2011/2012 in year financial monitoring report · 2011/2012 in year financial monitoring report ......

2011/2012 IN YEAR FINANCIAL MONITORING REPORT

FOR THE PERIOD 1st JULY 2011 TO 31st DECEMBER 2011

2nd QUARTER REPORT

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TABLE OF CONTENTS 1. Introduction….............................................................................................5 2. Executive Summary...................................................................................6-12 3. Financial Performance (Expenditure & Revenue)....................................13-20 4. Capital Budget Performance………………………..…………….….………21-24 5. Cash Flow Position.....................................................................................25-28 6. Current Bank Balance, Investment and Borrowing......................................29-30 7. Performance on main tariff revenue collection……………………………......31-38 8. Recommendations………………………………………………………………….39

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IN-YEAR BUDGET STATEMENT TABLES: DECEMBER 2011 REPORT

The financial results for the period ended 31st December 2011 ( the 6th month of the 2011/2012 financial year) are attached consisting of the following tables, in Annexure A and Annexure B: ANNEXURE A: 1) Table C1: Monthly Budget Statement – Summary 2) Table C2: Monthly Budget Statement – Financial Performance (standard

classification) 3) Table C3: Monthly Budget Statement - Financial Performance (Revenue and

Expenditure by Municipal vote) 4) Table C4: Monthly Budget Statement – Financial Performance (Revenue and

Expenditure) 5) Table C5: Monthly Budget Statement - Capital Expenditure by vote, standard

classification and funding 6) Table C6: Monthly Budget Statement – Financial Position 7) Table C7: Monthly Budget Statement – Cash Flow ANNEXURE A: 1) Table SC1: Material variance explanations 2) Table SC2: Monthly Budget Statement – Performance Indicators 3) Table SC3: Monthly Budget Statement - Aged Debtors 4) Table SC4: Monthly Budget Statement - Aged Creditors 5) Table SC5: Monthly Budget Statement – Investment Portfolio 6) Table SC6: Monthly Budget Statement – Transfer and grant receipts 7) Table SC7: Monthly Budget Statement – Transfer and grant expenditures 8) Table SC8: Monthly Budget Statement – Councillor and Staff Benefits 9) Table SC9: Monthly Budget Statement – Actual and Revised targets for cash

receipts 10) Table SC12: Monthly Budget Statement – Capital Expenditure Trend 11) Table SC13a: Monthly Budget Statement – Capital expenditure on new assets by

asset class 12) Table SC13b: Monthly Budget Statement – Capital expenditure on renewal of

existing assets by asset class 13) Table SC13c: Monthly Budget Statement – Capital expenditure on repairs and

maintenance by asset class 14) Municipal manager’s quality certification

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ANNEXURE B: 1) Table 1: Capital Expenditure to date – by Capital Projects 2) Table 2: Capital Expenditure to date – payments from Cash Flow 3) Table 3: Revenue Activity Report 4) Table 4: Staff Arrears Service Accounts 5) Table 5: Councillors Service Accounts 6) Table 6:Investment Register 7) Table 7:Quarterly Money withdrawn from Bank Accounts 8) Table 8:Loan Register

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1. INTRODUCTION 1.1 PURPOSE

The purpose of this report is to inform the Finance Portfolio about the Financial Status quo of Mogale City Local Municipality and to comply with Section 52, Sections 71 of the MFMA and the requirements as promulgated in the Government Gazette No 32141 of 17th April 2009.

1.2 STRATEGIC OBJECTIVE To ensure sound and sustainable management of the financial affairs of the City.

1.3 BACKGROUND

Section 52(d) and section 71 of the MFMA and in terms of Section 28 of the Government Notice 32141 dated 17 April 2009, regarding the “ Local Government: Municipal Finance Management Act 2003 Municipal Budget and Regulations” necessitates that specific financial particulars be reported on and in the format prescribed. “Section 52(d) of the MFMA states that the mayor of the municipality must, within 30 days of the end of each quarter, submit a report to the council on the implementation of the budget and the financial state of affairs of the municipality;”

“Section 71 (1) of the MFMA states that, The accounting officer of a municipal must by no later than 10 working days after the end of each month submit to the mayor of the municipality and the relevant provincial treasury a statement in the prescribed format on the state of the municipality’s budget reflecting the following particulars for that month and for the financial year up to the end of that month.” “Section 28 of the Government Notice 32141, the monthly budget statement of a municipality must be in the format specified in Schedule C and include all required tables, charts and explanatory information, taking into account any guidelines issued by the Minister in terms of section 168(1) of the Act.”

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2. EXECUTIVE SUMMARY

2.1 SUMMARY STATEMENT OF FINACIAL PERFORMANCE Table 1: Operating Budget performance for the year to 31st December 2011

2011/2012 Approved

Budget

R 000

Actual billed/spend to date (in R and as a %

of the Approved Budget)

R 000 %

Pro-rata

Budget to date

R 000

Under/ over billed

/spend against Pro rata budget

R 000

% of pro rata

budget billed/ spent

%

Revenue 1 488 011 801,919 54% 744,006 57,913 108% Expenditure cash items (1 283 631) (639,289) 50% (641,816) 2,527 100% Expenditure non-cash items (depreciation and debt impairment )

(90, 981) (45,490) (50%) (45,491) 0 100%

TOTAL EXPENDITURE (1 374 612) (684,779) (50%) (687,306) 2,527 100% SURPLUS/ (DEFICIT)

113 399

117,140

8%

56,700

55,386

7%

Note: Negative (Expenditure) & Positive Revenue

2.1.1 During the 2011/12 financial year we will raise R1, 488,011,028 in billed revenue and operational grants, excluding capital grants of R115, 424,178

2.1.2 In line with the formats prescribed by the Municipal Budget and Reporting

Regulations, capital transfers and contributions are excluded from the operating statement, as inclusion of these revenue sources would distort the calculation of the operating surplus/ (deficit).

2.1.3 The summary of statement of financial performance in Annexure A, Table

C4, is prepared on a similar basis to the prescribed budget format, detailing revenue by source type and expenditure by input type.

2.1.4 To date, a total of R 685 million has been spent on the operational

approved budget; this includes non-cash items (representing 50% of the total approved expenditure budget for the year or 100% of the pro rata budget. These figures include non-cash items such as depreciation and debt impairment. Chart 1 below shows monthly expenditure per categories.

2.1.5 Expenditure that has been incurred but not yet paid, which is bulk

purchases for electricity & water amounts to R 33,838 million.

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2.1.6 To date a total of R 802 million has been billed (representing 54% of the total approved revenue budget for the year or 108% pro rata budget). Section 2 of this report gives more detail on the Operational Budget Performance Chart 2 in page 8 shows monthly collection rate.

2.1.7 The revenue shown in the above table is largely the amount of revenue

billed for the year to date. 2.1.8 The amount of actual cash collected or received for the main tariffs is R 521

million (representing 89% of the billed revenue) as shown in paragraph 2.1.9 in page 8 and in detail in section 7 of this report.

