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royal household
Department: Royal Household PROVINCE OF KWAZULU-NATAL
ANNUAL REPORT 2012/2013
KZN DEPARTMENT OF THE ROYAL HOUSEHOLD
PRIVATE BAG X5023, NONGOMA, 3950
TEL: 035 8310300
FAX: 035 8310428
PR: 225/2013
ISBN: 976-0-621-42080-7
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
FOREWORD
Bayede! Hlanga lweZwe!
KwaZulu-Natal is the home to some of the founding fathers of the ANC, such as Dr John
Langalibalele Dube, PixleykaIsaka Seme, Josiah Gumede, Inkosi Albert Luthuli and the
President of the Republic, the honourable Jacob Zuma. Our history is unequivocal about the
role of the various senior members of the Royal Family in the wars against racial oppression
and their association with the noble ideals that inspired the formation of the ANC.
More than a hundred years later, our Monarchy continues to guide and inspire our political
leadership as we confront the challenges of modern times in an evolving Constitutional
Democracy such as ours. KwaZulu-Natal has, through legislation, ensured that the
institution of monarchy is preserved and plays a critical role in the improvement of the lives
of all the people in this Province.
The rich cultural heritage that we as a Province have inherited from the founders of the Zulu
Kingdom remains a pillar of one of our key economic strengths – tourism – which His
Majesty does so much to promote both locally and internationally. The Royal Household
has a catalytic effect on the promotion of tourism and building unity, thus creating social
conditions conducive to enhancing the economic growth and prosperity of our Province. We
note especially His Majesty’s role in diffusing the resurgence of political tensions during the
politically volatile times experienced in KZN.
We appreciate the role of ISilo in the promotion of human values, the fight against social ills,
the fight against HIV & AIDS, teenage pregnancy, crime and drugs. In many public
addresses ISilo has spoken out in support of the fight against rhino poaching and the
promotion of conservation of our environmental heritage. During the period of tenure of the
current administration, we appreciate the support by ISilo of Government programmes and
policies, especially with regard to cultural issues such as reviving male circumcision in a
surgical and hygienic manner and in promoting the Province locally and internationally.
We take this opportunity to congratulate His Majesty for being awarded the Order of St
Michael and All Angels by the Anglican Church. The Order is the highest recognition
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
awarded by the Diocese of Zululand to lay persons who have rendered outstanding service
to the church and community.
We acknowledge the efforts of His Majesty in linking up with traditional leadership from
other African countries and we remain assured that with his support, this Province will
continue on its noble path towards a brighter and prosperous future.
Hlanga LoMhlabathi!
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
TABLE OF CONTENTS
Page
Organisational chart
04
Part 1
Section 1 Strategic Vision 06-09
Section 2 Report of the Executive Authority 10
Part 2
Section 1 Submission of the Annual Report by the Accounting Officer 12
Section 2 Programme Information 13-16
Part 3
Report of the Audit and Risk Committee 18-20
Part 4
Annual Financial Statements 23-86
Part 5
Human Resources 88-102
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ORGANISATIONAL CHART
Office of the HOD
HR Management
Policies
Staffing Services
Labour Relations
Farming and Housekeeping
Farming Services
Housekeeping Services
Financial Management
Financial Services
Payments Control
Budget Planning
Information Technology & Risk
Management
Procurement and Auxiliary Services
Procurement
Auxiliary Services
Policy Research and Development
Kings Support Services
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
PART 1
SECTION 1: STRATEGIC VISION SECTION 2: REPORT OF THE EXECUTIVE AUTHORITY
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
STRATEGIC VISION
Overview of the service delivery environment for 2012/13
His Majesty has remained true to the commitment to avail the assistance of the Royal
Family in the promotion of the programmes of the Government. We are indebted to all the
Queens for their tireless efforts in this regard. Their embracing of our various initiatives has
enhanced the quality of our work as we strive to improve the lives of the people in KwaZulu-
Natal.
The positive impact of the Monarchy’s intervention in the betterment of the lives of our people can be seen in the following:-
The enthusiastic response to the King’s call for the re-introduction of the custom of male circumcision in the fight against HIV & Aids.
There are more than 105 000 males already circumcised.
ISilo always emphasises that circumcision is not a cure against HIV and AIDS and confers no immune status.
The King has been effective in conveying messages on healthy lifestyles, early regular check-ups and warned against diseases of lifestyle e.g. diabetes, cancers of uterus, breast and prostrate.
ISilo has called on men to support affected female partners and for females to be open about these diseases.
ISilo has persistently acted as:
The champion of peace, reconciliation and unity of all our people, and advising strongly against the destruction of statues and symbols of past governments and leaders and calling for these to be embraced as our common heritages;
An advocate for socio-economic development, including the provision of infrastructure such as roads, water, electricity, etc;
Promoter for the creation of sustainable livelihoods with people being an integral part of the fight to the eradication of poverty, talking strongly against dependence and indolence;
The champion for the building of schools and the provision of quality education;
A strong ally in the fight against crime;
A campaigner against corruption especially by those entrusted with high government official responsibility;
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
An advocate for socially responsible conduct, speaking strongly against drunkenness and substance abuse;
A tireless campaigner for the respect of women’s rights and their emancipation, fighting against domestic violence and the abuse of women; and
A champion for the provision of support and protection of orphans and vulnerable groups in society, an aspect that the entire Royal Family is playing a significant role in the nearby and remote communities.
During 2012/13 His Majesty the King also undertook the following:
Participated in government events and ceremonies, such as the opening of the KZN Provincial Legislature, official opening of the KZN House of Traditional Leaders, and many other events organised by various departments.
Hosted major traditional events such as the Reed Dance, First Fruits and Amaganu ceremonies.
Hosted a number of dignitaries from other countries, such as the Israel Ambassador and prominent business people such as a delegation from Singapore, as a business ambassador to KZN.
Installed Amakhosi both statutorily and customarily.
Was involved in farming activities, such as crop and animal production.
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
Aim of vote
The aim of the vote is to provide administrative support and strategic direction to His Majesty the King and the Royal Household in the execution of their statutory and customary functions in synergistic partnership with the provincial government of KZN.
Mission statement
The mission of the Department of the Royal Household is:
To create a sustainable, conducive environment for the Zulu Monarch in which to lead, develop and protect the Zulu Nation.
Strategic objectives in support of the mission statement
To identify His Majesty the King’s mandatory responsibilities in terms of legislation
To identify His Majesty the King’s mandatory responsibilities in terms of custom/tradition
To generate a schedule of events and ceremonies
To prepare an operational budget for His Majesty the King’s activities
To maintain and refurbish the Royal Palaces
To develop and implement a business strategy for the protection and promotion of Nguni cattle
To promote food production and agri-business
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
Legislative mandates
The Traditional Leadership and Governance Framework Act (Act No. 41 of 2003)
The Royal Household protocols
The roles and functions of His Majesty the King in terms of custom and tradition
The roles and functions of His Majesty the King in terms of the provisions of the
Traditional Leadership and Governance Act (Act No. 5 of 2005)
Public Finance Management Act (Act No. 1 of 1999 as amended), and Treasury
Regulations
Employment Equity Act (Act No. 55 of 1998)
Skills Development Act (Act no. 97 of 1998)
Labour Relations Act (Act No. 66 of 1995)
Conditions of Remuneration of Public Office Bearers.
Public Service Act, No. 103 of 1994, as amended, and Public Service
Regulations of 2001
Policy documents in respect of the salary, benefits and privileges for His Majesty
the King
Custom and tradition (in respect of His Majesty the King’s responsibilities to
vulnerable groups)
Specific Cabinet Resolutions and instructions on the future of His Majesty the
King’s Farms
Preferential Procurement Policy Framework Act (Act No. 5 of 2000)
KZN Provincial SCM Policy Framework, 2006
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
PART 1: SECTION 2
REPORT OF THE EXECUTIVE AUTHORITY
I am pleased to submit the 2012/13 Annual Report of the Department of the Royal
Household. This Annual Report accounts on key milestones and critical activities of the
department executed in terms of mandates such as the Traditional Leadership and
Governance Act, No. 41 of 2003 and The KwaZulu-Natal Traditional Leadership and
Governance Act, No. 5 of 2005.
In the 2012/13 financial year, the Department gave full support on the operations of the
Royal Trust, and an amount of R10,5-million was transferred. The Royal Trust was listed
as a Schedule 3C public entity during 2012/13 and although agreement was reached in
2012/13 on functions to be performed by the Department and the Royal Trust, the latter
was not yet fully operational. This was due to the fact that staff negotiations were not
concluded in 2012/13 as was anticipated, largely as a result of a lack of
managerial/supervisory capacity in the Royal Trust to oversee the staff who are employed
to support the Department. These staff are still managed and paid by the Department,
pending the finalization of the post establishment structure and job evaluation of posts.
During the transition period, while the Royal Trust engaged itself with the development of
policies, systems and procedures to ensure that adequate financial management and
human resource management controls are in place, the Department continued with its
routine activities such as administrative support to His Majesty the King, maintenance of
palaces and farming activities.
I wish to thank His Majesty the King and esteemed members of the Royal Family for the leadership, support and direction provided to the government and the people of KwaZulu Natal.
DDR ZL Mkhize
EExecutive Authority
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
SECTION 1: SUBMISSION OF THE ANNUAL REPORT
BY THE ACCOUNTING OFFICER SECTION 2: PROGRAMME INFORMATION
PART 2
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
PART 2: SECTION 1
SUBMISSION OF THE ANNUAL REPORT BY THE ACCOUNTING OFFICER
It is with great honour that I submit to the Executive Authority, The Honourable
Dr.Z.L.Mkhize, Premier of KwaZulu Natal, this, the Annual Report on the activities and
operations of the Department of the Royal Household, in terms of the Public Finance
Management Act of 1999, for the year ended 31 March 2013.
Mr NVE Ngidi
Acting Accounting Officer
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
PART 2: SECTION 2
PROGRAMME INFORMATION
1. Summary of programmes
Programme 1: Support services – His Majesty the King
Programme 2: Royal Household Planning and Development
Programme 3: His Majesty the King’s Farms
2. Programme performance
2.1 Voted Funds
Programme
Adjusted
Appropriation
Final
Appropriation
Actual
Amount
Spent
Under
Expenditure
R’000 R’000 R’000 R’000
Programme 1:
Support services –
His Majesty the King
35,421 35,421 34,421 1,000
Programme 2:
Royal Household
Planning and
Development
26,085 26,085 24,393 1,692
Programme 3:
His Majesty the
King’s Farms
3,855 3,855 2,553 1,302
Total 65,361 65,361 61,367 3,994
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
2.2. Service Delivery
Programme 1: Support services – His Majesty the King
Purpose
The purpose of this programme is to provide administrative and auxiliary services to His
Majesty the King and the Royal Family. It is charged with the responsibility to ensure that
His Majesty the King and the Royal Family execute the mandate as provided for in the
legislation. It is also responsible for the development and protection of the Monarchy as a
provincial brand. The programme is supported by sub-components as shown in the
department’s design structure. Additional activities towards the transformation of the
Department in terms of Cabinet instructions are included in this programme.
Service delivery achievements (explanations for variances are provided under each measurable objective)
Measurable objective Performance indicator Target Actual Variance
To identify His Majesty the
King’s mandatory
responsibilities in terms of
legislation
Number of Amakhosi
installed statutorily 5 6
1
The number of Amakhosi installed is dependent on the request received from COGTA. The department executed this function as per the requests from COGTA for the current financial year.
To identify His Majesty the
King’s mandatory
responsibilities in terms of
custom/tradition
Number of Amakhosi
installed in terms of
custom
5 10
5
The number of Amakhosi installed is dependent on the request received from COGTA. The department executed this function as per the requests from COGTA for the current financial year.
To generate a schedule of
events and ceremonies
Number of events and
ceremonies 10 14 4
Apart from the regular events/ceremonies held, His Majesty the King also hosted various dignitaries such as the President of South Africa and various MEC’s and Mayors.
To prepare an operational
budget in terms of His
majesty the King’s
activities
Annual Performance
Plan & Strategic Plan 2012/13 completed none
No variance identified.
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
Programme 2: Royal Household Planning and Development
Purpose
This programme is responsible for overall infrastructure design and maintenance. The
core activities include the refurbishment of Palaces.
Service delivery achievements (explanations for variances are provided under each measurable objective)
Measurable objective Performance indicator Target Actual Variance
To maintain and refurbish
palaces
Number of
maintenance projects 10 33 23
Due to the roll-over of funds from the 2011/12 financial year several capital projects were accordingly rolled-over and completed in the current financial year.
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
Programme 3: His Majesty the King’s Farms Purpose
This programme is responsible for the operation and maintenance of the farms. It has to
ensure commercial viability and customary relevance in terms of the farms being able to
contribute to poverty alleviation and other responsibilities of His Majesty the King in his
role as guardian and protector of the vulnerable.
