Annual Report 2017 - 18 with Barren and Unproductive Land

2 ingonyama trust board | annual report 2017 - 18 with barren and unproductive land. white leaving Zulu the minority nation was dispossessed and given to the Zuluthe nation. A huge amount of land excised land belonging W Stanger toDr General Surveyor then West. The Martin by Leader of British Colony of Natal Commission Boundary Land is formed 1846 HISTORY DISPOSSESSIONINTHEZULU NATION OFLAND without passports. without allowed to move outside of this land nation increasing were and people not of of number the Zulu members the This land did not increase in size despite to land hold traditional under leadership. Natal Native Trust Land 1864 is introduced introduced is work there for security of tenure.work there for security residing in areas those were forced to of Zulumembers the nation who were ofrepublic the whereall of the Vryheid which resultedparties in formation the exchange was two the made between Zuluthe nation. this During time an land of dispossessed the further Convention British and Boer The 1886 Reserves which still exist toReserves date. land thisand declared land asNative awaypushed people from prime further Commission of 1846 Boundary Land Commission Zululand Lands Delimitation 1902 - 1904 - 1902 which was similarto the Ingonyama Trust Act is promulgated The Natives Land Act was introduced to hold the remnants of land that still when the Union of South Africa was remained in the ownership of the zulu established. The aim of this act was to people. This land had been taken relocate black people from farm areas away over the past 148 years of land and sent to Native Reserves. The law dispossession in the Zulu nation. The prohibited the sale of territory in white homeland government collapses and areas to Blacks and vice versa. 1972 a new order comes in. 1998

1913 1994 Ingonyama Trust Board is introduced KwaZulu Homeland Government through the amendment of the is introduced and all land which has Ingonyama Trust Act and brings about been held under Native Reserves is changes which put the Board to transferred to this government. administer the Affairs of the Trust and Trust land. | annual report 2017 - 18 report | annual ingonyama trust board | annual report 2017 - 18 report | annual trust board ingonyama 4 ingonyama trust board | annual report 2017 - 18 ANNUAL REPORT APRIL 2017 REPORT ANNUAL 2018 -MARCH ingonyama trustboard Section A:GeneralInformation

Organisational Structure Executive authority’s Overview About theIngonyama Trust Board the AnnualReport Statement ofresponsibility andconfirmationof accuracy of Chief Executive Officer’s Overview Chairperson’s foreword Message from HisMajestytheKing List ofacronyms General information CONTENTS

16 -20 10 -11 12 -15 30 31 23 22 9 8 Section B : Performance Information Section D : Human Resource Management

Statement of responsibility for Performance Information 34 Human Resources Oversight Statistics 56

Performance Overview of the ITB 35 Section E : Financial Information Performance Report : Programme 1 Administration 36 - 38 Statement of Board’s responsibility for Financial and 62 - 63 Performance Report : Programme 2 Real Estate 39 - 42 Performance Information Report of the Auditor General to Parliament on the 64 - 69 Ingonyama Trust Board Section C : Governance Response of the Ingonyama Trust Board to the Auditor 70 - 72 General’s Report Accounting Authority 46 Statement of Financial position for the year ended 31 March 74 2018

The Board 48 Statement of Financial performance for the year ended 31 75 5 March 2018

Board Committees 50 Statement of changes in net assets for the year ended 31 76 March 2018

Internal control environment 52 Cash flow statement for the year ended 31 March 2018 77

Audit Committee Report 53 Notes to the Financial Statements for the year ended 31 78 - 116 March 2018 Trust Fund Statement of comparison of budget and actual 117 - 119

amounts 2017 - 18 report | annual Transfer Payment Statement of comparison of budget and 120 - 121 actual amounts Consolidated Unaudited Detailed Statement of Financial 122 - 124 performance and budget

ingonyama trust board trust board ingonyama 6 ingonyama trust board | annual report 2017 - 18 GENERAL INFORMATION GENERAL SECTION A 7 | annual report 2017 - 18 report | annual ingonyama trust board | annual report 2017 - 18 report | annual trust board ingonyama 8 ingonyama trust board | annual report 2017 - 18 informationBankers auditors External Website address Email Email telephone Contact numbers address Pietermaritzburg, Postal Address Pietermaritzburg, Address Registered Office Registered name 3200 3201 : :

GENERAL INFORMATION IS B N : 978-0-621-46777-2 : N : : : : : : www.ingonyamatrust.org.za [email protected]

RP :375/2018RP First National Bank First Auditor Africa South General 033 846 9900 846 033 P. O. Box 601, Trelawney65 Road, Southgate, Ingonyama Trust Board LIST OF ACRONYMS

AFS - Annual Financial Statements AG - Auditor General BBBEE - Broad Based Black Economic Empowerment CEO - Chief Executive Officer CFO - Chief Financial Officer DRDLR - Department of Rural Development and Land Reform EXCO - Executive Committee FICA - Financial Intelligence Centre Act FINCO - Finance Committee FMPPI - Framework for Managing Programme Performance Information GIS - Geographic Information System GRAP - Generally Recognised Accounting Practice HR - Human Resources IGR - Intergovernmental Relations Framework Act ITB - Ingonyama Trust Board IT - Information Technology 9 IESB - International Ethics Standards Board for Accountants ISA - International Standards in Auditing KPI - Key Performance Indicator KZN - KwaZulu - Natal MANCO - Management Committee MOU - Memorandum of Agreement MOA - Memorandum of Understanding MPRA - Municipal Property Rates Act MPRRA - Mineral and Petroleum Resources Royalty Act OD - Organisational Development

PAA - Public Audit Act of South Africa 2017 - 18 report | annual PFMA - Public Finance Management Act PPE - Property Plant and Equipment PTO - Permission to Occupy RICA - Regulation of Interception of Communication and Provision of Communication related information Act RSA - Republic of South Africa SO - Strategic Objective SPLUMA - Spatial Planning and Land Use Management Act TC - Traditional Council trust board ingonyama 10 ingonyama trust board | annual report 2017 - 18 D TRUSTEE message fromthe I custom. tomillionsindeed the of who continue my topeople live accordingto tradition and to have 2017, due November of mainly by perceived myself Report been (and many others)as athreat probably to Ingonyama the Panel Trust and Level and High the sphere in information political inaccurate the in comments Unfortunately, hand. tois claims note even more worrying an expert that report the and law and of practice. Thisis even High the more Level obviousin report the Panel. It figures public some from comments institutions, and is the ignorance reports of communal media ownership of land the and the from Zulu customary Evident over, but with, of Kingdom”. AmaKhosi the position in thisMy regard aptly has as put been “...the who reigned King in association from time immemorial. practice the been that strange it I deal land with the in manner the inconsistent with that which has parliament I am the Trustee of the land, my people and AmaKhosi would have found of Act an by and position, law customary with line in that fact the from apart Quite land. the with wish I as do can I if as media the in maligned repeatedly am I land, I Reports, Annual previous to have made clearit that not Ido regard myself contribution of as “owner” the Ingonyama Trust my in that fact the Notwithstanding Ingonyamathe Trust and Board its staff. of Authority I have Executive our which and Minister,Ingonyama Trust of in myself and assured Be Board. of and co-operation respect the our Board as Trust you Ingonyama addressing the of pleasure of the Report Annual first the is This ngonyama T ngonyama ear M adam rust B rust M inister oard A oard nnual R nnual eport for 2017/18 for eport HIS MAJESTY THE KING ZWELITHINI ZWELITHINI KING THE HIS MAJESTY GOODWILL KABHEKUZULU GOODWILL This has lead to a warm response on our part and a subsequent regrettable (iii) Therefore, where the High Level Panel gets the idea that the Ingonyama deterioration in the relationship of the Ingonyama Trust Board and the Rural Trust Board is somehow not responsible to yourself and Parliament is Development and Land Reform Portfolio Committee of the National Assembly. beyond my understanding.

One expects moving forward that a better understanding will have to be rekindled between the respective arms of government. I am hoping, with all the affected There are other matters which could benefit from further explanation/information. parties making an effort we will return to the harmony of the past. Those will be dealt with as occasions arise.

It was very good to receive a visit from the President the Hon Cyril Ramaphosa. He I end by repeating my assurance of co-operation with yourself and recording the gave welcome assurances regarding the integrity of Ingonyama Trust land. I deem it hope that relations with the Portfolio Committee will take a positive turn. my duty, however, to expand on points that were missing from the High Level Panel Report, or were placed in a misleading manner: My thanks go to the Board and its Secretariat for their continued devotion to administering the affairs of the Ingonyama Trust. We are also grateful for the support a) No one is forced to take a residential lease in their own clan. Those that do of the Department of Rural Development and Land Reform. so need the lease document for the purposes of RICA, FICA and to apply for a bank loan. Such a lease does not replace a customary allocation - it May this Report for 2017/18 be tabled in Parliament. actually reinforces it. Only commercial ventures and persons from outside a Kind regards. clan must have leases. 11 Yours sincerely, b) No one is forced to surrender a PTO. PTOs were issued under apartheid regulations applicable only to Black people i.e a racial law. The issue of a PTO would be unlawful under Sect 2 of the RSA Constitution 1996. Hence people are encouraged to move away from this tainted tenure instrument; encouraged not forced. Existing PTOs are protected by Sect 2(8) of the King Zwelithini Goodwill Ingonyama Trust Act 1994 and Sect 25 of the RSA Constitution 1996. ka BhekuZulu King of the Zulu Nation c) (i) Apart from the Chairperson, whom I nominate, the (eight) Board

members are appointed by the Minister of Rural Development and Land 2017 - 18 report | annual Reform. Furthermore, ‘Ingonyama’ is defined as “the Board appointed by the Minister”. It only means Isilo in three procedural matters and in my role as Trustee. The Ingonyama Trust Board is also a scheduled entity under the Public Finance Management Act 1999. ingonyama trust board trust board ingonyama 12 ingonyama trust board | annual report 2017 - 18 throughout much of the contemporary extended culturetwentieth century and American hegemony in the Colonialism in the nineteenth century “Westernpowerin theformof European makes the following observations. ProfessorSamuel P. Huntington Order”, World the of remarking the and In his work“TheClash of Civilizations Here Iusetheword “conflict” guidedly. constitutes SouthAfricanculture. reference to theinherent conflict which brief some make first me let heresay to Before dwelling too much on what I want for wrongThis was soprimarily reasons. Trust wasone of the topical subjects. In the year under review Ingonyama at theriskofrepeating oneself. program remains crucial.Even ifthisis need to continue withthiseducational debate on the subjectmatterI believe the Judging by thequality of the current Trust is. towhat Ingonyama explainand simplify on a daily basis.At thesametimeI try Ingonyama Trust Board (ITB) isfacing to educate the reader of the task which Each year whenIpresent Itry report my chairperson message fromthe as unreasonable andbackward. the person who offersresistance isseen nor somebody in authority. Therefore come fromnecessarily a white person noticeable. WHY? Theattitude doesnot Westernsupremacy not immediately is and racism subliminal the bystander, a then becomes thecentre of conflict. To Any resistancenot tolerated. is This from thosewhowere opposed. supremacy expectingadocileresponse their continue toruling class assert Huntington begins to show. The former rule of law the predictions of Professor foundeddemocracy onequalityand the With the advent of constitutional supremacy. Christian Judeo/ White Western, the on the county inSouth Africa was premised of authority the historically main, the in South Africa restson conflict because I opinethat the richculture of modern institutions and themselves.”reassert beliefs languages, mores, rooted historically indigenous, as follows, culture Western of erosion receding.American hegemonyis The world. European over;colonialism is HONOURABLE MR JUSTICE S J NGWENYA SJ JUSTICE MR HONOURABLE With this brief background, let us According to the report the Panel held As far as I am aware, with regards to examine Ingonyama Trust within the public hearings in all nine provinces to KwaZulu - Natal where Ingonyama context of what is referred to as the receive input directly from the public Trust owns land, this High Level Panel High Level Panel chaired by the former and received written submissions only spent less than a week. This was President and the Deputy President, Mr from individuals and organizations in in Durban. I was invited with the former P.K.Motlanthe. response to calls for submissions. CEO of Ingonyama Trust Board to make a presentation. The Panel’s mandate was to review It is further claimed that it legislation, assess implementation, commissioned reports from experts We attended and made a presentation identify gaps and propose action steps and senior researchers on selected on behalf of the Ingonyama Trust. with a review Among the Panel to identifying members we laws that require noted that Dr strengthening, “Yet in other provinces land similar to the Ingonyama Trust land Aninka Claasens amending or is held in trust by the Minister. The individuals there are no better whose views 13 changing. off than these on the Ingonyama Trust land. about the Ingonyama Trust This Panel was and the institution set up as the Speakers’ Forum which in topic. Furthermore, it is claimed that of Traditional Leadership are well known, turn was funded by the European Union. small consultation round tables and was a member. workshops were held to delve deeper While there are eleven official languages into certain issues. I expressed my misgivings to the in the country, all its proceedings and Chairperson on this. Dr Claasens also recordings were in English no interpreters The substantial record, so it is said, confirmed that she holds certain views were provided. The proceedings were that has been generated by this work is on Ingonyama Trust. There was not conducted in big cities. available online. even a word from the Chairperson on 2017 - 18 report | annual this. The proceedings continued. ingonyama trust board trust board ingonyama 14 ingonyama trust board | annual report 2017 - 18 to theTraditional leader. payments made having and certificate of his having aPermissionto Occupy Ingonyama Trust. Thiswasinspite of outstanding rental fees to the business wasshutdown because d) A businessman described how his disrupted withouttheirconsent. are lives citizens’ poor introduced, are that whendevelopmental initiatives bydevelopmental projects.arguedHe lamented the victimizationof citizens c) A speaker at the KZN hearing substantial reserves. Trustwell-being. The has builtupvery for thecommunitiesortheirmaterial revenue generatedbyused is leases b) There islittleevidence that the subsumed by theshopping centre. and informal or customaryland rights were consulted first obtained the consentof thosewhose having without (for example shopping centres) parties Trusthas leasedland to third external This has givento rise instancewhere the in dealingwiththeland. consult or to obtain community consent therefore no subject to any dutyto itself astheoutright owner of land and regards instances, some Trustin The a) findings: makeamong others report the following thanone otherClaasens herself.The Dr Ingonyama Trustwas compiledby no and recommendationsThe report on There is nowhere, where a third party party can access land which is already third a where nowhere, is There full has protection underthelaw. thereof owner the allotted, is of Isigodi (similarto award). Onceland Indunais (headman) whoisincharge point first the that know will experience Anyone with basiccustomary law Customary lawandanyotherlaw. be administered of Zulu interms providesthat thesubjectland shall to bythe Board. Furthermore theAct This provision isreligiously adhered in charge ofthesubjectpieceland. consent of a prior the Traditional Council Board shallnot encumberland without among otherthingsprovidesthat the following reasons Ingonyama Trust Act for the this I say evidence. artificial on based be to appear above findings The legal systemfrom timeimmemorial. the cornerstone oftheSouth African has been own course be thejudgeinher Secondly theprinciplethatnoonecould the accused. a charge was brought to the attention of it. Even inthedarkest daysof apartheid the Trust ortheBoard were neverput to the accusations levelledFirstly against Act beamended. disestablished. Furthermore that the Panel TrustAct berepealed and the Trustbe the findings recommended thattheIngonyama these on Based encumbered by allocation without the Not one of these community concerned think of their own and do things from their consent of the owner and the approval of grouping wants to spend time educating perspectives. the Traditional Council. the general public of the modern day risk. It is worth noting that the High Level Panel It is thus even more incumbent on the Reports like the High Level Panel one will has not undertaken any comparable study. Ingonyama Trust Board to interact with continue coming and receiving prominence. communities on Ingonyama Trust land This is so because of the failure to Yet in other provinces land similar to the more regular and assist as best as it can to appreciate the changing environment. The Ingonyama Trust land is held in trust by the help people to understand their rights and former victims are no longer victims and Minister. The individuals there are no better how to exercise them. they refuse to be regarded as such. off than these on the Ingonyama Trust land. I hope we shall start the new financial year The foundation of Western White Noting that the wishes of those who can with a greater focus and zeal. Otherwise Supremacy however find it hard to change. no longer tolerate the existence of the the reasons which have been given by the It is a prisoner of its own. It cannot function Ingonyama Trust any longer are unlikely to detractors of the Ingonyama are far less without a slave. Therefore it must insist on be realized soon, I think it is fair to forewarn convincing but have attracted wide media creating slaves when non exist any longer. of their alternative strategy. It is to entice attention because they come from superior people to demand individual title deeds. elitist class. 15 The system of communal living has been there for centuries. In an attempt to destroy The motive there is to promote perpetual In my view Ingonyama Trust has proven to it, its opponent will come in various shapes. indebtedness. Individuals once they get be more valuable to its beneficiaries. Let title deeds they will pledge them with them decide their destiny. It is worth noting that the people who have the loan sharks. At the same time some leases on Ingonyama Trust land are today Municipalities will access land at a bargain less than one per cent. That the High Level upon default of rates. Panel is lost speaks for itself. It speaks about the Trust having accumulated substantial The attitude of those who look down upon reserves. It fails to note the threats on the people living according to both custom and Chairperson of the Ingonyama Trust Board Trust arising from the Municipal property Western ways of living is a great course Honourable Mr Justice Mr S J Ngwenya 2017 - 18 report | annual rates. for concern to me. It is a concern because it undermines the ability of the people to ingonyama trust board trust board ingonyama 16 ingonyama trust board | annual report 2017 - 18 continuous transformation led by that is undergoingcontext of a country Trust Board (ITB) operateswithin the province of KwaZulu – Natal. Ingonyama held undertheIngonyama Trustin the administration of the communal land of governmentresponsiblewhich is for Ingonyama Trust Board (ITB) isan entity dedication andintegrity. professionalism, with mandate its fulfil for steering thisentityin a direction that to acknowledge the Boardit isimportant As a new and on acting capacity as CEO, generations to come. that the land will bekept forthem leadership deriveand security trust on communalareasunder traditional Councils and communities residing land. communities whichis Traditional the onlyassetleftwithtraditional of KwaZulu – Natal and safeguards only intheProvinceentity whichexists the Republic of South Africa. It is an Boardin state a uniqueof the is entity the organisation. Ingonyama Trust an entrustedand rolestrategic in It is mypleasure to on be reporting INTRODUC O ACTING CEO’S VER TION VIEW on thefollowingareas ofimportance. Traditional Councilsand thefocuswas House of Traditional Leaders and Extended KwaZulu – Natal Provincial interactions wereThese done withthe the periodunder review were held. Interactions with aMaKhosi during THE YEARUNDERREVIEW in thisspaceisfacilitatedby theBoard. hence continuous development nature, initiativesthat in rural is operates ITB communities. Theenvironment in which million hectaresof land for thetraditional government. Itholdsapproximately 2.8 MS TPNDLOVU MS - - - on Trust land; and its implications Panel Report Discussions on the High Level Councils andotherforms; between the ITB and Traditional in theprovince through the MOA the ITB and Traditional Leadership Strengthening ofrelations between Bill, Land Communal SPLUMA andMPRA; draft as to Ingonyama Trust land such on legislation relatedDiscussions - Mining Charter and its implications the transactions of the Ingonyama Trust reducing the level of debt. on Trust Land and traditional and not of the Ingonyama Trust Board. communities, and; One of the major issues reported by the The Board complied with the reporting Auditor General in the previous audits time frames for the submission of - Standardisation of the tenure was for the Board to establish a land the Annual Financial Statements and processes on Trust land. value acceptable in terms of Generally Budgets in terms of the PFMA. Recognised Accounting Practice These interactions yielded much needed (GRAP). Great emphasis was placed on improving feedback and outlined the importance supply chain practices which resulted of the ITB to the traditional diaspora in During the year under review, the Board in the non-occurrence of fruitless and unpacking some of the issues related to was able to achieve this milestone at no wasteful or irregular expenditure. them. additional cost to the state and a land value of R 28 billion for most of its 2,8 In promoting good financial governance, As alluded above, the Ingonyama Trust million hectares owned was determined the secretariat achieved a 100 % Board embarked on an organisational and recorded in the Annual Financial performance for payment to creditors development process. Changes in Statements. within thirty days. 17 the organisational environment and ensuring alignment with government Of concern to the Auditor General was The Board sees the audit report as a priorities, called for this crucial also the issue of royalty entitlement by useful mechanism to improve in all endeavour. The process commenced the Ingonyama Trust. During the year, aspects of financial and non-financial from April 2017, with a goal of bringing it fruitful engagements were held with management and reporting in the future. fruition in the 2018/2019 Financial Year. the Department of Mineral Resources paving the way to an amicable solution. STRATEGIC FOCUS AUDIT OUTCOME The focus of the Board in the 2018/2019 year is to develop a plan that will ensure Moving this dynamic organisation to The consolidated audit report noted in royalties held by the Trust are used in a world class status required a clear this annual report takes into account the best interest of its beneficiaries. strategy map which with focus on 2017 - 18 report | annual the Financial Performance and Financial proactive development on Trust land. To Position of the Ingonyama Trust Board The Board is aware of the monies owed this end a strategic planning session was and the Ingonyama Trust. to the Trust by commercial lessees in held with the board and the following this harsh economic climate, is therefore areas of priority were identified: The issues noted in the audit report by exploring the use of stricter methods in the Auditor General pertain mainly to ingonyama trust board trust board ingonyama 18 ingonyama trust board | annual report 2017 - 18 ECONOMI PORTFOLIO ANDPROPERTYLAND MANAGEMENT - - - - - farms; of incubating thecommunitiesto take overthe the centre stageinthiswould include thepossibility taking farms, these resuscitate to strategy KwaZulu government and development of a Analysis of commercial farmsfrom theformer processes. training of Traditional Councils on business Reviewof thetenure application processesand Benefit Scheme and formalisation of this process; transferred to the people through the Housing municipalities, auditing of all properties that were of vested townships of in terms compliance with with municipalitieswhichincludestheanalysis Finalisation of vesting of townshipsthe R293 identified; been have of areas other and Nongoma benefit Ndwedwe, as the such areas for communities, council land traditional of use productive for Proactiveland planning to unlockdevelopment areas andoneswithnotraditionalareas; land and its affairs on areas under traditional were vitalat ensuring the management of Trust implementation and training development,Policy OTHER ECONOMIPORTFOLIOS MINING PORTFOLIO ------commercial opportunities; Improve infrastructure to prime areas for exclusive useof land to individuals or institutions; using existing resources suchasspringwaterand Audit ofallTCs to opportunities establishbusiness Trust landandcommunitybeneficiation. of Mineral Resourcesin respect of mining on Fostermore positive relations with theDepartment resolutions; Imbizo and implement the2015Mining Imbizo Facilitate an mining inclusive sand and quarry KZN Wildlife. Agriculture and Rural Development and Ezemvelo To revisit of the MOA between the Department and; and game reserves buy lodges for the benefit ofto the communities, option first of consideration by givingtheTrustin the hospitality industry Facilitate the entrance of beneficiary communities to communities; thebeneficiary accrues beneficiation the that ensuring and land Consolidation forestryof leaseson existing Trust ROYALTIES audit report: the following measuresto ensure to departure aclean current periodaudit. To thisendwehave putinplace the Auditor Generalin the previous audit and in the to and address try the Adverse Opinion as raisedby To dealwithissuesof Audit we have devised aplan AUDIT TURNAROUND - - - - - deserved attention. deserved Africa on this matterand it isreceivinga well- National Treasuryand Auditor GeneralSouth Wehave with of engagements had a series opinion onroyalties; of firm attorneys to advisetheBoard and provide alegal a appoint to decision a took Board The the affected communities. to them from beneficiation derive and land Trust Protect theheritageland and facilities that are on land; trust on dams from beneficiation community on the damsand engagement of the waterboards Analysis of entities that have acquired rights to sector; meaningfully in thefueland energyParticipate PROPERTY, PLANT AND EQUIPMENT FINANCE MANAGEMENT We are cognisant of the fact that our people remain the most valuable asset in the organisation which is why We are proud to confirm that we are a bankable - The organisation appointed a team of valuers we decided to convert some of the contract positions organisation with a clear financial report. There were to conduct a valuation exercise with the view to we have held for years to permanent status. no misappropriation of funds in this organisation establish comparative values on Trust land based involving staff members and no liability to finance on land use and category and extrapolated the In this conversion we however noted that some institutions. values to similar land parcels within Trust land. of these positions were not catered for in the old This exercise has yielded positive results such organisational structure which is why we decided to Our reputation is that we are a FICA approved entity that we are now able to attach a value to our land revise the organisational structure to align the work with a clear financial report. The Ingonyama Trust in our financial statements moving into the future; that we have with the people that we employ. Board has its own offices and we are not paying rent to a third party. We practice sound financial leadership - Furthermore to this a decision was taken to audit We commit ourselves to continuously develop this with the Board providing the required oversight. all the land under the Trust including land that important asset to fit in the puzzle of creating a world is in the process of being transferred, land left class organisation which will be a benchmark in the The Trust owns its own office accommodation and behind during the process of R293 transfer and communal land space moving into the future. no rental is paid for the Ulundi satellite office. During extent of properties sold by the institutions which the period under review we received R 19,7m as the were holding the Power of Attorney. Ingonyama Trust Board continues to drive departmental transfer payment which was utilised as transformation as part of its agenda, though our follows: 19 ORGANISATIONAL CHANGE & DEVELOPMENT Employment Equity Plan is talking contrary to what we seek to achieve at this moment in time. Our main focus - R 11 m of this amount went to salaries and we As a result of the approval of the new organisational however is on women and people with disabilities. had R 11 m shortfall which was covered using the structure by the Board a lot of change is in the process Trust funds; of moving forward. Part of this process talks to a new A policy review process to support the organisational organisational culture is being instilled amongst the change agenda has been done during this period. Eight members of staff in the organisation. This culture is (8) Policies relating to Human Resource & Development - R 8.7 m of this amount went to goods and based mainly on the values of the organisation which and Debt Management have been under review at services and we had a shortfall of R 4.58m which is professionalism, integrity and customer orientation. Board level and new policies are also being introduced was once again taken from Trust funds. to ensure smooth transition to the desired state. The new organisational structure seeks to restructure 2017 - 18 report | annual the organisation into a world class organisation and Our revenue for the year under review was R 129 m place members of staff in appropriate positions. A which reflects a 11,5 % decline in comparison to the skills audit to identify available skills will be done and previous years. The revenue for the year under review appropriate placement of staff shall follow. amounted to R 129 m. ingonyama trust board trust board ingonyama 20 ingonyama trust board | annual report 2017 - 18 administrative costs. Licence thereDriving their are feesassociated withthatto cover For instance when one goes to the Traffic Department to renew duties relating to landatno costto theclients. compliment ofoverpeople who do avariety55 of administrative to ensure that it isexecuted accordingly. We have astaff This exercise requires a lot of resources and time in order with theadministrationoflandintraditionalareas. The ITBplaying is role acritical inthecommunalland space ITB playsnot understoodis hence thelackof funding thereof. of the organisation. This isdueto thefact that the role that the ofcommunal of ITBinadequate land is to theneeds insupport We have always maintained that the funding for the operations FUNDING OINGONYAMA TRUSTBOARD of commercial debtinrelation to thetotal debt. comprising Trust,% the to85 owed than morem 72 haveR we We are to trying strengthen our debt collection procedures as from leases. miningsurface and terms exploring other ways to generate revenue such as toDue thedeclineinrevenue theBoardreviewing is the lease Ms TPNdlovu Acting ChiefExecutive Officer me andtheSecretariat Team. the table. Thankyou to forchallengingme in bringoutthebest toresources and experience insight, intellect, passion, bringing for Members, Board Trust Ingonyama to gratitude, distinct A Portfolio the to Committee forunremittingly provide oversight andguidance. gratitude warm my extend to wish I Further, professional andguidance. support of Rural Development & Land Reform for the Department their In closing, I would like to thank and place our hearty gratitude to ACKNOWLEDGEMENTS the transfer payment whichismadeto theITB. herebyis Committee and Reform Portfolio made to supplement ofRuralDevelopmentAn appeal to and Land the Department 21 | annual report 2017 - 18 report | annual ingonyama trust board trust board ingonyama 22 ingonyama trust board | annual report 2017 - 18 Hon. M Hon. Trust Ingonyama of the B Chairperson Yours faithfully, financial yearended 31 March 2018. the for entity the of affairs financial the and information resources human the information, performance the operations, the reflects fairly report annual the opinion, our In auditors external The are to engaged express an opinion annual independent the on financial statements. information, and integrity the reliability human of the resources performance the information and annual the financial statements. toas reasonableassuranceprovideto designed been has which internalcontrolofsystem a implementing establishing,and responsiblefor is authority accounting The is responsible accounting for authority The preparation the of annual the financial statements and the for judgements made thisin information. entity. have prepared Accounting Generally with in the (GRAP) Recognised E) accordance been Practice standards AnnualFinancialThe Statements applicable (Part to public the prepared as has guidelines in issued with the accordance by been annual the annual on NationalThe report report Treasury. is complete, accurate annualThe report and is from any free omissions. informationAll and amounts is consistent disclosed in annual the report annual with the financial statements audited the by AuditorGeneral. To of best the my and belief, knowledge the following: Iconfirm r Justice S JNgwenya r Justice STATE ANDCONFIR MATION OFACCURACYTHEANNUAL REPORTMENT OFRESPONSIBILITY oard M Officer Executive Chief Acting s TPNdlovu OUR VALUES

