annual report 2016-2017 · annua reort 2016-2017 south african board of sheriffs honourable...

ANNUAL REPORT

DOING THE RIGHT THING AND DOING THINGS RIGHT.

2016-2017

South AfricAn BoArd for SheriffS88 Loop Street, Cape Town, 8001

PO Box 15223, Vlaeberg, 8018

T: 021 426 0577 | F: 021 426 2598

E: [email protected]

www.sheriffs.org.za

SABfS fraud hotline: 0800 000 628

iANNUAL REPORT 2016-2017

SOUTH AFRICAN BOARD OF SHERIFFS

Honourable Minister and deputy Minister, it is witH pleasure tHat we present to you, tHe annual report of tHe soutH african board for sHeriffs for tHe period 1 MarcH 2016 to 28 february 2017.

Mr J Jeffery, Deputy Minister of Justice and Constitutional Development with Mrs C Mabuza, Chairperson of the SABFS.

Adv M Masutha, Minister of Justice and Correctional Services with Mrs C Mabuza, Chairperson of the SABFS.


Contents

PArt A: GenerAL inforMAtion 1 1. Strategic Overview 2

2. Core Business 2

3. Governance and Legislative Mandates 2

4. Governance Structure 4

5. Chairperson’s Report 6

6. Executive Manager’s Report 9

PArt B: GoVernAnce 111. Sound Governance at SABFS 12

2. Audit and Risk Committee Report 13

PArt c: PerforMAnce inforMAtion 151. Statement of Responsibility for Performance Information 16

2. Overview of Organisation’s Performance 16

PArt d: huMAn reSource MAnAGeMent 291. Organisational Structure 30

2. Human Resource Oversight Statistics 31

PArt e: finAnciAL inforMAtion 341. Audited Financial Statements of the SABFS 35

2. Audited Financial Statements of the Fidelity Fund 64


As we all know, sheriffs are an essential part of the justice system. Without a proper and professional sheriffs’ profession, our civil justice system simply cannot function.

– Hon John Jeffery, MP

GENERAL INFORMATIONPART A

2ANNUAL REPORT 2016-2017


1. strategiC overview Vision• We are a Board that is transparent and responsive to the

needs of the sheriffs’ profession.

• We will promote a professional sheriffs’ service that is

respectful and efficient to deliver justice to all with integrity

and accountability.

• We will be accountable in terms of our legislative mandate

and strive to entrench the human rights culture envisaged

by the Constitution.

Mission • We will provide a professional and credible service to all

our clients and other stakeholders.

• We will develop skilled, knowledgeable and motivated staff.

• We will develop a unified and committed Board with

focused leadership.

• We will conduct all activities and execute our mandate

in a manner that is accountable to the public and to

government.

• We will enhance the image and goodwill of the sheriffs’

profession.

Core Values• Accountability

• Integrity

• Professionalism

• Transparency

• Efficiency

• Respect

• Equity

Strategic ObjectivesThe Board has adopted a Strategic Plan for the 3-year period of

2015 to 2018. Management is charged with operationalising the

plan and reporting quarterly on the performance achievements

on the stated objectives. These objectives are:

1. Compliance

To enforce compliance with the Sheriffs’ Act and subordinate

legislation governing sheriffs.

2. Fidelity Fund

To increase the financial performance of the Fidelity Fund

through effective management thereof.

3. Sustainability of the sheriffs’ profession

To improve the financial sustainability of the sheriffs’

profession.

4. Enhancing the sheriffs’ profession

To build capacity and professionalise the sheriffs’ profession.

5. Governance and corporate support services

To improve compliance with legal requirements and good

governance principles to increase stakeholder trust.

2. Core BusinessThe core business of the South African Board for Sheriffs is:

• To transform the sheriffs’ profession, the SA Board

for Sheriffs and its staff and to bring it in line with

constitutional imperatives.

• To review legislation and all other relevant legislation,

among others the Sheriffs Act 90 of 1986, and if necessary

lobby for reform in a manner which protects the interests

of the sheriffs’ profession and all stakeholders.

• To communicate effectively with all stakeholders and

sheriffs.

• To discipline sheriffs.

• To monitor the conduct of sheriffs.

• To promote professionalism.

• To set standards for training of persons who are, or intend

participating in the sheriffs’ profession.

• To set up the necessary training programmes.

• To formulate policy directives.

• To ensure effective management of the Board and its

office.

3. governanCe and LegisLative Mandates

The South African Board for Sheriffs (SABFS) is a regulatory

statutory body established by the Minister in terms of Section 7

of the Sheriffs Act No 90 of 1986 (Sheriffs Act), and it has as its

objectives the maintenance of the esteem of, the enhancement

of the status of, and the improvement of the standard of training

of and functions performed by sheriffs.

Legislation affecting sheriffs is constantly changing and the

SABFS spends a significant amount of time, effort and money

in monitoring and reviewing these. Where necessary the Board

employs the services of external legal experts to formulate

opinions and assist with drafting recommendations to forward

to the Minister and Rules Board.



The following table is a summary of the legislation reviewed in the period under review:

ACT/OTHER MANDATE DOCUMENTS PURPOSE OF THE ACT/OTHER MANDATE

Constitution and the Bill of Rights

(1996)

The Constitution provides an institutional framework for the SABFS to regulate the sheriffs’

profession in line with human rights for all.

Sheriffs Act (Act 90 of 1986) The Sheriffs Act guides the Board and sheriffs in respect of its rules and regulations.

Magistrates Court Act (Act 32 of 1944) The Act deals with general directives to a sheriff and his or her duties.

High Court Act (Act 59 of 1959) The High Court Act deals with general directives to a sheriff and his or her duties.

Rules Board for Courts of Law Act

(1985)

Members of the Rules Board for Courts of Law are appointed by the Minister and are

responsible for court rules.

The Public Finance Management Act,

(PFMA) (1999 (as amended))

Seeks to regulate financial management in the national government and provincial

governments. The SABFS has voluntarily chosen to comply with most of the provisions of

the PFMA and these are detailed in our policies.

Code of Conduct for Sheriffs The Code of Conduct seeks to regulate the manner in which sheriffs perform their functions

to ensure that they are aware of their role within the justice system of South Africa.

King III The principles of King III are used by the Board to apply three key elements, namely,

leadership, sustainability and good corporate governance.

Annual Performance Plan Our annual performance plan contains the SABFS performance targets, commitments and

measurement framework for the period under review.



4. governanCe struCtureGovernance Structure – 28 February 2017

THE BOARD

EXCO

FIDELITY FUND

COMMITTEE

FINANCE COMMITTEE

COMPLAINTS COMMITTEE

LEGAL AND LIAISON

COMMITTEE

HR AND TRAINING

COMMITTEE

AUDIT AND RISK

COMMITTEE

FINANCE COMMITTEE COMPLAINTS COMMITTEE

• Ms K Sigenu – Chairperson

• Mrs P Roodt – Member

• Mr L Mashapa – Member

• Mr I Klynsmith – Chairperson

• Mr T Tembe – Member

• Ms NV Soga – Member

FIDELITY FUND COMMITTEE HR AND TRAINING COMMITTEE

• Mrs P Roodt – Chairperson

• Ms M Lephadi – Member

• Mr I Klynsmith – Member

• Mr L Mashapa – Member

• Mr M Magida – Chairperson

• Adv H Mohamed – Ex officio

• Prof L Fernandez – Member

• Ms NV Soga – Member

AUDIT AND RISK COMMITTEE LEGAL AND LIAISON COMMITTEE

• Mr G Cronje – Independent Chairperson

• Mr I Klynsmith – Member

• Mr M Magida – Member

• Mr T Tembe – Chairperson

• Ms M Lephadi – Member

• Mr M Magida – Member

• Prof L Fernandez – Member

EXECUTIVE COMMITTEE

• Mrs C Mabuza – Chairperson SABFS

• Adv H Mohamed – Deputy Chairperson

• Ms K Sigenu – Chairperson Finance Committee

• Mrs P Roodt – Chairperson Fidelity Fund Committee

• Mr T Tembe – Chairperson Legal and Liaison Committee

• Mr M Magida – Chairperson HR and Training Committee

• Mr I Klynsmith – Chairperson Complaints Committee


SOUTH AFRiCAN BOARD OF SHERiFFS

MRS C MABUzAChairperson

MS K SIGENUChairperson

Finance

MR M MAGIDAChairperson

HR and Training

MS M LEPHADI MS NV SOGA MR L MASHAPA PROF L FERNANDEz

MR T TEMBEChairperson

Legal and Liaison

MR I KLYNSMITHChairperson Complaints

MRS P ROODTChairperson Fidelity Fund

ADV H MOHAMEDDeputy Chairperson

The current Board was appointed by the Minister of Justice and Correctional Services on 1 March 2015 for a period of 3 years. (2018)



5. CHairPerson’s rePort

The sheriff is likely the most feared professional, often

wrongly imputed with having unfettered discretionary

powers to make people homeless, take away their

belongings and throw them out in the street. In this financial

year, the Board employed several stratagems to change these

negative perceptions about the sheriff.

One of our core values is professionalism, and for us this means

that the sheriffs are viewed as skilled and knowledgeable

professionals, who are reliable and keep their promises.

Professionals display qualities such as honesty and integrity.

The sheriff must be trusted implicitly to do the right thing, even if

it is the most difficult path on the day.

The SABFS has made great inroads into achieving our vision

which is to promote a professional sheriffs’ service that is

respectful and efficient to deliver justice to all with integrity and

accountability. With this in mind, we have chosen the theme

for our annual report ‘doing the right thing and doing things

right.’

SABFS Strategy

The Board reviewed our Strategic Plan which was crafted after

extensive stakeholder consultation at the beginning of the

Board’s term. As a result, there is a high degree of ownership

and commitment to the strategy by industry. The strategy

remains responsive to key priorities within the sector and the

Board regularly reports to our stakeholders on the progress of

achieving our targets.

The SABFS’s strategy is aligned with government strategic

objectives set out in the Medium Term Strategic Framework

(MTSF), as well as the strategy of the Department of Justice and

Constitutional Development (DoJCD).

Transformation of the Sheriffs’ Profession

As at the end of the financial year, we had 285 appointed sheriffs.

In terms of demographics, 41% are White, 39% African, 12%

Coloured and 8% Indian. Women had a 26% representation.

Charmaine mabuza | CHairPerson of tHe saBfs | 30 June 2017

Demographics of sheriffs 28.02.2017

8%

12%

39%

41%

White African Coloured Indian



As at year end there were 696 deputy sheriffs who were appointed

by the Board. Only 20% of deputy sheriffs are women. In terms

of demographics, 43% are White, 36% African, 14% Coloured

and 7% Indian.

Rules Board RepresentationThe Board is represented on the Cost Committee of the Rules

Board and has received advice that the Board will be considered

for representation should a suitable vacancy arise on the Rules

Board. The SABFS consulted with the 2 representative bodies of

the profession, SASS and SANAPS, and made joint submissions

to the Rules Board. I would like to thank the members of the

Ad hoc Committee who gave up their time to prepare these

submissions on behalf of the profession.

Unclaimed Trust MoneyThe Board has made a proposal for legislative amendments

which would see the Board managing any unclaimed trust

funds, which traditionally were retained by sheriffs in their trust

accounts. Recently the Judicial Amendment Bill was released

for comment, and the amendments proposed support the

Board’s proposal that these funds be paid over to the Board for

management thereof.

The SABFS has a project plan in place to give effect to this

imminent change in legislation. An audit is underway on

unclaimed funds and in this regard, the Board is relying on the

full cooperation of the profession to complete their information

correctly.

The intention of the SABFS and the Department of Justice and

Constitutional Development is to utilise the unclaimed trust

money to the benefit of indigent members of the public who

utilise the services of the Small Claims Court. The SABFS will

cover the cost of execution that is normally paid to the sheriff to

enforce the judgment of the Small Claims Court.

Continuing Professional DevelopmentAnnually, the Board conducts Needs Based Training which

serves as informal continuous professional development for

sheriffs. This training was conducted around the country and

was attended by 264 sheriffs, deputy sheriffs and office staff.

The Board focused on two priority areas which were evictions

and the management of trust accounts. Sheriffs benefited from

receiving input from a panel of experts in interactive sessions

about evictions.

Risk-based inspection ModelThe Board introduced a risk-based Inspection Model in the

previous period, which is reaping results. Many desktop

inspections were carried out, making use of risk stratification

to identify and predict high risk sheriff offices to target for on-

site inspections. The Board’s inspection teams were beefed up

with the requisite financial skills to enable them to detect any

financial irregularities in the trust accounts. This has resulted

in the identification of a number of serious irregularities in the

trust account such as the rolling of trust money; investments of

trust money in irregular investment vehicles; using trust money

for business and personal expenditure; and non-disclosure of

investment interest.

Fidelity FundAlthough the Fidelity Fund is a Fund of last resort, it is important that

it is healthy to ensure that the public has faith in entrusting moneys

in trust with sheriffs. Through prudent management, the value of

the Fidelity Fund was increased by almost 10% over the financial

period. The Fund is now valued at R138.6 million (2015.16: R 126.5

million). The Board received 71 new claims during the period and

approved claims to the value of R3.09 million.

Of concern to the Board, is the high number of claims received,

which involved less than a handful of sheriffs who were rolling trust

moneys over extended periods without detection by their auditors.

Any auditor involved in unprofessional conduct will be referred

to the IRBA for investigation. The Board has resolved to pursue

criminal charges against sheriffs in all instances of theft of trust

moneys, the detail of which can be found in Part C of this report.

Gender breakdown of deputy sheriffs 28.02.2017

FemalesMales

80%

20%



Disciplinary MattersThe Board received 257 formal complaints against sheriffs and

we resolved or closed 171 during this financial period. This

represents a closure rate of 66.5%. A total of 772 informal

complaints were received and the divisional staff resolved 551

of them for the period.

The Board finalised 10 disciplinary hearings whereby 8 sheriffs

and 1 deputy were found guilty of various charges. When a

hearing is scheduled multiple complaints are dealt with, and 117

complaint files were finalised in these hearings. The Chairpersons

are independent legally qualified persons.

The Board finalised 3 appeals in the reporting period. A schedule

of disciplinary outcomes is included in Part C of this report.

Acknowledgement This is the second year with my fellow Board members and I

thank them for their support and commitment throughout the

year. To Deputy Minister, Mr John Jeffery, we appreciate your

open-door policy and the hands-on approach which we have

come to rely on from you. We had robust engagements with our

stakeholders, which have had many positive outcomes for the

profession, for which we are grateful. Lastly, to Sharon Snell

and the management team - thank you for breathing life into the

Board’s strategy. Congratulations on a job well done.

CHARMAINE MABUzAChairperson of the SABFS30 June 2017



6. exeCutive Manager’s rePort

This reporting period is the second year of our three-year

strategy (2015-2018) which is aligned to the term of office

of the Board. I am pleased to report that our results show

that our performance numbers at an aggregated level have

increased from the previous period.

Financial ManagementThe external auditors gave both the SABFS and the Fidelity

Fund another unqualified and clean audit report for the period.

We are very proud of this achievement which is a clear signal to

stakeholders that the financial management is sound and the

Board has complied fully with legislation and good governance

precepts.

Revenue exceeded budget by 6.6%. Levy payments and

administrative fees were the main sources of funding for the

SABFS. The total revenue collected was R19.1 million (2015.16:

R 16.6 million). Operating expenditure was reduced from the

previous period amounting to R15.02 million (2015.16: R16.3).

This resulted in a surplus of R4.07 million (2015.16: R 209.9K).

This 8.8% reduction in expenditure was a direct result of austerity

measures put in place by management to curb expenditure.

Growth of the Fidelity FundThe value of the Fidelity Fund now stands at R138.6 million

(2016.17: R126.5 million). Interest earned on investments

was R10.2 million (2015.16: R7.36 million). The Fidelity Fund

Committee of the Board oversees the management of the Fund.

The Board has an Investment Policy in place which provides for

investment in the four major banks.

Tax Clearance CertificatesIn 2016, it was identified that many sheriffs were experiencing

problems with SARS and as a result were not receiving their

payments from government departments. The SABFS worked

closely with the DoJCD to identify the sheriffs that did not have

tax clearance certificates and implemented a support project.

The Deputy Minister issued a circular, assisting the sheriffs to get

paid and providing them with a period to become tax compliant.

37 sheriffs were referred to the Board and the Board could assist

25 of them to become tax compliant as at year end.

In addition, the Board through the Consultative Forum met with

SARS to discuss various challenges that sheriffs experience

with their taxes, which hamper service delivery. The Board also

engaged with the Legal Aid Board in respect of sheriffs’ unpaid

fees and it was agreed that the parties would work towards

getting all sheriffs registered on the Central Supplier Database,

to speed up payment of fees.

sharon snell | exeCutive Manager | 30 June 2017

“Justice consists not in being neutral between right and wrong, but in finding out the

right and upholding it, wherever found, against the wrong.” – Theodore Roosevelt



Engaging with the Media For the sheriffs to be viewed as professionals by the public, it

is important that a consistent message on the role of the sheriff

is presented and that the Board engages with the public on the

role of the sheriff. The Board was concerned about the number

of media articles where the sheriff was quoted. The sheriffs

should refer media queries to the Board for handling. The Board

increased its footprint in the media, especially social media.

Other activities included an SABC radio campaign, attending

DoJCD exhibitions and promotional activities centred around

World Sheriff’s Day 2016.

Cost of Consultants and Technical AdvisorsThe Board employed the following consultants during the period under review.

CONSULTANTS AND TECHNICAL ADVISORS SERVICE COST FOR 2016/17

COST FOR 2015/16

SNG Auditors Provide outsourced External auditors 91 885 88 972

Hugo and Ngwenya Attorneys Provide outsourced Legal services 145 402 167 605

KPMG Provide outsourced VAT Ruling 55 814 127 566

TNK Attorneys Provide outsourced Legal services 426 308 280 787

Nongogo Nuku Inc. Provide outsourced Legal services 272 640 236 540

J Tarica Attorneys Provide outsourced Legal services 29 355 213 257

Herold Gie Provide outsourced Legal services 125 801

PWC Provide outsourced for Training Strategy - 291 181

Motimele Masete Inc. Provide outsourced Legal services 143 313 -

Mediate Works Inc. Provide outsourced Legal services 30 079 -

Ngcingwana Inc. Provide outsourced Legal services 76 827 76 827

Edward Nathan Sonnenberg Inc. Provide outsourced Legal services 87 096 87 096

TOTALS 1 484 520 1 569 831

Criminal CasesThe Board has taken a decision to lodge criminal charges against sheriffs who misappropriate trust money. Below are matters handled

during the period under review

NO SHERIFF STATUS

1 Ms L Gertze – Previous Sheriff for Bredasdorp HL SAPS Investigation, matter remanded for regional court.

2 Ms Seti – Previous Sheriff for Alberton HL SAPS Investigation pending

3 Mr R Simelane – Previous Sheriff for Sasolburg HL SAPS Investigation pending

Civil CasesFrom time to time the Board is required to institute civil action to interdict a sheriff from dealing with his trust account to protect the

interest of the public. Interdicts were finalised in the matters listed below:

SHERIFF STATUS CASE NUMBER

Mr Maqokolo (Mthatha L) Sheriff interdicted from using his trust account. 2457/2016

Mr Mohlomonyane (Sekhukhune L) Sheriff interdicted from using his trust account. 3804/2016

Ms N Seti (Alberton) Third party interdicted the sheriff from using her trust account. 30422/2016

AppreciationFirstly, I would like to extend my appreciation to Charmaine

Mabuza for her steady guidance and the unwavering support

of the Board throughout the year. The Board’s Legal Manager

relocated during the period and the position remained vacant,

putting strain on an overloaded system. I came to rely on the

Complaints Committee during the period, who were always

a phone call away, to provide much needed support. The

performance that we have achieved during this year would not

have been possible without the support and hard work of the

loyal managers and staff of the Board.

SHARON SNELLExecutive Manager30 June 2017


GOVERNANCEPART B

The Board has adopted a zero tolerance approach to the theft of trust moneys or misconduct of any kind by sheriffs, and will use all legal remedies available to protect the interest of the public as well as the profession.

– Charmaine Mabuza



1. sound CorPorate governanCe

The Board aspires to retain the trust that stakeholders

place in the SABFS by ensuring that sound governance

principles are embedded into the culture of the

organisation and we display excellence in performance and

integrity. Corporate governance will facilitate fairness,

accountability, responsibility and transparency across the

organisation. From a governance perspective, the overall

intention of the SABFS is to ensure continuous performance

improvement and adherence to all legislative requirements.

The Board has approved a Board Governance Framework

and other corporate governance processes which protect the

Board, executives and employees in carrying out their duties

and responsibilities and also instils stakeholder confidence.