Chart 1 Monthly Expenditure Trends

56,340

130,167 135,363

83,617

163,080

116,212

4%

9% 10%6%

12%

8%

July 2011 Aug 2011 Sept 2011 Oct 2011 Nov 2011 Dec 2011

Note: This chart includes depreciation and debt impairment which are non-cash items

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2.1.9 PERFORMANCE ON REVENUE COLLECTION Table 2: Billed income – amount billed to date and cash received. Figures in R 000

Periods Amount billed for

year to date

Cash received as at 31st

December

2011

Collection rate as at 31st

December 2011

July 2011 90 028 82 795 92% August 2011 103 601 90 924 88% September 2011 104 316 99 978 96% October 2011 96 325 81 529 85% November 2011 93 848 94 245 100% December 2011 94 751 81 835 86% Total 582 869 531 306 91%

Note: This table excludes service reconnections and sundry billing. Billing is only on Property Rates and four main tariffs.

The Cumulative Collection Rate as at the end of December 2011 stands at 91%

- that is the amount of cash that has been received to date for the year is 91% of the billed amount. The payment level for the month of December 2011 is 86%, more information and detail on this performance is given in section 8 of the report.

Chart 2 Monthly Collection Rate

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Table 3: Capital Budget performance for the year to 31st December 2011

2011/2012 Approved Budget

R 000

Actual spend to date (in R and as a % of the

Approved Budget)

R 000 %

Pro rata

Budget to date

R 000

Under over

spend against pro rata budget

R 000

% of pro rata budget spent

%

EXPENDITURE 226 213 58,358 26% 113,106 54,749 52%

2.1.10 To date, only R58,358 million has been spent from the capital budget (this represents only 26% of the total approved expenditure budget for year or 52% of pro rata budget). Section 3 of this report gives more detail on this performance. Chart 3 2011/12 Capital Expenditure Monthly Trends: actual v target

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Chart 4 2010/11 Capital Expenditure: YTD actual v YTD target

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2.3 CASH FLOW REPORT OF MOGALE CITY FOR DECEMBER 2011: 2.3.1 CASH FLOW REPORT OF MOGALE CITY FOR 31st DECEMBER 2011: 2.3.1 CASH FLOW POSITION Table 4: Cash Flow Position as at 31st December 2011. Figures in Rm's Cash balance brought forward from 2011/12 17,649 Cash received for the year to date 907,981 Cash payments made for the year to date 925,930 Current cash position -300

2.3.2 Mogale City's cash in hand as at the end of December 2011 was -R300k amount

was made up as follows Source RM Absa-MIG

10,000

Sanlam Shares

285

Bank Balance

-10,584

Total cash in hand -300

The Operating Income for the month of December 2011 was R23,133m less than the operating income for the month of November 2011 which was R132,828m, the operating expenditure for the month of December 2011 was R24,709m less than the previous month. Month Operating

Income Operating Expenditure

Difference

RM RM RM Jul-11

104,185

160,759

-56,574 Aug-11

116,375

143,051

-26,676 Sep-11

142,412

126,980

15,433 Oct-11

91,989

86,594

5,395 Nov-11

132,828

159,268

-26,440 Dec-11

109,694

134,559

-24,864

Total 697,483

811,211

-113,728

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During the month of December 2011 collection levels was 91% and the operating income was R24, 864m less than the operating expenditure. The year to date shortage is R113, 728m.

BANK BALANCE, INVESTMENTS, AND BORROWING Table 5: Key Treasury Information as at 31st December 2011

Previous Month Current Position Change from previous month

Balance in current account R 31,105,020 -R 10,584,404 Decrease -R 41,689,425

Total investments held : Uncommitted Call (Sanlam Shares) R 283,040 R 284,504 Increase R 1,464 Committed call (MIG grants) R 0 R 10,000,000 Increase R 10,000,000

Committed : Fixed Deposits R 75,393,483 R 75,393,483 No movement R 0

Total external borrowing R 199,190,943 R 201,305,561 Increase R 2,114,618 More information on these treasury matters is given in section 5 of this report.

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3. FINANCIAL PERFORMANCE (EXPENDITURE BY MUNICIPAL VOTE)

Table C3: Operating expenditure for the year to 31st December 2011– by vote

R thousand Original Budget

Monthly actual

YearTD actual

YearTD budget

variance/ under over spend against pro rata budget

YTD variance/ % pro rata budget spent

Full Year Forecast

Expenditure by Vote –

Vote1 - POLITICAL OFFICE 28,844 2,400 13,311 14,422 1,110 92% 28,844

MAYOR'S OFFICE 11,997 1,181 6,352 5,999 (353) 106% 11,997

SPEAKER'S OFFICE 16,847 1,220 6,960 8,423 1,464 83% 16,847

–

Vote2 - MUNICIPAL MANAGER'S OFFICE 46,742 3,602 25,671 23,371 (2,300) 110% 46,742

ADMINISTRATION(MM) 1,992 68 1,081 996 (85) 109% 1,992

INTERNAL AUDIT 3,754 350 1,938 1,877 (61) 103% 3,754

PROJECT MANAGEMENT UNIT 5,194 360 2,114 2,597 483 81% 5,194

IDP & PERFORMANCE MANAGEMENT 2,300 185 1,044 1,150 106 91% 2,300

INFORMATION MANAGEMENT 22,319 1,991 14,477 11,160 (3,317) 130% 22,319

MARKETING & COMMUNICATION 10,281 581 4,611 5,141 530 90% 10,281

MONITORING & EVALUATION 901 67 406 451 44 90% 901

–

Vote3 - CORPORATE SUPPORT SERVICES 62,377 3,338 31,633 31,189 (444) 101% 62,377

ADMINISTRATION(EM) 2,609 411 2,679 1,305 (1,374) 205% 2,609

LEGAL SERVICES 13,747 928 7,580 6,873 (707) 110% 13,747

INTERGOVERMENTAL & CORPORATE ADMIN 29,985 1,420 11,136 14,992 3,857 74% 29,985

HUMAN CAPITAL MANAGEMENT 4,464 271 2,133 2,232 99 96% 4,464

HUMAN CAPITAL SUPPORT 11,573 309 8,105 5,786 (2,318) 140% 11,573

–

Vote4 - FINANCIAL SERVICES 107,261 7,447 59,413 53,631 (5,782) 111% 107,261

ADMINISTRATION(CFO) 6,011 739 3,790 3,005 (785) 126% 6,011

VALUATIONS 3,030 228 1,492 1,515 23 98% 3,030

REVENUE 46,199 2,203 22,834 23,099 265 99% 46,199

CREDIT CONTROL 15,755 2,369 13,266 7,878 (5,388) 168% 15,755

CREDITORS 11,557 881 5,225 5,778 553 90% 11,557

SUPPLY CHAIN MANAGEMENT 10,426 603 4,576 5,213 637 88% 10,426

BUDGET & TREASURY 14,285 424 8,230 7,142 (1,087) 115% 14,285

Vote5 - SOCIAL SERVICES 138,152 11,659 72,543 69,076 (3,467) 105% 138,152

ADMINISTRATION(EM) 4,328 280 2,212 2,164 (48) 102% 4,328

SOCIAL UPLIFTMENT 13,536 1,100 6,464 6,768 304 96% 13,536

CLINICS 2,796 32 241 1,398 1,157 17% 2,796

SPORTS,RECREATION,LIBRARIES,HERITAGE & MUSEUM 35,492 3,155 18,340 17,746 (593) 103% 35,492

LICENCES 10,946 886 5,950 5,473 (477) 109% 10,946

PUBLIC SAFETY 71,053 6,207 39,337 35,526 (3,811) 111% 71,053

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Vote6 - INTEGRATED ENVIRONMENTAL MANAGEMENT 126,955 11,431 67,569 63,477 (4,091) 106% 126,955


