Inspiring Tomorrow’s Heroes

ANNUAL REPORT 2012

INDEXScope and boundary

Highlights for 2011

Directors report

Managers report

What we are about

How we create value

How we make decisions

Our methodology

Our partners

Our stakeholders

Our impact

Material issues

Risks & opportunities

Governance

Remuneration policy

Fundraising

Our projects

RedCap Young Heroes

RedCap Schools

Iciko and Eco-schools environmental Programme

Early Childhood Development

RedCap Jumpstart

RedCap Life Academy

Bursaries

Financial Report

Thank you South Africa!

By supporting the RedCap Foundation you’ve

helped us raise R1,2 million for initiatives to benefit children in South Africa.

01

01

03

06

07

07

07

08

09

10

11

12

13

14

15

16

17

18

21

23

25

27

29

30

31

R17.5 million grant awarded by The Development Bank of SA to our Jumpstart Project.

80 teachers trained in key learning areas: Maths, English, Technology and Natural Sciences.

R1,2 million in funds raised. This amount includes R300 000 raised by Mr Price and International model, Agyness Deyn for mobile libraries in KwaDukuza schools.

HIGHLIGHTS FOR 2011:

R17.5 milliongrant

80 teachers trained

R1.2 million funds raised

224,240 children to date benefited from RedCap Foundation programmes.

Iciko Arts and Culture Programme launched by Mr Price Group associates.

68 KZN Subject Advisors trained in Physical Education.

1270 unemployed matriculants given work experience in Mr Price stores.

The RedCap Foundation is a registered non-profit and public benefit organisation which carries out activities in all nine provinces of South Africa.This annual report, for the period April 2011 to March 2012, will be the sixth year of reporting since the RedCap Foundation’s establishment in 2006.The annual financial statements have been prepared on the historic cost and going concern bases in accordance with an association incorporated under Section 21.

Pg1

SCOPE AND BOUNDARY

224 240 children benefit

Iciko Arts and Culture Programme launched

68 KZN Subject advisors trained

1270matrics

given work experience

OUR INITIATIVES: RedCap Foundation, RedCap Young Heroes, RedCap Schools, RedCap Jumpstart, RedCap Life Academy, RedCap Club, Kids Are Priceless.

OUR PARTNERS: Mr Price Group, Unicef, National Department of Basic Education of South Africa, Sportstec, Durban University Of Technology, Dell Computers, JET Education Service.

There are millions of young South Africans who are not able to generate their own income, mostly due to an education system that had failed them. At the Foundation, we have an increasing conviction and commitment to assist a lost generation of youth with the ability and belief that they have unlimited potential, and that they too have a positive role to play in our society.

Our vision of a South Africa where young people create positive change by being inspired, healthy and engaged citizens therefore becomes an enormous task. We believe strongly that we can play a significant role by facilitating job experience. This year we increased our investment in the JumpStart programme and our efforts to mobilise and collaborate with other partners that have dedicated many years to assist unemployed youth in our country.

To make a significant impact on the lives of unemployed youth requires the joining of hands and collaboration with others to find solutions to a perpetual cycle that is fast becoming one of the most concerning realities of our nation. We are very optimistic about how the grant from the JobsFund will assist us to increase the impact of the JumpStart Project on the lives of many unemployed young people. In addition, the RedCap Foundation identifies a significant opportunity in working with a network of Non-Profit Organisations around the country to develop appropriate skills for the job market.

Whilst we have increased our investment in assisting young adults, we understand that in order to change this reality in future, work must be done to develop children from an early age. The Foundation has therefore also increased its investment in Early Childhood Development (ECD), as we have seen how the lack of ECD impacts on the employability of young people. Our commitment to improve ECD centres in KwaDukuza has grown to include 48 centres where teachers are trained on ECD and the tools required in doing this.

The RedCap Schools Project, an intervention focused on working with stakeholders such as teachers, school management, parents, the community, learners, local government, district personnel and other local businesses, is implemented in a group of five primary schools with the focus on improving learner performance. We hope to see the preliminary impact made in these schools this year, when the mid-term evaluations are done.

Our work with the National Department of Education, in establishing Centres of Excellence in Physical Education (PE) and School Sport, continues as we grow the centres to six provinces this year, with the hope to have centres in all nine provinces by the end of 2013. The centres are used to train teachers from surrounding districts in each province, on impactful and comprehensive implementation of PE and schools sport.

AcknowledgementsI would like to once again, give a vote of thanks and gratitude to all our board members for their guidance, support and dedication to the work of the Foundation. To Natasja Ambrosio and the RedCap Foundation Team. Your hard work and dedication to our vision is really appreciated.

Lastly, none of this work will be possible without the ongoing commitment from Mr Price Group, its employees, suppliers and customers, who continue to provide financial and other assistance to the Foundation. A special thanks to Wisdom and Youth for their ongoing commitment to provide creative guidance to the Foundation, at no cost, and for the speed within which this work is done and delivered.

DIRECTORS REPORT

thank you!

Verna Botha-Richards Foundation Chairman

Pg3

Our vision is of a South Africa where young people create positive change by being inspired, healthy and engaged citizens...

During the year under review, a concerted effort was made by the Foundation team to work deeper into programme implementation, thereby maximising the impact made on the lives of children and youth. This meant identifying potential gaps with current interventions and responding with innovative ideas to address these gaps.

In the RedCap Schools Project, we identified that many schools did not provide teaching on practical skills in arts, drama and dance, due to the lack of teachers training on practical exercises that can be used in the classroom. A team of volunteers from Mr Price assisted the Foundation in developing lesson plans aligned to the curriculum, and currently dedicate one Saturday every month, to teach groups of children and teachers in these schools practical skills in arts, drama and music. The programme was named Iciko, meaning talent.

In addition, the Foundation team, together with strategic partners in the Non-Profit sector focusing on assisting unemployed youth, successfully secured R17.5 million in funding from the JobsFund. The main objective of the funds is to capacitate Non-Profit Organisations working with unemployed youth, to incorporate business-specific training into their programmes, and thereby equipping young people with the skills required by business. An applicant screening system in Mr Price stores have shown significant gaps in skills and abilities required by business for entry level associates in stores as well as current applicants entering the job market. This assisted the Foundation to identify opportunities to develop a structured approach in response to this need.

The Foundation, in partnership with the National Department of Education, established RedCap Centres of Excellence in Physical Education and School Sport in three provinces. Each centre consists of a cluster of five schools, and each school is capacitated with the skills and equipment to incorporate a comprehensive programme on Physical Education as well as Extra-Mural, Intra-school and Inter-school Sport. Teachers are trained to conduct lessons once a week during school time, to ensure children experience Physical Education and develop their gross motor skills and muscle development, as is so necessary for children in primary schools. The Centres of Excellence are used as examples to assist other districts and schools in each province to see and experience a best practice model in action. Our plan for 2013 is to establish another three centres, taking these centres to six provinces.