about ingonyama trust board Transparency

Service Excellence VISION

Consultation To become a leader in sustainable communal land management.

MISSION Open Communication

To contribute to the improvement of the quality of life of the members of the traditional communities living on Ingonyama Trust land by ensuring that land Value for money management is to their benefit and in accordance with the laws of the land. 23 To develop progressive business models for the social and economic upliftment and the empowerment of the members of traditional communities on land administered Professionalism by the Trust.

Honesty VALUE STATEMENT

We uphold the following values: Integrity

- We value and encourage diversity and will not discriminate against anyone; 2017 - 18 report | annual Non - discrimination - Smallholder farmer development and support (technical, financial, infrastructure) for agrarian transformation; - We shall ensure that we have a dedicated, loyal, results-oriented, professional INGONYAMA TRUST BOARD STRATEGIC OUTCOME ORIENTED and people-focused workforce; GOAL - In collaboration with all stakeholders, the organisation will comply with all To administer the affairs of the Trust and Trust land. These i.e. Trust and Trust land laws of this country. must be administered for the benefit and welfare of the beneficiaries identified in

the schedule to the Act. trust board ingonyama 24 ingonyama trust board | annual report 2017 - 18 termsof Interim the and Constitution constitutionalthe requirements both in had Act to allThis Amendment meet Act a new Act. albeit Amendment called the was product final the that was reviewed comprehensively such enabling creating Act Ingonyama Trust Interim ofConstitution 1993original the into existence initially in terms of the the democraticWhen government came land.the of and living communities” tribes the on welfare of material members and the social well-being benefit, “the for land mandateThe of Trust the was to hold to KwaZulubelonged the Government. all land the that owned was or hitherto hold to 1994) of 3KZ No (Act TrustAct, in terms of KwaZulu the Ingonyama by KwaZulu erstwhile the Government Ingonyama Trust was established in 1994 ABOUT INGONYAMA TRUST n csoay a, ujc to of and constitution provides the that law subject providesConstitution for supremacy the law, 2 of the Section constitution. the customary and institution of traditional leadership 211Section and 212 recognise the Ingonyama Trust expression. find 1996) and environment the context in which of 108 No. which are in crucial toorder grasp the (Act 1996 Africa, ofConstitution Republic the of South areThere at least four provisions in the LE Trust Trust and the land. toBoard administer affairs the of the for establishmentthe of Ingonyama Trust things, other among provides, Act Trustee of Amendment land. the The His is King the sole the Majesty Constitution final the of 1996. G AL CONTEXT AL CONTEXT as sole trustee.The enabling was Act of land the His under King the Majesty depicts the clans which are beneficiaries few pages in schedule next the The Ingonyama Trust. is King Trustee only the the Hence of to in King terms the of law. customary who in turn are responsible (AMAKHOSI) leadershipthe of Traditional Leaders land is according divided to clans under in terms of Zulu law. customary The nominal owner of is administered the mainly is Trust the which land the Firstly, of constitution. the provisionsquoted 25 above and Section finds existence expression and protection the under its Constitution, the While Ingonyama the Trust predates fulfilled. be and obligations the by imposed must it inconsistent conduct or isinvalid, it with Continued to 25 Page Continued DISTRICT NAME OF TRADITIONAL COUNCIL / COMMUNITY DISTRICT NAME OF TRADITIONAL COUNCIL / COMMUNITY

EMNAMBITHI CUNU / MCHUNU ENSELENI BIYELA / KWAYANGUYE INGWE BIYELA / OBUKA KUNENE CEBEKHULU / OBIZO MABASO KHOZA MBHENSE MBONAMBI (MAXWELL) MTHEMBU MTHEMBU / SOMOPHO NXUMALO NDHLAZI / MAMBUKA SITHOLE ZULU / NTEMBENI ZUNGU / MADLEBE EMZUMBE BHEKANI MTHETHWA / MHLANA CELE M CELE P EZINGOLWENI CELE DLAMINI / VUSATHINAMAZULU DLAMINI / KWAFODO DUNGE / AMADUNGE DUMA / THOKOZANI MADUMISA EMBO / SIZWE HLANGANANI JALI / NHLANGANO MBHELE MACI / ISIBONDA MJOLI / SIZWE MAVUNDLA / MVUNDLA NDELU MBOTHO / MAMBOTHO 25 NHLANGWINI MTHIMUDE NYAVINI NSIMBINI QOLOQOLO NZIMAKWE HLONGWA SHWAWU / JABULANI BESHWAYO HLUBI XOLO KHOLWA / SIZWE HLANGANANI SHWAWU / BESHWAYO MADZIKANE / SIZWE HLANGANANI NYUSWA / QINISELANI MANYUSWA LUSHABA MADADENI GULE / NYANYADU MADLALA HLUBI / BUHLE – BOMZINYATHI COMMUNITY QWABE P AUTHORITY | annual report 2017 - 18 report | annual QWABE Z MANGWENI / BUHLE – BOMZINYATHI COMMUNITY THULINI AUTHORITY ZIZI - SIZWE / HLANGANANI KUBHEKA / BUHLE – BOMZINYATHI COMMUNITY AUTHORITY HLABISA ABAKWA HLABISA NKOSI / BUHLE – BOMZINYATHI COMMUNITY MDLETSHE MPEMBENI MPUKUNYONI / MKHWANAZI ingonyama trust board trust board ingonyama 26 ingonyama trust board | annual report 2017 - 18 IN INKANYEZI HLAN GW AV G ANANI DISTRICT U M A TEMBE NYAWO MNGOMEZULU MATHENJWA SIKHONYANE SHANGE NTULI MPUNGOSE MATHONSI KWAMONDI KHOZA KHOLWENI /NDLANGUBO BIYELA /MVUZANE BIYELA /MOBENI BIYELA ZULU BHEKESHOWE ZULU BANGINDODA GWALA PEPETA /UMACALA NXAMALALA NGWANE /AMANGWANE /VUKANI NDLOVU /ISIMINZIMOLIFE /VEZOKUHLE MKHULISI /SIZANANI MEMELA /BHACA MADZIKANE /AMAKUZE KUZENI KHOLWA /VUMINDABA KHOLWA /ISIBONELO ESIHLE /MAGUSWANA DUMISA ESIPHAHLENI / DLAMINI /BIDLA DLAMINI /ZASHUKE BOMVU BATLOKOA /BASOTHO NA M E OF TRADITIONAL COUNCIL /MM CO E OF TRADITIONAL UNITY NON M M AHLA APHUMULO G OM DISTRICT BATHINI A ZULU /USUTHU ZULU /MATHENI ZULU /MANDLAKAZI ZULU /KHAMBI ZUNGU XIMBA AUTHORITY COMMUNITY NOBAMBA NDEBELE MPUNGOSE MBATHA EMPITHIMPITHINI - BUTHELEZI BUTHELEZI ZULU /NODUNGA /MTHEMBU SITHOLE QWABE QADI /MKONTO /HOHOZA NTULI NTANZI NGCOLOSI /MASIHAMBISANE NDLOVU /MTULINI NTULI / SITHOLE MTHEMBU /NYUSWA MLAMULA MABOMVINI LUTHULI KHABELA HLONGWA GCWENSA EMBO W BOMVU A BOMVU /MBEDU AMAMBEDU ABAKWA ZUBANE ABAKWA CELE NA M E OF TRADITIONAL COUNCIL /MM CO E OF TRADITIONAL UNITY DISTRICT NAME OF TRADITIONAL COUNCIL / COMMUNITY DISTRICT NAME OF TRADITIONAL COUNCIL / COMMUNITY

MSINGA BASO NKANDLA AMAKHABELA BOMVU BIYELA / AMAHLAYIZENI CHUNU BIYELA / MANGIDINI MTHEMBU CUBE NGOME CUNU QAMU IZIGQOZA KHABELA NDWEDWE CHILI KHANYILE / EKUKHANYENI CIBANE KHANYILE / IZINDLOZI EMALANGENI / LANGA MAGWAZA EMBO / KWAKHABAZELA MBHELE / AMAPUTO INKUMBA / NYUSWA MPUNGOSE HLOPHE NTULI / GODIDE KHUMALO NTULI / NGONO MANGANGA NXAMALALA MTHEMBU SIBISI / CWEZI NGCOLOSI XULU NGONGOMA / MAVELA ZONDI 27 NODWENGU PHEPHETHA NQUTHU HLATSHWAYO QADI JAMA QINISELANI MANYUSWA MDLALOSE / HLAHLINDLELA QWABE MNCUBE / MBOKODWEBOMVU SHANGASE MOLEFE WOSIYANE NGOBESE / KHIPHINKUNZI NGWE / MANGWE – BUTHANANI MPUMALANGA DASSENHOEK COMMUNITY AUTHORITY NTOMBELA EMBO SITHOLE / VULINDLELA

FREDVILLE COMMUNITY AUTHORITY ZONDI 2017 - 18 report | annual ILANGA COMMUNITY AUTHORITY ZONDO GCUMISA ZULU / EMANDLENI MAPHUMULO MDLULI / MANYAVU ONGOYE DUBE SHANGASE MKHWANAZI XIMBA MZIMELA CAMBINI NZUZA

ZULU trust board ingonyama 28 ingonyama trust board | annual report 2017 - 18 U U OKHAHLA SI MB B G MDLAN O MB U MB DISTRICT O ULU MB ENTSHA A TOYANA MAPHUMULO /VUMAZONKE MANGANGENI MAKHANYA / SOBONAKHONA /UMNINI T LUTHULI /VUMUKWENZA EMBO /TIMUNI EMBO ISIMAHLA /NKASA EMBO /VUMANGAZI CELE ZIKHALI /MBILA ZIKHALI QWABE /MAKASA SIQAKATHA NIBELA /NSINDE MYENI /NGWENYAMYENI MNQOBOKAZI MASHABANE /JOBE MANUKUZA MABASO NGWE /AMANGWE NGWANE /AMANGWANE MHLUNGWINI MABASO EMBO HLUBI DLAMINI AMAZIZI SIMELANE AUTHORITY SIBIYA COMMUNITY –MASIDLA NTSHANGASE MTHETHWA MSIBI AUTHORITY COMMUNITY MTUNGWA –MASIDLA AUTHORITY COMMUNITY –MASIDLA MAVUSO M DLAMINI DLAMINI NA M E OF TRADITIONAL COUNCIL /MM CO E OF TRADITIONAL rust UNITY V V ULINDLELA ULA M EHLO DISTRICT ZONDI /MPUMUZA ZONDI /INADI XIMBA NXAMALALA FUZE ZEMBENI /ZEMBE ZEMBENI NYUSWA NHLANGWINI / SHIYABANYE /KWALEMBE MBHELE /UKUTHULA EMBO LOKUSA /KHWEZI EMBO N DUMISA M DUMISA CELE /QIKOBELE NA M E OF TRADITIONAL COUNCIL /MM CO E OF TRADITIONAL UNITY Continued from Page 20 amended in 1997 to create a Board separate from of a legislation to strengthen land right ownership the Trust to administer the trust and its assets to address past historical racial inequalities, it is which include land. This amendment tried as far submitted that land beneficiaries of Ingonyama as possible to align itself with the practice under Trust land can have access to such protection customary law. The King for all practical purposes even currently. is relieved of all hands on administration. This is left to Board members none of whom is a trustee. The Ingonyama Trust land is still the most economically accessible land in the province. Communally the land is owned by the clans as a However, due to population exponential growth collective in respect of each demarcated area. In strong measures are to be applied in land allocation turn each member of each clan is entitled through by the Traditional Councils on the ground. 29 the procedures under customary law to have ownership of his/her allotment. For this to happen, the Ingonyama Trust Board needs to expedite policy formulation and cascade The land which Ingonyama Trust owns, is the it to the Traditional Councils sooner than late. property envisaged in Section 25(1) of the constitution. Thus while not each and every The Trust mandate is not confined to land member of the beneficial clans has a registered ownership only. It is entitled to do anything which title deed in respect of his/her allotment, such a corporate body may do, subject to the enabling ownership is protected by the law. legislation. While Section 25(6) provides for the enactment | annual report 2017 - 18 report | annual ingonyama trust board trust board ingonyama 30 ingonyama trust board | annual report 2017 - 18 The Honourable Nkoana- financial year. not satisfactory.at an optimum will that Iamhopeful levelITB the perform in next the of organisation the asmuch performance the As against itsstrategic objectivesis space into rural the hubs. viable economic organsthe of state and private sector to leverage resources in pursuit to transform areasrural land. This calls traditional under for is leaders dry collaboration between residing in areas rural of KwaZulu -Natal Province. We that understand land the in the people the of lives the transform to seek should ITB the government, Togetherwith solutions to land the issue in our country. lasting for search the in role leadership a play should which ITB, the is process this interest best the of impoverished the masses of A key our people. stakeholder in all lodestar,our objective, stakeholdersthatareourappropriately and remains engaged that imperative is it issue, this addressing In ownership. land and land of issue In this we context have to mindful be that issue the of day the is intractable the life for all. This challenge more and is urgent becoming matures. as our democracy objective collective Our must to be lives change the of and ensure our people a better with Ingonyama in partnership development, Trustand economic Board. Traditional The sector. public and Councils play in role a critical at level private a local in ensuring equitable allocation of land from both projects, catalytic other and through building Thisthe development occurs purposes. economic of infrastructure Part of the administration of the affairs of the Trust, includes issuing of rights to land for affairsthe of Trust the situated land, and trust in KwaZulu- Natal. Trust.the I greatly appreciate work of the Ingonyama the Trust in Board administering of achievements and challenges workings, inner the with myself acquainted have I and as a responsible consequence, the Authority Executive for the Ingonyama Trust, In the time since my appointment as Minister of Rural Development and Land Reform, M inister of Rural Development and Land Reform Land and Development Rural of inister E AUTHORITY’S O EXECUTIVE AUTHORITY’S Mashabane, M E ( MP) VER VIEW M inister of Rural Development and Land Reform Land and Development Rural of inister EXECUTI V E AUTHORITY Ingonyama Trust

Ingonyama Trust Board

HIS MAJESTY THE KING SOLE TRUSTEE OF INGONYAMA TRUST

Head of Secretariat 2017 - 18 report | annual

Land and Tenure Corporate Services Financial Management Management ingonyama trust board trust board ingonyama 32 ingonyama trust board | annual report 2017 - 18 PERFORMANCE INFORMATION PERFORMANCE SECTION B 33 | annual report 2017 - 18 report | annual ingonyama trust board | annual report 2017 - 18 report | annual trust board ingonyama 34 ingonyama trust board | annual report 2017 - 18 Hon. M Hon. Trust Ingonyama of the B Chairperson against of objectives information set for department the financial the In myyearended performance fairly the performance 31 the March opinion, reflects 2018. information. of reliability and performance integrity to the provide reasonable about assurance Therefore, the information isreported a product of established internal policies, procedures and controls related to the management of informationperformance designed Information,Managing Programme issued Performance by National the Treasury. (a) of Public the No. Act 1of Finance Management Act, 1999, Chapter 18 18.3.1 section (b) of Treasury Regulations and Chapter 6of National the Treasury Framework for IngonyamaThe Trust against predetermined objectives its requirements with in performance on the accordance (3)(a) of prepared Board report 40 the sections and (2) 55 r Justice SJNgwenya r Justice STATE FORPERFOR MANCE INFORATION MENT OFRESPONSIBILITY oard M Officer Executive Chief Acting s TPNdlovu PERFORMANCE OVERVIEW OF THE INGONYAMA TRUST BOARD

INTRODUCTION As a result of this revision there were Key Performance Indicators which were introduced in anticipation of more work as a result of the organisational change The Strategic Plan 2015 - 2020 of the Ingonyama Trust Board was developed with that was taking place. the support of the Department of Rural Development and Land Reform. It is aligned to Outcomes 7, 8 and 12 of the MTSF through contribution to the following priorities. The change incorporated the collapse of the Land Management, Rural Development and Traditional Support programmes into one which is Real Estate. Most of the Key Performance Indicators which were loaded into these programmes were split - Improved land administration and spatial planning for integrated development between the Administration and Real Estate programmes and some new indicators in rural areas; were also introduced to cover some aspects which were seen to be critical for purposes of performance. - Improved food security; PERFORMANCE TRENDS

- Smallholder farmer development and support (technical, financial, In pursuit to align the performance indicators with the mandate of Ingonyama Trust infrastructure) for agrarian transformation; Board (ITB), these were revised. Eleven (11) performance indicators were added in 35 the 2017/2018 under review. This saw an increase in the performance indicators - Increased access to quality basic infrastructure and services, particularly in from 29 of 2016/2017 to 40 of 2017/2018. In Programme 1 : Administration there education, healthcare and public transport in rural areas; and was an increase of 3 Performance Indicators. Of the 18 performance indicators for Programme 1 set for the year under review, 7 were achieved.

