHSN\HYHU[LLJVU[YHJ[VYHKLZPNUH[LKHUKLMMLJ[P]LOLKNPUNPUZ[Y\TLU[

(ÄUHUJPHSPUZ[Y\TLU[PZJSHZZPÄLKKLZPNUH[LKH[MHPY]HS\L[OYV\NOWYVÄ[VYSVZZPM\WVUPUP[PHSYLJVNUP[PVUP[PZKLZPNUH[LKI`[OLLU[P[` HZH[MHPY]HS\L[OYV\NOWYVÄ[VYSVZZ;OLÄUHUJPHSPUZ[Y\TLU[ZHYLJSHZZPÄLK\UKLY[OPZZ\IJH[LNVY`^OLUKVPUNZVYLZ\S[ZPUTVYL relevant information, because either:

0[LSPTPUH[LZVYZPNUPÄJHU[S`YLK\JLZHTLHZ\YLTLU[VYYLJVNUP[PVUPUJVUZPZ[LUJ`ZVTL[PTLZYLMLYYLK[VHZºHUHJJV\U[PUN mismatch’) that would otherwise arise from measuring assets or liabilities or recognising the gains and losses on them on different bases, HNYV\WVMÄUHUJPHSHZZL[ZÄUHUJPHSSPHIPSP[PLZVYIV[OPZTHUHNLKHUKP[ZWLYMVYTHUJLPZL]HS\H[LKVUHMHPY]HS\LIHZPZ in accordance with a documented risk management or investment strategy, and information about the group is provided internally on that basis to the entity’s key management personnel, VYPMHJVU[YHJ[JVU[HPUZVULVYTVYLLTILKKLKKLYP]H[P]LZ[OLLU[PYLOÌYPKJVTIPULKJVU[YHJ[PZKLZPNUH[LKHZHÄUHUJPHS HZZL[VYÄUHUJPHSSPHIPSP[`H[MHPY]HS\L[OYV\NOWYVÄ[VYSVZZ\USLZZ[OLLTILKKLKKLYP]H[P]LZKVLZUV[ZPNUPÄJHU[S`TVKPM` [OLJHZOÅV^Z[OH[V[OLY^PZL^V\SKILYLX\PYLKI`[OLJVU[YHJ["VYP[PZJSLHY^P[OSP[[SLVYUVHUHS`ZPZÔLUHZPTPSHYOÌYPK JVTIPULKPUZ[Y\TLU[PZÄYZ[JVUZPKLYLK[OH[ZLWHYH[PVUVM[OLLTILKKLKKLYP]H[P]LZPZWYVOPIP[LKZ\JOHZHWYLWH`TLU[ option embedded in a loan that permits the holder to prepay the loan for approximately its amortised cost.

126 127

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

:\TTHY`VMZPNUPÄJHU[HJJV\U[PUNWVSPJPLZJVU[PU\LK

1.9 Financial instruments (continued)

/LSK[VTH[\YP[`PU]LZ[TLU[Z

/LSK[VTH[\YP[`PU]LZ[TLU[ZHYLUVUKLYP]H[P]LÄUHUJPHSHZZL[Z^P[OÄ_LKVYKL[LYTPUHISLWH`TLU[ZHUKÄ_LKTH[\YP[`[OH[HULU[P[` OHZ[OLWVZP[P]LPU[LU[PVUHUKHIPSP[`[VOVSK[VTH[\YP[`0*(:(KVLZUV[JSHZZPM`HU`ÄUHUJPHSHZZL[ZHZOLSK[VTH[\YP[`PMP[OHZ K\YPUN[OLJ\YYLU[ÄUHUJPHS`LHYVYK\YPUN[OL[^VWYLJLKPUNÄUHUJPHS`LHYZZVSKVYYLJSHZZPÄLKTVYL[OHUHUPUZPNUPÄJHU[HTV\U[ VMOLSK[VTH[\YP[`PU]LZ[TLU[ZILMVYLTH[\YP[`TVYL[OHUPUZPNUPÄJHU[PUYLSH[PVU[V[OL[V[HSHTV\U[VMOLSK[VTH[\YP[`PU]LZ[TLU[Z V[OLY[OHUZHSLZVYYLJSHZZPÄJH[PVUZ[OH[HYLZVJSVZL[VTH[\YP[`VY[OLÄUHUJPHSHZZL[»ZJHSSKH[L[OH[JOHUNLZPU[OLTHYRL[YH[LVM PU[LYLZ[^V\SKUV[OH]LHZPNUPÄJHU[LMMLJ[VU[OLÄUHUJPHSHZZL[»ZMHPY]HS\LVJJ\YHM[LY[OLLU[P[`OHZJVSSLJ[LKZ\IZ[HU[PHSS`HSSVM [OLÄUHUJPHSHZZL[»ZVYPNPUHSWYPUJPWHS[OYV\NOZJOLK\SLKWH`TLU[ZVYWYLWH`TLU[ZVYHYLH[[YPI\[HISL[VHUPZVSH[LKL]LU[[OH[PZ beyond the entity’s control, is non-recurring and could not have been reasonably anticipated by the entity.

Held-to-maturity investments are subsequently measured at amortised cost using the effective interest rate method less any PTWHPYTLU[SVZZ0U[LYLZ[PUJVTLPZYLJVNUPZLKPUWYVÄ[VYSVZZI`HWWS`PUN[OLLMMLJ[P]LPU[LYLZ[YH[L

(]HPSHISLMVYZHSLÄUHUJPHSHZZL[Z

(]HPSHISL MVY ZHSL ÄUHUJPHS HZZL[Z HYL [OVZL UVUKLYP]H[P]L ÄUHUJPHS HZZL[Z [OH[ HYL KLZPNUH[LK HZ H]HPSHISLMVYZHSL VY HYL UV[ JSHZZPÄLKHZSVHUZHUKYLJLP]HISLZOLSK[VTH[\YP[`PU]LZ[TLU[ZVYÄUHUJPHSHZZL[ZH[MHPY]HS\L[OYV\NOWYVÄ[VYSVZZ

;OLUL[NHPUVYSVZZYLJVNUPZLKPUWYVÄ[VYSVZZPUJVYWVYH[LZHU`NHPUZVYSVZZLZVUYLTLHZ\YLTLU[[YHUZMLYYLKMYVTLX\P[`[V WYVÄ[VYSVZZKP]PKLUKZHUKPU[LYLZ[PUJVTLVU[OLÄUHUJPHSHZZL[;OLZLPU]LZ[TLU[ZHYLJSHZZPÄLKHZUVUJ\YYLU[HZZL[Z\USLZZ management intends to dispose of the investments within twelve months of the balance sheet date.

3VHUZHUKYLJLP]HISLZ

3VHUZHUKYLJLP]HISLZHYLUVUKLYP]H[P]LÄUHUJPHSHZZL[Z^P[OÄ_LKVYKL[LYTPUHISLWH`TLU[Z[OH[HYLUV[X\V[LKPUHUHJ[P]L THYRL[V[OLY[OHU[OVZL[OH[[OLLU[P[`PU[LUKZ[VZLSSPTTLKPH[LS`VYPU[OLULHY[LYT^OPJOHYLJSHZZPÄLKHZOLSKMVY[YHKPUN HUK[OVZL[OH[[OLLU[P[`\WVUPUP[PHSYLJVNUP[PVUKLZPNUH[LZHZH[MHPY]HS\L[OYV\NOWYVÄ[VYSVZZ"[OVZL[OH[[OLLU[P[`\WVUPUP[PHS recognition designates as available for sale; or those for which the holder may not recover substantially all of its initial investment, V[OLY[OHUILJH\ZLVMJYLKP[KL[LYPVYH[PVU^OPJOZOHSSILJSHZZPÄLKHZH]HPSHISLMVYZHSL INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

Loans and receivables are subsequently measured at amortised cost using the effective interest rate method less any impairment SVZZ0U[LYLZ[PUJVTLPZYLJVNUPZLKPUWYVÄ[VYSVZZI`HWWS`PUN[OLLMMLJ[P]LPU[LYLZ[YH[LL_JLW[MVYZOVY[[LYT[YHKLYLJLP]HISLZ^OLYL the recognition of interest would be immaterial. Trade receivables are carried at original invoice amount less any impairment loss.

*HZOHUKJHZOLX\P]HSLU[Z

Cash and cash equivalents comprise cash on hand and demand deposits, together with short-term, highly liquid investments of a maturity of three months or less from the date of acquisition that are readily convertible to a known amount of cash and that are Z\IQLJ[[VHUPUZPNUPÄJHU[YPZRVMJOHUNLZPU]HS\L)HURV]LYKYHM[ZHYLZOV^U^P[OPUZOVY[[LYTIVYYV^PUNZPUJ\YYLU[SPHIPSP[PLZVU [OLZ[H[LTLU[VMÄUHUJPHSWVZP[PVU*HZOHUKJHZOLX\P]HSLU[ZPU[OLJHZOÅV^Z[H[LTLU[HUKPU[OLWYLZLU[H[PVUVMUL[KLI[HYL YLÅLJ[LKUL[VMV]LYKYHM[Z

*HZOVUOHUKPZPUP[PHSS`YLJVNUPZLKH[MHPY]HS\LHUKZ\IZLX\LU[S`TLHZ\YLKH[P[ZMHJL]HS\L+LWVZP[ZOLSKVUJHSSHYLJSHZZPÄLK as loans and receivables by the Authority and carried at amortised cost. Due to the short-term nature of these, the amortised cost normally approximates its fair value.

;YHKLHUKV[OLYYLJLP]HISLZ

Trade and other receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for impairment of trade receivables is established when there is objective L]PKLUJL[OH[[OL(\[OVYP[`^PSSUV[ILHISL[VJVSSLJ[HSSHTV\U[ZK\LHJJVYKPUN[V[OLVYPNPUHS[LYTZVMYLJLP]HISLZ:PNUPÄJHU[ ÄUHUJPHSKPMÄJ\S[PLZVM[OLKLI[VYHUKKLMH\S[VYKLSPUX\LUJ`PUWH`TLU[ZHYLJVUZPKLYLKPUKPJH[VYZ[OH[[OL[YHKLYLJLP]HISLPZ impaired. The amount of the provision is the difference between the asset’s carrying amount and the present value of estimated M\[\YLJHZOÅV^ZKPZJV\U[LKH[[OLVYPNPUHSLMMLJ[P]LPU[LYLZ[YH[L;OLHTV\U[VM[OLWYV]PZPVUPZYLJVNUPZLKPU[OLZ[H[LTLU[VM ÄUHUJPHSWLYMVYTHUJL^P[OPUºVWLYH[PVUHSL_WLUKP[\YL»

;YHKLHUKV[OLYWH`HISLZ

Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method.