Further to the Mr Price Group’s donation of R8.8 million, the Foundation raised R1,2 million from various donations which include Mr Price Group employees, board members, suppliers, customers, cause-related products, volunteering initiatives and other initiatives such as a book sale in aid of the Foundation’s programmes.

We finalised our Monitoring and Evaluation plans, and identified indicators that are being used to track the performance and impact of all our programmes. We look forward to the data and results that will be used to guide strategic decisions and programme development going forward.

Natasja AmbrosioFoundation Manager

MANAGER’S REPORT

arts and crafts

Pg5

HOW WE CREATE VALUEWe understand that systemic change is necessary in order to achieve our vision. It is for this reason that the Foundation invests in sustainable and innovative interventions, focused on South African national priorities, through strategic partnerships.

Education is the main focus of the Foundation. Our objective is to inspire a different way of thinking and implementation in the education system. Every intervention is established with a sustainability strategy to avoid creating dependency amongst participants. We invest in human capacity to enable appropriate responses to the educational needs of the children. There is a continuous shift of ownership to the participants within the school community, including the provincial and regional education departments, principals, teachers, parents, learners and the broader community.

The Foundation identifies gap areas where it can innovate and show different ways of addressing challenges currently experienced by the system.

HOW WE MAKE DECISIONS Decisions are informed by research commissioned and funded by the RedCap Foundation and strategic partnerships with civil society and government. Regular Integrated Monitoring and Evaluation (M&E), assists by informing our strategy in future, as we believe the data generated from the M&E process will be valuable in shaping strategic thinking.

Decisions are also informed by alignment with Mr Price Group’s social investment agenda, coupled with the pressing needs of children and youth in South Africa, to ensure both a social and economic return on investment. The critical importance of the environment and the impact of climate change, in particular on citizens of lower income groups, have been acknowledged.

The RedCap Foundation has a vision for South Africa where young people create positive social change by being inspired, healthy and engaged citizens. We focus on children from birth to 25 years as our beneficiaries.

WHAT WE ARE ABOUT

storytime

Pg7

The RedCap Foundation is strategically linked to Mr Price Group and realises the value of business concepts and thinking to address social challenges in an innovative way. This business thinking has influenced our methodology in the following ways:

The need for capacity building and skills development to achieve results.

Offering value by driving efficiency with limited resources.

This methodology forms the basis of the Foundation’s interventions to address the complex social challenges we face in our country today.

Recognition of the importance of incentives in driving performance.

OUR METHODOLOGY

1

6

2Creating space for innovation.3

4The importance of stakeholder engagement; and the value of ownership, passionate people and partnerships.

5

OUR STAKEHOLDERSWe acknowledge that our programmes will have very little impact without the involvement and collaboration of our stakeholders. For this reason the Foundation, since its inception, has engaged with its stakeholders and built partnerships with the collective aim of improving the lives of children and youth in South Africa.

For further information about our stakeholder engagement, please visit: www.redcapfoundation.org

GOVERNMENT

BENEFICIARIES

FUNDERS

MEDIA

CIVILSOCIETY

IMPLEMENTATION PARTNERS

Pg9

SportsTec is our implementing partner for the YoungHeroes project - a dynamic sports development organisation with a mission to inspire and empower people to live their dreams through sport, health and education.

DUT provides training for educators in basic computer literacy and this enables the educators to transfer these skills to learners in their schools.

Dell is our sponsor of computers for RedCap Schools. They allocate 150 desktop computers per year, to help set up computer labs in schools.

JET Education Services is our implementing partner in the RedCap Schools Project – JET has a mission to offer educational research and knowledge-based interventions that are innovative and sustainable.

OUR PARTNERS Strategic Partners

Implementation Partners

we couldn’t have done it without you!

RedCap Foundation: CALL: +27 31 310 8242

EMAIL: info@redcapfoundation.org WEB: www.redcapfoundation.org

Donations: If you would like to make a donation, please email the Foundation for further information.

OUR IMPACT

Pg11

Material issues are identified through a process of continuous research, which includes information derived from engaging with stakeholders and the Integrated Monitoring and Evaluation process.The following material issues have been identified:

• The poor level of education offered by the public school system in South Africa• The lack of parental and community ownership in children’s education• The dependency mindset, often visible amongst poor communities• Complexity involved in improving the education system• The gap between business needs and available job seekers in South Africa• The lack of structured physical activity and sports opportunities for children from poor communities• The increasing gap of inequality, aggravated by poor education in public schools• High levels of pregnancies amongst learners in our schools• High levels of orphaned and vulnerable children• Limited collaboration between government, civil society and business

MATERIAL ISSUES Impact Description of intervention

Social • Improving education for children by developing teacher, principal, district and parental knowledge• Building capacity in the Non-Profit Sector by sharing knowledge with implementation and strategic partners• Contributing to policy development and implementation strategies in education• Addressing existing gaps between unemployed youth and access to job opportunities• Creating collaborative partnerships, within and across sectors

Financial • Funding necessary resources and capacity building in education • Fundraising initiatives to increase income generation • Expanding our reach through additional funds raised• Sustainable income and investment • Governance and audited financials

Environmental • Reduce, re-use and recycle initiatives in partnership with Mr Price Group• Reducing carbon footprint on travel by using appropriate technology• Environmentally preferred products• Environmental education and initiatives in schools (Eco-Schools)

Economic • Improving the level of education through initiatives and bursaries • Addressing skills gap between unemployed youth and business needs• Job creation in civil society through implementation partners particularly in absorbing skills in sports development• Target skills development • Local economic development through using skills and services from local small enterprises

COMMITMENT STATEMENTThe RedCap Foundation subscribes to sound values of good corporate governance and supports, where applicable, the principles and practices of the King Code of Governance for South Africa 2009 (King III).

In addition to ensuring compliance with the new Companies Act, Act 71 of 2008, the Foundation annually renews its registration with the Department of Social Development as a non-profit organisation (registration number 053 536 NPO). Furthermore, the Foundation continuously ensures that it meets the requirements of both a public benefit organisation and welfare organisation, as stipulated in terms of the Income Tax Act, Act 58 of 1962.

DIRECTORS AND MEMBERSThe appointment during the year of Mrs Natasja Ambrosio as a director ensured that the Foundation was in compliance with section 66 (2)(a) of the Companies Act, Act 71 of 2008, which stipulates a minimum of three directors for a non-profit company. In addition, the Foundation operates with an executive committee comprising seven members, three of whom are the directors.

As at year end, the Executive Committee of the Foundation consisted of the following seven members:• Mrs Verna Botha-Richards (Chairman)• Mr Stuart Bird (Director)• Mrs Natasja Ambrosio (Director)• Mrs Helen Grosvenor (Company Secretary)• Mrs Louise Holmes• Mr Creesen Naicker (Independent )• Mr Pierre Tostee

FOUNDATION MANDATEThe Foundation operates in terms of a formal mandate, the purpose of which is to regulate how business is to be conducted by the Committee in accordance with the principles of sound corporate governance. Whilst the Foundation’s Memorandum of Incorporation outlines its statutory duties, the mandate ensures that all Committee members, acting on behalf of the Foundation, are aware of their duties and responsibilities as members and the various legislation and regulations affecting their conduct and to ensure that the principles of sound corporate governance are applied in all their dealings in respect of, and on behalf of, the Foundation.