- Growth of sustainable rural enterprises and industries characterised by In Programme 2, of the 22 performance indicators, 7 were achieved. The overall strong rural – urban linkages, increased investment in agro-processing, trade performance achieved during the year under review is 35% against 87% achieved in development and access to markets and financial services resulting in rural the 2016/2017. A sharp and concerning decline of 52% is depicted. job creation. Whilst the Board have worked relentlessly around the finalisation of the New Organogram, Skills Audit and Placement, unforeseen and uncontrollable | annual report 2017 - 18 report | annual During the period under review there was a substantial revision of the Annual circumstances obstructed the performance as a whole. Performance Plan based on a change in the priorities of the Board and the splitting of the two entities which is the Ingonyama Trust and Ingonyama Trust Board. ingonyama trust board trust board ingonyama 36 ingonyama trust board | annual report 2017 - 18 STRATE The administrationThe of programme comprise following: the PROGRA and financial management is purpose to the to services The provide logistical strategic support leadership, corporateTrust. services, PURPOSE PROGRA The followingThe are strategic the objectives of Programme 1:Administration. ------Financial services. Financial administration;General and, - - - Management; Board; To improve customer relationship. Provision of and, skills development to delivery; improve service To management in ITB; ensure performance To ensure of reduction vacancies; To ensure internal that efficient resource management is aligned legislativeto requirements; to improveProvide support IT efficiency; Ensure effective stakeholder engagement and communication; Provide monitoring effective and evaluation systems to Ingonyama the Trust Board; G MM MM IC OB E STRUCTURE E 1 Information Technology (IT); Legal services; Communication; JECTI V ES :

AD M INISTRATION performance inforationperprogramme the Department is not sufficient to defray all operating expenditure of the Trust, therefore the Trust utilised its own income as income own its utilised Trust the therefore Trust, the of expenses. 38 pay for to page on reflected expenditure operating all defray to from sufficient not received is payment The Transfer Department thereon. the incurred expenditure and received Payments Transfer reflects Statement This : Note Note : This Statement reflects Transfer Payments received and expenditure incurred thereon. The Transfer payment received from the Department is not sufficient to defray all operating expenditure of the Trust, therefore the Trust utilised its own income as reflected on page 38 to pay for expenses.

programme 1 : administration

STRATEGIC OBJECTIVE PERFORMANCE INDICATOR BASELINE TARGET ACTUAL AUDITED VARIANCE REASONS FOR VARIANCE (ACTUAL OUTPUT) 2017 / 18 ACHIEVEMENT 2016/17 2017/18 1.1. Provide effective Mid - term reviews held and 1 1 1 0 None monitoring and reports completed evaluation systems to Staff training on the monitoring New indicator 3 0 -3 This has been deferred the Ingonyama Trust and evaluation framework until the new organogram Board has been finalized and the skills audit has been undertaken 1.2. Ensure effective Customer service charter New indicator 1 0 -1 - Draft implementation stakeholder engagement implementation plan in place plan in place circulated for and communication comments - Process delayed due to the draft organogram review 37 Stakeholder engagement plan New indicator 1 0 -1 - Draft plan in place in place engagements are ongoing Number of Communication 0 12 3 -9 Board redefined the target reports submitted to the Board Number of workshops with New indicator 3 14 +11 Workshops held as a amakhosi result of the demand from amaKhosi 1.3. Provide IT Support Audited IT infrastructure of the 0 1 0 -1 Draft audit implementation

to improve efficiency ITB plan in place pending 2017 - 18 report | annual approval by the Board

Bi annual check of software 2 2 2 0 None compliance concluded Implementation plan for the New indicator 1 0 -1 Draft implementation plan IT policies developed and reviewed incorporating approved by the Board comments ingonyama trust board trust board ingonyama 38 ingonyama trust board | annual report 2017 - 18 relationship 1.8. To improve customer delivery improve service 1.7. to Provision of skills IT in management performance 1.6. To ensure of vacancies 1.5. To reduction ensure requirements to legislative is aligned resource management internal efficient 1.4. To that ensure STRATE G IC OB JECTI B V E asset register asset assetsto in the recorded be Percentage of all movable plan in relation toHR provisioning the filled posts of Percentage receipt in finance invoices within days 30 of Payment of undisputed performed ofNumber Internal Skills Audit timeously agreements concluded Percentage of Performance by the Board HR provisioning plan approved by the Board of Number policies reviewed programmes conducted programmes ofNumber training by the board traditional councilsapproved of Number with MOAs PERFOR M ANCE INDICATORANCE programme 1:administration( (ACTUAL OUTPUT) New indicator New ASELINE BASELINE 2016/17 100% 100% 97% 94% 14 1 4 7 2017 / 18 / 2017 TAR 100% 100% 100% 100% 10 10 1 6 1 G ET ET continued) ACTUAL AUDITED AUDITED ACTUAL ACHIE 2017/18 100% 100% 93% V 0 0 1 4 2 - E M ENT ENT V ARIANCE -100% N/A -7% 0% -6 -6 -8 -1 0 Managers of absence the Senior the notCould in included be outsource this function topolicies decided Board of planned some the specialised nature of a result As of the None None the new organogram new the of finalisation the pending suspended This hasbeen Capacity constraints Capacity candidatecorrect Inability to attract the REASONS FORREASONS V N/A with skills required skills with Training aligned not needs ARIANCE PROGRAMME 2 : REAL ESTATE

PURPOSE

The purpose is to provide a secure tenure right and establish a comprehensive land tenure information system.

PROGRAMME STRUCTURE

The land management programme comprise of the following:

- Provision of formal tenure rights; and, - Maintenance of Land Tenure information system.

STRATEGIC OBJECTIVES

The following are the strategic objectives of Programme 2 : Land Management.

- Provision of secured tenure rights to facilitate development on Ingonyama Trust land; 39 - To maintain an intergrated and comprehensive land tenure administration system / (database of land tenure rights); - Making trust land available for infrastructure development at district municipality level; and, - Ensure legal occupation of trust land. | annual report 2017 - 18 report | annual ingonyama trust board trust board ingonyama 40 ingonyama trust board | annual report 2017 - 18 investment on IT land IT on investment attracts which planning land sustainable To2.3. ensure rights) tenure system (database of land administration tenure land comprehensive and intergrated an To2.2. maintain land IT on development to facilitate rights tenure 2.1. Provision of secured STRATE G IC OB JECTI V E approved by Board the ofNumber land tenure rights commercial use valuated of Number land parcelsfor various traditional councils allotment adopted practices by landResearch on conducted with development plans ofNumber Traditional Councils Updated land holding register approvedand TenureLand Policy developed PERFOR M ANCE INDICATORANCE programme 2:REALESTATE (ACTUAL OUTPUT) New indicator New New indicator New indicator New ASELINE BASELINE 2016/17 1058 38 4 2017 / 18 / 2017 TAR 1400 9 1 4 4 1 G ET ET ACTUAL AUDITED AUDITED ACTUAL ACHIE 2017/18 715 V 1 4 - - - E M ENT ENT V ARIANCE 685 -8 -4 -1 -1 - survey TCs discovered during - Duplicate allocations by issues related - Change in policy and skill specialized requires This Financial Statements. Financial Annual 2017/2018 the in valueswhich is reflected municipal landon based has valuedITB allThe - properties. municipal values for these move- The isto use N/A 2018/2019. 2018/2019. plan for operation planning land draft the are- These in included Thulini, Bidla) Mpungose, (Macambini, plans will prepared be for: - It was envisaged that procedure given to Tenure- Priority circulated for comments policy in place - Draft REASONS FORREASONS V ARIANCE programme 2 : REAL ESTATE (continued)

STRATEGIC OBJECTIVE PERFORMANCE INDICATOR BASELINE TARGET ACTUAL AUDITED VARIANCE REASONS FOR VARIANCE (ACTUAL OUTPUT) 2017 / 18 ACHIEVEMENT 2016/17 2017/18 2.3. To ensure Number of Spatial Development New indicator 3 1 -2 - The process for the sustainable land Plans on strategically located development plans is planning which attracts land ongoing but not yet investment on IT land complete. - There are draft layout (contd) plans for eNyokeni, Newcastle, Mpophomeni and White City. Number of development New indicator 1 - -1 Engagements have agreements with municipalities been undertaken with municipalities however no feedback has been received 41 A report identifying prime land New indicator 1 1 - N/A developed and approved by the Board 2.4. Provide support to Board approved plan on 1 1 1 - N/A beneficiary communities agriculture production on trust to improve food security land Number of potential project 1 1 1 - N/A of high commercial value for partnership with private sector identified and implemented | annual report 2017 - 18 report | annual Number of agricultural projects 12 12 * 12 - N/A approved by the Board 2.5. Ensure intergration A comprehensive plan based New indicator 1 - -1 Workstreams and mining related to mining on the recommendation of the forum not fully functional for sustainable rural 2015/16 mining Imbizo development on IT land Auditing of all mining activities New indicator 1 1 - N/A ingonyama trust board trust board ingonyama

* This refers to 12 ongoing projects which were approved during the 2016/2017 financial year. 42 ingonyama trust board | annual report 2017 - 18 values culturalcohesion and 2.9. of social Promotion communal land on living people young for development Facilitate skills 2.8. Traditional Councils 2.7. Provide training to land IT on developmenteconomic 2.6. To facilitate STRATE G IC OB JECTI V E trained ofNumber Traditional Councils Board Training plan approved by the developed and approveddeveloped programmessocial cohesion Framework supporting on granted of Number educational awards related land on legislation based Skills Audit performed developments forscorecard commercial adherence to BBBEE ITB Monitoring complianceand approved and costed developed, rights, landon with development plan implementation An with the findings of the land audit the of findings the with submitted and obtained in line Development rights application PERFOR M ANCE INDICATORANCE programme 2:REALESTATE (continued) (ACTUAL OUTPUT) New indicator New indicator New indicator New New indicator New ASELINE BASELINE 2016/17 111 11 0 0 2017 / 18 / 2017 TAR 120 12 1 1 1 3 1 3 G ET ET ACTUAL AUDITED AUDITED ACTUAL ACHIE 2017/18 43 V 1 ------E M ENT ENT V ARIANCE -77 -12 -3 -2 -1 -1 -1 -1 process. Tenure the of finalization dependent on the trainingThe plan is Capacity constraints Capacity with the strategic objective. indicatorwas not in line and year, discontinued as the current the in with proceeded been This could not have This is to outsourced be dependent 2.3. on SO: Not achieved as is it REASONS FORREASONS V for bursaries requests traditional council Indicatordependent on relevancy being reviewed todue its of was scorecard the implementation The dependent 2.3. on SO: Not achieved as is it ARIANCE 43 | annual report 2017 - 18 report | annual ingonyama trust board trust board ingonyama 44 ingonyama trust board | annual report 2017 - 18 SECTION c GOVERNANCE 45 | annual report 2017 - 18 report | annual ingonyama trust board | annual report 2017 - 18 report | annual trust board ingonyama 46 ingonyama trust board | annual report 2017 - 18 M B governance following the created has Board structures: the efficiencies operational For In line mandate, with its statutory is Board the responsible for: Finance Public the of terms in (PFMA). Act Management entity public 3A schedule a is which Board”, “the IngonyamaThe Trust is administered Ingonyama by The the Trust (ITB) Board B THE ------oard Committees anagement Committees anagement Bursary Committee. Bursary Bid Adjudication Committee; Bid Evaluation Committee; Committee; Bid Specification MANCO; Audit Committee. (FINCO);Finance Committee Human Resource and Organisational development Committee; of (EXCO); Board the Committee Executive leadership the under of in province. the Amakhosi Provideleadership to and policydirection in matters communalpertaining land of organisation the operational performance and Trust;Oversee the Providing strategic leadership for management of Trust land; OARD ACCOUNTING AUTHORITY very limiting asubstantial and hence very review of organogram the is underway. areThese all by headed It Head is the of felt Secretariat. the that this structure is current structure of isThe as Secretariat the follows: mandate.its is administrative the Secretariat The enterprise through which discharges Board the SECRETARIAT THE Advocate. V.Z. Mngwengwe (Ministerial representative) Dr. Mbatha M.S. Shabalala Inkosi S.E. Inkosi Z.T. Gumede Inkosi P.R. Bele Inkosi T.W. Mavundla Shabalala B.L. Mr Advocate W.E.R Raubenheimer Ms J.T. Chairperson) (Vice Bhengu Ngwenya Mr Justice S.J. Hon. (Chairperson -Royal nominee) Trustee) Sole His (Statutory King the Majesty of is Board comprised following the The members. - - - Real Estate. Real Finance, and; Administration; General Administration Traditional Council Support

The General Administration component provides administrative support services to The objective of the programme is mainly facilitating skills development to the the Board, and the Secretariat as a whole. Traditional Councils through:

The core functions of this component include: - Training traditional councils on various aspects on matters pertaining to land; - Management of bursary programme to youth in rural areas. - Fleet management, logistics, registry and reception; - Human resources. Finance

Real Estate Financial Administration consists of providing financial accounting, budgeting, regulating compliance and risk management services to the Ingonyama Trust The Real Estate Department has a number of sub – programmes. These are Land Board to ensure that the asset of the Trust which is principally land, is administered and Asset Management, Rural Development and Traditional Council support. professionally and its finances well protected. Among the main functions, the Finance Department has the following responsibilities: Land and Asset Management - Ensure that all moveable assets of the Board and the Trust are well documented Land Management includes tenure allocation and liaison with the communities and and accounted for; Traditional Councils. Asset Management in this context entails the management of immovable property register amongst others. Further and additional activities of - Ensuring that sound financial administration policies are in place; 47 these components include the following. - Establishing of sound internal controls and regularly maintaining them; - Development of land management policies and implementation; - Ensure that all creditors of the Board and the Trust are timeously paid. - Processing of tenure right applications on land; - Making inputs to various government legislation and policies dealing with land matters; - Land surveying and Geographic Information System (GIS).

Rural Development 2017 - 18 report | annual

The objective of the programme is to facilitate and coordinate rural development through various community projects. These range from agricultural projects to small town developments and human settlements. ingonyama trust board trust board ingonyama 48 ingonyama trust board | annual report 2017 - 18 His Majesty the King (Trustee) King the Majesty His THE BOARD Committees: Committees: (Chairperson and Royal and (Chairperson SJNgwenya Mr nominee) (Vice Chairperson) (Vice JTBhengu Ms EXCO, &OD, Tenure HR EXCO, &OD, Tenure HR Dr M S Mbatha Advocate W E R Raubenheimer Mr B L Shabalala Advocate V Z Mngwengwe Committees: EXCO, Finance, Audit, Committees: EXCO, Finance, HR & OD, Tenure Committees: EXCO, Finance, Tenure Tenure, Audit Ministerial appointee 49 | annual report 2017 - 18 report | annual ingonyama trust board trust board ingonyama Inkosi W T Mavundla Inkosi S E Shabalala Inkosi P R Bele Inkosi Z T Gumede

Committees: EXCO, Finance, Tenure Committees: EXCO, Tenure Committees: EXCO, Tenure Committees: EXCO, Tenure 50 ingonyama trust board | annual report 2017 - 18 * Denotes alternate members of the EXCO of the members alternate * Denotes and following the were members Board in attendance. below. review under following the period the During were meetings held by EXCO isconstituted and by 2alternate EXCO members 6 core The as tabled members is responsibleEXCO for: operational in implementation the of Board’s the mandate. review under revised to during period since the been address matters which are of has Board the always Committee It has Executive a Committee. Board The been EXECUTI - - *Inkosi T.W. Mavundla *Inkosi S.E. Shabalala *Inkosi S.E. Inkosi P.R. Bele Shabalala B.L. Mr M Adv W.E.R.Adv Raubenheimer Ms J.T.J. Chairperson) (Deputy Bhengu representative) Advocate. V.Z. Mngwengwe (Ministerial Inkosi ZTGumede Mbatha M.S. Dr Ngwenya Mr Justice S.J. Hon. (Chairperson) ember the Board’s policies between sittings of sittings Board. the Board’sthe policies between To generally manage the Trust land in terms of the Act, Government policy and To deal withdelegated any matters specifically Board;it to the by V EMM CO ITTEE OF THE B ITTEE OARD (EXCO) meetings meetings attended B 12/13 12/13 12/13 13/13 13/13 11/13 4/13 8/13 8/13 7/13 oard BOARD COMMITTEES meetings meetings attended EXCO EXCO 2/5 2/5 0/5 0/5 5/5 5/5 3/5 3/5 5/5 5/5 Board. Board. the to management financial sound to relate which matters address to Board the (FINCO) Committee Financeof isThe Board the of a newly established committee MM CO FINANCE HU and following the were members Board in attendance. review under following the period the During were meetings held by this committee is constituted as by below. tabled Committee HR &OD 4members The is responsibleThis committee for: the Board. matterswhich relateto development of the of aworld classin support Secretariat Committee) of is Board the a newly of established to Board the committee address Human ResourcesThe and Organisational (HR OD & Committee Development - - Mr B.L. Shabalala B.L. Mr W.E.R.Adv Raubenheimer J.T.J.Ms Bhengu Ngwenya Mr Justice S.J. Hon. (Chairperson) M ember M Resources for ITB. the Providing leadership and to policy direction in matters Human pertaining Ingonyama Trust Board; Provide leadership of in of process the Secretariat the the structuring AN RESOURCESAN OR AND ITTEE (FINCO)ITTEE GANISATIONAL DE V ELOP M MM ENT CO M attended eetings 2/3 3/3 3/3 3/3 ITTEE This committee is responsible for: to the members and meetings attended is contained in the Audit Committee report which can be found on page 55 of this document. - Review monthly and quarterly finance report; Tenure committee - Monitor progress on audit issues; The Tenure Committee has always been part of the Board Committee dealing with - Provide financial advice for the Board. matters related to processing the tenure rights applications of the ITB. In order to fast track the approval of tenure rights applications this Committee has been split The FINCO comprises of 4 members as tabled below. in to two teams.

During the period under review the following meetings were held by this committee This committee is responsible for: and the following Board members were in attendance.

- Decide on behalf of the Board on the granting and refusal of applications for Member Meetings tenure rights; attended - Make recommendations to the Board on land tenure matters. Dr M.S. Mbatha (Chairperson) 7/7 Adv W.E.R. Raubenheimer 7/7 Mr B.L. Shabalala 6/7 Member Meetings Inkosi T.W. Mavundla 5/7 attended 51 Inkosi P.R. Bele 2/7 Hon. Mr Justice S.J. Ngwenya (Chairperson) 9/11 Hon. Mr Justice S.J. Ngwenya 1/7 Ms J.T.J. Bhengu (Deputy Chairperson) 11/11 Adv W.E.R. Raubenheimer 10/11 Audit Committee Mr B.L. Shabalala 8/11 The Audit Committee has always been part of the Board Committees dealing with *Inkosi T.W. Mavundla 9/11 matters related to Audit and Risk within the organisation. It has since been revised Inkosi P.R. Bele 10/11 with the addition of Board members to improve efficiency. *Inkosi S.E. Shabalala 9/11

This committee is responsible for: Dr M.S. Mbatha 8/11 2017 - 18 report | annual Inkosi Z T Gumede 9/11 - Provide leadership in the process of structuring the Secretariat of the Ingonyama Trust Board; Advocate. V.Z. Mngwengwe (Ministerial representative) 0/11

- Providing leadership and policy direction in matters pertaining to Human Resources for the ITB.

The Audit Committee is constituted by 4 members. Further information pertaining ingonyama trust board trust board ingonyama 52 ingonyama trust board | annual report 2017 - 18 During the financial year under review the Board retained Ubuntu Business Advisory and Consulting (PTY) financial the the During InternalBoardyear under reviewthe ConsultingretainedUbuntuLTD perform to and function. Audit Business(PTY) Advisory through evaluation, the improvement and testing of risk financial effective management, controls governanceand processespolicies. and objective ofThe internal the audit is to to provide add an objective value independent and consulting and improve service operations the of Trust. the This is achieved Public requires Finance ManagementThe (PFMA) Act to Board the establish internalan effective control audit the under and direction function of Audit the Committee. Audit Internal approved Board The aRisk Management strategy for financial the year.risk The management plan wasdesigned primarily to preventfraud and and relatedidentify risks. Risk M In for order to Board the with its mandate comply ensures it that asustainable internal control environment is maintained. anagement

internal controlenvironment AUDIT COMMITTEE REPORT

We are pleased to present our report for the year ended 31 March 2018. audit approach. Various recommendations have been made to the Board arising from reviews of its operations and reports from the internal auditors. As a result the Audit committee members and attendance Board has formalised policies this year and is currently considering more of these policies for adoption. The Audit Committee consists of the members listed hereunder. The Committee should meet not less than four times per annum as prescribed in the audit charter. Evaluation of Financial Statements

During the current year four meetings were held. The Audit Committee has:

Member Committee - Reviewed the Auditor - General’s management letter and management’s Meetings response thereto, Mr S Gabela (Chairperson) 4/4 - Reviewed changes in accounting policies and practice, and; Mr M Khuzwayo 2/4 - Reviewed significant adjustments resulting from the audit. Mr B.L. Shabalala 4/4 53 Dr M.S. Mbatha 4/4

Audit Committee’s Responsibility

The Audit Committee reports that it has complied with its responsibilities arising from section 51(1) (a) of the PFMA and Treasury Regulations. Mr S Gabela Chairperson The Audit Committee also report that it has adopted appropriate formal terms of August 2018 reference as its audit committee charter and has discharged its responsibilities in terms of this charter. The Audit Committee has liaised with both internal and external auditors and reviewed their plans and findings to ensure that the internal controls are as effective as possible and appropriate to the organization. 2017 - 18 report | annual

The King III Report on Corporate Governance has been implemented to the extent it is applicable to the organisation and both internal and external auditors have unrestricted access to the Audit Committee.