+LYLJVNUP[PVUVMÄUHUJPHSPUZ[Y\TLU[Z

;OLÄUHUJPHSHZZL[ZHYLKLYLJVNUPZLKÔLU[OLJVU[YHJ[\HSYPNO[Z[V[OLHZZL[L_WPYLZ"VYÔLYL[OLYLPZH[YHUZMLYVM[OLJVU[YHJ[\HS YPNO[Z[VYLJLP]L[OLJHZOÅV^ZVM[OLÄUHUJPHSHZZL[HUKZ\IZ[HU[PHSS`HSSVM[OLYPZRZHUKYL^HYKZYLSH[LK[V[OLVÛLYZOPWVM[OL ÄUHUJPHSHZZL[HYL[YHUZMLYYLK"VY0*(:(YL[HPUZ[OLJVU[YHJ[\HSYPNO[ZVM[OLHZZL[ZI\[HZZ\TLZHJVYYLZWVUKPUNSPHIPSP[`[V[YHUZMLY [OLZLJVU[YHJ[\HSYPNO[Z[VHUV[OLYWHY[`HUKJVUZLX\LU[S`[YHUZMLYZZ\IZ[HU[PHSS`HSS[OLYPZRZHUKILULÄ[ZHZZVJPH[LK^P[O[OLHZZL[

128 129

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

:\TTHY`VMZPNUPÄJHU[HJJV\U[PUNWVSPJPLZJVU[PU\LK

1.9 Financial instruments (continued)

+LYLJVNUP[PVUVMÄUHUJPHSPUZ[Y\TLU[ZJVU[PU\LK

If a transfer does not result in derecognition because ICASA has retained substantially all the risks and rewards of ownership of [OL[YHUZMLYYLKHZZL[0*(:(JVU[PU\LZ[VYLJVNUPZL[OL[YHUZMLYYLKHZZL[PUP[ZLU[PYL[`HUKYLJVNUPZLZHÄUHUJPHSSPHIPSP[`MVY[OL consideration received. In subsequent periods, ICASA recognises any income on the transferred asset and any expense incurred VU[OLÄUHUJPHSSPHIPSP[`

-PUHUJPHSSPHIPSP[PLZVYHWVY[PVU[OLYLVMHYLKLYLJVNUPZLK^OLU[OLVISPNH[PVUZWLJPÄLKPU[OLJVU[YHJ[PZKPZJOHYNLKJHUJLSSLKVY L_WPYLK6UKLYLJVNUP[PVU[OLKPMMLYLUJLIL[^LLU[OLJHYY`PUNHTV\U[VM[OLÄUHUJPHSSPHIPSP[`PUJS\KPUNYLSH[LK\UHTVY[PZLKJVZ[Z HUKZL[[SLTLU[HTV\U[ZWHPKHYLPUJS\KLKPUWYVÄ[VYSVZZ

1.10 Leases

3LHZLZHYLJSHZZPÄLKHZÄUHUJLSLHZLZ^OLUL]LY[OL[LYTZVM[OLSLHZL[YHUZMLYZ\IZ[HU[PHSS`HSSVM[OLYPZRZHUKYL^HYKZVMV^ULYZOPW [V[OLSLZZLL(SSV[OLYSLHZLZHYLJSHZZPÄLKHZVWLYH[PUNSLHZLZ6WLYH[PUNSLHZLWH`TLU[ZHYLYLJVNUPZLKHZHUL_WLUZLVUH Z[YHPNO[SPULIHZPZV]LY[OLSLHZLWLYPVK4PUPT\TYLU[HSZ[OH[MHSSK\LHM[LY[OLLUKVM[OLYLWVY[PUNWLYPVKHYLYLÅLJ[LK\UKLY commitments.

When an operating lease is terminated before the lease period has expired, any penalty incurred as a result is recognised as an expense in the period in which termination occurs.

(ZZL[ZOLSK\UKLYÄUHUJLSLHZLZHYLYLJVNUPZLKHZHZZL[ZVUPUJLW[PVUVM[OLSLHZLH[[OLSV^LYVMMHPY]HS\LVY[OLWYLZLU[]HS\L of the minimum lease payments derived by discounting at the interest rate implicit in the lease. The interest element of the rental is JOHYNLKHNHPUZ[WYVÄ[ZVHZ[VWYVK\JLHJVUZ[HU[`LHYS`YH[LVMPU[LYLZ[VU[OLYLTHPUPUNIHSHUJLVM[OLSPHIPSP[`\USLZZP[PZKPYLJ[S` attributable to qualifying assets, in which case it is capitalised in accordance with the general policy on borrowing costs. The leased assets that qualify for recognition as assets are depreciated over their estimated useful lives in accordance with ICASA’s policy on property, plant and equipment.

1.11 Prepayments

Prepayments are recognised when ICASA has made a payment in advance in terms of the contractual obligations which result in the decrease of liabilities or increase in expense or increase in assets in the future periods. INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

1.12 Provisions

Provisions are recognised when the Authority has a present legal or constructive obligation as a result of past events when it is WYVIHISL[OH[HUV\[ÅV^VMYLZV\YJLZLTIVK`PUNLJVUVTPJILULÄ[ZVYZLY]PJLWV[LU[PHS^PSSILYLX\PYLK[VZL[[SL[OLVISPNH[PVUHUK a reliable estimate of the amount of the obligation can be made. Provisions are measured at the present value of the expenditure L_WLJ[LK[VILYLX\PYLK[VZL[[SL[OLVISPNH[PVU\ZPUNHYH[L[OH[YLÅLJ[ZJ\YYLU[THYRL[HZZLZZTLU[ZVM[OL[PTL]HS\LVMTVUL`HUK [OLYPZRZZWLJPÄJ[V[OLVISPNH[PVU3VUN[LYTWYV]PZPVUZHYLKPZJV\U[LK[VUL[WYLZLU[]HS\L;OLPUJYLHZLPU[OLWYV]PZPVUK\L[V passage of time is recognised as interest expense.

,TWSV`LLILULÄ[Z

9L[PYLTLU[ILULÄ[Z

;OL(\[OVYP[`VWLYH[LZKLÄULKJVU[YPI\[PVUWSHUZ[OLHZZL[ZVM^OPJOHYLOLSKPU[Y\Z[LLHKTPUPZ[LYLKM\UKZ7LUZPVUILULÄ[ZHYL THPUS`WYV]PKLKI`TLTILYZOPWVM[OL.V]LYUTLU[,TWSV`LLZ7LUZPVU-\UK.,7-*VU[YPI\[PVUZ[V[OLKLÄULKJVU[YPI\[PVU plans in respect of service in a particular period are included in the employees’ total cost of employment and are charged to the Z[H[LTLU[VMÄUHUJPHSWLYMVYTHUJLPU[OL`LHY[V^OPJO[OL`YLSH[LHZWHY[VM[OLJVZ[VMLTWSV`TLU[

;OL(\[OVYP[`OHZUVSLNHSVYJVUZ[Y\J[P]LVISPNH[PVU[VWH`M\Y[OLYJVU[YPI\[PVUZPM[OL.,7-KVLZUV[OVSKZ\MÄJPLU[HZZL[Z[VWH` HSSLTWSV`LLZ[OLILULÄ[ZYLSH[PUN[VLTWSV`LLZLY]PJLPU[OLJ\YYLU[HUKWYPVYWLYPVKZ

;LYTPUH[PVUILULÄ[Z

;LYTPUH[PVUILULÄ[ZHYLYLJVNUPZLKHZHSPHIPSP[`PU[OLIHSHUJLZOLL[HUKHZHUL_WLUZLPU[OLPUJVTLZ[H[LTLU[^OLU0*(:(OHZ a present obligation relating to termination. ICASA has a present obligation when it is demonstrably committed to either terminating the employment of current employees according to a detailed formal plan, without possibility of withdrawal or providing termination ILULÄ[ZHZHYLZ\S[VMHUVMMLY[VLUJV\YHNL]VS\U[HY`YLK\UKHUJ`

:OVY[[LYTLTWSV`LLILULÄ[Z

:OVY[[LYTLTWSV`LLILULÄ[VISPNH[PVUZPUJS\KPUN[OLN\HYHU[LLKIVU\ZHUKSLH]LKH`ZHJJY\LKHYLTLHZ\YLKVUHU\UKPZJV\U[LK basis and are expensed as and when the related service is provided by the employees. A liability is recognised for the amount L_WLJ[LK[VILWHPK\UKLYZOVY[[LYTLTWSV`LLILULÄ[PM[OL(\[OVYP[`OHZHWYLZLU[SLNHSVYJVUZ[Y\J[P]LVISPNH[PVUHZHYLZ\S[VM past service provided by the employee and the obligation can be estimated reliably.

130 131

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

:\TTHY`VMZPNUPÄJHU[HJJV\U[PUNWVSPJPLZJVU[PU\LK

,TWSV`LLILULÄ[ZJVU[PU\LK

3VUN[LYTLTWSV`LLILULÄ[Z

The Authority provides long-term service awards to all employees who have served the Authority for a period of 5, 10, 15, 20, 25, HUK`LHYZHUKHIV]L;OLLTWSV`LLZHYLLU[P[SLK[VHJLY[PÄJH[LHUKTVUL[HY`H^HYKPUYLZWLJ[VMLHJOSVUN[LYTWLYPVK served. The monetary award varies with period the employee has served the Authority for.

1.14 Administered Revenue on behalf of the National Revenue Fund

In terms of section 15(3) of the Independent Communication Authority of South Africa Act (Act No. 13 of 2000), the Authority is required to pay all fees received and held on their behalf to the NRF within 30 days after receipt of such revenue.

Separate bank accounts are held for the purpose of collecting these revenues and paying them across to the NRF. The Authority has an obligation in terms of statute to administer these funds on behalf of National Treasury and to pay them across within a prescribed time limit.

1.15 Finance income

0UHJJVYKHUJL^P[OH5H[PVUHS;YLHZ\Y`JVTT\UPJH[PVUKH[LK1\S`HSSÄUHUJLPUJVTLLHYULKVUZ\YWS\ZM\UKZHUKM\UKZ collected on behalf of the National Revenue Fund during the year is recognised as revenue on a time proportion basis using effective interest method.

1.16 Taxation

The Authority is exempted in terms of section 10(1) (cA) (1) of the Income Tax Act 1962 (Act No. 58 of 1962).

1.17 Borrowing costs

0U[LYLZ[VUIVYYV^PUNZKPYLJ[S`YLSH[PUN[V[OLÄUHUJPUNVMX\HSPM`PUNJHWP[HSWYVQLJ[Z\UKLYJVUZ[Y\J[PVUPZHKKLK[V[OLJHWP[HSPZLK cost of those projects during the construction phase, until such time as the assets are substantially ready for their intended use or ZHSL>OLYLM\UKZOH]LILLUIVYYV^LKZWLJPÄJHSS`[VÄUHUJLHWYVQLJ[[OLHTV\U[JHWP[HSPZLKYLWYLZLU[Z[OLHJ[\HSIVYYV^PUN JVZ[ZPUJ\YYLK>OLYL[OLM\UKZ\ZLK[VÄUHUJLHWYVQLJ[MVYTWHY[VMNLULYHSIVYYV^PUNZ[OLHTV\U[JHWP[HSPZLKPZJHSJ\SH[LK using a weighted average of rates applicable to relevant general borrowings of ICASA during the construction period. INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

1.18 Contingent liabilities, contingent assets and commitments

(JVU[PUNLU[SPHIPSP[`PZHWVZZPISLVISPNH[PVU[OH[HYPZLZMYVTWHZ[L]LU[ZHUKÔVZLL_PZ[LUJL^PSSILJVUÄYTLKVUSÌ`[OLVJJ\YYLUJL or non-occurrence of one or more uncertain future events not wholly within the control of the Authority or a present obligation that HYPZLZMYVTWHZ[L]LU[ZI\[PZUV[YLJVNUPZLKILJH\ZLP[PZUV[WYVIHISL[OH[HUV\[ÅV^VMYLZV\YJLZLTIVK`PUNLJVUVTPJILULÄ[Z ^PSSILYLX\PYLK[VZL[[SL[OLVISPNH[PVUVY[OLHTV\U[VM[OLVISPNH[PVUJHUUV[ILTLHZ\YLK^P[OZ\MÄJPLU[YLSPHIPSP[`0[LTZHYL JSHZZPÄLKHZJVTTP[TLU[ZÔLYL[OL(\[OVYP[`JVTTP[ZP[ZLSM[VM\[\YL[YHUZHJ[PVUZWHY[PJ\SHYS`PU[OLHJX\PZP[PVUVMWYVWLY[`WSHU[ and equipment and intangible assets.

