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TRANSCRIPT
2012/2013 IN YEAR FINANCIAL MONITORING REPORT
FOR THE PERIOD: 01st
JULY 2012 to 30th
JUNE 2013
FOURTH QUARTER
2
TABLE OF CONTENTS 1. Introduction….............................................................................................5 2. Executive Summary...................................................................................6-8 3. Financial Performance (Expenditure & Revenue)....................................9-23 4. Capital Budget Performance………………………..…………….….………24-29 5. Cash Flow Position.....................................................................................30-33 6. Current Bank Balance, Investment and Borrowing......................................34-35 7. Performance on main tariff revenue collection……………………………......36-46
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IN-YEAR BUDGET STATEMENT TABLES: JUNE 2013 REPORT
The financial results for the period ended 30th June 2013 (the 12th month of the 2012/2013 financial year) are attached consisting of the following tables, in Annexure A and Annexure B:
ANNEXURE A: 1) Table C1: Monthly Budget Statement – Summary 2) Table C2: Monthly Budget Statement – Financial Performance (standard
classification) 3) Table C3: Monthly Budget Statement - Financial Performance (Revenue and
Expenditure by Municipal vote) 4) Table C4: Monthly Budget Statement – Financial Performance (Revenue and
Expenditure) 5) Table C5: Monthly Budget Statement - Capital Expenditure by vote, standard
classification and funding 6) Table C6: Monthly Budget Statement – Financial Position 7) Table C7: Monthly Budget Statement – Cash Flow
ANNEXURE B: 1) Table SC1: Material variance explanations 2) Table SC2: Monthly Budget Statement – Performance Indicators 3) Table SC3: Monthly Budget Statement - Aged Debtors 4) Table SC4: Monthly Budget Statement - Aged Creditors 5) Table SC5: Monthly Budget Statement – Investment Portfolio 6) Table SC6: Monthly Budget Statement – Transfer and grant receipts 7) Table SC7: Monthly Budget Statement – Transfer and grant expenditures 8) Table SC8: Monthly Budget Statement – Councillor and Staff Benefits 9) Table SC9: Monthly Budget Statement – Actual and Revised targets for cash
receipts 10) Table SC12: Monthly Budget Statement – Capital Expenditure Trend 11) Table SC13a: Monthly Budget Statement – Capital expenditure on new assets by
asset class 12) Table SC13b: Monthly Budget Statement – Capital expenditure on renewal of
existing assets by asset class 13) Table SC13c: Monthly Budget Statement – Capital expenditure on repairs and
maintenance by asset class 14) Table SC13d: Monthly Budget Statement – Depreciation by asset class 15) Municipal manager’s quality certification
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ANNEXURE A:
1) Table 1: Capital Expenditure to date – by Capital Projects 2) Table 2: Capital Expenditure to date – payments from Cash Flow 3) Table 3: Activity Report 4) Table 4: Staff Arrears Service Accounts 5) Table 5: Councillors Service Accounts 6) Table 6: Investment Register 7) Table 7: Loan Register 8) Table 8: Quarterly Withdrawal Bank Statement
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1. INTRODUCTION
1.1 PURPOSE
The purpose of this report is to inform Council about the Financial Status quo of Mogale City Local Municipality and to comply with Sections 71 of the MFMA and the requirements as promulgated in the Government Gazette No 32141 of 17th April 2009.
1.2 STRATEGIC OBJECTIVE The application of sound financial management principles for the compilation of Mogale City’s financial plan is essential and critical to ensure that municipality remains financial viable and those sustainable municipal services are provided economically and equitably to all communities.
