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SENTECH Integrated Annual Report 2016/17

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SENTECH Integrated Annual Report 2016/17 SENTECH Integrated Annual Report 2016/17 CONTENTS ABBREVIATIONS ...................................................................................................................................................................2 ABOUT THIS REPORT ...........................................................................................................................................................4 Basis of Preparation ..........................................................................................................................................................................4 Report Scope and Boundaries ........................................................................................................................................................4 Determination of Report Content ...................................................................................................................................................4 Combined Assurance .......................................................................................................................................................................4 Forward-looking Statements ..........................................................................................................................................................5 Statement of Responsibility .............................................................................................................................................................5 1 ABOUT SENTECH ..............................................................................................................................................................9 1.1 Evolution of SENTECH ..............................................................................................................................................................9 1.2 Ownership ...................................................................................................................................................................................9 1.3 Legislative Framework ...............................................................................................................................................................9 1.4 Legal and Operating Structure ..................................................................................................................................................9 1.5 Vision, Mission and Corporate Values ......................................................................................................................................11 1.6 Products and Services ................................................................................................................................................................12 1.7 Organisational Structure ............................................................................................................................................................12 1.8 Stakeholder Relationships Management..................................................................................................................................18 2 STRATEGIC REVIEW ..........................................................................................................................................................22 2.1 Chairman’s Report ......................................................................................................................................................................22 2.2 Chief Executive Officer’s Report ................................................................................................................................................24 2.3 Operating Environment .............................................................................................................................................................26 2.4 Business Strategy ........................................................................................................................................................................27 2.5 Operating Model ........................................................................................................................................................................28 2.6 Strategic Risk Profile ...................................................................................................................................................................28 3 OPERATIONAL PERFORMANCE ......................................................................................................................................32 3.1 Chief Financial Officer’s Report for the Year Ended 31 March 2017 .......................................................................................32 3.2 Key Strategic Objectives Outlined in the Shareholder’s Compact ........................................................................................35 3.3 Product and Network Performance ..........................................................................................................................................36 3.4 Key Projects .................................................................................................................................................................................40 4 VALUE CREATED BY CAPITAL EMPLOYED ......................................................................................................................43 4.1 Financial Capital .........................................................................................................................................................................43 4.2 Manufactured Capital .................................................................................................................................................................45 4.3 Social and Relationship Capital .................................................................................................................................................45 4.4. Human Capital ...........................................................................................................................................................................48 4.5 Intellectual Capital ......................................................................................................................................................................52 4.6 Natural Capital ............................................................................................................................................................................53 5 CORPORATE GOVERNANCE ............................................................................................................................................56 5.1 Commitment to Good Governance ..........................................................................................................................................56 5.2 Board of Directors ......................................................................................................................................................................56 5.3 Board Sub-committees ..............................................................................................................................................................56 5.4 Board Continuity Programme ....................................................................................................................................................57 5.5 Approach to Compliance ...........................................................................................................................................................57 5.6 Leadership through Ethics .........................................................................................................................................................58 5.7 Internal Audit .............................................................................................................................................................................58 5.8 ICT Governance ..........................................................................................................................................................................59 5.9 Combined Assurance .................................................................................................................................................................59 6 GROUP ANNUAL FINANCIAL STATEMENTS ...................................................................................................................61 SENTECH Integrated Annual Report 2016/17 1 ABBREVIATIONS AG Auditor-General of South Africa ARC Audit and Risk Committee ASB Accounting Standards Board ASO Analogue Switch Off ATV Analogue TV B-BBEE Broad-Based Black Economic Empowerment BC Business Continuity BTV Business television C&MS Content and Multimedia Services CAPEX Capital Expenditure CEO Chief Executive Officer CFO Chief Financial Officer CICP Companies and Intellectuals Property Commission COO Chief Operations Officer CS Connectivity Services CSI Corporate Social Investment CWU Communication Workers Union DPSA Department of Public Service and Administration DTT Digital Terrestrial Television DTH-S Direct-to-Home Satellite Platform DR Disaster Recover DTPS Department of Telecommunications and Postal Services EA Enterprise architecture EBIT Earnings before interest and taxes ECA Electronic Communications Act (No. 36 of 2005) EE Employment equity EIA Environmental Impact Assessment
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