2017 ANNUAL REPORT - Boland College · The accounting officer’s foreword Statement of responsibility and ... Boland College continued to provide academic support programmes for

2017ANNUALREPORTB O L A N D T V E TC O L L E G E

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Message from the council chairpersonThe accounting officer’s forewordStatement of responsibility and confirmation of accuracyLegislation and other directives- Legislative framework- Legislative and other mandates

GENERAL OVERVIEWA

G O V E R N A N C E

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Report of the council chairperson- Constitution of the college council and governance structures- Report of the council on risk assessment and management of risks- Reports by committees of council- Academic board report- Student representative council report

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Report by the principal on management and administration - High-level organisational structureCollege performance and Organisational environmentPerformance reportingPerformance reportingAnnual performance achievementsCollege achievement in terms of TVET system targetsStrategy to deal with underperformance

P E R F O R M A N C E I N F O R M A T I O NC

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Financial reportingRequired attachments for financial reporting

F I N A N C I A L I N F O R M A T I O ND

03Abbreviations and acronyms1

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AET Adult Education and TrainingAPP Annual Performance PlanCBMT Competency Based Modular TrainingCET Continuing Education and TrainingCET Act Continuing Education and Training ActCHEC Cape Higher Education ConsortiumCOS Centre of SpecialisationCDW Community Development WorkersDEDAT Department of Economic Development and TourismDHET Department of Higher Education and TrainingDP Deputy PrincipalE&A Examination and AssessmentETQA Education and Training Quality AssuranceVP Vice PrincipalGETC General Education and Training CertificateGRAP Generally Recognised Accounting PracticeHE Higher EducationHRDS-SA Human Resource Development Strategy for South AfricaIEC Independent Electoral Commission of South AfricaICT Information Communication TechnologyIDP Integrated Development PlansM&E Monitoring and EvaluationMIS Management Information SystemMOA Memorandum of AgreementMOU Memorandum of UnderstandingMTEF Medium Term Expenditure FrameworkMTSF Medium Term Strategic FrameworkNAPTOSA National Professional Teacher’s Organisation of South AfricaNC(V) National Certificate (Vocational) qualification at NQF levels 2-4

A B B R E V I A T I O N S A N D A C R O N Y M S01

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NDP National Development PlanNEET Not in employment nor in education and training (youth)NEHAWU National Education Health and Allied Workers UnionNGO Non-government organisationNPO Non-profit organisationNQF National Qualifications FrameworkNSDS National Skills Development StrategyNSF National Skills FundNSFAS National Student Financial Aid SchemeOPS Plan Operational PlanOLC Open Learning CentresPICC Presidential Infrastructure Coordinating CommissionPQM Programme Qualification MixPSA Public Service Association of South AfricaPSET Post-School Education and TrainingQCTO Quality Council for Trades and OccupationsQMS Quality Management System SABS South African Bureau of StandardsSADTU South African Democratic Teachers UnionSAQA South African Qualifications AuthoritySETA Sector Education and Training AuthoritySNE Special Needs EducationSO Strategic ObjectiveSP Strategic PlanSSP Sector Skills PlanSWOT Strengths, weaknesses, opportunities, threatsTVET Technical and Vocational Education and TrainingUMALUSI Council for Quality Assurance in General and Further Education and TrainingVP Vice Principal WCED Western Cape Education DepartmentWIL Work Integrated LearningWPBL Workplace-based Learning

04

Boland College entered a period of transition with the retirement of the principal, Mrs Corrie Myburgh in June 2017. Mrs Myburgh managed the College with distinction for more than five years and made a huge contribution to the TVET college sector in a career of nearly 40 years.

While the Department of Higher Education & Training’s process of appointing a new principal has dragged on and was still unresolved at year end, the College has been fortunate to have the services of its Chief Financial Officer, Mr Hannes Gelderblom, as acting principal. Mr Gelderblom’s wide experience and his calm but firm management style have been of great benefit to the College.

It became clear during 2017 that there is a large gap between the policy and intentions of the DHET with regard to the TVET sector and the practical implementation of its plans. This lacuna has placed Boland College under severe financial stress.

The White Paper for Post-School Education and Training of 2013 puts an expanded TVET college sector at the heart of government plans for an integrated post-school education and training system that can “assist in building a fair, equitable, non-racial, non-sexist and democratic South Africa”.

“The DHET’s highest priority is to strengthen and expand the public TVET colleges and turn them into attractive institutions of choice for school leavers.” (White Paper, p xii)

Unfortunately, adequate funding has not followed the rhetoric. The level of government subsidies for TVET colleges remains inadequate for them to fulfil their mandate.

Another problem, with a serious impact on the College’s cash flow, has been the technical challenges that led to late or non-payments by the National Student Financial Aid Scheme (NSFAS) to the College.

The Council is grateful to management for the proactive steps taken to curb expenditure, including a tight rein on appointments and reduction of the Council payroll, the letting of College residences to third parties, and its reluctant withdrawal from the administration of the Anene Booysen Skills Centre in Bredasdorp. Management has also been pro-active in its efforts to curb water consumption at all campuses during the on-going water crisis.

GENERALOVERVIEW

M E S S A G E F R O M T H EC O U N C I L C H A I R P E R S O N02

A

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Council was disappointed that the College received a qualified opinion from the Auditor General for the 2017 audit. The qualification relates to mis-allocation of some furniture and fittings in the asset register.

The College appreciates the efforts of the Auditor General in identifying the problem and assisting management in resolving it. Management has a plan in place to deal with all issues raised during the audit and Council is confident that Boland College will soon return to clean audit status.

The College is to be congratulated on its excellent academic results in 2017 and for being selected as a Centre of Specialisation for welding at the Worcester Campus.

The Council applauds the academic and support staff of Boland College for their unwavering dedication to the education of our young people. They live out the vision and mission of the College every day and thereby contribute to a brighter future for our students and the broader community.

DAVID BLEAZARD // Council Chairperson

30 May 2018

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The annual report of 2017 provides a welcome opportunity to look back with sincere gratitude on what the College was able to achieve, even though faced with numerous challenges. The following specific priority areas were identified to ensure more effective and efficient teaching and learning in 2017:

Growth and expansion of access and articulation opportunities for the youth

It is the vision of Boland College to grow and expand access in Artisan Development. The College applied for and was awarded the opportunity to establish a Centre of Specialisation (CoS) for Welding at the Worcester campus. The main aim of the CoS is to deliver more efficiently and effectively on 30 well qualified welding artisans. The College was able to comply with all requirements for the preparation phase in 2017 and was prepared for the next phase to follow in 2018.

Improvement of quality and success in terms of the academic achievement and certification of students

Boland College continued to provide academic support programmes for all students, which included mentoring and tutoring processes, focusing on fundamental subjects. The investment in academic support resulted in the College proudly being awarded a national award for its performance in presenting National Certificate (Vocational) programmes.

Job readiness programmes were offered to all qualifying students. The College placed lecturers in the workplace to gain work integrated learning.

Partnerships and linkages with industry, SETA(s) and/or other professional bodies to adequately prepare student graduates to enter the labour market

Boland College maintained sound relationships with SETAs such as Merseta, Chieta, EW Seta and CETA for the funding of artisan development. Many other SETAs contributed funding to occupational projects of Boland College and also assisted the College with funding for placement of students.

Institutional governance, management and leadership

The College Council was fully functional and ensured good governance of Boland College. The vacancy for a Council member with legal expertise was filled in 2017. The College was fortunate to have sound and effective structures for its governance and management.

03 T H E A C C O U N T I N G O F F I C E R ’ S F O R E W O R D

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This was confirmed at a national level when Boland College received an award for having a clean audit after being audited by the Auditor General for the first time.

Monitoring and evaluation of college performance

Each Vice-Principal had to report on the performance of his/her division at various forums. The College allocated the responsibility for compilation of ad-hoc reports to DHET to a relevant departmental manager.

Green Initiative

The College Green Initiative was well managed. The continuous process of Re-use, Reduce and Recycle was well integrated in all processes and 8 tons of material was recycled. The serious drought in the Western Cape also affected the College and initiatives were implemented that resulted in a 65% decrease in water consumption in 2017.

IJ GELDERBLOM // Acting Principal

30 May 2018

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04 S T A T E M E N T O F R E S P O N S I B I L I T Y A N D C O N F I R M A T I O N O F A C C U R A C Y

To the best of my knowledge and belief, I confirm the following:

All information and amounts disclosed throughout this annual report are consistent.

The annual report has been prepared in accord-ance with the guidelines issued by the Depart-ment of Higher Education and Training.

The annual financial statements have been pre-pared in accordance with the relevant standards, frameworks and guidelines issued by National Treasury.

The accounting officer, is responsible for the prep-aration of the annual financial statements and for the judgements made in this document.

The accounting officer is responsible for establish-ing and implementing a system of internal control that has been designed to provide reasonable assurance as to the integrity and reliability of the performance information, the human resources information and the annual financial statements.

The Auditor-General and/or external auditors express an independent opinion on the annual financial statements.

IJ GELDERBLOM // Acting Principal

30 May 2018

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05 L E G I S L A T I O N A N D O T H E R D I R E C T I V E S

Boland College is enjoined by Section 44(3) of the Act, read in conjunction with section 25(3) of the same Act, to prepare and submit an annual report to the Minister for Higher Education and Training.

In terms of Sections 25(3) and 25(4) of the Continuing Education and Training (CET) Colleges Act, No 16 of 2006 (as amended), public technical and vocational education and training (TVET) colleges are required to produce annual financial reports and to comply with any reasonable additional reporting requirement established by the Minister. Moreover, Section 44 of the Act requires colleges to annually report to the Minister in respect of their performance and their use of available resources.

In addition, these pieces of legislation govern and steer the College in terms of achievement of its strategic and performance objectives.

Further sets of legislation that impact on the TVET colleges sector and its strategic and national imperatives are listed below:

- Continuing Education and Training Act (No 16 of 2006

as amended)

- National Qualifications Framework (NQF) Act

(No 67 of 2008)

- Higher Education (HE) Act (No 101 of 1997)

- Skills Development Act (No 97 of 1998)

- Skills Development Levies Act (no 9 of 1999)

- General and Further Education and Training Quality

Assurance Act (No 58 of 2001)

- The Public Financial Management Act (1999)

(Act No 1 of 1999) and Treasury Regulations (2005)

(as amended)

- The Preferential Procurement Policy Framework Act

(2000) (Act no 5 of 2000) and Regulations (2001)

(as amended)

- The Employment Equity Act (1998) (Act no 55 of 1998)

(as amended)

- T he Basic Conditions of Employment Act (1997)

(Act no 75 of 1997) (as amended)

- The Labour Relations Act (Act no 66 of 1955)

(as amended)

- Occupational Health and Safety Act (Act no 85

of 1993) (as amended)

- Skills Development Act (as amended)

- Protected Disclosure Act 2000 (Act no 26 of 2000) and

- Promotion of Access to Information Act 2000 (Act no 2

of 2000) and the Promotion of Administrative Justice

Act 2000 (Act no 3 of 2000).

In addition, the White Paper for Post-School Education and Training mandates delivery and strategic priorities in the TVET colleges sector.

5.1 L E G I S L A T I V E F R A M E W O R K 5.2 L E G I S L A T I V E A N D

O T H E R M A N DA T E S

The Constitution of the Republic of South Africa (Section 29(1)-(4)) provides for the right of basic and further education to everyone in the official language of their choice provided equity, redress and practicability are taken into account. In addition, the Continuing Education and Training (CET) Colleges Act (No 16 of 2006) provides for the regulation of continuing and further education and training through the establishment, governance and funding of public technical and vocational education and training (TVET) colleges and the promotion of quality in continuing and further education and training.

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Names of Council chairperson and members, as well as their designated functions are listed below:

Appointments made in the year in terms of sections 10(4) and 10(6) of the CET Act;

Adv Mandla Mdludlu was appointed on 6 September 2017 in terms of Section 10(6) of the CET Act

6.1 C O N S T I T U T I O N O F T H E C O L L E G E C O U N C I L A N D G O V E R N A N C E S T R U C T U R E S

COLLEGE COUNCIL// Bakker, J (Support Staff Representative until 31-10-2017)

// Bleazard, DK (Chairperson) // Cloete, HCA

// Dladla, ZP (SRC President until 02-08-2017)

// Gelderblom, IJ (Acting Principal from 01-07-2017)

// Kabanyane, GC // Lingela, TS (Vice Chairperson)

// MacMaster, LLM // Matolengwe, N // Myburgh, EC

(Principal until 30-06-2017) // Mdludlu, M (from 06-09-2017)

// Peters, E (VP: E&T) // Pieterse, I (SRC President from

02-08-2017) // Pietersen, VRF // Plaatjies, D (Educator

Staff Representative) // V d Merwe, HA // Van Louw, CLPLANNING & RESOURCES COMMITTEE// Bleazard, DK (Chairperson)

// Myburgh, EC (until 30-06-2017) // Plaatjies, D

// Coetzee, JJM // Venter, A // Maree, A

// Gelderblom, IJ (from 01-07-2017)

HUMAN RESOURCES COMMITTEE// Bakker, J (until 31-10-2017) // Bleazard, DK

// Saal, J // Cloete, HCA // Coetzee, JJM

// Gelderblom, IJ (from 01-07-2017) // Matolengwe, N

// Myburgh, EC (until 30-06-2017) // Plaatjies, D

// Van Louw, CL (Chairperson)

AUDIT & RISK COMMITTEE// Cloete, HCA // Burton, MR (external member from

28-09-2017) // V d Merwe, HA (Chairperson)

FINANCIAL COMMITTEE// Bakker, J (until 31-10-2017) // Bleazard, DK

// Gelderblom, IJ (from 01-07-2017) // Mackriel, M

// Neal, CR // Myburgh, EC (until 30-06-2017)

// V d Merwe, HA (Chairperson)

BGOVERNANCE

R E P O R T O F T H E C O U N C I L C H A I R P E R S O N06

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Number of meetings held:

C O L L E G E C O U N C I L

30 March 2017 // 14 June 2017 // 28 September 2017

// 1 December 2017

Special meetings

3 August 2017

A U D I T & R I S K C O M M I T T E E

2 March 2017 // 14 June 2017 // 30 August 2017

// 27 October 2017

Special meetings

29 March 2017 // 3 August 2017

F I N A N C I A L C O M M I T T E E

2 March 2017 // 14 June 2017 // 28 September 2017

// 1 December 2017

P L A N N I N G & R E S O U R C E S C O M M I T T E E

6 March 2017 // 1 May 2017 // 6 September 2017

// 1 November 2017

H U M A N R E S O U R C E S C O M M I T T E E

8 March 2017 // 24 May 2017 // 23 August 2017

// 18 October 2017

Performance in terms of its statutory functions, explained in Section 10(1)-(3) of the CET Act.

Boland College had a fully functional College Council in 2017. Four general and one special Council meetings were held. The Committees of the Council: Finance, Audit and Risk, Human Resources and Planning and Resources met at least once a term and in doing so rendered support to the College management to achieve the goals of Boland College.

The Boland College Council performed all its functions, including the review of the Standard Statute, which are necessary to govern a public college, subject to the Act and any applicable national or provincial law.

The Council, with the concurrence of the Academic Board, developed a strategic plan for the College that:

- incorporates the mission, vision, goals and planning for funding of the College;

- addresses past imbalances as well as gender and disability matters;

- adheres to safety measures for a safe learning environment for students, lecturers and support staff approved by the Minister;

- determines the language policy of the public College, subject to the approval of the Minister;

- ensures that the College complies with accreditation requirements necessary to provide learning programmes in terms of standards and qualifications as registered in the National Qualifications Framework.

The Council, after consultation with the Student Representative Council, makes provision for a suitable structure to advise on policy for student support services within the College.

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B O L A N D C O L L E G E R I S KM A N A G E M E N T S T R A T E G Y

- Boland College had a fully established and functional enterprise-wide risk management process within the College. The Risk Management Committee oversaw the risk process. A risk plan was loaded on the QMS for easy access and utilisation by all staff.

- Each Vice-Principal was responsible for the management of risks in her/his portfolio. It was their responsibility to discuss the risks of the various departments at their meetings and they were also responsible to continually assess the risks and develop mitigation measures.

- The top strategic risks were tabled at each Risk Management Committee meeting for discussion.

6.2 R E P O R T O F T H E C O U N C I L O N R I S K A S S E S S M E N T A N D M A N A G E M E N T O F R I S K S

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- The Boland College Risk Management Policy is in line with the requirements of the King Code on Corporate Governance for South Africa 2009 (King III).

- An annual risk assessment was conducted. The Risk Register was discussed and updated in its entirety. New risks were identified, existing risks were amended, and risk and control ratings together with risk responses, were updated.

- The chairperson of the Audit and Risk Committee discussed identified strategic and operational risks at Council meetings.

The risks Boland College had to contend with were managed in a structured manner in 2017.

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In-Year Management and Monthly/Quarterly Report

The College reported to DHET every month regarding the status of the income and expenditure. The Audit and Risk Committee was satisfied with the current content and quality of the quarterly financial and performance reports prepared and issued by the Accounting Officer of the College during the year under review.

Evaluation of Financial Statements

The Audit and Risk Committee has:

- Reviewed and discussed the audited annual financial statements as presented in the annual report

- Reviewed the External auditor management report and management’s responses thereto

- Considered changes to the accounting policies and practices and where applicable, ensured that these were reported in the annual financial statements

6 . 3 . 1 A U D I T C O M M I T T E E

We are pleased to present our report for the financial year ended December 2017.

Audit and Risk Committee Responsibility

The Audit and Risk Committee complied with its responsibilities arising from Section 25 (1) (c) of the Continuing Education and Training Act, Act 16 of 2006 as amended by “implementing internal audit and risk management systems which are not inferior to the standards contained in the Public Finance Management Act, 1999 (Act 1 of 1999)” and Generally Recognised Accounting Practices (GRAP). The Audit and Risk Committee has updated its Audit and Risk Charter, has regulated its affairs in compliance with the Charter and has discharged all its responsibilities as contained therein.

The Effectiveness of Internal Control

We reviewed the results of internal audit engagements, which were based on the risk assessments conducted in the College.

During 2017 the implementation of audit action plans were prioritised and monitored on a regular basis and corrective actions were taken timeously where insufficient progress had been made. The audit action plans were based on external audit findings of the College, the Auditor General’s findings as provided by DHET, internal audit findings and risks according to the Risk Register.

6.3 R E P O R T S B Y C O M M I T T E E S O F T H E C O U N C I L

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Internal Audit

The Internal audit function was in general vacant and limited use of consultants was made in the latter part of the year who furnished one report on occupational service delivery. The Audit and Risk Committee continued to monitor the implementation of agreed actions on an ongoing basis. The Audit and Risk Committee remains concerned about the adequacy of internal audit resources to ensure complete coverage of high risk areas. The combined assurance approach will continue to be applied to effectively focus on limited internal audit resources.

Risk Management

The College has taken responsibility and ownership for the implementation of the Enterprise Risk Management (ERM) methodology and function, and the process is reviewed on a quarterly basis by the Audit and Risk Committee.

External Auditor’s Report

We have reviewed the College’s implementation plan for audit issues raised in the 2016 financial year and we are satisfied that the matters have been addressed as reported by the External Auditor. The Audit and Risk Committee has met with the College to ensure that there are no unresolved issues emanating from the regulatory audit.

The Audit and Risk Committee concurs and accepts the conclusions of the External Auditor on the annual financial statements.

Appreciation

The Audit and Risk Committee wishes to express its appreciation to the Management of the College in a tough and challenging year, and for the co-operation and information they provided to enable the committee to fulfil its mandate and to compile this report.

HA VAN DER MERWE // Audit and Risk Committee Chairperson

30 May 2018

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6 . 3 . 2 F I N A N C E C O M M I T T E E

The Financial Committee was fully constituted and chaired by an external Council member. Four quarterly meetings were held. The Committee oversaw and approved College budget submissions, deviations and quarterly revisions to ensure that the required outputs were specific and consistent with the desired outcomes. The committee also had serious challenges during the 2017 financial year. It was a break-even year in many respects. Cash flow-wise it was a deficit year. The slow inflow of government funds made it extremely difficult to manage finances. We do not expect the situation to improve in 2018. The College has no reserves to fall back on and this subsequently caused financial stress. We can, however, proudly state that the College management has done an outstanding job in spite of these challenges.

6 . 3 . 3 H U M A N R E S O U R C E S C O M M I T T E E

The Human Resources Committee oversees the conditions of employment of Boland College appointed staff. Both the chairperson and vice-chairperson are external members of Council, in compliance with the CET Act. The Committee met quarterly and meetings were well attended. Policies received from the Department of Higher Education and Training were perused and recommended to Council for adoption. The functions of the Committee included the recommendation of employment of Council staff members and recommending termination of services of Council staff members relating to dismissal cases such as misconduct, incapacity and operational requirements (retrenchments). Moreover, the Committee also reviewed strategic goals, objectives and action plans with regard to the management of human resources and recommended to the Council proposals with regard to incentive programmes and recognition of staff (Excellence and Long Service Awards). The HR Committee also recommended approval of applications received for conducting private work and reviewed the employment equity targets and affirmative action meas-ures of Boland College.

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6 . 3 . 4 P L A N N I N G A N D R E S O U R C E C O M M I T T E E

The Planning and Resource Committee met quarterly. Three external Council members were members of the Committee. All physical resources and information communication technology matters were discussed by the Committee. These included full plans and progress on infrastructure projects, as well as five year planning for infrastructure needs. The terms of reference were in line with the DHET policy. The scope of the Committee was extended to “perform such duties as the College Council may from time to time delegate to it and to assist Council and Management in the planning, monitoring and evaluation of the College’s strategic plan and evaluation of infrastructure and ICT resources”. A Disaster Recovery Plan was developed and is ready for implementation in the case of a disaster. The PLANCO fulfils an overarching ITC Governance role.

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The functions and powers of the Academic Board are set out in the Continuing Education and Training Act, No: 16 of 2006 (as amended). The Boland College Academic Board was reconstituted in 2017 in terms of the revised Terms of Reference of the Academic Board which were approved by the College Council in 2016.

The Academic Board remains accountable to the Council for:

- All teaching, learning, research and academic functions of the College;

- Promoting the participation of women and the disabled in its learning programmes;

- Establishing internal academic monitoring and quality promotion mechanisms;

- Ensuring that the requirements of accreditation to provide learning in accordance with standards and qualifications registered in the National Qualifications Framework are met;

- Performing such other functions as may be delegated or assigned to it by the Council.

- The planning, organisation and supervision of programme delivery and examinations. · Advising the Council on a student code of

conduct and rules · Advising the Council on the conditions

applicable to any scholarships/financial aid.

- The establishment of any committees;

- Advising the Council on student admission requirements;

- Reporting to the Council on reports, research projects and recommendations;

The Academic Board does not have decision making authority, but submitted Board recommendations for approval to the Council.

The Academic Board of Boland College consisted of:

- The Principal- The Vice-Principals of Education and Training and Innovation and Development- External Members of Council (at least 3)- Campus Managers- Senior Academic Manager- Heads of Departments- Programme Managers- Lecturing Staff- Members of the Student Representative Council- Lecturing Staff represented on the Council- Quality Manager- Student Support Manager

The Academic Board meetings

- The Principal is the chairperson of the Academic Board who ensured that four meetings per annum were held in 2017.

- The input of the Council members, academic staff and student representatives contributed to the success of the deliberations during the meetings.

- The Vice-Principal: Education and Training reported achievements and challenges with regard to education and training at each meeting.

- The Vice-Principal: Innovation and Development reported on student support services which include reports on work integrated learning, partnerships and the Student Representative Council.

6.4 A C A D E M I CB OA R D R E P O R T

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In line with the CET Act, students had representation on all Boland TVET College governance structures. As an institution, Boland TVET College recognises and values our Student Representative Council as the umbrella representative body of students.

The approach of Boland TVET College to student development leadership initiatives is unique. Rather than focusing on development initiatives at the start of the term of office for student leaders, the student leadership development initiatives focus on providing student leaders with support throughout their term of office. Boland TVET College holds the firm view that student leadership development initiatives are important in providing student leaders with the necessary support and skills for effective leadership that is relevant to the current context, as well as inclusive in approach. Student leadership development not only assists student leaders through an experiential approach that is grounded in a theoretical framework, but it also communicates to student leaders that they are valued, appreciated and considered integral to the governing structures at Boland TVET College.

The Student Representative Council was well prepared at the start of 2017 to be of service to prospective and returning students during the registration period. All five Boland College campuses reported that the first week of registration was positive with a large number of prospective students who showed up for both registration and new bursary applications.

It was the first time Boland TVET College made use of the NSFAS online application process. A huge number of new and senior students were already assisted towards the end of 2016 with registering on the MyNsfas online portal. Despite ongoing challenges the Financial Aid Department was able to assist students in a very efficient manner, ensuring that all students who qualified for financial assistance were supported during the application process.

The Welcoming and Orientation programme for new students was a major success on all campuses. It helped to familiarise students with their new environment. Although there were fun and games galore, this played a vital role in building cohesion in order for them to work together and build interpersonal communication with their classmates. We are hopeful that this experience will be transferred to the learning environment.

The OLCs on the five campuses were accessible for all students to use. Fixed term contract OLC officials have been appointed on all campuses. Each OLC was open during business hours. Students have access to computers and the internet at the OLC for the need of doing their work on a daily basis. It also serves as a constructive learning environment for students. It is evident from the number of students that visit the OLC on a daily basis that this service is much needed.

The academic support periods were implemented across campuses. These additional support periods were conducted within the academic timetable and for English and Maths, specifically. It was evident from student feedback that this academic support has been of great value. Most campuses also offered additional student support with computer practicals.

6.5 S T U D E N T R E P R E S E N T A T I V E C O U N C I L R E P O R T

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“Education is the most powerful weapon which you can use to change the world.”