Our objective is to implement sustained interventions and to ensure that through our efforts, we guard against creating dependency. To do this, we focus on strengthening and capacitating beneficiaries to improve their lives. We plan needs-appropriate interventions with the aim to identify gaps that cause the perpetuators’ cycle of poverty.

The Foundation relies on the capacity, abilities and commitment of implementing partners in the delivery of our projects.

These partners represent our interests and values and are responsible for utilising the donated funds effectively and efficiently and for the intended purposes.

MEETING STRUCTURE AND ATTENDANCE AT MEETINGSA minimum of four Executive Committee meetings are held during the year and the Annual General Meeting is held in September.

COMPANY SECRETARYIn view of the recommendations outlined in King III on the responsibilities of the company secretary, the committee believes Mrs HE Grosvenor is a competent, suitably qualified and experienced company secretary able to provide the Foundation with the requisite support for its efficient functioning and discharge of its duties.

Member June 2011 AGM (Sep’ 2011) Dec’ 2011 March 2012

Present Present Present Present

Present Absent Present Present

Present Present Present Present

Present Present Present Absent

Present Absent Absent Absent

Present Present Present Present

Present Present Present Present

Mrs Verna Botha-Richards

Mr Stuart Bird

Mrs Natasja Ambrosio

Mrs Helen Grosvenor

Mrs Louise Holmes

Mr Creesen Naicker

Mr Pierre Tostee

All our funded interventions have a sustainability strategy in place and implementing partners are measured on their ability to build lasting practices that can be sustained by people in the communities in future. We continuously conduct research so that our response is appropriate and addresses the necessary gaps identified by beneficiaries of our programmes.

We encourage and support the continuous development of programme coordinators and managers implementing our programmes.

Our agreements with partners include the requirement of representing our interests and values as well as spending our donated funds on specific initiatives as agreed in a Memorandum of Understanding with each partner.

Sustainable projects that meet real community needs

Partners

CONTEXTWHY THIS IS SO IMPORTANT

WHAT WE ARE DOING

RISKS & OPPORTUNITIES GOVERNANCE

The RedCap Foundation is reliant on donor funding and therefore require a sustainable income stream to support our strategic imperatives.

We employ a full-time fundraiser who actively seeks opportunities for continuous and sustainable income streams for the Foundation.

Donors

Pg13

As a Non-Profit Organisation, the RedCap Foundation is aware of the need to build a sustainable organisation and therefore commits to fundraising initiatives in addition to the annual donation made by Mr Price Group.

The RedCap Foundation is a registered Public Benefit Organisation, and issues a tax deductible receipt, in terms of section 18A of the Income Tax Act, to donors of the Foundation. This year the Foundation raised a total of R1 213 127.83 from the above initiatives.

Fundraising Initiatives included the following:• Mr Price Apparel sales of dresses, promoted by international model, Agyness Deyn, with 10% of sales donated to the RedCap Foundation.• The “Kids are Priceless” campaign in association with Mr Price Home.• The Mr Price Durban Triple Challenge Cycle Tour (DTCC). • Book sale at Mr Price Group Head Office.• Donations from Mr Price Group Honorary Chairmen.• Monthly donations made by Mr Price Group associates.• Mr Price Group customers donations.• Mr Price Group supplier donations.

Funding is required to sustain our projects, and to assist new projects to get off the ground. Our fundraising drives will be increased this year to enable us to reach the lives of manymore South African children.

$$$

REMUNERATION POLICY

REDCAP FOUNDATION REMUNERATION PHILOSOPHYThe RedCap Foundation associates are one of its most vital resources. Each associate is valued for their role in representing the Foundation’s culture, ethics and values as well as contributing to the improvement in the welfare and lives of the youth in South Africa.

The Foundation is affiliated to the Mr Price Group and therefore has a similar remuneration philosophy to that of the Group. The Mr Price Group is a value retailer which aims to pay basic salaries and benefits at the market median. The Foundation follows this same strategy. Furthermore, the Foundation associates also participate in the Mr Price Group employee share option and investment schemes, which allows associates to share in the growth of the Group as a whole.

Key to the Foundation’s future growth and sustainability is the ability to attract, retain and motivate competent people within the Foundations budgetary allowances. The remuneration philosophy centres on creating partnerships with our associates in the journey of continued growth and development whilst on their career path. Remuneration is not influenced by race, creed or gender, with the emphasis on equal pay for equal work.

At the end of the 2012 financial year, the Foundation employed four full-time employees on a permanent basis. The three Foundation directors, the company secretary and two Foundation members are employed by Mr Price Group and offer their services to the Foundation pro-bono. The remaining member, Mr Creesen Naicker, was paid a monthly retainer in his capacity as external consultant, but offered his services as a member of the committee on a pro-bono basis.

Pg15

FUNDRAISING

OUR PROJECTS

Northern Cape

Western Cape

Cape Town

Mitchells Plain

Port Elizabeth

Nelspruit

Standerton

Polokwane

JHB, Pretoria, Soweto

Eastern Cape

North West

Free StateKwaZulu Natal

Limpopo

MpumalangaGauteng

Jumpstart

Young Heroes

RedCap Schools

We’re sti l l growing!

Pg17

Mafikeng

Upington

JUMPSTART: Durban, Pinetown, Ballito, Port Shepstone, Richards Bay, Vryheid.YOUNG HEROES: Stanger, GroutvilleREDCAP SCHOOLS: KwaDukuza

YoungHeroesOUR AIMThe YoungHeroes programme aims to develop a passion for regular exercise and healthy lifestyles amongst children in low income communities. We created RedCap Centres of Excellence - clusters of five primary schools – where we demonstrate best practice for the implementation of Physical Education (PE) and school sports in South Africa. The YoungHeroes model is implemented in partnership with the National Department of Education (DOE).

This year, we established RedCap Centres in four provinces. We aim to be established in six provinces at the end of 2013 and then in all nine provinces by 2015. While the focus is on the centres, knowledge is freely shared with all other primary schools in the provinces and manuals can be downloaded from the RedCap Foundation website. www.redcapfoundation.org

BACKGROUNDSince 2005, the RedCap Foundation has tested various implementation models in order to assist public primary schools with weekly PE lessonsz and introducing school sport. The programme has been successfully implemented in over 152 schools in KwaZulu Natal, Gauteng, Western Cape and Limpopo.

This year, the project has reached 16 104 children in four provinces.