1.19 Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions.

Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement, except when KLMLYYLKPULX\P[`HZX\HSPM`PUNJHZOÅV^OLKNLZHUKX\HSPM`PUNUL[PU]LZ[TLU[OLKNLZ

Translation differences on non-monetary items are reported as part of the fair value gain or loss. Foreign currency translation KPMMLYLUJLZVUTVUL[HY`P[LTZJSHZZPÄLKHZH]HPSHISLMVYZHSLHYLUV[YLWVY[LKHZWHY[VM[OLMHPY]HS\LNHPUVYSVZZPUUL[HZZL[ZI\[ HYLYLJVNUPZLKHZH[YHUZSH[PVUNHPUVYSVZZPU[OLZ[H[LTLU[VMÄUHUJPHSWLYMVYTHUJL^OLUPUJ\YYLK

;YHUZSH[PVUKPMMLYLUJLZVUUVUTVUL[HY`P[LTZJSHZZPÄLKHZH]HPSHISLMVYZHSLHYLPUJS\KLKPU[OLMHPY]HS\LYLZLY]LPUUL[HZZL[Z when incurred.

1.20 Irregular, Fruitless and Wasteful Expenditure

Fruitless and wasteful expenditure means expenditure that was made in vain and would have been avoided had reasonable care been exercised. Irregular expenditure means expenditure incurred in contravention of or not in accordance with a requirement of any applicable legislation including:

- The Public Finance Management Act (PFMA) - Regulations issued in terms of the PFMA by National Treasury.

All irregular, fruitless and wasteful expenditure is charged against revenue in the period in which it is incurred.

132 133

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

:\TTHY`VMZPNUPÄJHU[HJJV\U[PUNWVSPJPLZJVU[PU\LK

1.21 Related parties

The Authority will disclose all related party relationships, related party transactions and the relationship underlying those transactions. Related parties include national and public entities in the national sphere of government, key management, individual employees owning directly or indirectly an interest in the entity that has transaction or business related interest in ICASA and close members VM[OLMHTPS`VMHU`Z\JOPUKP]PK\HS^OVTH`ILL_WLJ[LK[VPUÅ\LUJLVYILPUÅ\LUJLKI`[OH[WLYZVUPU[OLPYKLHSPUN^P[O[OL Authority.

Only transactions with related parties that are not conducted on an arm’s length basis or not in the ordinary course of business are disclosed.

1.22 Revenue from non-exchange transactions

Revenue from non-exchange transactions relates to all revenue transactions where ICASA receives value from another entity without directly giving approximately equal value in exchange. Revenue from non-exchange transactions is generally recognised to the L_[LU[[OH[[OLYLSH[LKYLJLPW[VYYLJLP]HISLX\HSPÄLZMVYYLJVNUP[PVUHZHUHZZL[HUK[OLYLPZUVSPHIPSP[`[VYLWH`[OLHTV\U[

1.23 Revenue from exchange transactions

Revenue from exchange transactions relates to all revenue transactions where ICASA receives value from another entity after directly giving approximately equal value in exchange

9L]LU\LMYVT[OLZHSLVMNVVKZPZYLJVNUPZLK^OLU0*(:(OHZ[YHUZMLYYLK[V[OLW\YJOHZLY[OLZPNUPÄJHU[YPZRZHUKYL^HYKZVM ownership of the goods; ICASA retains neither continuing managerial involvement to the degree usually associated with ownership UVYLMMLJ[P]LJVU[YVSV]LY[OLNVVKZZVSK"[OLHTV\U[VMYL]LU\LJHUILTLHZ\YLKYLSPHIS`"P[PZWYVIHISL[OH[[OLLJVUVTPJILULÄ[Z VYZLY]PJLWV[LU[PHSHZZVJPH[LK^P[O[OL[YHUZHJ[PVU^PSSÅV^[V[OLLU[P[`HUK[OLJVZ[ZPUJ\YYLKVY[VILPUJ\YYLKPUYLZWLJ[VM[OL transaction can be measured reliably.

Revenue from rendering of services is recognised when the outcome of a transaction involving the rendering of services can be estimated reliably. Revenue from rendering of services is recognised by reference to the stage of completion of the transaction at the reporting date. The outcome of a transaction can be estimated reliably when the amount of revenue can be measured reliably; P[PZWYVIHISL[OH[[OLLJVUVTPJILULÄ[ZVYZLY]PJLWV[LU[PHSHZZVJPH[LK^P[O[OL[YHUZHJ[PVU^PSSÅV^[V[OLLU[P[`"[OLZ[HNLVM completion of the transaction at the reporting date can be measured reliably; the costs incurred for the transaction and the costs to complete the transaction can be measured reliably. INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

Interest income is recognised using the effective interest rate method. Royalties are recognised as they are earned in accordance with the substance of the relevant agreement. Dividends or similar distributions are recognised when ICASA’s right to receive payment is established.

1.24 Comparatives

>OLYLULJLZZHY`[OLJVTWHYH[P]LZOH]LILLUYLZ[H[LK[VJVUMVYT[VJOHUNLZPU[OLWYLZLU[H[PVUPU[OLJ\YYLU[ÄUHUJPHS`LHY

1.25 Use of estimates and judgments

The General Licence Fee Regulations stipulate that the licensees must submit and pay their licence fees six month after the end VM[OLPYÄUHUJPHS`LHY>OLU[OLZ\ITPZZPVUHUKWH`TLU[KH[LPZUV[K\LI\[[OLSPJLUZLLOHZNLULYH[LK[OLYL]LU\L\W[V[OL reporting date of the Authority the Authority will use the estimated amount supplied by the licensee or the amount which was due IHZLKVU[OLSH[LZ[ÄUHUJPHSZ[H[LTLU[ZVM[OLSPJLUJL

The performance bonus is estimated on average one of monthly salary and limited to the available funds as approved by the (JJV\U[PUN6MÄJLY;OL(JJV\U[PUN6MÄJLYHWWYV]LZ[OLWYV]PZPVUMVYWLYMVYTHUJLIVU\ZLZ

Impairment of licence fee: If the licensee fees are long outstanding and there is an indication that the licensee will not pay or there is history of continuous non-payment the Authority makes a provision for that.

1.26 Budget Information

The Authority prepares the budget that covers a three year period and this is prepared on the accrual basis. The Portfolio Committee on Communications approves the budget for one year only. The budget reviews is performed periodically and Council approves all budget reviews. Virements are approved in terms of the delegation of authority.

134 135

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 (J[\HS 9LZ[H[LK 9L]LU\LMYVTUVUL_JOHUNL[YHUZHJ[PVUZ

Original allocation from Department of Communications (“DoC”) Budget vote 269 607 000 Insurance claim settlements 598 869 270 205 869

ICASA receives its funding from the Department of Communications in order to enable it to carry out its mandate as laid out in the ICASA Act.

7YPVYWLYPVKLYYVYZ

9L[YVZWLJ[P]LJHSJ\SH[PVUVMKLWYLJPH[PVUHUKHTVY[PZH[PVUVUHZZL[Z^P[OL_[LUKLK\ZLM\SSP]LZ

4HYJO

+\YPUN[OLJ\YYLU[ÄUHUJPHS`LHY^LPKLU[PÄLK[OH[[OLÄUHUJPHSZ`Z[LT^HZJHSJ\SH[PUNKLWYLJPH[PVUHUKHTVY[PZH[PVUVUHZZL[Z^P[O extended useful lives retrospectively. The effect of the error was as follows:

Increase in depreciation 10 599 906 Increase in amortisation 381 215 0UJYLHZLPUKLÄJP[MVY[OLWLYPVK (10 981 121)

Decrease in net carrying of property, plant and equipment (10 599 906) Decrease in net carrying of intangible assets (381 215) Decrease in accumulated surplus (10 981 121) INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 5V[L (J[\HS 9LZ[H[LK *VTTP[TLU[Z

In the previous year, the Authority did not have a system of recognising commitments resulting in an error in the amount included in [OLHUU\HSÄUHUJPHSZ[H[LTLU[Z

4HYJO Decrease in commitments (9 124 065)

4HYJO Decrease in commitments (9 781 864)

9L]LU\LMYVTL_JOHUNL[YHUZHJ[PVUZ

Finance income 15 177 219 Bid handling fee 4 500

Other 46 438 15 228 157 (KTPUPZ[YH[P]LL_WLUZLZ

General and administrative expenses 1 499 206 Travel and subsistence 9 682 216 5L[MVYLPNUL_JOHUNLKLÄJP[Z 7 081 Insurance 811 773 Printing and stationery 2 549 935 Publications 1 669 514 Publicity and advertising 4 498 860 Recruitment costs 1 516 166 Telephone, postage and fax 6 173 126 Training and conferences 7 848 047

36 255 924

136 137

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 5V[L (J[\HS 9LZ[H[LK :[HMMJVZ[Z

Council’s, Executive Management’s and Committees’ remuneration 7 17 349 381 Salaries and wages 132 617 626 - Salaries 100 192 436 - Performance awards 7 370 734 - Periodic payments 7 077 496 - Temporary staff 238 539 - Leave expenses 2 325 165 - Overtime pay 1 131 456 +LÄULKJVU[YPI\[PVUWSHUL_WLUZL 14 281 800 Social contributions (Employer’s contribution) 8 290 374 - Medical aid 7 336 977 - UIF 590 572 - Workman’s compensation 362 825 - Long-service awards 783 000 159 040 381 - - - - 551 097 551 934 870 934 870 934 870 934 870 934 870 934 870 934 870 934 870 230 264 1 221 575 1 221 8 547 026 8 547 *R Actual 31 March31 2010 9LT\ULYH[PVU 9 (J[\HS 4HYJO U as it appears in the Government Gazette due to the Councillor Councillor the to due Gazette Government the in appears it as +H[LVM9LZPNUH[PVU ,UKVM;LYT +H[L and they do not receive performance bonuses performance bonuses receive not do they and *V\UJPS *VTTLUJLTLU[ SS MncubeSS 01/07/2010 P Mashile 01/07/2005 30/06/2010 R Nkuna 18/10/2006 30/09/20/10 BB NtombelaBB JCW Rooyen Van SC 01/01/2007 01/11/2006 30/09/2010 30/09/2010 MM SocikwaMM 01/04/2007 M Zokwe 01/07/2005 30/06/2009 NA BatyiNA 04/08/2008 TLV MakhakheTLV 10/07/2008 FK SibandaFK 01/10/2008 WF StuckeWF CurrieWH 30/11/2009 01/10/2010 N NdhlovuN LebooaJM 01/11/2010 01/10/2010 TOTALS NOTES TO THE FINANCIAL STATEMENTS THE FINANCIAL TO NOTES for the year ended March 2011 31 *V\UJPS»Z,_LJ\[P]L4HUHNLTLU[»ZHUK*VTTP[[LLZ»YLT\ULYH[PV Details of remuneration paid are as follows: INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA SOUTH OF AUTHORITY COMMUNICATIONS INDEPENDENT OH]PUN[VÄUHSPZLOPZOLYJ\YYLU[LTWSV`TLU[HYYHUNLTLU[Z 6YHU`ILULÄ[IL`VUKJVZ[[V[OLJVTWHU` date appointment Councillor’s a vary to may date Commencement ** *Council remuneration is at cost to company company to cost at is remuneration *Council