- Nelson Mandela

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The SRCs of the various campuses make use of a Student Parliament not only to attend to student issues, but to also inform all students about matters which concern them.

Boland TVET College acknowledges the importance of structured mass participation in extra- curricular activities (sports, arts and culture) and strives to create opportunities for holistic development of students. In 2017 the following events took place across campuses, provincially and nationally involving the other TVET colleges: Athletics both at provincial and national level, the Provincial Choir Festival and the National Ball Games that took place from 1-5 October 2017 at Hottentots Holland High School in Somerset West. TVET colleges from eight provinces competed in various sporting codes.

As we diligently invested in the development of our student leaders, various documents and processes were developed with inputs from broad management and student leaders for implementation. With the guidance of a professional consultant, the approach to their training was to promote dialogue which encourages different perspectives and opinions. Together with the SRC Central Executive Committee, their constitution and the guidelines to carry out SRC responsibilities according to each portfolio were reviewed. Some changes were made in order to fit the needs of our SRC on the various campuses.

The election process of the SRC for 2017/18 started in May 2017 with the opening of nominations. IEC trained officials, ensuring that the election of the Student Representative Council (SRC) was fair, transparent and done in a democratic manner, conducted all elections. The election of the new SRC members was able to take place without any disruption in August 2017.

The newly elected SRC members attended a training camp at the beginning of February 2018. Topics covered included the mandate of the SRC, the CET Act, effective leadership, communication with management, project and time management. The successful Inauguration of the SRC 2017/’18 took place in October 2017 at the Stellenbosch campus. On this occasion, the newly elected student leaders signed their Code of Conduct and received their official SRC blazers.

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CPERFORMANCE INFORMATION

07 R E P O R T F R O M T H E P R I N C I PA L O N M A N A G E M E N T A N D A D M I N I S T R A T I O N

The year 2017 saw the loss of a wealth of institutional memory with the retirement of both experienced Administrative and Educator staff, especially the retirement of the Chief Risk Officer, Ms H Fourie on 30 April 2017 and the Principal, Ms C Myburgh on 30 June 2017. These changes had implications for Management and Administration. The CFO was appointed as Acting Principal and the Senior Manager Finance was appointed as Acting CFO. The Vice Principal: Corporate Services handed over the Residence Food Services to the Vice Principal: Innovation and Development and added Risk Management and Quality Management to

the portfolio of Corporate Services. It is a pleasure to say that, despite the understaffing in Senior Management, all functions were still performed at a high level of service delivery. Filling vacant posts for the core business of the College, Education and Training, fortunately posted no real challenges, but filling administrative posts in critical fields, rendered no success by the end of 2017. These include an ICT Systems Manager, Risk Officer and Labour Relations Officer. Recruitment processes will continue in 2018. It is therefore remarkable that all administrative and management performance goals were met.

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H I G H - L E V E L O R G A N I S A T I O N A L S T R U C T U R E P R I N C I PA L ( A C T I N G )

I J G E L D E R B L O M

V I C E P R I N C I PA L

E D U C A T I O N & T R A I N I N G

// E P E T E R S

S E N I O R M A N A G E R

E D U C A T I O N

& T R A I N I N G //

S R A U B E N H E I M E R


I N T E R N A L A U D I T

& R I S K // H J F O U R I E

( U N T I L 3 0 A P R I L 2 0 1 7 )


A S S E T S & P R O C U R E M E N T

// C R N E A L

C A M P U S M A N A G E R S

C A L E D O N // S S I E B E R H A G E N

PA A R L // I H A R T M A N

S T E L L E N B O S C H // N M PAT I

S T R A N D // D P L A AT J I E S

W O R C E S T E R // C C O R D I E R


I N N O VA T I O N & D E V E L O P M E N T

// W A D A M S


F I N A N C E ( A C T I N G )

// C R N E A L


C O R P O R A T E S E R V I C E S

// J J M C O E T Z E E

S T A F F E S T A B L I S H M E N T( A S A T 3 1 D E C E M B E R 2 0 1 7 )

247Support staff

01Principal (Vacant) 04 Vice

Principals

Principal and Senior Manager Internal Audit and Risk

02 Vacant posts

02 ActingPositionsPrincipal and CFO

429Total

Lecturing staff176

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The management of the College considers having clear strategic direction objectives, and sufficient resources, as imperative for an environment to achieve optimal performance. For all plans, irrespective of whether they are strategic or operational, the Plan-Do-Check-Improve formula is used. Governance and management structures are key to the achievement of strategic goals and operational targets. To this end the College Management has reviewed the organograms in 2017 to ensure that human resources are optimally utilised to achieve a high level of College performance. Quarterly measurement and reporting on the achievement of targets ensures that all efforts to perform and deliver are aligned and on track.

08 C O L L E G E P E R F O R M A N C E A N D O R G A N I S A T I O N A L E N V I R O N M E N T

2 0 1 4 - 2 0 1 8 H E A D C O U N T T R E N DA L L P R O G R A M M E S

P R O G R A M M E 2 0 1 4 2 0 1 5 2 0 1 6 2 0 1 7

NC(V) L2 - L4 1 834 2 053 1 821 1 469

Eng. N1 -N3 618 604 628 676

Eng. N4 - N6 66

Bus. N4 - N6 4 662 4 987 5 408 5 359

Occupational 3 455 3 100 3 747 2 890

TOTALS 10 569 10 744 11 604 10 460

The College is fortunate to have an experienced core of Council members, especially qualified professionals from the Audit and Legal Sector. The experienced Chairperson of the College Council ensured that Council members were aware of their roles and responsibilities and also equipped to perform their functions well. Moreover, the College had well established management structures, all with applicable terms of reference that ensured that focused meetings took place at regular times. Reporting was continuous and of high calibre. The Council provided strategic direction and the management of the College reported on implementation, progress and performance. The enterprise-wide Risk Management Process and the Quality Management System continuously provided the necessary tools to monitor, evaluate and improve.

9.2.1 Enrolment Performance (headcounts)

All enrolments in terms of headcounts declined from 2016 to 2017, except for the Report 191, Engineering Studies N1-N6 where there was a total increase of 114. This is attributed to the fact that Boland College for the first time introduced N4 – N6 Electrical Engineering Studies at Strand Campus. The overall decrease in enrolment was 1 144 which was distributed as follows:

The assumption was made that the large decline in NC (V) could be attributed to the fact that more potential students that would qualify to enter at level 2, remained at schools where there is no need generally to qualify for bursaries or to sit for national examinations at the levels of grades 10 and 11 (equivalent of Levels 2 and 3), nor to meet the stringent pass requirements of the NC(V) programmes.

The College continued to grow in both the N1 – N6 Engineering programmes, as well as taking on more occupational artisanal students.

09 P E R F O R M A N C ER E P O R T I N G

9.2

9.1

S T R A T E G I C O B J E C T I V E 2 : T O I N C R E A S E A C C E S S A N D P R O V I D E E F F E C T I V E S E R V I C E S T O S T U D E N T S

S T R A T E G I C O B J E C T I V E 1 : T O S T R E N G T H E N G O V E R N A N C E , M A N A G E M E N T A N D L E A D E R S H I P

25

A N A LY S I S 2 0 1 4 - 2 0 1 7 N C ( V ) E X A M I N AT I O N R E S U L T S

L e v e l s

S u b j e c t P a s s R a t e s R e t e n t i o n R a t e C e r t i f i c a t i o n R a t e

2 0 1 4 2 0 1 5 2 0 1 6 2 0 1 7 2 0 1 4 2 0 1 5 2 0 1 6 2 0 1 7 2 0 1 4 2 0 1 5 2 0 1 6 2 0 1 7

Level 2 81% 86% 88% 94% 71% 63% 54% 55% 31% 32% 26% 33%

Level 3 86% 82% 86% 94% 79% 79% 82% 82% 31% 25% 27% 48%

Level 4 91% 92% 90% 90% 91% 88% 89% 92% 44% 45% 41% 50%

The following are some of the achievements:

9.2.2 NC(V)

The table below provides an analysis of the Levels 2 – 4 examination results in terms of subject pass

and retention rates, as well as the certification rates on each level of the NC (V) programme.

From the table:

- The Level 2 subject pass rate increased from 88% in 2016 to 94% in 2017. Both the retention and certification rates improved. Although the retention rate attained is below the target, the improvement on the 2016 performance can be attributed to more students complying with the DHET examination admission requirements in terms of attendance and that of the sub-minimum Internal Continuous Assessment (ICASS).

- The Level 3 subject pass rate increased from 86% in 2016 to 94% in 2017, whilst the retention rate was maintained at 82% over the same period. There was a significant increase in the level 3 certification rate, from 27% in 2016 to 48%

in 2017.

- The Level 4 retention rate increased from 89% in 2016 to 92% in 2017 and the certification rate increased by 9%.

- The College was acknowledged by the DHET and the Association of College Governing Councils for achieving the 2nd best results in the country in the NC(V) programme in the previous year.

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From the table:

- N1, N2 and N3 subjects pass rates improved respectively from 90%, 59% and 65% in 2016 to 94%, 66% and 66% in 2017.

- The N1 and N2 retention rates improved respectively from 70% and 67% in 2016 to 73% and 79% in 2017.

- Similarly the N1 and N2 certification rates improved respectively from 41% and 18% in 2016 to 46% and 26% in 2017.

- The N3 retention and certification rates showed a decline.

- There were no previous results for the N4 – N6 Engineering programmes to compare with, due to these levels being offered for the first time in 2016. The 2017 subject pass and retention rates appeared promising, but it is obvious that much more attention must be given to the improvement of the certification rates on all 3 levels, but more particularly at the levels of N5 and N6.

A N A LY S I S 2 0 1 4 - 2 0 1 7 N 1 – N 6 E N G I N E E R I N G E X A M I N AT I O N R E S U L T S

L e v e l s


2 0 1 4 2 0 1 5 2 0 1 6 2 0 1 7 2 0 1 4 2 0 1 5 2 0 1 6 2 0 1 7 2 0 1 4 2 0 1 5 2 0 1 6 2 0 1 7

N1 71% 82% 90% 94% 74% 75% 70% 73% 33% 43% 41% 46%

N2 56% 34% 59% 66% 88% 88% 67% 79% 19% 13% 18% 26%

N3 43% 59% 65% 66% 88% 86% 89% 84% 16% 15% 31% 23%

N4 84% 84% 44%

N5 70% 92% 21%

N6 50% 90% 8%

9.2.3 N1 – N6 Engineering Studies Examination Results

The table below provides an analysis of the Report 190/1 Engineering N1 – N6 examination results in terms of subject pass and retention rates, as well as the certification rates on each level of the Report 190/1 Engineering programmes.

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From the table:

- N5 and N6 subjects pass rates improved respectively from 86% and 89% in 2016 to 89% and 90% in 2017. There was a decline of three percentage points in the subject pass rate in N4 over the same period.

- More attention needs to be given to the retention rates of the N5 and N6 programmes.

- More attention also needs to be given to N4 - N6 certification rates which decreased on average by three percentage points over the same period.

A N A LY S I S O F 2 0 1 4 - 2 0 1 7 N 4 – N 6 B U S I N E S S S T U D I E S E X A M I N AT I O N R E S U L T S

L e v e l s


2 0 1 4 2 0 1 5 2 0 1 6 2 0 1 7 2 0 1 4 2 0 1 5 2 0 1 6 2 0 1 7 2 0 1 4 2 0 1 5 2 0 1 6 2 0 1 7

N4 86% 87% 95% 92% 87% 88% 81% 82% 57% 56% 59% 56%

N5 84% 91% 86% 89% 91% 91% 89% 86% 52% 52% 50% 48%

N6 85% 95% 89% 90% 94% 95% 94% 91% 50% 49% 54% 51%

9.2.4 N4 – N6 Business Studies Examination Results

The table below provides an analysis of the Report 190/1 N4 – N6 examination results in terms of subject pass and retention rates, as well as the certification rates on each level of the Report 190/1 Business studies programmes.

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P E R F O R M A N C E I N M AT H E M AT I C S & M AT H E M AT I C A L L I T E R A C Y

L e v e l s

S u b j e c t P a s s R a t e s S u b j e c t R e t e n t i o n R a t e

2 0 1 5 2 0 1 6 2 0 1 7 2 0 1 5 2 0 1 6 2 0 1 7

Mathematical Literacy L2 93% 92% 93% 62% 53% 61%



Mathematics L2 67% 82% 95% 59% 38% 40%

Mathematics L3 65% 79% 90% 77% 59% 61%

Mathematics L4 52% 55% 52% 82% 79% 80%

E N G I N E E R I N G R E P O R T 1 9 0 / 1 N 1 – N 6

L e v e l s

S u b j e c t P a s s R a t e s S u b j e c t R e t e n t i o n R a t e

2 0 1 5 2 0 1 6 2 0 1 7 2 0 1 5 2 0 1 6 2 0 1 7

Mathematics N1 94% 93% 87% 62% 57% 64%

Mathematics N2 45% 81% 62% 88% 66% 77%

Mathematics N3 68% 62% 79% 86% 86% 83%

Mathematics N4 NA NA 88% NA NA 74%



9.2.5 Mathematics and Mathematical Literacy Results

The table below shows overall significant improvement in the Mathematical Literacy and Mathematics results when comparing 2016 to 2017. On NC(V) Mathematics Level 4 there was a decrease of 3%. There was also a decrease in the N1 and N2 Mathematics pass rates over the same period with the N2 results decreasing by nineteen percentage points.

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9.2.6 E-learning

During 2017, an e-learning co-ordinator post was created as part of the restructuring process. This contributed tremendously to building capacity of staff and students in using e-learning platforms and methodologies. Some of the strides made include the following:

- The OLC’s became more functional with OLC officials being appointed and students starting to use the facilities.

- The Moodle Learning Management System (LMS) was established and students and staff started to use the system from the third term of 2017.

- In 2017, a total of 61 lecturers were trained on the Moodle LMS through a 4 hour in-house training session across all campuses. This resulted in a sharp increase in the use of the LMS.

- All students were provided with a Boland College e-mail address and registered to use the Moodle platform. This address will be kept active for 5 years after students complete their studies in order or the Work Integrated Learning (WIL) department to keep contact with all students in order to trace and track them.

- 27 Academic staff members were further exposed to e-learning technologies and possibilities by attending the North South TVET ICT Conference and EduTech Expo. This opportunity was specifically offered to staff enthusiastic about embracing e-learning.

9.2.7 Academic Support

Focused, well planned interventions, coupled with a realistic budget for Academic Support in targeted areas such as poor performing subjects, including specific subjects such as Mathematics and Mathematical Literacy, brought about an overall significant improvement in examination results. Academic interventions included the following:

- In-class support by means of class assistants;

- Tutoring;

- Additional periods allocated for ‘poor’ performing subjects;

- E-learning support and special software programmes;

- Extra classes;

- Specific intervention programmes before the start of formal classes, for example the ‘Ready Steady’ Mathematics programme;

- The Western Cape Department of Economic Development and Tourism (DEDAT) provided funding for the appointment of a Mathematics Class Assistant at Strand campus. The assistant started in the third term of 2017 and the focus of the intervention was to assist students struggling with Mathematics N1 and NC(V) Level 2.

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9.2.8 Improved linkages with Industry

The College had been constantly attempting to partner with industry in order to increase its footprint in education and training so that its learners have the best opportunities whilst at the College and also when they exit. The following are some important linkages which started in 2017:

- Boland College was one of 26 colleges nationally awarded Centre of Specialisation (CoS) status. Through this initiative the DHET will resource all CoS colleges in order to pilot the new QCTO artisan qualifications in 13 priority trades. Plans to resource and fund are underway with 2018 being the preparation phase and in January 2019 the training of the apprentices who have contracts with companies will start their training at Worcester Campus.

- Through a funding initiative by the EWSETA, the Stellenbosch University Water Institute (SUWI) approached Boland College to participate in a capacity building initiative in Water & Waste Water Treatment Training. Three key staff members were trained on a short course in Water Governance. The motivation for training of Boland College staff was to capacitate them to offer training to municipal staff in water and waste water treatment.

- The College remains an active participant in WorldSkills South Africa at both provincial and national level. The College had two entrants, Rhonwen Johnson for Auto Technology (motor mechanics) and Cullum Knoesen for Electrical Installations and they participated in the provincial competition. Unfortunately, they were not the eventual finalists for the province. Two of our academic staff members, the HOD: Hospitality and Tourism, Wickus van der Westhuizen, and the Motor Mechanics lecturer, Durand Baxter, were nominated as skills experts in their respective fields to assist the national experts at the National WSSA competition which took place at the Durban ICC from 14 to 16 February 2017. Wickus van der Westhuizen is also the provincial skills expert for restaurant services.

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9 . 3 S T R A T E G I C O B J E C T I V E 3 : T O I M P R O V E I N F R A S T R U C T U R E

C A PA C I T Y O F B O L A N D C O L L E G E T O O F F E R L E A R N I N G

O P P O R T U N I T I E S

No additional funding was available for the expansion of infrastructure in 2017. The remainder of 2016’s funding was utilised for the upgrade of Jacaranda Residence at Paarl campus. The declining number in residence students necessitated the use of a smaller residence building (Jacaranda) in order to be more cost effective. The kitchen, bathrooms and security of Jacaranda were upgraded and students moved in from 1 July 2017.

The focus on infrastructure during 2017 was maintenance of buildings, security, grounds and equipment. Occupational Health and Safety matters received major priority.

The DHET Infrastructure Asset Management system training also commenced in 2017. Two of the senior Infrastructure Management staff attended the initial training and afterwards started with the auditing of infrastructure. The project will continue in 2018.

i. Information Technology

The following Information Technology achievements were noteworthy in 2017:

- Provision of ICT equipment (computers, printers, projectors, network, internet and software) to ensure effective teaching and learning was the top priority for the ICT Department.

- Wi-Fi service was installed at all campuses, limited to the Open Learning Centres and the staff rooms. Expansion of the service was under consideration.

- Research for a new PABX system that will ensure huge cost savings on telephone bills was carried out. The testing of infrastructure was done and installation and implementation will take place in 2018.

- The student centered NSFAS system almost came to a standstill during 2017 and all second semester NSFAS submissions had to be done manually. NSFAS has also moved to a manual/paper based intervention for the signing of Statement of Particulars forms.

- A Disaster Recovery Plan was developed, approved and implemented.

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9 . 4 S T R A T E G I C O B J E C T I V E 4 : T O D E V E L O P PA R T N E R S H I P S A N D M A I N T A I N G O O D S T A K E H O L D E R N E T W O R K I N G T O I N C R E A S E T H E N U M B E R O F S T U D E N T S W H O A R E A D E Q U A T E LY P R E PA R E D T O E N T E R T H E L A B O U R M A R K E T

One of the eight identified millennium goals of building a global partnership for development was embraced by Boland College to strengthen its mandate with industry. Through industry, companies are able to collaborate with the College to build capacity which brings the skills that business requires. These mutually rewarding relationships provide a sustainable partnership, which will be of wider social and economic benefit to the country.

As we are striving to uphold the theme of DHET, ‘turning every workplace into a training space’, we were obliged to focus on sourcing relevant partners in order for our exit level and occupational students to gain relevant experience. Work Integrated Learning (WIL) is seen as an important way to improve the quality of teaching and learning, as well as to attain greater alignment between College curricula and skills’ needs of industry. As our placement market changed, we had to critically look at our product and brand.

The transition of students from a theoretical training environment into the world of work can be a traumatic and even unsettling experience for students who are ill prepared for the complexities and rigors of entering the job market, hence our constant interventions in the form of job readiness workshops and Work Based Experience (WBE).

9 . 5 S T R A T E G I C O B J E C T I V E 5 : T O I M P R O V E C O R P O R A T E A D M I N I S T R A T I O N A N D M A N A G E M E N T T O E N S U R E C O N T I N U O U S B U S I N E S S E X C E L L E N C E

The Council of Boland College is fully functional and meets quarterly. The vacancy in the Council for a member with legal expertise was filled in 2017. The sub-committees of Council also meet quarterly and are informed of all strategic matters, as well as specific operational matters of the College. Special meetings are held when necessary.

Both the Internal Audit and Risk Management functions were functional. Meetings of the Risk Management Committee and the Audit and Risk Committee were held quarterly and reporting was done timeously to the relevant governance structures.

The external audit for the 2016 year was the first to be carried out by the Auditor General. Boland College received a clean audit, which is undoubtedly confirmation of the College’s dedication to good corporate governance.

9 . 6 S T R A T E G I C O B J E C T I V E 6 : T O D E V E L O P A N D I M P L E M E N T A G R E E N I N I T I A T I V E I N T E R M S O F T H E T V E T C O L L E G E M O N I T O R I N G A N D E VA L U A T I O N F R A M E W O R K

Each Vice-Principal reported on the performance of his/her division at various forums, including sub-committees of Council. The College allocated the responsibility of compiling ad-hoc reports for the Department of Higher Education and Training to a relevant departmental manager. Moreover, the College made one person responsible for submission of the quarterly and semester reports on College performance to the Department of Higher Education and Training. In doing so the College ensured that monitoring and evaluation reports were submitted on time.

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To provide quality technical and vocational education and training services and increase academic achievement and success of students

1 0 . 1 A N N U A L P E R F O R M A N C E A C H I E V E M E N T S

The tables below report on achievements of annual performance targets.

10 P E R F O R M A N C ER E P O R T I N G

STRATEGIC OBJECTIVE #1

P E R F O R M A N C E I N D I C AT O R S T V E T C O L L E G E 2 0 1 7 / 1 8 P L A N N E D TA R G E T

T V E T C O L L E G E 2 0 1 7 / 1 8 A C H I E V E M E N T

E X P L A N AT O R Y R E M A R K S

Appropriate teaching and learning support plan developed and implemented (n)

1 1

Appropriate student support plan developed and implemented (n)

1 1

Improved certification rates in:NC(V) L4

N3 &

N6 (%)

62%

35%

64%

50%

23%

51%

Target set too high

Target set too high

Target set too high.Also offered Engineering N4-N6 for the 1st time

Throughput rate (%) 29% 33%

Funded NC(V) L4 students obtaining qualification within stipulated time (%)

35% 35%

TVET students enrolled in foundation or bridging programmes (n)

215 282

Students completing artisan-related programmes (n)

2 054 1 311

Established centre/s of specialisation (COS) (n)

1 1

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To have adequate infrastructure and systems in place to increase access and provide effective services to students

To develop partnerships and maintain good stakeholder relations to increase the number of students who are adequately prepared to enter the labour market, or further and higher learning opportunities






Head count enrolment (n) - State funded

6 696 6 660

Head count enrolment (n) - College funded

337 365

Head count enrolment (n) - Funded from other sources 2 407 2 860

Students accommodated in College accommodation (n)

928 202

The financial decision was taken by EXCO not to admit more students into the residences which the College could not afford. Students who were NSFAS recipients in 2017 and complied with departmental academic require-ments for promotion to the next level of the programme would be allowed accommodation at residences in 2018. It is important to note that there were two categories of residence students, those funded by NSFAS and those self-funded (referred to as Fee Paying Students). This would include students holding other bursaries or funded by third parties.

Qualifying students obtaining financial assistance (n)

5 089 3 565




Beneficial and functionalCollege partnerships (n)

200 200

TVET lecturers placed in workplaces for specifiedperiods (n)

5 1

TVET students placed in workplaces/industry for specified periods for work exposure, experiential learning and/or certification purposes (n)

2 235 2 719

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To ensure continuous business excellence in terms of good corporate governance and effectual management of all College resources, as well as information and data reporting

To monitor and evaluate all College processes in terms of the framework for TVET college performance and report quarterly in this regard






Compliance to governance standards (%)

100% 100%

Compliance to policies and regulations applicable to the TVET College sector (%)

100% 100%

Obtaining unqualified audits or assessments (n)

1 1

Compliance with national policy of college examination centres conducting examinations and assessments (%)

100% 100%




Accurate M&E quarterly reports submitted (n)

4 4

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1 0 . 2 C O L L E G E A C H I E V E M E N T I N T E R M S O F T V E T S Y S T E M T A R G E T S

The table below reports on achievement of sub outcomes 2 and 4 targets.

S Y S T E M TA R G E T 2 0 1 7 / 1 8 P l a n n e d N a t i o n a l T a r g e t

T V E T C o l l e g e 2 0 1 7 / 1 8 P l a n n e d T a r g e t

T V E T C o l l e g e 2 0 1 7 / 1 8 A c h i e v e m e n t

E x p l a n a t o r yR e m a r k s

Head count enrolment (n) – State funded

429 638 6 696 6 660

Head count enrolment (n) – College funded

235 110 337 365

Head count enrolment (n) – funded from other sources

45 787 2 407 2 860

Certification rate NC(V)Level 4 (%) 65% 62% 50% Target set too high

Certification rate N3 (%) 65% 35% 23% Target set too high

Certification rate N6 (%) 65% 64% 51% Target set too high

Throughput rate (%) College baseline 29% 33%

College examination centres compliant with nationalpolicy (%)

100% 100% 100%

Qualifying TVET students obtaining financial assistance (n)

200 000 5 089 3 565

Funded NC(V) Level 4 students obtaining qualification within stipulated time (%)

60% 35% 35%

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1 0 . 3 S T R A T E G Y T O D E A L W I T H U N D E R P E R F O R M A N C E

1 0 . 3 . 1 A C A D E M I C

10.3.1.1 Headcounts

The headcount target was 9 440 and the actual figure achieved was 9 885.

10.3.1.2 Academic results

NC(V) Level 4 certification rateThe College did not achieve its 2017 NC(V) Level 4 certification target of 62%. The actual achievement of 50%, means it is below target by 12%, but up by 5% of the College’s actual achievement of 45% in 2016. The DHET NC(V) Level 4 certification target for 2019/20 is 65% with a National APP target of 30% for 2018. This means that the DHET target is also not very realistic. The following are some of the strategies adopted to improve academic performance:

- Campuses are to strengthen academic support to improve retention and certification;

- Programme managers and leaders must focus on addressing student absenteeism;

- Improve screening of placement in the various programmes;

- Prioritising poorest performing subjects for specific interventions;

- Special focus on Engineering subjects such as Mathematics, Science and Drawings;

- Campuses must emphasise the impact of the minimum examination admission requirements in terms of Internal Continuous Assessments (ICASS), as well as that of attendance to ALL students.