The Board of Directors is also assisted by the framework and

processes to fulfil their fiduciary role towards the SABFS. The

SABFS has been created in terms of the Sheriffs Act and is a

public body which exercises public functions as set out in the

Sheriffs Act and supporting legislation. The Board appreciates

that corporate governance practices must be appropriate and

relevant given the size, nature and complexity of the SABFS.

Risk ManagementThe Board is responsible for the governance of risk and to

ensure that there is an appropriate framework, policy and

BOARD EXEC L&L HR, T&C

FIN CONS. FORUM

CC FF AUDIT & RISK

TELE-CON

OTHER TOTAL REMUNERA-TION

DISBURSE-MENTS

C Mabuza 5 2 1 1 11 6 26 58 368 54 289

H Mohamed** 4 1 5 N/A -

P Roodt 5 2 3 0 4 1 9 5 29 84 120 6 096

T Tembe 4 2 3 3 3 9 2 26 84 784 8 125

N Soga 5 3 0 3 3 2 16 52 200 3 739

K Sigune 5 1 3 1 1 11 52 736 11 593

M Magida 5 2 1 3 0 2 5 2 20 93 184 1 399

M Lephadi 5 3 0 4 6 3 21 56 520 7 636

LD Fernandez

5 3 2 2 1 13 48 960 458

L Mashapa 3 2 4 9 - 1 800

I Klynsmith 5 2 0 3 4 3 10 4 31 81 064 32 651

G Cronje* 3 3 41 090 -

653 026 127 786

* Independent Chairperson of the Audit Committee.

** Adv. H Mohamed is the Regional Head of the Department of Justice and Constitutional Development in the Western Cape and, as a Government employee is not eligible to claim meeting allowances.

process. The SABFS’s risk management system consists of

a Risk Management Framework, a Risk Policy and a Terms of

Reference for the Risk Management Committee. Together these

contain the policies, strategies, processes, procedures and tools

for identifying, measuring, monitoring, managing and reporting

all material risks to which the SABFS is exposed. The Enterprise

Wide Risk Management (ERM) Framework contains the key

principles that guide the implementation of risk at all levels. It

provided the risk architecture and shows how risk management

should be embedded in all business units to ensure that the

effective risk management strategies are integrated in all work

contexts.

Risk Management is being made part of the culture of the SABFS

and is embedded in daily practises and processes. There is a

direct focus on the relationship between the risk and its impact

of achieving the objectives set out in the SABFS’s strategy.

Conflict of InterestThe SABFS recognises that in exercising their powers and functions,

Board members or officials may become conflicted. There are

proper structures in place for annual declarations of interest and

all decision-making structures and official meetings provide for

declaration of interest. Members who become conflicted do not

participate in decision-making and other activities.



2. audit and risK CoMMittee rePort to tHe Board

The Audit & Risk Committee of the SABFS has been

established as an independent committee of the Board in

the previous reporting period. The committee is governed

by a charter which contains its formal terms of reference.

We hereby present our report for the financial year ended

28 February 2017.

Audit Committee Members and AttendanceThe committee’s terms of reference require a minimum of four

independent members, and consists of the members listed

below. During the period under review, three Audit Committee

meetings and two special meetings were held.

The Auditor-General is invited to the Audit Committee meetings,

but they have not attended any meetings for the period.

Both Mrs Mabuza and Adv Mohamed are not members of

the committee and are invited to attend as Chair and Deputy

Chairperson of the Board, respectively.

NAME OF MEMBER NO. OF MEETINGS ATTENDED

Mr G Cronje 5 of 5

Ms K Sigenu 5 of 5

Mr I Klynsmith 4 of 5

Mr M Magida 4 of 5

Audit Committee Responsibility The Committee reports that it has, as far as possible, complied

with its responsibilities arising from its terms of reference,

including relevant legislative requirements.

The Audit Committee has compiled an annual work plan that

assists in carrying out its responsibilities. Quarterly reporting

on the activities of the Audit Committee was presented to the

Board.

Review and Evaluation of the Annual Financial Statement for the SABFS and Fidelity Fund

The Committee has:

• Reviewed and discussed the annual financial statements of

the SABFS and the Fidelity Fund with the SNG Auditors and

management, which are to be included in the Annual Report;

• Reviewed the Auditors management letters and

management’s responses thereto;

• Reviewed and discussed the report and audit opinion of

the Auditor with the Auditor and management;

• Reviewed changes in accounting policies and practices;

and

• Reviewed the SABFS compliance with legal and regulatory

provisions.

The Committee is extremely pleased that the Auditor has issued

an unqualified audit opinion on both the SABFS and the Fidelity

Fund financial statements, for the year ended 28 February 2017.

The Committee concurs and accepts the Auditor’s opinion

regarding the annual financial statements, and proposes that

the audited annual financial statements be accepted and read

together with the Auditor’s Report.

The financial statements are prepared in accordance with the

South African Standards of Generally Recognised Accounting

Practice, and in the manner required by the PFMA.

Efficiency and Effectiveness of Internal ControlThe SABFS does not have an internal audit function, due to

the size of the organisation and the lack of budget. The DoJCD

was approached to assist with some internal assurance and the

committee will explore this option in the new financial year in

accordance with our Combined Assurance Plan.

Performance ManagementThe Audit Committee oversees the performance reporting

towards strategic objectives of the SABFS. The committee

has reviewed and considered the Performance Reports as

prepared by management and recommend same to the Board

for approval.

Risk ManagementThe SABFS has introduced enterprise wide risk management

in the period and the committee oversaw the activities of the

SABFS Risk Management Committee. In our view, the SABFS

has made good progress in embedding risk management

processes in its operations and strategy.



GovernanceThe Board has formally adopted the principles of the King 3

report on corporate governance. The Committee continues to

monitor key SABFS governance interventions. The Committee

continues to review the development of the SABFS Combined

Assurance Plan to ensure that all significant risks are addressed

to the satisfaction of the Board.

ConclusionThe Committee is very pleased with the progress made by the

SABFS during the financial year, in all the areas outlined in this

report.

The Committee wishes to express its appreciation to the

management of the SABFS and the external auditors SNG

Auditors who enabled the committee to perform its function as

set out in the Audit Charter.

GREGORY CRONjEIndependent Chairperson of the Audit & Risk Committee30 June 2017


PERFORMANCE INFORMATION

In as much as the success of the office of a sheriff is based on sound business principles and systems, the sheriff is constitutionally bound to adhere to and give effect to the Bill of Rights in the execution of their duties.

– Adv Hishaam Mohamed

PART C



1. stateMent of resPonsiBiLitY Statement of Responsibility for Performance Information of the year ended 28 February 2017

2. overview of organisation’s PerforManCe

The Executive Manager is responsible for the preparation

of the entity’s performance information and for the

judgements made in this information.

The Executive Manager is responsible for establishing and

implementing a system of controls designed to provide

reasonable assurance as to the integrity and reliability of

performance information.

In my opinion, the performance information fairly reflects the

actual achievements against planned objectives, indicators and

targets as per the strategic and annual performance plan of the

SABFS for the financial year ended 28 February 2017.

The performance information of the SABFS is set out in Part C of

the Annual Report and was approved by the Board.

SHARON SNELLExecutive Manager

2.1 Service Delivery EnvironmentSheriffs are appointed by the Minister of Justice and Correctional

Services until their retirement age of 65 years. Sheriffs are

impartial officers of the law who perform their functions as set

out in various pieces of legislation, including the Supreme Court

Act and the Magistrates Court Act, along with the respective set

of Rules for each.

The SABFS encourages sheriffs to perform their duties in line

with the Code of Conduct and Pledge for sheriffs and to uphold

the dignity of those they serve.

The SABFS’s primary function is one of exercising oversight

of the sheriffs’ profession: ensuring that their duties and

responsibilities are completed in the prescribed manner, and

dealing with complaints when this does not occur. At the heart

of this function is the SABFS’s authority to issue or withhold

the Fidelity Fund Certificate. In order for a sheriff to receive this

document there are a number of conditions that have to be met,

and without this document a sheriff is prohibited from operating.

Noting that the SABFS does not receive any grants from

government and is totally reliant on the annual levies that it

receives from sheriffs and the administrative fee it gets for

managing the Fidelity Fund for sheriffs, it does remarkably well

to promote and regulate the profession.

The SABFS also has a twofold responsibility in respect of

regulating the sheriffs’ profession and managing a staff

complement that provides it with an administrative function.

Further to this, the Board interacts with various stakeholders

to forge strategic partnerships to enhance and maintain

its relevance in its statutory sphere. It participates in and

contributes to a number of government-related initiatives as

well as advancing the sheriffs’ profession by implementing

developmental projects.

2.2 Strategic Outcome Oriented GoalsBelow is qualitative information on the performance towards

stated objectives.

» ProGrAMMe 1: complianceThe goal of this programme is to enforce compliance with the

Sheriffs Act and subordinate legislation governing sheriffs. This

is performed through regulating and promoting the standard of

conduct of sheriffs and deputy sheriffs having due regard to the

interest of the public.

complaints Against Sheriffs and deputy SheriffsFormal complaints are received in the form of an affidavit. Where

the matter is not serious and can be resolved inter partes, these

are dealt with initially as informal complaints.

A total of 257 complaints have been received to date and 171

complaints have been closed.

FORMAL COMPLAINTS RESOLVED 16.17NO OF COMPLAINTS

RECEIVEDNO OF COMPLAINTS

CLOSED257 171

RESOLUTION RATE 66.5%



Informal complaints are dealt with by the division either

telephonically or in writing.

When an informal complaint is serious and needs to be escalated,

the complainant is required to submit an affidavit. A total of 772

queries have been received to date and 551 have been resolved.

The balance is pending resolution, or have been handed over to

be handled as a formal complaint and appear in those statistics.

Note there is always an overlap between the period during which

the query was received and when it was resolved. Not all queries

are resolved in the same month that they are dealt with.

Ideally an informal complaint should be resolved immediately or

where engagement is needed, a maximum period of 90 days.

INFORMAL COMPLAINTS RESOLVED 16/17

NO OF INFORMAL COMPLAINTS RECEIVED

NO OF INFORMAL COMPLAINTS CLOSED

772 551

RESOLUTION RATE 71.3%

disciplinary hearingsCharges are proffered against sheriffs once the Board is satisfied

that there is a prima facie case of misconduct. Typically, a charge

against one sheriff will contain more than one complaint. To date

charges have been proffered against 18 sheriffs and 1 deputy

sheriff. The total number of complaint files that these charges

relate to is 113.

CHARGES PROFFERED AGAINST SHERIFFS 16/17

NO OF COMPLAINTS

ESCALATED TO CHARGES

NO OF SHERIFFS CHARGED

NO OF DEPUTY SHERIFFS CHARGED

113 18 1

disciplinary hearings that were finalisedThe biggest challenge that the Board faced was that although

there were many disciplinary hearings scheduled in the year,

a large number of them were postponed at the request of

the sheriff. 10 disciplinary hearings were finalised whereby 9

resulted in guilty findings and 1 was not proceeded with on the

day because the sheriff had resolved the complaints with the

complainants to their satisfaction. The sheriff had also received

mentoring by a more experienced sheriff.

NAME OF SHERIFF NO OF COMPLAINTS DEALT PER SHERIFF

CHARGE SHEET

OUTCOME OF DISCIPLINARY ENQUIRY

NOT GUILTY GUILTY AND SENTENCE

Mr AN Mabindisa 30 Matter was concluded as the sheriff agreed to resign from the office of Kokstad HL.

Mr TF Seboka 1 Guilty, fined R25 000.00. An appeal was lodged on the sentence and the fine was reduced to R10 000.00.

Mr MP Phiri 2 Guilty, fined R125 000.00, fine paid in full by sheriff.

Mr BJ Mosikili 4 The hearing was postponed and scheduled to reconvene in January 2017.

Mr CA Botes 1 Sheriff found guilty. The Sheriff was fined R5000.00.

Mr Higgins 1 Deputy sheriff found guilty and fined R10 000.00.

Mrs Buys 11 Sheriff resolved complaints with complainants and matters withdrawn.

Mr Manyandi 23 The matter was concluded, the sheriff was fined R80 000.00.

Mr Maqokolo 40 Sheriff found guilty and the sentence was to recommend a removal. Sheriff resigned.

8 sheriffs 1 deputy sheriff 117 1 8



Appeals considered by the Board Four appeals against the findings of the Disciplinary Committee was lodged with the full Board and were finalised as follows:

No. SHERIFF STATUS

1 Mr Balfour Butterworth

The Board dismissed the Appeal.Sheriff Balfour has filed an external appeal to the High Court which is pending.

2 Ms Mabandla Kwa-bacha Mount Frere

Appeal dismissed and the sheriff has been removed from office. Letter of removal was forwarded to the Sheriff and the DM.

3 Mr SebokaPretoria Central

The sheriff appealed the sentence which was a fine. He was successful and the fine reduced to R15 000.

4 Mr Segwana Appeal date scheduled.

registration of Sheriffs and deputy SheriffsThe table below provides registration information and demographics for sheriffs as of 28 February 2017.

PROVINCE TOTAL GENDER RACE

MALE FEMALE WHITE AFRICAN INDIAN COLOURED

Eastern Cape 45 30 15 8 31 0 6

Free State 23 16 7 14 7 0 2

Gauteng 39 26 13 17 12 8 2

KwaZulu-Natal 33 24 9 9 13 11 0

Limpopo 24 18 6 7 17 0 0

Mpumalanga 23 17 6 13 10 0 0

North West 25 16 9 10 12 1 2

Northern Cape 13 10 3 7 1 1 4

Western Cape 43 32 11 17 7 3 16

Total 268 189 79 102 110 24 32

The table below provides registration information and demographics for deputy sheriffs as of 28 February 2017.

PROVINCE TOTAL GENDER RACE

MALE FEMALE WHITE AFRICAN INDIAN COLOURED

Eastern Cape 68 53 15 21 37 1 9

Free State 51 46 5 31 20 0 0

Gauteng 203 162 41 111 70 11 11

KwaZulu-Natal 97 78 19 25 36 34 2

Limpopo 45 37 8 18 27 0 0

Mpumalanga 44 33 11 22 21 0 1

North West 44 36 8 10 27 1 6

Northern Cape 19 14 5 11 1 0 7

Western Cape 125 97 28 50 12 4 59

Total 696 556 140 299 251 51 95



» ProGrAMMe 2: fidelity fund The goal of this programme is to increase the financial

performance of the Fidelity Fund through effective management

thereof. The SABFS has appointed a Fidelity Fund Committee to

oversee the activities of the Fund.

The Fidelity Fund was established in terms of Section 26 of the

Sheriffs Act and its primary function is to be used as a source of

revenue to compensate those who have suffered any prejudice

as a result of misconduct or omissions by a sheriff. The monies

accrued in the Fund are housed in various investments and the

capital is guaranteed with interest reinvested into the Fund.

Interest earned by sheriffs on their respective trust funds is

forwarded to the SABFS as a contribution to the Fidelity Fund.

claims against the fidelity fund

YEAR LODGED NO OF CLAIMS RECEIVED

TOTAL VALUE OF CLAIMS RECEIVED (R)

CUMULATIVE TOTAL VALUE CLAIMS STILL PENDING (R)

CUMULATIVE TOTAL VALUE CLAIMS APPROVED BUT NOT PAID (R)

TOTAL CLAIMS PAID (R)

TOTAL CLAIMS REjECTED (R)

2012/2013 9 490 073.93 12 833 023.99 0.00 1 142 527.29 0.00

2013/2014 18 7 358 148.16 7 654 490.00 932 082.16 6 398 892.34 6 137 788.95

2014/2015 23 3 274 821.42 5 479 591.93 641 422.16 1 859 169.49 3 590 550.00

2015/2016 13 3 487 330.58 8 668 136.33 1 553 700.68 559 673.93 1 515 471.00

2016/2017 71 15 584 513.73 19 536 712.17 1 358 860.68 2 000.00 1 560 058.10

Total (R) 134 30 194 887.82 N/A N/A 9 962 263.05 12 803 868.05

» ProGrAMMe 3: financial Sustainability of the Sheriff’s Profession

The goal of this programme is to improve the financial

sustainability of the Sheriff’s profession.

This is performed through:

1.1. Strategic and Financial Management to ensure that the

SABFS and industry are a going concern and there is

financial sustainability.

1.2. Stakeholder consultation through the Consultative Forum

to ensure that the Board is guided on the matters that affect

sheriffs.

1.3. Advocacy and lobbying work conducted on behalf of the

Sheriff’s profession.

Processes used to meet these objectives:

• Consultative Forum processes;

• Legal and Liaison committee functions;

• Engagement with key stakeholders and MOUs; and

• Use of legal consultants for legal opinions and position

papers.

consultative forumComprising members from the two sheriffs’ associations,

members of the Board, stakeholders from a broad range of

sectors, and assisted by management from the Board, the

Consultative Forum is a platform where a wide range of issues

affecting sheriffs are discussed.

The scope of the Forum includes:

• To consult and advise on legislative and policy matters

proposed by the Board, the two sheriffs’ organisations and

any other interested body;

• To ensure the inputs of the Sheriff’s profession are

discussed and debated;

• To consider input on transformation within the profession;

• To consult and engage on any matter affecting the

profession; and

• To forward the Forum’s recommendations to the Board for

consideration.

risksThe SABFS and the Fidelity Fund are constantly exposed to

various risks. These risks are therefore diligently managed by

the SABFS with the implementation of its risk policies. Risks are

also reported to the Audit and Risk Committee and all identified

risks are properly managed.



rcc Meetings In August 2014 the Department of Justice and Constitutional

Development and the South African Board for Sheriffs entered

into an agreement in which a task team led by retired Judge

Willem van der Merwe was established. The task team completed

its mandate on 31 March 2016.

The Final Report re: “Task team for the Description of Certain

Areas of Jurisdiction in Term of Section 3 of the Sheriffs Act,

1986”, dated 31 March 2016 submitted to the Deputy Minister

was inconclusive regarding various sheriff service areas affected

by the rationalised magisterial district in the Gauteng and North

West Provinces. The investigations also extended to vacant and/

or contentious sheriffs’ areas, nationally. The task team further

did not consider Limpopo and Mpumalanga Provinces as these

two provinces resorted outside its terms of reference.

Judge Van der Merwe in his final report therefore recommended

that a streamlined task team be appointed (preferably under

guidance of a retired magistrate who understand the sheriff’s

profession) to deal with the unfinalised sheriff areas. Currently,

there is very little data relating to maps and point-to-point

descriptions on the service areas of the sheriffs whether affected

by the rationalisation process or not. This process will assist the

department to develop a database of all sheriffs’ areas which will

be utilised for future sheriff’s appointments.

A new Memorandum of Understanding (MOU) outlines the terms,

collaboration and understanding between the Department of

Justice and Constitutional Development and the South African

Board for Sheriffs in order to:

a. Resolve the contentious areas causing uncertainty

and possible conflict between the affected Sheriffs by

conducting investigations on the areas of conflict;

b. Look at the recently proclaimed Magisterial District and

propose and recommend the alignment to the Jurisdiction

were possible; and

c. To consider the description and allocation of the sheriff

service areas.

The streamlined task team is appointed with a view to finalise

outstanding sheriffs’ service areas by undertaking the following:

a. Consult and investigate all affected areas with the sheriffs,

the Board and the other stakeholders;

b. Draw maps depicting the areas of operation for the sheriffs

taking into account the outcomes of the rationalisation of

the magisterial districts process where completed;

c. Draft point to point description for the sheriffs based on

the final maps;

d. Conduct an impact analysis of the rationalisation of the

magisterial districts on the sheriff service areas;

e. Make recommendations to the Minister on the resolutions;

and

f. Investigate and report on any other matter regarding the re-

description and allocation of the sheriffs’ areas as directed

by the Minister from time to time.

Procurement During the current year the SABFS has procured its goods and

services from suppliers who complied with the requirements

of the SABFS’s Supply Chain Management policy. This policy

has been in place for the last three years and is currently being

updated to ensure that it complies with changes in procurement

legislation.

fraud hotlineThe South African Board for Sheriffs established a Fraud

Hotline to help maintain the culture of ethical behaviour of

the organisation. The hotline is aimed at enhancing an honest

work ethic and simultaneously provide internal and external

stakeholders with a mechanism to bring any unethical business

practices to the attention of management.

The hotline can be used to report unethical behaviour, theft,

fraud and other related activities of staff and boards members

of the South African Board for Sheriffs by simply dialling this toll-

free number 0800 000 628 from a Telkom line.

Sheriffs tax compliance ProjectDuring the financial year, the SABFS and the Department

of Justice and Constitutional Development entered into a

Memorandum of Understanding to assist sheriffs with their tax

compliance. The project was aimed at ensuring that sheriffs are

timeously paid by the DoJCD. Since 1 April 2016, all service

providers who conduct business with Government had to be

registered on the National Supplier Database. This database is

managed by National Treasury. The SABFS was able to assist

26 of 38 sheriffs to become tax compliant. We were also able to

assist 30 sheriffs to register on the National Supplier Database.