Service delivery achievements (explanations for variances are provided under each measurable objective)
Measurable objective Performance measure Target Actual Variance
To develop and implement
a business strategy for the
protection and promotion
of Nguni cattle
Number of animals
vaccinated 1,300 1,800 500
His Majesty the King acquired and received as donations in his personal capacity more animals than was anticipated.
To promote food
production and agri-
business
Number of hectares
planted 120 22 (98)
Priority was given to the vaccination of animals and since there was a larger than expected number of animals to vaccinate the department did not have enough budget to plant the required number of crops.
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
PART 3
REPORT OF THE AUDIT AND RISK COMMITTEE
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
REPORT OF THE AUDIT & RISK COMMITTEE ON
VOTE 10 – THE ROYAL HOUSEHOLD
The KwaZulu-Natal Provincial Audit & Risk Committee is pleased to present its report for the
financial year ended 31 March 2013.
Provincial Audit & Risk Committee Members and Attendance
The Provincial Audit and Risk Committee (the PARC) consists of the members listed hereunder.
The PARC is split into three (3) Cluster Audit & Risk Committees (the CARC) which consists of
members of the PARC; is responsible for the Governance & Administration, Social and Economic
Clusters respectively and reporting into the PARC. The Chairman of the PARC is also the
Chairman of the different CARCs and attends all CARC meetings. The CARC and the PARC are
required to meet at least four times and two times respectively in a financial year. During the
financial year ending 31 March 2013, a total of sixteen meetings (16) were held, namely, two (2)
PARC meetings, twelve (12) CARC meetings, and two (2) special meetings. Members attended the
meetings as reflected below:
Surname &
Initial
PARC CARC Special Total no.
of
Meetings
Total no. of
Meetings
Attended
No. of
Meetings
Held
Attended No. of
Meetings
Held
Attended No. of
Meetings
Held
Attended
Ms T Tsautse
(Chairman) 2 2 12 12
# 2 2 16 16
Ms M Mothipe 2 2 4 4* 2 2 8 8
Ms N Jaxa 2 2 4 4* 2 2 8 8
Mr L Mangquku 2 2 4 4* 2 2 8 8
Mr T Boltman 2 2 4 4* 2 2 8 8
Mr F Docrat 2 2 4 4* 2 2 8 8
Mr V Naicker 2 2 4 2* 2 2 8 6
* - 4 Meetings per cluster were held
# - Chairman attends all CARC meetings
Provincial Audit & Risk Committee Responsibility
The Provincial Audit and Risk Committee reports that it complied with its responsibilities arising
from the Public Finance Management Act, No.1 of 1999 (PFMA), Treasury Regulations, including
any other statutory and other regulations. The Provincial Audit and Risk Committee also reports
that it adopted appropriate formal terms of reference as its Provincial Audit and Risk Committee
Charter, regulated its affairs in compliance with this charter and discharged all its responsibilities as
contained therein.
The Effectiveness of Internal Control
The systems of internal control are the responsibility of the department’s management and are
designed to provide effective assurance that assets are safeguarded and that liabilities and working
capital are efficiently managed. In line with the requirements of the PFMA and the principles of the
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
King III Report on Corporate Governance, the Internal Audit Function provides the Provincial Audit
and Risk Committee and the departmental management with assurance that the systems of internal
controls are appropriate and effective. This is achieved by means of the risk management process,
as well as the identification of corrective actions and suggested enhancements to the controls and
processes. From the various reports of the Internal Auditors; and the Report and Management
letter of the Auditor-General on the Annual Financial Statements, it was noted that the systems of
internal control and financial internal controls were not effective and inadequate in certain areas for
the entire year under review as control deficiencies were detected in the following significant areas:
Human Resource Management
Asset Management
Supply Chain Management
Contract Management
Subsistence & Travel allowances
Fleet Management
Information Technology General and Application Controls
Maintenance of Palaces
The quality of “In Year Monitoring” and monthly / quarterly reports submitted in terms of the
Treasury Regulations and the Division of Revenue Act
The Provincial Audit and Risk Committee was satisfied with the content and quality of monthly and
quarterly reports prepared and issued by the Accounting Officer and the department during the year
under review.
Audit of Performance Information The monitoring of the department’s performance is a key function of the executive management of the department. The Provincial Audit & Risk Committee has no direct line of responsibility over the department’s performance. However, the Provincial Audit and Risk Committee is responsible for ensuring, principally through the Internal Audit Function that the systems of performance management, measurement and reporting; as well as the systems of internal control that underpin the performance management framework of the department, remain robust and are reviewed routinely in the internal audit plans. The Committee has accepted the responsibility of ensuring that adequate reporting on performance information is in line with its mandate and charter. The Committee reviewed the reports relating to Performance Information and noted that there was a lack of policies and procedures relating to performance information. Internal Audit Function The Provincial Audit & Risk Committee provides oversight and monitors the activities of the Internal Audit Function. Consequently, the Committee is able to report on the effectiveness and efficiency of the function. The function was effective during the period under review and there were no unjustified restrictions or limitations. The Committee will in the forthcoming year, monitor progress to ensure that the Internal Audit Function continues to add value to the department and achieves its optimal performance.
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
Risk Management Function
Risk Management is a proactive discipline that is intended to provide reasonable assurance that the department will achieve its objectives. During this financial year, the Committee reviewed risk reports of the department on a quarterly basis, with particular focus being on:
- Reviewing the Risk Maturity Gap Analysis Report as compiled and presented by the PIAS to determine if this department has key structures and policies to take over its risk management responsibilities.
The result of this analysis was discussed with the department’s management, and the
department was advised to build its internal risk management capacity through, among
other things, the appointment of a Risk Manager at an appropriate level – i.e. the Risk
Manager should be appointed at level 13 and should report directly to the HOD.
- Reviewing progress report on the implementation of risk mitigation plans. The department
was urged to finalise the outstanding risk mitigation plans and to update its risk register with completed risk mitigations plans and emerging risks.
Other Governance Issues As part of its governance responsibilities, the Committee also monitors the fraud prevention strategies that have been developed and implemented by provincial departments, and these responsibilities include monitoring the implementation of recommendations arising from forensic investigations.
During the period under review, the Committee noted that the department had 1 investigation that
was completed and 2 investigations in progress at year end, all of which were conducted by the
Provincial Treasury’s Internal Audit Function. The department was urged to implement recommendations arising from the completed investigation, and to provide the Internal Audit Function with a detailed list of all other investigations being conducted internally or by other relevant authorities.
Evaluation of Financial Statements
The Provincial Audit and Risk Committee reviewed the Annual Financial Statements of the Department, as well as the Auditor General’s management report together with management’s response thereto. The Provincial Audit and Risk Committee concurs and accepts the Auditor-General’s conclusions on the annual financial statements, and is of the opinion that the audited annual financial statements be accepted and read together with the report of the Auditor-General.
__________________________________________
Chairperson: Provincial Audit & Risk Committee
Date: 31 July 2013
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
PART 4
ANNUAL FINANCIAL STATEMENTS
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
Table of contents
Page
Report of the Accounting Officer 23-27
Report of the Auditor-General 28-31
Appropriation Statement 32-36
Notes to the Appropriation Statement 37-38
Statement of Financial Performance 39
Statement of Financial Position 40
Statement of Changes in Net Assets 41
Cash Flow Statement 42
Accounting Policies 43-50
Notes to the Annual Financial Statements 51-65
Disclosures Notes to the Annual Financial Statements 66-78
Annexures 79-86
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
REPORT OF THE ACCOUNTING OFFICER
For the year ended 31 March 2013
Report by the Accounting Officer to the Executive Authority and the KwaZulu-Natal Provincial
Legislature.
1. General review of the state of financial affairs
Important policy decisions and strategic issues facing the Department
The Department made no changes to the purposes of its programmes and reported on
information on pre-determined objectives.
The sub-programme Royal Trust has been included under Programme1: Support Services – His
Majesty the King to account for the appropriation and the transfer to the Royal Household Trust.
An amount of R 10,500m was transferred to the Royal Household Trust during the course of the
financial year. The Royal Household Trust will account for these funds in their annual financial
statements.
The Department’s budget was under spent in all three Programmes and the overall budget for
Vote 10 achieved a savings of R 3,994 m.
Significant Events
The Royal Trust was listed as a Schedule 3C public entity during 2012/13. Although agreement
was reached in 2012/13 on functions to be performed by the Department and the Royal Trust,
the latter was not yet fully operational. This was due to the fact that staff negotiations were not
concluded in 2012/13 as was anticipated, largely as a result of a lack of managerial/supervisory
capacity in the Royal Trust to oversee the staff who are employed to support the Department.
These staff are still managed and paid by the Department, pending the finalization of the post
establishment structure and job evaluation of posts.
During the transition period, while the Royal Trust engaged itself with the development of
policies, systems and procedures to ensure that adequate financial management and human
resource management controls are in place, the Department continued with its routine activities
such as administrative support to His Majesty the King, maintenance of palaces and farming
activities.
Other key areas have been highlighted under separate headings for ease of reference.
a) His Majesty, the King’s, Farms
It must be noted that, although none of His Majesty the King’s Farms appear to be commercially
viable in terms of the feasibility studies undertaken, the Department continued with subsistence
farming activities. The farming activities undertaken on the farms included animal disease
control, Nguni and Boran breeding, providing and fencing of grazing areas, plant production
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
which include providing inputs, ploughing and planting, harvesting of crops such as beans and
maize, and fencing of arable land.
b) Royal Household Planning and Development
The Royal Palaces are central to His Majesty, the King’s, capacity to carry out his roles and
functions. This entails that each palace has to be maintained to its optimum level of functionality.
Major Projects
The Department continued with the renovation and refurbishment, as well as repairs and
maintenance projects to the Royal residences. These projects included the construction of new
buildings, such as rondavels, a cold-room and a garage at the KwaDlamahlahla and Ingwavuma
palaces, renovations of KwaKhethomthandayo, KwaKhangela and Kwalinduzulu palaces. A
water reticulation system was provided at KwaKhethomthandayo palace and a new generator at
Ondini palace.
Spending Trends
PROGRAMME 1: SUPPORT SERVICES: HIS MAJESTY, THE KING UNDER R 1,000m
The expenditure in this programme was under spent due to savings identified under the
categories goods and services and machinery.
The purpose of this programme is to provide administrative and auxiliary services to His Majesty,
the King, and the Royal Family.
PROGRAMME 2: ROYAL HOUSEHOLD PLANNING & DEVELOPMENT UNDER R 1,692m
The expenditure in this programme was under-spent as certain capital projects are still in
progress.
This programme is responsible for the overall infrastructure, design and maintenance of the
Royal Household, with its core activity being the refurbishment of Palaces.
PROGRAMME 3: HIS MAJESTY THE KING’S FARMS UNDER R 1,302m
The expenditure in this programme was under-spent due the savings achieved under the
category compensation of employees.
This programme is responsible for the operation and maintenance of the farms. It ensures
commercial viability and customary relevance in terms of the farms being able to contribute to
poverty alleviation and other responsibilities of his Majesty the King, in his role as guardian and
protector of the vulnerable.
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
Virements and Shifting of funds
There were no virements or shifting of funds.
Corporate Governance Arrangements
The Department is committed to the principles of sound corporate governance and is aware of
its responsibilities and accountability in this respect.
2. Services rendered by the Department
2.1 List of Services
The services rendered by the Department are outlined in the programmes below:
PROGRAMME 1: SUPPORT SERVICES: HIS MAJESTY, THE KING
The purpose of this programme is to provide administrative and auxiliary services to His Majesty
the King and the Royal Family.
PROGRAMME 2: ROYAL HOUSEHOLD PLANNING AND DEVELOPMENT
This programme is responsible for the overall infrastructure, design and maintenance of the
Royal Household, with its core activity being the refurbishment of Palaces.
PROGRAMME 3: HIS MAJESTY, THE KINGS FARMS
This programme is responsible for the operation and maintenance of the farms. It ensures
commercial viability and customary relevance in terms of the farms being able to contribute to
poverty alleviation and other responsibilities of his Majesty, the King, in his role as guardian and
protector of the vulnerable.