10.3.1.3 N3 & N6 certification rate

The target certification rate of 35% for N3 and 64% for N6 was not achieved. The improvement strategy is generally the same as that above highlighted under the NC(V) Level 4 under performance comments.

10.3.1.4 TVET lecturers placed in workplaces for specified periods

In order to positively report on this item, the College is in the process of finalising a policy to support the strategy of having staff placed in industry. There is placement happening in the Early Childhood Programme where

staff do visit and support learners in the workplace, but the programmes where the largest needs exist need to be identified.

10.3.2 Residences

Boland College has residences at four of its five campuses. Accommodation includes 3 meals per day, supervision and access control, free laundry facilities and DSTV. These services were provided although the NSFAS subsidy covered only half of the real cost per resident. Subsidising all the residence students has placed severe financial strain on the College. Unfortunately all NSFAS allowances for residences were allocated during the first semester. Subsequently the target set for students in residences could not be reached in the second semester of 2017. The declining number of residence students led to Bruwer House at Paarl campus being vacated because the smaller number of students could be accommodated in Jacaranda House. A further advantage of the move was that security and convenience for the students were enhanced as Jacaranda was on the premises of the academic buildings, whereas Bruwer House was on separate premises some distance from the academic buildings. The biggest challenge faced was water restrictions. Taps from baths were removed and water saving devices were installed in the toilet cisterns.

10.3.3 Work Placement and Partnerships

We are continuously trying to improve our standards of teaching and learning, by drawing upon the resources and expertise of the industry for which our students are being prepared. We celebrate our much-needed partnerships as a measure to ensure that students receive their National diplomas through practical experience. Recruiting industry experts who are willing and able to give up their time, especially voluntarily, can be a challenge. Existing networks established enabled us to identify industry experts. Collaboratively we will be targeting professional and industry associations to co-operate with us in order to place our students. As Boland College’s mandate now includes placement of occupational students, it is running the risk of the hosting market becoming saturated. Taking into account the geographical areas of its rural campuses, not all employers are willing to host students, for various reasons. Our Worcester campus has been afforded the privilege of being selected as a Centre of Specialisation for welding whereby students and employers will benefit.

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B O L A N D T V E T C O L L E G E

FINANCIAL STATEMENTS

1

IND

EX0304

05-0910111213

14-3031-70

General InformationCouncil’s Responsibilities and Approval Report of the Auditor-GeneralStatement of Financial PositionStatement of Financial PerformanceStatement of Changes in Net AssetsCash Flow StatementAccounting PoliciesNotes to the Financial Statements

AG Auditor GeneralASB Accounting Standards BoardDHET Department of Higher Education and TrainingGRAP Generally Recognised Accounting PracticeSARS South African Revenue ServicesVAT Value Added TaxCET Act CET Act No.16 of 2006, as amended

F INANCIAL STATEMENTS

ABBREVIAT IONS

2

Controlling entity

Department of Higher Education and Training (DHET)

Financial Statements relate to

BOLAND TVET COLLEGE

Domicile, legal form and jurisdiction

The Collegeis a Public Technical and Vocational Education and Training College, constituted interms of the Continuing Education and Training Act No.16 of 2006, asamended (CET Act), and operates from a Central Office situated in Stellenbosch, South Africa, with campusses in the following locations and serving the surrounding areas: Caledon, Paarl, Stellenbosch, Strand and Worcester.

Nature of business and principal activitiesTo provide continuing education and training to regis-tered students for all learning and training programmes leading to qualifications or part qualifications at levels 1 to 4 of the National Qualifications Framework.

Councillors

Bakker, J (until 31-10-2017)Bleazard, DK (Chairperson)Cloete, HCADladla. ZP (until 02-08-2017)Gelderblom, IJ (from 01-07-2017)Kabanyane, GCLingela, TSMacMaster, LLMMatolengwe, NMdludlu, M (from 06-09-2017)Myburgh, EC (until 30-06-2017)Peters, EPieterse, IPietersen, VRFPlaatjies, DVan der Merwe, HAVan Louw, CL

Principal

Myburgh, EC (until 30-06-2017)Gelderblom, IJ (Acting Principal from 01-07-2017)

Chief Financial Officer (CFO)

Gelderblom, IJ (until 16-07-2017)Neal, CR (Acting CFO) from 17-07-2017)

Registered office

85 Bird Street, Stellenbosch, 7600

Business address

85 Bird Street, Stellenbosch, 7600

Postal address

Private Bag X5068, Stellenbosch, 7599

Bankers

ABSA LimitedAuditorsAuditor General (SA)

GENERALINFORMATION

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The council is required by the Continuing Education and Training Act No. 16 of 2006, as amended, to maintain adequate accounting records and is responsible for the content and integrity of the financial statements and related financial information included in this report. It is the responsibility of council to ensure that the financial statements fairly present the state of affairs of the College as at the end of the financial year and the results of its operations and cash flows for the year then ended, in conformity with GRAP. The Auditor-General was engaged to express an independent opinion on the financial statements and was given unrestricted access to all financial records, related data and relevant parties.

The financial statements have been prepared in accordance with the Standards of GRAP including any interpretations, guidelines and directives issued by the ASB and in the manner required by the Minister of Higher Education and Training.

The financial statements are based on appropriate accounting policies consistently applied and supported by reasonable and prudent judgements and estimates.

Council acknowledges that it is ultimately responsible for the system of internal financial control established by the College and places considerable importance on maintaining a strong control environment, which includes the safeguarding of assets and compliance with relevant legislation. To enable the council to meet these responsibilities, the council sets standards for internal control aimed at reducing risk in a cost effective manner. The standards include the proper delegation of responsibilities within a clearly defined framework, effective accounting and other procedures, and adequate segregation of duties to ensure an acceptable level of risk. These controls are monitored throughout the College and employees and management are required to maintain the highest ethical standards in ensuring the college’s business is conducted in a manner that in all reasonable circumstances is above reproach. The focus of risk management in the college is on identifying, assessing, managing and monitoring all known forms of risk across the college. While operating risk cannot be fully eliminated, the College endeavours to minimise it by ensuring that appropriate infrastructure, controls, systems and ethical behaviour are applied and managed within predetermined procedures and constraints.

The council accepts its responsibility to ensure that the College is managed in a responsible manner, considering the interest of all stakeholders, including the DHET, unions, employees, students, local communities and creditors. Responsible management entails, inter alia, compliance with applicable statutory and regulatory requirements, including risk management.

The council is cognisant of the qualified opinion of the Auditor General in respect of the 2017 Annual Financial Statements. Notwithstanding the qualification, council is of the view, based on the information and explanations given by management, that the system of internal control provides reasonable assurance that the financial records may be relied on for the preparation of the financial statements and that the financial statements are free from material misstatement, whether due to fraud or error. However, any system of internal financial control can provide only reasonable, and not absolute, assurance against material misstatement or deficit.

The council has reviewed the College’s cash flow forecast for the year to 31 December 2018 and, in the light of this review and the current financial position, it is satisfied that the College has, or has access to, adequate resources to continue in operational existence for the foreseeable future.

The College is dependent on the DHET for continued funding of operations in line with the annual DHET programme funding allocation. The financial statements are prepared on the basis that the College is a going concern and that the DHET has neither the intention nor the need to liquidate or curtail materially the scale of the College’s operations.

The Auditor-General is responsible for independently auditing and reporting on the College’s financial statements and his report is presented with these financial statements.

The financial statements set out on page 10 to 70 were approved by the council on 30 May 2018 and were signed on its behalf by:

DAVID BLEAZARD // Council Chairperson

30 May 2018

COUNCIL’S RESPONSIBILITIES AND APPROVAL

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Report on the audit of the financial statements

Qualified opinion

1. I have audited the financial statements of the Boland TVET College set out on pages 10 to 70, which comprise the statement of financial position as at 31 December 2017, the statement of financial performance, statement of changes in net assets and cash flow statement for the year then ended, as well as the notes to the financial statements, including a summary of significant accounting policies.

2. In my opinion, except for the possible effects of the matter described in the basis for qualified opinion section of this report, the financial statements present fairly, in all material respects, the financial position of the Boland TVET College as at 31 December 2017, and its financial performance and cash flows for the year then ended in accordance with South African Standards of Generally Recognised Accounting Practice (Standards of GRAP) and the requirements of the Continuing Education and Training Act of South Africa, 2006 (Act no. 16 of 2006) (CETA).

Basis for qualified opinion

Property Plant and Equipment

3. I was unable to obtain sufficient appropriate audit evidence that furniture and fittings were correctly accounted for due to the status of accounting records and non-submission of information in support of these assets. Furniture and fittings were incorrectly expensed and/or classified and I was unable to determine the extent of the adjustments necessary. I was unable to confirm whether furniture and fittings were correctly accounted for by alternative means. Consequently, I was unable to determine whether any adjustments were necessary to furniture and fittings stated at R8 837 462 in note 6 (2016: R10 365 969) to the financial statements, and related elements making up the statements of financial performance, changes in net assets and cash flows.

4. I was unable to obtain sufficient appropriate audit evidence for the restatement of the corresponding figure for Property, Plant and Equipment. As described in note 39 to the financial statements, the restatement was made to rectify a previous year misstatement, but the restatement could not be substantiated by supporting audit evidence. I was unable to confirm the restatement by alternative means. Consequently, I was unable to determine whether any adjustment was necessary to the Property, Plant and Equipment corresponding figure stated at R249 820 619 in note 6 to the financial statements.

REPORT OF THE AUDITOR-GENERALT O T H E M I N I S T E R O F H I G H E R E D U C A T I O N A N D T H E C O U N C I L O F B O L A N D T V E T C O L L E G E

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Context for the opinion

5. I conducted my audit in accordance with the Interna- tional Standards on Auditing (ISAs). My responsibilities under those standards are further described in the auditor-general’s responsibilities for the audit of the financial statements section of this auditor’s report.

6. I am independent of the college in accordance with the International Ethics Standards Board for Account- ants’ Code of ethics for professional accountants (IESBA code) and the ethical requirements that are relevant to my audit in South Africa. I have fulfilled my other ethical responsibilities in accordance with these requirements and the IESBA code.

7. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my qualified opinion.

Emphasis of matter

8. I draw attention to the matters below. My opinion is not modified in respect of these matters.

Material Impairments

9. As disclosed in note 3 to the financial statements, a material impairment provision of R2 077 833 (2016: R1 443 659) was made for receivables for exchange transactions, which relates mainly to outstanding student fees, national and provincial government receivables.

Restatement of corresponding figures

10. As disclosed in note 39 to the financial statements, the corresponding figures for 31 December 2016 have been restated as a result of errors discovered during the 2017 financial year in the financial statements of the college at, and for the year ended 31 December 2017.

Responsibilities of council for the financial statements

11. The council is responsible for the preparation and fair presentation of the financial statements in accordance with Standards of GRAP and the requirements of the CETA, and for such internal control as the council determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

12. In preparing the financial statements, the council is responsible for assessing the Boland TVET College’s ability to continue as a going concern, disclosing, as applicable, matters relating to going concern and using the going concern basis of accounting unless the council either intends to liquidate the college or to cease operations, or has no realistic alternative but to do so.

Auditor-general’s responsibilities for the audit of the financial statements

13. My objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes my opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

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14. A further description of my responsibilities for the audit of the financial statements is included in the annexure to this auditor’s report.

Performance information reporting

15. The college is not required to prepare a report on its performance against predetermined objectives, as it does not fall within the ambit of the PFMA and such reporting is also not required in terms of the CETA.

REPORT ON THE AUDIT OF COMPLIANCE WITH LEGISLATION.

Introduction and scope

16. In accordance with the PAA and the general notice issued in terms thereof, I have a responsibility to report material findings on the compliance of the college with specific matters in key legislation. I performed procedures to identify findings but not to gather evidence to express assurance.

17. The material finding on compliance with specific matters in key legislations are as follows:

Annual financial statements

18. The financial statements submitted for auditing were not prepared in accordance with generally recognised accounting practice and supported by complete accounting records, as required by section 25(1)(b) and 25(3) of the CET Act. Material misstatements of non-current assets, current assets, liabilities and disclosure items identified by the auditors in the submitted financial statements were corrected or the supporting records were provided subsequently, but the uncorrected material misstatements and supporting records that could not be provided resulted in the financial statements receiving a qualified opinion.

Other information

19. The council is responsible for the other information. The other information comprises the information included in the annual report. The other information does not include the financial statements and the auditor’s report.

20. My opinion on the financial statements and findings on compliance with legislation do not cover the other information and I do not express an audit opinion or any form of assurance conclusion thereon.

21. In connection with my audit, my responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or my knowledge obtained in the audit, or otherwise appears to be materially misstated.

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22. If, based on the work I have performed, I conclude that there is a material misstatement in this other information, I am required to report that fact. I have nothing to report in this regard.

Internal control deficiencies

23. I considered internal control relevant to my audit of the financial statements and compliance with applicable legislation; however, my objective was not to express any form of assurance on it. The matters reported below are limited to the significant internal control deficiencies that resulted in the basis for the qualified opinion and the finding on compliance with legislation included in this report.

Financial and performance management

24. Management did not implement adequate processes to ensure that assets are correctly accounted for in the financial statements due to the status of the accounting records. 25. Management did not implement proper record keeping in a timely manner to ensure that complete, relevant and accurate information is available and accessible to support financial reporting.

Cape Town29 May 2018

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ANNEXURE – AUDITOR-GENERAL’S RESPONSIBILITY FOR THE AUDIT

1. As part of an audit in accordance with the ISAs, I exercise professional judgement and maintain professional scepticism throughout my audit of the financial statements, and the procedures performed on the college’s compliance with respect to the selected subject matters.

Financial statements

2. In addition to my responsibility for the audit of the financial statements as described in this auditor’s report, I also:

• identify and assess the risks of material misstatement of the financial statements whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the over- ride of internal control.

• obtain an understanding of internal control relevant to the audit 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 college’s internal control

• evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the council

• conclude on the appropriateness of the council’s use of the going concern basis of accounting in the preparation of the financial statements. I also conclude, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Boland TVET college’s ability to continue as a going concern. If I conclude that a material uncertainty exists, I am required to draw attention in my auditor’s report to the related disclosures in the financial statements about the material uncertainty or, if such disclosures are inadequate, to modify the opinion on the financial statements. My conclusions are based on the information available to me at the date of this auditor’s report. However, future events or conditions may cause a college to cease continuing as a going concern.

• evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

Communication with those charged with governance

3. I communicate with the council regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that I identify during my audit.

I also confirm to the council that I have complied with relevant ethical require ments regarding independence, and communicate all relationships and other matters that may reasonably be thought to have a bearing on my independence and, where applicable, related safeguards.

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A C T U A L

A S S E T S N O T E2 0 1 7

R2 0 1 6

R

Current AssetsInventories Receivables from Exchange Transactions Receivables from Non-exchange TransactionsCash and Cash Equivalents

Non-Current AssetsProperty, Plant and Equipment

Total Assets

L I A B I L I T I E S

Current LiabilitiesPayables from Exchange TransactionsUnspent Conditional Grants and ReceiptsDBSA Loans

Non-Current LiabilitiesDBSA LoansOperating Lease Liabilities

Total Liabilities

Total Assets and Liabilities

NET ASSETSAccumulated Surplus

2 345

6

789

99

10

36,433,302699,982

20,097,62512,383,341

3,252,354

241,774,440241,774,440

278,207,742

25,937,23311,512,32313,880,720

544,191

333,333-

333,333

26,270,567

251,937,175

251,937,175251,937,175

34,932,054203,847

14,430,14810,834,000

9,464,059

249,820,619249,820,619

284,752,672

28,366,50612,687,63614,946,855

732,014

544,191544,191

-

28,910,696

255,841,976

255,841,976255,841,976

Total Net Assets and Liabilities 278,207,742 284,752,672

STATEMENT OF FINANCIAL POSITIONA T 3 1 D E C E M B E R 2 0 1 7

10

A C T U A L

R E V E N U E N O T E2 0 1 7

R2 0 1 6

R

Revenue from Non-exchange TransactionsOther Transfers and SponsorshipsGovernment Grants and Subsidies Received Public Contributions and Donations

Revenue from Exchange TransactionsTuition and Related FeesRental of Facilities and EquipmentInterest EarnedSale Of Goods And Rendering of ServicesOther Revenue

Total Revenue

E X P E N D I T U R E

Employee and Related CostsDepreciation and AmortisationExternal Audit FeesImpairment LossesMarketing ExpensesPrinting And StationeryRepairs and MaintenanceFinance CostsBooks and Learning MaterialsOperating Lease ExpenseProgramme ConsumablesMunicipal ServicesStudents Residents MealsProfessional ServicesSecurityTravel And AccommodationTelephone And InternetTraining And Staff DevelopmentGrants and Subsidies PaidGeneral ExpensesLoss on Disposal of Property, Plant and Equipment

Total Expenditure

11 1213

1415161718

192021222324252627

2829303132333435363738

-146,634,205

-

52,656,4605,801,198

399,466184,677

1,371,762

207,047,768

134,087,1139,137,8901,451,4605,730,6191,156,6253,091,1515,489,433

125,1604,582,7934,872,9726,591,119

11,820,8573,549,760

330,5855,150,553

827,3015,596,975

874,1202,858,9903,609,578

17,514

210,952,569

555,433124,047,483

709,756

79,183,8143,066,8651,788,008

195,4361,932,733

211,479,528

133,308,0868,755,124

444,2961,486,1332,151,5372,315,8686,872,159

215,8297,618,4263,908,1937,371,281

11,233,4486,404,207

665,7914,709,167

925,3426,956,5921,599,1219,600,2104,711,115

7,059

221,258,982

SURPLUS/(DEFICIT) FOR THE YEAR (3,904,801) (9,779,454)

STATEMENT OF FINANCIAL PERFORMANCE F O R T H E Y E A R E N D E D 3 1 D E C E M B E R 2 0 1 7

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Details on the movement of the Funds and Reserves are set out in Note 10.

D E S C R I P T I O N

T o t a l f o rA c c u m u l a t e d

S u r p l u s / ( D e f i c i t )A c c o u n t

T o t a l

R R

2016Balance at 31 December 2015Correction of Error (Note 39)Restated Balance

Surplus/(Deficit) for the yearBalance at 31 December 2016

Restated Balance

Surplus/(Deficit) for the yearBalance at 31 December 2017

251,947,26113,674,169

265,621,430

(9,779,454)255,841,976

255,841,976

(3,904,801)251,937,175

251,947,26113,674,169

265,621,430

(9,779,454)255,841,976

255,841,976

(3,904,801)251,937,175

STATEMENT OF CHANGES IN NET ASSETSF O R T H E Y E A R E N D E D 3 1 D E C E M B E R 2 0 1 7

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A C T U A L

C A S H F L O W S F R O M O P E R AT I N G A C T I V I T I E S N O T E2 0 1 7

R2 0 1 6

R

ReceiptsGovernment Grant and SubsidiesPublic Contributions and DonationsTuition and Related FeesInterest ReceivedRoyalties ReceivedOther Receipts

PaymentsEmployee Related CostsInterest PaidSuppliers PaidOther Payments

N E T C A S H F L O W S F R O M O P E R AT I N G A C T I V I T I E S

C A S H F L O W S F R O M I N V E S T I N G A C T I V I T I E S

Purchase of Property, Plant and EquipmentProceeds on Disposal of Property, Plant and EquipmentN E T C A S H F L O W S F R O M I N V E S T I N G A C T I V I T I E S

C A S H F L O W S F R O M F I N A N C I N G A C T I V I T I E S

R e p a y m e n t o f B o r r o w i n g sN E T C A S H F L O W S F R O M F I N A N C I N G A C T I V I T I E S

N E T I N C R E A S E / ( D E C R E A S E ) I N C A S H A N D C A S H E Q U I VA L E N T S

C a s h a n d C a s h E q u i v a l e n t s a t B e g i n n i n g o f P e r i o dC a s h a n d C a s h E q u i v a l e n t s a t E n d o f P e r i o d

121314161718

19263737

40

66

9

5

61,911,266-

42,138,589399,466184,677

7,172,960

(50,817,457)(125,160)

(58,768,986)(6,799,154)

(4,703,799)

(1,102,577)(6,649)

(1,109,226)

(398,681)(398,681)

(6,211,705)

9,464,0593,252,354

34,862,176709,756

68,057,5411,788,008

195,4365,555,030

(52,501,825)(215,829)

(57,390,588)(14,977,116)

(13,917,410)

(11,569,146)6,118

11,563,028)

(641,345)(641,345)

(26,121,783)

35,585,8429,464,059

CASH FLOW STATEMENTF O R T H E Y E A R E N D E D 3 1 D E C E M B E R 2 0 1 7

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1. BASIS OF PRESENTATION

The Annual Financial Statements have been prepared on an Accrual Basis of accounting and are in accordance with the historical cost convention, except where indicated otherwise.The Annual Financial Statements have been prepared in accordance with the effective Standards of Generally Recognised Accounting Practices (GRAP) and in the manner prescribed by the Minister of Higher Education and Training in terms of the Continuing Education and Training Act No. 16 of 2006, as amended.

1.1 Changes in Accounting Policy and Comparability

Accounting Policies have been consistently applied, except where otherwise indicated below.

For the years ended 31 December 2016 and 31 December 2017 the college has adopted the accounting framework as set out in paragraph 1 above. The details of any resulting changes in Accounting Policy and comparative restatements are set out below and in the relevant Notes to the Annual Financial Statements.

The college changes an Accounting Policy only if the change:

(a) Is required by a Standard of GRAP; or(b) Results in the Annual Financial Statements providing reliable and more relevant information about the effects of transactions, other events or conditions on the college’s financial position, financial performance or cash flow.

1.2 Critical Judgements, Estimations and Assumptions

In the application of the college’s Accounting Policies, which are described below, management is required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

These estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods.The following are the critical judgements and estimations that management have made in the process of applying the college’s Accounting Policies and that have the most significant effect on the amounts recognised in Annual Financial Statements:

1.2.1 Revenue Recognition

Accounting Policy 9.2 on Revenue from Exchange Transactions and Accounting Policy 9.3 on Revenue from Non-exchange Transactions describes the conditions under which revenue will be recorded by the management of the college.

In making their judgement, the management considered the detailed criteria for the recognition of revenue as set out in GRAP 9 (Revenue from Exchange Transactions) and GRAP 23 (Revenue from Non-exchange Transactions). As far as Revenue from Non- exchange Transactions is concerned (see Basis of Preparation above), and, in particular, whether the college, when goods are sold, had transferred to the buyer the significant risks and rewards of ownership of the goods and when services is rendered, whether the service has been rendered. Also of importance is the estimation process involved in initially measuring revenue at the fair value thereof. Management of the college is satisfied that recognition of the revenue in the current year is appropriate.

1.2.2 Financial Assets and Liabilities

The classification of Financial Assets and Liabilities, into categories, is based on judgement by management. Accounting Policy 7.1 on Financial Assets Classification and Accounting Policy 7.2 on Financial Liabilities Classification describe the factors and criteria considered by the management of the college in the classification of Financial Assets and Liabilities.In making the above-mentioned judgement, management considered the definition and recognition criteria for the classification of Financial Instruments as set out in GRAP 104 (Financial Instruments ).

F O R T H E Y E A R E N D E D 3 1 D E C E M B E R 2 0 1 7

ACCOUNTING POLICIES TO THE ANNUAL FINANCIAL STATEMENTS

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1.2.3 Impairment of Financial Assets

Accounting Policy 7.4 on Impairment of Financial Assets describes the process followed to determine the value at which Financial Assets should be impaired. In making the estimation of the impairment, the management of the college considered the detailed criteria of impairment of Financial Assets as set out in GRAP 104 (Financial Instruments) and used its judgement to select a variety of methods and make assumptions that are mainly based on market conditions existing at the end of the reporting period. The management of the college is satisfied that impairment of Financial Assets recorded during the year is appropriate.

• Impairment of Trade Receivables:The College assesses its financial assets for impairment at the end of each financial year. In determining whether an impairment loss should be recorded in surplus or deficit, the College makes judgements as to whether there is observable data indicating a measurable decrease in the estimated future cash flows from a financial asset.

The College has implemented a policy to classify all debts as irrecoverable where they have been outstanding for more than one year (12 months). These amounts are than transferred to a provision for doubtful debts which is adjusted annually. All non recoveries of these amounts impaired are then recognised as bad debts written off in the following year through the statement of financial performance. This practice based on the past patterns of history of payments by students after considering the period the debt has been outstanding for. Attempts at recovery include sending letters of demand and handing debts over to collection agencies as guided in the financial policy of the College.

1.2.4 Useful lives of Property, Plant and Equipment, Intangible Assets and Investment Property

As described in Accounting Policies 3.3, 4.2 and 5.2, the college depreciates its Property, Plant & Equipment and Investment Property, and amortises its Intangible Assets, over the estimated useful lives of the assets, taking into account the residual values of the assets at the end of their useful lives, which is determined when the assets are available for use.

The useful lives of assets are based on management’s estimation. Management considered the impact of technology, availability of capital funding, service requirements and required return on assets in order to determine the optimum useful life expectation, where appropriate.

The estimation of residual values of assets is based on management’s judgement as to whether the assets will be sold or used to the end of their useful lives, and in what condition they will be at that time.

