1. 1 Finance Report to the Portfolio of Parliament of RSA Portfolio for Women in the Presidency 6 September 2016

2. Financial Performance and Budget Management Financial Position Cash flow management Corporate Services Risk Management Audit and PFMA related matters 2 Table of contents

3. This presentation seeks to brief the Portfolio Committee on the financial management affairs of the Commission in line with section 181(5) of the Constitution of South Africa The presentation covers activities for the 4 th Quarter of 2015/2016 year and results for the 1 st quarter of the ensuing financial year (viz. 2016/2017). The results for the fourth quarter shall also include effects of corrective actions and other adjustments to fulfil annual targets (APP), including for accounting records. The results will therefore contain these adjustments apart from ordinary activities undertaken during a typical quarter. 3 Introduction

4. The CGE spending for the 4 th quarter and year ending 31 March 2016 were in line with the allocation from National Treasury. The Financial Position as at 31 March 2016 is sound and healthily. The CGE has commenced with the service delivery programme for the new financial year, commencing 1 April 2016. The results so far indicates spending pressures which confirms a budget deficit risk and potential negative impact to operations going forward. During the latter quarter through to the 1 st quarter of 2016/2017, activities also coincided with AGSA Audit work and reporting calendar prescribed by the PFMA. The Financial Statements were submitted to National Treasury and AGSA on the dates prescribed by law as is required. The regularity audit field work was concluded by 30 June 2016. The report is in terms of the PFMA due for tabling by 30 September 2016. During the reporting period, the CGE focussed on the implementation of the audit action plans in line with commitments made to the Portfolio Committee. Due to the success in the implementation, the CGE does not report exception or non- compliance with any laws or regulations to the Committee. 4 Executive Summary

5. Budget issues Spending contained albeit with challenges. Spending pressures anticipated during the 2016/2017 period. There are cost containment strategies and measures in place. However, without space to contain or sustain operations Q1/2016/2017 results reflects a deficit and it is expected. Existing critical vacancies costed to R2m p.a. – Not sufficient room in the budget to absorb the impact Financial Management issues Systems of internal controls in place and improvements being effected based on the updated recommendations by AGSA. Action plans are updated and fully implemented. Oversight bodies fully functional: Internal, audit committee, Risk Management. Effective Openness and Accountability maintained in line with Chapter 13 of the Constitution 5 Executive Summary

6. Summary analysis for Q4 results Revenue granted from Treasury in the fourth quarter was R16, 9 million. A further R4,4 million was recorded, comprised of special grant, donor and interest income. Total income was therefore R21, 4 million for the quarter under review Total expenditure amounted to R20 million, about R3m above an average quarterly spending. This is mainly due to catch up/corrective action undertaken to ensure that all APP targets for the concluding year are met. Spending therefore increased in accord with heightened service delivery activities. Discounting the effects of book entries arising from GRAP – i.e. excluding grants from accumulated surplus, the net operating results for the quarter amounts to a deficit of R3,1 million (Expenses > transfers). This was however absorbed by surplus accumulated from previous quarters and donor contribution. 6

7. Summary analysis on YTD results – 31 March 2016 Transfers totalling R67, 7 million received from National Treasury at similar levels as in the previous years due to budgetary reductions. Additional income of R8 million was recoded ( Conditional grant & donations) Total expenditure was R71, 5 m or R3, 8 million in excess of the yearly allocation. Drivers of expenditure are Personnel costs (R49m or 68% of total), Travel (R5,8m), Report writing(R3,5m) and other APP related operating expenses The results (surplus of R2,1 m) were diluted by special grants and donations, otherwise the annual allocation was spent as was budgeted 7

8. 8 For the year the expenditure of R71, 5 million exceeded the annual allocation. The CGE spent all its budget for the period There has been extra-ordinary income arising from special grants and donor income – altogether at R8 million The actual spending against the annual allocation of R67, 7 million over-ran by R3, 8 m on close analysis The resulting surplus (R2,1 m) is therefore attributed to book entries made in line with GRAP23 to account for a conditional grant made by National Treasury for the purchase of assets

