NC062 Nama Khoi AFS 2015-16 audited

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NAMA KHOI LOCAL MUNICIPALITY
ANNUAL FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
NAMA KHOI LOCAL MUNICIPALITY
Annual Financial Statements for the year ended 30 June 2016
GENERAL INFORMATION
NATURE OF BUSINESS AND PRINCIPAL Nama Khoi Municipality is a local municipality performing the
ACTIVITIES functions as set out in the Constitution. (Act no 105 of 1996)
LEGAL FORM OF ENTITY South African Category B Municipality (Local Municipality)
Grade 2 as defined by the Municipal Structures Act. (Act no 117
of 1998)
MUNICIPAL MANAGER SA Titus (Acting)
CHIEF FINANCE OFFICER (CFO) WJ Bowers (Acting)
REGISTERED OFFICE Private Bag X17
Springbok
8240
AUDITORS Auditor-General
Private Bag X5013
Kimberley
8300
BANKERS ABSA
ATTORNEYS Neville Cloete Attorneys
Webber Wentzel
Shreuders Attorneys
Abrahams & Gross
Wessels & Smith
Towell & Groenewaldt
Bower & Kie
RELEVANT LEGISLATION Municipal Finance Management Act (Act no 56 of 2003)
Division of Revenue Act
The Income Tax Act
Value Added Tax Act
Municipal Structures Act (Act no 117 of 1998)
Municipal Systems Act (Act no 32 of 2000)
Municipal Systems Amendment Act (Act no 7 of 2011)
Municipal Planning and Performance Management Regulations
Water Services Act (Act no 108 of 1997)
Housing Act (Act no 107 of 1997)
Municipal Property Rates Act (Act no 6 of 2004)
Electricity Act (Act no 41 of 1987)
Skills Development Levies Act (Act no 9 of 1999)
Employment Equity Act (Act no 55 of 1998)
Unemployment Insurance Act (Act no 30 of 1966)
Basic Conditions of Employment Act (Act no 75 of 1997)
Supply Chain Management Regulations, 2005
Collective Agreements
Infrastructure Grants
SALBC Leave Regulations
Municipal Budget and Reporting Regulations
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NAMA KHOI LOCAL MUNICIPALITY
Annual Financial Statements for the year ended 30 June 2016
GENERAL INFORMATION
MEMBERS OF THE MAYORAL COMMITTEE JF van Wyk (Resigned 10/08/2016)
LF Faber
WS Jordaan
FX Cupido (Resigned 10/08/2016)
D Joseph (Appointed 15/08/2016)
S Kleinbooi (Appointed 15/08/2016)
MEMBERS OF THE MUNICIPALITY
Ward Councillor
1 HS Apollis (Resigned 10/08/2016)
1 JE van der Heever (Appointed 15/08/2016)
2 EF Maritz (Resigned 10/08/2016)
2 DA Markus (Appointed 15/08/2016)
3 FX Cupido (Resigned 10/08/2016)
3 CE Gertze (Appointed 15/08/2016)
4 R Kritzinger
5 S Kleinbooi
6 G Cloete (Resigned 10/08/2016)
6 CG Coetzee (Appointed 15/08/2016)
7 SD Hoskin (Resigned 10/08/2016)
7 Y van Zyl (Appointed 15/08/2016)
8 WJ Goedeman ((Resigned 10/08/2016)
8 P van Reenen (Appointed 15/08/2016)
9 GY Pieters
Proportional LF Faber (Appointed 15/08/2016)
Proportional G Coetzee
Proportional D Joseph (Appointed 15/08/2016)
Proportional SJC van Wyk
Proportional Z de Jongh (Appointed 15/08/2016)
Proportional L Vries (Appointed 15/08/2016)
Proportional SH Ruiter (Appointed 15/08/2016)
Proportional SW Lubbe (Resigned 10/08/2016)
Proportional KS Ventura (Resigned 10/08/2016)
Proportional M Diedericks (Resigned 10/08/2016)
Proportional WS Jordaan (Appointed 15/08/2016)
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NAMA KHOI LOCAL MUNICIPALITY
Annual Financial Statements for the year ended 30 June 2016
INDEX
PAGE
Approval of annual financial statements 4
Statement of Financial Position 5
Statement of Financial Performance 6
Statement of Changes in Net Assets 7
Cash Flow Statement 8
Statement of Comparison of Budget and Actual Amounts 9 - 11
Accounting Policies 12 - 43
Notes to the Annual Financial Statements 44 - 84
Appendixes:
Appendix A: Schedule of External loans 85
ABBREVIATIONS
COID Compensation for Occupational Injuries and Diseases
CRR Capital Replacement Reserve
DBSA Development Bank of South Africa
SA GAAP South African Statements of Generally Accepted Accounting Practice
GRAP Generally Recognised Accounting Practice
GAMAP Generally Accepted Municipal Accounting Practice
HDF Housing Development Fund
IAS International Accounting Standards
IMFO Institute of Municipal Finance Officers
IPSAS International Public Sector Accounting Standards
ME's Municipal Entities
MEC Member of the Executive Council
MFMA Municipal Finance Management Act
MIG Municipal Infrastructure Grant (Previously CMIP)
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NAMA KHOI LOCAL MUNICIPALITY
Annual Financial Statements for the year ended 30 June 2016
APPROVAL OF ANNUAL FINANCIAL STATEMENTS
I am responsible for the preparation of these annual financial statements year ended 30 June 2016, which are
set out on pages 4 to 86 in terms of Section 126 (1) of the Municipal Finance Management Act and which I
have signed on behalf of the Municipality. The annual financial statements have been prepared in accordance
with GRAP.