2.2 Tariff policy None
2.3 Free Services
None
2.4 Inventories There were no inventories on hand at year end as these items were consumed upon purchase.
3. Capacity constraints The Department has not filled crucial posts in the Finance and Human Resources components.
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
4. Utilisation of donor funds
None 5. Trading entities and public entities
The Royal Household Trust receives a transfer payment from the Department to fund its operations. 6. Organisations to whom transfer payments have been made Transfer payments were made to the Royal Household Trust as mentioned above. Transfer payments were also made to households for leave gratuities and to the Department of Transport for vehicle licences. 7. Public private partnerships (PPP)
No Public Private Partnerships have been entered into by the Department during the financial
year under review. 8. Corporate governance arrangements
The Department operates in compliance with the Constitution of the Republic of South Africa, the
Public Finance Management Act, 1999 (Act No. 1 of 1999), the Public Service Act and all other
relevant legislation governing its operations.The Department’s management team is committed
to the principles of sound corporate governance and are aware of their responsibilities and
accountability in this respect. 9. Discontinued activities/activities to be discontinued
A task team consisting of the Office of the Premier, Provincial Treasury, the Department of the
Royal Household and the Royal Trust, was appointed in 2012/13 to resolve matters such as the
transfer of staff, performance of duties relating to His Majesty’s Queens, etc., and the transfer of
functions from the Department to the Royal Trust. To date, major milestones achieved by the
task team include agreement between the Department and the Royal Trust on the functions to
be performed by the respective entities and agreement on interim arrangements in respect of
staffing and budget. It must be noted that the roles, responsibilities and functions agreed upon
will then form the basis for further planning currently underway, in respect of staff structures,
staff negotiations and funding requirements. 10. New/proposed activities
The Department will continue to transfer funds to the Royal Trust for operational costs. The Department will also continue with renovations and refurbishments of palaces and will continue to support His Majesty the King’s farming activities such as animal and crop production. His Majesty the King will continue to participate in government ceremonies and events, install Amakhosi, host the First Fruits and Reed Dance ceremonies, among others, and undertake both national and international trips as a business ambassador.
11. Asset management
The minimum requirements for the completion of the asset register and all asset management
reforms and milestones have been complied with.
27
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
12. Inventories
All inventory opening and closing balances, together with movements for the year have been disclosed in Annexure 6 of the annual financial statements.
13. Events after the reporting date
No significant events have occurred after the reporting date.
14. Information on pre-determined objectives
All information on pre-determined objectives was reported on a quarterly basis to Provincial
Treasury. This information was compiled by the department and reviewed by the Chief Financial
Officer prior to submission.
15. SCOPA resolutions None 16. Prior modifications to audit reports None 17. Exemptions and deviations received from the National Treasury The department has applied the exemption as granted by National Treasury and thus where there is uncertainty with regard to ownership of immovable assets these have not been disclosed on the face of the annual financial statements. 18. Interim Financial Statements
Interim financial statements were prepared and submitted to Provincial Treasury for the periods ended 30 September 2012 and 31 December 2012. 19. Other None
20. Approval
The Annual Financial Statements have been approved by the Accounting Officer.
Mr NVE Ngidi
Acting Accounting Officer
Department of the Royal Household
31 May 2013
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
DEPARTMENT OF THE ROYAL HOUSEHOLD
VOTE 10
REPORT OF THE AUDITOR-GENERAL
REPORT OF THE AUDITOR-GENERALTO THE KWAZULU-NATAL PROVINCIAL
LEGISLATURE ON VOTE NO. 10: THE DEPARTMENT OF THE ROYAL
HOUSEHOLD
REPORT ON THE FINANCIAL STATEMENTS
Introduction 1. I have audited the financial statements of the Department of the Royal Household
set out on pages 32 to 78, which comprise the appropriation statement, the statement of financial position as at 31 March 2013, the statement of financial performance, statement of changes in net assets and the cash flow statements for the year then ended, and the notes, comprising a summary of significant
accounting policies and other explanatory information.
Accounting officer’s responsibility for the financial statements 2. The accounting officer is responsible for the preparation of the financial statements
in accordance with the Departmental financial reporting framework prescribed by
National Treasury and the requirements of the Public Finance Management Act of South Africa, 1999 (Act No. 1 of 1999) (PFMA) and Division of Revenue Act of South Africa, 2012 (Act No. 5 of 2012) (DoRA) and for such internal control as the accounting officer determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor-General’s responsibility 3. My responsibility is to express an opinion on the financial statements based on my
audit. I conducted my audit in accordance with the Public Audit Act of South Africa, 2004 (Act No. 25 of 2004) (PAA), the general notice issued in terms thereof and
International Standards on Auditing. Those standards require that I comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
4. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the department’s preparation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the department’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
5. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion.
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
Opinion 6. In my opinion, the financial statements present fairly, in all material respects, the
financial position of the Department of the Royal Household as at 31 March 2013, and its financial performance and cash flows for the year then ended in accordance with the Departmental financial reporting framework prescribed by the National
Treasury and the requirements of the PFMA and DoRA.
Additional matters 7. I draw attention to the matters below. My opinion is not modified in respect of these
matters.
Unaudited supplementary schedules
8. The supplementary information set out on pages 79 to 86 does not form part of the financial statements and is presented as additional information. I have not audited these schedules and, accordingly, I do not express an opinion thereon.
Financial Reporting Framework
9. The financial reporting framework prescribed by the National Treasury and applied by the department is a compliance framework. The wording of my opinion on a compliance framework should reflect that the financial statements have been prepared in accordance with this framework and not that they “present fairly”. Section 20(2)(a) of the PAA, however, requires me to express an opinion on the fair presentation of the financial statements. The wording of my opinion therefore reflects this requirement.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
10. In accordance with the PAA and the general notice issued in terms thereof, I report
the following findings relevant to performance against predetermined objectives, compliance with laws and regulations and internal control, but not for the purpose of expressing an opinion.
Predetermined objectives
11. I performed procedures to obtain evidence about the usefulness and reliability of the information in the annual performance report as set out on pages 14 to16 of the annual report.
12. The reported performance against predetermined objectives was evaluated against the overall criteria of usefulness and reliability. The usefulness of information in the annual performance report relates to whether it is presented in accordance with the National Treasury’s annual reporting principles and whether the reported performance is consistent with the planned objectives. The usefulness of information further relates to whether indicators and targets are measurable (i.e. well defined, verifiable, specific, measurable and time bound) and relevant as required by the National Treasury Framework for managing programme performance information.
The reliability of the information in respect of the selected programmes is assessed
to determine whether it adequately reflects the facts (i.e. whether it is valid,
accurate and complete).
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
13. There were no material findings on the annual performance report concerning the
usefulness and reliability of the information.
Additional matter
14. Although no material findings concerning the usefulness and reliability of the performance information were identified in the annual performance report, I draw attention to the following matter below.
Material adjustments to the annual performance report
15. Material misstatements in the annual performance report were identified during the audit, all of which were corrected by management.
Compliance with laws and regulations
16. I performed procedures to obtain evidence that the department has complied with applicable laws and regulations regarding financial matters, financial management and other related matters. My findings on material non-compliance with specific matters in key applicable laws and regulations as set out in the general notice
issued in terms of the PAA are as follows:
Annual financial statements
17. The financial statements submitted for auditing were not prepared in accordance with the prescribed financial reporting framework as required by section 40(1)(a) and (b) of the PFMA . Material misstatements of disclosure items identified by the auditors in the submitted financial statements were subsequently corrected.
Expenditure management
18. The accounting officer did not take effective steps to prevent irregular expenditure, as required by section 38(1)(c)(ii) of the PFMA and Treasury Regulation (TR) 9.1.1.
Procurement and contract management
19. Goods and services with a transaction value below R500 000 were procured without obtaining the required price quotations, as required by TR 16A6.1.
20. Quotations were awarded to suppliers whose tax matters had not been declared by the South African Revenue Services (SARS) to be in order as required by TR 16A9.1 (d) and the Preferential Procurement Regulations (PPR).
21. Contracts and quotations were awarded to bidders who did not submit a declaration on whether they are employed by the state or connected to any person employed by the state, which is prescribed in order to comply with TR 16A8.3.
22. Contracts were awarded to bidders who did not submit a declaration of past supply chain practices such as fraud, abuse of supply chain management (SCM) system and non-performance, which is prescribed in order to comply with TR 16A9.2.
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
Internal control 23. I considered internal control relevant to my audit of the financial statements, annual
performance report and compliance with laws and regulations. The matters reported below under the fundamentals of internal control are limited to the significant deficiencies that resulted in the findings on compliance with laws and regulations included in this report.
Leadership
24. The vacancies in key posts for the year under review negatively impacted on the oversight and monitoring functions that are the responsibility of leadership and management. Leadership has been ineffective in holding management accountable for the credibility of the information and reports provided for oversight and decision-making.
Financial and performance management
25. The monitoring of compliance with laws and regulations, as well as the implementation and application of departmental policies and procedures was ineffective during the year under review.
OTHER REPORTS
Investigations
26. Two investigations are in progress relating to abuse/fraudulent use of petrol cards by staff members and department officials that are trading with the department.
Pietermaritzburg
31 July 2013
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
APPROPRIATION STATEMENT
For the year ended 31 March 2013
32
Details per programme
Appropriation per programme
2012/13 2011/12
Adjusted
Appropriation
Shifting of
Funds
Virement
Final
Appropriation
Actual
Expenditure
Variance
Expenditure
as % of
final
appropriation
Final
Appropriation
Actual
Expenditure
R'000 R'000 R'000 R'000 R'000 R'000 % R'000 R'000
1. Support services: His Majesty The King
Current payment 21,574 - - 21,574 21,231 343 98.4% 20,898 27,551
Transfers and subsidies 10,858 - - 10,858 10,800 58 99.5% 12,130 11,392
Payment for capital assets 1,189 - - 1,189 590 599 49.6% 680 505
Payment for financial assets 1.800 - - 1,800 1,800 - 100% 3,767 3,767
2. Royal Household Planning and
Development
Current payment 9,661 - - 9,661 11,339 (1,678) 117.4% 10,586 11,677
Transfers and subsidies 183 - - 183 253 (70) 138.3% 73 132
Payment for capital assets 16,241 - - 16,241 12,801 3,440 78.8% 8,970 2,527
3. His Majesty The King’s Farms
Current payment 3,775 - - 3,775 2,304 1,471 61.0% 3,524 1,858
Transfers and subsidies 80 - - 80 81 (1) 101.3% 15 -
Payment for capital assets - - - - - - - - -
Payment for financial assets - - - - 168 (168) - - -
TOTAL 65,361 - - 65,361 61,367 3,994 93.9% 60,643 59,409
Reconciliation with Statement of Financial Performance
Add:
Departmental receipts 99 154
Actual amounts per Statements of Financial Performance (Total revenue) 65,460 60,797
Actual amounts per Statements of Financial Performance (Total expenditure) 61,367 59,409
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
APPROPRIATION STATEMENT
For the year ended 31 March 2013
33
Details per Economic classification
Adjusted
Appropriation
Shifting of
Funds
Virement
Final
Appropriation
Actual
Expenditure
Variance
Expenditure
as % of final
appropriation
Final
Appropriation
Actual
expenditure
R'000 R'000 R'000 R'000 R'000 R'000 % R'000 R'000
Current payments
Compensation of employees 21,264 - - 21,264 21,394 (130) 100.6% 21,358 20,093
Goods and services 13,746 - - 13,746 15,516 230 98.3% 13,650 20,993 Transfers and subsidies
Departmental agencies and accounts 10,800 - - 10,800 10,500 300 97.2% 12,000 11,300 Provinces and municipalities 8 - - 8 28 (20) 350.0% 7 - Households 313 - - 313 606 (293) 193.6% 211 224
Payment for capital assets Buildings and other fixed structures 16,204 - - 16,204 12,738 3,466 78.6% 8,782 2,527