9. 9 Liquidity is sound with current ratio at parity Although solvency/NAV is positive at R7m by 31 March 2016, the accumulated surplus basically represents the non- current assets which will be written off as depreciation over the years. Hence with operating budget pressures and without additional funding, the solvency situation will deteriorate inevitably over the medium term

10. -Inflows and outflows from operating activities remain constant between comparative periods -R4 million invested into PPE over the past 12 months period -Cash held reducing over time and anticipated to be under pressure over the next 12 months period. 10

11. Summary analysis on YTD results – 30 June 2016 Transfers received from National Treasury amounted to R17, 5 million or 25% of the annual allocation of R69,9 million Total expenditure was R19, 9 m or R1, 5 million in excess of the quarter budget. Drivers of expenditure are Personnel costs (R13m or 65% of total), Travel (R1,6m or 8%), Professional services at 10%(R1,9m of which R1,6 m was on audit fees) and other APP related operating expenses. The results (a spending deficit of R1,6 m) for the 3 months’ period to 30 June 2016.MAR - Summary.pdfMAR - Summary.pdf 11

12. Income & Revenue for Q1-2016/2017 Total Income was R18, 4 million of which; – Transfers = R17, 5 million being 25% of the yearly baseline for 2016/17 period. – Donor funding of R751, 230 was provided for in-kind by the SABC in lieu of the free airtime on the PSA’s broadcast on various radio stations. These were themed around CGE activities during the Youth Month of June 2016 – Interest and other income = R140, 000 earned from cash held in bank + SETA discretionary grants for R37, 000 There were no outstanding income receivable, whatsoever as at 30 June 2016. All income due to the CGE was received in full during the quarter. 12

13. 13 For the quarter the expenditure of R19, 9 million exceeded the annual allocation. This spending rate of nearly a third could predict that the annual budget will be fully spent by the end of the 3 rd quarter There is a need to heighten cost containment initiatives Item Budget figures 2016/17 Actuals 2016/2017 % Q1 actual vs Annual budget Bank Charges 53 800 15 345 Compensation of Employees 50 616 900 13 007 03726% Computer Servicing, Internet & Website 564 300 258 10346% Courier Services 266 700 23 3289% Depreciation & Amortisation - 526 4170% Media Outreach 605 300 771 779128% Office Cleaning, Maintenance, Plants & Security 1 279 800 356 16728% Office Consumables 206 500 58 29028% Printing & Stationery 550 100 435 82879% Professional Services 5 024 900 1 935 21739% Report writing,Printing & Publishing 900 700 9 2691% Subscriptions 91 200 19 54521% Telecommunication Expenses 2 623 000 423 52516% Training and Development 800 000 170 00021% Travel, Accomodation and Related Expenditure 4 474 700 1 562 62135% Vehicle expenses, maint, fuel and other 1 204 800 222 91719% Venues, Catering & Event Management 628 300 133 44221% Grand Total 69 891 000 19 928 82929% Expenditure per account item - Q1 to June 2016

14. 14 Solvency remain stable with a favourable net asset position which shall inevitably shall be eroded by expected operating deficit Liquidity – current and cash ratio of 85%. No immediate challenges but the organisation must brace itself for cash flow management challenges. There are non-cash charges to income statement, contributing to the deficit. Financial position – Q1/2016-17 Balance Sheet.pdf

15. 15 Corporate Services overview Supply Chain Management Fleet Management Facilities and office accommodation

16. SCM – Demand & Acquisition Management Central Supplier Database introduced effective from 1 April 2016. Procurement plan developed at the beginning of the financial year and being implemented without exceptions so far. Notable transactions are for 20 year review (R900k), website migration and signature banners for email plus other value added services. 16