138 139 R 817 293 817 817 293 817 817 293 817 293 817 293 817 293 817 828 180 828 263 358 TOTAL 8 372 463 8 372 1 544 237 - - - 27 218 27 218 27 218 27 218 27 218 27 218 38 105 38 R 201 413 201 Actual Bonus Performance 31 March31 2010 -- R 790 075 790 075 790 075 790 075 790 075 790 075 790 075 263 358 832 930832 930 832 Salary 8 171 050 8 171 1 544 237 9 ;6;(3 9 )VU\Z 7LYMVYTHUJL (J[\HS 9 FRQWLQXHG (J[PUN (SSV^HUJL 9 :HSHY` ;P[SL 4HYJO and Audit Compliance Technology Competition Competition +H[L (WWVPU[LK ,_LJ\[P]L 4HUHNLTLU[ T Mosia 06/11/2006 CFO M MopeliM 08/01/2007 Resources Human GM: S MamareganeS 01/04/1999 CCC and Legal GM: S TsotetsiP Mashangoane 05/06/2006 01/07/2007 GM: LicensingD Ngwenya and Consumer GM: Affairs 01/08/2007 NtuliBL GM: Engineering and 01/11/2008 Administration GM: *K Weeks 03/03/2008 Markets GM: and Total PB Grootes 01/10/2010 GM: Markets and BG JoosteBG 01/11/2008 Risk Compliance, GM: TTC DlaminiTTC 01/11/2010 CEO **BK Motlana 03/09/2007 CEO INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA SOUTH OF AUTHORITY COMMUNICATIONS INDEPENDENT ** contract Mr BK Motlana’s ended on 31/08/2010 * Mr K Weeks resigned on 31/07/2009 Executive remuneration is at cost company to and they receive performance bonuses only in addition the cost to company to NOTES TO THE FINANCIAL STATEMENTS THE FINANCIAL TO NOTES for the year ended March 2011 31 &RXQFLOâV([HFXWLYH0DQDJHPHQWâVDQG&RPPLWWHHVâUHPXQHUDWLRQ Management Executive Permanent INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 5V[L (J[\HS 9LZ[H[LK *V\UJPS»Z,_LJ\[P]L4HUHNLTLU[»ZHUK*VTTP[[LLZ»YLT\ULYH[PVUJVU[PU\LK (<+0;(5+90:2*6440;;,, 4LL[PUNZ 5VYTHS :WLJPHS ;LJOUPJHS S Swana - Chairperson 6 41 47 264 RA Kenosi 9 65 30 992 TZ Gcabashe 9 74 46 488 TT Ratsheko 8 22 3 874 T Sihlaba 8 52 - 128 618

*6473(05;:(5+*64730(5*,*6440;;,, 4LL[PUNZ

5VYTHS 1\KNLTLU[Z

2,4VSV[V:[VÄSL -- 61 600 N Ntanjana 31 - 24 000 S Thakur 17 - 20 800 MT Matshoba (Ramuedzisi) 20 - 22 400 IWB de Villiers 18 30 hrs 105 000 JCW van Rooyen 12 72 hrs - PA Delport 5 15 hrs - EZ Ntukwana 21 - - LJ Tlokana 23 - - 233 800

140 141

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 5V[L (J[\HS 9LZ[H[LK

9,4<5,9(;065*6440;;,, 4LL[PUNZ 5VYTHS :WLJPHS X Hloma 4 2 2 745 S Faku 4 - 2 745 5 490

05-694(;065;,*/5636.@9,=0,>*6440;;,,0; 4LL[PUNZ 5VYTHS :WLJPHS P Cronje 3 1 30 992 C Pillay 3 1 30 992 61 984

;V[HSYLT\ULYH[PVUMVY*VTTP[[LLZ 429 892

:\TTHY`VM*V\UJPS»Z,_LJ\[P]L4HUHNLTLU[»ZHUK*VTTP[[LLZ»YLT\ULYH[PVU Council 8 547 026 Executive Management 8 372 463 Committees 429 892 17 349 381

(\KP[MLLZ

- Internal audit - - External audit 1 602 727 1 602 727 INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 5V[L (J[\HS 9LZ[H[LK 6[OLYVWLYH[PUNL_WLUZLZ

Consultants, contractors and special services 21 933 869 Equipment items expensed 244 492 Legal fees 8 430 063 Maintenance repairs and running costs - Property and buildings 286 436 - Machinery and equipment 1 917 121 - Motor vehicles 1 847 165 - Other maintenance and repairs 2 339 540 Information technology 4 355 941 Transaction costs charges 1 240 079 Rental in respect of operating leases and other related expenses - Rental of buildings 31 693 324 - Lights and water 1 252 554 - Rates and taxes 1 223 136 - Garden maintenance 79 373 6MÄJLJSLHUPUN 1 025 572 - Security costs 2 253 749 - Equipment 557 700 +LÄJP[VUKPZWVZHSVMWYVWLY[`WSHU[HUKLX\PWTLU[ 1 155 833 Regulatory associations and conferences 1 608 874 Other 1 765 756 Impairment loss 423 045 85 633 622 -PUHUJLJVZ[Z

0U[LYLZ[L_WLUZLWHPKVUÄUHUJLSLHZLZ 3 343 Interest – other 2 491 5 834

142 143

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 5V[L (J[\HS 9LZ[H[LK -Y\P[SLZZ^HZ[LM\SHUKPYYLN\SHYL_WLUKP[\YL

;OLYLJVUJPSPH[PVUVM[OLIHSHUJLVMMY\P[SLZZHUK^HZ[LM\SL_WLUKP[\YLPZHZMVSSV^Z! Opening balance 39 570 Current year movements 2 491 Amounts condoned - - Amounts transferred to accounts receivable - 42 061

;OLHTV\U[VM9 ^HZJVUKVULKPU[OLJ\YYLU[ÄUHUJPHS`LHY^OPSLHUHTV\U[VM9 YLSH[PUN[V[OL ^HZ JVUKVULKHM[LY[OLLUKVM[OL ÄUHUJPHS`LHY

;OLYLJVUJPSPH[PVUVM[OLPYYLN\SHYL_WLUKP[\YLIHSHUJLH[[OLLUKVM[OLÄUHUJPHS`LHYPZHZMVSSV^Z!

Opening balance 387 081 Current year movements 268 546 Amounts condoned - 655 627

0UJS\KLKPUL_WLUKP[\YLWLY[OLZ[H[LTLU[VMÄUHUJPHSWLYMVYTHUJLPZ[OLMVSSV^PUN!

-Y\P[SLZZHUK^HZ[LM\SL_WLUKP[\YL Payment of a Councillor not performing his judiciary duties - Interest costs 2 491 2 491 INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 5V[L (J[\HS 9LZ[H[LK -Y\P[SLZZ^HZ[LM\SHUKPYYLN\SHYL_WLUKP[\YLJVU[PU\LK

0YYLN\SHYL_WLUKP[\YL

Technical equipment 4 600 Postage costs 18 069 Payroll costs 115 439 Courier services costs 15 669 Library costs 5 184 Security costs - IT costs 109 585 Operating lease costs - Consultants - Training costs - 268 546

0U[LYLZ[JVZ[Z

0U[LYLZ[JOHYNLKVUSH[LWH`TLU[MVY9LNPVUHS6MÄJLZ!9

;OLYLU[HSZMVYYLNPVUHSVMÄJLZ^LYLWHPKSH[LHUK[OLSHUKSVYKJOHYNLKPU[LYLZ[VUSH[LWH`TLU[;OPZL_WLUKP[\YL^HZUV[JVUKVULK and it will be recovered from the employee concerned.

0U[LYLZ[JOHYNLKVU[OLKPZW\[LKHTV\U[!9

There was a dispute between the Authority and the service provider on the outcome of the investigation which was conducted on the break- in that resulted in the loss of computers in the training room. This expenditure was condoned because the responsible employee was trying to get a suitable outcome from this investigation. However, the matter went before the courts and ICASA was instructed to pay the outstanding amount together with interest.

144 145

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

7H`TLU[VMH*V\UJPSSVY^P[OV\[KVPUNQ\KPJPHY`^VYR!9

;OL*V\UJPSSVYOLSKVMÄJLK\YPUN[OLWLYPVK\UKLYYL]PL^PU[LYTZVMZLJ[PVU)JVM[OL0UKLWLUKLU[*VTT\UPJH[PVUZ(\[OVYP[` VM:V\[O(MYPJH(J[VM;OL*V\UJPSSVY^HZKPZX\HSPÄLKPU[LYTZVMZLJ[PVUVM[OL(J[MYVTILPUNHWWVPU[LKZPUJLH[[OL time of his appointment, he held an interest in the electronic communications industry. His appointment was accordingly ultra vires, under the provisions of the Act.

The Councillor was reappointed to regularise the procedure of appointing a Councillor. Notice 76 of 2011 in Government Gazette 34018 was issued with effect from January 1, 2011 to effect the appointment of the Councillor.

;OPZL_WLUKP[\YL^HZJVUKVULKILJH\ZL[OL4PUPZ[LYVM*VTT\UPJH[PVUZYLHMÄYTLKOPZHWWVPU[TLU[

7YVJ\YLTLU[VMHKKP[PVUHSZLJ\YP[`N\HYKZ!9

;OLVMÄJLYPUJYLHZLK[OLU\TILYVMZLJ\YP[`N\HYKZHM[LY[OLYL^LYL[^VIYLHR¶PUPUJPKLU[Z;OLVMÄJLY^HZ[Y`PUN[VWYL]LU[ continued break–ins. After additional security guards were put in place the Authority did not have any further break-in incidents. The terms and the fees for additional security guards were the same as on the tender document but the variation was not requested from the Bid Adjudication Committee (BAC) before the increase in the number of security guards was implemented. The increase in the U\TILYVMZLJ\YP[`VMÄJLYZSLHK[VH[V[HS]HYPHUJLVM9 ^OPJO^HZUV[HWWYV]LKI`[OL)(*;OLHKKP[PVUHSZLJ\YP[`VMÄJLYZ are guarding the computer training room and the computer room housing broadcasting monitoring. The increase was realised by Administration division when they performed the account payment reconciliation.

;OPZ[YHUZHJ[PVU^HZJVUKVULKILJH\ZLP[^HZKVULVUNVVKPU[LU[PVUZHM[LY[OLIYLHRPUPUJPKLU[Z[OH[VJJ\YYLKH[OLHKVMÄJLHUK the fees charged were in line with the approved tender.