Machinery and equipment 1,226 - - 1,226 617 609 50.3% 868 505 Biological assets - - - - - - - - -
Payment for financial assets 1,800 - - 1,800 1,968 (168) 109.3% 3,767 3,767
Total 65,361 - - 65,361 61,367 3,994 93.9% 60,643 59,409
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
Detail per programme 1- Support Services: His Majesty the King
For the year ended 31 March 2013
34
Details per Sub-programme
2012/13 2011/12
Adjusted
Appropriation
Shifting of
Funds
Virement
Final
Appropriation
Actual
Expenditure
Variance
Expenditure
as % of final
appropriation
Final
Appropriation
Actual
expenditure
R'000 R'000 R'000 R'000 R'000 R'000 % R'000 R'000
King’s office Support Services
Current payments 21,574 - - 21,574 21,231 343 98.4% 20,898 27,551 Transfers and subsidies 58 - - 58 300 (242) 517.2% 130 92 Payment for capital assets 1,189 - - 1,189 590 599 49.6% 680 505
Payment for financial assets 1,800 - - 1,800 1,800 - 100.0% 3,767 3,767 Royal Trust
Transfers and subsidies 10,800 - - 10,800 10,500 300 97.2% 12,000 11,300
Total 35,421 - - 35,421 34,421 1000 97.2% 37,475 43,215
Details per Economic classification
2012/13 2011/12
Adjusted
Appropriation
Shifting of
Funds
Virement
Final
Appropriation
Actual
Expenditure
Variance
Expenditure
as % of final
appropriation
Final
Appropriation
Actual
expenditure
R'000 R'000 R'000 R'000 R'000 R'000 % R'000 R'000
Current payments
Compensation of employees 10,132 - - 10,132 10,151 (19) 100.2% 9,801 9,801 Goods and services 11,442 - - 11,442 11,080 362 96.8% 11,097 17,750
Transfers and subsidies
Provinces and municipalities 8 - - 8 28 (20) 350.0% 7 -
Departmental agencies and accounts 10,800 - - 10,800 10,500 300 97.2% 12,000 11,300 Households 50 - - 50 272 (222) 544.0% 123 92
Payment for capital assets
Machinery and equipment 1,189 - - 1,189 590 599 49.6% 680 505
Payment for financial assets 1,800 - - 1,800 1,800 - 100.0% 3,767 3,767
Total 35,421 - - 35,421 35,421 1,000 97.2% 37,475 43,215
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
Detail per programme 2- Royal Household Planning and Development
For the year ended 31 March 2013
35
Details per Sub-Programme
2012/13 2011/12
Adjusted
Appropriation
Shifting of
Funds
Virement
Final
Appropriation
Actual
Expenditure
Variance
Expenditure
as % of final
appropriation
Final
Appropriation
Actual
expenditure
R'000 R'000 R'000 R'000 R'000 R'000 % R'000 R'000
Support Services: His Majesty The King
Current payments 9,661 - - 9,661 11,339 (1,678) 117.4% 10,586 11,677 Transfers and subsidies 183 - - 183 253 (70) 138.3% 73 132
Payment for capital assets 16,241 - - 16,241 12,801 3.440 78.8% 8,970 2,527 Payment for financial assets - - - - - - - - -
Total 26,085 - - 26,085 24,393 1,692 93.5% 19,629 14,336
Details per Economic classification
2012/13 2011/12
Adjusted
Appropriation
Shifting of
Funds
Virement
Final
Appropriation
Actual
Expenditure
Variance
Expenditure
as % of final
appropriation
Final
Appropriation
Actual
expenditure
R'000 R'000 R'000 R'000 R'000 R'000 % R'000 R'000
Current payments
Compensation of employees 8,471 - - 8,471 9,816 (1,345) 115.9% 9,109 9,102 Goods and services 1,190 - - 1,190 1,559 (369) 131.0% 1,477 2,575
Transfers and subsidies
Households 183 - - 183 253 (70) 138.3% 73 132
Payment for capital assets
Buildings and other fixed structures
16,204 - - 16,204 12,738 3,466 78.6% 8,782 2,527
Machinery and equipment 37 - - 37 27 10 73.0% 188 - Payment for financial assets - - - - - - - - -
Total 26,085 - - 26,085 24,393 1,692 93.5% 19,629 14,336
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
Detail per programme 3- His Majesty the King’s Farms
For the year ended 31 March 2013
36
Details per sub programme
2012/13 2011/12
Adjusted
Appropriation
Shifting
of Funds
Virement
Final
Appropriation
Actual
Expenditure
Variance
Expenditure
as % of final
appropriation
Final
Appropriation
Actual
expenditure
R'000 R'000 R'000 R'000 R'000 R'000 % R'000 R'000
His Majesty The King’s Farms Current payments 3,775 - - 3,775 2,304 1,471 61.0% 3,524 1,858
Transfers and subsidies 80 - - 80 81 (1) 101.3% 15 - Payment for financial assets - - - - 168 (168) - - -
Total 3,855 - - 3,855 2,553 1,302 66.2% 3,539 1,858
Details per Economic classification
2012/13 2011/12
Adjusted
Appropriation
Shifting
of Funds
Virement
Final
Appropriation
Actual
Expenditure
Variance
Expenditure
as % of final
appropriation
Final
Appropriation
Actual
expenditure
R'000 R'000 R'000 R'000 R'000 R'000 % R'000 R'000
Current payments
Compensation of employees 2,661 - - 2,661 1,427 1,234 53.6% 2,448 1,190 Goods and services 1,114 - - 1,114 877 237 78.7% 1,076 668
Transfers and subsidies
Households 80 - - 80 81 (1) 101.3% 15 -
Payment for financial assets - - - - 168 (168) - - -
Total 3,855 - - 3,855 2,553 1,302 66.2% 3,539 1,858
-
37
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
NOTES TO THE APPROPRIATION STATEMENT
For the year ended 31 March 2013
1. Detail of transfers and subsidies as per Appropriation Act (after Virement):
Details of these transactions can be viewed in note 6 (Transfers and subsidies) and
annexures 1A and 1B to the Annual Financial Statements.
2. Detail of specifically and exclusively appropriated amounts voted (after
Virement):
Details of these transactions can be viewed in note 1 (Annual Appropriation) to the
Annual Financial Statements.
3. Detail on payments for financial assets
Details of these transactions per category can be viewed in the note Payments for
financial assets to the Annual Financial Statements.
4. Explanations of material variances from Amounts Voted (after Virement):
3.1 Per Programme
Final
Appropriation
Actual
Expenditure
Variance Variance as a
% of Final
Appropriation R’000 R’000 R’000
Programme 1:
Support services: His Majesty
the King
35,421 34,421 1,000 2.82
The spending in Programme 1 was in line with the budget.
Programme 2:
Royal Household: Planning &
Development
26,085 24,393 1,692 6.49
Savings in Programme 2 were identified under the category Buildings and other fixed structures as
certain capital projects are still in progress.
Programme 3:
His Majesty The King’s Farms 3,855 2,553 1,302 33.77
Savings in Programme 3 occurred in the category Compensation of employees.
38
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
DEPARTMENT OF THE ROYAL HOUSEHOLD
VOTE 10
NOTES TO THE APPROPRIATION STATEMENT For the year ended 31 March 2013
3.2 Per Economic classification
Final
Appropriation
Actual
Expenditure
Variance Variance as a
% of Final
Appropriation R’000 R’000 R’000
Current payment:
Compensation of employees 21,264 21,394 (130) (0.61)
Goods and services 13,746 13,516 230 1.67
Transfers and subsidies:
Provinces and municipalities 8 28 (20) (250.00)
Departmental agencies and accounts 10,800 10,500 300 2.78
Households 313 606 (293) (93.61)
Payments for capital assets:
Buildings and other fixed structures 16,204 12,738 3,466 21.39
Machinery and equipment 1,226 617 609 49.67
Payments for financial assets 1,800 1,968 (168) (9.33)
EXPLANATION OF MATERIAL VARIANCES
Transfers and subsidies: Households
Overspending realised as a result of leave gratuity payments that were made.
Buildings and other fixed structures
Savings identified as certain capital projects are still in progress.
Machinery and equipment
Savings identified as some vehicles were received before year end but not paid for as at 31 March 2013.
39
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
STATEMENT OF FINANCIAL PERFORMANCE
For the year ended 31 March 2013
2012/13 2011/12
Note R'000 R'000
REVENUE
Annual appropriation 1 65,361 60,643
Departmental revenue 2 99 154
TOTAL REVENUE 65,460 60,797
EXPENDITURE
Current expenditure
Compensation of employees 3 21,394 20,093
Goods and services 4 13,516 20,993
Total current expenditure 34,910 41,086
Transfers and subsidies
Transfers and subsidies 6 11,134 11,524
Total transfers and subsidies 11,134 11,524
Expenditure for capital assets
Tangible capital assets 7 13,355 3,032
Total expenditure for capital assets 13,355 3,032
Payments for financial assets 5 1,968 3,767
TOTAL EXPENDITURE 61,367 59,409
SURPLUS FOR THE YEAR 4,093 1,388
Reconciliation of Net Surplus for the year
Voted Funds 3,994 1,234
Annual appropriation 3,994 1,234
Departmental revenue and NRF Receipts 99 154
SURPLUS FOR THE YEAR 4,093 1,388
40
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
STATEMENT OF FINANCIAL POSITION
For the year ended 31 March 2013
2012/13 2011/12
Note R'000 R'000
ASSETS
Current Assets 16,944 17,367
Unauthorised expenditure 8 11,284 13,084 Receivables 9 5,660 4,283
TOTAL ASSETS 16,944 17,367
LIABILITIES
Current Liabilities 16,944 17,366 Voted funds to be surrendered to the Revenue Fund
10 3,994 6,984
Departmental revenue to be surrendered to the Revenue Fund
11 11 (200)
Bank overdraft 12 12,329 10,004 Payables 13 610 578
TOTAL LIABILITIES 16,944 17,366
NET ASSETS - 1
Represented by: Recoverable revenue - 1
TOTAL - 1
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royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
STATEMENT OF CHANGES IN NET ASSETS
For the year ended 31 March 2013
2012/13 2011/12
R'000 R'000
Recoverable revenue
Opening balance 1 -
Transfers: (1) 1
Irrecoverable amounts written off - -
Debts recovered (included in departmental receipts) (1)
Debts raised - 1
Closing balance
TOTAL - 1
42
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
CASH FLOW STATEMENT
For the year ended 31 March 2013
2012/13 2011/12
Note R'000 R'000
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts 65,460 60,797
Annual appropriated funds received 1 65,361 60,643
Departmental revenue received 2 99 154
Net decrease/(increase) in working capital 455 (3,599)
Surrendered to Revenue Fund (6,872) (264)
Current payments (34,910) (35,346)
Payments for financial assets (1,968) (3,767)
Transfers and subsidies paid (11,134) (11,524)
Net cash flow from operating activities 14 11,031 6,297
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for capital assets 7 (13,355) (3,032)
Net cash flow from investing activities (13,355) (3,032)
CASH FLOWS FROM FINANCING ACTIVITIES
(Decrease)/Increase in net assets (1) 1
Net cash flow from financing activities (1) 1
Net (decrease)/increase in cash and cash equivalents (2,325) 3,266
Bank overdraft at beginning of period (10,004) (13,270)
Bank overdraft at end of period 15 (12,329) (10,004)
43
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
ACCOUNTING POLICIES
For the year ended 31 March 2013
The Financial Statements have been prepared in accordance with the following policies, which
have been applied consistently in all material aspects, unless otherwise indicated. However,
where appropriate and meaningful, additional information has been disclosed to enhance the
usefulness of the Financial Statements and to comply with the statutory requirements of the
Public Finance Management Act, Act 1 of 1999 (as amended by Act 29 of 1999), and the
Treasury Regulations issued in terms of the Act and the Division of Revenue Act, Act 1 of 2010.
1. Presentation of the Financial Statements
1.1.1 Basis of preparation
The Financial Statements have been prepared on a modified cash basis of accounting, except where stated otherwise. The modified cash basis constitutes the cash basis of accounting supplemented with additional disclosure items. Under the cash basis of accounting transactions and other events are recognised when cash is received or paid.
1.2 Presentation currency
All amounts have been presented in the currency of the South African Rand (R) which is also the functional currency of the department.
1.3 Rounding Unless otherwise stated all financial figures have been rounded to the nearest one thousand Rand (R’000).
1.4 Comparative figures Prior period comparative information has been presented in the current year’s financial statements. Where necessary figures included in the prior period financial statements have been reclassified to ensure that the format in which the information is presented is consistent with the format of the current year’s financial statements.
1.5 Comparative figures - Appropriation Statement A comparison between actual amounts and final appropriation per major classification of expenditure is included in the Appropriation Statement.
2. Revenue
2.1 Appropriated funds Appropriated funds comprises of departmental allocations as well as direct charges against revenue fund (i.e. statutory appropriation). Appropriated funds are recognised in the financial records on the date the appropriation becomes effective. Adjustments made in terms of the adjustments budget process are recognised in the financial records on the date the adjustments become effective.
44
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
ACCOUNTING POLICIES
For the year ended 31 March 2013 Unexpended appropriated funds are surrendered to the National/Provincial Revenue Fund. Any amounts owing to the National/Provincial Revenue Fund at the end of the financial year are recognised as payable in the statement of financial position. Any amount due from the National/Provincial Revenue Fund at the end of the financial year is recognised as a receivable in the statement of financial position.
2.2 Departmental revenue All departmental revenue is recognised in the statement of financial performance when received and is subsequently paid into the National/Provincial Revenue Fund, unless stated otherwise. Any amount owing to the National/Provincial Revenue Fund is recognised as a payable in the statement of financial position. No accrual is made for amounts receivable from the last receipt date to the end of the reporting period. These amounts are however disclosed in the disclosure note to the annual financial statements.
2.3 Direct Exchequer receipts All direct exchequer receipts are recognised in the statement of financial performance when the cash is received and is subsequently paid into the National/Provincial Revenue Fund, unless stated otherwise. Any amount owing to the National/Provincial Revenue Funds at the end of the financial year is recognised as a payable in the statement of financial position.
2.4 Direct Exchequer payments All direct exchequer payments are recognised in the statement of financial performance when final authorisation for payment is effected on the system (by no later than 31 March of each year).
2.5 Aid assistance Aids assistance is recognised as revenue when received All in-kind aid assistance is disclosed at fair value on the date of receipt in the annexures to the Annual Financial Statements The cash payments made during the year relating to aid assistance projects are recognised as expenditure in the statement of financial performance when final authorisation for payments is effected on the system (by no later than 31 March of each year) The value of the assistance expensed prior to the receipt of funds is recognised as a receivable in the statement of financial position. Inappropriately expensed amounts using aid assistance and any unutilised amounts are recognised as payables in the statement of financial position.