17. SCM – Acquisition Management A total of 10 formal quotations and 2 tenders were awarded in the last quarter ending 31 March 2016. The two tenders were for procurement of printing and copy editing services respectively. A panel of three service providers were appointed for provision of printing services and one service provider for copy editing services. 3 formal quotations were cancelled for none-responsiveness and exceeding the pre- bid cost estimate. Amongst the three is the CGE 20 year review bid, which has been reissued and will be finalised in the first quarter of the new financial year. 2 formal quotations are pending finalisation (Recruitment agency + Signature banners for electronic signature and related value added functions) There has not been any deviations recorded for the acquisition on any goods and services during this quarter. No irregular expenditure, whatsoever was identified/recorded during the period to date. 17

18. SCM – Performance Management Contract register reviewed during the quarter under review. Corrective action taken on all anomalies ; not only ensure compliance but effective contract management for the improved performance of the CGE business A transversal contract for the procurement (Rental) of Copier Machines for all the CGE office was entered with EOH. The contracts are negotiated and arranged by National Treasury. The fees were found to be cost effective at below R2, 000 per machine. This contract shall commence after delivery of the copiers which will be finalised during the first quarter of 2016/2017 year. 18

19. SCM – Logistics Management….2 Corporate services - Office Accommodation and fleet Management: Two provincial offices to move location – The Eastern Cape office relocated to the new premises on 19 April 2016 – The Pretoria office’s moving were postponed to 31 August 2016 to enable the provider to procure services for sub-division/partitioning and for the installation of air-conditioning. Still awaiting NDPW on developments regarding the HQ procurement instruction. The office lease was extended for 18 months since April 2015 to cover the period of procurement. The schedule overrun will be followed through during the quarterly bilateral meeting with NDPW’s Key Account Management. 19

20. SCM – Disposal Management The Commission embarked on a disposal process to release old, obsolete, redundant and unused assets. The process followed the CGE policy which provides for full representation by staff and management in the committee to achieve openness and transparency.  The project to dispose was structured into of two phases viz. Phase 1 for the selling off of damaged and obsolete assets not in use; mainly as waste and/or recycling to resellers. Most of these items were sold off during March 2016. Phase 2 for the donations of old computer equipment to institutions of learning in line with the National Treasury Regulations to that effect. Handover to coincide with planned Mandela day’s events during July of 2016 h:\Desktop\Plenary June 16\Disposal Donations Report - Q1.pdf 20

21. 2015/2016 Year end reporting and Audit Section 40 and 55 reporting period – 31 May 2016 PFMA submission due date on AFS and Pre-determined objectives. The regularity audit commenced on 9 May 2016 and was concluded by 29 July 2016. In line with section 27 of NT regulations, the Audit Committee reviewed and approved the Annual Financial Statements and the Report on performance information for the period ending 31 March 2016. 21

22. Risk Management & contingencies Identified risk treatment plans are implemented by Management and subjected to oversight by all governance Committees Notable actions implemented includes – Physical security – Biometrics access devise, smoke detector and alarm installed in the server rooms at head office – Budget – mitigated through cost control and expenditure management Emerging risks – None, whatsoever identified during period under review and/or any reassessment on existing risks was considered to adversely impacting the achievement of any objectives of the organisation. Management is not aware of any actual or potential fraudulent activities, whatsoever. No report in this regard was made to management during the period under review. 22

23. Audit Action plans All actions planned to address the audit findings by both the internal audit and AGSA were implemented in full covering the following focus areas – SCM compliance with prescripts – ICT environment weaknesses – Human Resources Management – Performance information reporting (s40) – Financial Statements (s40) – General internal control systems 23

24. 24 Thank You HAVE A GENDER RELATED COMPLAINT ???? REPORT IT TO 0800 007 709 Twitter Handle @CGEinfo Facebook: Gender Commission of South Africa