Additionally, a number of sheriffs struggled to obtain their Tax

Clearance Certificates from SARS and through the Consultative

Forum, the Board communicated with various stakeholders in

the value chain and we sourced guidance for sheriffs.



Banking ProductsThe SABFS identified that the sustainability of the Fidelity Fund

would benefit if sheriffs are all able to earn the maximum amount

of interest that banks pay on the trust account. The SABFS has

contacted and met with the four major banks and are actively

involved in the process to ensure that the correct sheriff banking

products are made available to the profession. This is an ongoing

process and the banks have introduced separate products which

will ensure that sheriffs comply with the Sheriffs Act.

revenueThe SABFS does not receive any funding from the Department of

Justice and Constitutional Development. Revenue is generated

from the sheriff’s profession via a 1.5% levy on the gross income

of sheriffs. Further to the levy, an administration fee is received

from the Fidelity Fund and from other smaller revenue generation

services.

The Fidelity Fund generates its revenue from interest earned on

the trust accounts of sheriffs as well as from investment income

from the monies invested in line with the Sheriffs Act.

» ProGrAMMe 4: enhancing the Sheriff’s Profession

The goal of this programme is to build capacity and

professionalise the sheriffs’ profession.

This is performed by increasing stakeholder awareness of the

sheriff’s role, as well as public relations and marketing activities.


• Skills Development Research and Planning for the sheriff’s

profession.

• Implementing Training and Development Initiatives for

sheriffs and deputy sheriffs.

• Identifying gaps in knowledge and supporting sheriffs

through mentoring and coaching initiatives.

• Marketing activities conducted to enhance the reputation

of the sheriff’s profession and the SABFS.

Sheriff’s Guide: Practice and Procedure – updatesThe First Revision Service now contains the law up to 30

November 2016. It includes updates to chapters 1 to 5 of the

Original Service by incorporating the 2015 amendments to the

Sheriffs Act 90 of 1986 and the Regulations thereto, as amended.

In order to make the updated Guide available to all sheriffs with

an annual gross income of less than R 500 000.00, the Board

donated a Guide free of charge to 65 sheriffs’ offices.

World Sheriffs day For 2016, the theme of World Sheriff’s day was, “Restoration of

economic balance and insolvency proceedings: The Role of the

Sheriff”. It was celebrated on 9 June 2016.

The World Sheriffs Day celebrations was an opportunity to

demonstrate to litigants once again that the sheriff is an

essential element of the guarantee of their rights, including - and

especially - in times of crisis.

The SABFS visited the Athlone Magistrate’s Court and distributed

leaflets to the public. The following activities were initiated by

sheriffs around the country as part of World Sheriff’s Day:

• The Sheriff for Cape Town North donated food and winter

goodies to the Marconi Beam Primary school in Joe Slovo.

• The Sheriff for Cape Town East donated care packages to

a Rape Crisis Centre in Observatory.

• The Sheriff for Bellville North donated food items to the

sexual offences court in Parow.

• The Sheriff for Brits donated blankets to their community.

• The Sheriff for Port Elizabeth North hosted a soup kitchen

at the Motherwell Magistrate’s Court.

• The Sheriff for Durban South donated blankets and

groceries to a shelter for abused women and children.

• The Sheriff for Simonstown donated snuggle blankets to a

children’s home.

• The Sheriffs for Pietermaritzburg, Pinetown, Umbumbulu,

Durban Coastal and Howick visited homes for disabled

children and donated items to the children.

• The Sheriff for Strand celebrated World Sheriffs Day with

the elderly, playing bingo and providing them with eats.

• The Sheriff for Peddie visited the Ngqushwa Special

Needs Service Centre and donated groceries and fruit.

The SABFS would like

to thank all sheriffs’

offices who participated

in World Sheriff’s Day

and made a difference in

their communities.



Attendance at exhibitions and Stakeholder engagements

The SABFS participated in an anti-crime and service delivery

Imbizo in the community of Nyanga and surrounding areas. The

community had an opportunity to interact with the Minister of

Justice and Correctional Services, Adv. Michael Masutha during

the Imbizo.

The Minister reflected on various issues that affects the

community such as child maintenance, substance abuse and

crime. He outlined the government interventions which are in

place to address these issues.

outreach ProgammesThe 18th of July marks International Mandela Day, which is

recognised as a day of goodwill aimed at inspiring change for

the better.

In celebration of International Mandela Day, the SABFS donated

meal vouchers, cupcakes and sandwiches to the homeless in

the Cape Town central business district.

The SABFS staff initiated the idea of purchasing “U-turn”

vouchers for the homeless. These vouchers could be redeemed

at local shelters for a meal and an item of clothing. It was also

arranged that counselling services could be provided to help

with rehabilitating and assisting homeless people further.

The 16 Days of Activism for no violence against women and

children is an international campaign that raises awareness

about violence against women and children annually from 25

November, (International Day of No Violence against Women) to

10 December (International Human Rights Day).

The SABFS attended the Department of Justice and

Constitutional Development’s Women’s Day event in Piketberg

to raise awareness of the role of the sheriff and the SABFS.Minister of Justice and Correctional Services, Adv. Michael Masutha during an Imbizo.

SABFS staff giving out sandwiches to the needy.Women’s Day in Piketberg.



Ahead of Human Rights Day on 21 March, the Deputy

Chairperson of the SABFS, Adv Hishaam Mohamed, who

is also the Regional Head of the Department of Justice and

Constitutional Development in the Western Cape, delivered a

speech which reflects on our past and examines how far South

Africa has come in upholding and protecting the rights of all

South Africans and the role his Department plays in safeguarding

these rights.

In his speech, Adv Mohamed mentioned that, “South Africa

has come a long way towards the realisation of human rights,

with the stage set by the Constitution. These human rights

as entrenched in the Bill of Rights of our Constitution include

the right that everyone is equal before the law and has the

right to equal protection and benefit of the law, and the right

to be free from any form of unfair discrimination directly and

indirectly, whether on the basis of race, religion, conscience,

belief, culture, language, birth, gender, sex, pregnancy, marital

status, ethnic or social origin, colour, sexual orientation, age and

disability. The right to equality is one of our fundamental human

rights and the Promotion of Equality and Prevention of Unfair

Discrimination Act, 4 of 2000 (the Equality Act), breathes life into

this constitutional right.”

radio campaign – the role of the Sheriff in the eviction ProcessThe SABFS produced a voice clip advert for radio broadcast.

The purpose of the advert was to educate the public with regards

to the role of the sheriff in respect of evictions. The advert was

produced in 4 different languages i.e. English, Sotho, Xhosa

and Zulu and is between 30 to 35 seconds long. These adverts

were broadcast during February 2016 and the target audience

reached was all persons of the 15+ age group. The advert was

broadcast on the following radio stations and we reached a total

audience of 18 382 000.

Brand GuideThe SABFS conducted research to assess the status of signage

branding of the profession at the offices of sheriffs, with the

purpose of working towards standardising the branding of the

profession. The SABFS would like to thank the sheriffs who

participated in the survey and the outcomes thereof has led to

the development of a unified Brand Guide for Sheriffs.

training of Sheriffs and deputy Sheriffs WSP, Atr and SSPThe SABFS submits its WSP and ATR to the SASSETA each

year. Conforming to these criteria allows the Board to apply

for Discretionary Grant Funding for training, during specified

funding windows as determined by the Seta.

However, despite our annual submission to the SASSETA, the

SABFS has been unable to secure any funding from the statutory

body for three years. For this reason, the Board’s annual budget

for training has had to be increased drastically to cater for the

growing need of skills development in the profession.

Submitting a SSP to the SASSETA each year provides for the

identified needs of the sheriffs’ profession to be tabled and

considered to be included in the list of projects that are advertised

during funding windows. Unfortunately, our submissions have

been ignored by the SASSETA and our sector needs have not

been advertised these past number of years, which results in the

SABFS not being able to access any funding.

e-learning readiness of the Sheriff’s ProfessionProfessional innovation and development of the sheriff’s

profession are shaped profoundly by the capabilities of the

SABFS as a training provider. The SABFS agrees that public

services and related institutions need to be turned into

innovative and digitised training spaces, which in turn has the

potential to contribute to liberating South Africans from the skills

gaps the country is experiencing. In essence, it is about guiding

sheriffs through their learning paths, and in so doing, create a

continuous culture and practice of learning.

The SABFS has issued a specification to obtain a LMS system

which will be the platform for e-learning.

Advocate Hishaam Mohamed.



needs Based training 2016The hosting of the 2016 Needs Based Training [NBT] programme

in the nine respective provinces, was of significance, because

of the scale, logistics, preparatory work, insurance of delivery

of educational outcomes and budgetary requirements. The

purpose of this training programme is to ensure that participants

have basic competence to deal with matters relating to the

civil justice system, procedures and processes, with specific

reference to operational areas of work affecting the role and

duties of the sheriff.

We invited specialists in particular learning areas, for example,

the views of auditors and accountants in the management

and administration of Trust and Business accounts, and we

engaged panellists, including Magistrates, the Human Rights

Commission, the SAPS, the Ministry of Human Settlements,

the Gauteng Housing Crisis Committee and sheriffs on the

legal issue of evictions. Approximately 34 individuals from the

respective stakeholders presented their views on Evictions,

Trust and Business accounts and SARS/Tax matters.

The focus of the training programme was on Evictions and Trust

and Business accounts. Panellists on evictions spoke from the

perspective where they are located in the framework of civil

procedures and relevant legislation pertaining to this sensitive

and complex subject.

Concerns were raised regarding the low attendance in some

of the provinces. Day 2 was dedicated to Trust and Business

account training. Very few sheriffs attended this session.

However, our records reveal a spike in the maladministration

of these accounts. Yet sheriffs claim not to have received

appropriate training to administer their finances – when identified

and investigated by the SABFS.

The venues used, were mainly provided free of charge by

sister organisations, however, this generosity also presented

its own challenges such as the operational state of equipment,

venues that are not conducive for training, parking facilities and

general logistical challenges. It needs to be noted that despite

these challenges, significant working relationships have been

established with kindred organisations and institutions and the

SABFS is most thankful to these stakeholders for hosting us.

0 10 20 30 40 50 60 70 80

Female

Male

Indian

Coloured

African

White

70%

23%

63%

8%

6%

30%

Needs Based Training 2016 – Attendance



Delegates identified which topics/sessions the SABFS should

cover in the next round of NBT.

• Removal and eviction costs;

• Expanding the engagement of SARS on tax issues;

• Nula Bona;

• Movable and immovable auctions;

• E-Learning and computer literacy;

• Insolvency Act;

• Sales in execution, Land claims in rural areas, Ethics;

• How to read processes;

• Capital Selecta from security, property law, insolvency;

• Office administration;

• Regulations in line with guidelines regarding with evictions;

• Rule 46;

70%

0

20

40

60

80

100

Success RateAbstainedAverageGoodExcellent

Overall Rating of Training

Compliance, e.g. Legal Obligations

Trust and Business Accounts

LMS/e-LEARNINGEvictions

Needs Based Training 2016 – Topic/Sessions

Board Member, Prof Fernandez, along with the SABFS Executive Manager, Mrs Snell and Cape Town based sheriffs, Mr Carelse and Ms Tobias hosted the delegation at the office of the Board at 88 Loop Street.

Visit by the Vietnamese Ministry of Justice The Embassy of the Socialist Republic of Vietnam met with the

Board in September 2016, together with a delegation from the

Vietnamese Ministry of Justice that was led by His Eminence Mr

Nguyen Khanh Ngoc, Deputy Minister of Justice.

The visit was aimed at strengthening cooperation on legal and

judicial areas between Vietnam and South Africa in general,

between the Ministry of Justice of Vietnam and legal and judicial

agencies/organisations of South Africa in particular; to learn and

share experiences on the legal and judicial reforms between

Vietnam and South Africa; and to study the legal and judicial

system of South Africa, especially the legal aid system.

• Maritime of property;

• Ongoing engagement on executions, legal obligation,

unclaimed funds, evictions, residue, business accounts,

disciplinary process, trust monies;

• Training deputies in particular according to their needs;

• Rolling of cash;

• Rule 46;

• Divorce cases/execution;

• Rural cases of interventions by sheriffs;

• Small claim court matters;

• Marketing of auctions;

• Interpleaders; and

• Changes in Sheriff’s Act, rules and regulations where there

are negative consequences to the operations of sheriffs.



Mentorship and Assistance Programme

The Mentorship Programme is an integral part of the Training

Division’s 2016/2017 work plan and in sync with the strategic

objectives of the Board.

The key aim of the programme, which is preventative by

definition, is to identify skills and knowledge gaps in/at sheriffs’

offices and those offices that face professional challenges. The

SABFS will therefore intervene with appropriate remedial and

supportive action.

It is the practice of the Board to recognise the need to assist

individual sheriffs that are experiencing difficulties to provide an

efficient service to the public, the courts and the legal profession.

The emerging Quality Management System of the SABFS states

in its vision statement that: “We will promote a professional

sheriff’s service that is respectful and efficient, to deliver justice

to all with integrity and accountability”.

Sheriffs are identified for the Mentorship Programme in close

liaison with the Legal and Complaints Division of the Board. This

division provided statistics in respect of the nature of complaints

received, from March 2015 to February 2016. Failure to serve/

execute without avoidable delay has been identified as a priority

area, with the Eastern Cape and Gauteng topping the percentage

of challenges faced by sheriffs.

Based on the surveys conducted after the mentorship was

completed, the mentees expressed their appreciation for

the opportunity to participate in the mentorship programme.

Mentorship among sheriffs should be viewed as a preventative

programme and we are encouraging sheriffs who have gone

through this programme, to popularise it as a positive experience.

TOTAL NUMBER OF LEARNERS – 8MaleFemale

37.5%62.5%

WhiteBlack

33%

67%

Mentorship Programme – Race Representation

Mentorship Programme – Gender Representation

The table lists the top 12 type complaints the SABFS receive per province.

TYPE OF COMPLAINT EC FS GAU KzN LP MP NW NC WC

Delay/refusal to respond to plaintiffs’ correspondence. 1 13 8 1 1

Failure to serve within the jurisdiction which sheriff is appointed. 1

Failure to serve/execute without avoidable delay. 33 4 33 24 4 1 5 2 6

Failure to tender return of service. 9 3 3 10 2 1 2

Neglect/dilatory in the service/execute of any process. 1 2

Prejudice the administration, discipline. 1 8 1 1 1

Bribery and/or corruption. 1

Bringing the good name of the Sheriffs into disrupt. 2 2 2 1 1 1

Overcharging.

Commits an offence involving violence, dishonesty, extortion. 1 1

Delay/failure to pay over trust monies. 8 6 3 5 2 4 4

Failure to keep proper records. 1

TOTAL 56 29 60 42 10 1 11 3 23



SIC – Race Representation

SIC – Gender Representation

Sheriff’s introductory course 2016

The Skills Programme (Sheriffs Introductory Course – SIC

ID 57712), at NQF Level 4, can be used to contribute to the

further development of the current employee within the sheriffs’

profession by providing recognition, further mobility and

transportability. The SIC could therefore be used as a process

of continued professional development to ensure service

excellence.

The planned training course ensures that the participant/

sheriff will have a basic competence to deal with financial

and administrative matters in the sheriff’s office, serve and

execute processes in compliance with relevant legislation, and,

throughout, apply appropriate communication skills within the

context of the Constitution. This is a basic entrance qualification

and all newly appointed sheriffs would normally attend the

course.

On 1 February 2016 in Pretoria, the Deputy Minister for Justice

and Constitutional Development, Mr John Jeffery, addressed

the SIC learners during the Induction Day – “The mandatory

induction training programme which you are attending is

extremely important and is underpinned by three motivating

factors:

• To familiarise new appointees with the operations and day-

to-day business of the sheriff’s office;

• To set a uniform standard of practice and performance to

assist in the minimisation of complaints; and

• To empower the new appointees through training and

mentoring, thus ensuring that they meet the minimum

standard of requirements as stipulated by the Board.

Deputy sheriffs play a crucial role in all sheriffs’ offices, as

they interact regularly with the public, attorneys and other

stakeholders. Deputy sheriffs are often the face of the sheriff’s

profession. That’s why we are pleased to note that many deputy

sheriffs are also attending this induction training programme”.

Of the 31 learners who attended the course, only 14 were newly

appointed sheriffs as the remainder were already permanent

sheriffs – either in neighbouring sheriff offices or who were

moving from an economically smaller area to a bigger one.

17 Deputy sheriffs attended the training to bring the total to

31 learners. All 31 learners were found to be competent and

received their certification from the SASSETA.

TOTAL NUMBER OF LEARNERS - 31

0 10 20 30 40 50 60 70 80

African

White

Coloured 10%

16%

74%

Female Male

48%52%

Sheriffs Introductory Course 2016 Learners.



» ProGrAMMe 5: Governance and corporate Support Services

The goal of this programme is to improve compliance with

legal requirements and good governance principles to increase

stakeholder trust.

This is performed through:

1.1. Governance activities of the Board and Committees of

SABFS.

1.2. Managing the human capital resources and performance

to deliver effectively on SABFS mandate.

1.3. Effective and Efficient Financial Management and

procurement processes.

1.4. Implementing Quality Management System and practices.

1.5. Using Information Technology to support operational

processes.

1.6. Enterprise Wide Risk Management at SABFS.

1.7. Provision of internal and external assurance to the Board.


• Corporate Governance processes

• Quality Management processes

• Risk Management processes

• Human Resource Management processes

• Financial Management and Procurement processes

• Information Technology Management processes

• Internal and External Assurance processes

The Board established an Audit and Risk committee with an

independent chairperson in the previous period. This committee

was fully functional for the year under review.

3 YEAR STRATEGIC PLAN

The Board has adopted a Strategic Plan for the 3 year period 2015-2018. Management was charged with operationalising the

plan and reporting quarterly on the performance achievements on the stated objectives.

PROGRAMME 1: Compliance

PROGRAMME 2: Fidelity Fund

PROGRAMME 3: Sustainability of the Sheriffs Profession

PROGRAMME 4: Enhancing the Sheriffs Profession

PROGRAMME 5: Governance and Corporate Support Services


HUMAN RESOURCE MANAGEMENT

The Board has adopted the principles of Batho Pele and expects the staff to walk the talk on these principles.

– Meko Magida

PART D

30


annual rePorT 2016-2017

1. organisationaL struCture – offiCe of tHe Board

The Board has approved an organogram for SABFS. The Board is managed by an Executive Manager who reports directly to the Board.

eXecutiVe MAnAGerS. Snell

MAnAGer: LeGAL And coMPLAintS

Vacant

AdMiniStrAtion ASSiStAnt

A. tshabalala

LeGAL cASe officerVacant

inSPectorVacant

LeGAL AdMiniStrAtorf. Mohamed

coMPLAintS AdMiniStrAtor

M. dikgacwi

inSPectorVacant

PArALeGALt. Scheepers

trAininG officerV. Weitz

coMMunicAtionS officert. hassan

AdMiniStrAtion ASSiStAntL. delport

MAnAGer: trAininG, deVeLoPMent And coMMunicAtionS

V. nel

GenerAL MAnAGer: corPorAte And

finAnciAL SerViceSA. Simon

MAnAGer: huMAn reSourceS, coMPLiAnce

And AdMiniStrAtionB. Luthuli

eXecutiVe PerSonAL ASSiStAntS. Jones

AdMiniStrAtion ASSiStAnt

e. Khope

finAnce officerc. fortuin

BooKKeePerL. Matyolo

ASSiStAnt BooKKeePer

S. toerien

fideLitY fund MAnAGerP. ngwane

ShArePoint/SYSteM AdMiniStrAtion

L. Bell

coMPLiAnce AdMiniStrAtor And

dAtA cAPturerVacant

recePtioniStA. Makanda

driVer, MAiLinG And fiLinG cLerK

c. huegh

recordS MAnAGeMent cLerKn. Silo

GenerAL ASSiStAntG. ngquba



2. HuMan resourCe oversigHt statistiCs

The office operates as four divisions, each with a clear

line of authority and reporting. They in turn support the

Board, who have established six committees to carry out

their functions.

The Board’s day-to-day functions are carried out by a dedicated

team of professionals under the guidance of an Executive

Manager. Nehawu is the majority representative union and the

SABFS has entered into a recognition agreement with them.

The Board has an administrative staff establishment of 22 approved

and funded posts. We currently employ 7 males and 15 females.