ENIVORNMENTAL MANAGEMENT 12,426 969 6,580 6,213 (367) 106% 12,426

MUNICIPAL HEALTH 65,553 6,738 39,998 32,776 (7,221) 122% 65,553

PARKS MANAGEMENT 46,890 3,561 19,835 23,445 3,610 85% 46,890

– – –

Vote7 - ECONOMIC SERVICES 42,185 2,679 17,358 21,093 3,735 82% 42,185

DEVELOPMENT & PLANNING 17,022 1,324 8,204 8,511 307 96% 17,022

ENTERPRISE DEVELOPMENT & TOURISM 4,553 328 1,813 2,276 464 80% 4,553

RURAL DEVELOPMENT 10,034 272 2,854 5,017 2,163 57% 10,034

HUMAN SETLLEMENTS 10,577 754 4,488 5,288 801 85% 10,577

Vote8 - INFRASTRUCTURE SERVICES 822,096 73,657 397,281 411,048 13,766 97% 822,096


WATER & SANITATION 237,253 21,122 120,447 118,626 (1,820) 102% 237,253

FLEET MANAGEMENT 5,869 509 3,188 2,934 (254) 109% 5,869

ELECTRICITY DISTRIBUTION 510,768 47,256 237,569 255,384 17,816 93% 510,768

MUNICIPAL BUILDINGS 26,033 2,535 9,301 13,016 3,715 71% 26,033

ROADS & STORMWATER 40,031 2,048 25,690 20,015 (5,674) 128% 40,031

Total Expenditure by Vote 1,374,612 116,212 684,779 687,306 2,527 100% 1,374,612 3.3.1 OPERATING EXPENDITURE BY VOTE

3.3.1.1 Table C3 above shows that R685 million had been spent at the end of

December 2011 from the operational budget these includes non-cash items. The spend-to-date represents 50% of the total Approved Budget or 100% of the pro rata budget including non-cash items.

3.3.1.2 Cost drivers common in most departments are overtime, annual bonus, and leave buyoffs that contributed to overspending of pro rata budget. Leave buyoffs is mostly for payment of services by employees.

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3.3.2.1 OPERATING EXPENDITURE BY TYPE Table C4: Operating expenditure for the year to 31st December 2011– by vote

Description

Budget Year 2011/12

Original Budget

Monthly actual Year TD actual Year TD

budget



Full Year Forecast

R thousands % Expenditure By Type

Employee related costs 418,215 32,711 212,394 209,108 (3,286) 102% 418,215 Remuneration of councillors 19,312 1,427 8,556 9,656 1,100 89% 19,312 Debt impairment 80,528 6,711 40,264 40,224 0 100% 80,528 Depreciation & asset impairment 10,453 871 5,227 5,227 – 100% 10,453 Finance charges 22,984 794 13,033 11,492 (1,542) 113% 22,984 Bulk purchases 484,452 49,790 238,517 242,226 3,709 98% 484,452 Contracted services 87,992 9,972 59,848 43,996 (15,851) 136% 87,992 Transfers and grants 7,236 1,172 4,932 3,618 (1,314) 136% 7,236 Other expenditure 243,440 12,764 102,009 121,720 19,711 84% 243,440

Total Expenditure 1,374,612 116,212 684,779 687,306 2,527 100% 1,374,612

3.3.2.1 Annexure A, Table C4 sets out the monthly expenditure to date on the operating budget analysed by type.

In overall terms:

Expenditure on employee’s costs and remuneration to council is 50% of the total Approved Budget for the year or 101% of pro rata budget.

Depreciation and debt impairment is showing movements against

approved budget – but these are an ‘internal’ costs and have not yet been processed into the financial system for the purpose of accurate reporting Finance department has include them in the total actual expenditure: however this is not a cause for any concern to the final expenditure position of the council. We normally process these two line items during the process of closing the financial year.

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3.3.2.2 The discussion set out below looks at the major (under) and over expenditure on individual budgets.

o Interest on External borrowings. Expenditure on this item is 57% of

the total Approved Budget for the year. The interest payments are contractually fixed but vary on a monthly basis due to different banks being involved and different payment dates agreed to.

o Contracted services is overspent by R15,851 on pro rata, the most contributor for this over expenditure are audit fees, connections via contractor, lease of IT equipments, vehicle leases, security and consultants.

o Insurance Costs. R1 212 million has been spent to date (36%) of the

Approved Budget for the year). The expenditure reflected will change as insurance premiums have not yet been paid for the whole year.

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3.3.2.3 EXPENDITURE ON STAFF BENEFITS

Table SC8: Operating expenditure for the year to 31st December 2011– by vote

Summary of Employee and Councillor remuneration

Budget Year 2011/12

Original Budget

Monthly actual

Year TD actual

Year TD budget



Full Year Forecast

R thousands % Councillors (Political Office Bearers plus Other)

Salary 11,266 851 5,104 5,633 529 91% 11,266 Pension Contributions 1,988 125 748 994 246 75% 1,988 Medical Aid Contributions 1,175 46 276 588 311 47% 1,175 Motor vehicle allowance 4,016 335 2,004 2,008 4 100% 4,016 Cell phone and other

allowances 867 71 424 434 10 98% 867 Sub Total - Councillors 19,312 1,427 8,556 9,656 1,100 89% 19,312

Senior Managers of the Municipality

Salary 8,369 459 2,663 4,184 1,521 64% 8,369 Pension Contributions 511 33 196 255 59 77% 511 Medical Aid Contributions 111 5 33 55 23 59% 111 Motor vehicle and cell phone 1,131 90 506 566 59 90% 1,131 Performance Bonus 1,068 – 924 534 (389) 173% 1,068

Sub Total - Senior Managers of Municipality 11,189 588 4,322 5,595 1,272 77% 11,189

Other Municipal Staff Basic Salaries and Wages 266,743 21,524 128,661 133,372 4,710 96% 266,743

Pension Contributions 52,229 4,103 24,659 26,114 1,455 94% 52,229 Medical Aid Contributions 21,750 1,702 9,612 10,875 1,263 88% 21,750 Motor vehicle and cell phone 31,291 2,538 15,002 15,645 644 96% 31,291 Housing allowance 3,448 272 1,645 1,724 79 95% 3,448 Overtime 10,533 1,671 10,243 5,267 (4,977) 195% 10,533

Annual Bonus 21,032 313 18,248 10,516 (7,733) 174% 21,032 Sub Total - Other Municipal Staff 407,026 32,123 208,071 203,513 (4,558) 102% 407,026

Total Parent Municipality 437,527 34,138 220,950 218,764 (2,186) 101% 437,527 TOTAL SALARY, ALLOWANCES & BENEFITS 437,527 34,138 220,950 218,764 (2,186) 101% 437,527 TOTAL MANAGERS AND STAFF 418,215 32,711 212,394 209,108 (3,286) 102% 418,215

3.3.2.4 Section 66 of the MFMA (Municipal Finance Management Act, 2003) requires that expenditures incurred by the municipality on staff salaries; wages, allowances and benefits are regularly reported to Council. This information is

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given in Annexure A, Table SC8 above for this report, along with the equivalent information on Councillor Allowances.

