1. Report to the Portfolio Committee for Women in the Presidency
Financial and Related Activities for the Financial Quarter ended 30 June 2017
2017/2018 Financial Year

2. Purpose of the presentation
In accordance with provisions of the Constitution of South Africa, Act 108 of 1996 (chapter 13), The Public Finance Management Act of 1999 (as amended) – The Commission seeks to report to Parliament its financial affairs and activities for the financial year to 30 June 2017
And account for spending of the funds appropriated by parliament in terms of the Appropriation Act of 2017 as well as report on other financial management responsibilities provided for in terms of related prescripts

3. Contents Financial performance for period to 30 June 2017
Annual Budget at a glance
Analysis of income and expenditure
Financial Position as at 30 June 2017
Liquidity and solvency
Going concern implications
Other Financial Management matters ( and related BRR)
Risk management
Supply Chain management
Corporate Services
Audit and internal control systems

4. Itemised Annual Budget at a glace
The budget – less planning space – nature of the costs structure is fixed primarily.
R20,5 m (26%) of the budget spent(Q1-current) but cross-subsidised by donor funds (R1,4m from SABC)

5. Total allocation granted by NT for the year under plan is R78, 3 million from a baseline of R69,9 million in the previous FY.
The budget is a product of prioritisations against a constrained funding position.
The increase of allocation by R8, 2 million is against a depressed baseline previously subjected to budgetary cuts. The increase/injection will therefore be absorbed by price inflation on G&S expenditure and anticipated cost of living adjustment for COE.
Efficiency gains and cost savings are factored into the budget to ensure effective realisation of service delivery.

6. Statement of Financial Performance
For the current period, a surplus was generated due to Commissioner vacancies and cost savings on travel expenditure.
This surplus generating capacity will diminish in the succeeding quarters due to increased intensity in the APP implementation, in the main.
Covering some of the costs were a donation in kind by SABC – PSA at a value of R1,4 million.

7. Spending by economic classification and programme
comments
26% of the annual budget spent so far during Q1
COE remains a key driver at R13,4 m .
Other material contributors were;
Audit & legal fees – R2,3m
Travel & accomm.– R654,000
Depreciation – R490,000
Telecommunication – R435,000

8. Total spending per programme – Q1
Of the Total of R20,5 m;
69 % was incurred for activities directly determined by the legal mandate – the Constitution, CGE Act and PEPUDA ( Core-service delivery programmes)
Corporate services/Admin driven by audit fees during the period in the main and the programme accounted for 31% of the total quarterly expenditure.

9. Financial Position
Although the position is solvent and going concern assumption still valid; financial viability going forward is challenged.
The NA position is diminishing year after year and without CAPEX budget, the whole balance sheet strength will be negatively impacted in the medium term

10. Statement of Cash flow
Net cash ouflow for Q1 was R3,1 million ( mainly due to NT inflow lag of R6,5m – transfers) + pay out of performance bonus –R1m during June 2017.
Labilities figures increased by R3 million from the previous quarter hence cash balances are positive despite the constrained inflows as stated above.

11. SCM & Corporate Services
Procurement plan completed and according submitted to NT
Key Bids & acquisitions includes WAN, Insurance, Case management system, M&E tools.
Accommodation
National Department of Public Works have confirmed that the department has commenced with the procurement for:
Braamfontein – Head Office, having dealt with the previous delays experienced with the regional DPW office (GP).
Cape Town – Following extensive negotiations over the size of space allocations v DPW standard norms.
Fleet Management
Satisfactorily without any material deviation from consumption use and consumption norms:

12. Vehicle fleet utilisation

13. Audit & Risk Management - Action Plans
During the quarter under review, risk assessment workshop was conducted amongst representative management, Provincial Coordinators and other key staff. Furthermore, a committee meeting exercised oversight & review of the Risk Register.
A final Risk Register for the 2017/2018 was adopted and applied (IRM) to ensure that organisational objectives are achieved through effective mitigation strategies. .
Significant 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.
Audit issues
The Commission continues to implement Action Plans agreed to from all previous audits and the internal audit function of the CGE.

14. Year end and Audit updates
The regularity audit by AGSA concluded and audit report considered by the Audit Committee on 28 July Outcomes reportable with Annual report (prohibition of publication by PFMA at this stage until tabled with parliament)
AR on AoPO (Audit of Performance Outcome) and AFS to be tabled in Parliament by the latest 30 September2017 as is required by the PFMA

15. Critical s38, 39 & 40 imperatives
Budget issues
Financial Management issues
Spending contained albeit with challenges.
There are cost containment strategies and measures in place. However, without space to contain or sustain operations in the near-term.
Q1 surplus result is not expected to replicate in future quarters but pressures will be experienced – filling of Commissioners vacancies, intensified roll-out of the approved APP.
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

16. Other PFMA and miscellaneous issues
Fraud and irregularities
Except for the allegations levelled against some members of SMS, there are no fraud incidences reported or known to management, whatsoever.
Litigation and contingencies
Double payment of June 2017 salaries resulting in PFMA, IR, Finance and other legal implications where dealt with during the latter part of the quarter.
A dispute/claim was lodged at the Labour Court against the CGE by one of the employees affected by the decision of the CGE to withhold the July salary in order to defray the double payment made in June.

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