WHY THIS IS IMPORTANTAccording to research studies, regular and structured physical activity has a great impact in the lives of children physically, psychologically and socially – particularly when the passion for regular exercise is developed in early years. An impact evaluation conducted on our YoungHeroes programme, also showed a positive association between physical activity – through PE - and better concentration in the classroom amongst primary school children. PE is also vital in the development of gross motor skills and the decrease in health risks such as heart disease and obesity in children and youth.

DBE strategy and implementation

infused with learnings from YoungHeroes

Sustainable RedCap Centres

(for PE and School Sport)

RedCap Centres used as the

provincial hub/examplar for PE & sport

To make a positive contribution to society

through physical education and sport

Ongoing PE and sport (without outside

facilitation)

Running parallel to all RCF programmes

is monitoring and evaluation & research;

and the sharing/dissemnation of findings

Sustained leagues between schools

Educators using sport as a tool

for development

Trained educators, (capable of designing & implementing PE,

sport and SfD)

Intra-school activities (inter-class and

inter-house)

Extramural physical activity and sport

Participation of schools in leagues

Embury (or equivalent) PES course

PE lessons

Sport specific

workshops

Inter-class&

inter-house modified games

Sport as tool for

development

Inter-school sport

leagues

Production/ sourcing

and distribution

Training and

workshops

Facilitation and teacher workshops

Equiptment and lesson

plansrelevant to available budgets

INPUTS

THE YOUNG HEROES PROGRAMME RESULTS CHAIN

ACTIVITIES

OUTPUTS

OUTCOMES

IMPACT

[ ]

Over 2500 educators and 85000 learners have been involved in the implementation of

YoungHeroes Programme since inception.

In 2012 YoungHeroes is

being implemented in KwaZulu Natal, Gauteng, Western Cape, Limpopo and

Northern Cape.

Pg19

INTERMEDIATE OUTCOMES

OUR AIMThe RedCap Schools Project, launched in 2010, provides a holistic approach to school improvement. The primary aim is to instill a culture of excellence amongst the school leadership, teachers and children in five primary schools in KwaDukuza. The Foundation hopes to improve learner performance by offering access to quality education to children and, through collaboration with our partners, contributing to meeting the needs of these children.

WHAT WE DOSchools are assisted to develop a “Culture of Excellence” by capacitating teachers and school leadership as well as getting parents involved in their children’s education. RedCap Foundation provides the necessary resources for teachers to deliver better quality education to children in the classroom. Sustainable interventions are implemented in partnership with our implementation partners, who are experts in the following areas:

PRINCIPALS AND SCHOOLS MANAGEMENT TEAMS (SMT)Strong and inspirational school leadership is key to the success of our intervention. Principals and School Management Teams (SMT’s) are capacitated through leadership and mentorship programmes that ensure effective monitoring of curriculum delivery, compliance and implementation of school policies and general functionality of the schools.

SCHOOL GOVERNING BODIES (SGB’S) These are empowered to take ownership and ensure effectiveness in their roles.

TEACHER DEVELOPMENT Teachers undergo intensive content knowledge training by experts in Maths, English, Science, Technology and ECD (Grade R) in order to improve their subject knowledge and classroom practices.

PARENTAL INVOLVEMENT Parents are capacitated to take active roles, not only in the education of their children, but also through involvement in academic and non-academic activities in the schools.

Schools

8ARTS &

CULTURE

9ECO SCHOOLS

1LEADERSHIP & MANAGEMENT

1 0PE & SCHOOL

SPORT

2 PLANNING &

ORGANISATION

3TEACHER

DEVELOPMENT

4PARENTAL

INVOLVEMENT

5GRADE R

INTERVENTION

6LITERACY

DEVELOPMENT

7COMPUTER

LABS

SchoolsRedCap Schools Project

Creating a Culture of Excellence

“A good head and good heart are always a formidable combination. But when you add to that a literate tongue or pen, then you have something very special.”- Nelson Mandela

Pg21

FROM OUR PARTNERSMichelle Mathey, Executive Manager JET Education remarks “It is not an easy job to transform schools from dysfunctionality to excellence. Yet despite the barriers such as rurality, poverty, unemployment and illiteracy which face our schools. The RedCap Foundation demonstrates a strong sense of ownership to the project and a tangible positive attitude towards all activities implemented by the different partners”.

Mr Senzo Lushaba, Principal at St Christopher Primary says “On rainy days our learners would not come to school, but now they know that practical activities are taking place in the classroom. As a result we have seen increased motivation and children now attend school more regularly.”

ICIKO – ARTS, DRAMA AND CULTURE This programme, encompassing arts, drama, culture and dance, was introduced into our RedCap Schools in KwaDukuza. Conceptualised by Mr Price associates from the Visual Merchandise Department and in line with the Education Department’s Arts and Culture curriculum, it aims to incorporate Arts, Drama, Music and Dance as part of each school’s daily classroom routine, enhancing the learning experience of children whilst also upskilling and encouraging teachers.

Teachers and volunteers attend two workshops annually where they are provided with clear monthly lesson plans with step-by-step pictures and video footage. Activities range from monthly Visual and Performing Arts lessons to children, forming school choirs and writing school songs. Assessments take place twice a year. These lessons have been incorporated into weekly arts lessons - giving all children in the school the opportunity to develop their creative abilities.

ECO-SCHOOLS ENVIRONMENTAL PROGRAMMEEducators and learners from two Young Heroes Schools and three RedCap Schools in KZN have participated in the Eco-Schools programme which includes food gardening workshops based on permaculture principles and the formation of Eco-Committees. Based on an Eco Code, learners are taught to be environmentally aware and are encouraged to replicate what they have learnt at home. Educators will integrate Eco-lessons in all learning areas.

Instituted in partnership with Wildlife and Environmental Society of South Africa, this programme hinges on permaculture methods which teach children to mimic nature in order to keep the right balance within all natural eco-systems. This approach also ensures that no artificial fertilizers or pesticides are used.

Schools are given a choice to choose their themes which vary from Recycling, Gardening (Herb, seed and food gardens) to Energy Saving.

Pg23

WHAT WE DOThe RedCap Foundation, in partnership with the Unlimited Child, a Non-Profit Organisation specialising in ECD, empowered 27 feeder crèches at Redcap Schools in KwaDukuza. Caregivers in these ECD centres were capacitated with necessary skills and then provided with educational toys needed to implement these newly acquired skills. The centres are monitored and sustained by the Department of Education’s Ilembe District.

FROM OUR PARTNERS “The implementation of the project in the Stanger Region has been 100 percent successful. Monitoring of the implementation shows that the impact of the programme is highly sustainable. The crèche caregivers are excited and enthusiastic about the transformation in their work” comments, Ian Corbishley, Unlimited Child Project Manager.

Our partnership with United Nations International Children’s Fund (UNICEF) in raising funds through the Kids are Priceless campaign continues to enable them to work in support of government’s prioritisation of ECD. Last year an amount of R186 439.15 was given to UNICEF through this campaign.