The financial policies have been reviewed and the Audit Committee is satisfied with the effective functioning of the internal control system. A risk management process

has been undertaken and has been evaluated by the auditors as a basis for their trust board ingonyama 54 54 ingonyama trust board | annual report 2017 - 18 HUMAN RESOURCE MANAGEMENT SECTION d 55 | annual report 2017 - 18 report | annual ingonyama trust board | annual report 2017 - 18 report | annual trust board ingonyama 56 ingonyama trust board | annual report 2017 - 18 trainin personnel Ov E Ingonyama Trust B N/A progra progra progra Ingonyama Trust B M erall PLOY g costs M Em mm mm mm ENT V AND cost ploy e e e m b oard oard ent y ACANCIES progra statistics T mm otal E P ersonnel Em of (per 2017/2018 N 2017/2018 e the for xpenditure m ployees 23 anent E ntity expenditure HUMAN RESOURCESO o ) . . R 81,878,853 2017/2018 A 2017/2018 N/A P osts 27 ppro expenditure E P xpenditure T ersonnel rainin v R 21,969,634 ed

g VERSIGHT STATISTICS

( N/A additional 2017/2018 N P of a% as expenditure exp ersonnel total% of exp P contract ersonnel T to rainin o 27% Em . of 33 esta g b cost ) . A ployees lishm . s a N/A ent N N o o , e . of e . of trained N/A m m 54 ployees ployees Vacancies 2017/2018 2017/2018 3 Avg. trainin cost personnel per per v % of Av em em era ployee ployee acancies 5% R 406,845 g g cost e

N/A Employment statistics per salary band

SALARY BAND 2017/2018 No. 2017/2018 Approved 2017/2018 No. of Employees 2017/2018 % of vacancies of Employees Posts (additional to establishment, Vacancies (permanent) contract) Top Management 0 0 1 0 0% (level 15-16) Senior Management 1 2 0 0 0% (level 13 - 14) Professional qualified 4 6 2 2 25% (level 9 - 12) Skilled 15 16 22 1 3% (level 6 - 8) Semi - skilled 3 3 7 0 0% (level 3 - 5) Unskilled 0 0 0 0 0% (level 1 - 2) 57 TOTAL 23 27 33 3 5% | annual report 2017 - 18 report | annual ingonyama trust board trust board ingonyama 58 ingonyama trust board | annual report 2017 - 18 Em

(level 13(level -14) M Senior 15-16) (level Top M REASON (level 6-8)(level Skilled 9-12)(level Professional qualified SALARY B Total Other (level 1-2)(level Unskilled TOTAL 3-5) (level -skilled Semi Expiry of contract of Expiry Ill health Retirement Dismissal Resignation Death ploy anagement anagement m anagement chan ent AND g es NUMB Employment at beginning of of beginning at Employment 12 0 0 0 0 0 5 7 ER period 63 41 12 0 1 1 8 % OF TOTAL% OF NO. OF STAFF LEA STAFF 22% 13% 0% 0% 0% 0% 0% 9% V IN G Appointments 0 0 0 1 4 1 2 Terminations 12 0 1 1 2 4 4 Employment at the end of the period the of end the at Employment 55 37 10 0 1 1 6 59 | annual report 2017 - 18 report | annual ingonyama trust board trust board ingonyama 60 ingonyama trust board | annual report 2017 - 18 CONSOLIDATED ANNUAL FINANCIAL STATEMENTS SECTION E 61 | annual report 2017 - 18 report | annual ingonyama trust board | annual report 2017 - 18 report | annual trust board ingonyama 62 ingonyama trust board | annual report 2017 - 18 Adv. V.Z Mngwengwe (Ministerial representative) Mbatha M.S Dr Inkosi Shabalala E S. Inkosi Z.T Gumede Inkosi P.R Bele Inkosi T. WMavundla Shabalala B.L. Mr Adv. W.E.R. Raubenheimer Ms J.T.J. chairperson) (vice Bhengu Ngwenya Mr Justice S.J. Hon. (Chairperson -Royal nominee) His (Trustee King the Majesty ) of IngonyamaMembers the Trust as Board at 31 March 2018 : G Board. Board the 26 the on Maymembers 2018 by and signed its behalf on by of chairperson the the approved were 124 to 74 page on out set statements financial The review.year under breakdown in the functioning of these controls, procedures and systems during the Nothingloss. to hascome attention the of to Board the indicate anymaterial and misstatements detect and prevent and assets, the of accountability maintain and verify safeguard, adequately to and statements, financial the of reliability the control. These financial internal of system Trust’s the for responsible also is Board The with accordance in prepared been Standards. Practice Accounting Recognised Generally have statements financial The statements. financial the of presentation fair the on reporting for responsible are auditors The information. related and statements financial the of integrity and preparation the is Board responsible The for maintenance the of adequateaccounting records and Information eneral

r dsge t poie esnbe bt o aslt, suac a to as assurance absolute, not but reasonable, provide to designed are STATEMENT OFBOARD’S FORFINANCIALANDPERFORMANCEINFORATION RESPONSI BILITY

Auditors: Office: Registered Ltd Africa of Bank Standard South Investec Absa Nedbank Bank First National -adivision Bank of FirstRand Ltd Bank Bank Ltd Bankers: Limited Ltd Auditor - General 3201 Pietermaritzburg Trelawney65 Road

3200 Pietermaritzburg P.O. Box 601 Fax: 033 386 2528 386 033 Fax: Tel: 9900 846 033 General information - continued

The Ingonyama Trust Board is a schedule 3A Public Entity. The Executive Authority for the period of this report is the Minister of Rural Development and Land Reform. The area of jurisdiction is KwaZulu-Natal.

The Trust was initially created by the KwaZulu Legislative Assembly as a repository for the communal land of the Zulu Nation with His Majesty the King as sole Trustee. This was by way of the Ingonyama Trust Act 3 of 1994KZ. In 1997 the democratic National Parliament amended this Act,so that it is consistent with modern constitutional order.

This amendment involved changes to all sections of the Act by way of the KwaZulu-Natal Ingonyama Trust Amendment Act No 9 of 1997. Importantly this Act established the Trust Board appointed by the then Minister of Land Affairs following a consultative process with the KZN Premier – in – Executive Council and the Chairperson of the KZN House of Traditional Leaders. The King remains the sole Trustee and he (or his nominee) chairs the Board. The 1997 amendment Act also excluded application of private trust legislation to the Ingonyama Trust. The effect of these amendment among others was to create a Board which is a separate and independent legal entity. The members of the Board are not trustees but are appointed by the Minister responsible for land affairs.

The function of the Board is to administer the affairs of the trust and trust land. This is a unique situation since trusts are ordinarily controlled by boards of trustees.

The Ingonyama Trust owns land in Trust. In practice it is a nominal owner since the land in question belongs to the beneficial clans and the members thereof.

Access to the Trust land is primarily in terms of indigenous law. The preferred tenure option by the Board is the lease which to a greater extent is consistent with customary 63 law approach to land ownership. With the changing times and socio economic development in the country the Board is encouraging every land rights holder on Trust land to acquire formal tenure and in return make some financial contribution towards the sustainability of this land.

Approval of Annual Financial Statements

The Annual Financial Statements for the year ended 31 March 2018 were approved by the Board on 26 May 2018. | annual report 2017 - 18 report | annual

Chairperson of the Ingonyama Trust Board Hon. Mr Justice S J Ngwenya ingonyama trust board trust board ingonyama 64 ingonyama trust board | annual report 2017 - 18 Property plant and equipment B Adverse opinion statements financial separate and consolidated the of audit the on Report 3. 2. 1. asis for adverse opinion adverse for asis the to due billion R1,08 of informationsupporting not submitted. value the to land for accounted properly has management that evidence appropriate sufficient obtain to unable was II (PFMA). 1999)of 1 No. (Act 1999 Africa, South of Act Management Finance Public and requirementsAccounting the (SA of Practice Standards GRAP) of the of Standards African ended GenerallyRecognised South with in the accordance then year the for flows cash its and performance financial its and 2018, March 31 at as Board Ingonyama Trust the of position financial the present fairly, materialnot all respects, statements separatein do financial basis for adverse opinion section the of in described this matters the of auditor’s significance the of report, because the opinion, my In consolidated and statements, of including significant asummary accountingpolicies. financial the to notes the as well as ended, then year the for information flow statement cash and statement of of comparison informationbudget with actual assets, net in changes of statement statement performance, financial the of 2018, March 31 at as position financial of of statement comprise the statements which 124, to 74 financial pages on separate out set Board and Trust Ingonyama the consolidated the audited have I REPORT OFTHEAUDITOR GENERALTO PARLIA MENT ONTHEINGONYAMA TRUSTBOARD Expenditure Expenditure 6. 5. 4. period and on the accumulated and the on period surplus. the for surplus the on impact resultant a was there Additionally, so do to I was Board. unable to determine impact the total on Trust expenditure as was it impracticable Ingonyama the of statements financial separate the in of overstated Presentation was expenditure 1, total Consequently, GRAP Statements. Financial with non-compliance in resulting Board Trust Ingonyama the of statements financial separate the in Trust Ingonyama expenditure recognised relating incorrectly tobasis the and furthermore IngonyamaThe Trust did Board not recognise expenditure a comparable on I acquisition. to so. do impracticable of date the at as value did fair not determine value correct the and of extent land held as was it fair at it recognising by Property, 16,Investment GRAP ofrequirements the with accordance in appreciation did trust notThe recogniseland the held to rental earn for or capital wasit impracticable to so. do as billion R28,21 of equipment shown in note 21 and to the consolidated and separate financial statements, plant as property, the of extent full the determine to able not was I Consequently, properties. the value correctly due to diagrams survey not and submitted inadequate controls in place to was This equipment. and plant 17, Property, in GRAP equipment with and accordance plant property, for account properly not did Trust The Receivables from exchange transactions Other matter

7. I was unable to obtain sufficient appropriate audit evidence that provision for 12. I draw attention to the matter below. My opinion is not modified in respect bad debts for the year under review is properly accounted for, due to the entity of this matter. not providing for all debtors that are long outstanding and did not assess at the end of the reporting period whether there is any objective evidence that all debtors or group of financial assets is impaired in accordance with Unaudited supplementary notes GRAP 104, Financial Instruments. Consequently receivables are overstated and provision for bad debts are understated. I was unable to determine the 13. The supplementary information set out on pages 118 to 125 does not form impact on receivables from exchange transactions and the provision for part of the consolidated and separate financial statements and is presented bad debts as it was impracticable to do so. as additional information. I have not audited these notes and, accordingly, I do not express an opinion thereon.

Royalty revenue Responsibilities of accounting authority for the consolidated and separate financial 8. Royalties received by the trust from the mining operator were incorrectly statements recognised as revenue by the trust, which is contrary with the requirements of GRAP 9 Revenue from exchange transactions. Consequently, royalty 14. The accounting authority is responsible for the preparation and fair revenue was overstated by R794 157 (2017: R922 424) and the payables presentation of the consolidated and separate financial statements in were understated by the same amounts. 65 accordance with SA Standards of GRAP and the requirements of the PFMA, and for such internal control as the accounting authority determines is necessary to enable the preparation of financial statements that are free Context for the opinion from material misstatement, whether due to fraud or error.

9. I conducted my audit in accordance with the International Standards on 15. In preparing the consolidated and separate financial statements, the Auditing (ISAs). My responsibilities under those standards are further accounting authority is responsible for assessing the Ingonyama Trust described in the auditor-general’s responsibilities for the audit of the Board’s ability to continue as a going concern, disclosing, as applicable, financial statements section of this auditor’s report. matters relating to going concern and using the going concern basis of accounting unless the accounting authority either intends to liquidate the

10. I am independent of the entity in accordance with the International entity or to cease operations, or has no realistic alternative but to do so. 2017 - 18 report | annual Ethics Standards Board for Accountants’ Code of ethics for professional accountants (IESBA code) and the ethical requirements that are relevant to my audit in South Africa. I have fulfilled my other ethical responsibilities in accordance with these requirements and the IESBA code.

11. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my adverse opinion. ingonyama trust board trust board ingonyama 66 ingonyama trust board | annual report 2017 - 18 Introduction and scope report performance annual the of audit the on Report statements financial separate and consolidated of the audit the for responsibilities Auditor-general’s 19. 18. 17. 16. Accordingly, my findingsnotdo extend these to matters. information. performance ofthat may reported the as included be part strategies and informationplanned performance in of respect future periods procedures also did not to extend any disclosures relating assertions or to indicatorsof in included planning the performance the My documents. entity.the which I have not evaluated completeness the and appropriateness information, performance reported planning mustapproved based the be on of documents performance the address procedures My express to evidence gather to not assurance. but findings identify to procedures Iperformed objectives presented report. in annual the performance programmes/ selected for objectives performance predetermined against reported information the on findings material report to have responsibility I thereof, a terms in No. issued notice (Act general the 2004 and Africa, (PAA) 2004) South of of25 Act Audit Public the with accordance In this to annexure the in included auditor’s report. is statements financial separate and description of myresponsibilities A further for auditthe of consolidated the consolidated and separate financial statements. decisions ofto economic users taken the influence basis the on of these expected be reasonably could they aggregate, in or individuallyif, material exists.it Misstatements arise can and from fraud are error or considered will ISAs with the alwaysaccordance detect amaterial misstatement when in conducted audit an that guarantee a not is but assurance, of an level high issue to and error, or that includesmy auditor’sopinion. Reasonablereport assurance is a fraud to due whether misstatement, material from free are whole a as statements financial separate and consolidated objectives areMy to obtain reasonable assurance the whether about 23. 22. 21. 20. scorecard forscorecard development commercial Indicator2.6 -Monitoring and compliance adherence to BBBEE ITB defined. clearly of method calculationThe for achieving planned the indicator was not with private and partnership implemented sector identified Indicator of -Number 2.4 potential projects of high commercial value for Programme 2–Real estate the of reliability and usefulness programmeselected the are as follows: of respect in findings material The complete. and accurate valid, was it whether determine to information performance reported the of reliability the assessed and relevant, and measurable were procedures to determine indicators the whether further and related targets consistent planning with approved the I performed documents. performance information was was presented properly and performance whether performance procedures to determine reported the whether I performed Programme 2–Real estate P for of 31 year the entity the ended March 2018:report followingthe programme selected presented in annual the performance management asand framework, reporting defined inthe general notice, for information performance fromin with criteria the the developed accordance I evaluated usefulness the and reliability performance of reported the rogramme 39 – 42 – 39 report P ages in the annual performance performance annual the in ages 24. I was unable to obtain sufficient appropriate audit evidence to support Report on the audit of compliance with legislation the reported achievement of indicator 2.6 - monitoring compliance and adherence to ITB BBBEE scorecard for commercial development. This was Introduction and scope due to a lack of technical indicator descriptions and proper performance management systems and processes and formal standard operating 28. In accordance with the PAA and the general notice issued in terms thereof, procedures or documented systems descriptions that predetermined I have a responsibility to report material findings on the compliance of the how the achievement would be measured, monitored and reported. We entity with specific matters in key legislation. I performed procedures to were unable to confirm the reported achievement of the indicator by identify findings but not to gather evidence to express assurance. alternative means. Consequently, we were unable to determine whether any adjustments were required to the achievement of one as reported in the annual performance report. 29. The material findings on compliance with specific matters in key legislation are as follows:

Other matter Annual financial statements

25. I draw attention to the matter below. 30. The consolidated and separate financial statements submitted for auditing Achievement of planned targets were not prepared in accordance with the prescribed financial reporting framework and supported by full and proper records, as required by section 55(1)(a) and (b) of the PFMA. Material misstatements of non-current 67 26. The annual performance report on pages … to … contains information on assets identified by the auditors in the submitted financial statements the achievement of planned targets for the year and explanations provided were corrected, but the remaining uncorrected material misstatements of for the under achievement of a number of targets. This information should non-current assets, current assets, revenue and expenditure resulted in the be considered in the context of the material findings on the usefulness and consolidated financial statements receiving an adverse opinion. reliability of the reported performance information in paragraphs x to x of this report. Revenue management

Adjustment of material misstatements 31. The entity did not pay the royalty revenue to the national revenue fund as required by section 2 of the Mineral and Petroleum Resources Royalty Act,

27. I identified material misstatements in the annual performance report 2008 (Act No.28 of 2008)(MPRRA). 2017 - 18 report | annual submitted for auditing. These material misstatements were on the reported performance information of Programme 2 - Real estate. I raised material findings on the usefulness and reliability of the reported performance 32. Effective and appropriate steps were not taken to collect all revenue due, as information. As management subsequently corrected only some of the required by section 51(1)(b)(i) of the PFMA. misstatements, those that were not corrected are reported above.

. trust board ingonyama 68 ingonyama trust board | annual report 2017 - 18 Internal control deficiencies Other information 37. 36. 35. 34. 33. express any form of assurance it. on and to not was information objective my however, legislation; performance applicable with compliance reported statements, financial separate I considered internal control relevant to my audit of consolidated the and this isit corrected will not necessary. be auditor’sasanand amended re-issue report report appropriate. However, if corrected. If the other information is not corrected, I may have to retract this to chargedthose with governance and request that other the information be matter the communicate to required am I misstatement, material a is After I receivereport. and read this information, and if I conclude that there I did not other receive the information to prior date the of this auditor’s misstated. materially be to appears otherwise or audit, the in obtained knowledge my or report, materially programmes/objectivesperformance annual selected the presented isthe in information other and statements the financial separate and consolidated whether the with inconsistent consider so, doing in and, In connection with my audit, my responsibility is to read the other information opinion any or form of assurance conclusion thereon. with compliance legislation not do and cover other the information and not I do express an audit information performance and reported statements the financial on separate findings and consolidated the on opinion My auditor’s report. this in reported specifically been have that report performance annual the inpresented programme selected the and report auditor’s the statements, consolidatedseparate andfinancialthe include not information otherdoes information information the The comprises in included annual the report. is responsible accounting authority forThe otherthe information. other The Other reports Financial and performance management Leadership 41. 40. 39. 38. reported performance information or compliance with legislation. with information compliance or performance reported the on findings my or statements financial the on opinion my of part form applicable legislation and not other does related matters. This report with compliance information, performance reported statements, financial entity’s the in reported matters the on impact an have, could or had, that I draw attention to following the conducted engagement by various parties information. performance Nationalthe Treasury’s framework for managing the of programme established wasby inadequate accounting the authority system to monitor with compliance The framework. reporting financial applicable the of were prepared recordsrequirements with inand the reports accordance Management did not ensure that accurate and complete expenditure regulations.and laws with compliance and processes reporting performance and financial leadership didThe not establish oversight effective and monitoring over inincluded this report. legislation with compliance on findings the and report performance the on findings the opinion, adverse the for basis the in resulted that deficiencies control internal significant the to limited are below reported matters The 42. An investigation is being conducted by the accounting authority, which covers the period 1 April 2017 to 31 March 2018. The investigation was initiated based on an allegation of possible misappropriation of the trust’s assets. Six officials have been charged by the accounting authority with financial misconduct and a disciplinary case is in progress. The outcome of the investigation is expected in the 2018-19 financial year.

Pietermaritzburg 10 August 2018

69 | annual report 2017 - 18 report | annual ingonyama trust board trust board ingonyama 70 ingonyama trust board | annual report 2017 - 18 1. B follow adopted and audit the by methodology AG the in finalisingtheir report. aboveThe background is to critical of understanding sequence events the that information. this in however,case was it not practical in time the stipulated size, to provide all of requested the sample reasonable a for normally requested information audit ofIt is practice common AG the that to two days three are given to provide audit the finalising reports. of process the in were they that stated they as information AG by responded then The granting additional no time to submit required the to AG. the Thursday,bydiagrams were furnished 2018. July survey 26 2018, 24July By 488 requested that ITB additionalThe given time be to submit all of information the half days, i.e. by midday 24th July 2018. diagrams survey and 19660 providedbe in aspace of title deeds to two and two As evidence to verify ownership and existence of Trust land, the AG requested that register. would One have asample to expected for selected be audit purposes. to audit AG 100 undertook The %of land the values in reflected land the valuations value of billion R28 based municipal on was valuations. in reflected AFS, the 2017/2018 in time first however,the years;for a Trustprior Ingonyamafor the of statements financial the in value land a disclose and determine not did ITB The Auditorthe (AG). General We believe that this matter is akey issue which gave rise to adverse the opinion by asis of the adverse opinion -Land valuation -Land opinion adverse the of asis RESPONSE OFTHEINGONYAMA TRUST BOARD TO ASPECTS OFTHEAUDITOR GENERAL’S REPORT between the Ingonyama Trust and the Ingonyama Trust B Ingonyama Trust the and Ingonyama the between allocation –(Expenditure expenditure of recognition -Incorrect Expenditure 2. Responsibility for trust money and Property : follows as reads Trustis and money regulated in termsof Property Treasury regulation 14which administration of Trust affairs and Trust land in termsof Ingonyama the Trust Act. IngonyamaThe Trustadministrative being the Board isarm responsible for the the entities. has Board adifferentThe to view AG the expenditure the on allocation between was finalised only audit report opinion. The the by on AG 14 August 2018. would ITB haveThe provided required the informationadverse and the averted submission of opinion. legal the submission diagrams of survey the of as and copies was title deeds case the for In all fairness more time should have given by to been AG the ITB the regarding the to provided be within 2days. 11 No formalrequest, regardingopinionsubmissionwas legal received the of the 2018 August 2018. 6th a July On 31 by reports audit their finalise not did AG The provided issue the on of entities two the and withheld final the audit reports. AG atThe 31 on 4.26 pm July 2018 requested by email that a opinionlegal be - details the specificpurposes it mayfor which used. detailsbe the specificpurposes other persons or entities in terms of a deed of trust or equivalent instrument that of behalf institution on an by held is that State and the to belong not does that property or money is property or money trust regulation, this of purposes For oard ) oard It is clear from the above that Trust money is to be utilised for the benefit of The Board has revised the organogram/secretariat structure and took into account communities which is the mandate of the Ingonyama Trust. the need of providing resources to undertake debt collection.