45
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
DEPARTMENT OF THE ROYAL HOUSEHOLD
VOTE 10
ACCOUNTING POLICIES For the year ended 31 March 2013
All CARA funds received must be recorded as revenue when funds are received. The cash payments made during the year relating to CARA earmarked projects are recognised as expenditure in the statement of financial performance when final authorisation for payments effected on the system (by no later than 31 March of each year) Inappropriately expensed amounts using CARA funds are recognised as payables in the statement of financial position. Any unutilised amounts are transferred to retained funds as they are not surrendered to the revenue fund.
3. Expenditure
3.1 Compensation of employees 3.1.2 Salaries and wages
Salaries and wages are expensed in the statement of financial performance when the final authorisation for payment is effected on the system (by no later than 31 March of each year). Other employee benefits that give rise to a present legal or constructive obligation are disclosed in the disclosure notes to the financial statements at its face value and are not recognised in the statement of financial performance or position. Employee costs are capitalised to the cost of a capital project when an employee spends more than 50% of his/her time on the project. These payments form part of expenditure for capital assets in the statement of financial performance.
3.1.2 Social contributions Employer contributions to post employment benefit plans in respect of current employees are expensed in the statement of financial performance when the final authorisation for payment is effected on the system (by no later than 31 March of each year). No provision is made for retirement benefits in the financial statements of the department. Any potential liabilities are disclosed in the financial statements of the National Revenue Fund and not in the financial statements of the employer department. Employer contributions made by the department for certain of its ex-employees (such as medical benefits) are classified as transfers to households in the statement of financial performance.
3.2 Goods and services Payments made during the year for goods and/or services are recognised as an expense in the statement of financial performance when the final authorisation for payment is effected on the system (by no later than 31 March of each year). The expense is classified as capital if the goods and/or services were acquired for a capital project or if the total purchase price exceeds the capitalisation threshold (currently R5, 000).All other expenditures are classified as current. Rental paid for the use of buildings or other fixed structures is classified as goods and services and not as rent on land.
46
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
DEPARTMENT OF THE ROYAL HOUSEHOLD
VOTE 10
ACCOUNTING POLICIES For the year ended 31 March 2013
3.3 Interest and rent on land
Interest and rental payments are recognised as an expense in the statement of financial performance when the final authorisation for payment is effected on the system (by no later than 31 March of each year). This item excludes rental for the use of buildings or other fixed structures. If it is not possible to distinguish between payment for the use of land and the fixed structures on it, the whole amount should be recorded under goods and services.
3.4 Payments for financial assets Debts are written off when identified as irrecoverable. Debts written-off are limited to the amount of savings and/or under spending of appropriated funds. The write off occurs at year-end or when funds are available. No provision is made for irrecoverable amounts but an estimate is included in the disclosure notes to the financial statements amounts. All other losses are recognised when authorisation has been granted for the recognition thereof.
3.5 Transfers and subsidies Transfers and subsidies are recognised as an expense when the final authorisation for payment is effected on the system (by no later than 31 March of each year).
3.6 Unauthorised expenditure
When confirmed unauthorised expenditure is recognised as an asset in the statement of financial position until such time as the expenditure is either approved by the relevant authority, recovered from the responsible person or written off as irrecoverable in the statement of financial performance. Unauthorised expenditure approved with funding is derecognised from the statement of financial position when the unauthorised expenditure is approved and the related funds are received. Where the amount is approved without funding it is recognised as expenditure in the statement of financial performance on the date of approval.
3.7 Fruitless and wasteful expenditure Fruitless and wasteful expenditure is recognised as expenditure in the statement of financial performance according to the nature of the payment and not as a separate line item on the face of the statement. If the expenditure is recoverable it is treated as an asset until it is recovered from the responsible person or written off as irrecoverable in the statement of financial performance.
3.8 Irregular expenditure Irregular expenditure is recognised as expenditure in the statement of financial performance. If the expenditure is not condoned by the relevant authority it is treated as an asset until it is recovered or written off as irrecoverable.
47
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
ACCOUNTING POLICIES
For the year ended 31 March 2013
4. Assets
4.1 Cash and cash equivalents Cash and cash equivalents are carried in the statement of financial position at cost. Bank overdrafts are shown separately on the face of the statement of financial position. For the purposes of the cash flow statement, cash and cash equivalents comprise cash on hand, deposits held, other short-term highly liquid investments and bank overdrafts.
4.2 Other financial assets Other financial assets are carried in the statement of financial position at cost.
4.3 Prepayments and advances Amounts prepaid or advanced are recognised in the statement of financial position when the payments are made and are derecognised as and when the goods/services are received or the funds are utilised. Prepayments and advances outstanding at the end of the year are carried in the statement of financial position at cost.
4.4 Receivables Receivables included in the statement of financial position arise from cash payments made that are recoverable from another party (including departmental employees) and are derecognised upon recovery or write-off. Receivables outstanding at year-end are carried in the statement of financial position at cost plus any accrued interest. Amounts that are potentials irrecoverable are included in the disclosure notes.
4.5 Investments Capitalised investments are shown at cost in the statement of financial position. Investments are tested for an impairment loss whenever events or changes in circumstances indicate that the investment may be impaired. Any impairment loss is included in the disclosure notes.
4.6 Loans Loans are recognised in the statement of financial position when the cash is paid to the beneficiary. Loans that are outstanding at year-end are carried in the statement of financial position at cost plus accrued interest. Amounts that are potentially irrecoverable are included in the disclosure notes.
48
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
DEPARTMENT OF THE ROYAL HOUSEHOLD
VOTE 10
ACCOUNTING POLICIES For the year ended 31 March 2013
4.7 Inventory
Inventories that qualify for recognition must be initially reflected at cost. Where inventories are acquired at no cost, or for nominal consideration, their cost shall be their fair value at the date of acquisition. All inventory items at year-end are reflected using the weighted average cost or FIFO cost formula.
4.8 Capital assets
4.8.1 Movable assets Initial recognition A capital asset is recorded in the asset register on receipt of the item at cost. Cost of an asset is defined as the total cost of acquisition. Where the cost cannot be determined accurately, the movable capital asset is stated at fair value. Where fair value cannot be determined, the capital asset is included in the asset register at R1. All assets acquired prior to 1 April 2002 are included in the register R1. Subsequent recognition Subsequent expenditure of a capital nature is recorded in the statement of financial performance as “expenditure for capital assets” and is capitalised in the asset register of the department on completion of the project. Repairs and maintenance is expensed as current “goods and services” in the statement of financial performance.
4.8.2 Immovable assets Initial recognition A capital asset is recorded on receipt of the item at cost. Cost of an asset is defined as the total cost of acquisition. Where the cost cannot be determined accurately, the immovable capital asset is stated at R1 unless the fair value for the asset has been reliably estimated. Subsequent recognition Work-in-progress of a capital nature is recorded in the statement of financial performance as “expenditure for capital assets”. On completion, the total cost of the project is included in the asset register of the department that is accountable for the asset. Repairs and maintenance is expensed as current “goods and services” in the statement of financial performance.
5. Liabilities
5.1 Payables Recognised payables mainly comprise of amounts owing to other governmental entities. These payables are carried at cost in the statement of financial position.
49
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
DEPARTMENT OF THE ROYAL HOUSEHOLD
VOTE 10
ACCOUNTING POLICIES For the year ended 31 March 2013
5.2 Contingent liabilities
Contingent liabilities are included in the disclosure notes to the financial statements when it is possible that economic benefits will flow from the department, or when an outflow of economic benefits or service potential is probable but cannot be measured reliably.
5.3 Contingent assets
Contingent assets are included in the disclosure notes to the financial statements when it is probable that an inflow of economic benefits will flow to the entity.
5.4 Commitments Commitments are not recognised in the statement of financial position as a liability or as expenditure in the statement of financial performance but are included in the disclosure notes.
5.5 Accruals Accruals are not recognised in the statement of financial position as a liability or as expenditure in the statement of financial performance but are included in the disclosure notes.
5.6 Employee benefits Short-term employee benefits that give rise to a present legal or constructive obligation are disclosed in the disclosure notes to the financial statements. These amounts are not recognised in the statement of financial performance or the statement of financial position.
5.7 Lease commitments Finance lease Finance leases are not recognised as assets and liabilities in the statement of financial position. Finance lease payments are recognised as an expense in the statement of financial performance and are apportioned between the capital and interest portions. The finance lease liability is disclosed in the disclosure notes to the financial statements. Operating lease Operating lease payments are recognised as an expense in the statement of financial performance. The operating lease commitments are disclosed in the discloser notes to the financial statement.
5.8 Impairment and other provisions The department tests for impairment where there is an indication that a receivable, loan or investment may be impaired. An assessment of whether there is an indication of possible impairment is done at each reporting date. An estimate is made for doubtful loans and receivables based on a review of all outstanding amounts at year-end. Impairments on investments are calculated as being the difference between the carrying amount and the present value of the expected future cash flows / service potential flowing from the instrument.
50
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
DEPARTMENT OF THE ROYAL HOUSEHOLD
VOTE 10
ACCOUNTING POLICIES For the year ended 31 March 2013
Provisions are disclosed when there is a present legal or constructive obligation to forfeit economic benefits as a result of events in the past and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate of the obligation can be made.
6. Receivables for departmental revenue Receivables for departmental revenue are disclosed in the disclosure notes to the annual financial statements.
7. Net Assets
7.1 Capitalisation reserve The capitalisation reserve comprises of financial assets and/or liabilities originating in a prior reporting period but which are recognised in the statement of financial position for the first time in the current reporting period. Amounts are recognised in the capitalisation reserves when identified in the current period and are transferred to the National/Provincial Revenue Fund when the underlining asset is disposed and the related funds are received.
7.2 Recoverable revenue Amounts are recognised as recoverable revenue when a payment made in a previous financial year becomes recoverable from a debtor in the current financial year. Amounts are either transferred to the National/Provincial Revenue Fund when recovered or are transferred to the statement of financial performance when written-off.
8. Related party transactions Specific information with regards to related party transactions is included in the disclosure notes.
9. Key management personnel Compensation paid to key management personnel including their family members where relevant, is included in the disclosure notes.
10. Public private partnerships A description of the PPP arrangement, the contract fees and current and capital expenditure relating to the PPP arrangement is included in the disclosure notes.