STAFF COMPLEMENT AS AT 28 FEBRUARY 2017

MANAGEMENT STAFF TOTAL

MALE FEMALE MALE FEMALE

African 1 0 2 6 9

Coloured 2 1 2 8 13

Indian 0 0 0 0 0

White 0 0 0 0 0

Total 3 1 4 14 22

Staff MovementThe table below reflects staff movement over the period. There

were 7 new permanent appointments made which increased the

staff complement by 2 males and 5 females.

We had 5 resignations during this period which had decreased

the staff complement by 1 male and 4 females.

NO. STAFF POSITION RESIGNATIONS

1 Vukile Shandu Inspector 2 Yvonne Olivier Bookkeeper & Payroll Administrator3 Zinhle Dimande Inspector 4 Vanessa Botha Legal & Complaints Division Manager5 Brenda Goniwe Legal Case Officer

RETIREMENTSNone

APPOINTMENTS1 Vukile Shandu Inspector 2 Phila Ngane Fidelity Fund Administrator3 Andiswa Makhanda Receptionist 4 Lizeka Matyolo Bookkeeper & Payroll Administrator5 Tasneem Hassan Communications Officer6 Fahemah Mohamed Legal Administrator 7 Tamlyn Scheepers Paralegal

Employee CostsEmployee cost for the period amounted to R8,94m (2015/16:

R7,84 m). The Board approved a 7.2% salary increase for staff

and 6.2% for management.

Medical Aid Scheme The Board provides medical aid benefits for staff through

Discovery Health.

Retirement Fund The Board is a Participating Employer under the Sanlam

Umbrella Pension Fund which provides retirement and benefits

for its staff members. The risk benefits are provided under a

separate risk scheme also underwritten by Sanlam. Seed Benefit

Consulting CC provide the required intermediary and consulting

services for the employer and staff members alike.

The Volatility Protection Strategy is the chosen default investment

strategy for the assets of the Pension Fund. This strategy provides

guarantees with benefit payments and ensures capital stability.

The trustees of the Sanlam Umbrella Fund review the investment

strategy of the Volatility Protection Strategy continually, and will

make periodic changes to the underlying investments in line with

the objectives of the strategy. The Volatility Protection Strategy

has historically invested contributions in the Sanlam Monthly

Bonus Fund, but in early 2017 has commenced the process of

investing new cash flows in the Satrix (SWIX) 75% in the Sanlam

Monthly Bonus Fund and 25% in the Satrix (SWIX) Balanced

Transfer Fund.

The returns of the Sanlam Monthly Bonus Fund for the 1 year

ending 28 February 2017 were 8.20% p.a. The longer-term

returns were 11.70% for the 3-year period and 12.70% for the

5 year period ending 28 February 2017.

Performance ManagementThe organisation has a performance management system in

place which is regulated by a performance management policy.

The performance management policy makes provision for

performance incentives to be paid to deserving staff members

who have performed consistently throughout the year. Annually,

staff members enter into and sign performance agreements

with the organisation. The purpose of entering into performance

agreements is to communicate the performance expectations



of the SABFS to the staff and to drive the objectives of

the organisation through aligning individual performance

expectations with the Board strategy.

For the year under review five (5) staff members were awarded

performance incentives by the Board to the total value of

R 53 828.78. For the new year, the HR Committee is hoping to

increase the number of staff who qualify for a performance bonus.

Staff Training and DevelopmentAnnually the staff and managers of the SABFS prepare individual

learning plans for each staff member guided by the requirements

of their position, and the development needs of the staff

member. These plans feed into an Annual Training Plan which

is approved by the Board and rolled out in the year. The Board

prioritises accredited training and the interventions consisted of

funding bursaries to complete degrees and diplomas; short skills

programmes and internal training initiatives. In the reporting

period, the Board spent R137 027.20 on training.

ANNUAL TRAINING REPORT FOR 2016/17

NO COURSE INSTITUTION COST

1 Paralegal SA Law School R19 445.00

2 LLB UNISA R5 850.00

3 Paralegal SA Law School R 2 270.00

4 Receptionist course CAD Training R6 500.00

5 Paralegal SA Law School R 6 570.00

6 Receptionist course CAD Training Centre

R6 500.00

7 Microsoft SharePoint (level 1+2)

LearnFast Training Solutions

R12 550.00

8 Bookkeeping online short course

UCT R12 535.00

9 Diploma in Business Management

Boston City Campus & Business College

R16 256.00

10 Bachelor of Administration (B Admin)

UNISA R 4 590.00

11 Emotional Intelligence for 12 staff members

FastTrack Training

R 20 500.00

12 Conflict Management & Negotiation Skills for 10 staff members

Business Optimisation Training Institute

R23 461.20

TOTAL R137 027.20

The following training initiatives were conducted in-house and

there was no cost to the Board.

COURSE INSTITUTION/TRAINER

ATTENDEES

IT Training Session including cybercrime awareness and social engineering

Simplified IT All staff

Supply Chain Management Refresher Training

Andrew Simon All staff dealing with SCM

Ethics & Fraud Awareness KPMG All Staff

Disciplinary Action taken against StaffThe Board believes in a system of progressive discipline which

requires that staff members be familiar with their performance

standards, policy prescripts and the performance culture of the

SABFS. The Board has adopted the principles of Batho Pele and

expects the staff to walk the talk on these principles. From time

to time, there is a need to take disciplinary steps against staff

members who do not rectify their conduct or performance.

Management dealt with one incident of poor performance and

conducted informal counselling sessions with a staff member

during the year under review. This had a serious long-term effect

on the division where the staff member was based. The process

has been pended as the staff member is pursuing medical

boarding.

Another staff member was charged and suspended by the Board

and the disciplinary process was ongoing as at year end.

Occupational Health and SafetyThe OHS Committee was established in 2015. It is fully functional

and has been meeting monthly for the year under review. Four

members of the OHS Committee attended the First Aid in

May 2016. Additional training for the committee members is

scheduled to take place in the new financial year.

First Aid Training.



Women’s Day at SABFSThe SABFS used Women’s day to promote gender issues that

women encounter in the workplace and empower them with the

skills to deal with these challenges. Local female sheriffs joined

SABFS staff in the workshop.

There were three speakers for the day;

• Dr Liezille Jacobs, who holds a PHD in Psychology, spoke

about challenges of being a woman today;

• Advocate Nonkosi Cetywayo, Sheriff of the Bellville High

Court, spoke about the challenges of being a woman in the

sheriff’s profession; and

• Former staff member Brenda Goniwe, spoke about being a

woman in the workplace.

Wellness at SABFSAnnually the SABFS coordinates two Wellness Days for staff.

The first focused on winter wellness and staff were provided

with a flu injection as well as information on healthy eating and

supplements to avoid succumbing to winter illnesses.

A Financial Wellness Workshop was held in the second half of

the year and the workshop covered broad areas of financial

well-being and financial planning. The speakers present were

Mr Meyer De Waal from Flisp, who spoke about property

investments, Shameela Patel from Standard Bank, spoke about

financial literacy and debt review and Lidia Nunes from Seed

Consulting, had a presentation on how to live well financially.

Work Integrated Learning It was reported in the previous annual report that the Public

Sector Education and Training Authority (PSETA) approved and

granted the Board funding, for Work Integrated Learning only.

The funding was for four learners at R36 000 per learner which

equals to R144 000 total funding, for the period of up to 18

months. The Board topped the stipend payment from its own

funds.

The PSETA funded interns were recruited from Midlands FET

in Grahamstown EC, Ingwe FET in Maluti Eastern Cape and

Northlink College Tygerberg.

HR Policy ReviewThe organisation regards policies as living documents therefore,

it is necessary that they are updated to make sure that they

remain up-to date and relevant. A number of HR policies were

tabled and approved by the Board during the year under review.

They are:

POLICY STATUS1. The Employee Wellness Approved by Board July 2016

BD69/07/20 2. Health and Safety Policy Approved by Board July 2016

BD70/07/203. Code of Conduct Approved by Board December

2016 BD4. Leave and Absence from

employmentApproved by Board December 2016 BD

Davina Cupido (Bellville South Lower court), Amanda Tobias (Cape Town North), Sharon Snell (Executive Manager, SABFS) and Dr Liezille Jacobs.

SABFS staff with invited guests.


FINANCIAL INFORMATIONPART ESOUTH AFRICAN BOARD FOR SHERIFFSEstablished in Terms of the Sheriffs Act 90 of 1986, as Amended

The Auditor has issued a clean and unqualified audit opinion on both the SABFS and the Fidelity Fund financial statements. – Khunjulwa Sigenu



annuaL finanCiaL stateMentsfor tHe Year ended 28 feBruarY 2017

CONTENTS PAGEStatement of Board’s Responsibilities and Approval 36

Independent Auditor’s Report 37-39

Board Members’ Report 40

Statement of Financial Position 41

Statement of Financial Performance 42

Statement of Changes In Net Assets 43

Cash Flow Statement 44

Statement of Comparison of Budget and Actual Amounts 45

Accounting Policies 46-53

Notes to the Annual Financial Statements 54-61

The following supplementary information does not form part of the annual financial statements and is unaudited:

Detailed Statement of Financial Performance 62-63

SOUTH AFRICAN BOARD FOR SHERIFFSANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 28 FEBRUARY 2017


STATEMENT OF BOARD’S RESPONSIBILITY AND APPROVAL

The Board is required by the Sheriffs Act no. 90 of

1986, to maintain adequate accounting records and is

responsible for the content and integrity of the annual

financial statements and related financial information included

in this report. It is the responsibility of the Board to ensure that

the annual financial statements fairly present the state of affairs

of the entity as at the end of the financial year and the results

of its operations and cash flows for the period then ended. The

external auditors are engaged to express an independent opinion

on the annual financial statements and were given unrestricted

access to all financial records and related data.

The annual financial statements have been prepared in

accordance with Standards of Generally Recognised Accounting

Practice (GRAP) including any interpretations, guidelines and

directives issued by the Accounting Standards Board.

The annual financial statements are based upon appropriate

accounting policies consistently applied and supported by

reasonable and prudent judgements and estimates. The Board

acknowledges that it is ultimately responsible for the system

of internal financial control established by the entity and place

considerable importance on maintaining a strong control

environment. To enable the Board to meet these responsibilities,

the Board sets standards for internal control aimed at reducing

the risk of error or deficit in a cost effective manner. The

standards include the proper delegation of responsibilities within

a clearly defined framework, effective accounting procedures

and adequate segregation of duties to ensure an acceptable

level of risk. These controls are monitored throughout the entity

and all employees are required to maintain the highest ethical

standards in ensuring the entity’s business is conducted in a

manner that in all reasonable circumstances is above reproach.

The focus of risk management in the entity is on identifying,

assessing, managing and monitoring all known risks to

minimise it by ensuring that appropriate infrastructure, controls,

systems and ethical behaviour are applied and managed within

predetermined procedures and constraints.

The members are of the opinion, 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 annual financial

statements. However, any system of internal financial control

can provide only reasonable, and not absolute, assurance

against material misstatement or deficit.

The Board has reviewed the entity’s cash flow forecast for the

year to 28 February 2018 and, in the light of this review and

the current financial position, it is satisfied that the entity has

or has access to adequate resources to continue in operational

existence for the foreseeable future. The annual financial

statements are prepared on the basis that the entity is a going

concern and that the Board has neither the intention nor the

need to liquidate or curtail materially the scale of the entity.

Although the Board is primarily responsible for the financial

affairs of the entity, it is supported by the entity’s external

auditors.

The external auditors are responsible for independently reviewing

and reporting on the entity’s annual financial statements. The

annual financial statements have been examined by the entity’s

external auditors and their report is presented on pages 37 to 39.

The annual financial statements set out on pages 40 to 63, which

have been prepared on the going concern basis, were approved

by the Board on 27 July 2017 and were signed on its behalf by:

MRS. C MABUzAChairperson of the Board

MS. K SIGENUChairperson: Finance Committee

MRS. S SNELL Executive Manager

SOUTH AFRICAN BOARD FOR SHERIFFSANNUAL FINANCIAL STATEMENTS

FOR THE YEAR ENDED 28 FEBRUARY 2017


INDEPENDENT AuDITORS’ REPORTTo the Minister of Justice and Correctional Services

OpinionWe have audited the annual financial statements of the South

African Board for Sheriffs, which comprise the statement of

financial position as at 28 February 2017, the statement of

comprehensive income, statement of changes in funds and

statement of cash flows and statement of comparison of budget

and actual amounts for the year then ended, and a summary of

significant accounting policies and other explanatory notes, as

set out on pages 40 to 61.

In our opinion, the annual financial statements present fairly,

in all material respects, the financial position of the South

African Board for Sheriffs as at 28 February 2017, its financial

performance and its cash flows and statement of comparison

of budget and actual amounts for the year then ended, in

accordance with the South African Standards of Generally

Recognised Accounting Practice (GRAP) and the requirements

of the Sheriffs Act No. 90 of 1986, as amended.

Basis for OpinionWe conducted our audit in accordance with International

Standards on Auditing (ISAs) and the Public Audit Act of South

Africa, 2004 (Act No. 25 of 2004) (PAA), and the general notice

issued in terms thereof. Our responsibilities under those standards

are further described in the Auditor’s Responsibilities section of our

report. We are independent of the South African Board for Sheriff

in accordance with IRBA requirements which is in accordance

with International Ethics Standards Board for Accountant’s Code

of Ethics for Professional Accountants (IESBA Code).

We believe that the audit evidence we have obtained is sufficient

and appropriate to provide a basis for our opinion.

Key Audit MattersKey audit matters are those matters that, in our professional

judgement, were of most significance in our audit of the annual

financial statements of the current period. No such matters were

identified during the audit.

Other Supplementary InformationWe draw attention to the fact that supplementary information set

out on pages 64 to 65 does not form part of the annual financial

statements and is presented as additional information. We have

not audited this information and accordingly do not express an

opinion thereon.

The Board of Director’s Responsibility for the Annual Financial StatementsThe members of the Board are responsible for the preparation

and fair presentation of these annual financial statements in


Recognised Accounting Practices and the requirements of the

Sheriffs Act No. 90 of 1986, as amended, and the Public Audit

Act, 2004 (Act No. 25 of 2004). This responsibility includes:

designing, implementing and maintaining internal control

relevant to the preparation and fair presentation of annual

financial statements that are free from material misstatement,

whether due to fraud or error; selecting and applying appropriate

accounting policies; and making accounting estimates that are

reasonable in the circumstances.

In preparing the annual financial statements, management

is responsible for assessing the entity’s ability to continue as

a going concern, disclosing, as applicable, matters related to

going concern and using the going concern basis of accounting

Head Office20 Morris Street East, Woodmead, 2191

P.O.Box 2939, Saxonwold, 2132Tel: +27 (0) 11 231 0600Fax: +27 (0) 11 234 0933

Cape Town32 Century Boulevard, Block A, 2nd Floor

Century Falls, Cape Town, 7441P.O. Box 15565, Vlaeberg, 8018

Tel: +27 (0) 21 552 5311Fax: +27 (0) 21 552 2805

Victor Sekese (Chief Executive)A comprehensive list of all Directors is available at the company offices or registered office.

SizweNtsalubaGobodo Incorporated. Registration Number: 2005/034639/21



unless management either intends to liquidate the entity or

cease operations, or has no realistic alternative but to do so.

Auditor’s ResponsibilityOur 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 our opinion.

Reasonable assurance is a high level of assurance, but is not

a guarantee that an audit conducted in accordance with 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 the aggregate, they could reasonably

be expected to influence the economic decisions of users taken

on the basis of these annual financial statements.

As part of an audit in accordance with ISAs, we exercise

professional judgement and maintain professional scepticism

throughout the audit. We also:

• Identify and assess the risks of material misstatement of

the annual 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 of our 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 override 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 Fund’s

internal control.

• Evaluate the appropriateness of accounting policies used

and the reasonableness of accounting estimates and

related disclosures made by management.

• Conclude on the appropriateness of management’s use of

the going concern basis of accounting and, based on the

audit evidence obtained, whether a material uncertainty

exists related to events or conditions that may cast

significant doubt on the Fund’s ability to continue as a going

concern. If we conclude that a material uncertainty exists,

we are required to draw attention in our auditors report to

the related disclosures in the annual financial statements or,

if such disclosures are inadequate, to modify our opinion.

Our conclusions are based on the audit evidence obtained

up to the date of our auditor’s report. However, future events

or conditions may cause the Fund to cease to continue as

a going concern.

• Evaluate the overall presentation, structure and content of

the annual financial statements, including the disclosures,

and whether the annual financial statements represent

the underlying transactions and events in a manner that

achieves fair presentation.

We communicate with those charged with governance regarding,

among other matters, the planned scope and timing of the

audit and significant audit findings, including any significant

deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement

that we have complied with relevant ethical requirements

regarding independence, and to communicate with them all

relationships and other matters that may reasonably be thought

to bear on our independence, and where applicable, related

safeguards.

Report on Other Legal and Regulatory RequirementsIn accordance with the PAA and the General Notice issued

in terms thereof, we report the following findings on the

performance information against predetermined objectives,

non-compliance with legislations as well as internal control.

We performed tests to identify reportable findings as described

under each subheading but not to gather evidence to express

assurance on these matters. Accordingly, we do not express an

opinion or conclusion on these matters.

Predetermined ObjectivesWe did not audit performance against predetermined objectives,

as the entity is not required to prepare a report on its performance

against predetermined objectives. The entity does not fall within

INDEPENDENT AuDITORS’ REPORT (Continued)





the ambit of the PFMA and the entity-specific legislation does

not require reporting on performance against predetermined

objectives. There are no matters to report.

Compliance with LegislationWe performed procedures to obtain evidence that the South

African Board for Sheriffs had complied with legislation

regarding financial matters, financial management and other

related matters. We did not identify any instances of material

non-compliance with specific matters in key legislation, as set

out in the general notice issued in terms of the PAA.

Internal ControlWe considered internal control relevant to our audit of the

financial statements, annual performance report and compliance

with legislation. We did not identify any significant deficiencies

in internal control.

SizweNtsalubaGobodo Inc.

Director: Natalie Arendse

Registered Auditor

Date: 31 july 2017

2nd Floor, Block A, Century Falls,

32 Century Boulevard, Century City

Cape Town

7441



BOARD MEMBERS’ REPORTThe Board members submit their report for the year ended 28 February 2017.

1. Review of Activities: Main Business and Operations

The entity is governed in terms of the Sheriffs Act no.90 of 1986,

the objectives of the Board are to maintain the esteem, enhance

the status and improve the standard of training and functions

performed by sheriffs who operates throughout South Africa.

2. Going ConcernThe annual financial statements have been prepared on the

basis of accounting policies applicable to a going concern. This

basis presumes that funds will be available to finance future

operations and that the realisation of assets and settlement of

liabilities, contingent obligations and commitments will occur in

the ordinary course of business.

3. Events After the Reporting PeriodThe board members are not aware of any matter or circumstances

arising since the end of the financial year that would materially

impact on the financial position of the entity.

4. Public Finance Management ActIn a Board meeting held on the 15th October 2015, the Board

resolved that the SABFS would no longer seeking listing in terms

of the Public Finance Management Act (“PFMA”) schedules as

required by S47(2) of the PFMA. The Board has resolved that

it will adopt and implement the principles of the PFMA into its

policies where it is economical and practical to do so.