In terms of Section 4 of the Ingonyama Trust Act, the Department of Rural The revision of the credit control policy is a task scheduled to be undertaken in the Development is responsible to bear the administrative cost of the administration of 2018/2019 operation plan. the Board. Therefore, mainly administrative costs are allocated to the Ingonyama Trust Board including salary cost. The above actions will ensure the reduction of debt and an adequate policy in place on the provision of doubtful debts. The Board sees itself as the employer, employing staff to administer the affairs of the Trust and therefore employee costs to be recognised solely in the books of the 4. Royalty Income – entitlement Ingonyama Trust Board. Due to the Mineral and Petroleum Resources Royalty Act coming into effect on 1 The Board notes that Trust generated funds are to be retained for community May 2009, the Ingonyama Trust has lost a significant portion of income generated beneficiaries after the payment of Trust expenditure. from Trust land (at least R 20 m annually) to the state in the form of royalties.

Trust expenditure mainly relates to non- administrative/operational expenditure These royalties accrue to beneficiary communities living on Trust land which described under Programme 2 – Land and Tenure Management that has a direct make up a large portion of indigent persons living in Kwazulu-Natal. bearing on the issues of land management, tenure rights, land developmental initiatives and safeguarding of land assets. 71 Since 2009, there is no traceable record that indicates of any community living on Ingonyama Trust land having received direct benefit from the royalties paid to the The Board highlights that all expenditure disclosed in both entities have state. been subjected to audit and prides itself that there have been no instances of mismanagement of funds either by way of irregular or fruitless and wasteful The Ingonyama Trust which was created by an Act of Parliament for the benefit expenditure. of these communities is of the view that the royalties collected were contractual in nature, which are permissible in law (section11 (1) of schedule 11 of the Mineral The expenditure disclosed in the financial statements of the respective entities and Petroleum Resources Development Act No 28. of 2002 ) to be retained by the has been disclosed to the Executive authority and to the oversight parliamentary land owner. committee on a quarterly basis and during the budgetary processes in compliance with Paragraph 9 (a) and (b) of GRAP 1 accounting standard. For this reason, during the course of this financial year, the Board approached the 2017 - 18 report | annual Department of Mineral Resources to state its view that contractual royalties paid 3. Receivables from Exchange transactions - Provision for doubtful debts not to the Trust within Ingonyama Trust land in terms of the said act belong to the adequately provided for Ingonyama Trust.

The provision for doubtful debt was increased to 35 % of the total debt as a result of the query raised during the course of the audit. ingonyama trust board trust board ingonyama 72 ingonyama trust board | annual report 2017 - 18 Responsibility for Trust Money and Property follows: as reads which 14, regulation Treasury National of terms in that emphasises further Board The Ingonyama of extent huge Trust land that is mined by alarge of number mining operators. the also of inputs Amakhosi, the including required stakeholders it as various 2018 March 31 by finalised be not could plan This development of and social upliftment communities. economic local approval by National Treasury detailing how funds are to for used be of purposes for plan year five a prepare to Department the by requested then was Board The We are of the view that should it be necessary, we request that this matter be be matter this that requestreferred to amediator/arbitratorwe for resolution. necessary, be it should that view the of are We rentals to prevailing the market rental. negotiations areFurther being held with mining operators to increase surface the state. to the operators mining has Board not The in any of instance royalties promoted non-payment the by exclude not does which Trust, the by retained contractual royalties in held Trust. be to are Trust in held Funds - - property, in accordance with the relevant deed of trust or equivalent instrument. equivalent or trust of deed relevant the with and accordance money in trust property, of use proper and safekeeping the for responsible is agent, authorised a duly or officer financial chief the through officer, accounting The purposes it maydetailsfor which used. be the specific other persons or entities in terms of a deed of trust or equivalent instrument that of behalf institution on an by held is that State and the to belong not does that property or money is property or money trust regulation, this of purposes For 73 | annual report 2017 - 18 report | annual ingonyama trust board trust board ingonyama 74 ingonyama trust board | annual report 2017 - 18 Heritage Assets PlantProperty, and Equipment Assets -current Non Assets Cash and cash equivalents Current assets Current Intangible Assets Total net assets Accumulated Fund ASSETS NET -exchange fromReceivables non transactions Payables exchange transactions from liabilities Current Liabilities Total Assets exchange transactions from Receivables Net assets Total liabilities Payables -exchange from non transactions STATEMENT POSITIONCH 2018 CIAL FORTHEYEARENDED31MAR OFINAN Notes 3 &21.1 3 &22 4 &23 25.2 25.1 27.2 27.1 26 Trust B Ingonyama (18,268,797) (18,268,797) (394,072) 588,809 588,809 155,042 588,809 194,737 130,174 oard 39,695 20,371 16,875 19,324 7,993 - - 28,228,768,495 28,902,401,575 28,884,191,555 28,884,191,555 28,211,883,951 28,884,191,555 673,633,080 205,442,621 467,937,545 18,210,020 18,210,020 Total 2018 18,210,020 15,988,144 896,400 252,914 - Trust B Ingonyama (2,921,077) (2,921,077) 986,363 983,898 670,480 670,480 315,883 670,480 981,223 oard 2,465 2,465 2,675 - - - - 28,846,305,883 28,224,235,944 28,824,556,939 28,824,556,939 28,208,014,898 28,824,556,939 622,069,939 198,870,349 423,199,590 21,748,944 21,748,944 Total 2017 15,988,144 17,754,496 3,994,448 232,902 - STATEMENT OF FINANCIAL PERFORMANCE FOR THE YEAR ENDED 31 MARCH 2018

2018 2017 Ingonyama Total Ingonyama Total Trust Board Trust Board

Revenue Notes Rental revenue - 92,780,201 - 109,088,487

Leases (includes straight lining income) 11 & 35 - 92,780,201 - 109,088,487

Royalty Revenue 6.2.2 - 794,157 - 922,424

Other revenue 19,881,531 36,135,617 18,879,105 36,608,931

Transfer payment - Department of Rural Development and Land Reform 7 19,727,000 19,727,000 18,788,000 18,788,000 Profit on disposal of assets - - - 320,472 75 Servitude compensation - 410,498 - 1,772,637 Interest on Bank and Short term investments 6.3.1 154,531 15,247,425 91,105 14,736,946 Interest on overdue debtors accounts - 750,694 - 990,876

Total Revenue 19,881,531 129,709,975 18,879,105 146,619,842

Expenditure 42 (35,276,539) (66,491,438) (21,800,182) (47,832,113)

Trust Fund - Administration - (31,214,899) - (26,031,931) 2017 - 18 report | annual Expenses funded from Transfer Payment funding (35,276,539) (35,276,539) (21,800,182) (21,800,182)

Available funds transferred to Accumulated Fund (15,395,008) 63,218,537 (2,921,077) 98,787,729 ingonyama trust board trust board ingonyama 76 ingonyama trust board | annual report 2017 - 18 Retained earnings 2016/2017Retained earnings Retained earnings for previously 2016/2017 reported Balance : 31.03.2018 Current year retained earnings trasnferred to Accumulated Fund Change in estimate of to due useful re-assessment life of assets Less :Payments M : balance 01.04.2017Opening Adjustment prior to 2016/2017 prior Adjustment : balance 01.04.2016Opening ovements for the year 2017/2018 year the for ovements STATEMENT OFCH Increase in lease for income 2016/2017 Proceeds on disposal on ofProceeds land Less payments Net gains from value of Property (land holdings) (land gainsNet from value of Property Increase in straight lining income lining straight in Increase Increase in straight lining income lining straight in Increase Increase to in lease prior 2015/2016 income CH 2018 FORTHEYEARENDED31MAR ASSETS ANGES INNET Notes 28.2 28.2 28.1 Trust B Ingonyama Retained (18,268,797) earnings (15,347,720) (15,395,008) (2,921,077) (2,921,077) (2,921,077) R oard 47,288 ------28,824,556,939 28,178,705,496 28,884,91,555 28,177,273,170 553,023,987 92,827,456 59,634,616 (6,370,918) Total 96,529,059 (7,268,301) 63,218,537 (3,701,603) 1,308,028 2,786,997 R 1,113,845 2,188,152 318,481 70,518 CASH FLOW STATEMENT FOR THE YEAR ENDED 31 MARCH 2018

2018 2017 Ingonyama Total Ingonyama Total Trust Board Trust Board

Notes Cash flows from operating activities

Receipts 35,268,946 88,994,808 21,800,182 60,627,229

Services - 40,249,036 - 25,811,512 Transfer payments 19,727,000 19,727,000 18,788,000 18,788,000 Ingonyama Trust funding 15,387,415 15,387,415 2,921,077 2,921,077 Interest Received 154,531 13,631,357 91,105 13,106,640

Payments (36,242,176) (77,520,545) (21,095,153) (53,539,618)

Suppliers (14,168,419) (55,446,788) (9,008,419) (32,349,784) 77 Loss on unauthorised use of petrol cards (59,933) (59,933) - - Employee costs (22,013,824) (22,013,824) (12,086,734) (21,189,834)

Net cash flows from operating activities 39. (A) (973,230) 11,474,263 705,029 7,087,611

Cash flows from investing activities

Purchase of plant and equipment including construction costs 39. (B) - (4,979,122) - (639,249) | annual report 2017 - 18 report | annual Proceeds/insurance claim from disposal of property, plant & equipment - 77,131 - 978,076

Net cash flows from investing activities - (4,901,991) - 338,827

Increase in cash and cash equivalents (973,230) 6,572,272 705,029 7,426,438 Cash and cash equivalents at beginning of the year 981,223 198,870,349 276,194 191,443,911 ingonyama trust board trust board ingonyama

Cash and cash equivalents at end of year 39. (C) 7,993 205,442,621 981,223 198,870,349 78 ingonyama trust board | annual report 2017 - 18 SUMMAR 1.1 B NOTES STATEMENTS TOCIAL THEFINAN CH 2018 FORTHEYEARENDED31MAR asis of Preparation and consolidation and Preparation of asis Responsibility for trust money and Property as reads which 14 regulation Treasury follows and :- Kz 1994 of 3 Act Act, Trust Accounting and Board in Standards a manner required by Ingonyama the the by issued directives interpretationsand anyincluding (GRAP), Practice Accounting of Recognised Standards Generally effective with accordance consolidatedThe AnnualFinancial Statementshave prepared in been Ingonyama Trust is for same the Ingonyama the Trust Board. is Ingonyama controlled the entity The Trust. date reporting of The the and Trust land in terms of of section Ingonyama the Trust Act. IngonyamaThe Trust administers Board affairsthe of Ingonyama the Trust as 1997 Act, Trust Ingonyama the ,namely,amended by Ingonyama Trust and Ingonyama Trust created Board. been have entities Two - - - Y OFSIGNIFICANT ACCO UNTING POLICIEs relevant revenue fund. revenue relevant to the accruing revenue are and account trust the from payable are fees Such trustee. the with agreed as or, its absence, of in trustees board by the rates at approved account of a trust administration the for a fee may charge agent, authorised its duly or institution, The instrument equivalent or of trust deed relevant the with accordance in property, and money trust duly a or officer of use proper and safekeeping the for financial responsible is agent, authorised chief the through officer, accounting The for purposes used. specific may be it which the details that instrument equivalent or trust of of adeed terms in entities or persons of other behalf on institution by an held is that State to and the belong not does that property or money is property or money trust regulation, of this For purposes . comparability and policy accounting in 1.2. Changes 1.3. The Accounting Authority changesan accounting policy if only change: the Accounting Authority The indicated below: Accounting Policies have been consistently applied, except where otherwise and subsequentlydelisted bygovernment gazette 1261 dated 17 2003. April KwazuluThe Ingonyama Trust was listed by government same the gazette 2001,February 2001. 1April effective IngonyamaThe Trust wasBoard listed of by 16Government Notice402 evc hs en edrd Te conig uhrt i stsid that satisfied is Authority Accounting ofrecognition revenue the in current the year The is appropriate. rendered. been has the whether service rendered, are services when and goods the of ownership of goods are sold, had transferred to the buyer the significantrisks when Trust, andIngonyama rewards the whether particular,Transactions: In Exchange criteria for of 9: Revenue recognition the revenue from as in setGRAP out In making their judgment, the Accounting considered Authority the detailed whichconditions under revenue will by Board. recorded the be Accounting Policy on 6.2 1.3.1 Recognition Revenue Statements: Financial Annual in recognised amounts the on effect significant most the involving of those process the from in applying Ingonyama the made Trust Boards’ Accounting Policies and that have apart has Authority judgments, Accounting the critical that estimations, the are following The assumptions estimations and judgments, 1.3 Critical assumptions and estimations judgments, Critical b) a) eut i te iaca saeet poiig eibe n more and cash or flow. performance the conditions on reliable providing statements financial relevant information about the effects of transactions, other events or the in results or is required by of aStandard GRAP; Revenue from Exchange Transactions describes the NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2018

1.3.2 Financial assets and liabilities 1.6 Presentation of Budget information in Financial Statements The budget and the financial statements is prepared and approved on the The classification of financial assets and liabilities into categories is based accrual basis. The approved budget covers the fiscal period from on judgments by the Accounting Authority. 01 April 2017 to 31 March 2018 and is for the Ingonyama Trust Board and the Ingonyama Trust. 1.3.3 Impairment of Financial Assets The presentation of budget information will be on comparisons of budget Accounting Policy 8.2.2 on Impairment of Financial Assets describes the and actual amounts will be presented in a separate financial statement process followed to determine the value by which financial assets should “statement of comparison of budget and actual amounts” included in the be impaired. In making the estimation of the impairment, the Accounting complete set of financial statements as specified in the Standard of GRAP Authority considered the detailed criteria of impairment of financial on Presentation of Financial Statements (GRAP 1). assets as set out in GRAP 104: Financial Instruments - Recognition and Measurement. The Accounting Authority is satisfied that the impairment 1.7 Commitments of financial assets recorded during the year, is appropriate. Capital and operational commitments 1.3.4 Useful lives of Property, Plant and Equipment (“PPE”) The capital commitments at year end relate to contracts where the service was not rendered and relates to the outstanding value of the contract at As described in Accounting Policies on depreciation, the Trust depreciates/ year end. amortises its property, plant and equipment and intangible assets over the estimated useful lives of the assets, taking into account the residual values 79 of the assets at the end of their useful lives, which is determined when 2. Presentation Currency the assets are available for use. The useful lives and residual values of the The Annual financial statements are presented in South African Rand, assets are based on industry knowledge. rounded off to the nearest rand which is the Trust’s functional currency.

1.3.5 Impairment: Write down of PPE and Inventories 3. Property, Plant and Equipment and Heritage assets Significant estimates and judgments are made relating to PPE impairment tests and write down of inventories to net realisable values. 3.1. Property, Plant and Equipment 3.1.1 Initial Recognition

1.4 Going concern assumption 2017 - 18 report | annual Property, plant and equipment are tangible non-current assets that are held The Annual Financial Statements have been prepared on a going concern for use for administrative purposes, and are expected to be used during basis. more than one year including a finance leased asset. The cost of an item of property, plant and equipment is recognised as an 1.5 Offsetting asset if, and only if it is probable that future economic benefits or service potential associated with the item will flow to the Trust, and if the cost or fair Assets, liabilities, revenues and expenses have not been offset, except when value of the item can be measured reliably. offsetting is required or permitted by a Standard of GRAP. ingonyama trust board trust board ingonyama 80 ingonyama trust board | annual report 2017 - 18 NOTES STATEMENTS TOCIAL THEFINAN CH 2018 FORTHEYEARENDED31MAR to model. cost the according equipmentIngonyama Trustandplant The Property, recognises less assets), unrecognised cost accumulated depreciation and accumulated previously impairment losses. at for measured cost are deemed includes equipment, (which and plant property all Subsequently asset.the when it increases the or capacity future benefits associatedeconomic with measured. Subsequent expenditure an on asset incurred is capitalised only fair or andcost the value of subsequent the expenditure reliably be can is equipment associateddelivery subsequent with the expenditure will to flow entity the and plant property, capitalised if it to is probable that future economic benefits relatingor potential service expenditure Subsequent 3.1.2 Subsequent Measurement amount of asset the given up. could not be measured at its fair value, its cost is measured at the carrying assets is measured at its fair value.and If non-monetary acquired the item for assets non-monetary or monetary assets, or a combination of monetary plantequipmentofacquired itemandexchangeof anin cost property, The equal to fair the value of that asset date the on acquired. be to deemed is cost the transaction), non-exchange a (i.e. consideration anWhere asset is acquired by Ingonyama the Trust for nominal or no components) of plant property, and equipment. haveareaccounteddifferentforseparateusefulas lives,they items(major equipment and plant property, of item an of components significant When and dismantling of removing asset the and restoring site the which is on it located. costs necessary the includes also applicable, where cost, The cost. the Tradeat arriving in rebates deducted discountsandare Authority.Accounting for to it capable of be operatingnecessary in manner the intended by the toand other costsattributable asset bring the to and condition location the purchaseprice the is equipment andplant property, ofitem an of cost The its on donation, or grant cost by fair being the value cost, acquired of assetdeemed the initial on at recognition. assets of recognised case the initially in or are date acquisition equipment and plant Property, appropriate. depreciation chargeis The componentisation based the on approach where equipment is capitalised measure based the on of work completed. majoron improvements Expenditure and additionsto tangibleplant and values as follows: straightline basis over theiruseful lives intoafter taking accountresidual of cost The each asset is depreciated to its estimated residual value the on into account residual values, impairment of assets and depreciation. Plant and Equipment arestated at historical and cost adjusted after taking stated otherwise. unless use, for available is asset the when commences only Depreciation rates following are the based on estimated useful lives. that have different useful lives are depreciated separately. depreciation The Components of assets that are significant in relation tothe whole asset and potential or service are expected consumed be to benefits the by Trust. in pattern the which asset’s the reflects used future economic method values over estimated the useful lives of depreciation assets. the The on cost, using the straight line method, to allocate their cost to their residual having an indefinite life.Depreciation on assets otherthan land iscalculated owned byLand Ingonyama the Trust isnot depreciated as isit regarded as 3.1.3 Depreciation equipment A offices home Park Furniture & equipment equipment Computer M Buildings gricultural machinery and gricultural machinery otor vehicles - 6years - 15 years - 12 years - 12 years - 5years - 25 years NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2018

Where the assets are the same, or the cost component is not significant as An impairment loss is recognised for cash-generating units if the recoverable a proportion of total cost, assets are not componentisised. Building used service amount of the unit is less than the carrying amount of the unit. The for office accommodation has been depreciated from date of beneficial impairment loss is allocated to reduce the carrying amount of the assets of occupation and use. the unit as follows: 3.1.4 De-recognition of property, plant and equipment - to the assets of the unit, pro- rata on the basis of the carrying amount The carrying amount of an item of property, plant and equipment is de- of each asset in the unit. recognised on disposal, or when no future economic benefits or service The Accounting Authority assesses at each reporting date whether there potential are expected from its use or disposal. is any indication that an impairment loss recognised in prior periods for assets may no longer exist or may have decreased. If any such indication The gain or loss arising from the de-recognition of an item of property, exists, the recoverable service amounts of those assets are estimated. plant and equipment is included in surplus or deficit when the item is de- recognised. Gains are not included in revenue. The increased carrying amount of an asset attributable to a reversal of an impairment loss does not exceed the carrying amount that would have 3.1.5 Impairment of Non-Cash generating assets been determined had no impairment loss been recognised for the asset in prior periods. The Accounting Authority assesses at each reporting date whether there is any indication that an asset may be impaired. If any such indication exists, A reversal of an impairment loss of assets carried at cost less accumulated the Trust estimates the recoverable service amount of the asset. depreciation or amortisation is recognised immediately in surplus or deficit. 81

If there is any indication that an asset may be impaired, the recoverable 3.2 Heritage assets service amount is estimated for the individual asset. If it is not possible 3.2.1 Initial Recognition to estimate the recoverable service amount of the individual asset, the recoverable service amount of the cash-generating unit to which the asset Heritage assets are assets that have a cultural, environmental, historical, belongs is determined. natural, scientific, technological or artistic significance and are held

indefinitely for the benefit of present and future generations. Heritage assets The recoverable service amount of an asset or a cash-generating unit is the are recognised at cost by the Ingonyama Trust and will be accounted for in higher of its fair value less costs to sell and its value in use. terms of GRAP 103.