1.2.5 Impairment: Write-down of Property, Plant & Equipment, Intangible Assets, Investment Property, Heritage Assets and Inventories

Accounting Policy 6 on Impairment of Assets, Accounting Policy 4.2 on Intangible Assets – Subsequent Measurement, Amortisation and Impairment and Accounting Policy 8.2 on Inventory – Subsequent Measurement describe the conditions under which non-financial assets are tested for potential impairment losses by the management of the college. Significant estimates and judgements are made relating to impairment testing of Property, Plant and Equipment, impairment testing of Intangible Assets and write-down of Inventories to the lowest of Cost and Current Replacement Cost.

In making the above-mentioned estimates and judgement, management considered the subsequent measurement criteria and indicators of potential impairment losses as set out in GRAP 21 (Impairment of Non-cash Generating Assets) and GRAP 26 (Impairment of Cash Generating Assets). In particular, the calculation of the recoverable service amount for PPE and Intangible Assets and the Current Replacement Cost for Inventories involves significant judgment by management.

Estimated impairments during the year to Property, Plant and Equipment, Intangible Assets, Investment Property, Heritage Assets and Inventory are disclosed in Notes 2 and 6 in the Annual Financial Statements, if applicable.

1.2.6 Provisions and Contingent Liabilities

Management judgement is required when recognising and measuring Provisions and when measuring Contingent Liabilities. Provisions are discounted where the effect of discounting is material using actuarial valuations.

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1.2.7 DHET Funding of operations

The Department of Higher Education and Training (DHET) annually provides funding to the college for it operations. The official title of the funding is Programme Funding. Programme funding is allocated to the College by DHET in terms of the CET Act and the National Norms and Standards for Funding of TVET Colleges and is determined by the estimated Full Time Equivalent Students (FTEs) of the College. The allocation is done based on the projected FTEs for the year and if the College fails to register the projected FTEs, a portion of the programme funding can be clawed back in the following year. The programme funding is allocated by DHET during their financial year which is from April to March, but for the College the funds pertain to the College academic and financial year which is from January to December. Once the College has registered the projected number of FTEs, the condition of the programme funding grant has been met and the grant is recognised in full. The programme funding is paid out partly in cash tranches, paid to the College, and partly through the Persal system of the National Education Department, directly to the employees of the College. If management personnel are paid from the programme funding, they should be included in the description. The method and timing of payment of the grant does, however, not influence the recognition of revenue.

In terms of the CET Act and DHET Circular 1 of 2015, with effect from 1 April 2015, all non-management personnel of the College, appointed and remunerated through the Department of Education (PERSAL) and the allocation or programme funding, have migrated to DHET and are DHET employees. Non-management personnel not remunerated from provincial allocations or programme funding remain employees of the College as they are appointed by the College.

1.2.8 Campuses or other property used and controlled, but not owned by the College

Certain campuses and other property are used by the College and are not registered in the name of the College. The lack of legal ownership could affect whether or not the College has control over the campus. Where, inter alia, beneficial control can be illustrated, the campus in question is recognised, measured and included in the financial statements as either property, plant and equipment (campuses or other property) or investment property (other property) in terms of the definition of an asset as per the Framework for the Preparation and Presentation of Financial Statements and the definition of Property, Plant and Equipment in GRAP 17 Property, Plant and Equipment or Investment Property in GRAP 16 Investment Property.

1.2.9 Classification of land and buildings as property, plant and equipment or investment property

Based on management’s judgement, the following criteria have been applied to distinguish Investment

properties from owner occupied property or property held for resale:

(a) Land held for long-term capital appreciation rather than for short-term sale in the ordinary course of operations;

(b) Land held for a currently undetermined future use (If the college has not determined that it will use the land as owner- occupied property or for short-term sale in the ordinary course of operations, the land is regarded as held for capital appreciation);

(c) A building owned by the college (or held by the college under a finance lease) and leased out under one or more operating leases on a commercial basis (this will include the property portfolio rented out on a commercial basis on behalf of the college);

(d) A property owned by the college and leased out at a below market rental;

(e) Property that is being constructed or developed for future use as investment property.

The rent earned does not have to be at a commercial basis or market related for the property to be classified as investment property.

The following assets do not fall in the ambit of Investment Property and shall be classified as Property, Plant and Equipment, Inventory or Non-current Assets Held-for-Sale, as appropriate:

(a) Property held for sale in the ordinary course of operations or in the process of construction or development for such sale;(b) Property being constructed or developed on behalf of third parties;(c) Owner-occupied property, including (among other things) property held for future use as owner- occupied property, property held for future development and subsequent use as owner- occupied property, property occupied by employees such as housing for personnel (whether or not the employees pay rent at market rates) and owner-occupied property awaiting disposal;(d) Property that is leased to another entity under a finance lease;(e) Property held to provide goods and services and also generates cash inflows; and(f) Property held for strategic purposes which would be accounted for in accordance with the Standard of GRAP on Property, Plant and Equipment.

Based on an evaluation of the above, the college does not hold investment property.

1.3 Presentation Currency

The Annual Financial Statements are presented in South African Rand, rounded off to the nearest Rand which is the college’s functional currency.

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1.4 Going Concern Assumption

Management and council have made the assessment that the entity is a going concern and the financial statements have been prepared on a going concern basis.

1.5 Offsetting

Assets, Liabilities, Revenues and Expenses have not been offset except when offsetting is required or permitted by a Standard of GRAP.

1.6 Standards, Amendments to Standards and Interpretations issued but not yet Effective

The college applied the principles established in the following Standards of GRAP that have been issued but are not yet effective, in developing appropriate Accounting Policies dealing with the following transactions, but have not early adopted these Standards:

Where a standard of GRAP is approved as effective, it replaces the equivalent statement of International Public Sector Accounting Standards Board, International Financial Reporting Standards or Generally Accepted Accounting Principles. Where a standard of GRAP has been issued but is not yet in effect, the college may select to apply the principles established in that standard in developing an appropriate Accounting Policy dealing with a particular section or event before applying paragraph 12 of the Standard of GRAP on Accounting Policies, Changes in Accounting Estimates and Errors.

• GRAP 20 Related Party Disclosures (Revised)• GRAP 32 Service Concession Arrangement Grantor - issued August 2013 • GRAP 34 Separate Financial Statements*• GRAP 35 Consolidated Financial Statements*• GRAP 36 Investments in associates and joint ventures*• GRAP 37 Joint arrangements*• GRAP 38 Disclosure of interest in other entities• GRAP 108 Statutory Receivables - issued September 2013• GRAP 109 Accounting by Principals and Agents - issued July 2015• GRAP 110 Living and non-living resources

*These standards may not be applicable to the college but are included for completeness of information in capacitating the college with information.The ASB Directive 5, paragraph 29, sets out the principles for the application of the GRAP 3 guidelines in the determination of the GRAP Reporting Framework hierarchy as set out in the standard of GRAP 3 on Accounting Policies, Changes in Accounting Estimates

and Errors.

Management has considered all of the above-mentioned GRAP Standards issued but not yet effective and anticipates that the adoption of these standards will not have a significant impact on the financial position, financial performance or cash flows of the college.

2. NET ASSETS

Included in the Net Assets of the college are the following Reserves that are maintained in terms of specific requirements:

2.1 Accumulated Surplus

Accumulated surplus comprise of rolled over funds from the current and prior years based on the recorded surplus or deficit for the period. The reserve is not cash backed.

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3. PROPERTY, PLANT AND EQUIPMENT

3.1 Initial Recognition

Property, Plant and Equipment are tangible non-current assets (including infrastructure assets) that are held for use in the production or supply of goods or services, rental to others, or for administrative purposes, and are expected to be used during more than one year.

The cost of an item of Property, Plant and Equipment is recognised as an asset if, and only if, it is probable that future economic benefits or service potential associated with the item will flow to the college, and if the cost or fair value of the item can be measured reliably.

Property, Plant and Equipment are initially recognised at cost on its acquisition date or in the case of assets acquired by grants or donations, deemed cost, being the fair value of the asset on initial recognition. The cost of an item of Property, Plant and Equipment is the purchase price and other costs attributable to bring the asset to the location and condition necessary for it to be capable of operating in the manner intended by the college. Trade discounts and rebates are deducted in arriving at the cost. The cost also includes the necessary costs of dismantling and removing the asset and restoring the site on which it is located.

When significant components of an item of Property, Plant and Equipment have different useful lives, they are accounted for as separate items (major components) of Property, Plant and Equipment.

Where an asset is acquired by the college for no or nominal consideration (i.e. a non-exchange transaction), the cost is deemed to be equal to the fair value of that asset on the date acquired.

The cost of an item of Property, Plant and Equipment acquired in exchange for non-monetary assets or monetary assets, or a combination of monetary and non-monetary assets is measured at the fair value of the asset given up, unless the fair value of the asset received is more clearly evident. If the acquired item could not be measured at its fair value, its cost is measured at the carrying amount of the asset given up.

Major spare parts and servicing equipment qualify as Property, Plant and Equipment when the college expects to use them during more than one period. Similarly, if the major spare parts and servicing equipment can be used only in connection with an item of Property, Plant and Equipment, they are accounted for as Property, Plant and Equipment.

3.2 Subsequent Measurement

Subsequent expenditure relating to Property, Plant and Equipment is capitalised if it is probable that future economic benefits or potential service delivery associated with the subsequent expenditure will flow to the college and the cost or fair value of the subsequent expenditure can be reliably measured. Subsequent expenditure incurred on an asset is only capitalised when it increases the capacity or future economic benefits associated with the asset. Where the college replaces parts of an asset, it derecognises the part of the asset being replaced and capitalises the new component.

Subsequently all Property Plant and Equipment are measured at cost, less accumulated depreciation and accumulated impairment losses.

Compensation from third parties for items of Property, Plant and Equipment that were impaired, lost or given up is included in the Statement of Financial Performance when the compensation becomes receivable.

3.3 Depreciation

Depreciation on assets other than land is calculated on cost, using the Straight-line Method, to allocate their cost or revalued amounts to their residual values over the estimated useful lives of the assets. The depreciation method used reflects the pattern in which the asset’s future economic benefits or service potential are expected to be consumed by the college. Each part of an item of Property, Plant and Equipment with a cost that is significant in relation to the total cost of the item is depreciated separately.

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The assets’ residual values, estimated useful lives and depreciation method are reviewed annually and adjusted prospectively, if appropriate, at each reporting date. Reviewing the useful life of an asset on an annual basis does not require the college to amend the previous estimate unless expectations differ from the previous estimate.

3.4 Land

Land is stated at historical cost and is not depreciated as it is deemed to have an indefinite useful life.

3.5 Incomplete Construction Work

Incomplete Construction Work is stated at historical cost. Depreciation only commences when the asset is available for use.

3.6 Derecognition

The carrying amount of an item of Property, Plant and Equipment is derecognised on disposal, or when no future economic benefits or service potential are expected from its use or disposal.

The gain or loss arising from the derecognition of an item of Property, Plant and Equipment is included in surplus or deficit when the item is derecognised. Gains are not classified as revenue.

Gains or losses are calculated as the difference between the carrying value of assets (cost less accumulated depreciation and accumulated impairment losses) and the proceeds from disposals are included in the Statement of Financial Performance as a gain or loss on disposal of Property, Plant and Equipment.

4. INTANGIBLE ASSETS


Identifiable non-monetary assets without physical substance are classified and recognised as Intangible Assets. The college recognises an Intangible Asset in its Statement of Financial Position only when it is probable that the expected future economic benefits or service potential that are attributable to the asset will flow to

Depreciation only commences when the asset is available for use, unless stated otherwise. The depreciation rates are based on the following estimated useful lives:

the college and the cost or fair value of the asset can be measured reliably.

Internally generated Intangible Assets are subject to strict recognition criteria before they are capitalised. Research expenditure is recognised as an expense as it is incurred. Costs incurred on development projects (relating to the design and testing of new or improved products) are recognised as Intangible Assets when the following criteria are fulfilled:

(a) It is technically feasible to complete the Intangible Asset so that it will be available for use;

(b) Management intends to complete the Intangible Asset and use or sell it;

(c) There is an ability to use or sell the Intangible Asset;

(d) It can be demonstrated how the Intangible Asset will generate probable future economic benefits;

(e) Adequate technical, financial and other resources to complete the development and to use or sell the Intangible Asset are available; and

(f) The expenditure attributable to the Intangible Asset during its development can be reliably measured. Other development expenditures that do not meet these criteria are recognised as an expense as incurred. Development costs previously recognised as an expense are not recognised as an asset in a subsequent period. Capitalised development costs are recorded as Intangible Assets and amortised from the point at which the asset is available for use. Development assets are tested for impairment annually, in accordance with GRAP 21 or GRAP 26.

Intangible Assets are initially recognised at cost. The cost of an Intangible Asset is the purchase price and other costs attributable to bring the Intangible Asset to the location and condition necessary for it to be capable of operating in the manner intended by the college, or where an Intangible Asset is acquired at no cost, or for a nominal cost, the cost shall be its fair value as at the date of acquisition. Trade discounts and rebates are deducted in arriving at the cost.

A s s e t C l a s s Ye a r s A s s e t C l a s s Ye a r s

LandImproved Property

BuildingsImprovements

Indefinite

50

OtherComputer EquipmentFurniture and FittingsMotor VehiclesWorkshop Equipment

4655

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Intangible Assets are annually tested for impairment as described in Accounting Policy 6 on Impairment of Assets, including Intangible Assets not yet available for use. Where items of Intangible Assets have been impaired, the carrying value is adjusted by the impairment loss, which is recognised as an expense in the period that the impairment is identified. The impairment loss is the difference between the carrying amount and the recoverable service amount.

The estimated useful life, residual values and amortisation method are reviewed annually at the end of the financial year. Any adjustments arising from the annual review are applied prospectively as a Change in Accounting Estimate in the Statement of Financial Performance.

The cost of an Intangible Asset acquired in exchange for non-monetary assets or monetary assets, or a combination of monetary and non-monetary assets, is measured at the fair value of the asset given up, unless the fair value of the asset received is more clearly evident. If the acquired item could not be measured at its fair value, its cost is measured at the carrying amount of the asset given up. If the acquired item’s fair value was not determinable, its deemed cost is the carrying amount of the asset(s) given up.

4.2 Subsequent Measurement, Amortisation and Impairment

After initial recognition, Intangible Assets are carried at cost less any accumulated amortisation and any accumulated impairment losses.

Expenditure on an intangible item that was initially recognised as an expense shall not be recognised as part of the cost of an Intangible Asset at a later date.

In terms of GRAP 31, Intangible Assets are distinguished between internally generated Intangible Assets and other Intangible Assets. It is further distinguished between indefinite or finite useful lives. Amortisation is charged on a Straight-line Basis over the Intangible Assets’ useful lives. The residual value of Intangible Assets with finite useful lives is zero, unless an active market exists. Where Intangible Assets are deemed to have indefinite useful lives, such Intangible Assets are not amortised. However, such Intangible Assets are subject to an annual impairment test.

Amortisation only commences when the asset is available for use, unless stated otherwise. The amortisation rates are based on the following estimated useful lives:

4.3 Derecognition

Intangible Assets are derecognised when the asset is disposed of or when there are no further economic benefits or service potential expected from the use of the asset. The gain or loss arising on the disposal or retirement of an Intangible Asset is determined as the difference between the proceeds of disposal and the carrying value and is recognised in the Statement of Financial Performance.

The College does not have any intangible assets.

5. INVESTMENT PROPERTY

The College does not own any investment property.

A s s e t C l a s s Ye a r s

Computer Software 5

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6. IMPAIRMENT OF ASSETS

The college classifies all assets held with the primary objective of generating a commercial return as Cash Generating Assets.

6.1 Impairment of Cash Generating Assets

The college assesses at each reporting date whether there is any indication that an asset may be impaired.If there is any indication that an asset may be impaired, the recoverable amount is estimated for the individual asset. If it is not possible to estimate the recoverable amount of the individual asset, the recoverable amount of the cash generating unit to which the asset belongs is determined.

The recoverable amount of an asset or a cash generating unit is the higher of its fair value less costs to sell and its value in use. The best evidence of fair value less cost to sell is the price in a binding sale agreement in an arm’s length transaction, adjusted for the incremental cost that would be directly attributable to the disposal of the asset.

Value in use of a cash-generating asset is the present value of the estimated future cash flows expected to be derived from the continuing use of an asset and from its disposal at the end of its useful life.

If the recoverable amount of an asset is less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. That reduction is an impairment loss.

An impairment loss of assets carried at cost less any accumulated depreciation or amortisation is recognised immediately in the Statement of Financial Performance.An impairment loss is recognised for cash generating units if the recoverable amount of the unit is less than the carrying amount of the unit. The impairment loss is allocated to reduce the carrying amount of the assets of the unit pro rata on the basis of the carrying amount of each asset in the unit.

The college assesses at each reporting date whether there is any indication that an impairment loss recognised in prior periods for assets may no longer exist or may have decreased. If any such indication exists, the recoverable amounts of those assets are estimated.The increased carrying amount of an asset attributable to a reversal of an impairment loss does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in prior periods.

A reversal of an impairment loss of assets carried at cost less accumulated depreciation or amortisation is recognised immediately in the Statement of Financial Performance.

6.2 Impairment of Non-cash Generating Assets

The college assesses at each reporting date whether there is any indication that an asset may be impaired.If there is any indication that an asset may be impaired, the recoverable service amount is estimated for the individual asset. If it is not possible to estimate the recoverable service amount of the individual asset, the recoverable service amount of the non-cash generating unit to which the asset belongs is determined.

The recoverable service amount of a non-cash generating asset is the higher of its fair value less costs to sell and its value in use. The value in use for a non-cash generating asset is the present value of the asset’s remaining service potential.

Fair value less costs to sell is the amount obtainable from the sale of an asset in an arm’s length transaction between knowledgeable, willing parties, less the costs of disposal.

If the recoverable service amount of an asset is less than its carrying amount, the carrying amount of the asset is reduced to its recoverable service amount. That reduction is an impairment loss.

An impairment loss of assets carried at cost less any accumulated depreciation or amortisation is recognised immediately in the Statement of Financial Performance.

An impairment loss is recognised for non-cash generating units if the recoverable service amount of the unit is less than the carrying amount of the unit. The impairment loss is allocated to reduce the carrying amount of the assets of the unit pro rata on the basis of the carrying amount of each asset in the unit.

The college assesses at each reporting date whether there is any indication that an impairment loss recognised in prior periods for assets may no longer exist or may have decreased. If any such indication exists, the recoverable service amounts of those assets are estimated.

The increased carrying amount of an asset attributable to a reversal of an impairment loss does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in prior periods.

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A reversal of an impairment loss of assets carried at cost less accumulated depreciation or amortisation is recognised immediately in the Statement of Financial Performance.

7. FINANCIAL INSTRUMENTS

The college has various types of Financial Instruments and these can be broadly categorised as Financial Assets, Financial Liabilities or Residual Interests in accordance with the substance of the contractual agreement. The college only recognises a Financial Instrument when it becomes a party to the contractual provisions of the instrument.

Initial Recognition

Financial Assets and Financial Liabilities are recognised on the college’s Statement of Financial Position when it becomes party to the contractual provisions of the instrument.

The college does not offset a Financial Asset and a Financial Liability unless a legally enforceable right to set off the recognised amounts currently exist and the college intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

Fair Value Methods and Assumptions

The fair values of Financial Instruments are determined as follows:

• The fair values of quoted investments are based on current bid prices.• If the market for a Financial Asset is not active (and for unlisted securities), the college establishes fair value by using valuation techniques. These include the use of recent arm’s length transactions, reference to other instruments that are substantially the same, discounted cash flow analysis, and option pricing models making maximum use of market inputs and relying as little as possible on entity-specific inputs.

The Effective Interest Rate Method

The Effective Interest Method is a method of calculating the amortised cost of a Financial Asset or a Financial Liability and of allocating the interest income or interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the Financial Instrument or, when appropriate, a shorter period to the net carrying amount of the Financial Asset or Financial Liability.

Amortised Cost

Amortised Cost is the amount at which the Financial Asset or Financial Liability is measured at initial recognition minus principal repayments, plus or minus the cumulative amortisation, using the Effective Interest Rate Method of any difference between that initial amount and the maturity amount, and minus any reduction for impairment or uncollectability.

7.1 Financial Assets – Classification

A Financial Asset is any asset that is a cash, a contractual right to receive cash or another financial asset from another entity.

In accordance with GRAP 104 the Financial Assets of the college are classified as follows into the three categories allowed by this standard:

• Financial Assets measured at Amortised Cost are non-derivative Financial Assets with fixed or determinable payments that are not quoted in an active market. They are included in Current Assets, except for maturities greater than 12 months, which are classified as Non-current Assets. Financial Assets at Amortised Cost are initially recognised at fair value plus transaction costs that are directly attributable to the acquisition or issue of the Financial Asset. After initial recognition, Financial Assets are measured at amortised cost, using the Effective Interest Rate Method less a provision for impairment.

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Cash includes cash-on-hand (including petty cash) and cash with banks (including call deposits). Cash Equivalents are short-term highly liquid investments, readily convertible into known amounts of cash, which are held with registered banking institutions with maturities of three months or less and are subject to an insignificant risk of change in value. For the purposes of the Cash Flow Statement, Cash and Cash Equivalents comprise cash-on-hand and deposits held on call with banks, net of bank overdrafts. The college categorises Cash and Cash Equivalents as Financial Assets at Amortised Cost.

7.3 Initial and Subsequent Measurement

7.3.1 Financial Assets:

Financial Assets measured at Amortised Cost

Financial Assets at Amortised Cost are initially measured at fair value plus transaction costs that are directly attributable to the acquisition or issue of the Financial Asset. Subsequently, these assets are measured at amortised cost using the Effective Interest Method less any impairment, with interest recognised on an Effective Yield Basis. Trade and Other Receivables (excluding Value Added Taxation, Prepayments and Operating Lease receivables), Loans to College Entities and Loans that have fixed and determinable payments that are not quoted in an active market are classified as Financial Assets at Amortised Cost.

7.3.2 Financial Liabilities:

Financial Liabilities held at Amortised CostAny other Financial Liabilities are classified as Other

The college has the following types of Financial Assets as reflected on the face of the Statement of Financial Position or in the Notes thereto:

7.2 Financial Liabilities – Classification

A Financial Liability is a contractual obligation to deliver cash or another Financial Assets to another entity.The college has the following types of Financial Liabilities as reflected on the face of the Statement of Financial Position or in the notes thereto:

Financial Liabilities (All Payables, Loans and Borrowings are classified as Other Liabilities) and are initially measured at fair value, net of transaction costs. Trade and Other Payables, Interest-bearing Debt including Finance Lease Liabilities, Non-interest-bearing Debt and Bank Borrowings are subsequently measured at amortised cost using the Effective Interest Rate Method. Interest expense is recognised in the Statement of Financial Performance by applying the effective interest rate. Prepayments are carried at cost less any accumulated impairment losses.

7.4 Impairment of Financial Assets

Financial Assets are assessed for indicators of impairment at the end of each reporting period. Financial Assets are impaired where there is objective evidence of impairment of Financial Assets (such as the probability of insolvency or significant financial difficulties of the debtor). If there is such evidence the recoverable amount is estimated and an impairment loss is recognised in accordance with GRAP 104.

T y p e o f F i n a n c i a l A s s e t C l a s s i f i c a t i o n i n t e r m s o f G R A P 1 0 4

Long-term ReceivablesReceivables from Exchange TransactionsReceivables from Non-exchange TransactionsBank, Cash and Cash Equivalents – Notice DepositsBank, Cash and Cash Equivalents – Call DepositsBank, Cash and Cash Equivalents – BankBank, Cash and Cash Equivalents – CashCurrent Portion of Long-term Receivables

Financial Assets at Amortised CostFinancial Assets at Amortised CostFinancial Assets at Amortised CostFinancial Assets at Amortised CostFinancial Assets at Amortised CostFinancial Assets at Amortised CostFinancial Assets at Amortised CostFinancial Assets at Amortised Cost

T y p e o f F i n a n c i a l A s s e t C l a s s i f i c a t i o n i n t e r m s o f G R A P 1 0 4

Payables from Exchange TransactionsPayables from Non-exchange Transactions

Financial Liabilities at Amortised CostFinancial Liabilities at Amortised Cost

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7.4.1 Financial Assets at Amortised Cost

Accounts Receivable encompass Long-term Debtors, Receivables from Exchange Transactions (Tuition Fee Debtors) and Receivables from Non-exchange Transactions (Other Debtors).

Initially Accounts Receivable are valued at fair value excluding transaction costs, and subsequently carried at amortised cost using the Effective Interest Rate Method. An estimate is made for doubtful debt based on past default experience of all outstanding amounts at year-end. Bad debts are written off the year in which they are identified as irrecoverable. Amounts receivable within 12 months from the date of reporting are classified as current.

A provision for impairment of Accounts Receivables is established when there is objective evidence that the college will not be able to collect all amounts due according to the original terms of receivables. The provision is made in accordance with GRAP 104 whereby the recoverability of accounts receivable is assessed individually and then collectively after grouping the assets in financial assets with similar credit risk characteristics. The amount of the provision is the difference between the Financial Asset’s carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. Future cash flows in a group of Financial Assets that are collectively evaluated for impairment are estimated on the basis of historical loss experience for assets with credit risk characteristics similar to those in the group. Cash flows relating to short-term receivables are not discounted where the effect of discounting is immaterial.

The carrying amount of the Financial Asset is reduced by the impairment loss directly for all Financial Assets carried at Amortised Cost with the exception of Tuition Fee Debtors, where the carrying amount is reduced through the use of an allowance account. When a Tuition Fee Debtors is considered uncollectible, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against revenue. Changes in the carrying amount of the allowance account are recognised in the Statement of Financial Performance.

7.5 Derecognition of Financial Assets

The college derecognises Financial Assets only when the contractual rights to the cash flows from the asset expires or it transfers the Financial Asset and substantially all the risks and rewards of ownership of the asset to another entity, except when Council approves the write-off of Financial Assets due to non-recoverability.