1.3 BACKGROUND
Section 52(d) and Section 71 of the MFMA and in terms of Section 28 of the Government Notice 32141 dated 17 April 2009, regarding the “ Local Government: Municipal Finance Management Act 2003 Municipal Budget and Regulations” necessitates that specific financial particulars be reported on and in the format prescribed. “Section 52(d) of the MFMA states that the mayor of the municipality must, within 30 days of the end of each quarter, submit a report to the council on the implementation of the budget and the financial state of affairs of the municipality;” “Section 71 (1) of the MFMA states that, The accounting officer of a municipal must by no later than 10 working days after the end of each month submit to the mayor of the municipality and the relevant provincial treasury a statement in the prescribed format on the state of the municipality’s budget reflecting the following particulars for that month and for the financial year up to the end of that month.” “Section 28 of the Government Notice 32141, the monthly budget statement of a municipality must be in the format specified in Schedule C and include all required tables, charts and explanatory information, taking into account any guidelines issued by the Minister in terms of section 168(1) of the Act.”
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2. EXECUTIVE SUMMARY 2.1 SUMMARY STATEMENT OF FINACIAL PERFORMANCE Table 1: Operational Budget performance for the year to 30th June 2013
2012/2013 Approved
Adjustment Budget
R 000
Actual income/spend to date (in R and as a
% of the Approved Adjustment Budget)
R 000 %
Pro-rata
Budget to date
R 000
Under/ over
spend against Pro rata budget
R 000
Actual income/ spent as % of pro
rata budget
Revenue 1 700 259 1 693 140 100% 1 700 259 (7 120) 100%
Expenditure cash items (1 702 828) (1 526 942) 90% (1 702 828) (175 886) 90%
Expenditure non-cash items (depreciation, debt impairment and others)
(309 696) (282 400) 91% (282 400) (27 296) 91%
TOTAL EXPENDITURE (2 012 524) (1 809 342) 90% (2 012 524) (203 182) 90%
SURPLUS/ (DEFICIT)
(312 264)
(116 202)
7%
(312 265)
196 063
12%
Note: Positive (Expenditure) & Negative Revenue
2.1.1 During the 2012/13 financial year we anticipated to raise R1 762 640 480 in billed revenue and operational grants, this amount was revised to an amount of R1 700 259 791 excluded here is the capital grants amounting to a total of R119 870 700, and this has also been revised to R 127 972 715.
2.1.2 In line with the formats prescribed by the Municipal Budget and Reporting Regulations, capital transfers and contributions are excluded from the operating statement, as inclusion of these revenue sources would distort the calculation of the operating surplus/ (deficit).
2.1.3 The summary of statement of financial performance in Annexure A, Table C4, is prepared on a similar basis to the prescribed budget format, detailing revenue by source type and expenditure by input type.
2.1.4 To date, a total of R 1 809 342 billion has been spent on the operational
approved budget this includes non-cash items, (this represent 90% of the total approved expenditure budget for the year or 90% of the pro rata budget). These figures include non-cash items such as depreciation, debt impairment, year-end provisions and municipal charges.
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2.1.5 To date a total revenue of R1 693 140 billion has been recorded
(representing 100% of the total approved adjustment revenue budget for the year or 100% pro rata budget), this amount is made up of revenue billed from main tariffs and revenue from other sources amounting to R1 259 282 million and R433 858 million respectively. Section 2 of this report gives more detail on the Operational Budget Performance.
2.1.6 The revenue shown on table 2.1.8. below is largely the amount of revenue
billed for the year to date of R1 259 282 million, representing 74% of the total revenue, it should also be noted that of the total revenue received, an amount R340 928 million came from operational grants, this actually translates into R92 930 million being revenue from other sources, which represents 5% of the total income.
2.1.7 The amount of actual cash collected or received for the main tariffs is an
amount R1 180 504 million (representing 94% of the billed revenue) as shown on table 2.1.8 and in detail on section 7 of this report.
Chart 1 Monthly Expenditure Trends
Note: This chart includes depreciation and debt impairment which are non-cash items
The chart above shows that R190 881 million was spent for the month of June 2013.