51
DEPARTMENT OF THE ROYAL HOUSEHOLD
VOTE 10
NOTES TO THE ANNUAL FINANCIAL STATEMENTS For the year ended 31 March 2013
1. Annual Appropriation
1.1 Annual Appropriation
Included are funds appropriated in terms of the Appropriation Act for National Departments (Voted funds) and Provincial Departments:
Programmes
Final
Appropriation
Actual Funds
Received
Funds not
requested/
not received
Appropriation
received
2011/12
R’000 R’000 R’000 R’000
Support services: His Majesty The King 35,421 35,421 - 37,475
Royal Household Planning & Development 26,085 26,085 - 19,629
His Majesty The King’s Farms 3,855 3,855 - 3,539
Total 65,361 65,361 - 60,643
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
52
2012/13
2011/12
Note R'000
R'000
2 Departmental Revenue
Sales of goods and services other than capital assets 2.1 96
104
Sales of capital assets
2.2 -
-
Transactions in financial assets and liabilities
2.3 3
50
Total revenue collected
99
154
Less: Own revenue included in appropriation
Departmental revenue collected
99
154
2.1 Sales of goods and services other than capital assets
Sales of goods and services produced by the department
96
104
Administrative fees
34
32
Other sales
62
72
Total
96
104
2.2 Sales of capital assets
Tangible assets
-
-
Machinery and equipment
-
-
Total
-
-
2.3 Transactions in financial assets and liabilities
Stale cheques written back
-
50
Other Receipts including Recoverable Revenue
3
-
Total
3
50
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
53
2012/13
2011/12
Note R'000
R'000
3 Compensation of Employees
3.1 Salaries and wages
Basic salary
13,810
12,735
Service based
1,217
1,071
Compensative/circumstantial
972
489
Other non-pensionable allowances
2,937
3,479
Total
18,936
17,774
3.2 Social Contributions
Employer contributions
Pension
1,780
1,683
Medical
670
628
Bargaining council
8
8
Total
2,458
2,319
Total compensation of employees
21,394
20,093
138
142
Average number of employees
138
142
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
54
2012/13
2011/12
Note R'000
R'000
4 Goods and services
Advertising
21
46
Assets less than R5,000
4.1 14
59
Catering
307
120
Communication
929
1,239
Computer services
4.2 107
166
Consultants, contractors and agency/outsourced services 4.3 623
3,595
Entertainment
374
969
Audit cost – external
4.4 1,411
1,909
Inventory
4.5 1,866
3,838
Operating leases
251
260
Owned and leasehold property expenditure
4.6 820
1,083
Travel and subsistence
4.7 4,415
6,070
Training and staff development
-
44
Other operating expenditure
4.8 2,378
1,595
Total
13,516
20,993
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
55
2012/13
2011/12
R'000
R'000
4.1 Assets less than R5,000
Tangible assets
14
59
Machinery and equipment
14
59
Total
14
59
4.2 Computer services
SITA computer services
107
166
Total
107
166
4.3 Consultants, contractors and agency/outsourced services
Business and advisory services
120
1,705
Infrastructure and planning
370
764
Contractors
133
1,126
Total
623
3,595
4.4 Audit cost – external
Regularity audits
1,411
1,909
Total
1,411
1,909
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
56
2012/13
2011/12
R'000
R'000
4.5 Inventory
Food and food supplies
624
1,576
Fuel, oil and gas
27
1,031
Other consumable materials
775
502
Maintenance material
313
212
Stationery and printing
127
517
Total
1,866
3,838
4.6 Owned and leasehold property expenditure
Municipal services
545
859
Property maintenance and repairs
275
224
Total
820
1,083
4.7 Travel and subsistence
Local
4,399
6,053
Foreign
16
17
Total
4,415
6,070
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
57
2012/13
2011/12
Note R'000
R'000
4.8 Other operating expenditure
Resettlement costs
26
-
Other
2,352
1,595
Total
2,378
1,595
5 Payments for financial assets
Other material losses written off 5.1 1,800
3,767
Debts written off 5.2 168
-
Total 1,968
3,767
5.1 Other material losses written off 1,800
3,767
First charge against the vote
1,800
3,767
5.2 Debts written off 168
-
Suspense accounts with old balances 168
-
6 Transfers and Subsidies
Departmental agencies and accounts
10,528
11,300
Households
606
224
Total
11,134
11,524
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
58
2012/13
2011/12
Note R'000
R'000
7 Expenditure for capital assets
Tangible assets
13,355
3,032
Buildings and other fixed structures
12,715
2,527
Machinery and equipment
21.1 640
505
Total
13,355
3,032
7.1 Analysis of funds utilised to acquire capital assets - 2012/13
Voted Funds Aid
assistance
TOTAL
R'000 R'000
R'000
Tangible assets
13,355
13,355
Buildings and other fixed structures
12,715 -
12,715
Machinery and equipment
640 -
640
Total
13,355 -
13,355
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
59
7.2 Analysis of funds utilised to acquire capital assets – 2011/12
Voted Funds
Aid assistance
TOTAL
R'000 R'000
R'000
Tangible assets
3,032 -
3,032
Buildings and other fixed structures
2,527 -
2,527
Machinery and equipment
505 -
505
Total
3,032 -
3,032
2012/13
2011/12
8 Unauthorised Expenditure
Note R'000
R'000
8.1 Reconciliation of unauthorised expenditure
Opening balance
13,084
10,761
Unauthorised expenditure - discovered in the current year -
5,740
Less: First charge against the vote
(1,800)
(3,767)
Add: Adjustment for prior years misallocation
-
350
Unauthorised expenditure awaiting write off
11,284
13,084
Analysis of awaiting write off per economic classification
Current 11,284
13,084
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
60
Analysis of unauthorised expenditure awaiting authorisation per type 2012/13
2011/12
Unauthorised expenditure relating to overspending of the vote or a main division
within the vote 11,284
13,084
Total
11,284
13,084
Details of unauthorised expenditure - current year
Incident Disciplinary steps taken/criminal proceedings
None None -
5,740
Total
-
5,740
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
61
Included in unauthorised expenditure is an amount of R 9,694,000-00, which has been approved by SCOPA without
funding as a first charge against the department’s budget in future years, as follows:
2013/14 financial year - R 2,500,000-00
2014/15 financial year - R 2,500,000-00
2015/16 financial year - R 4,694,000-00
Less than one year
One to three years
Older than three years Total
2011/12
R’000 R’000 R’000 R’000
R’000
9 Receivables
Claims recoverable
9.1 1,569 3,939 110 5,618 4,077
Staff debt
9.2 - 12 - 12 13
Other debtors
9.3 28 2 - 30 193
Total
1,597 3,953 110 5,660
4,283
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
NOTES TO THE ANNUAL FINANCIAL STATEMENTS For the year ended 31 March 2013
62
2012/13
2011/12
Note R'000
R'000
9.1 Claims recoverable
Provincial departments
Annex 4 2,999
1,727
Public entities
Annex 4 2,619
2,350
Total
5,618
4,077
9.2 Staff debt
Less than 1 year
12
12
More than 3 years
-
1
Total
12
13
9.3 Other debtors
Sal: Tax debts
2
31
Sal: Deduction disallowance a/c: CA
-
13
Sal: Reversal control account: CA
-
139
Sal: Medical aid: CL
-
6
Sal: Income tax: CL
-
2
Double payment for queen’s medical expenses
2
2
Gama NN – salary paid after termination
20
-
Mavimbela – salary paid after termination
6
-
Total
30
193
DEPARTMENT OF THE ROYAL HOUSEHOLD
VOTE 10
NOTES TO THE ANNUAL FINANCIAL STATEMENTS For the year ended 31 March 2013
63
2012/13
2011/12
R'000
R'000 10 Voted Funds to be Surrendered to the Revenue Fund
Opening balance
6,984
10
Transfer from statement of financial performance
3,994
1,234
Add: Unauthorised expenditure for current year
-
5,740
Paid during the year
(6,984)
-
Closing balance
3,994
6,984
11 Departmental revenue to be surrendered to the Revenue Fund
Opening balance
(200)
(90)
Refund from Revenue fund
200
-
Transfer from Statement of Financial Performance
99
154
Paid during the year
(88)
(264)
Closing balance
11
(200)
12 Bank Overdraft
Consolidated Paymaster General Account
12,329
10,004
Total
12,329
10,004
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
64
2012/13
2011/12
Note R'000
R'000
13 Payables – current
Amounts owing to other entities
Annex 5 300
300
Clearing accounts
13.1 199
144
Other payables
13.2 111
134
Total
610
578
13.1 Clearing accounts
Sal: ACB recalls:CL
150
123
Pension recoverable account
44
21
Salary reversal control account
5
-
Total
199
144
13.2 Other payables
Unallocated credits
-
28
S&W non pensionable allowances
53
53
Leave gratuity payments
53
53
Over deduction from employee – N Sithole
5
-
Total
111
134
DEPARTMENT OF THE ROYAL HOUSEHOLD
VOTE 10
NOTES TO THE ANNUAL FINANCIAL STATEMENTS For the year ended 31 March 2013
65
2012/13
2011/12
Note R'000
R'000
14 Net cash flow available from operating activities
Net surplus as per Statement of Financial Performance
4,093
1,388
Add back non cash/cash movements not deemed operating activities 6,938
4,909
(Increase) in receivables – current
(1,377)
(1,406)
Decrease in other current assets
1,800
3,417
Increase in payables – current
32
130
Expenditure on capital assets
13,355
3,032
Surrenders to Revenue Fund
(6,872)
(264)
Net cash flow generated by operating activities
11,031
6,297
15 Reconciliation of cash and cash equivalents for cash flow purposes
Consolidated Paymaster General account
(12,329)
(10,004)
Total
(12,329)
(10,004)
DEPARTMENT OF THE ROYAL HOUSEHOLD
VOTE 10
DISCLOSURE NOTES TO THE ANNUAL FINANCIAL STATEMENTS For the year ended 31 March 2013
66
2012/13
2011/12
Note R'000
R'000
16 Contingent liabilities
Liable to
Nature
Other departments Interdepartmental unconfirmed balances Annex 5 1,843
1,378
Total
1,843
1,378
17 Commitments
Current expenditure
2,273
-
Approved and contracted
2,273
-
Capital expenditure
3,010
-
Approved and contracted
3,010
-
Total Commitments
5,283
-
18 Accruals
Listed by economic classification 30 days 30+ days Total
Total
Goods and services
999 484 1,483
673
Capital assets
147 - 147
474
Total 1,146 484 1,630
1,147
Listed by programme level
Programme 1
1,194
596
Programme 2
401
551
Programme 3
35
-
Total
1,630
1,147
DEPARTMENT OF THE ROYAL HOUSEHOLD
VOTE 10
DISCLOSURE NOTES TO THE ANNUAL FINANCIAL STATEMENTS For the year ended 31 March 2013
67
2012/13
2011/12
Note R'000
R'000
Confirmed balances with departments
Annex 5 1,366
300
Total
1,366
300
19 Employee benefits
Leave entitlement
1,462
1,365
Thirteenth cheque
586
536
Capped leave commitments
4,361
4,431
Total
6,409
6,332
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
DISCLOSURE NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
68
20 Lease commitments
20.1 Operating leases expenditure
Land
Buildings and other
fixed structures
Machinery and
equipment
Total 2012/13
R’000
Total 2011/12
R’000
Not later than 1 year - - 28 28
82
Later than 1 year and not later than 5 years - - 19 19
10
Total lease commitments
- - 47 47
92
20.2 Finance leases expenditure **
Land
Buildings and other
fixed structures
Machinery and
equipment
Total 2012/13
R’000
Total 2011/12
R’000
Not later than 1 year
- - 327 327
262
Later than 1 year and not later than 5 years - 96 96
51
Total lease commitments
- - 423 423
313
LESS: finance costs
- - -
-
Total present value of lease liabilities - - 423 423
313
** This note excludes leases relating to public private partnerships.
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
DISCLOSURE NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
69
2012/13
2011/12
R'000
R'000
21 Irregular expenditure
21.1 Reconciliation of irregular expenditure
Opening balance
1,999
-
Add: Irregular expenditure – relating to current year
3,079
1,999
Irregular expenditure awaiting condonation
5,078
1,999
Analysis of awaiting condonation per age classification
Current
3,079
1,999
Prior years
1,999
-
Total
5,078
1,999
Provincial Treasury embarked on an exercise to reconcile the disclosures with the departmental registers and to investigate each case with the
responsible departments.
Provincial Treasury consulted and assisted departments in verifying the amounts involved and the circumstances prevailing at the time of the
transgression. The payments were individually evaluated and recommended for condonement by a committee consisting of the Acting Accountant
General and representatives of the Supply Chain Management and the Internal Audit units at Provincial Treasury. Where the information was
insufficient to make recommendation the case was referred back departments for further investigation. Cases that are under forensic or other
investigations were not considered at this stage pending the outcome of such investigations
In evaluating each case the Provincial Treasury considered the following:
(a) the circumstances of the transgression;
(b) the extent of the expenditure involved;
(c) the nature and seriousness of the transgression;
(d) outstanding investigations or court proceedings;
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
DISCLOSURE NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
70
(e) the effect of compliance on service delivery;
(f) whether the service was provided and a check on value for money;
(g) the potential cost involved in further investigations into old cases;
(h) steps taken by departments to rectify the matters;
(i) the extent of possible misinterpretation of the prescript; and
(j) the practical challenges to adhere to all the prescripts.
21.2 Details of irregular expenditure
Incident Disciplinary steps taken/criminal proceedings
Procurement of goods and services without obtaining 3 quotes None 1,613
1,808
Transacting with suppliers who did not sign SBD4 form None 1,466
191
Total
3,079
1,999
21.3 Details of irregular expenditure under investigation
Incident
Disciplinary steps taken/criminal proceedings
Cases which are under investigation by Internal Audit – Provincial Treasury
None 5,078
-
Total
5,078
-
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
DISCLOSURE NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
71
2012/13
2011/12
R'000
R'000 22 Fruitless and wasteful expenditure
22.1 Reconciliation of fruitless and wasteful expenditure
Opening balance
-
-
Fruitless and wasteful expenditure – relating to prior year
-
-
Fruitless and wasteful expenditure – relating to current year
4
-
Less: Amounts condoned
-
-
Less: Amounts transferred to receivables for recovery
-
-
Fruitless and wasteful expenditure awaiting condonement
4
-
Analysis of awaiting condonement per economic classification
Current
4
-
Capital
-
-
Transfers and subsidies
-
-
Total
4
-
22.2 Analysis of current year’s fruitless and wasteful expenditure
Incident Disciplinary steps taken/criminal proceedings
Interest incurred on late payment of First Auto accounts None 4
-
Total
4
-
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
DISCLOSURE NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
72
2012/13
2011/12
R'000
R'000
R'000
R'000 23 Key management personnel
No. of Individuals
Level 14 (CFO )
1 736
693
Level 15 (AO)
1 -
796
Total
736
1,489
Note
The salary for the MEC and the Acting Accounting Officer of the Department of the Royal Household is budgeted for under Vote 1: Office of the Premier.