7YVJ\YLTLU[VMSLHZLKI\PSKPUNZV]LYH[OYLL`LHYWLYPVK!9

A closed tender was used instead of an open tender for the lease period that was for three years and totalled R3 766 330 for three `LHYZ;OLHTV\U[ZWLU[H[[OLLUKVM[OLÄUHUJPHS`LHY^HZ9

The decision to extend the lease could not be reached in time because there was a negotiation with the current landlord to extend. The Authority did not want to relocate because this was not budgeted for. The landlord made up his mind very late that they want to use the premises for a different purpose. It was too late to go on open tender because we hoped that the lease will be extended. +\LWYVJLZZJV\SKUV[ILMVSSV^LKILJH\ZLVM[OLKLSH`ZPUULNV[PH[PVUZ^P[O[OLJ\YYLU[SHUKSVYKHUKOPZÄUHSKLJPZPVUUV[[VL_[LUK the lease agreement for a further term. INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

-Y\P[SLZZ^HZ[LM\SHUKPYYLN\SHYL_WLUKP[\YLJVU[PU\LK

0YYLN\SHYL_WLUKP[\YL

Although the tender was closed, limited bidding process was used; the tender was adjudicated and awarded favourably, based on required criteria.

This transgression was condoned because the lease was market related, done in competition and still met the requirements of ILPUNMHPYLX\P[HISL[YHUZWHYLU[HUKJVZ[LMMLJ[P]LHUK[OV\NOP[^HZJSVZLKP[TL[[OLYLX\PYLTLU[ZVM[OL+\YIHUYLNPVUHSVMÄJL

7YVJ\YLTLU[MYVTHUL_WPYLKJVU[YHJ[!9

The services of a service provider based on an expired contract and incurred additional costs during that period. The scope was increased after the Council Committee included the benchmark of termination rates and price control range as part of this project. Markets and Competition division increased the scope of work without approaching the Bid Adjudication Committee (BAC) for approval because they thought that the approval of Council Committee entitled them to increase the scope of work with the service provider.

;OL[YHUZNYLZZPVU^HZJVUKVULKILJH\ZL[OL^VYR\UKLY[HRLUILULÄ[LK[OL(\[OVYP[`HUK[OLJVZ[PUJ\YYLK^OLYLYLHZVUHISL

;OYLLX\V[H[PVUZ^LYLUV[VI[HPULKMYVTZ\WWSPLYZMVY[OLMVSSV^PUNW\YJOHZLZ!9

Sourced training from service providers without requesting three quotations. In some instances when the staff member had a training need and it is not part of the training planned for a group, they will come with a proposed training that they obtain from what the service providers as advertised. The head of the division of that staff member will recommend the training and it will be approved by HR after it has been assessed that the fees charged are reasonable. In some instances the training was provided by a service WYV]PKLY^OVWYV]PKLZZ\WWVY[VU[OLVWLYH[PVUHSPZZ\LZHM[LY[OL^LHRULZZVM[YHPUPUNPZPKLU[PÄLKHUKHNYLLK\WVU^P[OOLHKVM division and HR. The transgression was condoned because HR and SCM policy did not cover the processes training that is being open for public and is provided on arm’s length. The SCM policy has been updated to close this gap.

146 147

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

:PNUPÄJHU[]HYPH[PVUVYKLY[OH[PZTVYL[OHU !9

The Authority appointed a service provider to develop an interface between the JDE system and the Spektrum system. The JDE Z`Z[LTPZ\ZLKMVYÄUHUJPHSYLWVY[PUNW\YWVZLZ^OPSL[OL:WLR[Y\TZ`Z[LTPZ\ZLKMVYZWLJ[Y\TTHUHNLTLU[;OLPU[LYMHJL^HZ needed in order to ensure that the data is electronically transferred between the two systems without any manual intervention. Before then, the data would be manually be transferred from the Spektrum system to the JDE system and this posed a great challenge regarding data integrity. The Spektrum system is a very old system and no adequate documentation exists for this system. Due to the fact that the Spektrum system is a very old system and some of its programmes could not be changed as initially anticipated, the alternative was to make these programme changes on the JD Edwards system in order to ensure that the interface between the two systems would work. Due to these constraints and the nature of the project, it was not advisable to have another service provider [VJVU[PU\L^P[O[OLJVUÄN\YH[PVU[OH[^HZHSYLHK`VUNVPUN=HYPH[PVUVM ^HZKVULHUKP[^HZHWWYV]LKI`)PK(KQ\KPJH[PVU Committee in line with the ICASA’s SCM policy. Despite the fact that the variation was in line with the approved SCM policy the (\KP[VY.LULYHSMLS[[OH[[OLHTV\U[ZOV\SKILJSHZZPÄLKHZPYYLN\SHYL_WLUKP[\YLK\L[V[OLMHJ[[OH[[OL;YLHZ\Y`9LN\SH[PVUZKPK not make any direct mention of variations and also due to the fact that they wanted to be prudent. 7RWDO /HDVHKROG ,PSURYHPHQWV - - - XQGHU /HDVH )LQDQFH Computer Computer 2IðFHDQG Equipment Equipment Motor VehiclesMotor Equipment Test )LWWLQJV )XUQLWXUHDQG R RRRR Computer Computer 2IðFHDQG Equipment 0DUFK Cost %DODQFHDW$SULO UHVWDWHG AdditionsDisposals betweenTransfers categories 096 (2 743) 168 183 419 781 354) (353 35 931) 793 (486 - 816) (276 779 361 066 21 345 571 13 240) (378 090) 789 (1 - - - 2 436 411 431) 284 (3 960 973 16 - 509) 892 (1 %DODQFHDW0DUFK Depreciation intangible assets to Transfers 1HWFDUU\LQJDPRXQWDW 449) (713 0DUFK 944 7 678 498 26 588 385 33 857 725 717 363) (24 085 4 898 832) (832 - 810 1 828 066 930 14 - 457) (677 $FFXPXODWHG 'HSUHFLDWLRQ %DODQFHDW$SULO Disposals%DODQFHDW0DUFK 443) (175 (335 873) 194) (144 325) (230 533) (914 - 800 368) (1 NOTES TO THE FINANCIAL STATEMENTS THE FINANCIAL TO NOTES for the year ended March 2011 31 7YVWLY[`WSHU[HUKLX\PWTLU[ INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA SOUTH OF AUTHORITY COMMUNICATIONS INDEPENDENT

148 149 7RWDO /HDVHKROG ,PSURYHPHQWV XQGHU /HDVH )LQDQFH Computer Computer 2IðFHDQG Equipment Equipment Test Test Equipment Motor Vehicles Motor )LWWLQJV )XUQLWXUHDQG R RRR R Computer Computer 2IðFHDQG Equipment Depreciation %DODQFHDW0DUFK1HWFDUU\LQJDPRXQWDW 0DUFK 734 3 276 349 922 173 723 724 2 126 323 105 122 218 425 7 372 %DODQFHDW0DUFK $FFXPXODWHG 'HSUHFLDWLRQ %DODQFHDW$SULO betweenTransfers categories Disposals 657) (3 - 824) 249 (1 116) (545 - 138) (292 573) (59 - - - - 651) 146 (2 - 657) (3 ò5HVWDWHG Cost %DODQFHDW$SULO UHVWDWHG AdditionsImpairment 480 8 316 860 2 027 045) (423 - - 158 8 672 - - 435 829 - 448 20 330 - - 045) (423 Disposals 437) 901 (1 580) (873 (504 048) 705) (146 - - 770) 425 (3 INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA SOUTH OF AUTHORITY COMMUNICATIONS INDEPENDENT NOTES TO THE FINANCIAL STATEMENTS THE FINANCIAL TO NOTES for the year ended March 2011 31 7YVWLY[`WSHU[HUKLX\PWTLU[JVU[PU\LK INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

0U[HUNPISLHZZL[Z

4HYJO *VZ[ :VM[^HYL >07 ;V[HS Balance at 1 April 11 183 951 11 183 951 Additions 4 873 804 601 866 5 475 670 Disposals (3 779 789) - (3 779 789) Transfers from property, plant and equipment 1 892 506 - 1 892 506 Balance at 31 March

(JJ\T\SH[LKHTVY[PZH[PVU :VM[^HYL >07 ;V[HS Balance at 1 April 5 924 029 - 5 924 029 Amortisation 1 193 135 - 1 193 135 Disposals (3 678 906) - (3 678 906) Transfers between categories 677 454 - 677 454 Balance at 31 March

Net carrying amount

4HYJO *VZ[ :VM[^HYL >07 ;V[HS Balance at 1 April 8 410 804 - 8 410 804 Additions 2 773 147 - 2 773 147 Balance at 31 March 11 183 951 - 11 183 951

(JJ\T\SH[LKHTVY[PZH[PVU :VM[^HYL >07 ;V[HS Balance at 1 April 5 634 391 - 5 634 391 Amortisation 293 295 - 293 295 Transfers between categories (3 657) - (3 657) Balance at 31 March 5 924 029 - 5 924 029

Net carrying amount 5 259 922 - 5 259 922

150 151

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 5V[L (J[\HS 9LZ[H[LK ;YHKLHUKV[OLYYLJLP]HISLZMYVTL_JOHUNL[YHUZHJ[PVUZ

Staff receivables 1 139 928 Less: Impairment of staff receivables (84 756) Net staff receivables 1 055 172 Other receivables 396 214 1 451 386

Impairment of receivables Opening balance 170 875 0TWHPYTLU[ZYLJVNUPZLKPUZ\YWS\ZHUKKLÄJP[ (86 119) Closing balance 84 756

As at 31 March 2011, the carrying values of trade and other receivables were estimated to approximate their fair values.

As of 31 March 2011, trade receivables of 95PS (2010: R59 772) were impaired and provided for. The amount of the provision was 9 as of 31 March 2011 (2010: R84 756). The aging of the provision for impairment at 31 March 2011 was as follows:

Amounts in 30 days 19 428 Amounts in 91 days + 65 328 84 756

As at 31 March 2011 accounts receivables totalling 9 (2010: R831 747) were past due but not impaired. These relate to a number of independent staff debtors for whom there is no recent history of default.

The aging of these receivables is as follows: Amounts in 30 days 36 191 Amounts in 61 to 90 days - Amounts in 91 days + 795 556 831 747 INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 5V[L (J[\HS 9LZ[H[LK ;YHKLHUKV[OLYYLJLP]HISLZMYVTL_JOHUNL[YHUZHJ[PVUZJVU[PU\LK

The above-mentioned receivables mainly related to bursaries, standing advances, travel and cellular phones. The bursaries are recouped when the staff member stops studying, leaves the employment of the Authority or changes the course that the person was initially sponsored for. The employee is expected to serve a term equivalent to the term sponsored. Standing advances relate [VHTV\U[ZHK]HUJLK[VLTWSV`LLZ^OVHYLUV[VMÄJLIV\UKHUKHYLYLWH`HISL^OLU[OLLTWSV`LLYLZPNUZ

Travel and cell phone debtors refer to amounts that the employee owes the Authority after a business trip or for excess/personal usage of the cell phone provided to the employee by the Authority. Normally no impairment is provided for on these amounts as these amounts are recovered from employees on a regular basis. However, in instances where the employee might have left the organisation before these amounts are settled in full and all possible avenues to recover these amounts have been exhausted, impairment may occur. All staff receivables are entered into with the employees of the Authority who are in the employment of ICASA. The employees sign contracts for bursaries, standing advance and cell phones which give the Authority the right to deduct outstanding amounts. For training related international travel, employees sign letters that gives the Authority the right to deduct such amounts should employees decide to leave before the stipulated period of time.

