2008/9 ICASA Annual Report Presentation to Portfolio Committee on Communications 2008/9 ICASA Annual Report Presentation to Portfolio Committee on Communications 03 November 2009 Paris Mashile - Chairperson Karabo Motlana - CEO

Outline of Presentation Vision Mission Strategic objectives Regulatory Divisions  Licensing & Compliance  Markets & Competition  Engineering & Technology  Consumer Affairs  Legal & CCC Stakeholder Management International Participation ICASA & Its People Financial Reports  Annual Financial Statements  Administered Revenue Fund

VISION To be a credible regulator in the transformation of South Africa into an information and knowledge-based society.

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

5 Strategic Objectives  Increase the availability and quality of electronic communication services to domestic and business users  Encourage and maintain pro-competitive market through effective competition and transparent regulation  Develop regulatory policies that promote competition, innovation and investment in services and facilities providing widespread access to ICTs

Strategic Objectives (cont.)  Maximize the net economic and social worth of the sector, including its strategic use as a catalyst for economic, social and technological development in other areas of the economy  Broaden economic participation in the sector by SMMEs  Encourage and support the successful introduction of new technologies and services

Licensing Completed license conversion process as required by EC Act and issued over 600 class and individual licences. Issued two trial licences for Digital Migration. Registered 46 courier companies. Aligned SAPO licence with Postal Services Act (as amended), the ECA and the ICASA Act (as amended).

Licensing Regulations Published draft Licence Fees regulations & conducted public hearings. Published Licensing Process and Procedures regulations. Published Licence Exempt regulations.

Compliance Compiled 55 reports on broadcasting licencee’s compliance with the ECA and licence terms and conditions. Conducted 45 monitoring visits to assist licencees in complying with licence terms and conditions. Received 76 broadcasting complaints:  44 resolved by the department;  5 referred Complaints & Compliance Committee (CCC);  36 referred to industry led bodies i.e. Advertising Standards Authority of South Africa (ASA) and Broadcasting Complaints Commission of South Africa (BCCSA).

Compliance (cont.) Conducted 46 monitoring visits to reserved postal outlets. Verified reports submitted by SAPO on delivery points & infrastructure roll-out targets. Received 60 complaints:  34 referred to SAPO for resolution;  22 resolved by the department;  2 referred to CCC;  2 were still under investigation.

Markets & Competition Published Carrier pre-Select draft regulations. Published Must Carry regulations. Published Universal Access regulations. Published Party Election Broadcasts & Political Advertisements regulations. Published Advertising, Infomercials & Sponsorship draft regulations. Published Code of Conduct for Broadcasters draft regulations. Published the Digital Terrestrial Television draft regulations. Published Commissioning of Independently Produced South African Programming discussion document. Published Sports Broadcasting Rights discussion document.

Markets & Competition (cont.) Processed 36 interconnection agreements. Analysed and approved Telkom’s 2008/9 tariff review. Analysed and approved SAPO’s 2008/9 tariff review. Analysed and processed 57 ad-hoc tariff applications. Processed 315 numbering applications.

Engineering & Technology Commissioned a study to develop new Radio Spectrum Licence fees framework. Published draft Radio Frequency Plan regulations. Published Radio Frequency Identification systems regulations. Published conditions of exemption of certain radio frequencies from licensing. Published draft Terrestrial Broadcasting Frequency Plan. Published Findings Documents for High Demand Frequency Bands.

Engineering & Technology (cont.) Confiscated 471 units of equipment due to non-compliance. Closed down illegal broadcasters & confiscated their equipment. Issued warning and closed down unlicensed operators. Returned 223 units of confiscated equipments to owners who complied. Sealed radios due to non-payment. Actioned licensee files received from Finance Department. Issued 6089 frequency spectrum licences. Issued 1826 type approval licences. Conducted 649 maritime restricted radio telephone examinations. Conducted 77 high site inspections. Identified 275 interference cases and cleared 267.

Consumer Affairs CRFs established in KwaZulu-Natal, Limpopo and Mpumalanga. Monitored compliance with consumer protection regulations in Gauteng and North West. Printed publications on :  Complaints handling processes  Type approval pamphlets  112 Emergency Services  Consumer Rights Day Conducted research on the impact of the Authority’s Public Education and Awareness programmes. Conducted research on consumer experiences on Mobile Number Portability.

Consumer Affairs (cont.) Conducted feasibility study on the establishment of the call centre. Co-ordinated four mandatory Consumer Advisory Panel meetings. Conducted 433 public education and awareness outreach programmes in all provinces. Reached out to consumers through 124 radio interviews. Conducted Consumer Rights road shows in all provinces. Resolved 64% of consumer complaints received.

Consumer Affairs (cont.) Partnered with other stakeholders and provided information at the following campaigns:  World Telecommunications Day;  Youth Day;  World Post Day;  International Day of People with Disabilities.

Legal & CCC ICASA operates in a highly litigious environment as its decisions are frequently taken on review by aggrieved applicants. Complaints & Compliance Committee adjudicated 9 licensees charged with non-compliance of their licence conditions. Litigation cases:  Regulatory – 15  Non-regulatory – 1  Labour matters - 2

Stakeholder Relations Internal stakeholders  Launched and published a daily electronic newsflash – iNews.  Published quarterly edition of internal newsletter.  Arranged staff meeting at Head and Regional Offices.  Hosted internal functions & events e.g. Wellness Day, Family Day. Sports Day and Staff end of the year function.