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
DISCLOSURE NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
73
24 Movable Tangible Capital Assets
MOVEMENT IN MOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED 31 MARCH 2013
Opening balance
Current year
adjustments to prior year balances Additions Disposals
Closing balance
R'000 R'000 R'000 R'000
R'000
MACHINERY AND EQUIPMENT 12,252 - 1,245 192
13,305
Transport assets
8,764 - 1,061 - 10,281
Computer equipment
441 - 75 94 422
Furniture and office equipment 280 - - - 280
Other machinery and equipment 2,311 - 109 98 2,322
BIOLOGICAL ASSETS 84 - - - 84
Biological assets 84 - - - 84
TOTAL MOVABLE TANGIBLE CAPITAL ASSETS
12,252 - 1,245 192
13,389
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
DISCLOSURE NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
74
24.1 Additions
ADDITIONS TO MOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED 31 MARCH 2013
Cash Non-cash
(Capital work-in-progress current
costs and finance lease payments)
Received current, not paid (Paid current year,
received prior year
Total
R'000 R'000 R'000 R'000
R'000
MACHINERY AND EQUIPMENT 640 - - 605
1,245
Transport assets 456 - - 605
1,061
Computer equipment 75 - - -
75
Other machinery and equipment 109 - - -
109
BIOLOGICAL ASSETS - - - -
-
Biological assets - - - -
-
TOTAL ADDITIONS TO MOVABLE TANGIBLE CAPITAL ASSETS
640 - - 605
1,245
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
DISCLOSURE NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
75
24.2
Disposals
DISPOSALS OF MOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED 31 MARCH 2013
Sold for Cash
Transfer out or destroyed or
scrapped Total disposals
Cash received actual
R'000 R'000 R'000
R'000
MACHINERY AND EQUIPMENT - 192 192
-
Transport assets
- - -
-
Computer equipment
- 94 94
-
Furniture and office equipment - - -
-
Other machinery and equipment - 98 98
-
TOTAL DISPOSAL OF MOVABLE TANGIBLE CAPITAL ASSETS
- 192 192
-
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
DISCLOSURE NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
76
24.3 Movement for 2011/12
MOVEMENT IN MOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED 31 MARCH 2012
Opening balance Additions Disposals
Closing balance
R'000 R'000 R'000
R'000
MACHINERY AND EQUIPMENT
11,291 961 -
12,252
Transport assets
8,764 456 -
9,220
Computer equipment
441 - -
441
Furniture and office equipment
44 236 -
280
Other machinery and equipment
2,042 269 -
2,311
BIOLOGICAL ASSETS 84 -
84
Biological assets
84 - -
84
TOTAL MOVABLE TANGIBLE CAPITAL ASSETS
11,375 961 -
12,336
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
DISCLOSURE NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
77
24.4 Minor assets
MINOR ASSETS OF THE DEPARTMENT AS AT 31 MARCH 2013
Intangible assets Heritage assets
Machinery and equipment Biological assets
Total
R'000 R'000 R'000 R'000
R'000
Opening balance
- - 362 -
362
Current year adjustments to prior year balances - - - -
-
Additions
- - 14 -
14
Disposals
- - 48 -
48
TOTAL
- - 328 -
328
Intangible assets Heritage assets
Machinery and equipment Biological assets
Total
Number of R1 minor assets - - 708 -
708
Number of minor assets at cost -
133 -
133
-
TOTAL
- - 841 -
841
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
DISCLOSURE NOTES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
78
24.5 Minor assets
MINOR ASSETS OF THE DEPARTMENT AS AT 31 MARCH 2012
Intangible assets Heritage assets
Machinery and equipment Biological assets
Total
R'000 R'000 R'000 R'000
R'000
Opening balance
- - 319 -
319
Current year adjustments to prior year balances - -
-
Additions
- - 43 -
43
Disposals
- - - -
-
TOTAL
- - 362 -
362
Intangible assets Heritage assets
Machinery and equipment Biological assets
Total
Number of R1 minor assets - - 750 -
750
Number of minor assets at cost - - 155 -
155
TOTAL
- - 905 -
905
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
79
ANNEXURE 1A
STATEMENT OF TRANSFERS TO DEPARTMENTAL AGENCIES AND ACCOUNTS
TRANSFER ALLOCATION EXPENDITURE 2011/12
DEPARTMENT/AGENCY/ ACCOUNT
Adjusted appropriation
Act Roll Overs Adjustments Total Available Actual Transfer
% of Available funds
transferred
Appropriation Act
R'000 R'000 R'000 R'000 R'000 % R'000
Royal Household Trust
Department of Transport
10,800
8
-
-
-
-
10,800
8
10,500
28
97%
350%
11,300
-
Total 10,808 - - 10,808 10,528
11,300
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
80
ANNEXURE 1B
STATEMENT OF TRANSFERS TO HOUSEHOLDS
TRANSFER ALLOCATION EXPENDITURE 2011/12
HOUSEHOLDS Adjusted
appropriation Act Roll Overs Adjustments Total Available Actual Transfer
% of Available funds
transferred
Appropriation Act
R'000 R'000 R'000 R'000 R'000 % R'000
Leave gratuity 313 - - 313 606 194% 224
Total 313 - - 313 606
224
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
81
ANNEXURE 2
STATEMENT OF FINANCIAL GUARANTEES
GUARANTOR INSTITUTION
Guarantee in respect of
Original guaranteed
capital amount
Opening balance
1 April 2012
Guarantees draw downs
during the year
Guaranteed repayments/
cancelled/ reduced/ released
during the year
Revaluations
Closing balance
31 March 2013
Guaranteed interest for year ended
31 March 2013
Realised losses not
recoverable i.e. claims
paid out
R'000 R'000 R'000 R'000 R'000 R'000 R'000 R'000
Ithala Limited Housing loan - - - - - - - -
Standard Bank Housing loan - - - - - - - -
Total
- - - - - - - -
DEPARTMENT OF THE ROYAL HOUSEHOLD
VOTE 10
ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS For the year ended 31 March 2013
82
ANNEXURE 3
STATEMENT OF CONTINGENT LIABILITIES
Nature of liability
Opening balance 1 April 2012
Liabilities incurred during the year
Liabilities paid/ cancelled/ reduced
during the year
Liabilities recoverable
Closing balance 31 March 2013
R'000 R'000 R'000 R'000 R'000
Claims against the department - - - - -
Total - - - - -
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
83
ANNEXURE 4
CLAIMS RECOVERABLE
Confirmed balance outstanding Unconfirmed balance outstanding Total
GOVERNMENT ENTITY 31/03/2013 31/03/2012 31/03/2013 31/03/2012 31/03/2013 31/03/2012
R'000 R'000 R'000 R'000 R'000 R'000
Department
KZN Office of the Premier - - 1,249 1,249 1,249 1,249
KZN Provincial Treasury - - 1,750 478 1,750 478
Subtotal - - 2,999 1,727 2,999 1,727
Other Government Entities
Royal Household Trust - - 2,619 2,350 2,619 2,350
Subtotal - - 2,619 2,350 2,619 2,350
Total - - 5,618 4,077 5,618 4,077
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
84
ANNEXURE 5
INTER-GOVERNMENT PAYABLES
Confirmed balance outstanding Unconfirmed balance outstanding Total
GOVERNMENT ENTITY 31/03/2013 31/03/2012 31/03/2013 31/03/2012 31/03/2013 31/03/2012
R'000 R'000 R'000 R'000 R'000 R'000
DEPARTMENTS
Current
KZN Department of Transport 1,066 461 1,398 944 2,464 1,405
KZN Office of the Premier 300 300 - - 300 300
Subtotal 1,366 761 1,398 944 2,764 1,705
Non-current KZN Department of Works - - 145 217 145 217
Subtotal - - 145 217 145 217
Total 1,366 761 1,543 1,161 2,909 1,922
OTHER GOVERNMENT ENTITY
Current
Royal Household Trust - - 300 700 300 700
Subtotal - - 300 700 300 700
Total 1,366 761 1,843 1,861 3,209 2,622
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
85
ANNEXURE 6
INVENTORY
Inventory Quantity 2012/13 R’000
Quantity 2011/12 R’000
Opening balance - - - - Add/(Less): Adjustments to prior year balances
- -
- -
Add: Additions/Purchases – Cash - 1,866 - 3,838 Add: Additions – Non-Cash - - - - (Less): Disposals - - - - (Less): Issues - (1,866) - (3,838) Add/(Less): Adjustments - - - - Closing balance - - - -
86
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
DEPARTMENT OF THE ROYAL HOUSEHOLD VOTE 10
ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS
For the year ended 31 March 2013
ANNEXURE 7 IMMOVABLE ASSETS Movements to immovable assets – 2012/13
The department has applied the exemption as granted by National Treasury and thus where there is uncertainty with regard to ownership of immovable assets these have not been disclosed on the face of the annual financial statements. Additions
The additions for the current year were R 12,715,000-00 (2011/12 – R 2,527,000-00). Disposals
The disposals for the current year were nil (2011/12 – nil). Supplementary information
The supplementary information presented does not form part of the annual financial statements and is un-audited.
88
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
1. Expenditure
The following tables provide a summary per programme (Table 1.1) and salary bands (Table
1.2), of expenditure incurred as a result of salaries, overtime, home owners allowance and
medical assistance. In each case, the table provides an indication of the percentage of the
personnel budget that was used for these items.
Table 1.1 - Personnel costs by programme, 2012/13
Programme
Total
Expenditure
(R’000)
Personnel
Expenditure
(R’000)
Training
Expenditure
(R’000)
Professional
and Special
Services
(R’000)
Personnel
cost as a
percent of
total
expenditure
Average
personnel
cost per
employee
(R’000)
Programme 1 34,421 10,151 - - 29,5 70
Programme 2 24,393 9,816 - - 40,2 74
Programme 3 2,553 1,427 - - 55,9 11
Total 61,367 21,394 - - 34,8 155
Table 1.2 – Personnel costs by salary bands, 2012/13
Salary bands Personnel
Expenditure (R’000)
% of total personnel
cost
Average personnel
cost per employee
(R’000)
Number of
employees
Lower skilled (Levels 1-2) 8,613 40,3 106 81
Skilled (Levels 3-5) 5,733 26,8 143 40
Highly skilled production
(Levels 6-8) 1,837 8,6 262 7
Highly skilled supervision
(Levels 9-12) 3,375 15,8 482 7
Senior management
(Levels 13-16) 736 3,4 736 1
Contract (Levels 13-16) - - - -
Abnormal Appointments 1,100 5,1 550 2
Total 21,394 100.0 155 138
89
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
2. Employment and vacancies
The following tables summarise the number of posts on the establishment, the number of
employees, the vacancy rate, and whether there are any staff that are additional to the
establishment. This information is presented in terms of three key variables: - programme
(Table 2.1), salary band (Table 2.2) and critical occupations.
The vacancy rate reflects the percentage of posts that are not filled.
Table 2.1 – Employment and vacancies by programme, 31 March 2013
Programme Number of posts Number of posts
filled Vacancy Rate
Number of posts
filled additional to
the establishment
Programme 1 52 37 28,8 -
Programme 2 113 93 17,7 -
Programme 3 10 8 20 -
Total 175 138 21,1 -
Table 2.2 – Employment and vacancies by salary bands, 31 March 2013
Salary band Number of posts Number of posts
filled Vacancy Rate
Number of posts
filled additional to
the establishment
Lower skilled
(Levels 1-2) 98 81 17,3 -
Skilled
(Levels 3-5) 47 40 14,9 -
Highly skilled
production
(Levels 6-8)
14 7 50 -
Highly skilled
supervision
(Levels 9-12)
14 7 50 -
Senior management
(Levels 13-16) 2 1 50 -
Contract
(Levels 13-16) - - - -
Abnormal
Appointments - 2 - -
Total 175 138 22.3 -
90
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
3. Job evaluation
The Public Service Regulations, 1999, introduced job evaluation as a way of ensuring that work
of equal value is remunerated equally. Within a nationally determined framework, Executing
Authorities may evaluate or re-evaluate any job in their departments. In terms of the
Regulations, all vacancies on salary levels 9 and higher must be evaluated before they are
filled. This was complemented by a decision by the Minister for the Public Service and
Administration that all SMS jobs must be evaluated before 31 December 2002.
The following table (Table 3.1) summarises the number of jobs that were evaluated during the
year under review. The table also provides statistics on the number of posts that were
upgraded or downgraded.
Table 3.1 – Job Evaluation, 1 April 2012 to 31 March 2013
Salary band Number of
posts
Number of
Jobs
Evaluated
% of posts
evaluated
by salary
bands
Posts Upgraded Posts downgraded
Number % of posts
evaluated Number
% of
posts
evaluated
Lower skilled
(Levels 1-2) 98 - - - - - -
Contract
(Band C) - - - - - - -
Skilled
(Levels 3-5) 47 1 2,1 - - - -
Highly skilled
production
(Levels 6-8)
14 - - - - - -
Highly skilled
supervision
(Levels 9-12)
14 - - - - - -
Senior
Management
Service Band A
1 - - - - - -
Senior
Management
Service Band C
1 - - - - - -
Total 175 1 0,6 - - - -
The following table (Table 3.2) provides a summary of the number of employees whose salary
positions were upgraded due to their posts being upgraded. The number of employees might
differ from the number of posts upgraded since not all employees are automatically absorbed
into the new posts and some of the posts upgraded could also be vacant.