If the college neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the college recognises its retained interest in the asset and an associated liability for amounts it may have to pay. If the college retains substantially all the risks and rewards of ownership of a transferred Financial Asset, the college continues to recognise the Financial Asset and also recognises a collateralised borrowing for the proceeds received.

7.6 Derecognition of Financial Liabilities

The college derecognises Financial Liabilities when, and only when, the college’s obligations are discharged, cancelled or they expire.

The college recognises the difference between the carrying amount of the Financial Liability (or part of a Financial Liability) extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, in the Statement of Financial Performance.

8. INVENTORIES


Inventories comprise current assets held-for-sale, current assets for consumption or distribution during the ordinary course of business. Inventories are initially recognised at cost. Cost generally refers to the purchase price, plus taxes, transport costs and any other costs in bringing the Inventories to their current location and condition.

Where Inventory is manufactured, constructed or produced, the cost includes the cost of labour, materials and overheads used during the manufacturing process.Where Inventory is acquired by the college for no or nominal consideration (i.e. a non-exchange transaction), the cost is deemed to be equal to the fair value of the item on the date acquired.

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8.2 Subsequent Measurement

8.2.1 Consumable Stores and Finished Goods

Consumable stores inventories distributed at no charge or for a nominal charge and finished goods are valued at the lower of cost and current replacement costs (net amount that the college expects to realise from the sale on Inventory in the ordinary course of business). The cost is determined using the weighted average cost of items.

8.2.2 Other Arrangements

Redundant and slow-moving Inventories are identified and written down from cost to replacement cost with regard to their estimated economic or replacement cost. Replacement cost is the current cost to replace the item at year end. Differences arising on the measurement of such Inventory at the lower of cost and replacement cost are recognised in the Statement of Financial Performance in the year in which they arise. The amount of any reversal of any write-down of Inventories arising from an increase in current replacement cost is recognised as a reduction in the amount of Inventories recognised as an expense in the period in which the reversal occurs.

The carrying amount of Inventories is recognised as an expense in the period that the Inventory was distributed, written off or consumed, unless that cost qualifies for capitalisation to the cost of another asset.

9. REVENUE RECOGNITION

9.1 General

Revenue is derived from a variety of sources which include tuition fees, grants from other tiers of government and revenue from trading activities and other services provided.

The college recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits or service potential will flow to the college and when specific criteria have been met for each of the college’s activities as described below, except when specifically stated otherwise. The amount of revenue is not considered to be reliably measurable until all contingencies relating to the sale have been resolved. The college bases its estimates on historical results, taking into consideration the type of customer, the type of transaction and the specifics of each arrangement. Furthermore, services rendered are recognised by reference to the stage of completion of the transaction at the reporting date.

Revenue from Exchange Transactions refers to revenue that accrued to the college directly in return for services rendered / goods sold, the value of which approximates the consideration received or receivable. Revenue is measured at the fair value of the consideration received or receivable.

Revenue from Non-exchange Transactions refers to transactions where the college received revenue from another entity without directly giving approximately equal value in exchange. Revenue from non-exchange transactions is generally recognised to the extent that the related receipt or receivable qualifies for recognition as an asset and there is no liability to repay the amount.

9.2 Revenue from Exchange Transactions

9.2.1 Rentals Received

Revenue from the rental of facilities and equipment is recognised on a Straight-line Basis over the term of the lease agreement.

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9.2.2 Interest Earned

Interest earned on investments is recognised in the Statement of Financial Performance on the Time-proportionate Basis that takes into account the effective yield on the investment.

9.2.3 Sale of Goods

Revenue from the sale of goods is recognised when all the following conditions have been met:

(a) The college has transferred to the buyer the significant risks and rewards of ownership of the goods;

(b) The college retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;

(c) The amount of revenue can be measured reliably;

(d) It is probable that the economic benefits or service potential associated with the transaction will flow to the college; and

(e) The costs incurred or to be incurred in respect of the transaction can be measured reliably.Tuition fees are recognised over the period of instruction.

9.2.4 Services Rendered

When the outcome of a transaction involving the rendering of services can be estimated reliably, revenue associated with the transaction is recognised by reference to the stage of completion of the transaction at the reporting date. The outcome of a transaction can be estimated reliably when all the following conditions are satisfied:

- the amount of revenue can be measured reliably;- it is probable that the economic benefits or service potential associated with the transaction will flow to the College; - the stage of completion of the transaction at the reporting date can be measured reliably; and- the costs incurred for the transaction and the costs to complete the transaction can be measured reliably.

When services are performed by an indeterminate number of acts over a specified time frame, revenue is recognised on a straight line basis over the specified time frame unless there is evidence that some other method better represents the stage of completion. When a specific act is much more significant than any other acts, the recognition of revenue is postponed until the significant act is executed.

9.3 Revenue from Non-exchange Transactions

An inflow of resources from a Non-exchange Transaction, that meets the definition of an asset shall be recognised as an asset when it is probable that the future economic benefits or service potential associated with the asset will flow to the college and the fair value of the asset can be measured reliably. The asset shall be recognised as revenue, except to the extent that a liability is also recognised in respect of the same inflow.A present obligation arising from a Non-exchange Transaction that meets the definition of a liability will be recognised as a liability when it is probable that an outflow of economic benefit will be required to settle the obligation and a reliable estimate of the amount can be made.

9.3.1 Public Contributions

Donations and funding are recognised as revenue to the extent that the college has complied with any of the criteria, conditions or obligations embodied in the agreement. Where the agreement contains a stipulation to return the asset, other future economic benefits or service potential, in the event of non-compliance to these stipulations and would be enforced by the transferor, a liability is recognised to the extent that the criteria, conditions or obligations have not been met. Where such requirements are not enforceable, or where past experience has indicated that the transferor has never enforced the requirement to return the transferred asset, other future economic benefits or service potential when breaches have occurred, the stipulation will be considered a restriction and is recognised as revenue.Revenue from public contributions is recognised when all conditions associated with the contribution have been met or where the contribution is to finance property, plant and equipment, when such items of property, plant and equipment are brought into use.

Assets acquired from non-exchange transactions are measured at fair value in accordance with the Standards of GRAP.

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9.3.2 Government Grants and Receipts

Conditional grants, donations and funding are recognised as revenue to the extent that the college has complied with any of the criteria, conditions or obligations embodied in the agreement. Where the agreement contains a stipulation to return the asset, other future economic benefits or service potential, in the event of non-compliance to these stipulations and would be enforced by the transferor, a liability is recognised to the extent that the criteria, conditions or obligations have not been met. Where such requirements are not enforceable, or where past experience has indicated that the transferor has never enforced the requirement to return the transferred asset, other future economic benefits or service potential when breaches have occurred, the stipulation will be considered a restriction and is recognised as revenue.

Government grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the college with no future related costs, are recognised in the Statement of Financial Performance in the period in which they become receivable. Interest earned on investments is treated in accordance with grant conditions. If it is payable to the funder it is recorded as part of the creditor and if it is the college’s interest, it is recognised as interest earned in the Statement of Financial Performance.

Revenue is recognised when all conditions associated with the contribution have been met or where the contribution is to finance property, plant and equipment, when such items of property, plant and equipment are brought into use.

10. PROVISIONS

Provisions are recognised when the college has a present or constructive obligation as a result of past events, it is probable that an outflow of resources embodying economic benefits or service potential will be required to settle the obligation and a reliable estimate can be made of the obligation.

The best estimate of the expenditure required to settle the present obligation is the amount that the college would rationally pay to settle the obligation at the reporting date or to transfer it to a third party at that time and are determined by the judgment of the management of the college, supplemented by experience of similar transactions and, in some cases, reports from independent experts. The evidence considered includes any additional evidence provided by events after the reporting date. Uncertainties surrounding the amount to be recognised as a provision are dealt with by various means according to the circumstances. Where the provision being measured involves a large population of items, the obligation is estimated by weighting all possible outcomes by their associated probabilities.

Future events that may affect the amount required to settle an obligation are reflected in the amount of a provision where there is sufficient objective evidence that they will occur. Gains from the expected disposal of assets are not taken into account in measuring a provision. Provisions are not recognised for future operating losses. The present obligation under an onerous contract is recognised and measured as a provision. An onerous contract is a contract in which the unavoidable costs of meeting the obligations under the contract exceed the economic benefits expected to be received under it. The unavoidable costs under a contract reflect the least net cost of exiting from the contract, which is the lower of the cost of fulfilling it and any compensation or penalties arising from failure to fulfil it – this unavoidable cost resulting from the contract is the amount of the provision to be recognised.

Provisions are reviewed at reporting date and the amount of a provision is the present value of the expenditure expected to be required to settle the obligation. When the effect of discounting is material, provisions are determined by discounting the expected future cash flows that reflect current market assessments of the time value of money. The impact of the periodic unwinding of the discount is recognised in the Statement of Financial Performance as a finance cost as it occurs.

11. EMPLOYEE BENEFIT LIABILITIES

11.1 Short-term Employee Benefits

Remuneration to employees is recognised in the Statement of Financial Performance as the services are rendered, except for non-accumulating benefits which are only recognised when the specific event occurs.The college has opted to treat its provision for leave pay as an accrual.

The costs of all short-term employee benefits such as leave pay, are recognised during the period in which the employee renders the related service. The liability for leave pay is based on the total accrued leave days at year end and is shown as a creditor in the Statement of Financial Position. The college recognises the expected cost of performance bonuses only when the college has a present legal or constructive obligation to make such payment and a reliable estimate can be made.

11.1.1 Defined Contribution Plans

A Defined Contribution Plan is a plan under which the college pays fixed contributions into a separate entity. The college has no legal or constructive obligation to pay further contributions if the fund does not hold sufficient assets to pay all employees the benefits relating to service in the current or prior periods.

27

The college’s contributions to the defined contribution funds are established in terms of the rules governing those plans. Contributions are recognised in the Statement of Financial Performance in the period in which the service is rendered by the relevant employees. The college has no further payment obligations once the contributions have been paid. The contributions are recognised as employee benefit expense when they are due. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in the future payments is available.

12. LEASES

12.1 Classification

Leases are classified as Finance Leases where substantially all the risks and rewards associated with ownership of an asset are transferred to the college.Leases of property, plant and equipment, in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as Operating Leases.

Rental revenue from Operating Leases is recognised on an ad-hoc Basis since lease agreements are either not in place or not enforced.

13. UNAUTHORISED EXPENDITURE

Unauthorised expenditure means the overspending of an approved budget without the necessary approvals per the delegated limits, or expenditure incurred not in accordance with the purpose of a cost centre.All expenditure relating to unauthorised expenditure is recognised as an expense in the statement of financial performance in the year that the expenditure was incurred. The expenditure is classified in accordance with the nature of the expense, and where recovered, it is subsequently accounted for as revenue in the statement of financial performance.

If expenditure is classified as satisfying the criteria for 2 or more of the following: Unauthorised, irregular or fruitless and wasteful, it is only reported under one of the headings in the following descending order: Unauthorised expenditure; Irregular expenditure and then Fruitless and wasteful expenditure.

14. IRREGULAR EXPENDITURE

Irregular expenditure is expenditure that is contrary to the CET Act or any applicable legislation, or any regulations made in terms of the CET Act, or is in contravention of the College’s Supply Chain Management Policy, or any other College policy. Irregular expenditure excludes unauthorized expenditure. Irregular expenditure is accounted for as an expense, classified in accordance with the nature of the expense, and where recovered, it is subsequently accounted for as revenue in the statement of financial performance.

28

15. FRUITLESS AND WASTEFUL EXPENDITURE

Fruitless and Wasteful Expenditure is expenditure that was made in vain and would have been avoided had reasonable care been exercised. All expenditure relating to Fruitless and wasteful expenditure is accounted for as expenditure in the Statement of Financial Performance in the year that the expenditure was incurred. The expenditure is classified in accordance with the nature of the expense, and where recovered, it is subsequently accounted for as revenue in the Statement of Financial Performance.

16. CHANGES IN ACCOUNTING POLICIES, ESTIMATES AND ERRORS

Changes in Accounting Policies that are affected by management have been applied retrospectively in accordance with GRAP 3 requirements, except to the extent that it is impractical to determine the period-specific effects or the cumulative effect of the change in policy. In such cases the college restated the opening balances of assets, liabilities and net assets for the earliest period for which retrospective restatement is practical. Details of Changes in Accounting Policies are disclosed in the Notes to the Annual Financial Statements where applicable.

Changes in Accounting Estimates are applied prospectively in accordance with GRAP 3 requirements. Details of changes in estimates are disclosed in the Notes to the Annual Financial Statements where applicable.

Correction of Errors is applied retrospectively in the period in which the error has occurred in accordance with GRAP 3 requirements, except to the extent that it is impractical to determine the period-specific effects or the cumulative effect of the error. In such cases the college shall restate the opening balances of assets, liabilities and net assets for the earliest period for which retrospective restatement is practical. Details of Correction of Errors are disclosed in the Notes to the Annual Financial Statements where applicable.

17. TREATMENT OF ADMINISTRATION AND OTHER OVERHEAD EXPENSES

The costs of internal support services are transferred to the various services and departments to whom resources are made available.

18. CONTINGENT ASSETS AND CONTINGENT LIABILITIES

Contingent Liabilities represent a possible obligation that arises from past events and whose existence will be confirmed only by an occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the college. A contingent liability can also arise as a result of a present obligation that arises from past events but which is not recognised as a liability either because it is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation or the amount of the obligation cannot be measured with sufficient reliability.

Contingent Assets represent possible assets that arise from past events and whose existence will be confirmed only by an occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the college.

Contingent Assets and Contingent Liabilities are not recognised. Contingencies are disclosed in Notes to the Annual Financial Statements.

19. COMMITMENTS

Commitments are future expenditure to which the college committed and that will result in the outflow of resources. 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. A distinction is made between capital and current commitments.

29

Commitments are disclosed for:

• Approved and contracted commitments, where the expenditure has been approved and the contract has been awarded at the reporting date, where disclosure is required by a specific standard of GRAP.

• Approved but not yet contracted commitments, where the expenditure has been approved and the contract has yet to be awarded or is awaiting finalisation at the reporting date.

• Items are classified as commitments where the college commits itself to future transactions that will normally result in the outflow of resources.

• Contracts that are entered into before the reporting date, but goods and services have not yet been received are disclosed in the disclosure Notes to the Annual Financial Statements.

• Other commitments for contracts that are non- cancellable or only cancellable at significant cost, should relate to something other than the business of the college.

20. RELATED PARTIES

Individuals as well as their close family members, and/or entities are related parties if one party has the ability, directly or indirectly, to control or jointly control the other party or exercise significant influence over the other party in making financial and/or operating decisions. Management is regarded as a related party and comprises the Councillors, Principal, Deputy Principals and Chief Financial Officer.

21. EVENTS AFTER THE REPORTING DATE

Events after the reporting date that are classified as adjusting events have been accounted for in the Annual Financial Statements. The events after the reporting date that are classified as Non-adjusting Events after the Reporting Date have been disclosed in Notes to the Annual Financial Statements.

22. COMPARATIVE INFORMATION

When the presentation or classification of items in the Annual Financial Statements is amended, prior period comparative amounts are reclassified. The nature and reason for the reclassification is disclosed.

30

1. GENERAL INFORMATION

Boland TVET College is a Public Continuing Education and Training College, established under the Continuing Education and Training Act No 16 of 2006, in Stellenbosch, Western Cape Province. The addresses of its registered office and principal place of business are disclosed under “General Information” included in the Annual Financial Statements and in the introduction of the Annual Report. The principal activities of the college are disclosed in the Annual Report and are prescribed by the Continuing Education and Training Act.

A conservative effort to minimise stock at year end was made by outsourcing of residence (meals), as well as minimizing the ordering of stock in the last quarter. The carrying amount of inventory is recognised as an expense in the period that the inventory was distributed, written off or consumed.Boland College treat textbooks as inventory which is “sold” when distributed to students as part of the all-inclusive tuition fee (property of student, not College. Textbook stock-on hand was kept for distribution in 2018.The cost of Inventories recognised as an expense includes:

Inventories are held and measured at the lower of Cost and Current Replacement Cost. No write downs of Inventory to Net Realisable Value were required. No Inventories have been pledged as collateral for liabilities of the college.

2 . I N V E N T O R I E S

2 0 1 7R

2 0 1 6R

Consumable StoresTotal Inventories

Consumable stores include:Text booksStationery/ink cartridgesCleaning and kitchen stock

699,982699,982

645,26918,78635,927

203,847203,847

-131,527

72,320

699,982 203,847

T h e c o s t o f I n v e n t o r i e s r e c o g n i s e d a s a n e x p e n s e i n c l u d e s :

2 0 1 7R

2 0 1 6R

Cost of inventory used to conduct maintenance during the year and included in the repairs and maintenance expense line item

Cost of inventory consumed in the ordinary course of business and recognised in the consumables expense line item during the year

Cost of fuel and oil inventory utilised during the year and recognised in the fuel and oil expense line item during the year

Cost of inventory consumed in the ordinary course of business and recognised in the cleaning expense line item during the year

Cost of inventory consumed in the ordinary course of business and recognised in the printing and stationary expense line item during the year

5,489,433

17,284,319

255,001

793,930

3,091,151

6,872,159

24,779,933

303,456

1,021,639

2,315,868

26,913,835 35,293,055

NOTES TO THE FINANCIAL STATEMENTSF O R T H E Y E A R E N D E D 3 1 D E C E M B E R 2 0 1 7

31

3 . R E C E I VA B L E S F R O M E X C H A N G E T R A N S A C T I O N S

As at 31 December 2017G r o s s

B a l a n c e sR

P r o v i s i o n f o r I m p a i r m e n t

R

N e tB a l a n c e s

R

Student DebtorsStaff DebtorsProvincial GovernmentNational GovernmentPrepaid ExpensesSundry DebtorsMunicipal Deposits

15,275,805312,265

2,576,0952,422,694

260,8371,258,502

69,260

926,269-

102,000947,881

-101,683

-

14,349,536312,265

2,474,0951,474,813

260,8371,156,818

69,260

Total Receivables from Exchange Transactions 22,175,458 2,077,833 20,097,625

The college did not pledge any of its receivables as security for borrowing purposes.

3 . R E C E I VA B L E S F R O M E X C H A N G E T R A N S A C T I O N S

G r o s s B a l a n c e s

R


R


R

As at 31 December 2016Student DebtorsStaff DebtorsProvincial GovernmentNational GovernmentPrepaid ExpensesSundry DebtorsMunicipal DepositsOther Receivables

2,221,10452,132

8,822,4163,737,257

325,413568,315114,360

32,809

1,306,355----

137,304--

914,75052,132

8,822,4163,737,257

325,413431,010114,360

32,809

Total Receivables from Exchange Transactions 15,873,807 1,443,659 14,430,148

3.1 Ageing of Receivables from Exchange Transactions

C u r r e n t P a s t D u e T o t a l

As at 31 December 2017 0 - 3 0 d a y s 3 1 - 6 0 D a y s 6 1 - 9 0 D a y s + 9 0 D a y s

Student DebtorsGross BalancesLess: Provision for ImpairmentNet Balances

Staff Debtors:Gross BalancesLess: Provision for ImpairmentNet Balances

Provincial Government:Gross BalancesLess: Provision for ImpairmentNet Balances

National Government:Gross Balances Less: Provision for ImpairmentNet Balances

Prepaid Expenses:Gross BalancesLess: Provision for ImpairmentNet Balances

Sundry Debtors:Gross BalancesLess: Provision for ImpairmentNet Balances

--0

342.32-

342

2,401,345.00-

2,401,345

265,114-

265,114

180,191.42-

180,191

509,388-

509,388

---

---

---

125,103-

125,103

---

323,502-

323,502

---

---

---

1,180-

1,180

---

96,372-

96,372

15,275,805926,269

14,349,536

311,923-

311,923

174,750102,000

72,750

2,031,297947,881

1,083,416

80,645-

80,645

329,240101,683227,556

15,275,805926,269

14,349,536

312,265-

312,265

2,576,095102,000

2,474,095

2,422,695947,881

1,474,814

260,837-

260,837

1,258,502101,683

1,156,818

32

As at 31 December 2017 Receivables of R16,741,245 were past due but not impaired. The age analysis of these Receivables are as follows:



Municipal Deposits:Gross BalancesLess: Provision for ImpairmentNet Balances

---

---

---

69,260-

69,260

69,260-

69,260



All Receivables:Gross BalancesLess: Provision for ImpairmentNet Balances

3,356,380-

3,356,380

448,605-

448,605

97,552-

97,552

18,272,9212,077,833

16,195,087

22,175,4582,077,833

20,097,625



Student Debtors:Gross BalancesLess: Provision for ImpairmentNet Balances

Staff Debtors:Gross BalancesLess: Provision for ImpairmentNet Balances

Provincial Government:Gross BalancesLess: Provision for ImpairmentNet Balances

National Government:Gross Balances Less: Provision for ImpairmentNet Balances

Prepaid Expenses:Gross BalancesLess: Provision for ImpairmentNet Balances

Sundry Debtors:Gross BalancesLess: Provision for ImpairmentNet Balances

---

---

---

---

---

---

---

15,677-

15,677

5,253,499-

5,253,499

1,505,640-

1,505,640

325,413-

325,413

161,727137,304

24,423

---

7,823-

7,823

---

3,470-

3,470

---

12,240-

12,240

2,221,104.401,306,355

914,750

28,632-

28,632

3,568,917-

3,568,917

2,228,147-

2,228,147

---

394,348-

394,348

2,221,104.401,306,355

914,750

52,132-

52,132

8,822,416-

8,822,416

3,737,257-

3,737,257

325,413-

325,413

568,315137,304431,011

33

As at 31 December Receivables of R14,430,148 were past due but not impaired. The age analysis of these Receivables are as follows:

The provision for bad debts is based on management’s experience of debtors. Reference is made to NSFAS receivables still outstanding at year end. Based on management’s experience, many of the debtors are expected to settle outstanding amounts during the next year’s registration process or through NSFAS allocations received during the first semester of the new year. Only receivables outstanding for more than 12 months are considered for impairment.



Municipal Deposits:Gross BalancesLess: Provision for ImpairmentNet Balances

Other Receivables:Gross BalancesLess: Provision for ImpairmentNet Balances

---

---

---

32,809-

32,809

---

---

114,360-

114,360

---

114,360-

114,360

32,809-

32,809




---

7,294,765137,304

7,157,461

23,533-

23,533

8,555,5081,306,3557,249,154

15,873,8071,443,659

14,430,148

3.2 Reconciliation of the Provision for Impairment

2 0 1 7R

2 0 1 6R

Balance at beginning of yearImpairment Losses recognisedImpairment Losses reversedAmounts written off as uncollectable

1,443,6595,644,250(258,560)

(4,751,516)

1,622,5791,443,659(264,378)

(1,358,200)

Balance at end of year 2,077,833 1,443,659

3.3 Ageing of impaired Receivables from Exchange Transactions

P a s t D u e :2 0 1 7

R2 0 1 6

R

31 - 60 Days+ 90 Days

-2,077,833

137,3041,306,355

Total 2,077,833 1,443,659

3.4 Derecognition of Financial Assets

T h e c r e d i t q u a l i t y o f t r a d e a n d o t h e r2 0 1 7

R2 0 1 6

R

Student DebtorsStaff DebtorsProvincial GovernmentNational GovernmentPrepaid ExpensesSundry DebtorsMunicipal DepositsOther Receivables

MediumMedium

HighHighHigh

MediumHighHigh

14,349,536312,265

2,474,0951,474,813

260,8371,156,818

69,260-

914,75052,132

8,822,4163,737,257

325,413431,010114,360

32,809

Total 20,097,625 14,430,148

34

Credit quality of financial assets carried at amortised costMethod of determining credit quality of other non-current financial assets

The credit quality of trade and other receivables from exchange transactions are determined and monitored with reference to historical payment trends. Accordingly the credit quality of the customers included in the balance of trade and other receivables from exchange transactions is determined internally through application of the College’s own credit policy. Based on the evaluation of the historical payment trends, customers included in the balance are categorised into the following:

High credit quality - Customers included in this category have evidenced no defaults or breaches in the contractual repayments.Medium credit quality - Customers included in this category are prone to late payments, but seldomly default on the entire balance owing.Low credit quality - Customers included in this balance includes customers that frequently default on their outstanding balances and breach contract. No external credit quality determination have been performed.

The college does not hold deposits or other security for its Receivables.None of the Receivables have been pledged as security for the college’s financial liabilities.

As at 31 December Receivables of R12,383,341 were past due but not impaired. The age analysis of these Receivables are as follows:

4. RECEIVABLES FROM NON-EXCHANGE TRANSACTIONS


R


R


R

As at 31 December 2017Statutory Receivable: Government Grants and SubsidiesSundry Debtors

12,383,341- -

12,383,341.00-

Total Receivables from Non-exchange Transactions 12,383,341 - 12,383,341


R


R


R

As at 31 December 2016Statutory Receivable: Government Grants and Subsidies 10,834,000 - 10,834,000

Total Receivables from Non-exchange Transactions 10,834,000 - 10,834,000

4.1 Ageing of Receivables from Non-exchange Transactions



Statutory Receivable: Government Grants and Subsidies:Gross BalancesLess: Provision for ImpairmentNet Balances

12,383,341.00-

12,383,341

---

---

---

12,383,341-

12,383,341




12,383,341-

12,383,341

---

---

---

12,383,341-

12,383,341

35

As at 31 December 2016 Receivables of R10,834,000 were past due but not impaired. The age analysis of these Receivables are as follows:

For the purposes of the Statement of Financial Position and the Cash Flow Statement, Cash and Cash Equivalents include Cash-on-Hand, Cash in Banks and Investments in Money Market Instruments.

Call Deposits are investments with a maturity period of less than 3 months and earn variable interest rates.



