Accounting Standards BoardAnnual report

Presented by: Erna Swart

CEO

Overview• Performance• Financial performance• Cost containment• Strategy of the ASB 2015 - 2019• Letter dated 23 July 2014

Performance

Mandate of ASB• Promote transparency in and effective

financial management of REAL

• Set Standards of GRAP as required by financial management legislation

• Prepare and publish guidelines and directives

• Recommend implementation dates to MoF after Auditor-General consulted

Presidential outcomes

We contribute to the following:

9 – The achievement of a responsive, accountable, effective and efficient local government system

12 – An efficient and effective development oriented public service

• Influence development of international standards• Set Standards of GRAP • Facilitate the implementation of Standards of

GRAP• Monitor the application of Standards of GRAP• Realise the potential of our people • Communicate with our stakeholders• Manage ASB efficiently, effectively and

economically

Objectives

Entities applying GRAP• Parliament and (some) provincial legislatures;

• municipalities, municipal entities, any other entities under the ownership control of a municipality & boards, commissions, companies, corporations & funds

• national and provincial public entities

• constitutional institutions

• trading entities

• Public FET Colleges

Entities that need to adopt

• Some provincial legislatures

• National and provincial departments

• Transitional provisions and other transitional arrangements will need to be developed

• Use experience gained in IPSASB project

Influence development of international standards

• Member of IPSASB• Member of 4 international task based groups• Concurrent exposure of international exposure

drafts• Submitted 11 comment letters on international

exposure drafts• With SAICA commented on 4 more• Support to IPSASB secretariat on Project on First

Time Implementation

Set Standards of GRAP• Biannual improvements to GRAP

• Amendment to GRAP 23 – services in kind

• ED Accounting by Principals and Agents

• Standard on Statutory Receivables

• Standard on Service Concession Arrangements

• Interpretation on Service Concession Arrangements: Where a grantor controls a significant residual interest in an asset

Facilitate the implementation of Standards of GRAP

• Developed transitional provisions for:

– Statutory receivables

– Service concessions

– Changes in measurement bases following the adoption of GRAP

• GRAP reporting framework

• Developed Directives for implementation by SARS and FET colleges

Monitor the application of the Standards of GRAP

• First post-implementation review completed• Objective:

– To assess whether users of financial statements use the information in the financial statements

– To identify improvements based on user and preparer input

• Outcome: Several new projects added to ASB work programme for 2014/15

Monitor the application of the Standards of GRAP

• SCOA for municipalities

• Articles for E&Y(International), SAIGA, SAICA & IMFO

Realise the potential of our people

• Technical staff are all CA(SA)s

• Focus on staff development

• Coaching

• Retention of key staff

• 66% of costs are staff remuneration

Communicate with our stakeholders

• Newsletter

• Articles for journals

• Reached all nine provinces

• Reached users through the PIR

• Preparers in national departments are not participating

Manage the ASB in an efficient effective and economic way

• Good governance• Clean audit• Internal audit identifies some housekeeping

issues, but no significant issues:– Number of training days omitted from

quarterly report– Improvements needed to business continuity

plan & disaster recovery plan• Implementation of ICT policy framework

Financial performance

• Drivers of cost

• Summary of results

Cost drivers• 6 employees of which 4 are CA(SA)s• Continuous training• Remuneration increases can exceed CPI• Four board meetings per year with at least 3 technical

documents per meeting• Board members paid SAICA rates• Board members are also members of MANCO• Extensive stakeholder consultation • International involvement• Small office with very little flexible costs

Summarised results  2014

(R’000)2013

(R’000)Budget (R’000)

Transfer payment 9 951 9 096 11 200Other income 219 143 110Revenue 10 170 9 239 11 310Staff remuneration 6 675 6 275 7 421Board remuneration 306 461 620Travel 867 662 886Training 207 249 232Communication 84 74 154Printing & Publishing 111 102 111Administration 1 703 1 358 1 722Expenditure 9 954 9 697 11 147       

Cost containmentSince 2008– Renegotiated lease escalation from 10% pa to 8% pa– Renegotiated cost of all services

In 2014– Renegotiated lease escalation from 8% pa to 5.5% pa– SAICA pays travel cost for workshops done on their

behalf– Cancelled all subscriptions except use of IPSAS &

professional membership fees

Cost containment beyond 2014

• Proposed cut in transfer payment of R 438 000 for 2015/16 & R657 000 in 2016/17

• Can only accommodate if no training, travelling & printing is incurred

• Filled vacancy in September 2014

Strategy going forward

• Review legislative mandate

• Establish project group to identify barriers to GRAP implementation by National & Provincial Departments

• Business as usual

Letter dated 23 July 2014

• Mechanism to consult with Members of Parliament

• Clarification of mandate

• Capacity building by inclusion in relevant curricula of HEIs

Contact details

CEO: Erna Swart

Tel: (011) 697-0660

Fax: (011) 697-0666

Website: www.asb.co.za

Email: info@asb.co.za