5. Board MembersThe board members during the year and to the date of this report

are as follows:

NAME CHANGES

C. Mabuza (Chairperson) Re-appointed 1 March 2015

H. Mohamed Re-appointed 1 March 2015

T. Tembe Re-appointed 1 March 2015

P. Roodt Re-appointed 1 March 2015

N. Soga Appointed 1 March 2015

M. Lephadi Appointed 1 March 2015

I. Klynsmith Appointed 1 March 2015

L. Mashapa Appointed 1 March 2015

L. Fernandez Appointed 1 March 2015

M. Magida Appointed 1 March 2015

K. Sigenu Appointed 1 May 2016




STATEMENT OF FINANCIAL POSITION AS AT 28 FEBRuARY 2017

Figures in rand Note(s) 2017 2016

Assets

Current Assets

Trade and other receivables 8 1 793 886 1 421 470

Receivable from related party 10 2 064 520 2 819 269

Cash and cash equivalents 9 7 482 084 4 221 065

11 340 490 8 461 804

Non-Current Assets

Property, plant and equipment 4 2 259 662 2 394 666

Intangible assets 5 1 349 681 1 505 208

Investments held to maturity 6 818 560 -

4 427 903 3 899 873

Total Assets 15 768 393 12 361 677

Current Liabilities

Trade and other payables 12 810 825 1 476 166

Provisions 13 134 750 132 719

Total Liabilities 945 575 1 608 885

Net Assets 14 822 818 10 752 793

Accumulated Surplus 14 755 656 10 685 631

Non-Distributable Reserve 67 162 67 162

Total Net Assets 14 822 818 10 752 793



STATEMENT OF FINANCIAL PERFORMANCE FOR THE YEAR ENDED 28 FEBRuARY 2017


Revenue 15 18 256 201 16 077 250

Other income 15 447 874 135 228

Operating expenses (15 028 041) (16 354 291)

Operating surplus 16 3 676 034 (141 813)

Investment revenue 18 393 991 351 806

Surplus for the year 29 4 070 025 209 993




STATEMENT OF CHANGES IN NET ASSETS FOR THE YEAR ENDED 28 FEBRuARY 2017

Figures in RandAccumulated

surplusNDR - Revaluation

Reserve Total net assets

Balance at 01 March 2015 10 475 638 - 10 475 638

Changes in net assets


Balance at 01 March 2016 10 685 631 67 162 10 752 793


Surplus for the year 4 070 025 - 4 070 025

Balance at 28 February 2017 14 755 656 67 162 14 822 818



CASH FLOW STATEMENT FOR THE YEAR ENDED 28 FEBRuARY 2017


Cash flows from operating activities

Receipts

Receipts from sheriffs and Fidelity Fund 27 956 865 19 532 732

Payments

Payments to suppliers and Fidelity Fund (24 791 575) (21 199 611)

Net cash from operating activities 20 3 165 290 (1 666 879)

Cash flows from investing activities

Purchase of property, plant and equipment 4 (207 495) (225 504)

Proceeds on sale of Assets - -

Purchase of intangible assets 5 (26 123) (428 672)

Movement in receivable from related party 754 749 (932 302)

Movement in Investment held to maturity (818 560) -

Interest income 393 991 351 807

Finance cost 4 (833) (719 305)

Net cash flows from investing activities 95 729 (1 953 977)

Cash flows from financing activities

Increase Finance lease obligations - -

Payments made - (7 175)

Net cash flows from finance activities 11 - (7 175)

Net increase/(decrease) in cash and cash equivalents 3 261 019 (3 628 030)

Cash and cash equivalents at the beginning of the year 4 221 065 7 849 095

Cash and cash equivalents at the end of the period 9 7 482 084 4 221 065




STATEMENT OF COMPARISON OF BuDGET AND ACTuAL AMOuNTS FOR THE YEAR ENDED 28 FEBRuARY 2017

Figures in Rand Approved

budgetActual amounts on comparable basis

Difference between budget and actual Note

Revenue

Levies received 6 170 000 6 681 450 511 450 27

Administrative fees 11 120 000 11 574 751 454 751 27

Investment income 275 000 393 991 118 991 27

SETA grants 136 000 113 828 (22 172) 27

Other income 215 000 334 046 119 046 27

Total revenue 17 916 000 19 098 066 1 182 066 27

Operating Expenses

Board and sub committees 2 024 679 1 780 403 (244 276) 27

Executive Manager’s Office 826 332 308 553 (517 779) 27

Legal and Complaints Division 194 422 143 029 (51 393) 27

Formal Disciplinary Hearings 855 664 589 655 (266 009) 27

Finance, Administration and Compliance Division 420 000 284 277 (135 723) 27

Communication Activities 925 000 246 042 (678 958) 27

Training 805 000 663 181 (141 819) 27

General Operations - Depreciation 332 125 524 150 192 025 27

Contracts i.e. Cleaning, Office Maintenance 741 384 692 066 (49 318) 27

Other General Office Expenditure 1 025 754 1 345 143 319 389 27

Personnel Expenditure 8 777 703 8 314 528 (463 175) 27

Staff Development 250 000 137 014 (112 986) 27

Contingency budget 100 000 - (100 000) 27

Total expenses 17 278 063 15 028 041 (2 250 021) 27

Net Surplus 637 937 4 070 025 3 432 087 27



ACCOuNTING POLICIES

1. Presentation of Annual Financial Statements


accordance with the effective Standards of Generally Recognised

Accounting Practice (GRAP) including any interpretations,

guidelines and directives issued by the Accounting Standards

Board.

These annual financial statements have been prepared on an

accrual basis of accounting and are in accordance with historical

cost convention unless specified otherwise. They are presented

in South African Rand.

A summary of the significant accounting policies, which have

been consistently applied, are disclosed below.

1.1 Significant Judgements and Sources of Estimation Uncertainty


is required to make estimates and assumptions that affect

the amounts represented in the annual financial statements

and related disclosures. Use of available information and

the application of judgement is inherent in the formation of

estimates. Actual results in the future could differ from these

estimates which may be material to the annual financial

statements. Significant judgements include:

Trade receivablesThe entity assesses its trade receivables for impairment at

the end of each reporting period. In determining whether an

impairment loss should be recorded in surplus or deficit, the

surplus makes judgements as to whether there is observable

data indicating a measurable decrease in the estimated future

cash flows from a financial asset.

The impairment for trade receivables is calculated on a portfolio

basis, based on historical loss ratios, adjusted for national and

industry specific economic conditions and other indicators

present at the reporting date that correlate with defaults on the

portfolio. These annual loss ratios are applied to loan balances in

the portfolio and scaled to the estimated loss emergence period.

Fair value estimationThe carrying value less impairment provision of trade receivables

and payables are assumed to approximate their fair values.

ProvisionsProvisions were raised and management determined an estimate

based on the information available.

Effective interest rateThe entity used the prime interest rate to discount future cash flows.

Allowance for doubtful debtsOn debtors, an impairment loss is recognised in surplus and

deficit when there is objective evidence that it is impaired. The

impairment is measured as the difference between the debtors

carrying amount and the present value of estimated future cash

flows discounted at the effective interest rate, computed at initial

recognition.

1.2 Property, Plant and EquipmentProperty, 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 period.

The cost of an item of property, plant and equipment is

recognised as an asset when:

• it is probable that future economic benefits or service

potential associated with the item will flow to the entity; and

• the cost of the item can be measured reliably.

Property, plant and equipment is initially measured at costThe 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 management. Trade

discounts and rebates are deducted in arriving at the cost.

Where an asset is acquired at no cost, or for a nominal cost, its

cost is its fair value as at date of acquisition.

Costs include costs incurred initially to acquire an item of property,

plant and equipment and costs incurred subsequently to add to,

replace part of, or service it. If a replacement cost is recognised in

the carrying amount of an item of property, plant and equipment,

the carrying amount of the replaced part is derecognised.




Recognition of costs in the carrying amount of an item of

property, plant and equipment ceases when the item is in the

location and condition necessary for it to be capable of operating

in the manner intended by management.

Measurement subsequent to initial recognition plant and equipmentPlant and equipment are carried at cost less accumulated

depreciation and any impairment losses.

Plant and equipment are depreciated on the straight-line basis

over their expected useful lives to their estimated residual value.

Measurement subsequent to initial recognition propertyAfter recognition as an asset, Property whose fair value can be

measured reliably shall be carried at a revalued amount, being

its fair value at the date of the revaluation less any subsequent

accumulated depreciation and subsequent accumulated

impairment losses. Revaluations shall be made with sufficient

regularity to ensure that the carrying amount does not differ

materially from that which would be determined using fair value

at the reporting date. Property will be revalued every 3 years.

The useful lives of items of property, plant and equipment have

been assessed as follows:

ITEM AVERAGE USEFUL LIFE

Property 50 years

Burglar alarms 10 years

Computer equipment 4 years

Furniture and fixtures 4 years

Kitchen appliances 3 years

Office equipment 3 years

Motor vehicles 5 years

The residual value, the useful life and depreciation method of

each asset are reviewed at the end of each reporting date. If

the expectations differ from previous estimates, the change is

accounted for as a change in accounting estimate.

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.

The depreciation charge for each period is recognised in surplus

or deficit unless it is included in the carrying amount of another

asset.

Items of property, plant and equipment 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 from the derecognition of an item of

property, plant and equipment is included in surplus or deficit

when the item is derecognised. The gain or loss arising from

the derecognition of an item of property, plant and equipment is

determined as the difference between the net disposal proceeds,

if any, and the carrying amount of the item.

Use of estimates and management judgementIn assessing the remaining useful lives and residual values

of property, plant and equipment, management have made

judgements based on historical evidence as well as the current

condition of property, plant and equipment under its control.

1.3 Intangible Assets

An asset is identified as an intangible asset when it:• is capable of being separated or divided from an entity and

sold, transferred, licensed, rented or exchanged, either

individually or together with a related contract, assets or

liability; or

• arises from contractual rights or other legal rights, regardless

whether those rights are transferable or separate from the

entity or from other rights and obligations.

An intangible asset is recognised when:• it is probable that the expected future economic benefits or

service potential that are attributable to the asset will flow

to the entity; and

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

Intangible assets are initially recognised at costAn intangible asset acquired at no or nominal cost, the cost shall

be its fair value as at the date of acquisition.

An intangible asset arising from development (or from the

development phase of an internal project) is recognised when:

• it is technically feasible to complete the asset so that it will

be available for use or sale;

ACCOuNTING POLICIES (Continued)



• there is an ability to use or sell it;

• it will generate probable future economic benefits or service

potential;

• there are available technical, financial and other resources

to complete the development and to use or sell the asset;

and

• the expenditure attributable to the asset during its

development can be measured reliably.

Intangible assets are carried at cost less any accumulated

amortisation and any impairment losses.

The amortisation period and the amortisation method for

intangible assets are reviewed at each reporting date.

Amortisation is provided to write down the intangible assets, on

a straight line basis, to their residual values as follows:

Initial recognition and measurement


Computer software 3 years

Copyright material 10 years

Electronic database 10 years

1.4 Financial Instruments

Classification

The entity classifies financial assets and financial liabilities into

the following categories:

• Financial instruments at fair value;

• Financial instruments at amortised costs; and

• Financial instruments at cost.

Initial recognition and measurement Financial instruments are recognised initially when the entity

becomes a party to the contractual provisions of the instruments.

The entity classifies financial instruments, or their component

parts, on initial recognition as a financial asset, a financial liability

or an equity instrument in accordance with the substance of the

contractual arrangement.

Financial instruments are measured initially at fair value, except

for equity investments for which a fair value is not determinable,

which are measured at cost and are classified as available for

sale financial assets.

For financial instruments which are not at fair value through

surplus or deficit, transaction costs are included in the initial

measurement of the instrument.

Subsequent measurementLoans and receivables are subsequently measured at amortised

cost, using the effective interest method, less accumulated

impairment losses.

Financial liabilities at amortised cost are subsequently measured

at amortised cost, using the effective interest method.

Impairment of financial assetsAt each end of the reporting period the entity assesses all

financial assets, other than those at fair value through surplus

or deficit, to determine whether there is objective evidence that

a financial asset or group of financial assets has been impaired.

For amounts due to the entity, significant financial difficulties of

the debtor, probability that the debtor will enter bankruptcy and

default of payments are all considered indicators of impairment.

Where financial assets are impaired through use of an allowance

account, the amount of the loss is recognised in surplus or

deficit within operating expenses. When such assets are written

off, the write off is made against the relevant allowance account.

Subsequent recoveries of amounts previously written off are

credited against operating expenses.

Trade and other receivablesTrade receivables are measured at initial recognition at fair value,

and are subsequently measured at amortised cost using the

effective interest rate method.

Appropriate allowances for estimated irrecoverable amounts are

recognised in surplus or deficit when there is objective evidence

that the asset is impaired. Significant financial difficulties of

the debtor, probability that the debtor will enter bankruptcy or

financial reorganisation, and default or delinquency in payments

(more than 30 days overdue) are considered indicators that the

trade receivable is impaired.






The allowance recognised is measured as the difference

between the asset’s carrying amount and the present value of

estimated future cash flows discounted at the effective interest

rate computed at initial recognition.

The carrying amount of the asset is reduced through the use

of an allowance account, and the amount of the deficit is

recognised in surplus or deficit within operating expenses. When

a trade receivable is uncollectible, it is written off against the

allowance account for trade receivables. Subsequent recoveries

of amounts previously written off are credited against operating

expenses in surplus or deficit.

Trade and other receivables are classified as loans and

receivables.

Trade and other payablesTrade payables are initially measured at fair value, and are

subsequently measured at amortised cost, using the effective

interest rate method.

Cash and cash equivalentsCash and cash equivalents comprise cash on hand and demand

deposits and other short term highly liquid investments that are

readily convertible to a known amount of cash and are subject to

an insignificant risk of changes in value. These are initially recorded

at fair value and subsequently recorded at amortised cost.

1.5 LeasesA lease is classified as a finance lease if it transfers substantially

all the risks and rewards incidental to ownership. A lease is

classified as an operating lease if it does not transfer substantially

all the risks and rewards incidental to ownership.

Finance leases - lesseeFinance leases are recognised as assets and liabilities in the

statement of financial position at amounts equal to the fair

value of the leased property or, if lower, the present value of

the minimum lease payments. The corresponding liability to

the lessor is included in the statement of financial position as a

finance lease obligation.

Minimum lease payments are apportioned between the finance

charge and reduction of the outstanding liability. The finance charge

is allocated to each period during the lease term so as to produce

a constant periodic rate on the remaining balance of the liability.

Operating leases – lessorOperating lease revenue is recognised as revenue on a straight

line basis over the lease term.

Initial direct costs incurred in negotiating and arranging operating

leases are added to the carrying amount of the leased asset and

recognised as an expense over the lease term on the same basis

as the lease revenue.

The aggregate cost of incentives is recognised as a reduction of

rental revenue over the lease term on a straight line basis.

The aggregate benefit of incentives is recognised as a reduction

of rental expense over the lease term on a straight line basis.

Income for leases is disclosed under revenue in statement of

financial performance.

Operating leases – lesseeOperating lease payments are recognised as an expense on a

straight line basis over the lease term. The difference between

the amounts recognised as an expense and the contractual

payments are recognised as an operating lease asset or liability.

1.6 Employee Benefits

Short-term employee benefitsThe cost of short term employee benefits, (those payable within

12 months after the service is rendered, such as paid vacation

leave and sick leave, bonuses, and non-monetary benefits such

as medical care), are recognised in the period in which the

service is rendered and are not discounted.

The expected cost of compensated absences is recognised as

an expense as the employees render services that increase their

entitlement or, in the case of non-accumulating absences, when

the absence occurs.

The expected cost of surplus sharing and bonus payments is

recognised as an expense when there is a legal or constructive

obligation to make such payments as a result of past

performance.

Defined contribution plansPayments to defined contribution retirement benefit plans are

charged as an expense as they fall due.

Payments made to industry managed (or state plans) retirement

benefit schemes are dealt with as defined contribution plans



where the entity’s obligation under the schemes is equivalent to

those arising in a defined contribution retirement benefit plan.

1.7 Provisions and ContingenciesProvisions are recognised when:

• the entity has a present obligation as a result of a past event;

• 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 amount of a provision is the best estimate of the expenditure

expected to be required to settle the present obligation at the

reporting date.

Where some or all of the expenditure required to settle a

provision is expected to be reimbursed by another party, the

reimbursement is recognised when, and only when, it is virtually

certain that reimbursement will be received if the entity settles

the obligation. The reimbursement is treated as a separate

asset. The amount recognised for the reimbursement does not

exceed the amount of the provision.

Provisions are not recognised for future operating deficits.

Contingent assets and contingent liabilities are not recognised.

Contingencies are disclosed in note 30.

1.8 Revenue from Exchange TransactionsRevenue is the gross inflow of economic benefits or service

potential during the reporting period when those inflows result

in an increase in net assets, other than increases relating to

contributions from owners.

An exchange transaction is one in which the entity receives

assets or services, or has liabilities extinguished, and directly

gives approximately equal value (primarily in the form of goods,

services or use of assets) to the other party in exchange.

Fair value is the amount for which an asset could be exchanged,

or a liability settled, between knowledgeable, willing parties in

an arm’s length transaction. An exchange transaction will be

recognised as and when the Board receives a declaration from

the sheriff.


MeasurementRevenue is measured at the fair value of the consideration

received or receivable, net of trade discounts and volume

rebates.

Sale of goodsRevenue from the sale of goods is recognised when all the

following conditions have been satisfied:

• the entity has transferred to the purchaser the significant

risks and rewards of ownership of the goods;

• the entity retains neither continuing managerial

involvement to the degree usually associated with

ownership nor effective control over the goods sold;

• 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

entity; and

• the costs incurred or to be incurred in respect of the

transaction can be measured reliably.

Rendering of servicesWhen 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:


• it is probable that the economic benefits or service potential

associated with the transaction will flow to the entity;

• 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.

Interest, royalties and dividendsRevenue arising from the use by others of entity assets yielding

interest, royalties and dividends is recognised when:

• It is probable that the economic benefits or service potential

associated with the transaction will flow to the entity; and




• The amount of the revenue can be measured reliably.

Interest is recognised, in surplus or deficit, using the effective


Investment income will be recognised as and when the Fund

becomes entitled to the income.

Service fees included in the price of the product are recognised

as revenue over the period during which the service is performed.

1.9 Revenue from Non-Exchange TransactionsRevenue comprises gross inflows of economic benefits or

service potential received and receivable by an entity, which

represents an increase in net assets, other than increases

relating to contributions from owners.

Conditions on transferred assets are stipulations that specify

that the future economic benefits or service potential embodied

in the asset is required to be consumed by the recipient as

specified or future economic benefits or service potential must

be returned to the transferor.

Control of an asset arises when the entity can use or otherwise

benefit from the asset in pursuit of its objectives and can exclude

or otherwise regulate the access of others to that benefit.

Non-exchange transactions are transactions that are not

exchange transactions. In a non-exchange transaction, an entity

either receives value from another entity without directly giving

approximately equal value in exchange, or gives value to another

entity without directly receiving approximately equal value in

exchange.

Restrictions on transferred assets are stipulations that limit or

direct the purposes for which a transferred asset may be used,

but do not specify that future economic benefits or service

potential is required to be returned to the transferor if not

deployed as specified.

Stipulations on transferred assets are terms in laws or regulations,

or a binding arrangement, imposed upon the use of a transferred

asset by entities external to the reporting entity.

RecognitionAn inflow of resources from a non-exchange transaction recognised

as an asset is recognised as revenue, except to the extent that a

liability is also recognised in respect of the same inflow.

As the entity satisfies a present obligation recognised as a

liability in respect of an inflow of resources from a non-exchange

transaction recognised as an asset, it reduces the carrying

amount of the liability recognised and recognises an amount of

revenue equal to that reduction.

MeasurementRevenue from a non-exchange transaction is measured at the

amount of the increase in net assets recognised by the entity.

When, as a result of a non-exchange transaction, the entity

recognises an asset, it also recognises revenue equivalent to the

amount of the asset measured at its fair value as at the date

of acquisition, unless it is also required to recognise a liability.

Where a liability is required to be recognised it will be measured

as the best estimate of the amount required to settle the

obligation at the reporting date, and the amount of the increase

in net assets, if any, recognised as revenue. When a liability is

subsequently reduced, because the taxable event occurs or a

condition is satisfied, the amount of the reduction in the liability

is recognised as revenue.

1.10 Comparative FiguresWhere necessary, comparative figures have been reclassified to

conform to changes in presentation in the current year.

1.11 Irregular, Fruitless and Wasteful ExpenditureIrregular expenditure means expenditure which was made

in contravention of the SABFS policies and procedures as

approved by the Board.

Fruitless expenditure means expenditure which was made in

vain and would have been avoided had reasonable care been

exercised.

All expenditure relating to fruitless and wasteful 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.

1.12 Budget InformationThe entity is typically subject to budgetary limits in the form

of budget authorisations (or equivalent), which is given effect

through Board resolutions or similar.




General purpose financial reporting by entity shall provide

information on whether resources were obtained and used in

accordance with the legally adopted budget.

The annual financial statements and the budget are not on the

same basis of accounting therefore a reconciliation between the

statement of financial performance and the budget have been

included in the annual financial statements. Refer to note 26.

1.13 Related PartiesThe objective of this standard is to ensure that a reporting

entity’s financial statements contain the disclosures necessary

to draw attention to the possibility that its financial position and

surplus or deficit may have been affected by the existence of

related parties and by transactions and outstanding balances

with such parties.

An entity that prepares and presents financial statements under

the accrual basis of accounting (in this standard referred to as

the reporting entity) shall apply this standard in:

• identifying related party relationships and transactions;

• identifying outstanding balances, including commitments,

between an entity and its related parties;

• identifying the circumstances in which disclosure of the

items in (a) and (b) is required; and

• determining the disclosures to be made about those items.

This standard requires disclosure of related party relationships,

transactions and outstanding balances, including commitments,

in the consolidated and separate financial statements of the

reporting entity in accordance with the Standard of GRAP on

Consolidated and Separate Financial Statements. This standard

also applies to individual financial statements.

Disclosure of related party transactions, outstanding balances,

including commitments, and relationships with related parties

may affect users’ assessments of the financial position and

performance of the reporting entity and its ability to deliver

agreed services, including assessments of the risks and

opportunities facing the entity. This disclosure also ensures that

the reporting entity is transparent about its dealings with related

parties.