As at 31 March 2011 R Nil (2010: R Nil) of trade and other receivables were denominated in foreign currencies.

The maximum exposure to credit risk at the reporting date is the carrying value of each class of receivable mentioned above. The Authority does not hold any collateral as security.

The rating of gross trade and other receivables was as follows: Medium risk 1 536 142 High risk - 1 536 142

The trade and other receivables balances are considered to be medium risk because they are mainly granted to staff members and these are normally deducted from the employees. Dealings outside ICASA are normally with reputable institutions with good credit ratings.

;YHKLHUKV[OLYYLJLP]HISLZMYVTUVUL_JOHUNL[YHUZHJ[PVUZ Employee tax 5 447 5 447

152 153

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 5V[L (J[\HS 9LZ[H[LK 5H[PVUHS9L]LU\L-\UK¶(KTPUPZ[LYLK(ZZL[Z

Accounts receivable due to National Revenue Fund: Broadcasting services 100 001 854 Spectrum receivables 34 706 664 ECS and ECNS services 374 650 996 Postal services 18 314 817 527 674 331 Provision for impairment (31 393 047) 496 281 284

Accruals for licence fees relates to the accrual for all licences that were due at the end of the reporting period but were only due for settlement after the end of the reporting period. These are based on either the actual results of the licensee, where the licensee has ÄUHSPZLKP[ZÄUHUJPHSZ[H[LTLU[ZPUPUZ[HUJLZ^OLYLHJ[\HSYLZ\S[ZHYLUV[H]HPSHISLH[[OLLUKVM[OLYLWVY[PUNWLYPVK[OLSPJLUZLL Z\ITP[Z[OLL_WLJ[LKÄUHUJPHSYLZ\S[Z

The spectrum receivables relate to the balances that were due by spectrum licensees but had not been settled at the end of the reporting period. These relate to different licences that are awarded for different spectrum frequencies. In instances where licences HYLH^HYKLKK\YPUN[OLJV\YZLVM[OLÄUHUJPHS`LHY[OLPU]VPJLZMVY[OLZWLJ[Y\TSPJLUZLLZHYLWYVYH[LK

ECS and ECNS receivables relate to all the amounts that had been billed to but not settled by the Electronic Communications and the Electronic Communications Network licensees.

The broadcasting receivables relate to all the outstanding licence fees for broadcasting licences. INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 5V[L (J[\HS 9LZ[H[LK 5H[PVUHS9L]LU\L-\UK¶(KTPUPZ[LYLK(ZZL[ZJVU[PU\LK

The aging of the gross trade receivables balances was as follows: Current 491 119 453 31-60 days 21 485 258 61-90 days 5 093 664 Greater than 90 days 9 975 956 527 674 331

;OLSPJLUJLZHYLNYHU[LK[V]HYPV\ZJ\Z[VTLYZ^P[O]LY`KPMMLYLU[JYLKP[WYVÄSLZ;OLZLPUJS\KLZ\JJLZZM\ST\S[PUH[PVUHSJVYWVYH[PVUZ IPNZLJ\YP[`JVTWHUPLZTLKP\TZPaLKLU[P[PLZHUK]LY`ZTHSSLU[P[PLZ;OLJYLKP[WYVÄSLZVM[OLZLLU[P[PLZ]HY`ZPNUPÄJHU[S`HUKPU terms of the legislation, the Authority cannot refuse to grant any entity licences due to its credit rating. Despite the fact that no credit vetting takes place, all licensees are granted licences after they have lodged their applications with ICASA. In instances where the licensee fails to comply with its licence conditions which include payments terms, the licensee is referred to the CCC Committee or has its equipment sealed.

7YLWH`TLU[Z

Insurance 304 096 6MÄJLYLU[HS 3 109 090 Computer equipment, motor vehicles, furniture, software guarantees, software and others 1 118 299 4 531 485

154 155

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 5V[L (J[\HS 9LZ[H[LK *HZOHUKJHZOLX\P]HSLU[Z

Cash on hand and balances with banks 55 459 424 Administered Revenue cash balance 25 684 928 81 144 352

Cash and cash equivalents consist of cash on hand and balances with banks. The cash and cash equivalents balances as disclosed above did not include any restricted cash nor did the Authority have any borrowing facilities at the end of each reporting period. Included above is 5 (2009: R25 684 928) for the Administered Revenue section. The funds received collected by the Administered Revenue section are transferred to the National Revenue Fund through the Department of Communications. ICASA KVLZUV[OH]L[OLYPNO[[V^P[OOVSK[OLZLM\UKZVY\ZL[OLTMVYHU`V[OLYW\YWVZLP[TH`KLLTÄ[;OLJHZOHUKJHZOLX\P]HSLU[Z HYLWSHJLK^P[OOPNOJYLKP[X\HSP[`ÄUHUJPHSPUZ[P[\[PVUZ

;YHKLHUKV[OLYWH`HISLZMYVTL_JOHUNL[YHUZHJ[PVUZ

Trade payables 3 912 493 Accrued expenses 14 307 091 Bonus accrued 9 223 104 Leave liability accrued 5 064 842 Interest payable - Other 152 604 32 660 134

The fair value of trade and other payables from exchange transactions was 5 (2010: R32 660 134). The amounts included in trade and other payables are not secured. The fair values of trade and other payables approximate their fair values.

;YHKLHUKV[OLYWH`HISLZMYVTUVUL_JOHUNL[YHUZHJ[PVUZ

Donations received 20 937 Other - 20 937 INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 5V[L (J[\HS 9LZ[H[LK ;YHKLHUKV[OLYWH`HISLZMYVTUVUL_JOHUNL[YHUZHJ[PVUZJVU[PU\LK

The fair value of trade and other payables from non-exchange transactions was R22 663 (2010: R20 937). The amounts included in trade and other payables from non-exchange transactions are not secured. The fair values of trade and other payables approximate their fair values

5H[PVUHS9L]LU\L-\UKWH`HISLZ

6WLYH[PUNSLHZLSPHIPSP[`

Current portion of operating lease liability– included in (current assets)/ current liabilities 22 653 Non-current portion of operating lease liability – included in non-current liabilities - Net operating lease liability – to be released over the period of the leases 22 653

156 157

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 5V[L (J[\HS 9LZ[H[LK 6WLYH[PUNSLHZLHYYHUNLTLU[Z

At 31 March 2011 outstanding commitments existed under non- cancellable operating leases which fall due as follows: Up to 1 year 16 421 660 2 to 5 years - 16 421 660

;OLVWLYH[PUNSLHZLZLU[LYLKPU[VYLWYLZLU[HYYHUNLTLU[Z[VSLHZLVMÄJLWYLTPZLZ;OLVWLYH[PUNSLHZLJVTTP[TLU[ZJVTWYPZL JHZOÅV^JVTTP[TLU[Z

The terms of the leases vary with expiry dates between end of January 2012 and August 2013. Escalation clauses range between 9 percent and 10 percent per annum depending on the lease agreements. At 31 March 2011, the Authority had no commitments \UKLYUVUJHUJLSSHISLVWLYH[PUNSLHZLZHZSLZZVY;OLSLHZLZHYLMVYHÄ_LKWLYPVKVM[PTLHUKHYLVUS`YLUL^HISL^OLU[OLSLZZVY and the lessee agree on the renewal terms. The leases do not contain a purchase option. INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 5V[L (J[\HS 9LZ[H[LK 9LJVUJPSPH[PVUVMUL[JHZOÅV^ZMYVTVWLYH[PUNHJ[P]P[PLZ[VKLÄJP[

+LÄJP[MVY[OLWLYPVK (4 770 182) Non-cash movements 30 487 614 - Depreciation 7 372 425 - Amortisation 293 295 +LÄJP[VUKPZWVZHSVMWYVWLY[`WSHU[HUKLX\PWTLU[ 1 155 833 Impairment of property, plant and equipment 423 045 - Increase/(decrease) in lease liabilities (6 369 988) - (Increase)/decrease in receivables and prepayments 3 798 607 (Decrease)/increase in provision for impairment 86 119 - (Increase)/decrease in Administered Revenue Assets 59 553 353 - (Decrease)/increases in payables 15 035 535 Increase/(decrease) in Administered Revenue’s liabilities (50 686 933) -Increase in plant and equipment delivered but not paid for +LJYLHZLPUÄUHUJLSLHZLSPHIPSP[` (173 677) 5L[JHZOÅV^ZMYVTVWLYH[PUNHJ[P]P[PLZ 25 717 432

*VU[PUNLU[SPHIPSP[PLZ

;OL(\[OVYP[`»ZKLJPZPVUZHYLVM[LUJOHSSLUNLK[OYV\NO[OLJV\Y[Z;OLÄUHSV\[JVTLJHUUV[ILYLSPHIS`KL[LYTPULKHZP[PZKLWLUKLU[ VU[OLZ[YLUN[OVMLHJOWHY[`»ZJHZLHUK[OL1\KPJPHY`»ZÄUKPUNZ(JVU[PUNLU[SPHIPSP[`PZUV[LKMVYSLNHSJHZLZ[OH[TH`OH]L unfavourable decisions.

Contingent liabilities - various legal cases 4 180 000

158 159

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

9LSH[LKWHY[`YLSH[PVUZOPWZHUK[YHUZHJ[PVUZ

The Independent Communications Authority of South Africa (ICASA) is a Schedule 1 entity in terms of the Public Finance Management Act (PFMA). The related party disclosure is required in terms of IPSAS 20, related party disclosures issued by National Treasury.

5H[PVUHS+LWHY[TLU[Z

+LWHY[TLU[VM*VTT\UPJH[PVUZ The Authority receives its budget allocation from the Department of Communications and this based on the approved allocation from Parliament and therefore this is at arm’s length. ICASA collects the licence fees from communication licensees and application fees on behalf of National Revenue Fund and transfer this to the Department of Communications and this is done on arm’s length.

The following departments acquire and use the spectrum issued by the Authority at arm’s length:

Department of Water and Environmental Affairs Department of Defence and Military Veterans South African Police Services

,U[P[PLZ

The following entities acquired and use the spectrum issued by the Authority and they are also licenced under the Electronic Communications Act and Postal Service Act. All the transactions and the issued licences are at arm’s length: Telkom :V\[O(MYPJHU7VZ[6MÄJL Sentech Transnet SITA SABC Broadband Infraco INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

9LSH[LKWHY[`YLSH[PVUZOPWZHUK[YHUZHJ[PVUZJVU[PU\LK

The Authority acquires the servicers at arm’s length from these entities: Government Printing Works Telkom :V\[O(MYPJHU7VZ[6MÄJL Sentech Transnet SITA SABC

Refer to note 7 for all transactions between ICASA and key management personnel. There is not key management who owned an entity; close family member of such individual employee had transactions or business interest with the Authority except for the following Councillor:

Councillor Stucke owned a company which had an electronic communication licence with ICASA, now disposed of.

-PUHUJPHSYPZRTHUHNLTLU[

-VY^HYKMVYLPNUL_JOHUNLJVU[YHJ[Z No forward foreign exchange contracts were entered into during the current year under review.