Statutory Receivable: Government Grants and Subsidies:Gross BalancesLess: Provision for ImpairmentNet Balances

10,834,000-

10,834,000

---

---

---

10,834,000-

10,834,000




10,834,000-

10,834,000

---

---

---

10,834,000-

10,834,000

5 . C A S H A N D C A S H E Q U I VA L E N T S

2 0 1 7R

2 0 1 6R

Current InvestmentsBank AccountsCash and Cash Equivalents

845,8592,405,394

1,100

581,3798,881,580

1,100

Total Bank, Cash and Cash Equivalents 3,252,354 9,464,059

5.1 Current Investment Deposits

2 0 1 7R

2 0 1 6R

Call Deposits 845,859 581,379

Total Current Investment Deposits 845,859 581,379

36

5.2 Bank Accounts

2 0 1 7R

2 0 1 6R

Cash in Bank 2,405,394 8,881,580

Total Bank Accounts 2,405,394 8,881,580

T h e c o l l e g e h a s t h e f o l l o w i n g b a n k a c c o u n t s :

2 0 1 7R

2 0 1 6R

Primary Bank AccountStellenbosch: 4052412057 - Current AccountCash book balance at beginning of yearCash book balance at end of year

Bank statement balance at beginning of yearBank statement balance at end of year

Stellenbosch: 4086361078 - Current AccountCash book balance at beginning of yearCash book balance at end of year


Stellenbosch: 4087794731 - Current Account CLCCash book balance at beginning of yearCash book balance at end of year


Stellenbosch: Savings AccountsCash book balance at beginning of yearCash book balance at end of year


Stellenbosch: 9288289217 - Depositor PlusCash book balance at beginning of yearCash book balance at end of year


Stellenbosch: 4078879219 - Student Deposits - Current AccountCash book balance at beginning of yearCash book balance at end of year


Stellenbosch: 4078880852 - Student Debit Orders - Current AccountCash book balance at beginning of yearCash book balance at end of year


6,518,6461,703,497

6,518,6461,703,497

6,81467,204

6,81467,204

--

--

29,15820,760

29,15820,760

2,165,47717,206

2,165,47717,206

96,585185,023

96,585185,023

63,7885,997

63,7885,997

10,542,4666,518,646

10,542,4666,518,646

1,2746,814

1,2746,814

367,472-

367,472-

17,08829,158

17,08829,158

9,245,5212,165,477

9,245,5212,165,477

148,47296,585

148,47296,585

177,56263,788

177,56263,788

37

The following investments were pledge as collateral for:32 Day Notice Deposit - 2068049430: Pledge as collateral against DBSA bond (3 month installments) Money Market Investment Drakenstein Municipality - Municipal Deposits at bank

32 Day Notice Deposit - 9331592832: Tsebo food services for capital investments - pledged amount equivalent of 1 monthly contract value The college did not pledge any of its Cash and Cash Equivalents as collateral for its financial liabilities.

No restrictions have been imposed on the college in terms of the utilisation of its Cash and CashEquivalents.

College is contractually restricted from using National Skills and WCED/SETA funding for purposes other than those stipulated in the respective contracts with the funders.

5.3 Cash and Cash Equivalents

2 0 1 7R

2 0 1 6R

Cash Floats and Advances 1,100 1,100

Total Cash on hand in Cash Floats, Advances and Equivalents 1,100 1,100

2 0 1 7R

2 0 1 6R

Stellenbosch: 4078880909 - National Skills FundCash book balance at beginning of yearCash book balance at end of year


Cash and cash equivalents pledged as collateral32 Day Notice Deposit - 2068049430Money Market Investment Drakenstein Municipality32 Day Notice Deposit - 9331592832Total

Cash and cash equivalents that are not available for use by the collegeWCED/SETA StipendsNational Skills FundInfrastructure grant 2014/2015infrastructure grant 2015/2016Total

1,111405,707

1,111405,707

361,52853,313

403,480818,321

-405,707

00

405,707

606,7411,111

606,7411,111

342,49650,162

-392,658

7,194,9211,111

436,6551,244,5128,877,200

38

6 . P R O P E R T Y, P L A N T A N D E Q U I P M E N T

D e s c r i p t i o n L a n d B u i l d i n g sC o m p u t e r

E q u i p m e n t

F u r n i t u r e

a n d

F i t t i n g s

P l a n t ,

M a c h i n e r y

a n d

E q u i p m e n t

M o t o r

Ve h i c l e s

M i n o r

A s s e t sT o t a l

R R R R R R R R

Carrying values at

01 January 2017

Cost

- Completed Assets

- Under Construction

Accumulated

Depreciation:

Acquisitions

Capital under

Construction -

Additions:

Depreciation:

Carrying value of

Disposals:

- Cost

- Accumulated

Impairment Losses

- Accumulated

Depreciation

Capital under

Construction -

Completed

Other Movements

Carrying values at

31 December 2017

Cost

- Completed Assets

- Under Construction

Accumulated

Impairment Losses

Accumulated

Depreciation:

71,033,034

71,033,034

71,033,034

-

-

-

-

-

-

-

-

-

-

-

71,033,034

71,033,034

71,033,034

-

-

-

155,905,081

172,657,480

169,367,066

3,290,414

(16,752,398)

69,346

492,513

(4,227,705)

-

-

-

-

(3,782,927)

3,782,927

152,239,236

173,219,339

173,219,339

-

-

(20,980,103)

7,635,799

19,428,887

19,428,887

-

(11,793,088)

432,819

-

(2,545,162)

(5,666)

(2,087,805)

-

2,082,139

-

-

5,517,789

17,773,901

17,773,901

-

-

(12,256,112)

10,365,969

18,230,201

18,230,201

-

(7,864,232)

81,436

-

(1,604,744)

(5,199)

(75,479)

-

70,280

-

-

8,837,462

18,236,158

18,236,158

-

-

(9,398,696)

4,816,237

7,115,393

7,115,393

-

(2,299,156)

26,463

-

(750,294)

-

(36,300)

-

36,300

-

-

4,092,406

7,105,556

7,105,556

-

-

(3,013,150)

64,498

114,271

114,271

-

(49,773)

-

-

(9,985)

-

-

-

-

-

-

54,513

114,271

114,271

-

-

(59,758)

-

-

-

-

-

(0)

-

-

-

-

-

-

-

-

(0)

(0)

(0)

-

-

-

249,820,619

288,579,266

285,288,852

3,290,414

(38,758,647)

610,063

492,513

(9,137,890)

(10,865)

(2,199,583)

-

2,188,718

(3,782,927)

3,782,927

241,774,440

287,482,259

287,482,259

-

-

(45,707,819)

39

PPE for which the College does not have the legal title, but has control:Legal title vests in Department of Public Works

Terms and conditionsThe following properties are currently used by the college:

CALEDON College Street ERF 276 & ERF 297Property owned by Boland College, but utilised by WCED as per arrangement

CALEDON Koalisie Street, ERF 1114Property owned by WCED, but utilised by Boland College as per arrangement

The College entered into an arrangement with the Western Cape Education Department whereby a property owned by the College (College Street, ERF 276 & ERF 297) is utilised by WCED and the College utilise the property owned by WCED (Koalisis Street). The College has reflected the value of the property it owns, as well as

6 . P R O P E R T Y, P L A N T A N D E Q U I P M E N T ( C o n t i n u e d )

Description L a n d B u i l d i n g s C o m p u t e r E q u i p m e n t

F u r n i t u r e a n d

F i t t i n g s

P l a n t , M a c h i n e r y

a n d E q u i p m e n t

M o t o r Ve h i c l e s

M i n o r A s s e t s T o t a l

R R R R R R R R

Carrying values as per 01 January 2016 Audited AFSCost- Completed Assets- Under ConstructionAccumulated Depreciation:

Correction of ErrorCarrying Value Adjustment of newly verified asset registerCost Price of Computer Equipment CorrectionsAcc. Depreciation of Computer Equipment CorrectionsCost Price of Furniture & Fittings CorrectionsAcc. Depreciation of Furniture & Fittings CorrectionsAcc. Depreciation Adjustment for Review of EUL of Assets

Carrying values at 01 January 2016Cost- Completed Assets- Under ConstructionCorrection of error (Note 39)Accumulated Impairment LossesAccumulated Depreciation:

AcquisitionsCapital under Construction - Additions:

Depreciation:

Carrying value of Disposals:- Cost- Accumulated Depreciation

Capital under Construction - CompletedOther Movements

Carrying values at 31 December 2016Cost- Completed Assets- Under ConstructionAccumulated Impairment LossesAccumulated Depreciation:

71,033,03471,033,03471,033,034

--

-------

71,033,03471,033,03471,033,034

----

--

-

---

--

71,033,03471,033,03471,033,034

---

150,684,851163,375,942158,833,362

4,542,580(12,691,091)

10,14810,148

-----

150,694,999163,375,947158,833,367

4,542,580--

(12,680,948)

468,9218,812,612

(4,071,450)

---

(10,064,778)10,064,778

155,905,081172,657,480169,367,066

3,290,414-

(16,752,398)

3,274,38826,638,38626,638,386

-(23,363,998)

6,534,4121,112,969

(4,859,336)4,859,336

--

5,421,442

9,808,80020,041,01620,041,016

---

(10,232,216)

294,283-

(2,460,910)

(906,412)(906,412)

-

--

7,635,79919,428,88719,428,887

--

(11,793,088)

6,206,66321,554,26321,554,263

-(15,347,600)

5,234,6631,241,195

--

(9,888,379)9,089,53

4,792,313

11,441,32517,745,37017,745,370

---

(6,304,044)

513,574-

(1,582,127)

(6,803)(28,743)

21,940

--

10,365,96918,230,20118,230,201

--

(7,864,232)

2,090,4966,700,5776,700,577

-(4,610,082)

1,876,624618,529

----

1,258,096

3,967,1205,861,4515,861,451

---

(1,894,331)

1,479,757-

(630,640)

-(225,814)

225,814

--

4,816,2377,115,3937,115,393

--

(2,299,156)

56,173298,766298,766

-(242,593)

18,323(15,988)

----

34,311

74,496114,271114,271

---

(39,775)

--

(9,997)

---

--

64,498114,271114,271

--

(49,773)

-

-------

--

-

---

--

------

233,345,605289,600,968285,058,388

4,542,580(56,255,364)

13,674,1692,966,853

(4,859,336)4,859,336

(9,888,379)9,089,534

11,506,162

247,019,774278,171,089273,628,509

4,542,580--

(31,151,315)

2,756,5348,812,612

(8,755,124)

(13,177)(1,160,969)

1,147,791

(10,064,778)10,064,778

249,820,619288,579,266285,288,852

3,290,414-

(38,758,647)

the Fair Value of the property it uses but does not have legal title to.

The Market Values as at 31 December 2016 (previous valuation 2013) of all the properties that the College recognises on its Balance Sheet are listed below.

2016 2013

CALEDONPAARLPAARLPAARLSTELLENBOSCHSTRANDWORCESTERWORCESTERSTELLENBOSCH

College StreetDrakensteinPaarlbergHuis BruwerVan Riebeeck StreetAerodrome StreetRainier StreetDurban Street85 - 87 Birdstreet

College StreetHospital Street,Cnr Hospital, Breede & PleinstreetHospital Street,Van Riebeeck Street,71 Aerodrome Street, Strandvale,Rainier Street,Durban Street85 Bird Street,

ERF 276 & ERF 297ERF 1019, 1020, 1021 & ERF 1023ERF 17258 & 19517ERF 9018ERF 13072 & 13073 *ERF 9798ERF 20800ERF1688ERF 4431

T24224/1997T24249/1994 & T24835/2010T24249/1994T24249/1994T21638/1996 & T24835/2010T24835/2010 & T32007/1993T36523/1986 & T90269/2004T21097/1994T25137/2004

6,200,00045,900,00020,600,00010,200,00097,100,00032,900,00076,900,000

1,100,00030,100,000

6,360,0008,500,000

34,100,0008,400,000

64,600,00031,200,00050,000,000

320,00022,600,000

321,000,000 226,080,000

40

6.6 Delayed Projects

No projects that are currently in progress are experiencing significant delays.

6 PROPERTY, PLANT AND EQUIPMENT (Continued)

6.1 Gross Carrying Amount of Property, Plant and Equipment that is fully depreciated and still in use

There are no Property, Plant and Equipment that is fully depreciated at year-end and still in use by

6.2 Carrying Amount of Property, Plant and Equipment re-tired from active use and not classified as a Discontinued Operation

No Property, Plant and Equipment were retired from active use and not classified as a Discontinued Operation during the financial year.

6.5 Calculation of Cash Flow:

2 0 1 7R

2 0 1 6R

Acquisitions per ReconciliationTotal Purchase of Property, Plant and Equipment

(1,102,577)(1,102,577)

(11,569,146)(11,569,146)

Disposals per ReconciliationLess Gains / Losses on Disposal of Capital Assets Refer Note 38Total Proceeds on Disposal of Property, Plant and Equipment

10,865(17,514)(6,649)

13,177(7,059)

6,118

6.7 Expenditure incurred to Repair and Maintain Property, Plant and Equipment

The following specific costs included in the amount of Repairs and Maintenance disclosed in Note 25 were incurred by entity during the reporting period:

2 0 1 7R

2 0 1 6R

Land and Buildings- Contracted Services- Inventory Consumed- Other Operational Costs

Computer Hardware/Equipment- Inventory Consumed

Other Assets- Inventory Consumed

Furniture And Fittings- Contracted Services- Inventory Consumed

Plant & Equipment- Contracted Services- Inventory Consumed

Motor Vehicles - General- Inventory Consumed

5,160,4044,802,620

328,02929,75441,55341,553

2,9802,980

157,247157,247

(0)99,35799,357

-27,89127,891

6,295,478-

6,295,478-

116,754116,754

1,9961,996

289,537-

289,537156,391

-156,391

12,00312,003

Total Expenditure incurred to Repair and Maintenance 5,489,433 6,872,159

6.3 Assets pledged as security

The college did not pledge any of its Property, Plant or Equipment as security.

6.4 Land and Buildings carried at Fair Value

The college’s Land and Buildings are accounted for according to the cost model and therefore no fair value has been determined.

41

Performance Bonus

Pay Progression cycle runs over a continuous period of twelve months commencing on 01 April of a particular year. Only an employee:

Who has completed a continuous period of twelve months of his/her salary notch on 31 March of a financial year and Who performed acceptably in line with the Staff Management and Development system (SPDMS) will qualify for a pay progression, which, if justified, will be paid annually after 1 July of each year.Pay Progression is only applicable to staff who has not reached their top notch yet. Performance Bonus to a maximum of 10 % and 18 % of the employee’s basic salary (annual) may be considered in recognition of an overall performance rating of 4 and 5 respectively. The payment of these cash bonuses is not guaranteed and is dependent on the college/department having sufficient financial resources to pay them. All submissions are subjected to moderation by the PM Moderation Committee.

7 . PAYA B L E S F R O M E X C H A N G E T R A N S A C T I O N S

2 0 1 7R

2 0 1 6R

Trade CreditorsClass Fees Received In AdvanceOther CreditorsBursary FundHousing Contribution ProvisionNSFAS Credits (students)Net Pay ControlStaff Leave Provision

3,935,521924,776212,492

(0)1,460,6003,929,298

521,238528,398

6,000,834389,480

1,891,0301,684,712

593,5701,428,506

466,268233,236

Total Payables 11,512,323 12,687,636

7.1 Provisions

Reconcilliation of Movement of Provision - 2017

P r o v . f o r L e a v e P a y

R

H o u s i n g C o n t r .

R

L o n g S e r v i c e Aw .

R

T o t a lR

Opening balanceProvisions RaisedUnused Amounts ReversedClosing Balance

233,236528,398

-233,236528,398

593,570867,030

1,460,600 0

826,8061,395,428-233,236

1,988,998

Non-current provisionsCurrent portion provisions 528 398 1,460,600 0 1 988 998

Reconcilliation of Movement of Provision - 2016

P r o v . f o r L e a v e P a y

R

H o u s i n g C o n t r .

R

L o n g S e r v i c e Aw .

R

T o t a lR

Opening balanceProvisions RaisedUnused Amounts ReversedClosing Balance

164,869233,236

-164,869233,236

593,570--

593,570

----

758,439233,236

-164,869826,806

Non-current provisionsCurrent portion provisions 233,236 593,570 - 826,806

Provision for Leave PayStaff Leave:

Employees are required to take at least 10 days during the annual leave cycle. The remaining leave days, if any, must be taken no later than 6 months after expiry of the relevant leave cycle, where-after any unused leave credits shall be forfeited.

Long Service Awards

Long Service Awards are made in recognition of the loyal, long-standing contributions and support of the College staff. The following categories of employees qualify for long-service awards:Employees employed on a permanent basis within a minimum of five years continuous unbroken service.Employees appointed on a full-time, fixed contract longer than one year and whose contract was extended on the same conditions for periods up to five years and longer.

42

The college did not default on any payment of its Creditors. No terms for payment have been renegotiated by the college. The management of the college is of the opinion that the carrying value of Creditors approximates their fair values.

9 LONG-TERM LIABILITIES

DBSA Loan:

The term of the loan is 10 years, ending 31 August 2018, the repayment amount is R71 431 per month.The Mortgage agreement is with the Development Bank of South Africa. The mortage agreement is secured by a bond registered over 85 Bird Street, Stellenbosch property as per note 6. The fair value of current borrowings equals their carrying amount, as the interest rates are considered market

Disbursements refer to stipends, tuition fees and infrastructure expenditure.

8 . U N S P E N T C O N D I T I O N A L G R A N T S A N D R E C E I P T S

2 0 1 7R

2 0 1 6R

8.1 Conditional Grants from GovernmentOther Spheres of GovernmentNon-Current Liabilities: StipendsNational Skills FundETDP Seta & DHET FundingInfrastructure Subsidy (2014/2015)Other government grants and subsidies

13,880,72013,880,720

9,409,210405,707

3,656,989(0)

408,814

14,946,85514,946,85511,457,712

1,1111,006,6551,244,5121,236,864

Total Conditional Grants and Receipts 13,880,720 14,946,855

1 0 . A C C U M U L AT E D S U R P L U S

The Accumulated Surplus consists of the following Internal Funds and Reserves: 2 0 1 7R

2 0 1 6R

Accumulated Surplus due to the results of Operations 2 5 1 , 9 3 7 , 1 7 5 2 5 5 , 8 4 1 , 9 7 6

Total Accumulated Surplus 251,937,175 255,841,976

11. OTHER TRANSFERS AND SPONSORSHIPS 2 0 1 7R

2 0 1 6R

Gifts and sponsorships receivedTransfer payment from W&R Seta

--

1 1 6 , 6 6 64 3 8 , 7 6 7

- 555,433

8.3 Movements during the year 2 0 1 7R

2 0 1 6R

Balance at the beginning of yearAdditions during the yearDisbursements

14,946,85549,605,876

(50,672,011)

21,610,83627,853,743

(34,517,724)

13,880,720 14,946,855

2 0 1 7R

2 0 1 6R

Long-term LiabilitiesCurrent Portion transferred to Current Liabilities:- DBSA Loan

Long-term Liabilities (Neither past due, nor impaired)Operating Lease LiabilitiesDBSA Loan

877 524544 191

333,333

1,276,205732,014

544,191

related. The carrying amounts of the College’s borrowings are denominated in South African Rands.

Operating Lease:

The lessee paid a refundable deposit of R333 333.32 to the college, which will be paid back with interest to the lessee on expiry of the contract. The college is however entitled to deduct from the deposit any amount owing by the lessee to the college, including any damages.

43

The National Department of Higher Education and Training (DHET) funds many of the activities of the college through means of a grant allocation. PERSAL funding is for the portion of funding that is paid via DHET’s own PERSAL payroll.

The National Department of Higher Education and Training (DHET) funds many of the activities of the college through means of a grant allocation. Programme funding is the portion of the funding which is paid to the college in cash. The college must submit a claim of actual expenditure for any Persal Savings to the department which is refunded to the college in cash.

Donated vehicles will exclusively be used for training purposes. Vehicles were donated without a manufacturer’s warranty and/or service, and/or maintenance plan. The donation was accepted on the basis that no consideration will be payable by the donee.

1 2 . G O V E R N M E N T G R A N T S A N D S U B S I D I E S

2 0 1 7R

2 0 1 6R

Other SubsidiesOperational Grants

National GrantsNational: DHET - PERSAL FundingNational: DHET - Programme FundingNational: DHET - Programme Funding (Persal Saving)National: NSF FundingTotal Government Grants and Subsidies

Government Grants and Subsidies:Conditional Grants - CapitalConditional Grants - OperationalTotal Government Grants and Subsidies

4 , 2 5 5 , 0 6 74 , 2 5 5 , 0 6 7

1 4 2 , 3 7 9 , 1 3 88 2 , 1 0 7 , 4 6 32 8 , 8 6 6 , 0 0 01 2 , 3 8 3 , 3 4 11 9 , 0 2 2 , 3 3 3

146 634 205

1 , 6 8 1 , 1 6 71 4 4 , 9 5 3 , 0 3 8

R 1 4 6 6 3 4 2 0 5

9 , 9 8 3 , 1 5 89 , 9 8 3 , 1 5 8

1 1 4 , 0 6 4 , 3 2 58 0 , 1 4 4 , 3 2 53 0 , 7 8 1 , 0 0 0

3 , 1 3 9 , 0 0 0-

124 047 483

9 , 9 8 3 , 1 5 81 1 4 , 0 6 4 , 3 2 51 2 4 0 4 7 4 8 3

12.1 Calculation of Cash Flow: 2 0 1 7R

2 0 1 6R

Government Grants and Subsidies IncomeDHET - Persal Funding (Non-cash)Opening Balance of Debtors: Non-exchange Transactions Note 4Closing Balance of Debtors: Non-exchange Transactions Note 4Total Receipts for Government Grants and Subsidies

1 4 6 , 6 3 4 , 2 0 5( 8 2 , 1 0 7 , 4 6 3 )

1 0 , 8 3 4 , 0 0 0( 1 2 , 3 8 3 , 3 4 1 )

6 1 , 9 1 1 , 2 6 6

1 2 4 , 0 4 7 , 4 8 3( 8 0 , 1 4 4 , 3 2 5 )

8 , 4 5 7 , 0 0 0( 1 0 , 8 3 4 , 0 0 0 )

3 4 , 8 6 2 , 1 7 6

12.2 PERSAL Funding 2 0 1 7R

2 0 1 6R

Balance unspent at beginning of yearCurrent year receiptsConditions met - transferred to Revenue

-8 2 , 1 0 7 , 4 6 3

( 8 2 , 1 0 7 , 4 6 3 )-

-8 0 , 1 4 4 , 3 2 5

( 8 0 , 1 4 4 , 3 2 5 )-

12.3 Programme Funding 2 0 1 7R

2 0 1 6R

Balance unspent at beginning of yearCurrent year receiptsConditions met - transferred to Revenue

( 2 8 , 8 6 6 , 0 0 0 )2 8 , 8 6 6 , 0 0 0

-

-( 3 0 , 7 8 1 , 0 0 0 )

3 0 , 7 8 1 , 0 0 0-

1 3 . P U B L I C C O N T R I B U T I O N S A N D D O N AT I O N S

2 0 1 7R

2 0 1 6R

Other DonationsTotal Public Contributions and Donations

--

7 0 9 , 7 5 67 0 9 , 7 5 6

44

1 4 . T U I T I O N A N D R E L AT E D F E E S

2 0 1 7R

2 0 1 6R

Class Fees:Students - NCVStudents - Report 191Learnership FeesOther FeesTotal Tuition and Related Fees

Tuition Fees paid directly by Students or Private Bursaries:Tuition Fees - Students (Report 191)Tuition Fees - Students (NCV)Tuition Fees - LearnershipsTuition Fees - Other

Tuition Fees funded by NSFAS Bursaries:Tuition Fees - Students (Report 191)Tuition Fees - Students (NCV)Tuition Fees - Residence

13,761,17317,488,79513,232,102

8,174,39152,656,460

9,829,0853,136,703

13,232,1023,498,081

29,695,970

7,659,71010,624,470

4,676,31022,960,490

16,749,77715,789,78121,723,31024,920,94779,183,814

1,465,5066,213,716

21,723,31015,380,33844,782,869

14,324,27510,536,061

9,540,60934,400,945

Total Tuition and Related Fees 52,656,460 79,183,814


2 0 1 6R

Tuition and Related Fees IncomeOpening Balance of Debtors: Tuition FeesClosing Balance of Debtors: Tuition FeesOpening Balance of Class Fees in AdvanceClosing Balance of Class Fees in AdvanceAmounts written-off as uncollectable

52,656,46015,873,807

(22,175,458)(389,480)

924,776(4,751,516)

79,183,81410,319,020

(15,873,807)(4,602,766)

389,480(1,358,200)

Total Receipts for Tuition and Related Fees 42,138,589 68,057,541

1 5 . R E N TA L O F F A C I L I T I E S A N D E Q U I P M E N T

2 0 1 7R

2 0 1 6R

Rental Revenue from AmenitiesRental Revenue from Buildings

1,073,8514,727,347

737,6192,329,246

Total Rental of Facilities and Equipment 5,801,198 3,066,865

1 6 . I N T E R E S T E A R N E D

2 0 1 7R

2 0 1 6R

External Investments:Bank AccountInvestments

116,686282,780399,466

160,5861,627,4221,788,008

Total Interest Earned 399,466 1,788,008

Rental revenue earned on Facilities and Equipment is in respect of Non-financial Assets rented out.Letting of halls, classrooms, to mainly other government institutions, and vacant residences to mainly University of Stellenbosch students. Boland College students get first priority to accommodation.