Stakeholder Relations (cont.) External stakeholders  Issued Media Releases and arranged interviews about regulatory activities.  Placed Media Notices in leading national daily newspapers.  Published media Releases, government gazettes and other regulatory information on the website.  Coordinated production and tabling of Annual Report.  Participated in exhibitions and road-shows to raise awareness about Authority’s mandate.  Facilitated responses to enquiries.  Arranged Stakeholder Meeting to brief licensees and operators about regulatory activities.  Commissioned production of corporate video outlining Authority’s mandate and deliverables.

Stakeholder Relations (cont.) International Participation - Coordinated the Authority’s international participation in relation to:  Attendance of and submissions made to Universal Postal Union, International Telecommunications Union, CRASA, SAPRA, SADC Ministers Roundtable on ICTs.  Developed calendar of meeting and events.  Arranged bilateral interaction with regulators from Brazil, Tanzania and Malawi.  Subscribed to international regulatory organisations/associations.

ICASA & Its People Out of 59 vacancies, 58 vacancies were filled. 536 participants attended a range of training courses. R2,7m spent on training which represents 3% of the total salary budget. Conducted a job competence profiling and skills audit. Introduced integrated performance management.

Demographics Year to date permanent employee demographic profile as at 31 March 2009: Mar-08Mar-09% Variance Population GroupTotal % in each group Total % in each group African23870%24172%2% Asian175%175%0% Coloured237%237%0% White6118%5416%-2%

Demographics (cont.) Race, Gender & Rank Comparative Analysis: Headcount Stats Population Group Total Female Total Male Grand Total AfricanAsianColouredWhite FMFMFMFM Council Executive Management Senior Management Managers Total Management General Staff Total Staff Percentages35%37%1%4%2%4% 12%43%57%100%

Finance & Risk Auditor General attention drawn to the following: 1.Fruitless and wasteful expenditure = R due to penalties incurred. 2.Irregular expenditure = R due to non compliance with supply chain management processes. 3.ICASA did not submit monthly management accounts to DOC. 4.ICASA did not prepare and sign performance contract with CEO. 5.ICASA did not pay suppliers within 30 days. 6.Qualified opinion : Accounts receivable relating spectrum debtors of R Council PMS outstanding

Finance & Risk (cont.) Corrective Action: internal controls An internal audit function has been set-up to co-ordinate operational and financial units Corrective Action: CEO Contract A performance contract has been signed by the CEO outlining quarterly appraisal Corrective Action: Risk Management A risk strategy has been developed Corrective Action: reports to Doc ICASA has been submitting monthly performance reports to DOC Corrective Action: Council PMS Commenced discussions 2007 and Draft PMS submitted to DOC in October Corrective Action: Debtors Spectrum Implement the billing system for spectrum

Statement of Financial Performance: MAIN ACCOUNT Note 31 March 2009 R 31 March 2008 R REVENUE Total grants appropriated Other income EXPENDITURE( )( ) Administrative expenses4( )( ) Staff costs5( )( ) Audit fees6( )( ) Other operating expenses7( )( ) Depreciation11( )( ) Amortisation23( )( ) DEFICIT FROM OPERATIONS( )( ) Finance income Finance costs8(81 204)( ) Total finance Income SURPLUS FOR THE YEAR

Note 31 March 2009 R 31 March 2008 R ASSETS Non-current assets Property, plant and equipment Intangible assets Current assets Trade and other receivables Prepayments and advances Cash and cash equivalents TOTAL ASSETS LIABILITIES Current liabilities Trade and other payables Current portion of lease accruals Current portion of deferred grants Current portion of finance lease obligations: on Non-current liabilities Non-current portion of deferred income grants Non-current portion of lease accruals Non-current portion of finance lease obligations: (S TOTAL LIABILITIES FUNDS ACCUMULATED RESERVES Start-up fund Accumulated deficit( )( ) TOTAL FUNDS AND LIABILITIES Statement of Financial Position: MAIN ACCOUNT

Statement of Financial Performance: NATIONAL REVENUE FUND Note31 March March 2008 RR REVENUE OTHER INCOME EXPENDITURE( )( ) Impairment of accounts receivable2( )( ) Commission( )( ) Bank charges(23 456)(13 360) Transfers to DoC( )( ) (DEFICIT)/SURPLUS FROM OPERATIONS( ) ( ) NET FINANCE INCOME Unearned income Finance income Finance costs10( )( ) NET (DEFICIT)/SURPLUS FOR THE YEAR--

Statement of Financial Position: NATIONAL REVENUE FUND Note31 March March 2008 RR ASSETS Current Assets Trade and other receivables Cash and cash equivalents Total Assets LIABILITIES Current liabilities NRF Payables NRF Provision TOTAL FUNDS AND LIABILITIES

Thank you Dankie Re a leboha Re a leboga Siyabonga Inkomu Ro livhuwa Enkosi