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Table 1.1 Monthly Creditors age analysis – M12 June
Budget Year 2012/13
Detail
0 - 30 Days
31 - 60 Days
61 - 90 Days
91 - 120
Days
121 - 150
Days Total
-
Bulk Electricity 56,651,098 21,560,170 0 0 0 78,211,268
Bulk Water 14,844,623 0 0 0 0 14,844,623
PAYE deductions 4,938,851 0 0 0 0 4,938,851
VAT (output less input) 4,434,867 0 0 0 0 4,434,867
Pensions / Retirement deductions 6,232,127 0 0 0 0 6,232,127
Loan repayments 3,290,137 0 0 0 0 3,290,137
Trade Creditors 62,806,932 183,288 2,834 119,075 0 63,112,129
Auditor General 0 0 0 0 0 0
Other 1,093,500 500 0 0 0 1,094,000
Total 154,292,135 21,743,958 2,834 119,075 0 176,158,002
Eskom 57,355,348 21,560,170 0 0 78,915,518
Rand Water 14,076,581 0 0 0 0 14,076,581
South African Revenue Service 9,373,718 0 0 0 0 9,373,718
Vision Active 6,996,930 0 0 0 0 0
Pro-Plan Consulting Engineers 5,423,468 0 0 0 0 5,423,468
Twin-M Plant Hire 3,861,492 0 0 0 0 3,861,492
Actom Switchgear 2,923,587 0 0 0 0 2,923,587
Inkolelo Trading 371 CC 2,613,563 0 0 0 0 2,613,563
Tecroveer & Ron 2,576,296 24,326 0 0 0 2,600,622
Scifin Pty Ltd 2,264,717 0 0 0 0 2,264,717
Other Trade Creditors 46,826,435 159,462 2,834 119,075 0 47,107,806
Total 154,292,135 21,743,958 2,834 119,075 0 176,158,002
Note: This table depicts the monthly aging of the creditors for the month of June 2013
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2.1.8 PERFORMANCE ON REVENUE COLLECTION Table 2: Billed income – amount billed to date and cash received. Figures in R 000
Periods Amount billed for year to date
Cash received as at 30th June 2013
Collection rate as at 30th June
2013
July 2012 104 733 89 352 85%
August 2012 113 339 105 710 93%
September 2012 120 702 99 501 82%
October 2012 112 222 109 373 97%
November 2012 98 677 108 772 110%
December 2012 108 669 101 927 94%
January 2013 98 684 94 877 96%
February 2013 100 718 85 053 84%
March 2013 97 092 90 381 93%
April 2013 95 449 99 941 105%
May 2013 103 597 102 309 99%
June 2013 105 400 93 308 89%
Total 1 259 282 1 180 504 94%
Note: This table excludes service reconnections and sundry billing. Billing is only on Property Rates and four main tariffs.
The Cumulative Collection Rate as at the end of June 2013 stands at 94% - that is the amount of cash that has been received to date for the year is 94% of the billed amount. The collection rate for the month of June 2013 is 89%, more information and detail on this performance is given in section 7 of the report.
10
Chart 2 Monthly Collection Rate
Note: This chart depicts the actual revenue collected
The chart above shows that R93 308 million was collected for the month of June 2013.
Table 1.2 Monthly Debtors age analysis SC3 Monthly Budget Statement - aged debtors – M12 June
Description Budget Year 2012/13
0-30 Days 31-60 Days 61-90 Days 91-120 Days Total
R thousands
Debtors Age Analysis By Revenue Source
Rates 69,720,103 1,864,188 1,702,695 124,007,429 197,294,415
Electricity 93,823,880 1,990,327 1,037,989 132,958,813 229,811,008
Water 37,587,927 2,942,453 2,381,858 140,213,030 183,125,268
Sewerage / Sanitation 26,117,594 2,084,357 1,546,018 16,119,632 45,867,601
Refuse Removal 33,574,192 2,232,926 1,862,119 22,070,077 59,739,314
Housing (Rental Revenue) 469,861 60,472 48,613 908,308 1,487,255
Other 47,722,744 3,799,077 2,817,576 151,309,532 205,648,928
Total By Revenue Source 309,016,301 14,973,799 11,396,868 587,586,820 922,973,788
Debtors Age Analysis By Customer Category
Government 7,070,469 2,856,388 869,690 9,512,902 20,309,449
Business 89,592,941 1,510,668 1,095,817 90,557,149 182,756,575
Households 204,886,825 9,996,409 8,903,390 238,897,196 462,683,820
Other 7,466,066 610,334 527,971 248,619,574 257,223,945
Total By Customer Category 309,016,301 14,973,799 11,396,868 587,586,820 922,973,788
Note: This table depicts the monthly aging of the debtors for the month of June 2013.