3.3.2.5 Total expenditure on staff and councillor benefits is 50% of the total Approved

Budget or 101% pro rata budget. 3.3.2.6 Overtime overspent by R4, 977 million (or 95%) of the total pro rata budget. 3.3.2.7 The following Departments have overspent on overtime in their pro rata

budgets: Corporate Services – R77,145 Financial Services – R198,538 Social Services – R1,981,481 Integrated Environmental Management - R1,134,218 Infrastructure - R1,585,572

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3.4 FINANCIAL PERFORMANCE BY SOURCE (REVENUE) Table 7: Operating revenue for the year to 31st December 2011 – by source

Original Budget

Monthly actual

Year TD actual

Year TD budget



Full Year Forecast

R thousands % Revenue By Source

Property rates 253,084 20,714 120,805 126,542 5,736 95% 253,084 Service charges - electricity revenue 628,068 50,944 331,529 314,034 (17,495) 106% 628,068 Service charges - water revenue 171,681 14,463 85,953 85,840 (113) 100% 171,681 Service charges - sanitation revenue 82,528 7,123 42,633 41,264 (1,369) 103% 82,528 Service charges - refuse revenue 67,784 6,142 34,785 33,892 (893) 103% 67,784 Service charges - other 13,454 – – 6,727 6,727 0% 13,454 Rental of facilities and equipment 5,056 89 969 2,528 1,559 38% 5,056 Interest earned - external investments 2,272 7 215 1,136 921 19% 2,272 Interest earned - outstanding debtors 6,875 618 6,216 3,437 (2,779) 181% 6,875 Fines 14,083 138 6,620 7,041 421 94% 14,083 Licences and permits 29 1 11 14 4 74% 29 Agency services 16,135 3,884 16,206 8,068 (8,139) 201% 16,135 Transfers recognised - operational 200,724 658 142,283 100,362 (41,921) 142% 200,724 Other revenue 26,240 1,828 13,694 13,120 (574) 104% 26,240

Total Revenue (excluding capital transfers and contributions) 1,488,011 106,609 801,919 744,006 (57,914) 108% 1,488,011

3.4.1 Revenue as at end of December 2011 (largely billed income rather than cash

received) was R 802 million. This represents 54% of the total Approved Budget for the year or 108% of the pro rata budget.

3.4.2 Interest earned on external investment. Normally this represent a small amount

of interest income which is generated from the short term investments held when there are temporary surpluses of cash.

3.4.3 Interest earned on outstanding debtors. This is interest levied for main tariffs

on outstanding debt. 3.4.4 Vehicle Registration. Vehicle registration is an in and out vote. As the money is

being collected, a subsequent payment is made to the Gauteng Provincial Government.

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3.5 OVERALL PERFORMANCE ON THE OPERATING BUDGET

Table 8: Operating Budget Performance for the year to 31st December 2011

2011/2012 FULL YEAR

R 000

PRO RATA

BUDGET FOR THE YEAR TO DATE

R 000

Expenditure Budget (1 374 612) (684,306) Actual to date (684,779) (685,779) Variance - under / over spending (689,833) (2,527) % of Budget Spent 50% 100% Revenue Budget 1 488 011 744,006 Actual billed to date 801,919 801,919 Variance – under (over) revenue 686,092 57,913 % of Budget Billed 54% 108% Surplus/(Deficit) Budgeted Position 113 399 56,700 Surplus/(Deficit) position to date 117,140 117,140

Note: Positive (Expenditure) & Negative Revenue Exclude capital grants revenue

To summarise, expenditure to date is 50% of the total Approved Budget for the year or 100% of the pro rata budget.

Billing to date represents 54% of the total Approved Budget for the year or

108% of the pro rata budget. A decrease in cash of R31, 688m is shown for December 2011. The income

derived from main revenue tariffs for December 2011 was R88, 054m vs. an expected amount of R93, 719m at a projected collection rate of 94%.

Thus the overall performance of the operating budget at this point in time gives

a cause for concern especially low collection rate, contracted services (see page 16 ) and overtime overspending mentioned in paragraph 3.3.2.7 (page 17).

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4. CAPITAL BUDGET PERFORMANCE 4.1 CAPITAL EXPENDITURE BY VOTE Table 9: Capital expenditure for the year to 31st December 2011 – by vote

Original Budget

Capital expenditure incurred to

date

% of Approved Budget Spent to date

Year TD budget



Political Office - - 0% - - 0% Office of the Chief Whip - - 0% - - 0%

Municipal Manager’s Office 4,234 - 0% 2,117 2,117 0% Internal Audit 120 - 0% 60 60 0% Project Management Unit 4,114 - 0% 2,057 2,057 0%

Corporate Support Services 17,579 263 1% 8,789 8,526 3% Corporate Services 1,320 263 20% 660 397 40% Human Capital Support 50 - 0% 25 25 0% Information Technology 3,825 - 0% 1,913 1,913 0% Marketing & Communication 29 - 0% 15 15 0% District Management Area 12,355 - 0% 6,177 6,177 0%

Municipal Finance Management 500 12 2% 250 238 5%

Social Services 3,103 7,862 253% 1,552 (6,310) 507% Social services - 5,880 #DIV/0! - (5,880) 0% Sports and Recreation 1,936 1,984 102% 968 (1,015) 205% Libraries 1,090 - 0% 545 545 0% Public Safety 78 (2) -3% 39 41 -5%

Economic Services 36,100 - 0% 18,050 18,050 0% Tourism 4,500 - 0% 2,250 2,250 0% Development & Planning 20,030 - 0% 10,015 10,015 0% Rural Development 11,570 - 0% 5,785 5,785 0%

Integrated Environmental Management 29,077 5,509 19% 14,539 9,030 38% Administration 550 - 0% 275 275 0% Parks & Cemeteries 8,790 2,819 32% 4,395 1,576 64% Environmental management 20 - 0% 10 10 0% Municipal Health 19,717 2,689 14% 9,859 7,169 27%

Infrastructure Services 135,619 44,712 33% 67,810 23,098 66% Building Facilities - 2,087 0% - (2,087) 0% Water and Sanitation 70,566 25,172 36% 35,283 10,111 71% Electricity 38,500 10,739 28% 19,250 8,511 56% Roads & storm water 26,553 6,713 25% 13,277 6,564 51% TOTAL CAPITAL BUDGET 226,213 58,358 26% 113,106 54,749 52%

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4.1.1 Table 9 above shows expenditure as at end of December 2011 on the capital budget per vote. In overall terms only 26% of the capital budget has been spent or 52% of pro rata budget.