Marisol Gutierrez, Partnership Specialist, UNICEF South Africa says “Early Childhood Development programmes give a child the best start in life - yet less than half of South Africa’s younger children are exposed to them. This deprives children of fulfilling their potential and damages their chances for success. With the support of partners like Mr Price, UNICEF is working towards zero children being left out and left behind.”

EARLY LEARNING AND STIMULATION IS VITAL FOR DEVELOPMENT OF CHILDREN...

OUR OBJECTIVE We aim to optimise Early Childhood Development (ECD) by providing early social, physical, intellectual and creative stimulation to young children in low income areas. Funds are raised through the sale of Kids Are Priceless soft toys at Mr Price Home stores nationwide.

Pg25

Buy a Kids are Priceless soft toy for R29.99 at Mr Price Home and fill a heart with hope.

All funds raised go to RedCap Foundation’s education initiatives and UNICEF’s Early Childhood Development programmes.

JumpStartOUR OBJECTIVEThe JumpStart project aims to provide a “jump start” to young people and help them gain much needed skills to access the job market. Through this project we also aim to contribute to addressing the unemployment challenge in our country. By participating in our programme, candidates acquire new skills, which help them gain confidence and become motivated to be active job seekers.The JumpStart project is a six day work experience programme, where unemployed young people between the ages of 18 – 24 are given the opportunity to gain work experience and an understanding of the ‘world of work’ through Mr Price Group stores. We partner with over 25 Non-Profit Organisations who offer life skills and personal mastery programmes to the youth and FET colleges, in all nine provinces.

While the programme does not guarantee employment to participants, Mr Price Group operational managemnet is encouraged to offer part-time employment to suitable JumpStart candidates when they complete their work experience. Since the inception of the project – over 5000 unemployed youth were given work experience opportunities and 600 of these are now permanently employed in the Group.

Through the JumpStart Project the Joblinx database system was launched – an online candidate tracking and placement system. Joblinx links the programme with our NPO partners for effective implementation and tracking purposes as well as job placements of participants by Mr Price Group stores.

SANDILE NGCOBO Mr Price Home Gateway

NELISA ZULUFianancial Services

JUMPSTART DELEGATESMr Price

MANDISA NZAMA Mr Price Home

WHAT WE DID In addition to the six day programme, during the past year, the Foundation partnered with the Wholesale and Retail (W&R) SETA and Resonance Training Institute, in piloting an internship programme for 100 unemployed matriculants. The candidates embarked on a year-long programme based at Mr Price stores in KwaZulu Natal, Gauteng and Western Province. We are very proud to report that 91 learners graduated with a NQF Level 2 National Certificate in Wholesale and Retail. The placement of the interns into stores for a period of 12 months significantly impacted on their lives. 80% of participants on the programme received employment offers. Although 48% of the delegates failed the pre-employment assessment prior to the inetervention, 96% passed at the end of the programme, demonstrating that work experience plus classroom training improves employability.

WHY THIS IS IMPORTANTIt has become evident that our education system does not equip young people adequately, with the necessary skills required in the world of work. Our youth have little or no understanding of what is required to be an effective and efficient employee in the work place. The lack of experiential training and exposure has also been a major factor to the rising unemployment challenge in our country. Pre-employment assessment tests conducted by Mr Price Group have shown a very low pass rate indicating that our youth – having completed matric – do not have the required minimum level of literacy and numeracy skills.

There is a growing need for the linkage and collaboration between the non-profit sector – working with the youth – and business. This will have a meaningful impact on the lives of young people, and similarly, businesses will then yield the fruits of a productive entry level workforce in our country.

QUOTESBlessing Dube, manager at Mr Price Argyle Home, has a policy to employ only Jumpstart delegates.

“The main reason for this is because I like to support community initiatives. Someone believed in me and gave me the opportunity to become what I am today,”

he says, adding that all Jumpstarters are rough diamonds that need to be polished. He believes his attitude towards them brings out the best in them.

Joe White from World Changers Academy has been partnering with Jumpstart since 2009. “This initiative is very exciting with many positive outcomes and also many challenges. World Changers has trained over 25 000 unemployed and high school youth through its life skills programmes since it started 10 years ago. Helping our students find employment has been an ongoing challenge. However, through the RedCap Foundation’s Jumpstart programme, there has been an exciting opportunity for us to deal with this issue.”

Pg27

These guys

have made

us proud!

Life AcademyOUR AIMLife academy is a holiday programme, designed to assist Mr Price Group employees’ children with fun – yet educational and meaningful holiday programmes that enrich their lives as well as their academic performance.

WHAT WE DID In the year under review the following programmes were offered:

FAST FORWARD CAREERS PROGRAMMESkills Tree ran a Fast Forward career programme with high school learners from Grade 8 to Grade 12 in the June 2011 holidays. Learners were taught how to write CVs, basic financial management, life skills and how to choose a career according to their personalities. On the last day, different tertiary institutions and professions were invited to talk to the children to offer career information and practical information on subject requirements for different careers.

MATHS HOLIDAY PROGRAMMEA Maths holiday programme in partnership with Bodill Tutor Education Consultancy was run for Grades 5 to Grade 7 during the October 2011 school holidays. The purpose of the workshop was to help pupils gain a deeper understanding of Maths from an early age – not only as a subject, but also in order to be able to apply Maths concepts in their daily lives. If children do not have a solid foundation in Maths, they fall behind easily and eventually lose interest in the subject. They were encouraged to take the subject through to matric. The workshop was divided into two learning areas – Content Math’s and Thinking Maths – and was a great success.

KINGS CAMPIn keeping with our vision of creating positive social change by inspiring young South Africans to be healthy, the RedCap Foundation partnered with Kings Camp during the Easter Holidays. Kings Camp has been providing sport and activity camps for children aged between four and 17 throughout Africa and the UK for 18 years. They combine the best elements of a holiday club, sports camp and activity holiday into a week of fun and adventure where children can explore new sports and activities, make friends and enjoy their holidays in safe surroundings. Competitions and theme days contribute to the fun. The camp, enjoyed by 118 children, produced many success stories and many friendships blossomed.A comment from one of the parents sums it up:“I would like to say a BIG THANK YOU on behalf of my child to the “REDCAP FOUNDATION” for making her holiday unforgettable!! She had so much fun and we cannot thank all concerned enough `for making her holidays so much more exciting than they would have been. Without “Kings Camp” she would have spent most of her holidays at home while I was at work.Being a single mom, it is always tough to make arrangements for your kids to be “entertained” during the holidays, especially when you can’t take time off work. So, for me personally, I am so grateful for this “gift”. I didn’t think I could love working for this company any more than I already did!!!” Deanne Ford

Fun in the pool!

BURSARIESA HAND UP FOR DESERVING CHILDREN...

OUR AIMMany parents are not able to afford quality education for their children. We extend our help and assist deserving children by providing the necessary funds.

HOW WE DO ITIn 2008, The RedCap Foundation launched a bursary fund to assist deserving children from lower-income communities with education fees. The bursaries range from Early Childhood Development to Tertiary Education. The total number of bursaries awarded to qualifying participants in 2011/2012 was 235 totaling R794756.85.