*YLKP[YPZR *YLKP[YPZRPZ[OLYPZR[OH[0*(:(TH`Z\MMLYHÄUHUJPHSSVZZPMHJ\Z[VTLYVYJV\U[LYWHY[`[VHÄUHUJPHSPUZ[Y\TLU[MHPSZ[VTLL[ its contractual obligations; this arises mainly from staff receivables. Financial assets which potentially subject the Authority to concentrations of credit risk consist principally of cash and cash equivalents and trade and other receivables. The cash and cash LX\P]HSLU[ZHYLWSHJLK^P[OOPNOJYLKP[X\HSP[`ÄUHUJPHSPUZ[P[\[PVUZ;YHKLHUKV[OLYYLJLP]HISLZHYLWYLZLU[LKUL[VM[OLHSSV^HUJL MVYKV\I[M\SYLJLP]HISLZ;OL(\[OVYP[`OHZUVZPNUPÄJHU[JVUJLU[YH[PVUVMJYLKP[YPZR;YHKLHUKV[OLYYLJLP]HISLZHYLWYLZLU[LKUL[ of the allowance for doubtful receivables

Trade and other receivables mainly originate from transactions that the Authority enters into with the employees. The main components of these receivables are bursary receivables, standing advance receivables, cell phone receivables and travel-related receivables (other). The standing advance receivables are only payable when the employee leaves the employment of the Authority whether through resignation, disability, death or search of greener pastures. The bursary receivables originate when a qualifying LTWSV`LLVM[OL(\[OVYP[`PZNYHU[LKHI\YZHY`[VW\YZ\LZ[\KPLZPUHWHY[PJ\SHYÄLSKVMZ[\K`[OH[^V\SKIL\ZLM\S[V[OL(\[OVYP[`VU completion of his/her studies. Cell phone receivables and travel-related receivables relate to the day-to-day activities and these are

160 161

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 5V[L (J[\HS 9LZ[H[LK

YLJV]LYLKVUHTVU[OS`IHZPZMYVT[OLLTWSV`LLZJVUJLYULK5VZPNUPÄJHU[SVZZLZOH]LL]LYILLUZ\MMLYLKMYVTZ[HMMYLJLP]HISLZ The staff receivables are owed by many employees and they are diverse and they don’t pose any major concentration of credit risk.

Trade and other receivables 1 456 833 Cash and cash equivalents 81 144 352 82 601 185

The maximum exposure to credit risk for trades receivable by type of customer was as follows:

Staff receivables 1 055 172 Other receivables 401 661 1 456 833

0U[LYLZ[YH[LYPZR

*HZOHUKJHZOLX\P]HSLU[ZOH]LTH[\YP[PLZVMSLZZ[OHU[OYLLTVU[OZHUKHYLUV[Z\IQLJ[[VZPNUPÄJHU[PU[LYLZ[YH[LYPZR

3PX\PKP[`YPZR

3PX\PKP[`YPZRPZ[OLYPZR[OH[[OL(\[OVYP[`^PSSUV[ILHISL[VTLL[P[ZÄUHUJPHSVISPNH[PVUZHZ[OL`MHSSK\L;OL(\[OVYP[`ÄUHUJLZP[Z operations through grants received from the Department of Communications and interest earned on positive bank balances. These HYL[OLVUS`ZV\YJLZVMÄUHUJLMVY[OL(\[OVYP[`K\L[V[OLMHJ[[OH[[OL7\ISPJ-PUHUJL4HUHNLTLU[(J[WYVOPIP[Z[OL(\[OVYP[`MYVT raising loans and other forms of short-term and long-term borrowings. INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 5V[L (J[\HS 9LZ[H[LK -PUHUJPHSYPZRTHUHNLTLU[JVU[PU\LK

The entity maintains a reasonable balance between the period over which assets generate funds and the period over which the YLZWLJ[P]L HZZL[Z HYL M\UKLK ;OL MVSSV^PUN [HISL WYV]PKLZ KL[HPS VM [OL LU[P[`»Z YLTHPUPUN JVU[YHJ[\HS TH[\YP[` MVY P[Z ÄUHUJPHS SPHIPSP[PLZ;OL[HISLOHZILLUKYH^U\WIHZLKVU[OL\UKPZJV\U[LKJHZOÅV^ZVMÄUHUJPHSSPHIPSP[PLZIHZLKVU[OLLHYSPLZ[KH[L VU^OPJO[OLLU[P[` JHU ILYLX\PYLK[VWH`;OLÄN\YLZILSV^PUJS\KL IV[O LZ[PTH[LK PU[LYLZ[ HUK WYPUJPWHS JHZO ÅV^Z VM [OL PUZ[Y\TLU[Z,Z[PTH[LKPU[LYLZ[VMÅVH[PUNPU[LYLZ[YH[LÄUHUJPHSSPHIPSP[PLZPZJHSJ\SH[LK\ZPUN[OLHWWSPJHISLPU[LYLZ[YH[LZH[[OLLUK VM[OLÄUHUJPHS`LHYLUK

4H[\YP[`HUHS`ZPZ

4HYJO ;V[HS `LHY `LHYZ Trade payables 2 508 980 2 475 028 33 952 2 508 980 2 475 028 33 952

31 March 2010 ;V[HS `LHY `LHYZ Trade payables 3 912 492 3 912 492 - 3 912 492 3 912 492 -

-HPY]HS\LZ

The carrying amounts of cash and cash equivalents, trade and other receivables and trade payables approximated their fair values at the reporting date due to the short-term maturities of these assets and liabilities.

162 163

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

-PUHUJPHSYPZRTHUHNLTLU[JVU[PU\LK

9PZRTHUHNLTLU[WVSPJPLZ ;OLYLPZUVZPNUPÄJHU[L_WVZ\YL[VMVYLPNUJ\YYLUJ`YPZRPU[LYLZ[YH[LYPZRJYLKP[YPZRHUKSPX\PKP[`YPZR

0U[LYLZ[YH[LZLUZP[P]P[`HUHS`ZPZ

;OL(\[OVYP[`KPKUV[OH]LHU`ZPNUPÄJHU[ÄUHUJPHSPUZ[Y\TLU[Z[OH[L_WVZLP[[VPU[LYLZ[YH[LZH[YLWVY[PUNKH[L

-VYLPNUJ\YYLUJ`YPZRTHUHNLTLU[

;OL(\[OVYP[`KPKUV[OH]LHU`L_WVZ\YL[VMVYLPNUJ\YYLUJ`ZPUJLP[KPKUV[OH]LHU`ÄUHUJPHSPUZ[Y\TLU[ZKLUVTPUH[LKPUMVYLPNU currency.

-PUHUJPHSYPZRTHUHNLTLU[MVY(KTPUPZ[LYLK(ZZL[Z

Information about ICASA Administered Revenue’s exposure to risks, its objectives, policies and processes for measuring and managing such risks, as well as quantitative disclosure, are discussed in this note.

*YLKP[YPZR *YLKP[YPZRPZ[OLYPZR[OH[0*(:((KTPUPZ[LYLK9L]LU\LTH`Z\MMLYHÄUHUJPHSSVZZPMHJ\Z[VTLYVYJV\U[LYWHY[`[VHÄUHUJPHS instrument fails to meet its contractual obligations, this arises mainly from Administered Revenue’s trade receivables. The licensees of Administered Revenue have to apply in terms of the relevant legislations in order to be authorised to conduct any activities.

Financial assets which potentially subject the Administered Revenue to concentrations of credit risk consist principally of cash and cash equivalents and trade receivables.

;OLJHZOHUKJHZOLX\P]HSLU[ZHYLWSHJLK^P[OOPNOJYLKP[X\HSP[`ÄUHUJPHSPUZ[P[\[PVUZ;YHKLHUKV[OLYYLJLP]HISLZHYLWYLZLU[LK net of the allowance for doubtful receivables.

ICASA Administered Revenue collects the majority of its revenue from the major mobile telecommunications companies and these have excellent reputation and they receive very good credit ratings from the world-renowned credit rating agencies and they are world-class in their industry. These companies have been dealing with the Administered Revenue since they were granted their telecommunications licences in the 1990s. There has hardly been any loss incurred from these customers. INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

-PUHUJPHSYPZRTHUHNLTLU[MVY(KTPUPZ[LYLK(ZZL[ZJVU[PU\LK

*YLKP[YPZRJVU[PU\LK

;OLV[OLY[OPYKTVIPSL[LSLJVTT\UPJH[PVUZSPJLUZLLPZUV[ZPNUPÄJHU[^OLUJVTWHYLK^P[O[OLTHQVYVWLYH[VYZ5VSVZZLZOH]LL]LY ILLUZ\MMLYLKMYVT[OPZVWLYH[VY(UV[OLYWVY[PVUVM[OLYL]LU\LPZJVSSLJ[LKMYVT[OLÄ_LKSPUL[LSLJVTT\UPJH[PVUZSPJLUZLLZ;OL THQVYVULVM[OLZLÄ_LKTVIPSLSPJLUZLLZOHZILLUPUVWLYH[PVUMVYTHU``LHYZHUK[OLYLOHZUL]LYILLUHU`ÄUHUJPHSSVZZZ\MMLYLK HZHYLZ\S[VM[OPZSPJLUZLLMHPSPUN[VTLL[P[ZSPJLUJLVISPNH[PVUZ;OLV[OLYÄ_LKSPULSPJLUZLLOHZVUS`ILLUPUVWLYH[PVUMVYHJV\WSL VM`LHYZHUKUVÄUHUJPHSSVZZLZOH]LL]LYILLUZ\MMLYLK

The spectrum licensees are diverse and they comprise different licensees from Government Departments, major telecommunications JVTWHUPLZ IYVHKJHZ[PUN SPJLUZLLZ ZLJ\YP[` JVTWHUPLZ L[J ;OLYL PZ UV ZPNUPÄJHU[ L_WVZ\YL MYVT THQVY JVYWVYH[PVUZ HUK Government Departments. It must be noted though that collecting from minor licensees and some corporations do pose a challenge due to the value of the amounts outstanding as well as the resources that are available to ICASA to collect the amounts outstanding. The other challenge relates the legal challenges that ICASA gets embroiled in when it acts in terms of the relevant legislation. The disputes tend to be time-consuming and costly. It is hoped that the new legislation under review will address the shortcomings of the current legislation.