4.2 CAPITAL EXPENDITURE BY PROJECT 4.2.1 Annexure B, Table 1 gives details of expenditure incurred to date on each capital

project. 4.3 FUNDING OF THE CAPITAL BUDGET Table 10: Funding of capital expenditure for the year to 31st December 2011 Source of Funding

2011/2012 Approved Budget

R 000

Financing of capital

expenditure incurred to date

R 000

National Government Grants - Municipal Infrastructure Grant 77 916 34 513 - Neighbourhood Development Fund 20 000 0 - EPWP 4 064 0 - DLG:DMA Funding 5 284 0 - Department of Water Affairs 0 0

Total National Government Grants 107 264 34 513 Provincial Government Grants

- Sports, Rec. Arts 1 090 0 - Social Development 0 5 880

Total Grants from Province 1 090 5 880 District Municipality grants

- WRDM:DMA Funding 7 071 0 Total Grants from District 7 071 0 Council’s Own Funds

- Own Funds 110 789 17 934 - External Loan 0 30

Total Own Funds 110 789 17 964 TOTAL FUNDING 226 213 58 358

Due to the new regulations from National Treasury which prohibits municipalities to adjust annual budget twice a year. We are facing the challenge of projects which are running beyond one financial year in circumventing the problem a letter with an attached list of projects was written to National Treasury to request approval to spend the grants in the

23

interim, National Treasury suggested that we make application to Provincial Government and we are still awaiting response from Provincial Government. 4.4 GRANTS – ALLOCATIONS RECEIVED AND EXPENDITURE INCURRED 4.4.1 Section 71 of the MFMA requires that the amount of grant allocations received by

the municipality, and the amount of expenditure funded by these allocations, is reported monthly (including equitable share). Annexure A, Table SC6 (receipts) and SC7 (expenditure) gives this information.

4.4.2 Table SC6 (receipt) show that MCLM expects to obtain R316 058 million of grants

from other spheres of government for 2011/2012. This amount is for funding both the operational and capital budget. By the end of 31st December 2011, R 213,272 million had been received.

Table SC6: Transfers & Grants- Receipt for the year to 31st December 2011

Description

Original Budget

Monthly actual

Year TD actual

Year TD budget



Full Year

Forecast

Operating Transfers and Grants National Government: 194,696 – 140,873 97,348 (43,525) 145% 194,696

Equitable share 189,605 – 138,823 94,803 (44,021) 146% 189,605 Finance Management grant 1,250 – 1,250 625 (625) 200% 1,250 Municipal Systems Improvement 800 – 800 400 (400) 200% 800 MIG (PMU) 3,041 – – 1,521 1,521 0% 3,041

Provincial Government: 6,028 490 3,355 3,014 (341) 111% 6,028 Sports and Recreation 4,400 – 1,600 2,200 600 73% 4,400 Expanded Public Works Programme – – 326 – (326) 0% – Seta- Training 1,628 490 1,429 814 (615) 176% 1,628

Total Operating Transfers and Grants 200,724 490 144,228 100,362 (43,866) 144% 200,724

Capital Transfers and Grants

National Government: 107,264 326 58,044 53,632 (7,054) 108% 107,264

Municipal Infrastructure Grant (MIG) 77,916

57,718 38,958 (18,760) 148% 77,916 Neighbourhood Development Fund 20,000 – – 10,000 10,000 0% 20,000 EPWP 4,064 326 326 2,032 1,706 16% 4,064 DLG:DMA Funding 5,284 – – 2,642 2,642 0% 5,284

Provincial Government: 1,000 2,200 11,000 500 (10,500) 2200% 1,000 Sport and Recreation 1,000 – 3,800 500 (3,300) 760% 1,000 Social Development – 2,200 7,200 – (7,200) 0%

District Municipality: 7,071 – – 3,535 3,535 0% 7,071 WRDM: DMA Funding 7,071 – – 3,535 3,535 0% 7,071

Total Capital Transfers and Grants 115,335 2,526 69,044 57,667 (11,377) 120% 115,335 TOTAL RECEIPTS OF TRANSFERS & GRANTS 316,058 3,016 213,272 158,029 (55,243) 135% 316,058

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4.1.1 Table SC7 (expenditure) shows that R 168,753 million had been spent to

date. The table below gives the detailed report on expenditure. Table SC7: Transfers & Grants - Expenditure for the year to 31st December 2011

Description

Original Budget

Monthly actual

Year TD actual

Year TD budget



Full Year Forecast

EXPENDITURE Operating expenditure of Transfers and Grants

National Government: 194,696 64,850 125,677 97,348 (28,328) 129% 194,696 Equitable share 189,605 64,616 123,868 94,803 (29,065) 131% 189,605 Financial Management 1,250 52 436 625 189 70% 1,250 Municipal System Improvement 800 48 436 400 (36) 109% 800 MIG (PMU) 3,041 135 936 1,521 584 62% 3,041

Provincial Government: 6,028 434 2,257 3,014 756 75% 6,028 Sports and Recreation 4,400 434 1,635 2,200 565 74% 4,400 Seta- Training 1,628

591 814 223 73% 1,628

Bontle ke Botho – – 31 – (31) 0% – District Municipality: – – 425 – (425) 0% – WRDM: HIV/AIDS – – 425 – (425) 0% –

Total operating expenditure of Transfers and Grants: 200,724 65,285 128,359 100,362 (27,997) 128% 200,724

Capital expenditure of Transfers and Grants National Government: 107,264 1,423 34,513 53,632 19,119 64% 107,264

Municipal Infrastructure Grant (MIG) 77,916 1,423 34,513 38,958 4,445 89% 77,916 Neighbourhood Development Fund 20,000 – – 10,000 10,000 0% 20,000 EPWP 4,064 – – 2,032 2,032 0% 4,064 DLG:DMA Funding 5,284 – – 2,642 2,642 0% 5,284

Provincial Government: 1,000 341 5,880 500 (5,380) 1176% 1,000 Sport and Recreation 1,000

500 500 0% 1,000

Social Development

341 5,880 – (5,880) 0% District Municipality: 7,071 – – 3,535 3,535 0% 7,071

WRDM:DMA Funding 7,071

3,535 3,535 0% 7,071 Total capital expenditure of Transfers and Grants 115,335 1,764 40,394 57,667 17,274 70% 115,335

TOTAL EXPENDITURE OF TRANSFERS AND GRANTS 316,058 67,049 168,753 158,029 (10,723) 107% 316,058

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5. CASH FLOW POSITION

5.1 The cash flow position for the 2011/12 year is given in the Table C7 cash Flow.

2010/11 Budget Year 2011/12Audited

OutcomeOriginal Budget

Adjusted Budget

Monthly actual

YearTD actual

YearTD budget

YTD variance

YTD variance

Full Year Forecast

R thousands 1 %CASH FLOW FROM OPERATING ACTIVITIESReceipts

Ratepay ers and other 1,178,437 1,456,684 109,694 750,233 728,342 21,891 3% 1,456,684 Gov ernment - operating 188,122 200,724 – 91,581 91,581 – 200,724 Gov ernment - capital 71,905 115,424 – 62,718 62,718 – 115,424 Interest 1,070 2,272 – 250 1,136 (886) -78% 2,272 Div idends – – – – – –