The standard states that a related party is a person or an entity

with the ability to control or jointly control the other party, or

exercise significant influence over the other party, or vice versa,

or an entity that is subject to common control, or joint control.

As a minimum, the following are regarded as related parties of

the reporting entity:

• A person or a close member of that person’s family is

related to the reporting entity if that person;

• has control or joint control over the reporting entity;

• has significant influence over the reporting entity; or

• is a member of the management of the entity or its

controlling entity.

An entity is related to the reporting entity if any of the following

conditions apply:

• the entity is a member of the same economic entity (which

means that each controlling entity, controlled entity and

fellow controlled entity is related to the others);

• one entity is an associate or joint venture of the other

entity (or an associate or joint venture of a member of an

economic entity of which the other entity is a member);

• both entities are joint ventures of the same third party;

• one entity is a joint venture of a third entity and the other

entity is an associate of the third entity;

• the entity is a post-employment benefit plan for the benefit

of employees of either the entity or an entity related to

the entity. If the reporting entity is itself such a plan, the

sponsoring employers are related to the entity;

• the entity is controlled or jointly controlled by a person

identified in (a); and

• a person identified in (a)(i) has significant influence over that

entity or is a member of the management of that entity (or

its controlling entity).

The standard furthermore states that a related party transaction

is a transfer of resources, services or obligations between the

reporting entity and a related party, regardless of whether a price

is charged.





The standard elaborates on the definitions and identification of:

• Close member of the family of a person;

• Management;

• Related parties;

• Remuneration; and

• Significant influence

2. Changes in Accounting PolicyThe annual financial statements have been prepared in


Practice on a basis consistent with the prior year except where

new standards became available.

3. New Standards and Interpretations

3.1 Adoption of New and Revised Standards and Interpretations Issued and Effective

During the current year, the entity has adopted all new and revised

standards and interpretations, which have been published and

are mandatory for the entity’s accounting periods beginning on

or after 01 April 2016.

The following standards were effective for the first time for

financial statements covering periods beginning 1 April 2015,

however, these standards were not applicable to the entity:

• GRAP 18 Segment reporting

• GRAP 105 Transfers of functions between entities under

common control

• GRAP 106 Transfers of functions between entities not

under common control

• GRAP 107 Mergers

3.2 Adoption of New and Revised Standards and Interpretations Issued, but not yet Effective

The following standards were issued, but were not yet effective

for the 2017 financial year-end:

• GRAP 32 Service concession arrangements: Grantor

• GRAP 108 Statutory receivables

• GRAP 109 Accounting by principals and agents

• GRAP 110 Living and Non-living Resources



NOTES TO THE ANNuAL FINANCIAL STATEMENTS

4. Property, Plant and Equipment

2017 2016

Cost Accumulated Depreciation

Carrying value


Carrying value

Burglar alarms 2 700 (2 700) - 2 700 (2 700) -

Computer equipment 907 665 (641 069) 266 596 800 895 (516 267) 284 628

Furniture and fixtures 789 848 (692 265) 97 583 778 517 (584 968) 193 549

Kitchen appliances 13 644 (13 108) 536 13 644 (11 959) 1 685

Office equipment 205 583 (158 270) 47 313 150 959 (139 634) 11 325

Motor vehicles 197 890 (56 795) 141 095 197 890 (27 217) 170 673

Property 1 838 823 (132 284) 1 706 539 1 804 052 (71 246) 1 732 806

Total 3 956 153 (1 696 491) 2 259 662 3 748 657 (1 353 991) 2 394 666

Reconciliation of property, plant and equipment

2017

Opening balance

Additions Disposals Depreciation charge

Valuation adjustments

Closing Balance

Burglar alarms - - - - -

Computer equipment 284 628 106 770 - (124 802) - 266 596

Furniture and fixtures 193 549 11 331 - (107 297) - 97 583

Kitchen appliances 1 685 - - (1 149) - 536

Office equipment 11 325 54 624 - (18 636) - 47 313

Motor vehicles 170 673 - - (29 578) - 141 095

Property 1 732 806 34 771 - (61 038) - 1 706 539

2 394 666 207 495 - (342 501) - 2 259 662

Reconciliation of property, plant and equipment

2016

Opening balance


Accumulated Depreciation on disposals

Closing Balance

Burglar alarms - - - - - -

Computer equipment 405 279 14 313 - (134 964) - 284 628

Furniture and fixtures 303 607 10 766 - (120 824) - 193 549

Kitchen appliances 3 098 708 - (2 121) - 1 685

Office equipment 29 301 1 827 - (19 803) - 11 325

Motor vehicles - 197 890 - (27 217) - 170 673

Property 1 735 775 - - 43 587 (46 556) 1 732 806

2 477 060 225 504 - (261 342) (46 556) 2 394 666




4. Property, Plant and Equipment (Continued)Property

The Board have acquired a property situated at 88 Loop Street, Cape Town. The property was bought in the name of the SABFS as the Fidelity Fund can only invest in property and not own property.

The property have been accounted for as follows: 2017 2016

Cost of Building 13 370 326 13 370 326

less Portion Accounted for in the books of the Fidelity Fund (12 127 897) (12 127 897)

1 242 429 1 242 429

Additions as per Board Approval 513 901 513 901

Renovations 2015 94 278 94 278

Total Cost 28 February 1 850 608 1 850 608

Less Accumulated Depreciation at 29 February 2016 (113 718) (113 718)

Add Revaluation at 29 February 2016 67 162 67 162

Additions current financial year 34 771 -

Total Revalued amount/Cost 28 February 2017 1 838 823 1 804 052

A Valuation of the property was undertaken by Powells, Asset Valuation and disposals on the 25th February 2016. The portion reflected is the portion related to the SABFS only. The property was valued at R13,750,000.

5. Intangible Assets

2017 2016

Cost Accumulated Amortisation

Carrying value

Cost Accumulated Amortisation

Carrying value

Computer software 227 888 (183 168) 44 720 201 765 (151 169) 50 596

Copy right material 1 322 639 (286 145) 1 036 494 1 322 639 (136 494) 1 186 145

Electronic database 408 871 (140 404) 268 467 408 871 (140 404) 268 467

Total 1 959 398 (609 717) 1 349 681 1 933 275 (428 067) 1 505 208

Reconciliation of intangible assets

2017

Opening balance

Additions Disposals Amortisation Valuation/ Impairment

Adjustments

Closing Balance

Computer software 50 596 26 123 - (31 999) - 44 720

Copy right material 1 186 145 - - (122 031) - 1 064 114

Electronic database 268 467 - (27 620) - 240 847

1 505 208 26 123 - (181 650) - 1 349 681

Reconciliation of intangible assets

2016

Opening balance

Additions Disposals Amortisation Accumulated Amortisation on disposals

Closing Balance

Computer software 87 195 - - (41 892) 5 293 50 596

Copy right material 867 966 428 673 - (110 494) 1 186 145

Electronic database 303 355 - (34 888) - 268 467

1 258 516 428 673 - (187 274) 5 293 1 505 208

NOTES TO THE ANNuAL FINANCIAL STATEMENTS (Continued)




Figures in rand 2017 2016

6. Investments Held to MaturityStanLib investment 818 560 -

818 560 -

The investment in STANLIB represent the amount which are still retained in the Fund and await approval from the registrar of banks to approve the release of the funds invested in African Bank limited.

7. Financial Assets by CategoryThe accounting policies for financial instruments have been applied to the line items below:

Loans and receivables

Trade and other receivables 1 793 886 1 421 470

Cash and cash equivalents 7 482 084 4 221 065

9 275 970 5 642 535

8. Trade and Other ReceivablesAccrued income 1 778 534 1 259 337

Provision for Bad Debts (104 841) (118 558)

Other receivables 50 368 42 616

Value Added Taxation 69 826 238 074

1 793 886 1 421 470

The ageing of trade and other receivables at the reporting date

The ageing of accounts receivables are as follows:

30 days 118 383 460 638

60 days plus 1 675 503 960 831

1 793 886 1 421 470

9. Cash and Cash EquivalentsCash and cash equivalents consist of:

Cash on hand 2 503 3 621

Bank balances 318 345 121 065

Short-term deposits 7 161 236 4 096 379

7 482 084 4 221 065

10. Receivable from Related Party Fidelity Fund for Sheriffs – owing amount 2 064 520 2 819 269

The loan is unsecured, interest free and has no fixed terms of repayment.

11. Long-term LiabilitiesFinance lease liabilities

Vodacom Laptops - 7 175

Addition: Apple Mac - -

Less: Payments made - (7 175)

- -






12. Trade and Other PayablesTrade creditors 440 860 751 482

Accrued expenses 369 965 724 684

810 825 1 476 166

13. ProvisionsLeave provision 134 750 132 719

134 750 132 719

14. Financial Liabilities by Category The accounting policies for financial instruments have been applied to the line items below:

Financial liabilities by category

Trade and other payables 369 965 1 476 166

15. RevenueLevies received 6 681 450 5 647 941

Administrative fees received 11 574 751 10 429 309

18 256 201 16 077 250

Other income

Fines and penalties 165 000 135 228

Impairment of Assets/Liabilities 87 719 -

PSETA – Learnership Support 70 000 -

Royalties 81 327 -

SASSETA grants 43 828 -

447 874 135 228

18 704 075 16 212 478

The amounts included in revenue arising from exchange of goods or service are as follows:

Administrative fees received 11 574 751 10 429 309

Royalties 43 828 -

11 618 579 10 429 309

The amounts included in revenue arising from non-exchange transactions are as follows:

Levies received 6 681 450 5 647 941


Skills rebates – SASSETA 70 000 -

Royalties 81 327 -

6 997 777 5 783 169





16. Operating Surplus

Operating surplus for the year is stated after accounting for the following:

Lease rentals on operating lease 268 352 282 774

Depreciation on property, plant and equipment 342 500 369 765

Amortisation of intangible assets 181 650 187 274

Auditor’s remuneration 91 885 88 972

Consulting fees 171 218 596 159

Employee costs 8 937 001 7 840 897

17. Auditors Remuneration 91 885 88 972

Other services - -

Audit Fees 91 885 88 972

18. Investment RevenueInterest revenue

Current accounts 22 599 -

Customer accounts 27 061

Short-term deposits 344 331 351 806

393 991 351 806

19. TaxationNo provision has been made for 2017 taxation as the receipts and accruals to the entity are exempt from income tax in terms of section 10(1)cA)(i) of the Income Tax Act.

20. Cash Generated from OperationsSurplus for the year 4 070 025 209 993

Adjustments for:

Depreciation 342 500 369 765

Amortisation 181 650 187 274

Interest received (393 991) (351 806)

Finance costs 833 719 305

Changes in working capital:

Trade and other receivables (372 416) (403 228)

Provisions 2 031 (2 648 609)

Trade and other payables (665 341) 250 428

3 165 290 (1 666 879)






21. CommitmentsOperating leases – as lessee (office equipment and telephone systems)

Minimum lease payments due

- within one year 217 311 269 243

- in second to fifth year inclusive 289 749 628 234

507 060 897 477

22. Related PartiesRelationships

Common Board members Fidelity Fund for Sheriffs

The Sheriffs Board was established under the Sheriff’s Act and the Fidelity Fund is managed by the Board on behalf of the Minister of Justice. The Board enters into various transactions, on arm’s length with Fidelity Fund. The Board and the Fund had common board members for the year.

Related party balances

Receivable from related party

Fidelity Fund for Sheriffs 2 064 520 2 819 269

Administration fees charged to related party

Fidelity Fund for Sheriffs 11 574 751 10 429 309

The Administrative fee is based on the Sheriffs Act of 1986 as well as a Board Decision at what percentage the fee will be charged. This decision is then sanctioned by the Minister of Justice and Correctional Services.

23. Risk ManagementFinancial risk management

The entity’s activities expose it to a variety of financial risks: liquidity risk, interest rate risk and credit risk.

Liquidity risk

The entity’s risk to liquidity is a result of the funds available to cover future commitments. The entity manages liquidity risk through an on-going review of future commitments.

Cash is managed prudently by keeping sufficient cash in bank accounts. Cash is received from Sheriffs and the Fidelity Fund.

Interest rate risk

The Board has interest-bearing assets and the income and operating cash flows are substantially dependent on the changes in the market interest rates. The interest-bearing assets consist of short term investments with floating interest rate that expose the Board to cash flow interest rate risks. The interest rate used is based on the Prime rate.

Credit risk

Credit risk consists mainly of cash deposits, cash equivalents and trade debtors. The entity only deposits cash with major banks with high quality credit standing and limits exposure to any one counter-party.

Trade receivables comprise a widespread customer base. Management evaluated credit risk relating to customers on an on-going basis. If customers are independently rated, these ratings are used. Otherwise, if there is no independent rating, risk control assesses the credit quality of the customer, taking into account its financial position, past experience and other factors. Individual risk limits are set based on internal or external ratings in accordance with limits set by the board. The utilisation of credit limits is regularly monitored.




24. Going ConcernThe annual financial statements have been prepared on the basis of accounting policies applicable to a going concern. This basis presumes that funds will be available to finance future operations and that the realisation of assets and settlement of liabilities, contingent obligations and commitments will occur in the ordinary course of business.

25. Events after the Reporting DateThe Board is not aware of any matters or circumstances arising since the end of the financial year which significantly affect the financial position of the Board or the result of operations.

26. Public Finance Management ActIn a Board meeting held on the 15th October 2015, the Board resolved that the SABFS would no longer seeking listing in terms of the Public Finance Management Act (“PFMA”) schedules as required by S47(2) of the PFMA. The entity has therefore not been audited against the requirements of the PFMA, and the entity has therefore maintained its financial year for this reporting period as the end of February in terms of the Sheriffs Act.

27. Explanation of Variances between Actual and Budget

Finance, Administration and Compliance Division

The under recovery of 32.32% on this line item is due to an underspend on all the line items. The major contributor were consultancy fees.

Communication activities

The under recovery of 73.40% on this line item was due to the fact that certain activities planned for this year have not taken place due to prudency as well austerity measures implemented by the organisation.

Training

The under recovery of 17.62% on this line is due to the austerity measures implemented by the Board relating to training activities. Partnerships were formed with other organisations as well as making use of internal staff as well as venues from the department of Justice and Constitutional Development.

General operations - depreciation

The over recovery of 54.16% on this line item relates to the depreciation which were under provided for in the budget in the current financial year. This was due to the changes that took place after the budget were approved.

Contracts i.e. Cleaning and office maintenance

The under recovery of 6.65% on this line item is due to the increase in the under recovery in cleaning and security expenses.

Other general office expenditure

This over recovery of 31.14% on this line item is due to increase of more than 100% in recruitment expenses, increase of 49% in stationery due to increase numbers in staff and printing of pocket sheriff guides and increase in telephone expenses due to increase in staff.

Personnel expenditure

The over recovery of 5.28% in this line item is due to the salary increase awarded as well as savings due to vacant positions.

Staff development

The under recovery of 45.19% in this line item was due to the SABFS making use of internal resources to provide the necessary training in terms of the approved performance workplans for the year. These measures were part of the austerity measures implemented by the organisation.

Contingency

The under recovery of 100% in this line item is directly related to other savings incurred during the financial year.







28. Executive Management and Board Member’s RemunerationThe following persons are employed by the Board in their respective executive capacities during the financial year.

Executive Management remuneration

S Snell Executive Manager 850 951 478 152

V Botha Legal And Complaints Manager (resigned 30 November 2016) 549 206 402 802

BZ Luthuli HR & Compliance Manager 521 441 574 606

VP Nel Training and Communication Manager 514 043 492 262

AC Simon General Manager Corporate and Financial Services 697 118 603 712

3 132 758 2 551 534

Board Members emoluments (non-executive) 2017 2016

Allowances Reimbursement of expenses

Allowances Reimbursement of expenses

C. Mabuza 58 368 54 289 71 933 61 344

H. Mohamed - - - -

P. Roodt 84 120 6 096 92 987 3 498

T. Tembe 84 784 8 125 78 646 3 287

N. Soga 52 200 3 739 48 544 501

S. Skosana - - 14 956 564

K. Sigenu 52 736 11 593 - -

M. Magida 93 184 1 399 69 978 1 368

M. Lephadi 56 520 7 636 54 959 6 554

LD. Fernandez 48 960 458 49 680 408

L. Mashapa - 1 800 2 978 441

I. Klynsmith 81 064 32 651 63 458 27 426

G. Cronje – Independent Chairperson of Audit Committee

41 090 - 35 023 -

N. Nxumalo - - - 1 095

653 026 127 786 583 142 106 485

29. VAT Ruling ImpactValue Added Taxation (VAT)

Net surplus as per Income statement 4 070 025 209 993

Vat apportionment adjustment - Interest & fines - 719 022

Surplus for the year 4 070 025 929 015

30. ContingenciesTrade Creditor

An amount of R100,000 owing to a service provider during the purchase of the building, 88 Loop Street have been reversed due to the nature of the long outstanding debt under trade creditors. The amount have not yet prescribed, but in compliance with GRAP, the amount were reversed.



DETAILED STATEMENT OF FINANCIAL PERFORMANCE FOR THE YEAR ENDED 28 FEBRuARY 2017


Revenue

Levies received 6 681 450 5 647 941

Administrative fees 11 574 751 10 429 309

Income 15 18 256 201 16 077 250

Other income


Impairment of Assets/Liabilities 87 719 -

PSETA - Learnership Support 70 000 -

Royalties 81 327 -

Skills rebates - SASSETA 43 828 -

15 447 874 135 228

Operating income 18 704 075 135 228

Investment income 18 393 991 351 806

Total revenue 19 098 066 16 564 284





Operating expenses

Accommodation 17 327 466 214 265


Bad Debts (13 716) (11 638)

Bank charges 49 472 36 255

Catering expenses 144 958 135 281

Cleaning 75 969 69 689

Communication and public education 105 913 295 072

Consulting fees 171 218 596 159

Criminal and credit clearance 21 174 17 815

DC & Inspections 45 731 202 344


Electricity and water 142 129 121 624

Employee costs 8 937 001 7 840 897

Finance Charges 833 719 305

Gifts 19 135 21 440

IT expenses 58 112 71 411

Insurance 128 936 123 360

Lease rentals on operating lease 268 352 282 774

Legal fees 220 421 982 271

Parking expenses 53 146 53 890

Postage 235 400 174 112

Printing and stationery 512 286 729 602

Recruitment expenses 294 845 279 515

Repairs and maintenance 164 668 202 836

Security 6 129 6 595

Staff welfare 118 053 116 255

Subscriptions 55 609 118 557

Telephone and fax 275 234 286 903

Training 800 195 918 172

Travel – local 1 193 337 1 103 520

15 028 041 16 354 291

Surplus for the year 4 070 025 209 993

DETAILED STATEMENT OF FINANCIAL PERFORMANCE FOR THE YEAR ENDED 28 FEBRuARY 2017 (Continued)

FIDELITY FUND FOR SHERIFFSANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 28 FEBRUARY 2017

FIDELITY FUND FOR SHERIFFSEstablished in Terms of the Sheriffs Act 90 of 1986, as Amended

The monies accrued in the Fund are invested in property and in various banks. Its capital is guaranteed and interest accrued therein is re-invested to keep the Fund fluid. – Petro Roodt

FIDELITY FUND FOR SHERIFFSANNUAL FINANCIAL STATEMENTS



annuaL finanCiaL stateMentsfor tHe Year ended 28 feBruarY 2017

CONTENTS PAGEStatement of Board’s Responsibilities and Approval 66

Independent Auditor’s Report 67-69

Board Members’ Report 70

Statement of Financial Position 71

Statement of Financial Performance 72

Statement of Changes in Net Assets 73

Cash Flow Statement 74

Statement of Comparison of Budget and Actual Amounts 75

Accounting Policies 76-81

Notes to the Annual Financial Statements 82-88

The following supplementary information does not form part of the annual financial statements

and is unaudited:

Detailed Statement of Financial Performance 89



STATEMENT OF BOARD’S RESPONSIBILITY AND APPROVAL

The Board is required by the Sheriffs Act, No. 90 of

1986, to maintain adequate accounting records and is

responsible for the content and integrity of the annual

financial statements and related financial information included

in this report. It is the responsibility of the Board to ensure that

the annual financial statements fairly present the state of affairs

of the entity as at the end of the financial year and the results

of its operations and cash flows for the period then ended. The

external auditors are engaged to express an independent opinion

on the annual financial statements and were given unrestricted

access to all financial records and related data.



Practice (GRAP) including any interpretations, guidelines and

directives issued by the Accounting Standards Board.