;OLIYVHKJHZ[PUNSPJLUZLLZHUKWVZ[HSSPJLUZLLZHYLPUZPNUPÄJHU[^OLUJVTWHYLK[V[OL[LSLJVTT\UPJH[PVUZSPJLUZLLZHUK[OL`HYL diverse and they don’t pose any major concentration of credit risk

The Electronic Communications Act was implemented with effect from the 1st of April 2009; no major shift in the credit risk has been PKLU[PÄLKZPUJL[OLPTWSLTLU[H[PVUVM[OLZLUL^YLN\SH[PVUZ5VZPNUPÄJHU[PTWHJ[VU[OLWYVÄ[HIPSP[`HUKJYLKP[YH[PUNZVM[OLTHQVY VWLYH[VYZOHZILLUPKLU[PÄLKZPUJL[OLPTWSLTLU[H[PVUVM[OLZLYLN\SH[PVUZ

6US`[OLWHZZPUNVM[PTL[OLJVTWL[P[P]LULZZVM[OLTHYRL[Z[OLH]HPSHIPSP[`VMÄUHUJLHUK[OLHJ[PVUZVM[OLUL^S`SPJLUJLK VWLYH[VYZHZ^LSSHZTHQVYVWLYH[VYZ^PSSKL[LYTPUL^OL[OLY[OLWYVÄ[HIPSP[`VMTHQVYVWLYH[VYZPZHMMLJ[LKVYUV[

164 165

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 5V[L (J[\HS 9LZ[H[LK -PUHUJPHSYPZRTHUHNLTLU[MVY(KTPUPZ[LYLK(ZZL[ZJVU[PU\LK

,_WVZ\YL[VJYLKP[YPZR

;OLNYVZZJHYY`PUNHTV\U[VMÄUHUJPHSHZZL[ZYLWYLZLU[Z[OLTH_PT\TJYLKP[L_WVZ\YL;OLTH_PT\TL_WVZ\YL[VJYLKP[YPZRH[ the reporting date was:

Trade receivables 527 674 331 527 674 331

The maximum exposure to credit risk for trade receivables by type of customer was as follows:

Broadcasting services - Frequency spectrum services 34 706 663 ECS and ECNS services 492 967 668 Postal services - 527 674 331

At 31 March 2011, carrying amounts of trade receivables were estimated to approximate their fair values. The rating of trade receivables at the end of March was as follows:

Low risk 478 222 702 Medium risk 18 058 582 High risk 31 393 047 527 674 331 INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 5V[L (J[\HS 9LZ[H[LK -PUHUJPHSYPZRTHUHNLTLU[MVY(KTPUPZ[LYLK(ZZL[ZJVU[PU\LK

At 31 March 2011, carrying amounts of trade receivables were estimated to approximate their fair values. The rating of trade receivables at the end of March was as follows:

Low risk 478 222 702 Medium risk 18 058 582 High risk 31 393 047 527 674 331

0TWHPYTLU[SVZZLZ

0TWHPYTLU[SVZZLZHYLYLJVNUPZLKMVYHSSRUV^UIHKKLI[ZHUKHYLWYV]PKLKVUHZWLJPÄJIHZPZ;OLTV]LTLU[PU[OLWYV]PZPVUMVY impairment of trade and other receivables was as follows:

Impairment of receivables Opening balance 24 109 351 0TWHPYTLU[ZYLJVNUPZLKPUWYVÄ[HUKSVZZ 20 187 060 9L]LYZHSZVMPTWHPYTLU[ZYLJVNUPZLKPUWYVÄ[HUKSVZZ (12 903 363) Closing balance 31 393 048

;OLHNPUNVM[OLWYV]PZPVUMVYPTWHPYTLU[H[[OLLUKVM[OLÄUHUJPHS`LHY^HZHZMVSSV^Z!

Amounts in 0-60 days 19 798 172 Amount in greater than 120 days 11 594 876 31 393 048

As of 31 March 2011, trade receivables of 9 (2010: R20 187 060) were impaired and provided for. Additional spectrum receivables totalling9!95PS^LYL^YP[[LUVMK\YPUN[OLÄUHUJPHS`LHYK\L[V[OLMHJ[[OH[[OLZLHTV\U[ZJV\SK not be traced. The amount of the provision was R102 706 798 at 31 March 2011 (2010: R31 393 048). The individually impaired receivables mainly relate to frequency spectrum debtors, broadcasting services debtors and postal service debtors.

166 167

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 5V[L (J[\HS 9LZ[H[LK -PUHUJPHSYPZRTHUHNLTLU[MVY(KTPUPZ[LYLK(ZZL[ZJVU[PU\LK

As at 31 March 2011 accounts receivable totalling 5 (2010: R17 990 416) were past due but not impaired. These relate to a number of independent debtors for whom there is no recent history of default.

The aging of these receivables is as follows:

Trade receivable past due but not impaired

Amount in 31-60 days - Amount in 61-90 days 17 990 416 Amounts in 91 days + - 17 990 416

Based on past experience, accounts receivable balances that are past due are not impaired unless they are known to be impaired.

,_WVZ\YL[VJYLKP[YPZR

The above-mentioned receivables relate mainly to the telecommunications licensee for multi-media and carrier of carriers licences, short-payments by broadcasting and telecommunications licensees, interest on late payment of licence fees, Universal Service and Access Fund contributions and VANS licence fees. The major debtor entered into a payment agreement with the Authority and they have been paying in accordance with the agreed-upon payment plans. The other accounts receivable balances were not provided for due to the fact that there was an undertaking from the parties concerned that the outstanding amounts will be settled and for some debtors, there was high probability that the amounts outstanding will be recovered based on the payment patterns of the customers concerned.

As at 31 March 2011 R Nil (2010: R Nil) of trade and other receivables were denominated in foreign currencies.

;OLJYLH[PVUHUKYLSLHZLVMWYV]PZPVUMVYPTWHPYLKYLJLP]HISLZOH]LILLUPUJS\KLKZ\YWS\ZVYKLÄJP[MVY[OLWLYPVK(TV\U[ZJOHYNLK to the allowance account are generally written off when there is no expectation of recovering additional cash. INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

-PUHUJPHSYPZRTHUHNLTLU[MVY(KTPUPZ[LYLK(ZZL[ZJVU[PU\LK

,_WVZ\YL[VJYLKP[YPZRJVU[PU\LK

-VY^HYKMVYLPNUL_JOHUNLJVU[YHJ[Z

No forward foreign exchange contracts were entered into during the current year under review.

0U[LYLZ[YH[LYPZR

*HZOHUKJHZOLX\P]HSLU[ZOH]LTH[\YP[PLZVMSLZZ[OHU[OYLLTVU[OZHUKHYLUV[Z\IQLJ[[VZPNUPÄJHU[PU[LYLZ[YH[LYPZR

3PX\PKP[`YPZR

3PX\PKP[`YPZRPZ[OLYPZR[OH[[OL(KTPUPZ[LYLK9L]LU\L^PSSUV[ILHISL[VTLL[P[ZÄUHUJPHSVISPNH[PVUZHZ[OL`MHSSK\L;OL(KTPUPZ[LYLK Revenue collects licence fees from the Telecommunications Services Licensees Broadcasting Services Licensees and the Postal Services Licensees. All the fees collected are paid over to the National Treasury through the Department of Communications within 30 days of their collection.

,_WVZ\YL[VJYLKP[YPZR

(SS[OLVWLYH[PUNJVZ[ZVM[OL(KTPUPZ[LYLK9L]LU\LZLJ[PVUHYLÄUHUJLKI`0*(:([OYV\NONYHU[ZP[YLJLP]LZMYVT[OL+LWHY[TLU[ VM*VTT\UPJH[PVUZHUKPU[LYLZ[LHYULKVUWVZP[P]LIHURIHSHUJLZ;OLZLHYL[OLVUS`ZV\YJLZVMÄUHUJLH]HPSHISL[V0*(:(K\L[V the fact that the Public Finance Management Act prohibits ICASA from raising loans and other forms of short-term and long-term ÄUHUJL-\Y[OLYTVYL0*(:(PZWYVOPIP[LKMYVT\[PSPZPUN[OLMLLZP[JVSSLJ[Z[VM\UKP[ZVWLYH[PVUZ

-HPY]HS\LZ

9PZRTHUHNLTLU[WVSPJPLZ

The Authority has an exposure to foreign currency risk, interest rate risk, credit risk and liquidity risk because it is funded by National Treasury. The Authority does not enter into foreign exchange contracts; furthermore, it did not have any receivables that exposed it [VPU[LYLZ[YH[LÅ\J[\H[PVUZ-\Y[OLYTVYL[OLYL^LYLUVPUKP]PK\HSJ\Z[VTLYZ[OH[L_WVZLKP[[VSPX\PKP[`YPZR

168 169

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

*OHUNLZPULZ[PTH[LZ

Useful lives of property, plant and equipment and intangible assets

The management determines the estimated useful lives and related depreciation charges for property, plant and equipment as well as its intangible assets. The estimates are based on the assessed conditions of the assets, changes in technology such as new technical innovations being introduced in the industry thus rendering our assets obsolete as well as expected future spending VUJHWP[HSHZZL[Z;OLZLLZ[PTH[LZJHUJOHUNLZPNUPÄJHU[S`HZHYLZ\S[VMJOHUNLZPU[OLJVUKP[PVUZVMHZZL[ZPU[YVK\J[PVUVMUL^ [LJOUVSVNPLZHUKH]HPSHIPSP[`VMÄUHUJLYLZV\YJLZ[VM\UKL_WLJ[LKM\[\YLZWLUKPUNVUJHWP[HSHZZL[Z

;OLYLZPK\HS]HS\LZHUK\ZLM\SSP]LZ^LYLYL]PL^LKK\YPUN[OLJV\YZLVM[OLÄUHUJPHSPUSPUL^P[OWHYHNYHWOVM.9(7HUK[OL effect thereof was on follows:

+LWYLJPH[PVU Furniture Motor Test 2IðFHDQG /HDVHKROG 7RWDO DQG Vehicles Equipment Computer ,PSURYHPHQWV )LWWLQJV Equipment XQGHU )LQDQFH /HDVH RR R R R Depreciation after changes in useful lives and residual values 7 678 944 588 385 717 725 4 085 898 (832 832) 1 828 810 14 066 930 Depreciation before changes in useful lives and residual values 3 744 500 160 042 162 775 2 967 701 - 3 532 205 10 567 223 (IIHFWRIFKDQJHVLQHVWLPDWHV

5HVLGXDOYDOXHV Residual values at 31 March 2011 1 840 021 426 845 1 890 767 5 913 019 - - 10 070 652 Residual values at 31 March 2010 2 117 559 256 341 1 990 657 5 086 520 - - 9 451 077 (IIHFWRIFKDQJHVLQHVWLPDWHV --

(TVY[PZH[PVU ;OLYLZPK\HS]HS\LZHUK\ZLM\SSP]LZVMPU[HUNPISLHZZL[Z^LYLYL]PL^LKK\YPUN[OLJ\YYLU[ÄUHUJPHS`LHYPUSPUL^P[O[OLWYV]PZPVUZVM GRAP 17. The review of useful lives and residual values had the effect of increasing residual values by R94 310; furthermore, this review had an effect of decreasing amortisation by R770 865. INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

4HYJO 4HYJO 9 9 5V[L (J[\HS 9LZ[H[LK *VTTP[TLU[Z

Opening balance 1 415 086 Movement for the period 4 748 366 6 163 452

These commitments relate to the contractual commitments that the Authority had entered into for the acquisition of items of property, plant and equipment as well as intangible assets.

,]LU[ZHM[LY[OLYLWVY[PUNKH[L

;OLYL^LYLUVZPNUPÄJHU[L]LU[Z[OH[[VVRWSHJLIL[^LLU[OLYLWVY[PUNKH[LHUK[OLKH[LPU^OPJO[OLÄUHUJPHSZ[H[LTLU[Z^LYL authorised for issue.

170 171

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2011

:\WWSLTLU[HY`:JOLK\SL[V[OLHUU\HSÄUHUJPHSZ[H[LTLU[Z

>VYSK*\W,_WLUKP[\YL

ICASA did not buy any World Cup tickets or promotional materials. NOTES

172 Contact us: Phone: 27 (11) 566 3000/3001 E-mail: [email protected] Physical Address: Blocks A, B, C and D, Pinmill Farm, 164 Katherine Street, Sandton

RP219/2011 ISBN: 978-0-621-40354-1