PaymentsSuppliers and employ ees (1,345,206) (1,508,238) (134,558) (813,175) (754,119) 59,056 -8% (1,508,238) Finance charges (20,887) (22,984) – (10,971) (10,971) – (22,984) Transfers and Grants – – – – – – –

NET CASH FROM/(USED) OPERATING ACTIVITIES 73,443 243,883 – (24,863) 80,636 118,687 (38,051) -32% 243,883

CASH FLOWS FROM INVESTING ACTIVITIESReceipts

Proceeds on disposal of PPE – – – Decrease (Increase) in non-current debtors (625) (312) 312 -100% (625) Decrease (increase) other non-current receiv ables – – – Decrease (increase) in non-current inv estments – – –

PaymentsCapital assets (125,129) (226,213) (6,825) (93,428) (113,106) (19,678) 17% (226,213)

NET CASH FROM/(USED) INVESTING ACTIVITIES (125,129) (226,838) – (6,825) (93,428) (113,419) (19,991) 18% (226,838)

CASH FLOWS FROM FINANCING ACTIVITIESReceipts

Short term loans – – – – – – Borrow ing long term/refinancing 53,000 – – – – – Increase (decrease) in consumer deposits – – – – – –

PaymentsRepay ment of borrow ing (12,213) (12,265) – (5,157) (5,157) – (12,265)

NET CASH FROM/(USED) FINANCING ACTIVITIES 40,787 (12,265) – – (5,157) (5,157) – (12,265)

NET INCREASE/ (DECREASE) IN CASH HELD (10,900) 4,781 – (31,688) (17,949) 111 4,781 Cash/cash equiv alents at beginning: 28,549 17,649 17,649 17,649 17,649 Cash/cash equiv alents at month/y ear end: 17,649 22,430 – (300) 17,760 22,430

Description Ref

GT481 Mogale City - Table C7 Monthly Budget Statement - Cash Flow - M06 December

26

GT481 Mogale City - Supporting Table SC9 Monthly Budget Statement - actuals and revised targets for cash receipts - M06 December

July August Sept October Nov Dec January Feb March April May JuneR thousands 1 Outcome Outcome Outcome Outcome Outcome Outcome Budget Budget Budget Budget Budget BudgetCash Receipts By Source

Property rates 21,971 20,528 20,822 18,261 25,780 17,572 19,192 19,192 19,192 19,192 19,192 14,473 235,368 266,446 301,595 Property rates - penalties & collection charges – – – – – – – Service charges - electricity revenue 42,260 55,137 58,627 47,898 48,159 40,152 47,850 47,850 47,850 47,850 47,850 54,690 586,174 704,669 847,032 Service charges - water revenue 11,138 11,688 14,515 10,772 13,219 10,775 14,896 14,896 12,896 12,896 12,896 20,168 160,755 188,839 219,256 Service charges - sanitation revenue 5,934 5,503 6,868 4,453 5,966 3,815 6,258 6,258 6,258 6,258 6,258 12,921 76,751 86,886 98,348 Service charges - refuse 3,686 3,720 3,587 3,519 4,706 2,797 4,892 4,892 4,892 4,892 4,892 13,517 59,991 67,913 76,872 Service charges - other 2,058 2,800 3,151 1,958 2,509 2,666 1,717 1,717 1,717 1,717 1,717 7,845 31,572 36,083 41,266 Rental of facilities and equipment 338 394 – – – 459 421 421 421 421 421 1,758 5,056 5,663 6,399 Interest earned - external investments 11 72 106 30 – – 189 189 189 189 189 1,105 2,272 2,272 2,272 Interest earned - outstanding debtors 1,346 1,199 1,246 1,374 434 647 573 – – – 58 6,875 7,700 8,701 Dividends received – – – – – – – – – – – – – – – Fines – 734 432 1,911 2,132 345 1,174 1,174 1,174 1,174 1,174 2,661 14,083 15,772 17,823 Licences and permits 2,852 6,195 – – – 2,114 5,311 5,311 5,311 5,311 5,311 26,015 63,731 52,965 52,965 Agency services 511 1,147 1,507 1,633 1,526 – 1,345 1,345 1,345 1,345 1,345 3,088 16,135 10,591 10,591 Transfer receipts - operating 79,687 4,650 – 3,622 59,821 – 1,789 47,401 389 389 389 2,587 200,724 223,829 236,920 Other revenue 12,069 7,259 31,551 199 25,190 28,353 17,349 17,349 17,349 17,349 17,349 8,825 200,193 203,217 205,981

Cash Receipts by Source 183,862 121,024 142,412 95,630 189,441 109,694 122,957 167,996 118,984 118,984 118,984 169,710 1,659,680 1,872,845 2,126,018 – Other Cash Flows by Source –

Transfer receipts - capital – 40,479 – – 22,239 – 5,000 9,611 33,239 – – 4,856 115,424 125,630 130,844 Contributions & Contributed assets – – – – – – – – – – – – – Proceeds on disposal of PPE – – – – – – – – – – – – – – – Short term loans – – – – – – – – – – – – – Borrowing long term/refinancing – – – – – – – – – – – – – – – Increase in consumer deposits – – (625) (625) (650) (676) Receipt of non-current debtors – – – – – – Receipt of non-current receivables – – – – – – Change in non-current investments – – – – – – – – – – – – – – –

Total Cash Receipts by Source 183,862 161,503 142,412 95,630 211,680 109,694 127,957 177,607 152,223 118,984 118,984 173,942 1,774,480 1,997,825 2,256,187 – Cash Payments by Type –

Employee related costs 32,588 31,640 32,278 32,344 49,903 32,471 33,900 33,918 34,081 34,756 33,613 36,723 418,215 460,247 506,272 Remuneration of councillors 1,412 1,415 1,387 1,450 1,409 1,423 1,691 1,592 1,253 1,250 834 4,196 19,312 19,539 20,752 Collection Costs – 1,500 1,500 1,580 1,666 Interest paid 1 2,607 7,007 678 1,695 – 242 1,416 7,200 0 1,414 723 22,984 21,774 21,145 Bulk purchases - Electricity 59,274 53,447 39,760 8,772 40,979 39,474 23,187 19,961 22,554 8,917 16,357 40,085 372,766 472,332 504,026 Bulk purchases - Water & Sewer 610 8,262 10,911 3,549 20,757 11,231 957 8,830 8,576 9,190 9,965 21,225 114,062 128,596 144,999 Other materials 6,941 1,488 9,077 4,737 6,976 15,149 4,368 11,345 14,130 7,921 16,214 15,132 113,478 119,492 126,064 Contracted services 27,844 15,607 13,607 23,342 16,600 14,815 – 2,490 114,304 106,163 110,257 Grants and subsidies paid - other municipalities – – – – – – – – – – – – – – – Grants and subsidies paid - other – 578 – – – – – – – – – 6,657 7,236 7,619 8,038 General expenses 8,674 11,339 5,630 7,350 6,051 3,564 5,382 5,781 7,653 4,343 5,899 35,127 106,793 114,756 123,578