The annual financial statements are based on appropriate

accounting policies consistently applied and supported by

reasonable and prudent judgments and estimates. The Board

acknowledges that it is ultimately responsible for the system

of internal financial control established by the entity and place

considerable importance on maintaining a strong control

environment. To enable the Board to meet these responsibilities,

the Board sets standards for internal control aimed at reducing

the risk of error or deficit in a cost-effective manner. The

standards include the proper delegation of responsibilities within

a clearly defined framework, effective accounting procedures

and adequate segregation of duties to ensure an acceptable

level of risk. These controls are monitored throughout the entity

and all employees are required to maintain the highest ethical

standards in ensuring the entity’s business is conducted in a

manner that in all reasonable circumstances is above reproach.

The focus of risk management in the entity is on identifying,

assessing, managing and monitoring all known forms of risk

across the entity. While operating risk cannot be fully eliminated,

the entity endeavours to minimise it by ensuring that appropriate

infrastructure, controls, systems and ethical behaviour are

applied and managed within predetermined procedures and

constraints.

The members are of the opinion, 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 annual financial

statements. However, any system of internal financial control

can provide only reasonable, and not absolute, assurance

against material misstatement or deficit.

The Board has reviewed the entity’s cash flow forecast for the

year to 28 February 2018 and, in the light of this review and

the current financial position, it is satisfied that the entity has

or has access to adequate resources to continue in operational

existence for the foreseeable future. The annual financial

statements are prepared on the basis that the entity is a going

concern and that the Board has neither the intention nor the

need to liquidate or curtail materially the scale of the entity.

Although the Board is primarily responsible for the financial

affairs of the entity, it is supported by the entity’s external

auditors.

The external auditors are responsible for independently reviewing

and reporting on the entity’s annual financial statements. The

annual financial statements have been examined by the entity’s

external auditors and their report is presented on pages 67 to 69.

The annual financial statements with selected notes set out on

pages 70 to 89, which have been prepared on the going-concern

basis, were approved by the Board on 27 July 2017 and were

signed on its behalf by:

MRS. C MABUzA Chairperson of the Board

MS. K SIGENU Chairperson: Finance Committee

MRS. S SNELL Executive Manager




INDEPENDENT AuDITORS’ REPORTTo the Minister of Justice and Correctional Services

OpinionWe have audited the annual financial statements of the Fidelity

Fund for Sheriffs, which comprise the statement of financial

position as at 28 February 2017, the statement of comprehensive

income, statement of changes in funds and statement of cash

flows and statement of comparison of budget and actual

amounts for the year then ended, and a summary of significant

accounting policies and other explanatory notes, as set out on

pages 70 to 88.

In our opinion, the annual financial statements present fairly, in

all material respects, the financial position of the Fidelity Fund

for Sheriffs as at 28 February 2017, its financial performance

and its cash flows and statement of comparison of budget and

actual amounts for the year then ended, in accordance with the

South African Standards of Generally Recognised Accounting

Practice (GRAP) and the requirements of the Sheriffs Act No. 90

of 1986, as amended.

Basis for OpinionWe conducted our audit in accordance with International

Standards on Auditing (ISAs) and the Public Audit Act of

South Africa, 2004 (Act No. 25 of 2004) (PAA), and the general

notice issued in terms thereof. Our responsibilities under those

standards are further described in the Auditor’s Responsibilities

section of our report. We are independent of the Fidelity Fund

for Sheriffs in accordance with IRBA requirements which are

in accordance with International Ethics Standards Board for

Accountant’s Code of Ethics for Professional Accountants

(IESBA Code).

We believe that the audit evidence we have obtained is sufficient

and appropriate to provide a basis for our opinion.

Key Audit MattersKey audit matters are those matters that, in our professional

judgement, were of most significance in our audit of the annual

financial statements of the current period. No such matters were

identified during the audit.

Other Supplementary InformationWe draw attention to the fact that supplementary information

set out on page 91 does not form part of the annual financial

statements and is presented as additional information.

We have not audited this information and accordingly do not

express an opinion thereon

The Board of Director’s Responsibility for the Annual Financial StatementsThe members of the Board are responsible for the preparation

and fair presentation of these annual financial statements in


Recognised Accounting Practices and the requirements of the

Sheriffs Act No. 90 of 1986, as amended, and the Public Audit

Act, 2004 ( Act No. 25 of 2004).

This responsibility includes: designing, implementing and

maintaining internal control relevant to the preparation and fair

presentation of annual financial statements that are free from

material misstatement, whether due to fraud or error; selecting

and applying appropriate accounting policies; and making

accounting estimates that are reasonable in the circumstances.

Head Office20 Morris Street East, Woodmead, 2191

P.O.Box 2939, Saxonwold, 2132Tel: +27 (0) 11 231 0600Fax: +27 (0) 11 234 0933

Cape Town32 Century Boulevard, Block A, 2nd Floor

Century Falls, Cape Town, 7441P.O. Box 15565, Vlaeberg, 8018

Tel: +27 (0) 21 552 5311Fax: +27 (0) 21 552 2805

Victor Sekese (Chief Executive)A comprehensive list of all Directors is available at the company offices or registered office.

SizweNtsalubaGobodo Incorporated. Registration Number: 2005/034639/21




is responsible for assessing the entity’s ability to continue as

a going concern, disclosing, as applicable, matters related to

going concern and using the going concern basis of accounting

unless management either intends to liquidate the entity or

cease operations, or has no realistic alternative but to do so.

Auditor’s ResponsibilityOur 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 our opinion.

Reasonable assurance is a high level of assurance, but is not

a guarantee that an audit conducted in accordance with 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 the aggregate, they could reasonably

be expected to influence the economic decisions of users taken

on the basis of these annual financial statements.

As part of an audit in accordance with ISAs, we exercise

professional judgement and maintain professional scepticism

throughout the audit. We also:

• Identify and assess the risks of material misstatement of

the annual 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 of our 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 override 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 Fund’s

internal control.

• Evaluate the appropriateness of accounting policies used

and the reasonableness of accounting estimates and

related disclosures made by management.

• Conclude on the appropriateness of management’s use of

the going concern basis of accounting and, based on the

audit evidence obtained, whether a material uncertainty

exists related to events or conditions that may cast

significant doubt on the Fund’s ability to continue as a going

concern. If we conclude that a material uncertainty exists,

we are required to draw attention in our auditors report to

the related disclosures in the annual financial statements or,

if such disclosures are inadequate, to modify our opinion.

Our conclusions are based on the audit evidence obtained

up to the date of our auditor’s report. However, future events

or conditions may cause the Fund to cease to continue as

a going concern.

• Evaluate the overall presentation, structure and content of

the annual financial statements, including the disclosures,

and whether the annual financial statements represent

the underlying transactions and events in a manner that

achieves fair presentation.

We communicate with those charged with governance regarding,

among other matters, the planned scope and timing of the

audit and significant audit findings, including any significant

deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement

that we have complied with relevant ethical requirements regarding

independence, and to communicate with them all relationships

and other matters that may reasonably be thought to bear on our

independence, and where applicable, related safeguards.

Report on Other Legal and Regulatory RequirementsIn accordance with the PAA and the General Notice issued

in terms thereof, we report the following findings on the

performance information against predetermined objectives,

non-compliance with legislations as well as internal control.

We performed tests to identify reportable findings as described

under each subheading but not to gather evidence to express

assurance on these matters. Accordingly, we do not express an

opinion or conclusion on these matters.






Predetermined ObjectivesWe did not audit performance against predetermined objectives,

as the entity is not required to prepare a report on its performance

against predetermined objectives. The entity does not fall within

the ambit of the PFMA and the entity-specific legislation does

not require reporting on performance against predetermined

objectives. There are no matters to report.

Compliance with LegislationWe performed procedures to obtain evidence that the South

African Board for Sheriffs had complied with legislation

regarding financial matters, financial management and other

related matters. We did not identify any instances of material

non-compliance with specific matters in key legislation, as set

out in the general notice issued in terms of the PAA.

Internal ControlWe considered internal control relevant to our audit of the

financial statements, annual performance report and compliance

with legislation. We did not identify any significant deficiencies

in internal control.

SizweNtsalubaGobodo Inc.

Director: Natalie Arendse

Registered Auditor

Date: 31 July 2017

2nd Floor, Block A, Century Falls,

32 Century Boulevard, Century City

Cape Town

7441



BOARD MEMBERS’ REPORTThe Board members submit their report for the year ended 29 February 2016.

1. Review of Activities: Main Business and Operations

The Fidelity Fund for Sheriffs (the Fund) is engaged and

governed in terms of the Sheriff’s Act, No.90 of 1986. The

Fund is controlled and managed by the South African Board for

Sheriffs (the Board), which shall utilise the money in the Fund in

accordance with the Sheriffs Act, No. 90 of 1986.

The operating results and state of affairs of the entity are fully set

out in the attached annual financial statements and do not, in

our opinion, require any further comment.

2. Going ConcernThe annual financial statements have been prepared on the

basis of accounting policies applicable to a going concern. This

basis presumes that funds will be available to finance future

operations and that the realisation of assets and settlement of

liabilities, contingent obligations and commitments will occur in

the ordinary course of business.

3. Events after the Reporting PeriodThe Board members are not aware of any matter or circumstances

arising since the end of the financial year that would materially

impact on the financial position of the entity.

4. Public Finance Management ActIn a Board meeting held on the 15th October 2015, the Board

resolved that the SABFS would no longer seeking listing in terms

of the Public Finance Management Act (“PFMA”) schedules as

required by S47(2) of the PFMA. The Board has further resolved

that it will adopt and implement the principles of the PFMA into

its policies where it is economical and practical to do so.

5. Board MembersThe Board members during the year and to the date of this

report are:

NAME CHANGES

C. Mabuza (Chairperson) Re-appointed 1 March 2015

H. Mohamed Re-appointed 1 March 2015

T. Tembe Re-appointed 1 March 2015

P. Roodt Re-appointed 1 March 2015

N. Soga Appointed 1 March 2015

M. Lephadi Appointed 1 March 2015

I. Klynsmith Appointed 1 March 2015

L. Mashapa Appointed 1 March 2015

L. Fernandez Appointed 1 March 2015

M. Magida Appointed 1 March 2015

K. Sigenu Appointed 1 May 2016




STATEMENT OF FINANCIAL POSITION AS AT 28 FEBRuARY 2017


Assets

Current Assets

Trade and other receivables 6 304 564 349 974

Cash and cash equivalents 7 30 148 409 30 652 489

30 452 973 31 002 463

Non-Current Assets

Investment in Property 4 11 811 727 12 052 783

Investments held to maturity 7 96 374 639 83 479 808

108 186 366 95 532 591

Total Assets 138 639 339 126 535 054

Non-Current Liabilities

Trust account balances 9 2 833 000 2 833 000

Current Liabilities

Trade and other payables 10 3 295 587 218 293

Payable to related party 8 2 064 520 2 819 269

Provisions 12 - 1 100 790

Total Liabilities 8 193 107 6 971 352

Net Assets 130 446 232 119 563 702

Net Assets

Accumulated Surplus 129 969 280 119 086 750

Non-Distributable reserve 476 952 476 952

Total Net Assets 130 446 232 119 563 702



STATEMENT OF FINANCIAL PERFORMANCEFOR THE PERIOD ENDED 28 FEBRuARY 2017


Revenue 13 16 576 330 15 083 503

Operating expenses (15 901 220) (10 677 436)

Operating surplus 14 675 110 4 406 067

Investment revenue 10 207 420 7 357 200





STATEMENT OF CHANGES IN NET ASSETSFOR THE YEAR ENDED 28 FEBRuARY 2017

Figures in RandAccumulated

surplusNDR - Revaluation

Reserve Total net assets

Balance at 01 March 2015 107 323 483 - 107 323 483


Surplus for the year 11 763 267 476 952 12 240 219

Balance at 01 March 2016 119 086 750 476 952 119 563 702


Surplus for the year 10 882 530 - 10 882 530

Balance at 28 February 2017 129 969 280 476 952 130 446 232



CASH FLOW STATEMENTFOR THE YEAR ENDED 28 FEBRuARY 2017


Cash flows from operating activities

Receipts

Receipts from sheriffs and SABFS 16 056 869 23 017 269

Less cash payments to suppliers and SABFS (13 118 789) (20 720 035)

Net cash from operating activities 16 2 938 080 2 297 234

Cash flows from investing activities

Interest income 10 207 420 7 357 200

Movement in Investment held to maturity (12 894 831) (4 234 166)

Movement in Payable to related party (754 749) 932 303

Net cash flows from investing activities (3 442 160) 4 055 336

Net increase in cash and cash equivalents (504 080) 6 352 570

Cash and cash equivalents at the beginning of the year 30 652 489 24 299 919

Cash and cash equivalents at the end of the year 7 30 148 409 30 652 489




STATEMENT OF COMPARISON OF BuDGET AND ACTuAL AMOuNTSFOR THE YEAR ENDED 28 FEBRuARY 2017

Figures in Rand Note Approved

budgetActual amounts on comparable basis

Difference between budget and actual Note

Revenue

Fidelity fund certificates 400 000 493 602 93 602 21

Interest income - Trust Accounts 13 200 000 16 082 728 2 882 728 21

Interest income - Investments 6 500 000 10 207 420 3 707 420 21

Total revenue 20 100 000 26 783 750 6 683 750 21

Operating Expenses

Administration fees 10 500 000 11 574 751 (1 074 751) 21

Audit fees 60 000 50 000 10 000 21

Bad Debts - 4 579 (4 579) 21

Bank Charges 10 000 7 423 2 577 21

Building maintenance 500 000 - 500 000 21

Claims against the Fidelity Fund 22 1 500 000 1 996 279 (496 279) 21

Consulting fees 400 000 - 400 000 21

Depreciation 300 000 241 056 58 944 21

Disciplinary Inquiries & Inspections 100 000 145 627 (45 627) 21

Insurances 1 558 600 1 001 005 557 595 21

Legal fees 400 000 708 480 (308 480) 21

Utilities 150 000 172 020 (22 020) 21

Total expenses 15 478 600 15 901 220 (422 620) 21

Net Surplus 4 621 400 10 882 530 (6 261 130) 21



ACCOuNTING POLICIES

1. Presentation of Annual Financial Statements


accordance with the effective Standards of Generally Recognised

Accounting Practice (GRAP) including any interpretations,

guidelines and directives issued by the Accounting Standards

Board. These annual financial statements have been prepared

on an accrual basis of accounting and are in accordance with

historical cost convention unless specified otherwise. They are

presented in South African Rand.

A summary of the significant accounting policies, which have

been consistently applied, are disclosed below.

1.1 Significant Judgements and Sources of Estimation Uncertainty


is required to make estimates and assumptions that affect

the amounts represented in the annual financial statements

and related disclosures. Use of available information and the

application of judgement is inherent in the formation of estimates.

Actual results in the future could differ from these estimates

which may be material to the annual financial statements.

Significant judgements include:

Trade receivablesThe entity assesses its trade receivables for impairment at

the end of each reporting period. In determining whether an

impairment loss should be recorded in surplus or deficit, the

entity makes judgements as to whether there is observable data

indicating a measurable decrease in the estimated future cash

flows from a financial asset.

The impairment for trade receivables is calculated on a portfolio

basis, based on historical loss ratios, adjusted for national and

industry specific economic conditions and other indicators

present at the reporting date that correlate with defaults on the

portfolio. These annual loss ratios are applied to loan balances in

the portfolio and scaled to the estimated loss emergence period.

Fair value estimationThe carrying value less impairment provision of trade receivables

and payables are assumed to approximate their fair values.

ProvisionsProvisions were raised and management determined an estimate

based on the information available. Additional disclosures of

these estimates of provisions are included in note 12.

Effective interest rateThe entity used the prime interest rate to discount future cash

flows.

Allowance for doubtful debtsOn debtors an impairment loss is recognised in surplus and

deficit when there is objective evidence that it is impaired. The

impairment is measured as the difference between the debtors

carrying amount and the present value of estimated future cash

flows discounted at the effective interest rate, computed at initial

recognition. A provision for bad/doubtful debts are provided in

terms of the policy of the SABFS.

1.2 Property, Plant and EquipmentProperty, plant and equipment are tangible non-current 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 period.

The cost of an item of property, plant and equipment is

recognised as an asset when:

• it is probable that future economic benefits or service

potential associated with the item will flow to the entity;

and

• the cost of the item can be measured reliably.

Property, plant and equipment is initially measured at costThe 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 management. Trade

discounts and rebates are deducted in arriving at the cost.

Where an asset is acquired at no cost, or for a nominal cost, its

cost is its fair value as at date of acquisition.





Costs include costs incurred initially to acquire an item of

property, plant and equipment and costs incurred subsequently

to add to, replace part of, or service it. If a replacement cost is

recognised in the carrying amount of an item of property, plant

and equipment, the carrying amount of the replaced part is

derecognised.

Recognition of costs in the carrying amount of an item of

property, plant and equipment ceases when the item is in the

location and condition necessary for it to be capable of operating

in the manner intended by management.

Measurement Subsequent to initial recognition PropertyAfter recognition as an asset, Property whose fair value can be

measured reliably shall be carried at a revalued amount, being

its fair value at the date of the revaluation less any subsequent

accumulated depreciation and subsequent accumulated

impairment losses. Revaluations shall be made with sufficient

regularity to ensure that the carrying amount does not differ

materially from that which would be determined using fair value

at the reporting date. Property will be revalued every 3 years.

The useful live of items of property have been assessed as

follows:


Property 50 years

The residual value, the useful life and depreciation method of

each asset are reviewed at the end of each reporting date. If

the expectations differ from previous estimates, the change is

accounted for as a change in accounting estimate.

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.

The depreciation charge for each period is recognised in surplus

or deficit unless it is included in the carrying amount of another

asset.

Items of property, plant and equipment 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 from the derecognition of an item of

property, plant and equipment is included in surplus or deficit

when the item is derecognised. The gain or loss arising from

the derecognition of an item of property, plant and equipment is

determined as the difference between the net disposal proceeds,

if any, and the carrying amount of the item.

1.3 Financial Instruments

ClassificationThe entity classifies financial assets and financial liabilities into

the following categories:

• Financial instruments at fair value;

• Financial instruments at amortised costs; and

• Financial instruments at cost.

Initial recognition and measurementFinancial instruments are recognised initially when the entity

becomes a party to the contractual provisions of the instruments.

The entity classifies financial instruments, or their component

parts, on initial recognition as a financial asset, a financial liability

or an equity instrument in accordance with the substance of the

contractual arrangement.

Financial instruments are measured initially at fair value, except

for equity investments for which a fair value is not determinable,

which are measured at cost and are classified as available for

sale financial assets.

Subsequent measurementLoans and receivables are subsequently measured at amortised

cost, using the effective interest method, less accumulated

impairment losses.

Financial liabilities at amortised cost are subsequently measured

at amortised cost, using the effective interest method.

Impairment of financial assetsAt each end of the reporting period the entity assesses all

financial assets, other than those at fair value through surplus

or deficit, to determine whether there is objective evidence that

a financial asset or group of financial assets has been impaired.

For amounts due to the entity, significant financial difficulties of

the debtor, probability that the debtor will enter bankruptcy and

default of payments are all considered indicators of impairment.




Where financial assets are impaired through use of an allowance

account, the amount of the loss is recognised in surplus or

deficit within operating expenses. When such assets are written

off, the write off is made against the relevant allowance account.

Subsequent recoveries of amounts previously written off are

credited against operating expenses.

Trade and other receivablesTrade receivables are measured at initial recognition at fair value,

and are subsequently measured at amortised cost using the

effective interest rate method.

Appropriate allowances for estimated irrecoverable amounts are

recognised in surplus or deficit when there is objective evidence

that the asset is impaired. Significant financial difficulties of

the debtor, probability that the debtor will enter bankruptcy or

financial reorganisation, and default or delinquency in payments

(more than 30 days overdue) are considered indicators that the

trade receivable is impaired.

The allowance recognised is measured as the difference

between the asset’s carrying amount and the present value of

estimated future cash flows discounted at the effective interest

rate computed at initial recognition.

The carrying amount of the asset is reduced through the use

of an allowance account, and the amount of the deficit is

recognised in surplus or deficit within operating expenses. When

a trade receivable is uncollectible, it is written off against the

allowance account for trade receivables. Subsequent recoveries

of amounts previously written off are credited against operating

expenses in surplus or deficit.

Trade and other receivables are classified as loans and

receivables.

Trade and other payablesTrade payables are initially measured at fair value, and are

subsequently measured at amortised cost, using the effective


Cash and cash equivalentsCash and cash equivalents comprise cash on hand and demand

deposits and other short term highly liquid investments that are

readily convertible to a known amount of cash and are subject

to an insignificant risk of changes in value. These are initially

recorded at fair value and subsequently recorded at amortised

cost.

1.4 Provisions and ContingenciesProvisions are recognised when:

• the entity has a present obligation as a result of a past

event;

• 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 amount of a provision is the best estimate of the expenditure

expected to be required to settle the present obligation at the

reporting date.