I acknowledge that I am ultimately responsible for the system of internal financial control and that the system of
internal control provides reasonable assurance that the financial records can be relied on.
I have reviewed the Municipality’s cash flow forecast for the year to 30 June 2017 and am satisfied that the
Municipality can continue in operational existence for the foreseeable future.
The external auditorsare responsible for independently reviewing and reporting on the Municipality's annual
financial statements.
I certify that the remuneration of Councillors and in-kind benefits are within the upper limits of the framework
envisaged in Section 219 of the Constitution, read with the Remuneration of Public Officer Bearers Act and the
Minister of Provincial and Local Government's determination in accordance with this Act.
Municipal Manager
31 August 2016
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NAMA KHOI LOCAL MUNICIPALITY
Annual Financial Statements for the year ended 30 June 2016
STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2016
2016 2015
Restated*
Note(s) R R
ASSETS
Current Assets
Inventories 8 917 413 960 525
Receivables from non-exchange transactions 9 5 482 066 5 316 694
Receivables from exchange transactions 10 12 831 053 10 838 438
Taxes 11 12 290 529 8 682 141
Cash and cash equivalents 12 18 995 442 30 020 459
50 516 503 55 818 257
Non-Current Assets
Investment property 2 23 885 657 24 941 275
Property, plant and equipment 3 585 202 494 603 069 384
Intangible assets 5 90 887 141 554
Operating lease asset 6 108 124 49 158
609 287 162 628 201 371
Total Assets 659 803 665 684 019 628
LIABILITIES
Current Liabilities
Other financial liabilities 16 404 519 930 439
Finance lease obligation 14 216 716 106 574
Payables from exchange transactions 17 186 623 531 163 770 803
Consumer deposits 19 2 801 390 2 394 647
Employee benefit obligation 13 948 299 913 408
Unspent conditional grants and receipts 15 2 979 770 25 399 120
Provisions 18 1 031 714 1 304 045
195 005 939 194 819 036
Non-Current Liabilities
Other financial liabilities 16 - 427 940
Finance lease obligation 14 244 426 88 104
Employee benefit obligation 13 19 694 883 18 655 660
Provisions 18 23 388 699 21 734 080
43 328 008 40 905 784
Total Liabilities 238 333 947 235 724 820
Net Assets 421 469 718 448 294 808
Accumulated surplus 421 469 718 448 294 808
* See Note
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NAMA KHOI LOCAL MUNICIPALITY
Annual Financial Statements for the year ended 30 June 2016
STATEMENT OF FINANCIAL PERFORMANCE
2016 2015
Restated*
Note(s) R R
Revenue
Revenue from exchange transactions
Service charges 21 113 539 694 96 775 138
Agency services 1 307 101 1 191 406
Licences and permits 1 260 853 1 255 862
Rental income 1 830 578 701 601
Other income 2 862 653 2 010 073
Interest received 23 7 107 843 5 944 619
Total revenue from exchange transactions 127 908 722 107 878 699
Revenue from non-exchange transactions
Taxation revenue
Property rates 22 34 187 763 35 813 662
Transfer revenue
Government grants & subsidies 24 64 897 911 48 899 924
Fines 446 427 505 895
Total revenue from non-exchange transactions 99 532 101 85 219 481
Total revenue 20 227 440 823 193 098 180
Expenditure
Employee related costs 25 (76 091 397) (65 797 740)
Remuneration of councillors 26 (5 057 830) (4 738 762)
Depreciation and amortisation 27 (40 015 145) (38 167 155)
Finance costs 28 (2 946 140) (7 085 062)
Debt Impairment 29 (9 377 208) (22 686 109)
Bulk purchases 30 (84 145 507) (79 371 622)
Contracted services 31 (1 493 257) (1 040 321)
Finance cost - Non Current Liabilities (1 382 287) (871 950)
General Expenses 32 (35 040 020) (35 637 234)
Total expenditure (255 548 791) (255 395 955)
Operating deficit (28 107 968) (62 297 775)
Gain (loss) on disposal of assets and liabilities 122 952 (47 289)
Actuarial gains 13 1 361 058 1 623 270
Inventories losses/write-downs (201 133) (419 527)
1 282 877 1 156 454
Deficit for the year (26 825 091) (61 141 321)
* See Note
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NAMA KHOI LOCAL MUNICIPALITY
Annual Financial Statements for the year ended 30 June 2016