– Cash Payments by Type 137,344 126,382 119,656 82,222 144,369 118,126 69,727 82,843 95,448 66,378 84,295 163,859 1,290,650 1,452,098 1,566,798

– Other Cash Flows/Payments by Type

Capital assets 11,497 21,724 20,433 14,729 18,220 6,825 13,217 11,745 16,681 19,632 12,476 59,033 226,213 240,078 306,804 Repayment of borrowing 12 2,228 468 437 2,012 – 182 1,208 251 13 903 4,550 12,265 11,856 14,062 Other Cash Flows/Payments 23,871 19,768 14,332 5,050 16,594 16,432 21,892 24,294 9,013 20,656 21,512 47,157 240,572 280,861 350,099

Total Cash Payments by Type 172,724 170,101 154,889 102,438 181,196 141,383 105,019 120,090 121,394 106,679 119,187 274,599 1,769,699 1,984,893 2,237,763 – NET INCREASE/(DECREASE) IN CASH 11,138 (8,599) (12,477) (6,808) 30,485 (31,688) 22,938 57,517 30,830 12,305 (203) (100,657) 4,781 12,933 18,424

Cash/cash equivalents at the month/year beginning: 17,649 28,787 20,189 7,711 903 31,388 (300) 22,638 80,156 110,985 123,291 123,088 17,649 22,430 35,363 Cash/cash equivalents at the month/year end: 28,787 20,189 7,711 903 31,388 (300) 22,638 80,156 110,985 123,291 123,088 22,430 22,430 35,363 53,787

Budget Year +1

Budget Year +2 2013/14

DescriptionBudget

Year

Ref Budget Year 2011/12 2011/12 Medium Term Revenue & Expenditure Framework

27

5.2. A summary of the cash flow for the year is reflected in SC9. SC9 reflects a decrease in the cash and investments position more clearly. A decrease in cash of R31, 688m is shown for December 2011. The income derived from main revenue tariffs for December 2011 was R88, 054m vs. an expected amount of R93, 719m at a projected collection rate of 94%.

5.3 As at 31st December 2011 MCLM's bank balance was (R10, 584,404) 5.4 The total cash received during the month of December 2011 amounted to R1,

016,660m which is R76, 004m more than the expected amount of R940, 656m. Total Actual expenditure for the same period amounted to R1, 042,090m which is R174, 082m more than the budgeted expenditure of R868, 008m.

5.5 The total cash received includes cash received for Operating Activities such as the

sale of water, electricity, fees charged for refuse removal and sanitation as well as other service charges.

5.6 The total cash received from Operating Activities was R697, 483m from the

expected budget at 94% collection rate of R730, 174m. Council therefore received R32, 692m less operational income than expected.

5.7 The Total Income was made up of the following: Figures in Rm’s

Figures in Rm's Revenue Source Expected Income Actual Income Difference

RM RM RM Property Rates R 120,152 R 126,167 R 6,015 Electricity R 280,379 R 281,633 R 1,254 Water R 69,673 R 68,129 R -1,544 Sanitation R 37,548 R 32,847 R -4,701 Refuse R 29,352 R 22,530 R -6,822 PP Electricity R 15,721 R 14,710 R -1,010 PP Water R 7,703 R 8,088 R 385 Other Income R 169,646 R 143,378 R -26,268

Sub-Total R 730,174 R 697,483 R -32,692 Investments Redeemed R 0 R 108,679 R 108,679 Operating Grants R 147,763 R 147,780 R 17 External Loan Received R 0 R 0 R 0 Capital Grants R 62,718 R 62,718 R 0

Total Income R 940,656 R 1,016,660 R 76,004 5.8 Other Service Charges, amounting to R8, 273m consist of income for connection

and re-connection fees, building plan fees, cemetery fees and landfill site fees.

5.9 Total Operating Expenditure amounted to R808, 888m which was R74, 992m less than the budgeted expenditure of R 733, 896m.

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5.10 Total Expenditure was made up of the following: Figures in Rm’s

Expenditure Item Expected Expenditure Actual Expenditure Difference RM RM RM

Salaries R 229,814 R 219,719 R 10,094 Electricity R 216,738 R 241,705 R -24,967 Water R 56,222 R 54,069 R 2,154 Sewer R 1,133 R 1,250 R -118 Other Creditors R 229,989 R 292,144 R -62,155

Sub-Total R 733,896 R 808,888 R -74,992 Investments made R 0 R 119,852 R -119,852 Financing Activities R 17,145 R 17,145 R 0 Operating Grants R 3,861 R 2,778 R 1,083 Capital Expenditure R 113,106 R 93,428 R 19,678

Total Expenditure R 868,008 R 1,042,090 R -174,082 Annexure B, Table 2 displays the capital expenditure to date and Table 8 displays withdrawals for the second quarter.

`

5.11 The Council did not receive MIG Grant during the month of December 2011.

29

6. CURRENT BANK BALANCE, INVESTMENTS, AND BORROWING 6.1 BALANCE IN CURRENT ACCOUNTS Table 11: Balance in current account as at 31st December 2011.

STANDARD BANK

FIRST NATIONAL BANK

TOTAL AVAILABLE

Balance

-R14,611,258.31 R4,026,853.85

(R10,584,404.46)

6.2 INVESTMENTS 6.2.1. SC5 gives the Investment portfolio as at 31st December 2011. 6.2.2 MCLM has investments totalling R85, 678m. Of this amount, R75, 393m are

investments that are linked to the bullet loans previously taken out by the municipality. These investments must be used to repay the bullet loans at the end of the loan period or when a consolidation or restructuring of the loans are undertaken.

6.3 LOANS 6.3.1 MCLM has long term loans outstanding of R201, 306m. An increase of R2, 115m

was due to the interest accrued during the month of December 2011.

30

6.4 SHORT TERM BORROWING 6.4.1 Section 45 (3) (iii) of the MFMA requires the accounting officer to notify the Council

in writing as soon as practical of the amount, duration and cost of any short term loan (overdraft facility) incurred by the municipality.