Where some or all of the expenditure required to settle a

provision is expected to be reimbursed by another party, the

reimbursement is recognised when, and only when, it is virtually

certain that reimbursement will be received if the entity settles

the obligation. The reimbursement is treated as a separate

asset. The amount recognised for the reimbursement does not

exceed the amount of the provision.

Provisions are not recognised for future operating deficits.

Contingent assets and contingent liabilities are not recognised.

Contingencies are disclosed in note 24.

1.5 Revenue from Exchange TransactionsRevenue is the gross inflow of economic benefits or service

potential during the reporting period when those inflows result

in an increase in net assets, other than increases relating to

contributions from owners.

An exchange transaction is one in which the entity receives

assets or services, or has liabilities extinguished, and directly

gives approximately equal value (primarily in the form of goods,

services or use of assets) to the other party in exchange.

Fair value is the amount for which an asset could be exchanged,

or a liability settled, between knowledgeable, willing parties in

an arm’s length transaction. An exchange transaction will be

recognised as and when the Fund receives a declaration from

the sheriffs.





MeasurementRevenue is measured at the fair value of the consideration

received or receivable, net of trade discounts and volume

rebates.

Sale of goodsRevenue from the sale of goods is recognised when all the

following conditions have been satisfied:

• the entity has transferred to the purchaser the significant

risks and rewards of ownership of the goods;

• the entity retains neither continuing managerial

involvement to the degree usually associated with

ownership nor effective control over the goods sold;




entity; and

• the costs incurred or to be incurred in respect of the

transaction can be measured reliably.

Rendering of servicesWhen 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:




entity;

• 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.

InterestRevenue arising from the use by others of entity assets yielding

interest, royalties and dividends is recognised when:

• It is probable that the economic benefits or service


entity, and

• The amount of the revenue can be measured reliably.

Interest is recognised, in surplus or deficit, using the effective

interest rate method. Interest as revenue will be recognised

when a declaration is received from a sheriff along with an

auditor’s report.

Investment income will be recognised as and when the Fund

becomes entitled to the income.

1.6 Revenue from Non-Exchange TransactionsRevenue comprises gross inflows of economic benefits or

service potential received and receivable by an entity, which

represents an increase in net assets, other than increases

relating to contributions from owners.

Conditions on transferred assets are stipulations that specify

that the future economic benefits or service potential embodied

in the asset is required to be consumed by the recipient as

specified or future economic benefits or service potential must

be returned to the transferor.

Control of an asset arises when the entity can use or otherwise

benefit from the asset in pursuit of its objectives and can exclude

or otherwise regulate the access of others to that benefit.

Non-exchange transactions are transactions that are not

exchange transactions. In a non-exchange transaction, an entity

either receives value from another entity without directly giving

approximately equal value in exchange, or gives value to another

entity without directly receiving approximately equal value in

exchange.

Restrictions on transferred assets are stipulations that limit or

direct the purposes for which a transferred asset may be used,

but do not specify that future economic benefits or service

potential is required to be returned to the transferor if not

deployed as specified.

Stipulations on transferred assets are terms in laws or regulations,

or a binding arrangement, imposed upon the use of a transferred

asset by entities external to the reporting entity.

RecognitionAn inflow of resources from a non-exchange transaction

recognised as an asset is recognised as revenue, except to the




extent that a liability is also recognised in respect of the same

inflow.

As the entity satisfies a present obligation recognised as a

liability in respect of an inflow of resources from a non-exchange

transaction recognised as an asset, it reduces the carrying

amount of the liability recognised and recognises an amount of

revenue equal to that reduction.

MeasurementRevenue from a non-exchange transaction is measured at the

amount of the increase in net assets recognised by the entity.

When, as a result of a non-exchange transaction, the entity

recognises an asset, it also recognises revenue equivalent to the

amount of the asset measured at its fair value as at the date

of acquisition, unless it is also required to recognise a liability.

Where a liability is required to be recognised it will be measured

as the best estimate of the amount required to settle the

obligation at the reporting date, and the amount of the increase

in net assets, if any, recognised as revenue.

When a liability is subsequently reduced, because the taxable

event occurs or a condition is satisfied, the amount of the

reduction in the liability is recognised as revenue.

1.7 Comparative FiguresWhere necessary, comparative figures have been reclassified to

conform to changes in presentation in the current year.

1.8 Irregular, Fruitless and Wasteful ExpenditureIrregular expenditure means expenditure which was made

in contravention of the SABFS policies and procedures as

approved by the Board.

Fruitless expenditure means expenditure which was made in

vain and would have been avoided had reasonable care been

exercised.

All expenditure relating to fruitless and wasteful 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.

1.9 Budget InformationThe entity is typically subject to budgetary limits in the form

of budget authorisations (or equivalent), which is given effect

through Board resolutions or similar.

General purpose financial reporting by entity shall provide

information on whether resources were obtained and used in

accordance with the legally adopted budget.

The annual financial statements and the budget are not on the

same basis of accounting therefore a reconciliation between the

statement of financial performance and the budget have been

included in the annual financial statements. Refer to note 21.

1.10 Related PartiesThe objective of this standard is to ensure that a reporting

entity’s financial statements contain the disclosures necessary

to draw attention to the possibility that its financial position and

surplus or deficit may have been affected by the existence of

related parties and by transactions and outstanding balances

with such parties.

An entity that prepares and presents financial statements under

the accrual basis of accounting (in this standard referred to as

the reporting entity) shall apply this standard in:

• identifying related party relationships and transactions;

• identifying outstanding balances, including commitments,

between an entity and its related parties;

• identifying the circumstances in which disclosure of the

items in (a) and (b) is required; and

• determining the disclosures to be made about those

items.

This standard requires disclosure of related party relationships,

transactions and outstanding balances, including commitments,

in the consolidated and separate financial statements of the

reporting entity in accordance with the Standard of GRAP on

Consolidated and Separate Financial Statements. This standard

also applies to individual financial statements.

Disclosure of related party transactions, outstanding balances,

including commitments, and relationships with related parties

may affect users’ assessments of the financial position and

performance of the reporting entity and its ability to deliver agreed

services, including assessments of the risks and opportunities

facing the entity. This disclosure also ensures that the reporting

entity is transparent about its dealings with related parties.





The standard states that a related party is a person or an entity

with the ability to control or jointly control the other party, or

exercise significant influence over the other party, or vice versa,

or an entity that is subject to common control, or joint control.

As a minimum, the following are regarded as related parties of

the reporting entity:

• A person or a close member of that person’s family is

related to the reporting entity if that person;

• has control or joint control over the reporting entity;

• has significant influence over the reporting entity and

• is a member of the management of the entity or its

controlling entity.

An entity is related to the reporting entity if any of the following

conditions apply:

• the entity is a member of the same economic entity (which

means that each controlling entity, controlled entity and

fellow controlled entity is related to the others);

• one entity is an associate or joint venture of the other

entity (or an associate or joint venture of a member of an

economic entity of which the other entity is a member);

• both entities are joint ventures of the same third party;

• one entity is a joint venture of a third entity and the other

entity is an associate of the third entity;

• the entity is a post-employment benefit plan for the benefit

of employees of either the entity or an entity related to

the entity. If the reporting entity is itself such a plan, the

sponsoring employers are related to the entity;

• the entity is controlled or jointly controlled by a person

identified in (a); and

• a person identified in (a)(i) has significant influence over that

entity or is a member of the management of that entity (or

its controlling entity).

The standard furthermore states that a related party transaction

is a transfer of resources, services or obligations between the

reporting entity and a related party, regardless of whether a price

is charged.

The standard elaborates on the definitions and identification of:

• Close member of the family of a person;

• Management;

• Related parties;

• Remuneration; and

• Significant influence.

2. Changes in Accounting PolicyThe annual financial statements have been prepared in


Practice on a basis consistent with the prior year.

3. New Standards and Interpretations

3.1 Adoption of New and Revised Standards and Interpretations Issued and Effective

During the current year, the entity has adopted all new and revised

standards and interpretations, which have been published and

are mandatory for the entity’s accounting periods beginning on

or after 01 April 2016.

The following standards were effective for the first time for

financial statements covering periods beginning 1 April 2015,

however, these standards were not applicable to the entity:

• GRAP 18 Segment reporting

• GRAP 105 Transfers of functions between entities under

common control

• GRAP 106 Transfers of functions between entities not

under common control

• GRAP 107 Mergers

3.2 Adoption of New and Revised Standards And Interpretations Issued, but not yet Effective

The following standards were issued, but were not yet effective

for the 2017 financial year-end:

• GRAP 32 Service concession arrangements: Grantor

• GRAP 108 Statutory receivables

• GRAP 109 Accounting by principals and agents

• GRAP 110 Living and Non-living Resources



NOTES TO THE ANNuAL FINANCIAL STATEMENTS

4. Property, Plant and Equipment 2017 2016

Revalued Amount

Accumulated Depreciation

Carrying value


Carrying value

Investment in Property 12 052 783 (241 056) 11 811 727 12 052 783 - 12 052 783

Opening balance


Revaluation Reserve

Closing Balance

Reconciliation of property, plant and equipment – 2017

Investment in Property 12 052 783 - - (241 056) - 11 811 727

Opening balance


Revaluation Reserve

Closing Balance

Reconciliation of property, plant and equipment – 2016

Investment in Property 11 818 388 - - (242 558) 476 952 12 052 783

Details of property 2017 2016

The property is situated at 88 Loop Street Cape Town

– Purchase price 13 370 326 13 370 326

– South African Board for Sheriffs (1 242 429) (1 242 429)

Total Cost 28 February 2015 12 127 897 12 127 897

less Accumulated Depreciation at 29 February 2016 (552 066) (552 066)

add Revaluation at 29 February 2016 476 952 476 952

Total Revalued amount/Cost 29 February 2016 12 052 783 12 052 783

The Investment in Property represent the 10% of the value of the Fidelity Funds assets at the date of purchase of the Property at 88 Loop Street, Cape Town at the 31 July 2013. A Valuation of the property was undertaken by Powells , Asset Valuation and disposals on the 25th February 2016. The portion reflected is the portion related to the fidelity fund only. The property was valued at R13,750,000






5. Financial Assets by CategoryThe accounting policies for financial instruments have been applied to the line items below:

Loans and receivables

Trade and other receivables 304 564 349 974

Investments held to maturity 96 374 639 83 479 808

Cash and cash equivalents 30 148 409 30 652 489

126 827 612 114 482 271

6. Trade and Other ReceivablesTrade Receivables 276 263 245 736

Provision for bad debts (41 439) (36 860)

Accrued income 68 025 115 792

SARS VAT 1 715 25 306

304 564 349 974

The ageing of trade and other receivables at the reporting date

The ageing of accounts receivables are as follows:

30 days 98 469 -

90 days plus 206 095 349 974

304 564 349 974

7. Cash and Cash EquivalentsCash and cash equivalents consist of:

Bank balances 30 148 409 30 652 489

Investments held to maturity 96 374 639 83 479 808

8. Payable to Related PartySouth African Board for Sheriffs – owed amount 2 064 520 2 819 269

The amount is unsecured, interest free and has no fixed terms of repayment.

9. Trust Account BalancesSheriff De Kock 1 398 031 1 398 031

Sheriff Butler 365 724 365 724

Sheriff IJ Pretorius 562 763 562 763

Sheriff SH Robertson 173 436 173 436

Sheriff S Du Toit 3 960 3 960

Sheriff TP Maulgass 329 085 329 085

2 833 000 2 833 000





10. Trade and Other PayablesAccrued expenses 140 811 30 617

Sundry Creditors 3 154 776 187 676

3 295 587 218 293

11. Financial Liabilities by CategoryThe accounting policies for financial instruments have been applied to the line items below:

Financial liabilities by category

Trade and other payables 3 295 587 218 293

12. ProvisionsOpening balance 1 March 1 100 790 2 256 427

Less Claims paid - (25 100)

Reduction of provision (1 100 790) (1 130 537)

Provision for uninsured claims - 1 100 790

The balance on the provision for Mogane claims has been reversed as the claimants could not be traced by year-end. See note 24.

13. RevenueFidelity fund certificates 493 602 456 343

Interest on Sheriffs trust accounts 16 082 728 14 627 160

16 576 330 15 083 503

The amounts included in revenue arising from exchange of goods or service are as follows:

Fidelity fund certificates 493 602 456 343

493 602 456 343

The amounts included in revenue arising from non-exchange transactions are as follows:


14. Operating SurplusOperating surplus for the year is stated after accounting for the following:

Depreciation on property, plant and equipment 241 056 242 558


15. TaxationNo provision has been made for 2017 taxation as the receipts and accruals to the entity are exempt from income tax in terms of section 10(1)cA)(i) of the Income Tax Act.






16. Cash Generated from OperationsSurplus for the year 10 882 530 11 763 267

Adjustments for:


Fair value adjustments - -

Interest income (10 207 420) (7 357 200)

Trust balances - (857 973)

Changes in working capital:

Trade and other receivables 45 410 (247 305)

Provisions (1 100 790) (1 155 637)

Trade and other payables 3 077 294 (90 476)

2 938 080 2 297 234

17. Related PartiesRelationships

Common board members South African Board for Sheriffs

The Sheriffs board was established under the Sheriff’s act and the Fidelity fund is managed by the board on behalf of the Minister of Justice. The Board enters into various transactions, on arm’s length with Fidelity Fund. The Board and the Fund had common board members for the year.

Related party balances

Payable amount – Owing to related party

South African Board for Sheriffs 2 064 520 2 819 269

Related party transactions

Administration fees charged by related party

South African Board for Sheriffs 11 574 751 10 429 309

The Administrative fee is based on the Sheriffs Act of 1986 as well as a Board Decision at what percentage the fee will be charged. This decision is then sanctioned by the Minister of Justice and Correctional Services.





18. Risk ManagementFinancial risk management

The entity’s activities expose it to a variety of financial risks: liquidity risk, interest rate risk and credit risk.

Liquidity risk

The entity’s risk to liquidity is a result of the funds available to cover future commitments. The entity manages liquidity risk through an on-going review of future commitments and credit facilities.

Cash is managed prudently by keeping sufficient cash in bank accounts. Cash is received from Sheriffs and the Fidelity fund.

Interest rate risk

The Board has interest-bearing assets and the income and operating cash flows are substantially dependent on the changes in the market interest rates. The interest-bearing assets consist of short term investments with floating interest rate that expose the Board to cash flow interest rate risks. The interest rate used is based on the Prime rate.

Credit risk

Credit risk consists mainly of cash deposits, cash equivalents and trade debtors. The entity only deposits cash with major banks with high quality credit standing and limits exposure to any one counter-party.

Trade receivables comprise a widespread customer base. Management evaluated credit risk relating to customers on an on-going basis. If customers are independently rated, these ratings are used. Otherwise, if there is no independent rating, risk control assesses the credit quality of the customer, taking into account its financial position, past experience and other factors. Individual risk limits are set based on internal or external ratings in accordance with limits set by the board. The utilisation of credit limits is regularly monitored.

19. Events after the Reporting DateThe Board is not aware of any matters or circumstances arising since the end of the financial year which significantly affect the financial position of the Board or the result of operations.

20. Public Finance Management ActIn a Board meeting held on the 15th October 2015, the Board resolved that the SABFS would no longer seeking listing in terms of the Public Finance Management Act (“PFMA”) schedules as required by S47(2) of the PFMA. The entity has therefore not been audited against the requirements of the PFMA, and the entity has therefore maintained its financial year for this reporting period as the end of February in terms of the Sheriffs Act.






21. Explanation of Variances between Actual and Budget Revenue The over recovery of revenue by R6,683,750 representing 33.25% is attributed to the following:

Sale of goods The over recovery of 23.40% on this line item is directly related to the number of sheriffs and the number of deputy appointments made for the year under review.

Interest received on trust accounts The over recovery of 21.84% of this line item is directly linked to the fact that the board are more actively ensuring that correct and competed information is submitted by the sheriffs. It is also due to interest hikes that took place during the financial year.

Interest receive on investments The over recovery of 57.04% on this line item is a direct result of the interest rates hikes that took place during the year. A new investment strategy were implemented which have seen higher interest rates applicable to most of the investments.

Operating expenses Total expenses is over budget by R1,523,410 representing a 9.84% over recovery which is attributed to the following:

Administrative fees The over recovery of 10.24% on this line item is due to the increase in growth in the Fidelity Fund due to the overall growth in the revenue for the financial year.

Audit fees The under recovery of 16.67% on audit fees is due the austerity measures implemented by the Board and the larger portion of the fees expensed in the SABFS.

Bad debts The under recovery on this line item is due to the adjustment of the provision for bad debts to 15% of the debit balances as at the end of the financial year.

Bank charges The under recovery on this line item is due to less transactions on the fidelity fund bank accounts.

Building maintenance All building expenditure was covered by SABFS. Major building maintenance will take place in the new financial year and will be expensed partly in the Fidelity fund.

Claims against the Fidelity FundThe over recovery of claims of R496,279 which represent an over recovery of 33.09% is due to claims in the amount of R3,097,069 which were approved for payment by the Board and the reversal of the Mogane provision in the amount of R1,100,790.

Consulting fees The under recovery of 100% on this line item is related to the fact that no special projects were undertaken where outside consultants were used.

Depreciation The under recovery of 19.65% is due to depreciation budget being based on a higher amount for the Building as the budget were approved prior to the revaluation that took place in 2016.

Disciplinary Inquiries & InspectionsThe over recovery of 45.63% in this line item is due to this being the first year that the amount are recorded in the fidelity fund and also an increase in the number of disciplinary inquiries for the year. Desktop inspections were implemented which also saved money for the fund.

InsuranceThe under recovery of 35.78% in this line item is due to the zero percent increase in the insurance premium for the year under review and also the change in insurance service providers.

Legal feesThe over recovery of 77.12% in legal fees is due to an increase in the number of disciplinary inquiries during the current financial year. Many of these disciplanary inquiries lead to court action being takne by the affected sheriffs and the SABFS had to defend these matters.

UtilitiesThis over recovery of 14.68% was due to the higher than expected increase in the Rates charges for the year.





22. Claims against the Fidelity FundAmount expensed in the current year 1 996 279 (1 453 937)

made up of

Current year claims 3 097 069 534 574

Mogane provision reduced to unpaid claims (1 100 790) (1 130 537)

Trust balances reversed where claims were paid against - (857 974)

Amount expensed in previous financial years - 25 100

Total claims paid for the year 1 996 279 (1 428 837)

23. VAT Ruling ImpactValue Added Taxation(VAT)

Surplus as per Income statement 10 882 530 11 763 267

Vat apportionment adjustment - -


24. ContingenciesLitigation

As at 28 February 2017, claims amounting to R19,610,920 (2015: R8,668,136) are under litigation against the Fidelity Fund, in respect of certain sheriffs, with a possible loss amounting to R13,538,365 (2016: R4,048,898) the outcome of which was uncertain at the date of issuing these financial statements. Should the action be successful the Fidelity Fund does have insurance cover to cover litigation costs and claims. An additional amount of R15,004,740 (2016: R0) were also misappropriated, but no claims were submitted for this amount. The outcome of the misappropriated amount is still uncertain.

Provision for Mogane Claims

During the 2013/2014 financial year the Board approved an amount R6,924,277 of which R5,823,487 was paid to the claimants. A balance of R1,100,790 was carried as a current liability in the statement of financial position. Due to the nature of the liability, it was decided to reverse the provision, but mentioned it as a contingent liability as the time of payment cannot be determined as the claimants concerned could not be traced. The SABFS is still in the process to tracing these claimants.




DETAILED STATEMENT OF FINANCIAL PERFORMANCEFOR THE YEAR ENDED 28 FEBRuARY 2017


Revenue

Fidelity fund certificates 493 602 456 343


Operating income 16 576 330 15 083 503

Other income

Interest income 10 207 420 7 357 200

10 207 420 7 357 200

Total Revenue 26 783 750 22 440 703

Operating expenses

Administration fees 11 574 751 10 429 309

Audit Fees 50 000 50 000

Bad Debts 4 579 (41 458)

Bank Charges 7 423 7 800

Claims against the Fidelity Fund 22 1 996 279 (1 453 937)


Disciplinary Inquiries & Inspections 145 627 -

Finance Charges - 73 124

Insurance 1 001 005 1 248 116

Legal fees 708 480 -

Utilities 172 020 121 924

15 901 220 10 677 436




NOTES

D O I N G T H E R I G H T T H I N G A N D D O I N G T H I N G S R I G H T .

88 Loop Street, Cape Town 8001T: 021 426 0577 | F: 021 426 2598 | E: [email protected]

SABFS Fraud Hotline: 0800 000 628

www.sheriffs.org.za

annual report 2016-2017 · annua reort 2016-2017 south african board of sheriffs honourable...

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