25. 25 Annexures with details Presentation to PC of Parliament 6 September 2016

26. 26 Expenditure per economic & programme classification - Q1 to June 2016 Economic classification/Programme Annual Budget 2016/17 Q1 Actuals 2016/2017 %spent COMMISSIONERS: GOVERNANCE & SUPPORT 12 022 000 2 976 65525% Compensation of Employees 9 916 300 2 386 10124% Goods & Services 2 105 700 590 55428% CORPORATE SUPPORT SERVICES 19 006 900 6 376 14034% Compensation of Employees 9 843 500 2 757 55628% Depreciation & Amortisation - 526 417(100%) Goods & Services 9 163 400 3 092 16834% SERVICE DELIVERY PROGRAM 38 862 100 10 576 03427% Compensation of Employees 30 902 100 7 863 38025% Goods & Services 7 960 000 2 712 65434% Grand Total 69 891 000 19 928 82929% Compensation of employees 50 661 900 13 007 037 As % of total72%65% COE relative % lower than budget due to vacancies Most of the spending on the SO4 due to focus on reporting and audit during the reporting period

27. 27 Expenditure per Strategic Objectives - Q1 to June 2016

28. 28 Expenditure per cost centre – Q1 to June 2016 Communications driven by PSA spending, although externally funded Finance dept., mainly due to Audit work conducted in the quarter Limpopo office – LO acting and supporting the function across provinces PEI & PLU – Travel and increase in leave provision Cost Centre Annual Budget 2016/17 Q1 Actuals 2016/2017 % spent ALL - 526 4170% CHIEF EXECUTIVE OFFICER 4 476 600 1 122 14025% COMMISSIONERS 12 022 000 2 976 65525% COMMUNICATIONS 3 554 400 1 342 35538% EASTERN CAPE 2 600 300 740 53528% FINANCE & ADMINISTRATION 8 590 200 3 530 88841% FREE STATE 2 343 100 610 56226% GAUTENG 2 258 000 631 49528% HUMAN RESOURCES 3 288 000 553 44617% INFORMATION TECHNOLOGY 2 652 100 643 25024% KWAZULU NATAL 2 417 600 440 43518% LEGAL 3 199 200 762 83124% LIMPOPO 2 452 100 816 49633% MPUMALANGA 2 779 900 798 27129% NORTH WEST 2 451 200 648 33226% NORTHERN CAPE 2 581 800 610 55724% Parliamentary Unit 1 581 200 650 11741% PUBLIC EDUCATION & INFORMATION 2 170 900 705 25132% RESEARCH 5 514 900 1 105 22720% WESTERN CAPE 2 679 300 633 44124% PEI Support 278 200 80 13029% Grand Total 69 891 000 19 928 82929%

29. 29 Other support Reports Income Statements Q1 – 2016/2017  h:\Desktop\Plenary June 16\Income statement - 3 Months to 30 June 2016.pdf–h:\Desktop\Plenary June 16\Income statement - 3 Months to 30 June 2016.pdf Income Statement Q4 – 2015/2016  h:\Desktop\Plenary June 16\Income statement - 3 Months to 31 March 2016.pdfh:\Desktop\Plenary June 16\Income statement - 3 Months to 31 March 2016.pdf Fleet management Analysis  h:\Desktop\Plenary June 16\CGE - April 2016- June 2016 Fleet Summary report.pdfh:\Desktop\Plenary June 16\CGE - April 2016- June 2016 Fleet Summary report.pdf Assets Disposal Schedule  h:\Desktop\Plenary June 16\Disposal Donations Report - Q1.pdfh:\Desktop\Plenary June 16\Disposal Donations Report - Q1.pdf Vacancies’ Costing  h:\Desktop\Plenary June 16\CGE Cost of vacancies - 30 June 2016.xlsx Vacancies’ Costing  h:\Desktop\Plenary June 16\CGE Cost of vacancies - 30 June 2016.xlsx