THE MOTHER OF A BURSARY RECIPIENT, CHARNÉ BECHOO, HAD THIS TO SAY:

“This bursary really helped me very much. I wouldn’t have made it without the RedCap Foundation. My hard work and dedication to the Group has paid off for my child. Many thanks to the RedCap Foundation and the Mr Price Group for giving my child this opportunity.”

Charné has been an exceptional student. This year, she has achieved 82% in PC Training and Business.”

122

55

22

20

16

Early Childhood Development 22

Primary Schools 122

TYPE OF INSTITUTION NO. OF BURSARIES

High Schools 55

Senior Secondary Schools 16

Tertiary 20

Pg29

Directors’ approval of annual financial statements The annual financial statements, which appear on pages 34-42, were approved and signed by the directors on 23 May 2012.

REDCAP FOUNDATION NPC ANNUAL FINANCIAL STATEMENTS AT 31 MARCH 2012

Directors N Ambrosio, SI Bird, VT Botha-Richards Purpose Non-profit organisation focusing on youth development and education Secretary HE Grosvenor Auditor Ernst & Young Inc. Banker ABSA Bank Limited Country of incorporation and domicile South Africa Company registration number 2005/002290/08 Non-profit organisation number 053-536-NPO Public benefit organisation number 930 023 271 Business address Upper Level North Concourse 65 Masabalala Yengwa Avenue Durban 4000

FINANCIALS

Contents Pages

Report of the independent auditor 33 Report of the directors 34 Statement of financial position 35 Statement of comprehensive income 35 Statement of changes in equity 36 Statement of cash flows 36 Notes to the financial statements 37-42

VT Botha-Richards

Pg31

We have audited the annual financial statements of Redcap Foundation, which comprises the statement of financial position as at 31 March 2012, the statement of comprehensive income, the statement of changes in equity, the statement of cash flows for the year then ended, a summary of significant accounting policies and other explanatory notes and the Directors’ report as set out on pages 34-42

DIRECTORS’ RESPONSIBILITY FOR THE FINANCIAL STATEMENTS The Foundation’s Directors are responsible for the preparation and fair presentation of these annual financial statements in accordance with International Financial Reporting Standards, and the requirements of the Companies Act of South Africa and for such internal control as the Directors determine is necessary to enable the preparation of financial statements that are free from material misstatements whether due to fraud or error.

AUDITOR’S RESPONSIBILITY Our responsibility is to express an opinion on these annual financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the annual financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the annual financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the annual financial statements, whether due to fraud or error. In making these risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the annual financial statements 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 entity’s internal control. An audit also involves evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Directors, as well as evaluating the overall presentation of these annual financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

AUDIT OPINION Basis for qualified opinion In common with similar organisations, it is not feasible for the entity to institute accounting controls over cash collections from donations and fundraising activities prior to initial entry of the collections in the accounting records. Accordingly, it was impracticable for us to extend our examination beyond the receipts actually recorded. Qualified opinion In our opinion, except for the effect on the financial statements of the matter referred to in the previous paragraph, the financial statements present fairly, in all material respects, the financial position of the association as at 31 March 2012, and the results of its operations and cash flows for the year then ended in accordance with International Financial Reporting Standards and in the manner required by the Companies Act of South Africa. Ernst & Young Inc. Director - Marise Isebella Delport Registered Auditor Chartered Accountant (SA) Durban 23 May 2012

NATURE OF OPERATIONS The association is a non-profit organisation focusing on youth development and education.

RESULTS OF OPERATIONS The results of operations for the year under review are set out in the annual financial statements.

DIVIDENDS Being an association incorporated not for gain, no dividends can be declared.

DIRECTORS AND SECRETARYParticulars of the present Directors and Secretary are given on page 31.

EVENTS SUBSEQUENT TO YEAR END No material fact or circumstance has occurred between the accounting date and the date of this report.

GOING CONCERN The Directors believe the association is a going concern. The annual financial statements have accordingly been prepared on this basis.

PREPARATION OF ANNUAL FINANCIAL STATEMENTS The annual financial statements have been prepared by Mark Roe-Scott CA(SA).

REPORT OF THE INDEPENDENT AUDITOR TO THE MEMBERS OF REDCAP FOUNDATION

(Association incorporated under Section 21)

REPORT OF THE DIRECTORS REDCAP FOUNDATION (Association incorporated under Section 21)

Pg33

RedCap Foundation NPC - Annual Financial Statements at 31 March 2012 RedCap Foundation NPC - Annual Financial Statements at 31 March 2012

Accumulated funds R

Balance at 31 March 2010 563 349 Total comprehensive income 3 057 533 Profit for the year 3 057 533Other comprehensive income - Balance at 31 March 2011 3 620 882 Total comprehensive income 124 685 Profit for the year 124 685 Other comprehensive income - Balance at 31 March 2012 3 745 567

2012 2011 Note R R

Cash inflows from operating activities 2 426 893 920 614Cash generated from operations 8.1 2 423 434 912 120 Finance income 3 459 8 524Finance costs - (30)

Net increase in cash and cash equivalents 2 426 893 920 614 Cash and cash equivalents at the beginningof the year 1 515 815 595 201 Cash and cash equivalents at the end of the year 3 942 708 1 515 815

STATEMENT OF FINANCIAL POSITION AS AT 31 MARCH 2012

STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 MARCH 2012

STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 MARCH 2012

STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 MARCH 2012

2012 2011 Note R R

Assets Current assets 4 495 297 3 801 366 Other receivables 5 552 589 2 285 551 Cash and cash equivalents 6 3 942 708 1 515 815 Total assets 4 495 297 3 801 366 Equity and liabilities

Equity Accumulated funds 3 745 567 3 620 882

Current liabilities 749 730 180 484 Other payables 7 687 694 121 446 Leave pay accrual 7 62 036 59 038 Total equity and liabilities 4 495 297 3 801 366

2012 2011 Note R R Revenue 1.3 and 2 10 058 128 9 407 861 Income Donation income 10 054 669 9 399 337Mr Price Group bequests 8 845 000 8 600 000Mr Price Group staff, suppliers and customers 658 968 636 846 Mr Price Group fundraising 550 201 162 391 External party fundraising 500 100 Total income 10 054 669 9 399 337

Expenditure Administration and office expenditure 1 938 910 1 365 152Project disbursements 7 994 533 4 985 146 Total expenditure 9 933 443 6 350 298 Profit before finance income 3 121 226 3 049 039

Net finance income 3 459 8 494 Finance income 4 3 459 8 524Finance costs 4 - (30)

Profit for the year 124 685 3 057 533

Other comprehensive income - - Total comprehensive income for the year 124 685 3 057 533

Pg35

RedCap Foundation NPC - Annual Financial Statements at 31 March 2012 RedCap Foundation NPC - Annual Financial Statements at 31 March 2012

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 20121. ACCOUNTINGPOLICIES

1.1 BASIS OF PREPARATION The financial statements set out on pages 34-42 have been prepared on the historical cost basis except where otherwise stated, and incorporate the following principal accounting policies which conform to International Financial Reporting Standards (IFRS) and which are consistent with those applied in the previous year.