If the recoverable service amount of an asset is less than its carrying 2017 - 18 report | annual 3.2.2 Depreciation amount, the carrying amount of the asset is reduced to its recoverable service amount. That reduction is an impairment loss. Heritage assets are held indefinitely for the benefit of present and future generations and are not depreciated. An impairment loss of assets carried at cost less any accumulated depreciation or amortisation is recognised immediately in surplus or deficit. 3.2.3 De-recognition The carrying amount of a heritage asset shall be de-recognised: a) on disposal, or ingonyama trust board trust board ingonyama 82 ingonyama trust board | annual report 2017 - 18 4.1 Initial Recognition Assets 4. Intangible NOTES STATEMENTS TOCIAL THEFINAN CH 2018 FORTHEYEARENDED31MAR item’s fair value was not determinable, it’s deemed cost is the carrying carrying the is cost amount of asset(s) the deemed given up. it’s determinable, not was value fair item’s assetthe acquired is initially measured at fair value (the cost). If acquired the assets, and non-monetary assets, a combination or of monetary monetary an intangible asset or asset isacquired in exchange fora non-monetary Where acquired. is it date the at as value fair its is cost its consideration, anWhere intangible asset is acquired at for or cost no a nominal and accumulatedamortisation impairment losses. separately internally or at generated less accumulated cost are reported Intangible assets are initially Intangible at recognised cost. assets acquired are tested for impairment annually, 31. with in GRAP accordance line basis over its useful life, not exceeding three years. Development assets point fromthe at which asset the isamortised ready for use astraight- on Capitalised developmentperiod. costsare as intangible recorded assets and asrecognised an are expense not as recognised an asset in asubsequent asrecognised an as expense costspreviously Development incurred. development expendituresthat criteriaOther these are not do meet incurred. when expense criteria before are they capitlised. Research expenditure is as recognised an Internallygenerated intangible assetsare subject to recognition strict reliably. measured toflow Ingonyama the Trust fair or and cost the value of asset the be can potential or service benefits that economic are attributable tothe asset will of Financial Position is it when only probable that future expected the Ingonyamaassets. The Trust recognises an intangible asset in its Statement intangible others, as recognised to and classified rental are for purposes administrative for or services, of supply or production the in use for held are which substance physical without assets non–monetary Identifiable b) from its use disposal. or expected are potential service or benefits economic future no when 5. 5. 4.3 De-recognition 4.2 M Subsequent Property (land holdings) - other than office accommodation at 65 at accommodation office than other - Trelawney Road holdings) (land Property financial statements basedon the average municipal land valueper hectare. fairThe value of Ingonyama the Trust disclosed has in the been Property Ingonyamathe Trust Act. it was not acquired at a price, but vested in the Ingonyama Trust in terms of has disclosed not in Financial the been Statements as of cost The Property asrecognised assets of Trust. the holdings) (land registeredProperty in name the of Ingonyama the Trust are Performance. Financial value and is in recognised Statement of the and carrying the proceeds of an intangible asset sales the is determined as between difference the usethe of gain asset. loss the arising or The disposal the on retirement or from expected potential service or benefits economic further no are there asset the when Intangible is disposed of when assets or are de-recognised a change in accounting estimate in Statement of the Financial Performance. Any adjustments arising annual from the review are applied prospectively as estimatedThe useful life are method reviewed and annually. amortisation recoverable amount. revaluation. a previous amount and the carrying the impairment lossThe is between difference the reverses impairment the where loss, except identified impairment the by adjusted is which is that as recognised impairment the an in expense period is the value carrying the impaired, been assetsnot yet availablefor use. items Where of intangible assetshave intangible including impairment, for tested annually are assets Intangible not are assets intangible such amortised. life, useful indefinite an have to deemed to and computer software website design. intangible Where assets are useful lives, which does not exceed twelve years including but not restricted isstraight-line a charged on basis Amortisation over intangible the assets’ easurement, Amortisation and Impairment Amortisation easurement,

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2018

6. Revenue Recognition The straight lining of leases has increased the reported revenue for lease income. 6.1 General The difference between the straight lining and normal charge has been Revenue comprises the fair value of the consideration received or receivable disclosed in note 33. for the sale of goods and services in the ordinary course of the Ingonyama

Trust’s activities. Revenue is shown net of value-added tax, returns, rebates The Ingonyama Trust has not entered into any new finance lease and discounts. agreements. The Ingonyama Trust recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will 6.2.2 Royalty Revenue flow to the Ingonyama Trust and when specific criteria have been met for each of the Trust’s activities as described below. The amount of revenue is The Ingonyama Trust leases its land to mining and prospecting operators. not considered to be reliably measurable until all contingencies relating to the sale have been resolved. The Ingonyama Trust bases its estimates on Royalty revenue is recognised as income of the Ingonyama Trust. historical results, taking into consideration the type of customer, the type of transaction and the specifics of each arrangement. 6.2.3 Other income Revenue from exchange transactions refers to revenue that accrued to the This refers to all other income not classified above including servitude Trust directly in return for services rendered / goods sold, the value of which compensation and interest income. approximates the consideration received or receivable. 83

Revenue from non-exchange transactions refers to transactions where 6.3 Revenue from Non-Exchange transactions the Ingonyama Trust received revenue from another entity without directly 6.3.1 Finance Income giving approximately equal value in exchange. Interest is earned from funds invested with banks over a short term at fixed Revenue from non-exchange transactions is generally recognised to the interest rates and on current accounts. extent that the related receipt or receivable qualifies for recognition as an asset and there is no liability to repay the amount. Revenue from Exchange Interest on investments is recognised on the accrual basis and capitalised transactions comprises of Leases, Royalties, and Other income/(servitude to investments on maturity on the time proportionate basis that takes into compensation). account the effective yield on the investment. 6.2. Revenue from Exchange transactions 2017 - 18 report | annual 6.2.1 Leases 7. Government Grants / (Transfer Payments and Receipts) Income received from conditional grants, donations and funding are Revenue from the rental of land as operating leases is recognised on a recognised as revenue to the extent that the Ingonyama Trust Board has straight-line basis over the term of the lease agreement, where such lease complied with any of the criteria, conditions or obligations embodied in the periods span over more than one financial year. The Trust leases its land for agreement. commercial and non-commercial purposes. This revenue relates to non- mining revenue. ingonyama trust board trust board ingonyama 84 ingonyama trust board | annual report 2017 - 18 8.1 Financial Assets -Classification 8.1 Assets Financial Instruments 8. Financial NOTES STATEMENTS TOCIAL THEFINAN CH 2018 FORTHEYEARENDED31MAR the notesthe thereto: financial of types assets as face the of on reflected Statement of the Financial Position in or following the has Trust Ingonyama The cash. receive to right contractual a or cash of consisting asset any is asset financial A be can these and instruments broadly categorised Financial as either Financial or Assets Liabilities. financial of types various has Trust The in Statement of the earned Financial Performance. and if is it Ingonyama the Trust Boards interest is it as recognised interest Ifconditions. is it payable of creditor the to as is it part recorded funder the Interest investments on earned is treated with in grant accordance Financial of Statement the in recognised receivable. in which become they in period the Performance are costs, related future no with Board Ingonyama Trust the to support financial immediate giving of as receivable are that forcompensation losses grants expenses or already for or incurred purpose the been Government not recognised. have is obligations liability or a conditions met, criteria, the that extent the To Type of Financial Asset Type Financial of are classified as follows into the categoriesfour allowed thisby standard: In accordance 104,with GRAP the Financial Assets of the Ingonyama Trust Call InvestmentShort-term Deposits – - - - - - Bank Balances and Cash and Balances Bank InvestmentShort-term Deposits Debtors Other Certain Consumer Debtors Investments in Fixed Deposits Held-to-maturity investments Held-to-maturity GRAP of 104 terms in Classification are financial assets that either of meet the following conditions:assets financial are loss or profit through value fair at assets Financial Investments in Fixed Deposits DebtorsOther Consumer Debtors Cash and Balances Bank are financial assets that are designated as designated available are for sale are or not classified as: that assets financial are investments sale for Available and are subject to an insignificantrisk changeof in value. with registered banking institutions with maturities of months three less or held are that cash of amounts known into convertible readilyinvestments, (including call deposits). Cash equivalents highly liquid are short-term cash)Cash includes cash hand on (including petty and cash with banks toability investment hold the to maturity. and intent positive the has Trust the where maturity fixed and payments Investments Held-to-Maturity the using receivables interesteffective rate less aprovision method cost, for impairment. amortised and at measured are Loans Assets Financial recognition assets. non-current as are initiallyrecognised at which cost representsfair value. initial After classified are which months, 12 than greater maturities for except assets, current in included or fixed with assets financial derivativedeterminable payments that are not quoted in an active are market. They non are Receivables and Loans - - - - - the Statement ofthe Financial Performance. initialupon are they recognition designated as at fair value through arethey classified held as trading; for or Performance. Financialat Assets fairvalue through Statement of the Financial or Investments; Held-to-Maturity Loans Receivables; and are financial assets with fixed or determinable or fixed with assets financial are Held-to-maturity investments Held-to-maturity Loans receivables and Available for sale investments NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2018

For the purposes of the cash flow statement, cash and cash equivalents 8.2.1.2 Financial Liabilities: comprise cash on hand, deposits held on call with banks, net of bank overdrafts. The Ingonyama Trust categorises cash and cash equivalents as Financial liabilities at fair value are initially and subsequently measured at financial assets: loans and receivables. fair value. Other financial liabilities are measured at amortised cost using the effective interest rate method. 8.2 Financial Liabilities - Classification 8.2.2 Impairment of Financial Assets A financial liability is a contractual obligation to deliver cash or another Financial assets, other than those at fair value through profit or loss, are financial asset to another entity. The Ingonyama Trust has the following assessed for indicators of impairment at each balance sheet date. Financial types of financial liabilities as reflected on the face of the Statement of assets are impaired where there is objective evidence of impairment Financial Position or in the notes thereto: of Financial Assets (such as the probability of insolvency or significant financial difficulties of the debtor). If there is such evidence the recoverable amount is estimated and an impairment loss is recognised in accordance - Certain Other Creditors with GRAP 104. Initially Accounts Receivable are valued at fair value and subsequently Any other financial liabilities are classified as “Other financial liabilities” and carried at amortised cost using the effective interest rate method. An are initially measured at fair value, net of transaction costs. Other financial estimate is made for doubtful debt based on past default experience of all liabilities are subsequently measured at amortised cost using the effective outstanding amounts at year-end. Bad debts are written off the year in interest method, with interest expense recognised on an effective yield which they are identified as irrecoverable. Amounts receivable within 12 basis. months from the date of reporting are classified as current. 85 In accordance with GRAP 104 the Financial Liabilities of the Ingonyama A provision for impairment of trade receivables is established when there is Trust are all classified as “Other financial liabilities”. objective evidence that the Trust will not be able to collect all amounts due according to the original terms of receivables. The amount of the provision is the difference between the asset’s carrying amount and the present 8.2.1 Initial and Subsequent Measurement value of estimated future cash flows, discounted at the original effective interest rate. 8.2.1.1 Financial Assets: Consumer Debtors are stated at cost less a provision for bad debts. The provision is made in accordance with IAS 39.64 whereby the recoverability Held-to-maturity Investments and Loans and Receivables are initially of Consumer Debtors is assessed individually and then collectively after measured at fair value plus transaction costs that are directly attributable

grouping the assets in financial assets with similar credit risk characteristics. 2017 - 18 report | annual to the acquisition or issue of the financial asset. Subsequently, these assets Government accounts are not provided for as such accounts and are are measured at amortised cost using the Effective Interest Method less regarded as receivable. any impairment, with revenue recognised on an effective yield basis.

Financial Assets at Fair Value and Available-for-Sale are initially and subsequently, at the end of each financial year, measured at fair value with the profit or loss being recognised in the Statement of Financial Performance. ingonyama trust board trust board ingonyama 86 ingonyama trust board | annual report 2017 - 18 8.2.4 De-recognition of8.2.4 Liabilities Financial De-recognition of Assets Financial 8.2.3 De-recognition NOTES STATEMENTS TOCIAL THEFINAN CH 2018 FORTHEYEARENDED31MAR The IngonyamaTrust de-recognises Financial Liabilities when, and only only and Trust’s the when, when, obligations are expire. they or discharged, cancelled Liabilities Financial de-recognises IngonyamaTrust The received. proceeds the for borrowing collateralised a recognises financial asset,the Trustcontinues to recognisethe financial asset and also retainssubstantially all risks the and rewardsof ownership of atransferred associated liability for amounts may it have to pay. If Ingonyama the Trust Ingonyamathe Trust recognises its retained interest in asset the and an asset, transferred the control to continues and ownership of rewards and If Ingonyama the Trust transfers neither retains nor substantially all risks the Financial to due Assets recoverability. non asset the to another entity, except Trust the when of approves write-off the of ownership of rewards and risks the all substantially and asset financial contractual rightsto cash the flowsasset from the expire transfersit or the IngonyamaThe Trust Financial the when only Assets de-recognises impairment recognised. the not been would cost havereversednot what had does exceed amortised the been amount ofinvestment the that carrying the atdate the impairment the is loss impairment is reversed through Statement of the to Financial extent the Performance recognised previously the recognised, a was impairment in and decreases if, loss instruments, impairment the related decrease be the can objectively to an event afterthe occurring equity of amount Available-for-Sale the period, of subsequent exception the With Statement of Financial Performance. amount of allowance the in carrying the account are in recognised the previously are off credited written against allowance the Changes account. againstoff allowance the Subsequent recoveries account. of amounts written is it uncollectible, considered is receivable trade a When account. amount through is use the reduced of an allowancewhere carrying the receivables, trade exception of the with assets financial all for directly loss impairment the by reduced is asset financial the of amount carrying The 8.3.4 Currency risk Currency 8.3.4 8.3.3 risk Liquidity risk Credit 8.3.2 8.3.1 M instruments financial with associated Risks 8.3 be translatedbe to aforeign therefore currency risk currency exists. no IngonyamaThe Trust not does have any transaction that requires funds to Vat and trade payables after year end. have settled been liabilities.financial its service to funds TrustIngonyamasufficient hasThe met. established at rates competitive to ensure that cash requirements flow are are arrangements new additional required, if and, basis timeous a on met Liabilitiesare managed byensuring that all contractual paymentsare at interestmaturity competitive ratesin relation to cash requirements. flow risk isLiquidity managed by ensuring that all assets are reinvested at procedures exist of for collection Debt collection the outstanding payments. Applicants are usually before screened lease applications are approved. purposes. mining and non-mining IngonyamaThe Trust’strade debtors arise leasing fromthe of land for Ingonyama Trust. the to risk a expose not do therefore and end year at fixed and determined ofbecause changes in market as amounts the prices owing are already future cashThe flows from trade and other receivables will not fluctuate investment rates are fixed the at investment date term. over a short fairThe value of investments are not affected by market forces as the the reporting date. reporting the on exposed is Trust the which to of instruments financial extent from and arising risks nature the evaluate to statements financial its of user the It is policy the of Ingonyama the Trust to disclose information that enables arket risk arket NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2018

8.3.5 Interest rate risk The costs of all short-term employee benefits such as leave pay, are recognised during the period in which the employee renders the related Interest rate risk originates from the uncertainty about the fair value or service. The liability for leave pay is based on the total accrued leave days at future cash flows of a financial instrument which fluctuate because of year end and is shown as a creditor in the Statement of Financial Position. changes in market interest rates.

The Ingonyama Trust does not have any interest rate risk as investments 10.2 Contributions to a defined Provident fund contribution plan are fixed at an agreed rate over the term of the investment. The Ingonyama Trust Board and its employees have contributed to the Momentum Umbrella Funds at Work provident fund from 1 February 2011. 9. Provisions The fund is a defined Contribution plan. The contributions are expensed Provisions are recognised when the Ingonyama Trust has a present or and included in the amount reported for under Secretariat administration constructive obligation as a result of past events, it is probable that an fees in the detailed statement of financial performance outflow of resources embodying economic benefits or service potential will be required to settle the obligation and a reliable estimate can be made of the obligation. There are no provisions recorded in the current Financial 10.3 Contributions to a medical aid scheme Statements. Future events that may affect the amount required to settle an obligation are reflected in the amount of a provision where there is sufficient objective The Ingonyama Trust Board and its employees contribute to a medical evidence that they will occur. Provisions are not recognised for future aid scheme. The contributions are expensed and included in the amount 87 operating losses. The present obligation under an onerous contract is reported under Secretariat administration fees in the detailed statement of recognised and measured as a provision. financial performance. Provisions are reviewed at reporting date and the amount of a provision 11. Leases is the present value of the expenditure expected to be required to settle the obligation. When the effect of discounting is material, provisions are 11.1 The Ingonyama Trust as a Lessee determined by discounting the expected future cash flows that reflect current market assessments of the time value of money. The impact of The entity has not entered into any finance lease, however if it does than the the periodic unwinding of the discount is recognised in the Statement of following policy will be applicable. Financial Performance as a finance cost as it occurs. Leases are classified as finance leases where substantially all the risks

and rewards associated with ownership of an asset are transferred to 2017 - 18 report | annual 10. Employee benefits the Ingonyama Trust. Property, plant and equipment or Intangible Assets subject to finance lease agreements are capitalised at amounts equal to the 10.1 Remuneration and Leave pay fair value of the leased asset or, if lower, the present value of the minimum Remuneration to employees is recognised in the Statement of Financial lease payments, each determined at the inception of the lease. Performance as the services are rendered, except for non-accumulating benefits, which are only recognised when the specific event occurs. The Ingonyama Trust treats its provision for leave pay as an accrual. ingonyama trust board trust board ingonyama 88 ingonyama trust board | annual report 2017 - 18 11.2 Deferred finance charge asset related to finance lease liability lease finance to related asset 11.2charge finance Deferred NOTES STATEMENTS TOCIAL THEFINAN CH 2018 FORTHEYEARENDED31MAR consumed. are asset leased the from benefits economic which in pattern time the of representative more is basis systematic another where except basis, line of incentivesis asrecognised ofa reduction rental astraight-on expense aggregateliability. benefit a The as recognised areincentives such leases, In event the that lease incentives are to received enter into operating term which in case the of leased the photocopier is five years. assetis depreciatedof overasset’s the useful shorter the life lease the or recognition of financial instruments are applied tolease payables.The lease accounting policies relating The arecosts incurred. when expensed to de- finance Lease method. rate interest effective the using repayment capital lease payments, which are allocated between the lease property, finance the cost by and the reduced tois liability lease The applicable assets. intangible or equipment policies plant, accounting stated the with in for accordance accounted are assets leased the recognition, initial to Subsequent are incurred. when expensed costs finance Lease capital method. rate the interest effective and the using cost repayment finance lease the between allocated are payments valueto fair the valueof asset the plus any direct Leaseincurred. costs rate that discounts exactly lease payments the and unguaranteed residual interest the Trustuses Ingonyama the payments, lease the discounting In offor effect interest. the discounted agreement, lease of terms the in due payments lease minimum atrecognised inception the of lease the and are measured as sumthe of the initially are liabilities corresponding The Liabilities. Lease Finance as liabilitiesCorresponding are in included Statement of the Financial Position deferredcharge finance financial the in assets statements. recorded termthe of lease the until is it fully utilised. Currently there are no The deferred financecharge asset is reduced byfinance charges over valuelease and finance the liability. the financelease asthethe leased between difference assetcarrying of inception the at recognised is asset charge finance deferred The 14. parties Related Equivalents 13. Cash and Cash 12. V 11.3 Trust aLessor The as alue Tax added reporting directly to the Chief Executive Officer or as designated by the the by designated as or managers Officer. Chief Executive Officer all other Executive and Chief the to directly Officer reporting Financial Chief officer, the Executive are Chief personnel Key decisions. operating and/or financial making in or exercisecontrol the other party significant influence overthe other party jointly or indirectly,control to or ability,directly the has party one if parties Individuals as well as their close family members, and/or entities are related bankon overdrafts are as expensed incurred. overdrafts Bank facility based are the utilised. on recorded charges Finance in financial net instruments, of bank overdrafts. investmentsand banks with call on held deposits hand, on cash comprise equivalents cash and cash statement, flow cash the of purposes the For insignificantrisk changeof in value. institutions with maturities of months three less and or are subject to an highly liquid short-term investmentsthat areheld with registered banking and cash with banks. Cash equivalents are Cash includes cash-on-hand IngonyamaThe Trust accounts for Value Tax Added invoice the on basis. term of relevant the lease. Operating lease rental is astraight-line on recognised income basis over the agreements. investmentnet outstanding in of respect leases the installment or sale so as to rate a constant periodic reflect of return Ingonyama the on Trusts’ leaseFinance installment or is sale allocated income to accountingperiods atamount the ofIngonyama the Trust’s investmentnet inleases. the Amounts due from lessees under financeleases are recorded as receivables NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2018

15. Events after reporting date 19. Changes in Accounting Policies, Estimates and Errors Events after the reporting date that are classified as adjusting events have Changes in accounting policies that are effected by the Accounting been accounted for in the Annual Financial Statements. The events after the Authority have been applied retrospectively in accordance with GRAP 3 reporting date that are classified as non-adjusting events after the reporting requirements, except to the extent that it is impracticable to determine the date have been disclosed in the notes to the Annual Financial Statements. period-specific effects or the cumulative effect of the change in policy. In such cases the Trust shall restate the opening balances of assets, liabilities and net assets for the earliest period for which retrospective restatement 16. Comparative Information is practicable. Changes in accounting estimates are applied prospectively in accordance 16.1 Prior year comparatives with GRAP 3 requirements. Details of changes in estimates are disclosed in When the presentation or classification of items in the Annual Financial the notes to the annual financial statements where applicable. Statements is amended, prior period comparative amounts are reclassified. Correction of Errors is applied retrospectively in the period in which the The nature and reasons for the reclassification are disclosed. error has occurred in accordance with GRAP 3 requirements, except to the extent that it is impracticable to determine the period-specific effects or 16.2 Contingent Assets and Contingent Liabilities the cumulative effect of the error. In such cases the Ingonyama Trust shall Contingent assets and contingent liabilities are not recognised. restate the opening balances of assets, liabilities and net assets for the Contingencies are disclosed in the notes to the annual financial statements. earliest period for which retrospective restatement is practicable.

89 17 . Taxation No provision is made for taxation as the Ingonyama Trust is exempt from income tax in terms of section 10 of the Income Tax Act.

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

2017 - 18 report | annual Irregular and fruitless and wasteful expenditure are recognised against the specific class of events to which they relate and are disclosed in a note to the financial statements when identified.