45

16.1 Calculation of Interest Cash Flow: 2 0 1 7R

2 0 1 6R

External Interest Income 399,466 1,788,008

Total Receipts for Interest Received 399,466 1,788,008

1 7 . S A L E O F G O O D S A N D R E N D E R I N G O F S E R V I C E S

2 0 1 7R

2 0 1 6R

Sale Of GoodsRendering Of Services

45,789138,888

84,941110,495

Total Royalties Received 184,677 195,436

1 8 . O T H E R R E V E N U E

2 0 1 7R

2 0 1 6R

Bad Debts RecoveredInsurance ClaimsTender DocumentsSkills Levy GrantSundry Income

151,31015,30122,678

671,817510,657

123,225684,986

30,300440,123654,099

Total Other Revenue 1,371,762 1,932,733

1 9 . E M P L O Y E E R E L AT E D C O S T S

Employee Related Costs: Council 2 0 1 7R

2 0 1 6R

Employee Related Costs - Salaries and WagesEmployee Related Costs - Salaries and WagesLong Service BonusesTravel, Motor Car, Accommodation, Subsistence and Other AllowancesHousing Benefits and AllowancesOther Payroll RelatedOther Employee Related CostsEmployee Related Costs - Contributions for UIF, Pensions and Medical AidsEmployee Related Costs - Contributions for UIF, Pensions and Medical AidsWCALeave AccrualCollege CouncilPerformance and Other Bonuses

49,304,70447,575,112

97,958185,483867,030247,713331,408147,673

-147,673295,163147,005

2,085,105

51,522,10149,880,393

29,338184,699593,570237,811596,291

71,486-

71,48668,366

163,8871,337,921

51,979,649 53,163,761


2 0 1 6R

Income from Other RevenueIncome from Rental of Facilities and EquipmentOther Transfers and Sponsorships

Note 18Note 15Note 16

1,371,7625,801,198

-

1,932,7333,066,865

555,433

Total Other Revenue 7,172,960 5,555,030

2 0 1 7R

2 0 1 6R

Financial Assets at Amortised CostHeld-to-Maturity Investments

299,99199,476

399,466

835,068 952,940

1,788,008

Total Receipts for Interest Received 399,466 1,788,008

Interest Earned on Financial Assets, analysed by category of asset, is as follows:

46

DHET Management Fee Cost: 2 0 1 7R

2 0 1 6R

Employee Related Costs - Salaries and WagesEmployee Related Costs - Salaries and WagesEmployee Related Costs - Contributions for UIF, pensions and medical aidsHousing Benefits and AllowancesTravel, motor car, accommodation, subsistence and other allowancesPerformance and Other Bonuses

82,107,46361,209,75412,094,824

2,582,81623,537

6,196,53382,107,463

80,144,32562,122,47210,619,129

2,349,000-

5,053,72480,144,325

Total Employee Related Costs 134,087,113 133,308,086


2 0 1 6R

Employee Related Costs ExpenditureManagement Fee Cost (Non-cash)Leave AccrualHousing Contribution payable

134,087,113(82,107,463)

(295,163)(867,030)

133,308,086(80,144,325)

(68,366)(593,570)

Total Payments for Employee Related Costs 50,817,457 52,501,825

19.2 Expenses paid via Persal from College programme funding: 2 0 1 7R

2 0 1 6R

Lecturers engaged in Report 191 and NCV coursesSupport staff engaged in Report 191 and NCV coursesManagement remunerationLecturers engaged in Report 191 and NCV coursesSupport staff engaged in Report 191 and NCV courses

Expenses paid via College payroll:Lecturers engaged in Report 191 and NCV coursesSupport staff engaged in Report 191 and NCV coursesManagement remunerationLecturers not engaged in Report 191 and NCV coursesSupport staff not engaged in Report 191 and NCV courses

Total employee cost and DHET management fee:Total fundedLecturers engaged in Report 191 and NCV coursesSupport staff engaged in Report 191 and NCV coursesManagement remuneration

Total non-funded and otherLecturers not engaged in Report 191 and NCV coursesSupport staff not engaged in Report 191 and NCV courses

53,956,159.4424,513,189.65

3,638,114.33

82,107,463

13,571,613.1532,379,235.99

2,705,902.801,561,296.79

50,218,049

67,527,772.5956,892,425.64

3,638,114.33128,058,313

2,705,902.801,561,296.79

4,267,200

52,863,96221,509,921

3,745,9811,045,278

979,18480,144,325

16,055,23025,467,042

1,835,4898,476,288

51,834,049

68,919,191.2046,976,962.60

3,745,980.60119,642,134

2,880,767.009,455,472.00

12,336,239

In terms of the CET Act, employees that are employed by DHET and have a dual accountability towards the council and DHET respectively. The College has a formal process of approving new posts, based on operational need and availability of funds, before recruitment. Six (6) new position (Support Staff), was established in 2017 financial year and would be funded through DHET Persal funding. Positions were advertised in 2017, but not filled.

47

20. DEPRECIATION AND AMORTISATION 2 0 1 7R

2 0 1 6R

Depreciation: Property, Plant and Equipment 9,137,890 8,755,124

Total Depreciation and Amortisation 9,137,890 8,755,124

22. IMPAIRMENT LOSSES

22.1 Impairment Losses on Financial Assets 2 0 1 7R

2 0 1 6R

Impairment Losses Recognised:Receivables from Exchange TransactionsBad debt written off/back

Impairment Losses Reversed:Receivables from Exchange Transactions

5,989,1795,644,250

344,929

(258,560)(258,560)

1,750,5111,443,659

306,852

(264,378)(264,378)

5,730,619 1,486,133

25. REPAIRS AND MAINTENANCE 2 0 1 7R

2 0 1 6R

Land and BuildingsComputer Hardware/EquipmentOther AssetsFurniture And FittingsPlant & EquipmentMotor Vehicles - General

5,160,40441,553

2,980157,247

99,35727,891

6,295,478116,754

1,996289,537156,391

12,003

Total Repairs and Maintenance 5,489,433 6,872,159

26. FINANCE COSTS 2 0 1 7R

2 0 1 6R

Loans and Payables at amortised costTotal Interest Expense

Less: Amounts included in the Cost of qualifying AssetsTotal Interest Paid on External Borrowings

125,160125,160

-125,160

215,829215,829

-215,829

26.1 Calculation of Cash Flow:

Finance Cost Expenditure 125,160 215,829

Total Payments for Finance Costs 125,160 215,829

23. MARKETING EXPENSES 2 0 1 7R

2 0 1 6R

AdvertisingBranding CostsPrintingStudent Related Marketing

111,2558,632

406,902629,837

400,067106,971805,719838,780

Total Marketing Expenses 1,156,625 2,151,537

21. EXTERNAL AUDIT FEES 2 0 1 7R

2 0 1 6R

External Audit Fees 1,451,460 444,296

24. PRINTING AND STATIONERY 2 0 1 7R

2 0 1 6R

Printing and Stationery 3,091,151 2,315,868

48

28. PROGRAMME CONSUMABLES 2 0 1 7R

2 0 1 6R

Programme Consumables 6,591,119 7,371,281

Total Programme Consumables 6,591,119 7,371,281

32. SECURITY 2 0 1 7R

2 0 1 6R

Security Services 5,150,553 4,709,167

Total Security Costs 5,150,553 4,709,167

31. PROFESSIONAL SERVICES 2 0 1 7R

2 0 1 6R

Consulting ServicesLegal Services

211,367119,218

312,672353,120

Total Professional Services 330,585 665,791

30. STUDENTS RESIDENTS MEALS 2 0 1 7R

2 0 1 6R

Students meals 3,549,760 6,404,207

Total Students Residents Meals 3,549,760 6,404,207

29. MUNICIPAL SERVICES 2 0 1 7R

2 0 1 6R

ElectricityRates and TaxesSewerage And SanitationWater

4,672,4992,642,8921,663,7372,841,729

5,105,4082,174,4872,036,3521,917,201

Total Municipal Services 11,820,857 11,233,448

33. TRAVEL AND ACCOMMODATION 2 0 1 7R

2 0 1 6R

Accommodation - DomesticFuel and PetrolStudent Related Travel CostsTravel Cost - Domestic

99,74066,483

399,708261,371

102,288168,643433,180221,231

Total Travel and Accommodation 827,301 925,342

34. TELEPHONE, POSTAGE, INTERNET, NETWORK AND COMMUNICATION COSTS 2 0 1 7R

2 0 1 6R

Telephone costsPostage and courierData and network costsSoftware licensing

1,539,406294,348

1,786,0391,977,183

1,527,382487,091

1,782,5423,159,577

Total Telephone, Postage, Internet, Network and Communication Costs 5,596,975 6,956,592

27. BOOKS AND LEARNING MATERIALS 2 0 1 7R

2 0 1 6R

BooksTraining Materials

4,470,128112,664

7,545,10273,324

Total Books and Learning Materials 4,582,793 7,618,426

49

3 5 . T R A I N I N G A N D S TA F F D E V E L O P M E N T

2 0 1 7R

2 0 1 6R

Conferences and WorkshopsStaff AwardsStaff Development

247,815-

626,305

332,46516,410

1,250,245

Total Training and Staff Development 874,120 1,599,121

3 6 . G R A N T S A N D S U B S I D I E S PA I D

2 0 1 7R

2 0 1 6R

Operational GrantsPrivate/Donor BursariesTransportBoland College Bursary

(1,400)2,757,085

103,306

63,2828,376,8751,160,053

Capital Grants - -

Total Grants and Subsidies 2,858,990 9,600,210

3 7 . G E N E R A L E X P E N S E S

Included in General Expenses are the following:2 0 1 7

R2 0 1 6

R

Bank ChargesCleaning MaterialCateringHealth and SafetyHire Of Facilities & EquipmentInsuranceMembership And Subscription FeesStudent CardsStudent Development and AwarenessVehicle Expenses

523 368793,930123,468176,581426,764741,511177,290

80,312311,354255,001

537,5101,021,639

255,347407,020828,681702,428179,731101,184374,119303,456

Total General Expenses 3,609,578 4,711,115

37.1 Calculation of Other Payments Cash Flow:

Expenditure for General ExpensesExpenditure for Proffesional ServicesExpenditure for Grants and Subsidies Paid

Note 37Note 31Note 36

3,609,578330,585

2,858,990

4,711,115665,791

9,600,210

Total for Other Payments 6,799,154 14,977,116

50

3 8 . G A I N S / L O S S E S O N D I S P O S A L O F C A P I TA L A S S E T S

2 0 1 7R

2 0 1 6R

Assets Disposed at Carrying Value: (17,514) (7,059)

Losses on Disposal of Assets (17,514) (7,059)

Total Gains/Losses on Disposal of Capital Assets (17,514) (7,059)

37.2 Calculation of Suppliers Paid Cash Flow:2 0 1 7

R2 0 1 6

R

External Audit FeesMarketing ExpensesPrinting and StationeryRepairs and MaintenanceBooks and Learning MaterialsOperating Lease ExpenseProgramme ConsumablesMunicipal ServicesStudents Residents MealsProfessional ServicesSecurityTravel and AccommodationTelephone and InternetTraining and Staff DevelopmentOther Non-Cash MovementOpening Balance of Payables: Exchange TransactionsClosing Balance of Payables: Exchange TransactionsOpening Balance of Payables: Housing Contribution (Employee Cost)Closing Balance of Payables: Housing Contribution (Employee Cost)Opening Balance of Payables: Staff LeaveClosing Balance of Payables: Staff LeaveOpening Balance of Payables: Payments in AdvanceClosing Balance of Payables: Payments in AdvanceOpening Balance of InventoriesClosing Balance of Inventories

Note 21Note 23Note 24Note 25Note 27

NoteNote 28Note 29Note 30Note 31Note 32Note 33Note 34Note 35

Note N/ANote 7Note 7Note 7Note 7Note 7Note 7Note 7Note 7Note 2Note 2

1,451,4601,156,6253,091,1515,489,4334,582,7934,872,9726,591,119

11,820,8573,549,760

330,5855,150,553

827,3015,596,975

874,12014,344

12,687,636(11,512,323)

1,460,600(593,570)

528,398(233,236)

924,776(389 480)(203,847)

699,982

444,2962,151,5372,315,8686,872,1597,618,4263,908,1937,371,281

11,233,4486,404,207

665,7914,709,167

925,3426,956,5921,599,121(358,939)

12,268,112(12,687,636)

593,570-

233,236(164,869)

389,480(4,602,766)(1,658,872)

203,847

Total for Suppliers Paid 58,768,986 57,390,588

51

3 9 . C O R R E C T I O N O F E R R O R

Corrections were made during the previous financial years. Details of the corrections are described below:

2 0 1 7R

2 0 1 6R

39.1 Reclassification of Accumulated SurplusThe prior year figures of Accumulated Surplus has been restated to correctly disclose the monies held by the college in terms of the disclosure notes indicated below.

The effect of the changes are as follows:Accumulated

Surplus

Balances published as at 31 December 2015Correction of Error:Carrying Value Adjustment of newly verified asset registerCost Price of Computer Equipment CorrectionsAccumulated Depreciation of Computer Equipment CorrectionsCost Price of Furniture & Fittings CorrectionsAccumulated Depreciation of Furniture & Fittings CorrectionsAcc. Depreciation Adjustment for Review of EUL of AssetsRounding Differences

2,966,853(4,859,336)

4,859,336(9,888,379)

9,089,53411,506,162

-

251,947,262

13,674,169

Restated Balances as at 31 December 2015Transactions incurred for the Year 2016Correction of Error:Increase in Depreciation due to PPE CorrectionsAdjustment for Other Expenditure as per Revised Capitalisation MethodologyAdjustment for Programme Consumables as per Revised Capitalisation MethodologyAdjustment for Repairs And Maintenance as per Revised Capitalisation MethodologyAdjustment for Security as per Revised Capitalisation MethodologyAdjustment for Students Residents Meals as per Revised Capitalisation MethodologyAdjustment for Telephone And Internet as per Revised Capitalisation MethodologyAdjustment for Printing And Stationary as per Revised Capitalisation MethodologyUnconditional Grants not previously recognised as RevenueCorrection of Municipal Service capture in incorrect periodRounding Differences

(589,478)(5,953)

(151,129)(91,329)(36,444)(28,693)(10,016)

(1,561)-

(230,028)28,905,837

265,621,431(8,629,965)

27,761,206

Restated Balances as at 31 December 2016 284,752,672

52

39.2 Reclassification of ExpenditureThe prior year figures of Expenditure Classes have been restated to correctly classify the nature of Expenditure of the college.

The effect of the Correction of Error is as follows:Prior Year

2016Expenditure

Current Year2016

Expenditure

AmountRestated

By

Employee Related CostsCollection CostsDepreciation and AmortisationExternal Audit FeesImpairment LossesMarketing ExpensesPrinting and StationeryRepairs and MaintenanceFinance CostsBooks and Learning MaterialsOperating Lease ExpenseProgramme ConsumablesMunicipal ServicesStudents Residents MealsProfessional ServicesSecurityTravel and AccommodationTelephone and InternetTraining and Staff DevelopmentContracted ServicesGrants and Subsidies PaidGeneral ExpensesLosses on Other OperationsLoss on Disposal of Property, Plant and Equipment

133,308,086-

8,165,641444,296

1,486,1332,151,5372,314,3076,775,977

215,8297,618,4263,908,1937,220,152

11,003,4206,375,514

665,7914,672,723

925,3426,946,5761,599,121

412,8219,600,2104,292,341

-7,059

133,308,086-

8 755 124444,296

1,486,1332,151,5372,315,8686,872,159

215,8297,618,4263,908,1937,371,281

11,233,4486,404,207

665,7914,709,167

925,3426,956,5921,599,121

-9,600,2104,711,115

-7,059

--

589,483---

1,56196,182

---

151,129230,028

28,693-

36,444-

10,016-

(412,821)-

418,774--

220,109,493 221,258,982 1,149,489

Prior year amounts of items in Expenditure included in the Statement of Financial Performance have been restated as indicated below:

MunicipalServices

Printing & Stationery

Depreciation&

Amortisation

Balance previously reportedAdjustment for revised Depreciation within new Asset RegisterAdjustment to Depreciation due to review of EULReclassification of Expenditure in accordance with nature of transactionCorrection of Municipal Service capture in incorrect period

11,003,420

230,028

2,314,307

1,561

8,165,641961,046

(371,568)

Restated Balance now reported 11,233,448 2,315,868 8,313,485

Programme Consumables

Student Resident

Meals

Repairs & Maintenance

Balance previously reportedReclassification of Expenditure in accordance with nature of transaction

7,220,152

151,129

6,375,514

28,693

6,775,977

91,329

Restated Balance now reported 7,371,281 6,404,207 6,920,772

53

3 9 . C O R R E C T I O N O F E R R O R ( C O N T I N U E D )

2 0 1 7R

2 0 1 6R

Security Telephone& Internet

Balance previously reportedReclassification of Expenditure in accordance with nature of transaction

4,672,72336,444

6,946,57610,016

Restated Balance now reported 4,709,167 6,956,592

ContractedServices

GeneralExpenditure

Reclassification of Expenditure in accordance with nature of transactionReclassification of Contracted Services to General Expenditure

412,821

(412,821)

4,292,3415,953

412,821

4,711,115

39.3 Reclassification of Statement of Financial PositionThe prior year figures of Classes in the Statement of Financial Position have been restated to correctly classify the nature of Assets, Liabilities and Net Assets of the college.

The effect of the Correction of Error is as follows:Prior Year

2016Balance

Current Year2016

Balance

AmountRestated

By

Current AssetsInventoriesReceivables from Exchange TransactionsReceivables from Non-exchange TransactionsCash and Cash Equivalents

203,84714,430,14810,834,000

9,464,059

203,84714,430,14810,834,000

9,464,059

----

Non-Current AssetsProperty, Plant and EquipmentNon-current Investments

237,065,910-

249,820,619-

12,754,709-

Current LiabilitiesProvisionsPayables from Exchange TransactionsPayables from Non-exchange TransactionsUnspent Conditional Grants and Receipts

-(12,457,608)

-(14,946,855)

-(12,687,636)

-(14,946,855)

----

Non-Current LiabilitiesLong-term Liabilities (1,276,205) (544,191) -

Net AssetsAccumulated Surplus/(Deficit) (243,317,295) (255,841,976) (12,754,709)

- 732,014 -

54

Opening balances and prior year amounts of items in the Statement of Financial Position have been restated as indicated below:

Property, Plantand Equipment

Balances previously published per AFS as at 31Carrying Value Adjustment of newly verified asset registerCost Price of Computer Equipment CorrectionsAccumulated Depreciation of Computer Equipment CorrectionsCost Price of Furniture & Fittings CorrectionsAccumulated Depreciation of Furniture & Fittings CorrectionsAcc. Depreciation Adjustment for Review of EUL of Assets

233,345,6052,966,853

(4,859,336)4,859,336

(9,888,379)9,089,534

11,506,162

Balances now published per AFS as at 31 December 2015 247,019,774

Movement as per 2015/16 AFSAdjustment for Revised Depreciation within new Asset RegisterAdjustment for Other Expenditure as per Revised Capitalisation MethodologyAdjustment for Programme Consumables as per Revised Capitalisation MethodologyAdjustment for Repairs And Maintenance as per Revised Capitalisation MethodologyAdjustment for Security as per Revised Capitalisation MethodologyAdjustment for Students Residents Meals as per Revised Capitalisation MethodologyAdjustment for Telephone and Internet as per Revised Capitalisation MethodologyOther Corrections

3,720,305(589,478)

(5,953)(151,129)

(91,329)(36,444)(28,693)(10,016)

(6,419)

Balances now published per AFS as at 31 December 2016 249,820,619

Property, Plant and Equipment:During the 2016/17 Financial Year the College implemented an Electronic Asset Verification system, including various controls to improve the Asset Management process, and reconcile the Asset Verification data to the Financial System.

The Opening Balance of Property, Plant and Equipment has been restated to correctly disclosed the accurate asset count and values, as per the revised Asset Register.

The Accumulated Depreciation and Depreciation Expense related to assets has also been corrected to accurately disclose the value of assets still in use, in accordance with a Condition Assessment of all assets.

Various operational expenditure has been adjusted, as indicated above, to accurately disclose the nature of the transactions.

55

4 0 . C A S H G E N E R AT E D B Y O P E R AT I O N S

2 0 1 7R

2 0 1 6R

Surplus for the YearAdjustment for:Revenue Received-in-Kind: Persal GrantExpenditure incurred from Persal GrantDepreciation and AmortisationLosses on Disposal of Property, Plant and EquipmentOther Movement on Property, Plant and EquipmentImpairment LossesBad Debts Written-off

(3,904,801)

(82,107,463)82,107,463

9,137,89017,514

-5,385,690

(4,751,516)

(9,779,454)

(80,144,325)80,144,325

8,755,1247,059

-1,179,281

(1,358,200)

Operating surplus before working capital changesDecrease/(Increase) in InventoriesDecrease/(Increase) in Receivables from Exchange TransactionsDecrease/(Increase) in Receivables from Non-exchange TransactionsIncrease/(Decrease) in Payables from Exchange TransactionsIncrease/(Decrease) in Conditional Grants and Receipts

5,884,777(496,136)

(6,301,651)(1,549,341)(1,175,314)(1,066,135)

(1,196,190)1,455,025

(5,554,787)(2,377,000)

419,524(6,663,982)

Cash generated by/(utilised in) Operations (4,703,799) (13,917,410)

4 2 . C O M M I T M E N T S F O R E X P E N D I T U R E

42.1 Capital CommitmentsThe college had no capital commitments at year-end.

2 0 1 7R

2 0 1 6R

Commitments in respect of Capital Expenditure:Approved and Contracted for:Land and BuildingsFurniture & Fittings

-

--

1,095,775

1,081,16714,608

Total Capital Commitments - 1,095,775

This expenditure will be financed from:Government GrantsOwn Resources

--

1,081,16714,608

No capital commitments for 2017 - 1,095,775

42.2 Commitments in respect of operational ExpenditureApproved and contracted for:TextbooksMaintenanceMarketingOther

1,606,30835,285

203,31939,756

4,51784,371

Total operational commitments 1,884,668 88,888

The operational commitments will be financed from:Own Resources 1,884,668 88,888

1,884,668 88,888

4 1 . N O N - C A S H I N V E S T I N G A N D F I N A N C I N G T R A N S A C T I O N S

The college did not enter into any Non-cash Investing and Financing Transactions during the 2017 Financial year.

56

42.3 Operating Lease CommitmentsAt the reporting date the College has outstanding commitments under operating leases which fall due as follows:

2 0 1 7R

2 0 1 6R

LesseeThe major category of asset leased is Photocopiers.At the reporting date the College had outstanding commitments under non-cancellable operating leases, which fall due as follows:Up to 1 year1 to 5 years

1,786,0891,087,918

2,149,5771,878,954

2,874,006 4,028,530

Operating Leases consists of the following:Leases are negotiated for an average term of 3 years and rentals are fixed (0% annual increase) for an average of 3 years. Rentals are payable in advance with. No contingent rent is payable. Ownership of the devices shall at all times, during and after termination of agreement, remain vested in Nashua.

The major category of asset leased is Laptops.At the reporting date the College had outstandingUp to 1 year1 to 5 years

928,327773,606

928,3271,701,933

1,701,932 2,630,259

Laptops were negotiated for an average term of 4 years. Rentals are fixed (0% annual increase) over the time of the contract. Rentals are payable in advance and no contingent rent is payable. Ownership of the devices shall at all times, during and after termination of agreement remain vested in Dell Financial Services.

The major category of asset leased is Motor Vehicles.At the reporting date the College had outstanding commitments undernon-cancellable operating leases, which fall due as follows:Up to 1 year1 to 5 years

962,505766,815

1,421,8091,573,684

1,729,320 2,995,493

Operating Leases consists of the following:Vehicle leases are negotiated for an average term of 3 year/90 000 km full maintenance lease, and rentals are linked to change in interest rates. No contingent rent is payable. Ownership of vehicles comprising the fleet shall at all times, during and after termination of agreement, remain vested in Absa Vehicle Management Services.