1.2 Adoption of new Standards and changes in accounting policies The following Interpretations were adopted during the year and did not lead to any changes in the Foundation’s accounting policies. • IAS 24 Related Party Disclosures (revised) 1 January 2011• IFRS 1 First-time Adoption of International Financial Reporting Standards – Limited Exemption from Comparative IFRS 7 Disclosures for First-time adopters (amendment) 1 July 2010• IFRIC 14 The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction – Prepayments of a Minimum Funding Requirement (amendment) 1 January 2011• Improvements to IFRSs Mostly 1 January 2011 1.2.1 Changes in accounting policies IAS 24 Related Party Transactions (revised): The IASB issued an amendment to IAS 24 that clarifies the definitions of a related party. The new definitions emphasise a symmetrical view of related party relationships and clarifies the circumstances in which persons and key management personnel affect related party relationships of an entity. In addition, the amendment introduces an exemption from the general related party disclosure requirements for transactions with government and entities that are controlled, jointly controlled or significantly influenced by the same government as the reporting entity. The adoption of the amendment did not have any impact on the financial position or performance of the Foundation as the definitions were already applied according to these amendments and the Foundation is not government related. IFRIC 14 Prepayments of a Minimum Funding Requirement (amendment): The amendment removes an unintended consequence when an entity is subject to minimum funding requirements and makes an early payment of contributions to cover such requirements. The amendment permits a prepayment of future service costs by the entity to be recognised as a pension asset. This had no impact in the current year. Improvements to IFRS: IFRS 7 Financial Instruments — Disclosures (Clarification of Disclosures): The amendment emphasises the interaction between quantitative and qualitative disclosures and the nature and extent of risks associated with financial instruments. The amendments to quantitative and credit risk disclosures involve: • Clarify that only financial assets with carrying amounts that do not reflect the maximum exposure to credit risk need to provide further disclosure of the amount that represents the maximum exposure to such risk.

• Require, for all financial assets, disclosure of the financial effect of collateral held as security and other credit enhancements, including the amount that best represents the maximum credit risk (e.g. a description of the extent to which collateral mitigates credit risk). • Remove the disclosure requirement of the collateral held as security, other credit enhancements and an estimate of their fair value for financial assets that are past due but not impaired, and financial assets that are individually determined to be impaired.

• Remove the requirement to specifically disclose financial assets renegotiated to avoid becoming past due or impaired.

1.2.1 Changes in accounting policies cont. • Clarify that the additional disclosure required for financial assets obtained by taking possession of collateral or other credit enhancements are only applicable to assets held at the reporting date.

This had no impact in the current year. IAS 1 Presentation of Financial Statements: The amendment clarifies that an entity may present an analysis of each component of other comprehensive income maybe either in the statement of changes in equity or in the notes to the financial statements. The Foundation provides these disclosures in the statement of changes in equity.

1.2.2 Statements, Interpretations or Standards in issue but not yet effective At the date of authorisation of these financial statements, the following Statements, Interpretations and Standards were in issue but not yet effective: Effective for annual Statement, Interpretation or Standard periods beginning on or after

• IAS 1 Financial Statement Presentation – Presentation of Items of Other Comprehensive Income 1 July 2012 • IAS 12 Income Taxes – Recovery of Underlying Assets 1 January 2012 • IAS 19 Employee Benefits (Amendment) 1 January 2013 • IAS 27 Separate Financial Statements (as revised in 2011) 1 January 2013 • IAS 28 Investments in Associates and Joint Ventures (as revised in 2011) 1 January 2013 • IFRS 1 First-time Adoption of International Financial Reporting Standards (Amendment) – Severe Hyperinflation and Removal of Fixed Dates for First-time Adopters 1 July 2011 • IFRS 7 Financial Instruments: Disclosures (Amendment) – Transfers of Financial Assets 1 July 2011 • IFRS 7 Financial Instruments: Disclosures (Amendment) – Disclosures – Offsetting Financial Assets and Financial Liabilities 1 January 2013• IFRS 9 Financial Instruments: Classification and Measurement 1 January 2015 • IFRS 10 Consolidated Financial Statements 1 January 2013 • IFRS 11 Joint Arrangements 1 January 2013 • IFRS 12 Disclosure of Involvement with Other Entities 1 January 2013 • IFRS 13 Fair Value Measurement 1 January 2013

The Directors anticipate that the adoption of the above in future periods will have no material financial impact on the financial statements of the Foundation and will only result in additional disclosure requirements with the exception of IFRS 9. The impact of this new statement is currently being assessed. These Statements, Interpretations and Standards will be adopted at the respective effective dates.

1.3 Revenue recognition Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Foundation and the revenue can be reliably measured. Revenue is measured at the fair value of the consideration received. Donation and fundraising income Donation and fundraising income are recognised when the income accrues to the Foundation. Interest income Revenue is recognised as the interest accrues (using the effective interest rate method that is the rate that exactly discounts estimated future cash receipts through the expected life of the financial instrument to the net carrying amount of the financial asset). 1.4 Borrowing costs Borrowing costs are capitalised where they are directly attributable to the acquisition, construction or production of a qualifying asset. All other borrowing costs are expensed in the period in which they occur. 1.5 Expenditure recognition Expenditure is recognised in profit or loss as incurred. Project disbursements comprise project travel expenses, catering costs, training, research, courier costs, uniforms, printing and stationery costs.

Pg37

RedCap Foundation NPC - Annual Financial Statements at 31 March 2012 RedCap Foundation NPC - Annual Financial Statements at 31 March 2012

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 20121. ACCOUNTINGPOLICIESCONTINUED

1.6 Financial instruments Financial instruments recognised on the statement of financial position include cash and cash equivalents, other receivables and other payables. Financial instruments are initially measured at fair value plus transaction costs. Subsequent measurement is dependent on their classification as described below: Other receivables Other receivables are classified as loans and receivables originated by the Foundation and are subsequently measured at amortised cost (using the effective interest rate method) less any impairment thereon. Other receivables are short term in nature and the effect of imputing interest is considered immaterial. Cash and cash equivalents These are classified as loans and receivables originated by the Foundation and are subsequently measured at amortised cost. Cash and cash equivalents comprise cash at bank and cash on hand. Other payables Other payables are classified as financial liabilities and are subsequently carried at amortised cost using the effective interest rate method. Payables are short term in nature and the effect of imputing interest is considered to be insignificant. Derecognition of financial assets and liabilities a) Financial assets A financial asset (or where applicable, a part of a financial asset or part of a group of similar financial assets) is derecognised where: • the rights to receive cash flows from the asset have expired; • the Foundation retains the right to receive cash flows from the asset, but has assumed an obligation to pay them in full without material delay to a third party under a ‘pass-through’ arrangement; or • the Foundation has transferred its rights to receive cash flows from the asset and either (a) has transferred substantially all the risks and rewards of the asset, or (b) has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

Where the Foundation has transferred its rights to receive cash flows from an asset and has neither transferred nor retained substantially all the risks and rewards of the asset nor transferred control of the asset, the asset is recognised to the extent of the enterprise’s continuing involvement in the asset. Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the enterprise could be required to repay. (b) Financial liabilities A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires.