There were no occurrences of irregular, fruitless & wasteful expenditure during the year. ingonyama trust board trust board ingonyama 90 ingonyama trust board | annual report 2017 - 18

20. NOTES STATEMENTS TOCIAL THEFINAN CH 2018 FORTHEYEARENDED31MAR have adopted early not yet by been Board: the following standardsThe have issued not but GRAP yet and been effective effective yet not but issued interpretations and to standards amendments Standards, on the financial position, financial performance or cash flow of the Ingonyama Trust. of flow cash or performance financial position, impact financial significant the a on have not will standards these of adoption the standardsissued not but yetand effective anticipatedGRAP that has considered all Accounting above the Authority The mentioned Minister of Finance. from a future date to already or by announced be announced the ofApplication all standards of effective will above the GRAP become 110 GRAP 109 GRAP 108 GRAP 38 GRAP 37 GRAP 36 GRAP 35 GRAP 34 GRAP 32 GRAP 20 GRAP D ocument N o T Living and Non-living Resources and Non-living Living Agents Accounting byPrincipals and Receivables Statutory Entities Disclosure of Interests in Other Arrangements Joint Ventures Joint Investments in Associates and Statements Financial Consolidated Statements Financial Separate Grantor Arrangements: Concession Service Disclosures Related Party itle NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2018

Ingonyama Trust 2018 Board Total

21. Property, Plant and Equipment and Heritage R R R R 21.1. Property Plant and equipment Total Cost Accumulated Net book value Net Book value depreciation Property - Office accommodation 65 Trelawney Road 22,066,999 At Cost : Land - 28 January 2009 - - - 1,500,000 Building at cost and improvements to Property - - - 20,566,999

Ingonyama Trust land (other than office accomodation) at fair - - - 28,177,273,170 value Agricultural machinery and equipment - - - 3,255,273 Computer equipment 20,866 (13,355) 7,511 1,132,785 Furniture and equipment 45,476 (32,616) 12,860 2,042,848 Motor vehicles - - - 6,112,876 66,342 (45,971) 20,371 28,211,883,951 91 Property plant and equipment is reconciled as follows:

Opening carrying Depreciation Disposals Change in Ingonyama Trust 2018 Total value estimate Board Closing carrying value Ingonyama Trust Land (Property holdings other than office - - - - - 28,177,273,170 accomodation) Property Phase 2 - office accomodation 65 Trelawney Road - - - - - 22,066,999 | annual report 2017 - 18 report | annual Agricultural machinery and equipment - - - - - 3,255,273 Computer equipment - (1,838) (87) 9,436 7,511 1,132,785 Furniture and equipment 2,465 (4,178) (33) 14,606 12,860 2,042,848 Motor vehicles - - - - - 6,112,876 2,465 (6,016) (120) 24,042 20,371 28,211,883,951

The Trust purchased a property for office accomodation more fully described as Sans Souci, Portion 1 of 1772, Registration Division, FT, Province of KwaZulu Natal in extent 1.5 hectares, trust board ingonyama deed of transfer number T5795/1980. Also known as 65 Trelawney Road, Southgate, Pietermaritzburg, 3201.

The Accounting Authority has reviewed the depreciation method, residual values and useful lives of assets as at 31 March 2018. (refer to note 34 for change in residual values). 92 ingonyama trust board | annual report 2017 - 18 21.1 Property, Plant and Equipment is reconciled as follows follows as reconciled is Equipment 21.1 and Plant Property, Property -office accomodation65 Property Trelawney Road Agricultural machinery andequipment Agricultural machinery Ingonyama Trust land(other thanofficeaccomodation) Furniture andequipment equipment Computer Motor vehicles Agricultural machinery andequipment Agricultural machinery Office accomodation65 Trelawney Road Ingonyama Trust holdings otherthanofficeaccomodation) land(Property Furniture and equipment Computer equipment Computer Motor vehicles NOTES STATEMENTS TOCIAL THEFINAN CH 2018 FORTHEYEARENDED31MAR Opening carrying Opening carrying value Cost R 72,836 50,669 22,167 6,800 6,800 ------Accumulated Depreciation depreciation R (70,371) (48,204) (22,167) (4,335) (4,335) ------Ingonyama Trust Ingonyama Closing carrying Closing carrying Carrying value Carrying B value oard R 2,465 2,465 2,465 2,465 ------28,208,014,898 28,208,014,898 28,177,273,170 28,177,273,170 2017 Total Total 2017 2017 21,330,403 21,330,403 R 3,100,968 3,100,968 4,709,543 1,164,084 1,164,084 4,709,543 436,730 436,730 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2018

21.2 Property holdings per registration divisions

2018 Changes in 2017 2018 2017 Hectares property holdings Hectares Land value Land value

ES 34,564 34,564 2,804,267,760 2,804,267,760 ET 265,467 265,467 12,118,342,070 12,118,342,070 FS 115,670 115,670 537,385,962 537,385,962 FT 251,203 251,203 989,162,004 989,162,004 FU 53,967 53,967 296,214,078 296,214,078 GS 102,175 102,175 439,916,581 439,916,581 GT 491,860 747 491,113 1,309,165,787 1,309,165,787 GU 651,739 651,739 7,822,278,575 7,822,278,575 GV 79,547 79,547 9,913,518 9,913,518 HT 25,896 25,896 127,391,620 127,391,620 93 HU 335,626 335,626 127,970,000 127,970,000 HV 475,609 475,609 1,590,423,739 1,590,423,739 Townships 129 129 4,841,476 4,841,476

2,883,452 2,882,705 28,177,273,171 28,177,273,171

Ingonyama Trust land vested to the Ingonyama Trust in 1994 in terms of the Ingonyama Trust Act, 1994 at no cost to the Ingonyama Trust. In 2017/2018 Land has been valued using the average municipal value per hectare specific to a municipal area and disclosed as such in terms of GRAP 17. The effective date of the valuation is 01 April 2016. | annual report 2017 - 18 report | annual The Ingonyama Trust land is used for residential, institutional and commercial such as : Shopping centres, hotels, game reserves, dams and by telecommunication service providers. ingonyama trust board trust board ingonyama 94 ingonyama trust board | annual report 2017 - 18 22. Heritage Assets Heritage 22. Computer software Computer Heritage assetarereconciledasfollows: No impairmentswere notedfortheyear. Sans Soucibuilding-Phaseone Intangible assets are reconciled as follows : follows as reconciled are assets Intangible design Website 23. Intangible assets23. Intangible Sans Soucibuilding-Phaseone Computer software Computer Website design Website NOTES STATEMENTS TOCIAL THEFINAN CH 2018 FORTHEYEARENDED31MAR Opening Carrying Carrying value - - - Amortisation Cost R (3,922) 47,062 (3,922) 47,062 - -

Ammortisation Ammortisation Accumulated Change in estimate R (27,738) (27,738) 23,246 23,246

- - Trust Board Trust Board Trust Board Ingonyama Ingonyama Ingonyama Net book Carrying Carrying Closed value value R 19,324 19,324 19,324 19,324

- - - - - 15,988,144 15,988,144 15,988,144 2018 2018 2018 2018 Total Total Total Total 896,400 896,400 812,418 812,418 83,982 83,982 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2018

Ingonyama Trust Board R R R R 2017 Net book Cost Accumulated Net book Total value amortisation value

Computer software 232,902 47,062 (47,062) - 232,902 Website design - - - - - 232,902 47,062 (47,062) - 232,902

Intangible assets are reconciled as follows: Opening Amortisation Closing 2017 Carrying carrying Total value value Computer software - - - 232,902 95 Website design ------232,902

24. Depreciation R R Ingonyama 2018 Trust Board Total The depreciation/amortisation charge is calculated as follows. | annual report 2017 - 18 report | annual Buildings - 977,156 Agricultural machinery and equipment - 898,095 Computer equipment 1,838 158,296 Furniture and equipment 4,178 298,103 Motor vehicles - 660,818 ingonyama trust board trust board ingonyama 96 ingonyama trust board | annual report 2017 - 18 Trade debtors 25.1 Receivables from transactions exchange 25. Receivables Straight lining lease income debtors income lease lining Straight Less :Provision for debts doubtful Trade debtors including Leases -actual straight (non lining lease debtors income ) Refund/purchase price due from service provider Refund/purchase for assets purchased from due service price Private usage of telephone and leave pay held by Deposit Msunduzi Municipality for Trelawney 65 Electricity Road Accrued interest Accrued Receivables Other (page 120) (page Ingonyama Trust -Statement of Board of Comparison and budget actual amounts 118) (page Ingonyama Trust -Statement of of Comparison and budget actual amounts is Depreciation Net disclosed as Intangible assets and software website -Computer design NOTES STATEMENTS TOCIAL THEFINAN CH 2018 FORTHEYEARENDED31MAR Trust Board Ingonyama R 16,875 16,875 9,938 9,938 9,938 3,922 ------(25,518,690) 419,305,030 467,937,545 46,897,685 46,897,685 72,416,375 3,113,207 3,113,207 1,616,068 3,103,269 2018 Total 120,739 R 88,000 13,887 16,875 9,938 Trust Board Ingonyama 2,675 R 2,675 ------423,199,590 355,245,287 (9,358,280) 66,199,845 66,199,845 75,558,125 1,630,306 2017 Total 88,000 R 13,887 22,265 - NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2018

The Straight lining lease income debtors is calculated as the difference in income between the amount invoiced per the lease agreements and the determination of lease income per the straight lining method adopted.

R R R R Ingonyama 2018 Ingonyama 2017 Trust Board Total Trust Board Total 25.2 Receivables from non - exchange transactions

South African Revenue Services - vat refund 130,174 252,914 - -

26. Cash and cash equivalents

Current Accounts 4,175 2,208,742 977,547 2,974,878 Call account / fixed deposits - 203,229,893 - 195,891,694 Petty cash 3,818 3,986 3,676 3,777 97

7,993 205,442,621 981,223 198,870,349

Cash and Cash equivalents are current in nature as fixed deposits mature within four months.

The average interest rate during the year was between 2.50 % and 8.00 %. Cash and Cash equivalents were not encumbered/secured during the year. | annual report 2017 - 18 report | annual Funds are available to community beneficiaries, subject to them complying with the Board's disbursement policy.

Cash and cash equivalent balances held by the Trust are available for use. There are no restricted cash balances as at 31 March 2018. ingonyama trust board trust board ingonyama 98 ingonyama trust board | annual report 2017 - 18 South African Revenue Services -vat payable Revenue African Services South transactions 27.2 -exchange non from Payables which is to used term basis. pay operational expenditure ashort on provided has byA credit been card First National card 000 facility of Bank R500 Leave pay is calculated at year end. sites sold not but yet transferred to municipalities the at year end. land on disposalAdvance proceeds refers to from municipalities monies received for Advance payment by debtors relate to amounts in received advance for tenure rights. Advance payments by debtors Credit Card facility -FNB Leave pay accrual Sundry creditors Sundry Advance proceeds on property/(land) disposal property/(land) on Advance proceeds Trade creditors 27.1 transactions exchange from Payables Payables 27. NOTES STATEMENTS TOCIAL THEFINAN CH 2018 FORTHEYEARENDED31MAR Trust Board Ingonyama 588,809 540,360 R 48,449 - - - - - 18,210,020 15,630,023 1,067,211 1,365,482 2018 Total R 77,600 48,449 21,255 - Trust Board Ingonyama 670,480 147,404 523,076 R - - - - - 17,754,496 3,994,448 13,692,372 1,199,850 2,563,298 2017 Total 147,404 R 77,600 73,972 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2018

R R R R Ingonyama 2018 Ingonyama 2017 Trust Board Total Trust Board Total 28. Correction of Prior Period Error 28.1 Correction of prior period error - Property - land valuation

Land vested to the Ingonyama Trust in 1994 has been valued at R 28 billion in 2017/2018 based on municipal valuations. A prior year adjustment has been made to fairly present the land value of the prior year. Land and accumulated surplus has been increased by R 28 billion.

Property, plant and equipment

Re-stated - 28,211,863,580 - 28,208,012,433 Previously reported - 34,590,410 - 30,739,263 Net gains from fair valuation adjustment (land holdings) - 28,177,273,170 - 28,177,273,170 99 | annual report 2017 - 18 report | annual ingonyama trust board trust board ingonyama 100 ingonyama trust board | annual report 2017 - 18 28.2 Correction of prior period error - lease income income -lease error period prior of Correction 28.2 Opening balance : 01.04.2016 : balance Opening surplus has increased by for 2016/2017. R3.3m Trade period. in prior the lessees debtors increased by and accumulated R3.3m the by occupation to due periods prior for rental charging current, the into entered been have agreement Lease periods. respective their in years 2016/2017 prior and adjustment forAn account made for to has lease accrued been correctly income Increase lining in Straight for income 2015/2016 Increase in lease for income 2015/2016 Adjustments to retained for income 2015/2016 Balance: 01.04.2017Balance: income lining Straight in Increase Increase in lease for income 2016/2017 Retained earnings previously reported earnings for year the Re-stated NOTES STATEMENTS TOCIAL THEFINAN CH 2018 FORTHEYEARENDED31MAR Trust Board Ingonyama R ------653,243,772 553,023,717 2018 Total 96,529,059 98,787,729 2,258,670 1,113,845 1,432,326 2,188,152 R 318,481 70,518 Trust Board Ingonyama R ------554,456,043 553,023,717 2017 Total 1,113,845 1,432,326 318,481 R - - - - - NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2018

R R R R Ingonyama 2018 Ingonyama 2017 Trust Board Total Trust Board Total

29. Board members’ fees 5,165,723 5,165,723 3,230,586 3,230,586 Chairperson - Mr Justice S J Ngwenya 1,687,083 1,687,083 1,196,532 1,196,532 Basic 1,365,380 1,365,380 955,407 955,407

Subtotal 1,365,380 1,365,380 955,407 955,407 Subsistence and Travel 321,703 321,703 241,125 241,125

Advocate W E R Raubenheimer 418,735 418,735 331,371 331,371 Basic 412,902 412,902 327,748 327,748

Subtotal 412,902 412,902 327,748 327,748 101 Subsistence and Travel 5,833 5,833 3,623 3,623

Pastor N B Dinzenza - - 61,807 61,807 Basic - - 61,397 61,397

Subtotal - - 61,397 61,397 Subsistence and Travel - - 410 410 | annual report 2017 - 18 report | annual

Ms J Bhengu 501,002 501,002 309,136 309,136 Basic 485,675 485,675 303,198 303,198

Subtotal 485,675 485,675 303,198 303,198 Subsistence and Travel 15,327 15,327 5,938 5,938 ingonyama trust board trust board ingonyama 102 ingonyama trust board | annual report 2017 - 18 Inkosi WTM Inkosi Inkosi S E Shabalala M M Dr r B NOTES STATEMENTS TOCIAL THEFINAN CH 2018 FORTHEYEARENDED31MAR L Shabalala SM Subsistence and Travel Subtotal Basic Subsistence and Travel Subtotal Basic Subsistence and Travel Subtotal Basic Subsistence and Travel Subtotal Basic batha avundla Trust Board Ingonyama 514,520 615,094 259,353 280,812 171,883 443,211 443,211 216,858 216,858 126,678 387,842 387,842 233,751 233,751 R 25,602 63,954

2018 Total R 259,353 514,520 615,094 280,812 171,883 443,211 443,211 216,858 216,858 126,678 387,842 387,842 233,751 233,751 25,602 63,954

Trust Board Ingonyama 206,530 211,819 152,506 421,281 300,038 300,038 150,474 150,474 113,607 113,607 121,243 191,793 191,793 R 20,026 56,056 38,899

2017 Total 211,819 152,506 421,281 206,530 300,038 300,038 150,474 150,474 113,607 113,607 121,243 191,793 191,793 R 20,026 56,056 38,899

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2018

R R R R Ingonyama 2018 Ingonyama 2017 Trust Board Total Trust Board Total

Inkosi P R Bele 550,094 550,094 256,600 256,600 Basic 423,890 423,890 188,784 188,784

Subtotal 423,890 423,890 188,784 188,784 Subsistence and Travel 126,204 126,204 67,816 67,816

Inkosi Z T Gumede 339,030 339,030 83,004 83,004 Basic 190,893 190,893 - -

Subtotal 190,893 190,893 - -

Subsistence and Travel 148,137 148,137 83,004 83,004 103 | annual report 2017 - 18 report | annual ingonyama trust board trust board ingonyama 104 ingonyama trust board | annual report 2017 - 18 Chief Executive Officer Executive Chief 30. G plan for the year amounted to R 644 652 (2017plan for year the amounted to R644 -R759 408). The total contributions ( employer and employee portion ) to the defined contribution Plan. Contribution Provident defined to the 31. Contributions M officer Financial Chief anager - Corporate Services - Corporateanager Services NOTES STATEMENTS TOCIAL THEFINAN CH 2018 FORTHEYEARENDED31MAR ross remuneration of senior managers senior of remuneration ross Basic Basic Housing allowance Basic Allowance Cash Company contributions to uif and skills levy Company contributions to uif and skills levy Travel allowance and cell phone Basic Company contributions to uif and skills levy Trust Board Ingonyama 1,462,661 2,481,017 1,316,412 956,661 130,000 283,606 662,394 61,695 R 60,938 10,661 16,249 757 - 2018 Total 1,462,661 2,481,017 1,316,412 R 956,661 130,000 283,606 662,394 61,695 60,938 10,661 16,249 757 - Trust Board Ingonyama 1,551,837 766,957 276,180 508,700 682,500 150,879 352,052 273,231 R 75,833 2,949 8,624 5,769 - 1,314,784 2,469,475 1,170,000 2017 Total 276,180 878,511 606,745 261,833 273,231 R 75,833 54,167 14,784 2,949 9,933 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2018

32. Events after the Reporting Date

We bring to your attention that besides the under-metioned matter, there were no other significant subsequent events that need to be reported.

NAME OF ENTITY DESCRIPTION OF MATTER AMOUNT

Ron Wilson -Mnini Dam Mr Wilson has instructed his lawyers to initiate legal proceeding against ITB and is 1,977,600 Watersport Resorts,lesee on claiming loss of income for having his lease unlawfully terminated. Ingonyama Trust land.

33. Related party transactions

a) A Land Availability Agreement has been granted to Ketshe Investments CC. Justice S.J Ngwenya, a Board member, is a shareholder of this company. There is no consideration for Land Availability Agreements in terms of the Board’s policy. b) A lease agreement was granted to Zwelibanzi Utilities ( Pty) Ltd . Judge S. J Ngwenya, a Board member is a shareholder of this company. Rental amounting to R 64 876.32 is payable for the 2017/2018 financial year. At year end an amount of R 281 779.47 was owing to the Trust. c) A lease agreement is granted to Mkhathi Manufacturing & Distributors CC. Dr F.Madlopha, the CEO is the member of the close Corporation.The lease 105 commenced on 1 February 2009. Rental amounting to R 14 784.72 is payable for the 2017/2018 financial year. At year end an amount of R 13 225.32 was owing to the Trust. There is no provision made for doubtful debts relating to related parties as these debts are recoverable. | annual report 2017 - 18 report | annual ingonyama trust board trust board ingonyama 106 ingonyama trust board | annual report 2017 - 18 34.2 Change in accounting estimate - Re-assessment of useful of assets assets of useful of -Re-assessment estimate accounting in Change 34.2 M of value -Residual estimate accounting 34.1 in Change estimate accounting in Change 34. NOTES STATEMENTS TOCIAL THEFINAN CH 2018 FORTHEYEARENDED31MAR Total Intangible Assets Computer Equipment Computer Furniture and Equipment followingThe illustrates decrease the in depreciation and increase in Accumulated Fund: of in Ingonyama 236 the R285 Trust and an increase in depreciation of R7473 in Ingonyama the Trust for Board current the year. Accumulated increasing fund by for 695 Ingonyama R2.99 mand the R39 Trust and Ingonyama Trust respectively. Board was There adecrease in depreciation A change in estimate useful the on life of computer equipment,furniture &equipment and intangible assets has resulted and equipment in Property,plant the and decrease in depreciation andThe accumulated depreciation for current the year is R10 186.06 to due change in the residual values. Future profits will also increase by R depreciable amountthe as thus266.00 woulddecreased, be resulting134 depreciationlesser in futurein years. residualThe value of motor vehicles has increased by R134 resulting 266 in achange in an accounting estimate. year trading values. residualThe value of all Ingonyama Trust vehicles was assessed at year end.The change in estimate current and previous is betweeen difference based the on otor vehicles otor opening balance balance opening accumulated depreciation depreciation Change to Change 47,288 47,288 23,246 23,246 14,606 9,436 9,436 assets 2017/2018 2017/2018 assets Change in loss loss in Change on disposal of of disposal on (120) (87) (33) - Ingonyama Trust B Depreciation Depreciation Change in in Change 2017/2018 2017/2018 (7,473) (3,922) (1,838) (1,713) oard Sub-Total 39,695 12,860 19,324 7,511 Total 3,028,510 1,269,374 838,099 838,099 921,037 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2018

Ingonyama Trust Board

Depreciation Depreciation Difference Total Based on Old Based on New Useful Lives Useful Lives

Computer Equipment - 1,838 (1,838) 71,598

Furniture and Equipment 2,465 4,178 (1,713) 152,303

Intangible Assets - 3,922 (3,922) 53,862

Total 2,465 9,938 (7,473) 277,763

107 | annual report 2017 - 18 report | annual ingonyama trust board trust board ingonyama 108 ingonyama trust board | annual report 2017 - 18 35. Lease income and Straight lining of Lease income Lease of lining Straight and income 35. Lease NOTES STATEMENTS TOCIAL THEFINAN CH 2018 FORTHEYEARENDED31MAR receivable are noted in aggregate as follows: followingThe future actual lease operating income are There contingent no rentsterm period. as recognised revenue for year the review. under TrustThe as lessor enters into cancellable operating land and lease long agreements over a short Increase in netsurplus and trade debtor balances for year the Rental as straight per income lining method Rental invoiced income as lease per agreements Trade debtor balances as follows: resultThe from changing lease to income straight the line basis has increased surplus the and purposes. commercial IngonyamaThe Trust leases Trust and term long basis for land ashort on residential and iii) ii) i) not later than year, one later than year one and not later than five and years, later than five years, Ingonyama Trust Ingonyama B oard ------2018 Total 3,751,841,443 3,751,841,443 133,260,967 64,059,743 64,059,743 28,720,458 28,720,458 92,780,201 34,102,154 34,102,154 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2018

Ingonyama Trust 2018 Total Board 36. Commitments

i) not later than one year, 156,015 156,015

ii) later than one year and not later than five years 2,286 2,286

The commitments relate to potential contracts for operational expenditure.