STATEMENT OF CHANGES IN NET ASSETS
Accumulated Total net
surplus assets
R R
Balance at 01 July 2014 451 956 008 451 956 008
Changes in net assets
Correction of Error 57 480 121 57 480 121
Surplus for the year (61 141 321) (61 141 321)
Restated* Balance at 01 July 2015 448 294 809 448 294 809
Changes in net assets
Surplus for the year (26 825 091) (26 825 091)
Balance at 30 June 2016 421 469 718 421 469 718
* See Note
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NAMA KHOI LOCAL MUNICIPALITY
Annual Financial Statements for the year ended 30 June 2016
CASH FLOW STATEMENT
2016 2015
Restated*
Note(s) R R
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts
Taxation 33 166 747 34 691 268
Sale of goods and services 108 951 807 91 620 757
Grants 42 478 561 88 319 056
Interest income 1 784 635 5 944 619
Other receipts 7 119 361 19 084 418
193 501 111 239 660 118
Payments
Employee costs (77 587 782) (68 032 503)
Suppliers (102 718 738) (92 636 835)
Finance costs (2 946 140) (7 085 062)
(183 252 660) (167 754 400)
Net cash flows from operating activities 33 10 248 451 71 905 718
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property, plant and equipment (21 115 635) (63 698 487)
Purchase of other intangible assets (11 167) -
Net cash flows from investing activities (21 126 802) (63 698 487)
CASH FLOWS FROM FINANCING ACTIVITIES
Loans repaid (1 144 316) -
Consumer deposits 406 743 2 394 647
Loans raised 590 905 194 678
Net cash flows from financing activities (146 668) 2 589 325
Net increase/(decrease) in cash and cash equivalents (11 025 019) 10 796 556
Cash and cash equivalents at the beginning of the year 30 020 459 19 223 903
Cash and cash equivalents at the end of the year 12 18 995 440 30 020 459
* See Note
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NAMA KHOI MUNICIPALITY
STATEMENT OF COMPARISON OF BUDGET AND ACTUAL AMOUNTS
STATEMENT OF FINANCIAL POSITION AT 30 JUNE 2016
Final Actual Outcome
Budget Adjustment Shifting of as % of Final
Notes Original Budget Adjustments Budget Funds Virement Final Budget Actual Outcome Budget
(i.t.o. s28 and (i.t.o. Council
s31 of the (i.t.o. s31 of the approved by-
MFMA) MFMA) law) 2016
R R R R R R R %
ASSETS
Current Assets
Cash 28,913,000 - 28,913,000 - - 28,913,000 18,995,442 -34.30%
Consumer Debtors 73,686,271 - 73,686,271 - - 73,686,271 18,313,119 100.00%
Other Debtors 12,054,744 - 12,054,744 - - 12,054,744 12,290,529 1.96%
Inventory 1,214,737 - 1,214,737 - - 1,214,737 917,413 -24.48%
Total Current Assets 48 115,868,752 - 115,868,752 - - 115,868,752 50,516,503 -56.40%
Non-Current Assets
Long-term receivables 471,820 - 471,820 - - 471,820 - 100.00%
Investment Property 254,248 - 254,248 - - 254,248 23,885,657 9294.63%
Property, Plant and Equipment 607,860,179 - 607,860,179 - - 607,860,179 585,202,494 -3.73%
Agricultural Assets - - - - - - - -
Biological Assets - - - - - - - -
Intangible Assets 197,168 - 197,168 - - 197,168 90,887 -53.90%
Operating Leases Assets - - - - - - 108,124 100.00%
Total Non-Current Assets 48 608,783,415 - 608,783,415 - - 608,783,415 609,287,162 0.08%
TOTAL ASSETS 724,652,167 - 724,652,167 - - 724,652,167 659,803,665 -8.95%
LIABILITIES
Current Liabilities
Borrowing - - - - - - 621,235 -100.00%
Consumer Deposits 1,583,192 - 1,583,192 - - 1,583,192 2,801,390 76.95%
Trade and Other Payables 103,610,337 - 103,610,337 - - 103,610,337 186,623,531 80.12%
Provisions 10,373,753 - 10,373,753 - - 10,373,753 4,959,783 -52.19%
Total Current Liabilities 48 115,567,282 - 115,567,282 - - 115,567,282 195,005,939 68.74%
Non-Current Liabilities
Borrowing 2,068,071 - 2,068,071 - - 2,068,071 244,426 -88.18%
Provisions 36,967,347 - 36,967,347 - - 36,967,347 43,083,582 16.54%
Total Non-Current Liabilities 48 39,035,418 - 39,035,418 - - 39,035,418 43,328,008 11.00%
TOTAL LIABILITIES 154,602,700 - 154,602,700 - - 154,602,700 238,333,947 54.16%
NET ASSETS
Accumulated Surplus/(Deficit) 570,049,467 - 570,049,467 - - 570,049,467 421,469,718 -26.06%
Reserves - - - - - - - -
TOTAL NET ASSETS 48 570,049,467 - 570,049,467 - - 570,049,467 421,469,718 -26.06%
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