Where an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognised in profit or loss. Impairment of financial assets The Foundation assesses at each balance sheet date whether a financial asset or group of financial assets is impaired.

a) Assets carried at amortised costThe Foundation first assesses whether objective evidence of impairment exists individually for financial assets that are individually significant, and individually or collectively for financial assets that are not individually significant. If it is determined that no objective evidence of impairment exists for an individually assessed financial asset, whether significant or not, the asset is included in a group of financial assets with similar credit risk characteristics and that group of financial assets is collectively assessed for impairment. Assets that are individually assessed for impairment and for which an impairment loss is or continues to be recognised are not included in a collective assessment of impairment.

If there is objective evidence that an impairment loss on loans and receivables carried at amortised cost has been incurred, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of the estimated future cash flows (excluding future credit losses that have not been incurred) discounted at the financial asset’s original effective interest rate (i.e. the effective interest rate computed at initial recognition). The carrying amount of the asset shall be reduced either directly or through use of an allowance account. The amount of the loss shall be recognised in profit or loss. If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed. Any subsequent reversal of an impairment loss is recognised in profit or loss, to the extent that the carrying value of the asset does not exceed its amortised cost at the reversal date. 1.7 Leave pay accrualThe leave pay accrual comprises the leave entitlement in respect of the staff of the Foundation. Employee benefits in the form of annual leave entitlements are provided for when they accrue to employees with reference to services rendered up to the reporting date. It has been calculated based on leave days due at reporting date and the cost to company per employee.

1.8 Taxation Current income taxThe Foundation has been approved as a public benefit organisation in terms of Section 30 of the Income Tax Act and the receipts and accruals are exempt from Income Tax in terms of Section 10(1)(cN) of the Income Tax Act. Value added tax Expenses and assets are recognised net of the amount of value added tax.

In terms of the Value Added Tax Act, the Foundation is exempt from value added tax on donations received.

Pg39

RedCap Foundation NPC - Annual Financial Statements at 31 March 2012 RedCap Foundation NPC - Annual Financial Statements at 31 March 2012

8.1 Cash generated from operations Net income for the year 124 685 3 057 533 Finance income (3 459) (8 524) Finance costs - 30 Non-cash Items 2 998 8 439 124 224 3 057 478 Working capital changes 2 299 210 (2 145 358) Decrease / (increase) in other receivables 1 732 962 (1 816 483) Increase / (decrease) in other payables 566 248 (328 875)

Cash generated from operations 2 423 434 912 120

8. Note to the statement of cash flows

9. Financial instrumentsThe Foundation’s principal financial instruments comprise cash and short-term deposits. The Foundation has various other financial assets and liabilities such as other receivables and payables, which arise directly from its operations. It is, and has been throughout the year under review, the Foundation’s policy that no trading in financial instruments shall be undertaken. The Foundation does not trade.

9.1 Liquidity risk management Liquidity risk is defined as the risk that the Foundation would not be able to settle or meet its obligations on time or at a reasonable price.

The Foundation has minimised its liquidity risk by ensuring that it has adequate banking facilities. The Foundation’s financial liabilities are all short-term in nature and hence no further maturity analysis has been performed. The Foundation expects to meet its obligations from existing cash reserves and from operating cash flows.

9.2 Credit risk managementCredit risk is the risk that a counterparty will not meet its obligations under a financial instrument leading to a financial loss. The Foundation is not exposed to credit risk as it does not have trade receivables. With respect to credit risk relating to cash and cash equivalents and other receivables, the Foundation’s exposure to credit risk arises from the default of the counterparty with the maximum exposure equal to the respective carrying amounts.

9.3 Interest rate risk management Net finance income represents an insignificant amount and hence no sensitivity anlaysis has been presented.

9.4 Fair value of financial instruments Fair value is defined as the amount for which the instrument could be exchanged in a current transaction between knowledgeable willing parties in an arms-length transaction, other than in a forced or liquidation sale. The fair values of the Foundation’s financial instruments, which principally comprise bank and cash balances, receivables and payables approximate their statement of financial position carrying values.

9.5 Classification of financial instruments Loans and receivables 2012 2011 R RCurrent assets Other receivables 552 589 2 285 551 Cash and cash equivalents 3 942 708 1 515 815 Total 4 495 297 3 801 366 Financial liability at amortised cost

Current liabilities Other payables 687 694 121 446 Leave pay accruals 62 036 59 038 Total 749 730 180 484

10. Related partiesDonations to the value of R8 845 000 (2011: R8 600 000), were received from Mr Price Group Limited during the current financial year. The Foundation was established to carry out Corporate Social Investment Initiatives of Mr Price Group Limited. In addition, Mr Price Home and Sheet Street Dvisions of Mr Price Group Limited undertook fundraising projects on behalf of the Foundation, raising funds of R145 022 (2011: R158 996) and Rnil (2011: R395) respectively. The balance owing to Mr Price Group Limited as at 31 March 2012 amounts to R92 244 (2011: owed by Mr Price Group Ltd R2 262 781).

2.REVENUE

3. PROFIT BEFORE FINANCE INCOME

4. FINANCE INCOME & FINANCE COSTS

5. OTHER RECEIVABLES

6. CASH & CASH EQUIVALENTS

7. OTHER PAYABLES

2012 2011 R R

2. RevenueRevenue is comprised of the following: Donation income 10 054 669 9 399 337 Finance income 3 459 8 524 10 058 128 9 407 861

3. Profit before finance incomeNet profit before finance income is stated after taking the following into account: Expenditure Employment costs 1 173 207 894 982 Service providers 5 413 535 2 807 829

4. Finance income and finance costs Finance income Interest received from financial institutions 3 459 8 524 Finance costs Interest paid to financial institutions - 30

5. Other receivables

VAT receivables 526 540 23 770 Other 26 049 2 261 781 552 589 2 285 551

6. Cash and cash equivalents

Current bank accounts 3 942 708 1 515 815

7. Other payables

Accruals 687 694 121 446 Leave pay accrual 62 036 59 038 749 730 180 484

Accruals are non-interest bearing and are normally settled on presentation of invoice.

8.NOTE TO THE STATEMENT OF CASH FLOWS

9.FINANCIALINSTRUMENTS

10.RELATED PARTIES

Pg41

RedCap Foundation NPC - Annual Financial Statements at 31 March 2012 RedCap Foundation NPC - Annual Financial Statements at 31 March 2012

Inspiring Tomorrow’s Heroes

www.redcapfoundation.org