37. Contingent liability

37.1 Contingent liability - Rates

Ingonyama Trust land amongst others is subject to Municipal property rates act. As a result all - 138,327,395 municipalities rate Ingonyama Trust land. However, firstly municipalities have categories of rateable properties in terms of which they are required to rate various properties. 109 Ingonyama Trust Board hold the view that rates become due and payable after compliance with prescripts which include the constitution. It has raised the prescripts with various municipalities as a result of which some municipalities have:-

i) Written - off the claim raised.

ii) Exempted Ingonyama Trust land from rateable properties

Some municipalities regardless of compliance with prescripts continue rating Ingonyama Trust land, and some have issued summons against Ingonyama Trust and some have declared a dispute in 2017 - 18 report | annual terms of the Intergovernmental Relations Framework Act of 2005. Whilst that the Ingonyama Trust Board believes these claims are not sustainable it nevertheless raised the provision of the contingent liabilities to the amount above. ingonyama trust board trust board ingonyama 110 ingonyama trust board | annual report 2017 - 18 37.2 Other legal matters in court in matters 37.2 legal Other NOTES STATEMENTS TOCIAL THEFINAN CH 2018 FORTHEYEARENDED31MAR for rates. contributions tobound beneficiaries from the seek In light the of this Ingonyama the Trust in Board discharging its mandate is duty municipality. for complete exemption of rates treated or in terms of indigent the policy of the qualify generally would land Trust Ingonyama populate who beneficiaries the of IngonyamaThe Trustnot does receive anygovernmental grants and majority the N land Ingonyama Trust Mpeko, on lesee EdwardMr ame of entity of ame

property. was restored to him. Mr Mpeko is claiming damages to the against Mpeko Mr E. Ingonyama after the Trust property is attempting entity The to revive applicationan eviction D escription of matter of escription Ingonyama Trust Ingonyama B oard - - 2018 Total 6,356,652 6,356,652 6,356,652 6,356,652 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2018

38. Reconciliation of budget surplus with surplus in the statement of financial Ingonyama Trust 2018 Total Ingonyama Trust 2017 Total performance Board Board

Available funds transferred to Accumulated Fund (7,593) 63,218,537 - 98,787,729

Adjusted for:

less : straight lining lease income not budgeted - 64,059,743 - 75,524,672

Depreciation/amortisation 9,938 3,113,207 4,335 3,517,212

Transfer of funds to Accumulated fund - (13,599,629) - (44,736,697)

(Loss)/Profit on disposal of assets 120 (42,990) - 320,472

Budgeted income not received - Board (59,933) (59,933) - -

Actual expenditure less than Budget - Board 57,468 57,468 (4,335) (4,335)

Income received in addition to the budget - Trust - (67,142,681) - (18,096,238) 111

Actual expenditure less Budget - Trust - (49,603,722) - (115,312,815)

Net surplus per approved budget - - - -

The Ingonyama Trust Board does not budget for an operating surplus or loss. | annual report 2017 - 18 report | annual ingonyama trust board trust board ingonyama 112 ingonyama trust board | annual report 2017 - 18 39. Notes to the Cash Flow Statement Flow Cash to39. the Notes A) NOTES STATEMENTS TOCIAL THEFINAN CH 2018 FORTHEYEARENDED31MAR Reconciliation of net cash flows from operating activities to surplus activities operating from flows cash of net Reconciliation Profit on Profit disposal/impairment of assets Depreciation/amortisation Decrease inDecrease payables -exchange from non transactions Increase in provision of debts doubtful Increase in -exchange receivables from non transactions Increase in receivables from exchange transactions Increase in payables from exchange transactions Net cash flows from operating activities flowsoperating from cash Net Increase in Accumulated Fund movements Non-cash Fund to Accumulated transferred funds Available Transfer to/out of accumulated Fund Ingonyama Trust Ingonyama B oard (973,230) ( 47,967) (4 (397,554) (130,174) 10,058 (7,593) 9,938 9,938 120 120 - - - - 2018 Total (20,902,629) (61,016,248) (3,994,448) 11,474,263 63,218,537 12,945,929 12,945,929 16,160,410 16,160,410 14,531,711 3,113,207 (252,914) 573,407 573,407 43,230 43,230 Ingonyama Trust Ingonyama B oard 705,029 705,029 544,560 544,560 156,134 4,335 4,335 4,335 4,335 ------2017 Total (95,943,894) (1,088,249) (7,268,031) 98,787,729 98,787,729 1,308,028 1,308,028 7,087,611 7,087,611 4,787,465 1,675,013 (320,472) 3,517,213 544,560 544,560 - NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2018

Ingonyama Trust 2018 Total Ingonyama Trust 2017 Total Board Board

B) Property, Plant and equipment and intangible assets

During the 2017/2018 year the Trust acquired property,plant and equipment and intangible assets at a cost of R 4 979 122 as follows : own funds own funds

Property - Office accommodation construction costs - 1,713,752 - 460,970

Agricultural machinery and equipment - 1,052,400 - -

Computer equipment - 4,955 - 128,155

Furniture and equipment - 63,763 - 2,244

Motor vehicles - 2,144,252 - - 113 Intangible assets - computer software/website design - - - 47,880

- 4,979,122 - 639,249

C) Cash and cash equivalents

Cash and cash equivalents included in the cash flow statement comprise the following statement of amounts indicating the financial position : | annual report 2017 - 18 report | annual

Cash on hand and balances with banks 7,993 2,212,728 981,223 2,978,655

Short-term investments - 203,229,893 - 195,891,694

7,993 205,442,621 981,223 198,870,349

The entity had no borrowing facillity as at 31 March 2018. ingonyama trust board trust board ingonyama 114 ingonyama trust board | annual report 2017 - 18 40. instruments Financial NOTES STATEMENTS TOCIAL THEFINAN CH 2018 FORTHEYEARENDED31MAR The following balances are exposed to Credit risk to Credit exposed are balances following The risk to Liquidity exposed are balances following The instruments: TrustThe has exposure to following the risks from its use of financial of course normal Trusts’s the business. to currency,Exposure interest rate, credit risk and liquidity risks arise in the 8. Accounting policies regardingThe financial instruments are disclosed notein The following balances are exposed to Interest rate risk rate to Interest exposed are balances following The Consumer / trade debtors / trade Consumer Payables and Trade creditors Risk Credit Risk Rate Interest Risk Liquidity Investments in fixeddeposits other debtsCertain Bank Balances and Cash Cash and Balances Bank Ingonyama Trust Ingonyama B oard 468,605 468,605 476,598 7,993 - - 2018 Total 203,229,893 203,229,893 18,640,766 61,571,110 2,444,283 2,444,283 2,212,728 Ingonyama Trust Ingonyama B oard 986,363 986,363 981,223 2,675 - - 2017 Total 195,891,694 22,064,827 66,199,845 2,070,341 2,978,655 2,978,655 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2018

R R 2018 2017

41. Contingent asset - Wesbank 59,933 -

Monies due to the Ingonyama Trust Board by Wesbank for the unauthorised use of the the ITB’s petrol card accounts by unknown person/s pending the investigation by Wesbank thereof.

42. Trust and Board expenditure 66,491,438 47,832,113

Agricultural Project expenses 453,820 4,291,646

Advertisements 327,754 398,412

Audit fees 1,117,034 760,460

Internal audit committee members' fees 52,347 9,379 115 Bank charges 64,943 64,963

Board members' fees (excluding travel re-imbursement) 4,160,522 2,639,182

Cleaning repairs & general expenses 1,216,063 978,822

Computer software 325,149 186,620

Depreciation/amortisation 3,113,207 3,517,212

Audit fees- internal 210,000 4,254 2017 - 18 report | annual

Insurance 626,978 526,164

Legal fees 5,208,876 1,528,287

Maintenance of land tenure information system 41,161 31,767

Balance c/f 16,917,854 14,937,168 ingonyama trust board trust board ingonyama 116 ingonyama trust board | annual report 2017 - 18 NOTES STATEMENTS TOCIAL THEFINAN CH 2018 FORTHEYEARENDED31MAR Loss use unauthorised on of petrol cards Loss disposal on of assets Audit of infrastructure IT assets tenureLand upgrade and formalisation of settlements Bursaries -FundaBursaries Zulu Rent office -Ulundi ITB expenses Human resources and communication Workshops and roadshows expenses Security Telephone Organogram - restructuring costs restructuring - Organogram Rates and municipalaccommodation charges -office administrationSecretariat fees Motor vehicle expenses Travelling,accommodation travel) expenses (including and members meeting Board training Staff Increase in provision for debts doubtful and identification management plan/landLand audits printing and Stationery Balance b/f Balance 16,917,854 66,491,438 2018 21,969,634 16,160,410 16,160,410 2,692,277 2,692,277 1,034,097 3,421,039 R 644,604 644,604 234,048 234,048 322,070 322,070 399,821 399,821 539,704 708,796 225,792 513,650 591,768 43,230 43,230 59,933 59,933 12,711 - - 14,937,168 47,834,113 2017 21,767,920 2,691,248 3,358,161 1,675,013 R 330,000 330,000 108,000 630,070 630,070 292,658 292,658 596,535 596,535 275,270 275,270 214,563 631,905 136,075 187,527 - - - - - trust fund - statement of comparison of budget and actual amounts for the YEAR ENDED 31 MARCH 2018

Notes Approved Shift of Final Budget Actual 2018 Variance Actual 2017 Budget 2018 funds & 2018 2018 Additional funds Revenue

Leases( including straight lining income) 11 & 35 - - - 64,059,743 64,059,743 75,524,672

Lease income actual 22,045,190 - 22,045,190 28,720,458 6,675,268 33,563,815

Net rental revenue 22,045,190 - 22,045,190 92,780,201 70,735,011 109,088,487

Royalty revenue from mining activities on IT land 2,605,425 - 2,605,425 794,157 (1,811,268) 922,424

Interest on Bank and Short term investments 16,965,148 - 16,965,148 15,092,894 (1,872,254) 14,645,841

Servitude compensation and other income 250,000 - 250,000 410,498 160,498 1,772,637 117 Interest on debtors overdue accounts 820,000 - 820,000 750,694 (69,306) 990,876

From reserves 76,212,219 (4,149,777) 72,062,442 - - -

Profit on impairment/disposal of assets - - - - - 320,472

Total Revenue 118,897,982 (4,149,777) 114,748,205 109,828,444 67,142,681 127,740,737

Less: Transfer of funds (38,417,187) - (38,417,187) - 38,417,187 - | annual report 2017 - 18 report | annual

Revenue available for Trust and Board use 80,480,795 (4,149,777) 76,331,018 109,828,444 105,559,868 127,740,737 ingonyama trust board trust board ingonyama 118 ingonyama trust board | annual report 2017 - 18 trust fund-statement ofcomparison andactual ofbudget amounts 2018 fortheYEARENDED31MARCH Rent office -Ulundi ITB Workshops Agricultural expenses Secretariat administrationSecretariat fees and leave pay provision Maintenance of land tenure information system Staff training Staff and identification management plan/landLand audits Increase in provision for debts doubtful tenureLand upgrade and formalisation of settlements Legal fees Legal Depreciation/amortisation Cleaning expenses repairs general & charges Bank Advertisements Less: Portion for B for Portion Less: oard and Trust use and oard Notes 24 58,680,795 B udget 2018udget Approved 11,000,000 3,635,000 3,635,000 3,873,801 3,873,801 1,557,064 4,467,115 600,000 800,000 300,000 550,000 100,000 402,067 402,067 80,730 - - (4,149,777) Additional Additional (4,370,000) funds & funds Shift of of Shift 3,655,000 3,655,000 (400,000) funds 700,000 365,000 365,000 50,000 ------54,531,018 Final B 6,630,000 6,630,000 3,635,000 3,635,000 1,500,000 3,873,801 3,873,801 5,212,064 4,467,115 2018 600,000 665,000 665,000 100,000 402,067 402,067 150,000 50,000 80,730 udget udget - 46,602,314 46,602,314 Actual 2018 Actual 16,160,410 16,160,410 2,692,277 2,692,277 5,208,876 5,208,876 1,034,097 3,103,269 453,820 453,820 662,783 662,783 (44,190) 591,768 327,754 49,112 41,161 - - 7,928,704 7,928,704 (14,660,410) V 2,600,903 2,600,903 ariance 1,774,838 6,176,180 6,176,180 2018 150,000 770,532 770,532 58,839 58,839 94,190 74,313 31,618 31,618 8,232 8,232 2,217 3,188 - Actual 2017 Actual 28,953,008 28,953,008 4,291,646 4,291,646 3,512,877 1,528,287 3,358,161 1,675,013 9,681,186 9,681,186 108,000 292,658 292,658 366,479 366,479 398,412 63,814 31,767 - - trust fund - statement of comparison of budget and actual amounts for the YEAR ENDED 31 MARCH 2018

Notes Approved Shift of Final Budget Actual 2018 Variance Actual 2017 Budget 2018 funds & 2018 2018 Additional funds

Communication expenses 330,000 - 330,000 234,048 95,952 187,527

Provision of rates payable to municipalities for ITB land 10,000,000 - 10,000,000 - 10,000,000 -

Review and maintenance of policies 402,826 - 402,826 - 402,826 -

Audit Committee members' fees - - - - 28

Computer fees 490,000 - 490,000 244,072 245,928 186,620

Asset tagging expenses 5,000 - 5,000 - 5,000 -

Motor vehicle expenses - - - - - 19,456

Loss on disposal of assets - - - 43,110 (43,110) - 119 Audit of IT infrastructure assets - - - 399,821 (399,821) -

Bursaries - Funda Zulu 550,000 - 550,000 12,711 537,289 330,000

Transfer of funds to Ingonyama Trust Board 19,537,192 (4,149,777) 15,387,415 15,387,415 - 2,921,077

Available funds transferred to Accumulated Fund 21,800,000 - 21,800,000 63,226,130 97,631,164 98,787,729 | annual report 2017 - 18 report | annual Capital expenditure 21,800,000 - 21,800,000 (4,979,122) 16,820,878 (639,249)

Total - - - 58,247,008 114,452,042 98,148,480 ingonyama trust board trust board ingonyama 120 ingonyama trust board | annual report 2017 - 18 DEPARTMENTAL /TRANSFERPAYMENT -STATEMENT OFCOMPARISON ANDAC OFBUDGET Depreciation/amortisation Loss disposal on of assets maintenance and software/licencing Computer Internal fees members' Audit Committee Transfer payments received Transfer payments Revenue Transfer Ingonyama from Trust Investment income Investment Total Revenue Total Expenditure Insurance Secretariat administrationSecretariat fees charges Bank Motor vehicle expenses fees members' Board Audit Fees - - - previous years current external

Notes 29 24 20,359,935 20,359,935 20,359,935 20,359,935 Approved baseline baseline 19,727,400 B 8,959,254 8,959,254 2,704,173 udget 540,000 540,000 872,990 872,990 872,990 872,990 106,342 567,200 272,734 65,335 65,335 18,233 7,834 - - - (1,274,797) Shift of of Shift TUAL AMOUNTSCH 2018 FORTHEYEARENDED31MAR 1,375,723 funds 244,044 244,044 244,044 244,044 (25,265) (5,369) 49,336 49,336 86,978 15,831 34,114 ------addition to addition Funding in in Funding 14,732,058 14,732,058 14,643,262 14,643,262 14,324,558 14,324,558 baseline 89,196 (400) ------Final B 35,209,013 35,209,013 22,013,824 15,327,482 19,727,000 4,160,522 1,117,034 1,117,034 1,117,034 1,117,034 322,070 322,070 154,531 626,978 626,978 52,347 52,347 81,077 15,831 udget 2,465 2,465 - - Actual 2018 Actual 35,268,946 35,276,539 35,276,539 22,013,824 19,727,000 15,387,415 15,387,415 4,160,522 1,117,034 1,117,034 1,117,034 1,117,034 322,070 322,070 154,531 626,978 626,978 52,347 52,347 81,077 15,831 9,938 9,938 120 120 - V ariance 2018 (67,526) 59,933 59,933 59,933 59,933 (7,473) (120) ------Actual 2017 Actual 21,800,182 21,800,182 21,800,182 21,800,182 18,788,000 12,086,734 2,921,077 2,639,182 760,460 760,460 760,460 760,460 255,814 526,164 91,105 4,335 4,335 9,351 1,149 - - - DEPARTMENTAL / TRANSFER PAYMENT - STATEMENT OF COMPARISON OF BUDGET AND ACTUAL AMOUNTS FOR THE YEAR ENDED 31 MARCH 2018

Notes Approved Shift of Funding in Final Budget Actual 2018 Variance Actual 2017 baseline funds addition to 2018 Budget baseline Stationery & printing 550,938 93,666 - 644,604 644,604 - 630,070

Travel,accommodation & meeting 2,840,589 548,865 - 3,421,039 3,421,039 - 2,691,248 expenses Telephone 240,000 (14,208) - 225,792 225,792 - 214,563

Security expenses 720,000 (283,704) 272,500 708,796 708,796 - 631,905

Cleaning,repairs and general expenses 850,000 (296,720) - 553,280 553,280 - 612,343

Electricity and water 854,592 (340,942) - 513,650 513,650 - 596,535

Organogram - restructuring cost 567,000 (27,296) - 539,704 539,704 - -

Rent - Ulundi office - (135,000) 135,000 - - - -

Loss on unauthorised use of petrol cards - - - - 59,933 (59,933) - 121

Internal Audit fees 255,256 (45,256) - 210,000 210,000 - 4,254

Staff Training ------136,075

Deficit for the year - - - - (7,593) (7,593) - | annual report 2017 - 18 report | annual Note : This Statement reflects Transfer Payments received and expenditure incurred thereon. The Transfer payment received from the Department is not sufficient to defray all operating expenditure of the Trust, therefore the Trust utilised its own income as reflected on page 117 to pay for expenses. ingonyama trust board trust board ingonyama 122 ingonyama trust board | annual report 2017 - 18 Transfer payment Revenue Other Servitude compensation/land availability compensation/land agreements/refundServitude of fees legal Transfer Ingonyama from Trust Total Revenue Interest on debtors overdue accounts Interest term on Bank investments and Short Royalty revenue Profit on Profit impairment/disposal of assets revenue rental Net income lining straight including - Leases actualLease income Revenue consolidated unadited detailed statement 2018 fortheyearended31march performance offinancial 11 &35 Notes 145,097,390 92,780,201 92,780,201 51,523,032 15,247,425 2018 28,720,458 28,720,458 64,059,743 19,727,000 15,387,415 15,387,415 R 750,694 410,498 794,157 794,157 -

149,540,919 109,088,487 14,736,946 39,530,008 2017 18,788,000 33,563,815 75,524,672 1,772,637 2,921,077 R 990,876 922,424 320,472

consolidated unadited detailed statement of financial performance for the year ended 31 march 2018

Notes R R 2018 2017

Total Expenditure 81,878,853 50,753,190

Agricultural Project expenses 453,820 4,291,646

Advertisements 327,754 398,412

Audit fees 1,117,034 760,460

current - -

previous year 1,117,034 760,460

Internal audit committee members' fees 52,347 9,379

Bank charges 64,943 64,963

Board members' fees ( excluding travel re-imbursement) 29 4,160,522 2,639,182 123

Cleaning repairs & general expenses 1,216,063 978,822

Computer software 325,149 186,620

Depreciation/amortisation 24 3,113,207 3,517,212

Audit fees- internal 210,000 4,254

Insurance 626,978 526,164 | annual report 2017 - 18 report | annual Legal fees 5,208,876 1,528,287

Maintenance of land tenure information system 41,161 31,767

Motor vehicle expenses 322,070 275,270

Stationery and printing 644,604 630,070 ingonyama trust board trust board ingonyama 124 ingonyama trust board | annual report 2017 - 18 Available funds transferred to Accumulated Fund to Accumulated transferred funds Available Loss use unauthorised on of petrol cards Loss disposal on of assets Audit of infrastructure IT assets tenureLand upgrade and formalisation of settlements Rent office -Ulundi ITB Transfer of to funds Ingonyama Trust Board -FundaBursaries Zulu expenses Human resources and communication Workshops and roadshows expenses Security Telephone costs restructuring - Organogram travel) Travelling,accommodation expenses (including and members meeting Board training Staff Increase in provision for debts doubtful and identification management plan/landLand audits Rates and municipalaccommodation charges -office Secretariat administrationSecretariat fees consolidated unadited detailed statement 2018 fortheyearended31march performance offinancial Notes 63,218,537 21,969,634 16,160,410 16,160,410 15,387,415 15,387,415 2018 2,692,277 2,692,277 1,034,097 3,421,039 3,421,039 R 234,048 234,048 399,821 539,704 708,796 225,792 513,650 591,768 43,230 43,230 59,933 12,711 - - 98,787,729 21,767,920 2017 2,921,077 2,691,248 3,358,161 1,675,013 R 330,000 330,000 108,000 292,658 292,658 596,535 596,535 214,563 631,905 136,075 187,527 - - - - -

consolidated unadited detailed statement of financial performance for the year ended 31 march 2018

Notes R R NOTES 2018 2017 Secretariat administration fees 21,969,634 21,767,920

Rates and municipal charges - office accommodation 513,650 596,535

Land identification and management plan/land audits 591,768 292,658

Increase in provision for doubtful debts 16,160,410 1,675,013

Staff training - 136,075

Travelling,accommodation and meeting expenses (including Board members 3,421,039 2,691,248 travel) Organogram - restructuring costs 539,704 -

Telephone 225,792 214,563

Security expenses 708,796 631,905 125 Workshops and roadshows 2,692,277 3,358,161

Human resources and communication expenses 234,048 187,527

Bursaries - Funda Zulu 12,711 330,000

Transfer of funds to Ingonyama Trust Board 15,387,415 2,921,077

Rent - Ulundi ITB office - 108,000

Land tenure upgrade and formalisation of settlements 1,034,097 - 2017 - 18 report | annual

Audit of IT infrastructure assets 399,821 -

Loss on disposal of assets 43,230 -

Loss on unauthorised use of petrol cards 59,933 -

Available funds transferred to Accumulated Fund 63,218,537 98,787,729 trust board ingonyama 126 ingonyama trust board | annual report 2017 - 18 consolidated unadited detailed statement 2018 fortheyearended31march performance offinancial NOTES consolidated unadited detailed statement of financial performance for the year ended 31 march 2018 NOTES

127 | annual report 2017 - 18 report | annual ingonyama trust board trust board ingonyama 128 ingonyama trust board | annual report 2017 - 18 consolidated unadited detailed statement 2018 fortheyearended31march performance offinancial IN G ONYA M A TRUST B A TRUST IS B N : 978-0-621-46777-2 : N RP :375/2018RP OARD : ANNUAL REPORT 2017/208 REPORT :ANNUAL OARD