Table 3.2 – Profile of employees whose salary positions were upgraded due to their posts
being upgraded, 1 April 2012 to 31 March 2013
Beneficiaries African Asian Coloured White Total
Female - - - - -
Male - - - - -
Total - - - - -
Employees with a disability - - - - -
91
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
4. Employment changes
This section provides information on changes in employment over the financial year.
Turnover rates provide an indication of trends in the employment profile of the department. The
following tables provide a summary of turnover rates by salary band (Table 4.1) and by critical
occupations (Table 4.2). Tables 4.3 and 4.4 provide details on promotions in the department
whilst table 4.5 provides an indication of why officials are leaving the department
Table 4.1 – Annual turnover rates by salary band for the period 1 April 2012 to
31 March 2013
Salary Band
Number of
employees per band
as on 1 April 2012
Appointments and
transfers into the
department
Terminations and
transfers out of the
department
Turnover rate
Lower skilled
(Levels 1-2) 92 8 6 6,5
Skilled (Levels 3-5) 28 1 3 10,7
Highly skilled
production(Levels 6-8) 8 - - -
Highly skilled
supervision
(Levels 9-12)
8 - 2 25
Senior Management
Service Band A 1 - - -
Senior Management
Service Band C - - 1 -
Contract Band C 1 - - 100
Total 138 9 12 8,7
92
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
Table 4.2 – Annual turnover rates by critical occupation for the period 1 April 2012 to 31 March 2013
Occupation
Number of
employees per
occupation as on 1
April 2012
Appointments and
transfers into the
department
Terminations and
transfers out of the
department
Turnover rate
Administrative Related 4 - - -
Agriculture Related 2 - - -
Building and other
property caretakers 12 - 3 25
Bus and heavy
vehicles drivers 7 1 - -
Cleaners in offices
workshop hospital etc 54 7 3 5,6
Farm hands and
labourers 17 1 2 11,8
Financial and related
professionals 2 - 1 50
Financial clerks and
credit controllers 3 - - -
Food services aids
and waters 1 - - -
Housekeepers laundry
and related workers 1 - - -
Human resources
clerk 4 - - -
Light vehicle drivers 2 - - -
Messengers, porters
and deliverers 1 - - -
Other administrative
and related clerk and
organisers
3 - 1 33,3
Other occupations 1 - - -
Secretaries and other
keyboard operating
clerk
2 - - -
Security guards 20 - 1 5
Senior managers 2 - 1 50
138 9 12 8,7
93
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
Table 4.3 – Promotions by critical occupation
Occupation Employees as at
1 April 2012
Promotions to
another salary
level
Salary level
promotions as a
% of employees
by occupation
Progressions to
another notch
within a salary
level
Notch
progressions as
a % of
employees by
occupation
Administrative
Related 4 - - 2 50
Agriculture
Related 2 - - 1 50
Building and other
property
caretakers
12 - - 11 91,7
Bus and heavy
vehicles drivers 7 1 14,3 - -
Cleaners in
offices workshop
hospital etc
54 1 1,9 39
72,2
Farm hands and
labourers 17 - - 14 82,4
Financial and
related
professionals
2 - - 1 50
Financial clerks
and credit
controllers
3 - - 1 33.3
Food services
aids and waters 1 - - - -
Housekeepers
laundry and
related workers
1 - - -
Human resources
clerk 4 - - 1 25
Light vehicle
drivers 2 - - - -
Messengers,
porters and
deliverers
1 - - - -
Other
administrative and
related clerk and
organisers
3 - - - -
Other occupations 1 - - 1 100
Secretaries and
other keyboard
operating clerk
2 - - - -
Security guards 20 - - 16 80
Senior managers 2 - - - -
Total 138 2 1,4 87 63
94
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
Table 4.4 – Promotions by salary band
Salary Band Employees 1
April 2012
Promotions to
another salary
level
Salary bands
promotions as a
% of employees
by salary level
Progressions to
another notch
within a salary
level
Notch
progressions as
a % of
employees by
salary band
Lower skilled
(Levels 1-2) 92 - - 62 67,4
Skilled
(Levels 3-5) 28 2 7,1 21 75
Highly skilled
production
(Levels 6-8)
8 - - 2 25
Highly skilled
supervision
(Levels9-12)
8 - - 2 25
Senior
management
(Levels13-16)
1 - - - -
Contract
(Levels 13-16) 1 - - - -
Total 138 2 1,4 87 63
5.
Table 4.5 – Reasons why officials are leaving the department
Termination Type Number % of total
Death 2 1.4
Resignation 1 0,7
Discharged due to ill-health - -
Retirement 9 6,5
Total 11 8,7
Total number of employees who left as a % of the total employment () 8,7
95
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
5. Employment equity
The tables in this section are based on the formats prescribed by the Employment Equity Act,
55 of 1998.
Table 5.1 – Total number of employees (including employees with disabilities) in each of
the following occupational categories as on 31 March 2013
Occupational
categories
(SASCO)
Male Female Total
African Coloured Indian White African Coloured Indian White
Legislators, senior
officials and
managers
1 - - - - - - - 1
Professionals 3 - - - - - - - 3
Technicians and
associate
professionals
3 - - - 1 - - - 1
Clerks 3 - - - 7 - - - 10
Service and sales
workers 19 - - - 1 - - - 20
Skilled agriculture
and fishery
workers
- - - - - - - - -
Craft and related
trades workers - - - - - - - - -
Plant and machine
operators and
assemblers
11 - - - - - - - 11
Elementary
occupations 31 - - - 55 - - - 86
Total 71 - - - 64 - - - 135
Employees with
disabilities - - - - - - - - -
96
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
Table 5.2 – Total number of employees (including employees with disabilities) in each of the following occupational bands as on 31 March 2013
Occupational
Bands
Male Female
African Coloured Indian White African Coloured Indian White Total
Top Management
Senior
Management 1 - - - - - - - 1
Professionally
qualified and
experienced
specialists and
mid-management
6 - - - 1 - - - 7
Skilled technical
and academically
qualified workers,
junior
management,
supervisors,
foreman and
superintendents
2 - - - 4 - - - 6
Semi-skilled and
discretionary
decision making
22 - - - 18 - - - 40
Unskilled and
defined decision
making
40 - - - 41 - - - 81
Contract (Top
Management) - - - - - - - -
Total 71 0 0 0 64 0 0 0 135
97
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
Table 5.3 – Recruitment for the period 1 April 2012 to 31 March 2013
Occupational
Bands
Male Female
African Coloured Indian White African Coloured Indian White Total
Top Management - - - - - - - - -
Senior
Management - - - - - - - - -
Professionally
qualified and
experienced
specialists and
mid-management
- - - - - - - - -
Skilled technical
and academically
qualified workers,
junior
management,
supervisors,
foreman and
superintendents
- - - - - - - - -
Semi-skilled and
discretionary
decision making
1 - - - - - - - 1
Unskilled and
defined decision
making
6 - - - 2 - - - 8
Contract (Top
Management) - - - - - - - - -
Total 7 0 0 0 2 0 0 0 9
98
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
Table 5.4 – Promotions for the period 1 April 2012 to 31 March 2013
Occupational
Bands
Male Female
African Coloured Indian White African Coloured Indian White Total
Top Management - - - - - - - - -
Senior
Management - - - - - - - -
Professionally
qualified and
experienced
specialists and
mid-management
1 - - - 1 - - - 2
Skilled technical
and academically
qualified workers,
junior
management,
supervisors,
foreman and
superintendents
- - - - 2 - - - 2
Semi-skilled and
discretionary
decision making
8 - - - 15 - - - 23
Unskilled and
defined decision
making
28 - - - 34 - - - 62
Total 37 - - - 52 - - - 89
Employees with
disabilities - - - - - - - - -
99
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
Table 5.5 – Terminations for the period 1 April 2012 to 31 March 2013
Occupational
Bands
Male Female
African Coloured Indian White African Coloured Indian White Total
Top Management - - - - - - - - -
Senior
Management - - - - - - - - -
Professionally
qualified and
experienced
specialists and
mid-management
- - - 1 1 - - - 2
Skilled technical
and academically
qualified workers,
junior
management,
supervisors,
foreman and
superintendents
- - - - - - - - -
Semi-skilled and
discretionary
decision making
1 - - - 2 - - - 3
Unskilled and
defined decision
making
2 - - - 4 - - - 6
Contract (Semi-
skilled) 1 - - - - - - - 1
Total 4 1 7 12
Employees with
disabilities - - - - - - - - -
Table 5.6 – Disciplinary action for the period 1 April 2012 to 31 March 2013
Disciplinary
action
Male Female
African Coloured Indian White African Coloured Indian White Total
- - - - - - - - - -
100
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
Table 5.7 – Skills development for the period 1 April 2012 to 31 March 2013
Occupational
categories
Male Female
African Coloured Indian White African Coloured Indian White Total
Legislators,
senior officials
and managers
- - - - - - - - -
Professionals - - - - - - - - -
Technicians and
associate
professionals
- - - - - - - - -
Clerks - - - - - - - - -
Service and sales
workers - - - - - - - - -
Skilled agriculture
and fishery
workers
- - - - - - - - -
Craft and related
trades workers - - - - - - - - -
Plant and
machine
operators and
assemblers
- - - - - - - - -
Elementary
occupations - - - - - - - - -
Total - - - - - - - - -
Employees with
disabilities - - - - - - - - -
6.
6. Performance rewards
Department officials have not been granted performance rewards during the year under review.
7. Foreign workers
There were no foreign nationals in the employment of the department for the year under review.
101
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
8. Leave utilisation for the period 1 January 2012 to 31 December 2012
The Public Service Commission identified the need for careful monitoring of sick leave within the
public service. The following tables provide an indication of the use of sick leave (Table 8.1) and
disability leave (Table 8.2). In both cases, the estimated cost of the leave is also provided.
Table 8.1 – Sick leave, 1 January 2012 to 31 December 2012
Salary Band Total days
% days with
medical
certification
Number of
Employees
using sick
leave
% of total
employees
using sick
leave
Average days
per employee
Estimated
Cost (R’000)
Lower skilled
(Levels 1-2) 188 98,4 21 42,9 9 48
Skilled
(Levels 3-5) 161 98,1 16 32,7 10 54
Highly skilled
production
(Levels 6-8)
60 93,3 5 10,2 12 33
Highly skilled
supervision
(Levels9-12)
59 98,3 7 14,3 8
93
Senior
management
(Levels 13-16)
- - - - - -
Contract
(Levels 13-16) - - - - - -
Total 468 97,6 49 100 10 228
Table 8.2 – Disability leave (temporary and permanent), 1 January 2012 to
31 December 2012
Salary Band Total days
taken
% days with
medical
certification
Number of
Employees
using
disability
leave
% of total
employees
using
disability
leave
Average days
per employee
Estimated
Cost (R’000)
Lower skilled
(Levels 1-2) 261 100 6 75 44 67
Skilled (Levels
3-5) 5 100 1 12,5 5 2
Highly skilled
production
(Levels 6-8)
60 100 1 12,5 60 47
Highly skilled
supervision
(Levels 9-12)
- - - - - -
Senior
management
(Levels 13-16)
- - - - - -
Total 326 100 8 100 41 116
102
royal household Department: Royal Household PROVINCE OF KWAZULU-NATAL
Table 8.3 summarises the utilisation of annual leave. The wage agreement concluded with trade
unions in the PSCBC in 2000 requires management of annual leave to prevent high levels of
accrued leave being paid at the time of termination of service.
Table 8.3 – Annual Leave, 1 January 2012 to 31 December 2012
Salary Bands Total days taken Average per
employee
Number of employees
who took leave
Lower skilled (Levels 1-2) 1269 23 55
Skilled Levels 3-5) 765 20 38
Highly skilled production (Levels 6-8) 78 13 6
Highly skilled supervision(Levels 9-12) 116 15 8
Senior management (Levels 13-16) 10 10 1
Contract (Levels 13-16) - - -
Total 2238 21 108
Table 8.4 – Capped leave, 1 January 2012 to 31 December 2012
Salary Bands
Total days of
capped leave
taken
Average
number of
days taken per
employee
Average
capped leave
per employee
as at 31
December
2011
Number of
employees
who took
capped leave
Total number
of days of
capped leave
available as at
31 December
2011
Lower skilled (Levels 1-2) - - - - -
Skilled Levels 3-5) - - - - -
Highly skilled production
(Levels 6-8) - - -
- -
Highly skilled
supervision(Levels 9-12) - - - - -
Senior management (Levels
13-16) - - - - -
Total - - - - -
Table 8.5 – Leave payouts for the period 1 April 2012 to 31 March 2013
The following table summarises payments made to employees as a result of leave that was not
taken.
REASON Total Amount
(R’000)
Number of
Employees
Average payment
per employee
(R’000)
Capped leave payouts on termination of service 114 25 4560
Total 114 25 4560