Mogale City utilised the overdraft facility during the month of December 2011. On average Mogale City utilised overdraft facility to the value of R13, 234,258 Below is the schedule of days that Mogale utilised the overdraft: Date Amount 1-Dec-11 (367,316) 2-Dec-11 (3,301,083) 5-Dec-11 (14,284,034) 6-Dec-11 (9,570,631) 7-Dec-11 (23,779,314) 8-Dec-11 (24,143,117) 9-Dec-11 (21,773,922) 12-Dec-11 (22,074,929) 13-Dec-11 (20,745,933) 14-Dec-11 (11,962,537) 15-Dec-11 (4,152,261) 19-Dec-11 (7,658,027) 20-Dec-11 (6,124,015) 21-Dec-11 (8,320,596) 22-Dec-11 (19,161,609) 23-Dec-11 (15,145,716) 28-Dec-11 (13,781,749) 29-Dec-11 (14,519,717) 30-Dec-11 (10,584,404)

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7. PERFORMANCE ON MAIN TARIFF REVENUE COLLECTION

7.1 Collection rates as at 31st December 2011 The following is a summary of the year to date collection rate as at December 2011 Table 12: Collection rates to 31st December 2011 Main Tariff

Amount Billed For the year to

date

Amount received for the year to date

Collection Rate (received/billed) For the year to

date %

Property Rates 120,805,296.56 126,166,887.23 104.44 Electricity services 309,683,061.67 281,633,400.30 90.94 Water services 77,857,856.26 68,129,156.54 87.50 Sanitation services 42,633,018.40 32,847,228.28 77.05 Refuse services 31,890,184.70 22,529,570.17 70.65 SUB TOTAL 582,869,417.59 531,306,242.52 91.15 Other income 16,091,759.88 7,844,507.34 48.75 TOTAL 598,961,177.47 539,150,749.86 90.01 7.1.1 The above table shows the amount billed and the amount of cash received for

each of the main tariffs. This is also shown graphically in Chart 1. 7.1.2 Other income related to debtors has been added to this monthly report. The totals

for the five main tariffs are thus stated separately as sub-totals.

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Chart 1: Collection Rates to 31st December 2011- by tariff

Table 13: Collection Rate to 31st December 2011 by Suburb (accumulated year to date)

Suburb

Amount Billed For the year to

date

R

Amount received For the year to

date

R


date %

Krugersdorp 442,907,469.36 437,776,362.35 98.84 Kagiso 37,576,783.63 16,854,632.75 44.85 Munsieville 6,966,864.20 2,588,340.76 37.15 Azaadville 18,225,193.30 17,819,691.46 97.78 Lusaka 6,738,699.48 1,773,513.53 26.32 Magaliesburg 14,372,430.68 8,119,526.52 56.49 A/H 8,629,621.16 7,377,901.26 85.50 Farms 52,951,225.41 39,678,437.20 74.93 Other 10,592,890.25 7,162,344.03 67.61 TOTAL 598,961,177.47 539,150,749.86 90.01 7.1.3. The tables and charts below show monthly Collection Rates analysed by suburb and by customer category.

33

Chart 2: Collection Rates for the year to 31st December 2011 – by Suburb

Table 14: Collection Rate to 31st December 2011 - by Customer (YTD)

Customer Group

Amount Billed For the year to date

R

Amount received For the year to date

R


date %

Domestic 343,187,097.07 306,968,085.96 89.45 Business 108,090,165.24 99,748,800.68 92.28 Industrial 120,864,232.40 113,173,415.78 93.64 Government 8,094,502.14 5,816,645.11 71.86 School 7,362,789.63 6,129,607.37 83.25 Church 11,362,390.99 7,314,194.96 64.37 TOTAL 598,961,177.47 539,150,749.86 90.01

34

Chart 3: Collection Rates for the year to 31st December 2011 – by customer (YTD)

7.2. COLLECTION RATE PERFORMANCE Table 15: Collection Rate comparative figures from 2005/06 onwards

2006/07 2007/08 2008/09 2009/10 2010/11

2011/12

Collection Rate for the months of December

84% 85% 91% 89% 96% 86%

Average Collection Rate for year to date

88% 93% 94% 78% 91% 91%

7.2.1 The Collection Rate for the period December 2011 is lower in comparison to the

previous years. Year-to-date is the same as previous year as shown in the table above.

35

7.3 OUTSTANDING DEBTORS (AMOUNTS OWED TO MCLM) Chart 4: Total Outstanding Debtors as at 31st December 2011

7.3.1 The current debt outstanding and owed to the municipality is R870.2 million. Of this

82 % is older than 30 days, as shown in chart 4 above. The detailed age analysis for total debtors is shown below in chart 5.

.

36

Chart 5: Age analysis of total outstanding debtors as at 31st December 2011

7.4 AGE ANALYSIS

MONTH BALANCE CURRENT 30 DAYS 60 DAYS 90 DAYS 120+ DAYS

JUL 2011 826,495,020 115,472,559 64,475,193 18,381,946 17,209,337 610,955,986

AUG 2011 816,462,937

110,771,413

55,054,111

30,184,739

13,817,067 606,635,605

SEPT 2011 846,824,317

112,550,120

67,892,555 27,955,337

27,108,913 611,317,391

OCT 2011 866,505,081 242,435,685 71,816,980 26,227,547 23,763,589 502,261,281

NOV 2011 852,689,335

102,409,903

189,159,246 31,169,201

21,277,145 508,673,838

DEC 2011 870,269,047

102,715,768

74,106,676

151,719,105

25,898,015 515,829,481

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CHART 6 AGE ANALYSIS YEAR TO DATE

7.5 MONTHLY INCOME VARIANCE ON CASH COLLECTION AS AT 31st DECEMBER 2011

JUL 11

AUG 2011 SEPT 2011 OCT 2011 NOV2011

Budgeted Income 96,222,997

96,222,997

96,222,997

96,222,997

96,222,997

96,222,997

Actual Billed

90,028,040

103,600,709.88

104,316,172

96,324,859.26

93,848,839

94,750,796

Variance 94% 107% 108% 100%

98%

98%

7 .6 MONTHLY PAYMENT COLLECTION RATES AS AT 31st DECEMBER 2011

JUL 11 AUG 2011 SEPT 2011 OKT 2011 NOV 2011 DEC 2011 Actual Billed

90,028,040

103,600,710 104,316,172

96,324,859.26

93,848,839

94,750,796

Actual income

82,794,506

90,923,824

99,978,105

81,528,938

94,245,553

81,835,316

Payment Level

92% 88% 96% 85%

100% 86%

38

Chart 7 Monthly payment collection rates

7.7 PERFORMANCE OF DEBT COLECTORS Table 16 Performance of debt collectors

COLLECTOR CONTROL ACC AMOUNT H/O COLLECTED CORRECTIONS/

INDIGENTS NEW OUTSTANDING AFTER H/O

REVCO 8170 90371 129,023,891 7,723,003 7,330,757 113,970,131

C02 8170 90372 129,291,788 6,955,505 20,109,615 102,226,668

MOODIE & ROBERTS 8170 90373 135,780,327 9,347,733 13,498,870 112,933,724

C04 8170 90374 139,155,018 12,907,999 20,805,710 105,441,309

CREDITWORX 8170 90375 105,676,349 467,197 -22,637,775 127,846,927

Truter, Crous & Wiggill 8170 90376 184,958 2,758 182,202

639,112,333 37,404,195 39,107,177 562,600,961

The above table indicates the performance of debt collectors to date. Approximately 5% of the debt has been collected to date.

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8. RECOMMENDATIONS

1. That the second quarter In Year Monitoring Report for the period 31st December 2011 be noted.

2. Expenditure be limited to urgent service delivery projects.

3. A date be set as a matter of urgency before the next Finance Portfolio Committee meeting for Administration to state how they will address the current cash flow situation.

2011/2012 in year financial monitoring report · 2011/2012 in year financial monitoring report ......

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