Total Operating Lease CommitmentsAt the reporting date the College had outstanding commitments under non-cancellable operating leases, which fall due as follows:Up to 1 year1 to 5 years

3,676,9212,628,338

4,499,7125,154,571

6,305,259 9,654,283

57

4 2 . C O M M I T M E N T S F O R E X P E N D I T U R E ( C O N T I N U E D )

2 0 1 7R

2 0 1 6R

LessorAt the reporting date the College had entered into a lease arrangement with the University of Stellenbosch for the lease of Rozenhof Residence for a period of 3 years, with a fixed rental increase of 6%.Up to 1 year1 to 5 years

2,120,0002,247,200

--

4,367,200 -

Total Operating Lease CommitmentsAt the reporting date the College had outstanding commitments under non-cancellable operating leases, which fall due as follows:Up to 1 year1 to 5 years

2,120,0002,247,200

4,367,200

Commitments:Service Level Agreements 2017

N a m e S e r v i c e S t a r t D a t e

A m o u n t a w a r d e d

a s p e r t h e C o n t r a c t

P a y m e n t s u p u n t i l

3 1 D e c 2 0 1 7

C o m m i t m e n t a s a t

3 1 D e c 2 0 1 7

CaledonTuindienste

Garden Maintenance Service inCaledon

01/04/2017to 31/03/2018

R 215,112.00 R 161,658.00 R 53,454.00

CrouchingLeopard Technologies

Remote support of the Caltch Pastel Link

01/01/2018 to 31/12/2018

R 72,600.00 R - R 72,600.00

Green Clean Bin Maintenance of Grease Traps

01/01/2018 to 31/12/2020

R 1,126,926.00 R - R 1,126,926.00

Moore Stephens Internal Audit Function 01/08/2017 to 30/06/2018

R 215,760.00 R 206,272.99 R 9,487.01

Nu-line Elevator Maintenance (Str)

Maintenance & services of elevators

01/07/2017 to 31/06/2020

R 63,928.51 R 8,467.38 R 55,461.13

Nu-line Elevator Maintenance Stb)


01/07/2017 to 31/06/2020

R 63,928.38 R 8,467.38 R 55,461.00

NUS Consulting Energy management Services (Electrical & Water)

01/09/2017 to 31/08/2018

R 84 898.00 R 25,650.00 R 59,248.00

Servest Hygiene Hygiene and Pest Control Services

01/11/2017 to 31/10/2020

R 2,186,705.40 R 9,282.06 R 2,177,423.34

Servest Landscaping

Landscaping and garden maintenance serivces Stellenbosch, Strand, Worcester

01/04/2016 to 31/03/2019

R 5,377,739.28 R 3,272,750.72 R 2,104,988.56

R 5,715,049.04

58

Commitments:Service Level Agreements 2016

N a m e S e r v i c e S t a r t D a t e

A m o u n t a w a r d e d

a s p e r t h e C o n t r a c t

P a y m e n t s u p u n t i l

3 1 D e c 2 0 1 6

C o m m i t m e n t a s a t

3 1 D e c 2 0 1 6

Servest Landscaping

Garden Maintenance Service inCaledon

01/04/2016 to 31/03/2019

R 5,377,739.28 R 1,499,765.90 R 3,877,973.30

Servest Security Security services 01/01/2015 to 31/12/2017

R 17,694,252.00 R 8,208,158.81 R 9,486,093.19

Nu-line Elevator Maintenance (Str)


01/06/2014 to 31/05/2017

R 50,728.30 R 39,940.30 R 10,787.96

Nu-line Elevator Maintenance Stb)


01/06/2014 to 31/05/2017

R 50,728.30 R 39,940.30 R 10,787.96

R 13,385,642.41

4 3 . F I N A N C I A L I N S T R U M E N T S

43.1 Classification

FINANCIAL ASSETS:In accordance with GRAP 104.13 the Financial Assets of the college are classified as follows:

F i n a n c i a l A s s e t s C l a s s i f i c a t i o n2 0 1 7

R2 0 1 6

R

Non-current InvestmentsOther Investments Fair value - -

Receivables from Exchange TransactionsStaff Debtors ControlProvincial GovernmentPrepaid ExpenditureStudent DebtorsNational GovernmentSundry DebtorsMunicipal DepositsGeneral Accruals

Amortised costAmortised costAmortised costAmortised costAmortised costAmortised costAmortised costAmortised cost

312,2652,474,095

260,83714,349,536

1,474,8131,156,818

69,260-

52,1328,822,416

325,413914,750

3,737,257431,010114,360

32,809

Receivables from Non-exchange TransactionsNational Government Amortised cost 12,383,341 10,834,000

Cash and Cash EquivalentsCall DepositsBank BalancesCash Floats and Advances

Fair valueFair valueFair value

845,8592,405,394

1,100

581,3798,881,580

1,100

59

4 3 . F I N A N C I A L I N S T R U M E N T S ( C O N T I N U E D )

F i n a n c i a l A s s e t s C l a s s i f i c a t i o n2 0 1 7

R2 0 1 6

R

SUMMARY OF FINANCIAL ASSETS:Financial Assets at Amortised CostReceivables from Exchange TransactionsReceivables from Exchange TransactionsReceivables from Exchange TransactionsReceivables from Non-exchange TransactionsCash and Cash EquivalentsCash and Cash Equivalents

Student Debtors ControlOther DebtorsOther Exchange ServicesNational GovernmentCall DepositsBank Balances

14,349,5365,417,991

330,09712,383,341

845,8592,405,394

914,75013,042,816

472,58310,834,000

581,3798,881,580

35,732,219 34,727,107

FINANCIAL ASSETS AT FAIR VALUE:Cash and Cash Equivalents Cash Floats and Advances 1,100 1,100

1,100 1,100

Total Financial Assets 35,733,319 34,728,207

FINANCIAL LIABILITIES:In accordance with GRAP 104.13 the Financial Liabilities of the college are classified as follows:

F i n a n c i a l L i a b i l i t i e s C l a s s i f i c a t i o n2 0 1 7

R2 0 1 6

R

Long-term LiabilitiesCurrent Portion - DBSALong Term Portion - DBSALong Term Portion - Operating Lease

Amortised costAmortised costAmortised cost

544,191-

333,333

732,014544,191

Payables from Exchange TransactionsTrade CreditorsIncome Received in AdvanceStaff Leave AccruedOther CreditorsNet Pay ControlBursary FundHousing ContributionNSFAS Creditors (students)


3,935,520.70924,776528,398212,492521,238

(0)1,460,6003,929,298

6,000,834389,480233,236

1,891,030466,268

1,684,712593,570

1,428,506

Payables from Non-exchange TransactionsDHET CreditorNSFAS CreditorsInfrastructure Subsidy (2013/2014)Infrastructure Subsidy (2015/2016)Payments received in Advance -ETDP Seta RPL CentreCommunity Learning centreNSF CreditorStipends


3,656,989----

408,814405,707

9,409,210

--

1,006,6551,244,512

-1,236,864

1,11111,457,712

SUMMARY OF FINANCIAL LIABILITIESFinancial Liabilities at Amortised Cost:Current Portion - DBSALong Term Portion - DBSALong Term Portion - Operating LeasePayables from Exchange TransactionsPayables from Non-exchange Transactions

Annuity LoansAnnuity Loans

Trade CreditorsTrade Creditors

544,191

333,33311,512,32313,880,720

732,014544,191

12,687,63614,946,855

26,270,567 28,910,696

Total Financial Liabilities 26,270,567 28,910,696

60

2 0 1 7R

2 0 1 6R

43.2 Capital Risk ManagementThe college manages its capital to ensure that the college will be able to continue as a going concern while delivering sustainable services to consumers through the optimisation of the debt and equity balance. The college’s overall strategy remains unchanged from 2016.

The capital structure of the college consists of debt, which includes Cash and Cash Equivalents and Equity, comprising Accumulated Surplus as disclosed in Note 10 and the Statement of Changes in Net Assets.

Gearing RatioThe gearing ratio at the year-end was as follows:DebtCash and Cash Equivalents

877,524(3,252,354)

1,276,205(9,464,059)

Net Debt (2,374,830) (8,187,854)

Equity 251,937,175 255,841,976

Net debt to equity ratio -0.94% -3.20%

Debt is defined as Long-term Liabilities, together with its Short-term Portion. Equity includes all Funds and Reserves of the college, disclosed as Net Assets in the Statement of Financial Performance and Net Debt as described above.

43.3 Financial Risk Management ObjectivesThe Chief Financial Officer has overall responsibility for the establishment and oversight of the college’s risk management framework. The college’s risk management policies are established to identify and analyse the risks faced by the college, to set appropriate risk limits and controls and to monitor risks and adherence to limits.

Due to the largely non-trading nature of activities and the way in which they are financed, colleges are not exposed to the degree of financial risk faced by business entities. Generally, Financial Assets and Liabilities are generated by day-to-day operational activities and are not held to manage the risks facing the college in undertaking its activities.

The Directorate: Financial Services monitors and manages the financial risks relating to the operations through internal policies and procedures. These risks include interest rate risk, credit risk and liquidity risk. Risk management policies and systems are reviewed regularly to reflect changes to market conditions and the college’s activities, and compliance with policies and procedures is reviewed by the internal auditors on a continuous basis, and annually by external auditors. The college does not enter into or trade financialinstruments for speculative purposes.

The College Council manages the financial risks relating to the operations through internal policies and procedures. These risks include interest rate risk, credit risk and liquidity risk. Compliance with policies and procedures is reviewed by the internal auditors on a continuous basis, and annually by external auditors. The college does not enter into or trade financial instruments for speculative purposes.

The Corporate Treasury function reports quarterly to the college’s risk management committee, an independent body that monitors risks and policies implemented to mitigate risk exposures. Internal audit, responsible for initiating a control framework and monitoring and responding to potential risk, reports periodically to the college’s audit committee, an independent body that monitors the effectiveness of the internal audit function.

Further quantitative disclosures are included throughout these Annual Financial Statements.

43.4 Significant RisksIt is the policy of the college to disclose information that enables the user of its Annual Financial Statements to evaluate the nature and extent of risks arising from Financial Instruments to which the college is exposed on the reporting date.

The college has exposure to the following risks from its operations in Financial Instruments:- Credit Risk- Liquidity Risk- Market Risk

Risks and exposures are disclosed as follows:

Market RiskMarket Risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the college’s income or the value of its holdings in Financia Instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return.

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Credit RiskCredit Risk is the risk of financial loss to the college if a customer or counterparty to a Financial Instrument fails to meet its contractual obligations and arises principally from the college’s receivables from customers and investment securities.

Liquidity RiskLiquidity Risk is the risk that the college will encounter difficulty in meeting the obligations associated with its Financial Liabilities that are settled by delivering cash or another financial asset. The college’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the college’s reputation.

Liquidity Risk is managed by ensuring that all assets are reinvested at maturity at competitive interest rates in relation to cashflow requirements. Liabilities are managed by ensuring that all contractual payments are met on a timeous basis and, if required, additional new arrangements are established at competitive rates to ensure that cash flow requirements are met.

A maturity analysis for Financial Liabilities (where applicable) that shows the remaining undiscounted contractual maturities is disclosed in Note 43.8 to the Annual Financial Statements.

43.5 Market RiskThe college’s activities expose it primarily to the financial risks of changes in interest rates (see Note 43.7 below). No formal policy exists to hedge volatilities in the interest rate market.

There has been no change to the college’s exposure to market risks or the manner in which it manages and measures the risk.

43.5.1 Interest Rate Risk ManagementInterest Rate Risk is defined as the risk that the fair value or future cashflows associated with a financial instrument will fluctuate in amount as a result of market interest changes.

Potential concentrations of interest rate risk consist mainly of variable rate deposit investments, long-term receivables, tuition fee debtors, other debtors, bank and cash balances.

The college limits its counterparty exposures from its money market investment operations by only dealing with Absa Bank and Investec. No investments with a tenure exceeding twelve months are made.

Tuition Fee Debtors comprise of a large number of students, dispersed across different industries and geographical areas. Consumer debtors are presented net of a provision for impairment.

In the case of debtors whose accounts become in arrears, very little actions can be instituted against these debtors since “restriction of services” is inappropriate given government’s objectives for TVET colleges. However, as a last resort, accounts are “handed over for collection” as applicable in terms of Council’s Financial Policy.

The college is not exposed to credit interest rate risk as the college has no borrowings.

The college’s exposures to interest rates on Financial Assets and Financial Liabilities are detailed in the Credit Risk Management section of this note.

Interest Rate Sensitivity AnalysisThe sensitivity analysis has been determined based on the exposure to interest rates at the Statement of Finan-cial Position date. The analysis is prepared by averaging the amount of the investment at the beginning of the financial year and the amount of the investment at the end of the financial year. A 100 basis point increase or decrease was used, which represents management’s assessment of the reasonably possible change in interest rates. The short and long-term financial instruments at year-end with variable interest rates are set out in Note 43.8 below:

43.6 Credit Risk ManagementCredit Risk refers to the risk that a counterparty will default on its contractual obligations resulting infinancial loss to the college. The college has a sound debt management policy and obtains sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults. The college uses its own trading records to assess its major customers. The college’s exposure of its counterparties are monitored regularly.

Potential concentrations of credit rate risk consist mainly of variable rate deposit investments, tuition fee debtors, other debtors, bank and cash balances.

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Investments/Bank, Cash and Cash EquivalentsThe college limits its counterparty exposures from its money market investment operations (financial assets that are neither past due nor impaired) by only dealing with Absa Bank, and Investec. No investments with a tenure exceeding twelve months are made.

Trade and Other ReceivablesTrade and Other Receivables are amounts owed by students and other organs of state are presented net of impairment losses. The college does not have a credit risk policy in place, but the exposure to credit risk is monitored on an ongoing basis. The college is compelled in terms of its constitutional mandate to provide all its residents with basic minimum services without recourse to an assessment of creditworthiness.

In the case of debtors whose accounts become in arrears, very little actions can be instituted against these debtors since “restriction of services”is inappropriate given government’s objectives for TVET colleges. However, as a last resort, accounts are “handed over for collection” as applicable in terms of Council’s Credit Control and Debt Managment Policy.

There were no material changes in the exposure to credit risk and its objectives, policies and processes for managing and measuring the risk during the year under

review. The college’s maximum exposure to credit risk is represented by the carrying value of each financial asset in the Statement of Financial Position, without taking into account the value of any collateral obtained. The college has no significant concentration of credit risk, with exposure spread over a large number of students, and is not concentrated in any particular sector or geographical area.

The college establishes an allowance for impairment that represents its estimate of anticipated losses in respect of trade and other receivables.

The college does not have any significant credit risk exposure to any single counterparty or any group of counterparties having similar characteristics. The college defines counterparties as having similar characteristics if they are related entities. The credit risk on liquid funds is limited because the counterparties are banks with high credit-ratings.

The table below shows the balance of the 5 major counterparties at the balance sheet date. Management is of the opinion that, although these parties are the 5 counterparties with highest outstanding balances, no sig-nificant credit risk exposure exists based on the payment history of the parties.

C o u n t e r p a r t y a n d L o c a t i o n

3 1 D e c e m b e r 2 0 1 7 3 1 D e c e m b e r 2 0 1 6

C r e d i t L i m i t

R

C a r r y i n g A m o u n t

R

C r e d i t L i m i t

R

C a r r y i n g A m o u n t

R

Department of Higher EducationWestern Cape Government (WCED)Department of LabourServices SETA1960 (Dept. Rural Dev. & Land Reform

122,677,00018,203,350

--

2,400,511

12,383,3415,967,712

550,800550,306410,960

124,047,48330,592,369

2,365,2003,207,7313,227,855

10,834,0008,660,417

745,200583,306

-

The maximum credit and interest risk exposure in respect of the relevantfinancial instruments is as follows:Receivables from Exchange TransactionsReceivables from Non-exchange TransactionsBank, Cash and Cash EquivalentsMaximum Credit and Interest Risk Exposure

The major concentrations of credit risk that arise from the college’s receivables in relation to customer classification are as follows:Exchange Debtors:- Student Debtors- Other Services- AR DebtorsNon-Exchange Debtors:- DHET

22,175,45812,383,341

3,252,35437,811,153

%44.20%

0.96%19.01%

35.83%

15,873,80710,834,000

9,464,05936,171,866

%8.32%1.77%

49.35%

40.56%

Total Credit Risk 100.00% 100.00%

Bank and Cash BalancesABSA Bank LtdCash Equivalents 3,252,354 9,464,059

Total Bank and Cash Balances 3,252,354 9,464,059

63

2 0 1 7R

2 0 1 6R

Credit quality of Financial Assets:The credit quality of financial assets that are neither past due nor impaired can be assessed by reference to external credit ratings (if available) or to historical information about counterparty default

Receivables from Exchange TransactionsCounterparties without external credit rating:Group 1Group 2

-3,356,380

--

3,356,380 -

Total Receivables from Exchange Transactions 3,356,380 -

Receivables from Non-exchange TransactionsGroup 1 12,383,341 10,834,000

Total Receivables from Non-exchange Transactions 12,383,341 10,834,000

Credit Quality Groupings:Group 1 - High certainty of timely payment. Liquidity factors are strong and the risk of non-payment is small.

Group 2 - Reasonable certainty of timely payment. Liquidity factors are sound, although ongoing funding needs may enlarge financing requirement. The risk of non-payment is small.

Group 3 - Satisfactory liquidity factors and other factors which qualify the entity as investment grade.However, the risk factors of non-payment are larger.

None of the financial assets that are fully performing, have been renegotiated in the last year.

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43.7 Liquidity Risk ManagementUltimate responsibility for liquidity risk management rests with the Council, which has built an appropriate liquidityrisk management framework for the management of the college’s short, medium and long-term funding and liquidity management requirements. The college manages liquidity risk by maintaining adequate reserves, banking facilities, by continuously monitoring forecast and actual cashflows and matching the maturity profiles of financial assets and liabilities.

Liquidity and Interest Risk TablesThe college ensures that it has sufficient cash on demand or access to facilities to meet expected operational expenses through the use of cash flow forecasts.

The following tables detail the college’s remaining contractual maturity for its non-derivative financial liabilities. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the college can be required to pay.

D e s c r i p t i o n

N o t eR e fi n

A F S

Av e r a g ee f f e c t i v eI n t e r e s t

R a t e

T o t a l6

M o n t h so r l e s s

6 - 1 2M o n t h s

1 - 2Ye a r s

2 - 5Ye a r s

M o r e t h a n

5 Ye a r s

# % R R R R R R

31 December 2017Non-interest Bearing 0.00% 25,393,043 25,393,043 - - - -

- Payables from Exchange transactions- Payables from Non- exchange transactions

11,512,323

13,880,720-

11,512,323

13,880,720

-

-

-

-

-

-

-

-

Fixed Interest RateInstruments 13.20% 877,524 334,589 209,601 333,333 -

- DBSA- Operating Lease: University Stellenbosch

13.20% 544,190

333,333

334,589 209,601

-

-

333,333

-

- -

26,270,567 25,727,632 209,601 333,333 - -


- Payables from Exchange transactions- Payables from Non- exchange transactions

12,687,636

14,946,855

12,687,636

14,946,855

-

-

-

-

-

-

-

-

Fixed Interest RateInstruments 13.20% 1,276,205 293,733 438,282 544,190 - -

- DBSA- Operating Loans

13.20% 1,276,205-

1,276,205-

438,282-

544,190-

--

--

28,910,696 27,928,224 438,282 544,190 - -

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The following table details the college’s expected maturity for its non-derivative financial assets. The tables below have been drawn up based on the undiscounted contractual maturities of the financial assets including interest that will be earned on those assets except where the college anticipates that the cash flow will occur in a different period.

D e s c r i p t i o n

N o t eR e fi n

A F S

Av e r a g ee f f e c t i v eI n t e r e s t

R a t e

T o t a l6

M o n t h so r l e s s

6 - 1 2M o n t h s

1 - 2Ye a r s

2 - 5Ye a r s

M o r e t h a n

5 Ye a r s

# % R R R R R R


- Trade Receivables from Exchange Transactions- Trade Receivables from Non-exchange Transactions- Cash and Cash Equivalents

20,097,625

12,383,3411,100

20,097,625

12,383,3411,100

-

--

-

--

-

--

-

--

Variable Interest Rate Instruments 4.72% 3,251,254 3,251,254 - - - -

- Call Deposits- Bank Account

845,8592,405,394

845,8592,405,394

--

--

--

--

35,733,319 35,733,319 - - - -

31 December 2016Non-interest Bearing 0.00% 25,265,248 25,265,248 - -

- Trade Receivables from Exchange Transactions- Trade Receivables from Non-exchange Transactions- Cash and Cash Equivalents

14,430,148

10,834,0001,100

14,430,148

10,834,0001,100

-

-

-

-

Variable Interest Rate Instruments 3.71% 9,462,959 9,462,959 - -

- Call Deposits- Bank Account

581,3798,881,580

581,3798,881,580

--

--

34,728,207 34,728,207 - - - -

43.8 Other Price RisksThe college is not exposed to equity price risks arising from equity investments as the college does not tradethese investments.

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4 4 . R E L AT E D PA R T Y T R A N S A C T I O N S

All Related Party Transactions are conducted at arm’s length, unless stated otherwise.

44.1 Interest of Related PartiesEntities with whom the College has a relationship:Controlling Entity:Entities under Common Control:

Department of Higher Education and Training (DHET) All Sectorial Education and Training Authorities (SETA’s)National Skills Fund (NSF)National Student Financial Aid Scheme (NSFAS)Other colleges

Councillors and/or management of the college had relationships with businesses during the financial period as indicated below:

N a m e o f R e l a t e d P e r s o nD e s i g n a t i o n D e s c r i p t i o n o f R e l a t e d P a r t y

R e l a t i o n s h i p

MinisterMr B NizimandiProfessor Hlengiwe MkhizeManagementAdams, WCoetzee, JJMGelderblom, IJ (until 30-06-2017)Gelderblom, IJ (from 01-07-2017)Myburgh, EC (until 30-06-2017)Neal, CR (from 17-07-2017)Peters, ECouncilBleazard, KDBakker, J (until 31-10-2017)Cloete, HCADladla. ZP (until 02-08-2017)Gelderblom, IJ (from 01-07-2017)Kabanyane, GCLingela, TSMacMaster, LLMMatolengwe, NMdludlu, M (from 06-09-2017)Myburgh, EC (until 30-06-2017)Peters, EPieterse, IPietersen, VRFPlaatjies, DVan der Merwe, HAVan Louw, CLInstitutionsCollege of Cape TownCommunity Colleges (CLC)Department of Higher Education and Training (DHET)Northlink CollegeFalse Bay CollegeWest Coast CollegeSouth Cape CollegeAgriSETABANKSETACATHSSETACETACHIETAETDP SETAEWSETAFP&M SETAHWSETAINSETAMerSETAPSETAServices SETAW & R Seta

MinsterMinster

VP: I&DVP: CSCFOActing PrincipalPrincipalActing: CFOVP: EDT

Higher Education and TrainingHigher Education and Training

OfficialOfficialOfficialOfficialOfficialOfficialOfficial

Related TVET CollegeDHETDHETRelated TVET CollegeRelated TVET CollegeRelated TVET CollegeRelated TVET CollegeSETAsSETAsSETAsSETAsSETAsSETAsSETAsSETAsSETAsSETAsSETAsSETAsSETAsSETAs

44.2 Income Received from Related PartiesDuring the year the income was received from the following Related Parties that are related to the college as indicated:

G o v e r n m e n tG r a n t s

R

S k i l l sT r a i n i n g

R

L e a r n e r s h i p sR

O u t s t a n d i n gB a l a n c e s

R

For the Year ended 31 December 2017Department of Higher Education and Training (DHET)National Skills Fund (NSF)BANKSETACATHSSETACETACHIETAETDP SETAEWSETAFP&M SETANorthlink CollegePSETAServices SETAW&R SetaCommunity Colleges (CLC)

123,356,804-----

---

2,670,575

-

--

67,2001,430,625

---

81,900

-

-19,022,333

-1,500

--

-631,040

-

429,957-

12,383,341

-8,992

93,57970,90039,00073,500

366,4003,521

550,306258,257

Total Income 126,027,379 1,579,725 20,084,830 13,847,796

For the Year ended 31 December 2016Department of Higher Education and Training (DHET) BANKSETACATHSSETACETACHIETAETDP SETAEWSETAFP&M SETAINSETAMERSETANorthlink CollegePSETAServices SETASouth Cape CollegeW&R SetaCommunity Colleges (CLC)

124,047,483--------

-

77,552-

713,5002,217,6251,430,625

--

303,897

-171,000

------

237,000

487,673901,001

79,8001,734,500

10,834,000--

93,579102,400395,000

73,500--

3,020213,700583,306

-46,800

Total Income 124,047,483 3,312,574 3,610,974 12,345,305

6868

R

December 2017Compensation of CouncilBleazard, DVan der Merwe, HAvan Louw, CLKabanyane, GCCloete, HAOlivier, ALingela, TS

27,16128,08314,86616,09513,97114,99627,901

143,074

December 2016Compensation of Council Bleazard, DVan der Merwe, HAvan Louw, CLKabanyane, GCCloete, HAOlivier, AMatolengwe, NLingela, TSMdudlu, MMacMaster, LLM

31,49240,512

37811,34824,565

374497

16,6987,481

10,652

143,997

44.3 Compensation of Related PartiesCompensation of Key Management Personnel and Councillors is set out in Notes, and below, Statement of Remuneration of Management, to the Annual Financial Statements.

D e c e m b e r 2 0 1 7

C o m p e n s a t i o n o f K e y M a n a g e m e n t P e r s o n n e l

B a s i cR

B o n u sR

L o n g - t e r m B e n e f i t s

R

T e r m i n a t i o n B e n e f i t

R

T o t a lR

Johanna Coetzee Corrie Myburgh Izak GeldeblomEbrahim PetersWendy AdamsChristiana Neal

603,986323,272607,220617,918541,078268,756

---

52,38440,65240,987

112,21490,436

256,84534,62961,643

-295,836

---

716,200709,544864,065704,932643,373309,743

2,962,230 134,023 555,768 295,836 3,947,858

Bonuses for Mrs Coetzee, Mrs Myburgh and Mr Gelderblom is paid out as part of monthly package.

D e c e m b e r 2 0 1 6

C o m p e n s a t i o n o f K e y M a n a g e m e n t P e r s o n n e l

B a s i cR

B o n u sR

L o n g - t e r m B e n e f i t s

R

T e r m i n a t i o n B e n e f i t

R

T o t a lR

Johanna Coetzee Corrie Myburgh Izak GeldeblomEbrahim PetersWendy Adams

554,209638,566549,902390,562475,439

30,14554,73429,81748,82062,832

175,086290,350235,746

90,839118,933

759,440983,651815,465530,221657,203

2,608,678 226,348.50 910,954 3,745,980

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4 5 . C O N T I N G E N T A S S E T S

The college was not engaged in any transaction or event during the year under review involving Contingent Assets.

2 0 1 7R

2 0 1 6R

45.1 Insurance Claims: 115,504 705,398

(i) Lost/Damaged Assets:(ii) Staff life insurance

15,504100,000

705,398

4 7 . G O I N G C O N C E R N A S S E S S M E N T

Management considered the following matters relating to the Going Concern:

(i) The Council adopted the 2017 Budget. This is sufficient to support the ongoing delivery of educational services to students.

(ii) DHET’s grant allocation is expected to increase based on the increased FTE’s being registered and therefore sufficient funding would be available for the following year.

(iii) Strict daily cash management processes are embedded in the college’s operations to manage and monitor all actual cash inflows and cash outflows in terms of the cash-flow forecast supporting the Budget. The cash management processes is complemented by monthly and quarterly reporting, highlighting the actual cash position, including the associated risks and remedial actions to be instituted.

Taking the aforementioned into account, management has prepared the Annual Financial Statements on the Going Concern Basis.

4 6 . E V E N T S A F T E R T H E R E P O R T I N G D AT E

No events having financial implications requiring disclosure occurred subsequent to 31 December 2017.

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