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Table 3: Capital Budget performance for the year to 30th June 2013
2012/2013
Approved Adjusted Budget
R 000
Actual spend to date (in R and as a % of the
Approved Adjustment
Budget)
R 000 %
Pro rata
Budget to date
R 000
Under over
spend against pro rata budget R 000
% of pro rata budget spent
%
EXPENDITURE 358 512 309 611 86% 358 512 48 901 86%
2.1 To date, there has been spending amounting to R309 611 million from the capital
budget (this represents 86% of the total approved adjusted expenditure budget for year). Section 3 of this report gives more detail on this performance.
Chart 3 2012/13 Capital Expenditure Monthly Trends: actual v target
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Chart 4 2012/13 Capital Expenditure: YTD actual v YTD target
13
2.3 CASH FLOW REPORT OF MOGALE CITY FOR JUNE 2013: Table 4: Cash Flow Position as at 30th June 2013. Figures in Rm's
Cash balance brought forward from 2011/12 22,073
Cash received for the year to date 2,061,830
Cash payments made for the year to date (2,016,354)
Current cash position 67,549
2.3.1 Mogale City's cash in hand as at the end of June 2013 was R 67,549m amount
was made up as follows:
Source RM Investec - ( Sars) 29,779
Grants Account 36
Social Responsibility funds-account 1,570
Social Responsibility funds-90 days 4,000
Sanlam Shares 449
Bank Balance 31,715
Total cash in hand 67,549
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2.3.2 The Operating Income for the month of June 2013 was R13 869m less than the operating income for the month of May 2013 and the operating expenditure was R24,488m more than that of the previous month. The operating income excludes income derived from operational grants and this depicts that Mogale City is dependent on grants than own generated revenue. Month Operating
Income Operating Expenditure
Difference
RM RM RM
Jul-12
115,833
183,428
-67,595
Aug-12
152,264
140,768
11,496
Sep-12
114,993
131,225
-16,232
Oct-12
145,051
135,850
9,201
Nov-12
140,518
147,854
-7,336
Dec-12
122,111
187,334
-65,223
Jan-13 153,513 148,443 5,070
Feb-13 109,597
77,924
31,673
Mar-13 116,196 202,839 -86,642
April -13
121,415
88,873
32,542
May-13
133,903
128,136
5,768
June-13 120,034 152,624 -32,590
Total 1,545,428
1,728,298
-179,869
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2.3.3 The month of June 2013 shows the collections rates of 94% and the operating income was R32,590m less than the operating expenditure. The year to date shortage is R179,869m . Chart: Performance of Operating Income vs Operating Expenditure
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BANK BALANCE, INVESTMENTS, AND BORROWING Table 5: Key Treasury Information as at 30
th June 2013
Previous Month Current Position Change from previous month
Balance in current account -R 1,074,495 R31,715,179 Increase R 30,640,684
Total investments held : Uncommitted Call (Sanlam Shares) R 462,624 R 448,960 Decrease -R 13,664
Committed MIG grant Call
R 5,943,012 R 0 Decrease -R 5,943,012
Committed Loan Funds Call R 18,363,481 R 29,778,601 Increase R11,415,119
Committed Mig Grants Call R 41,919,995 R 0 Decrease -R 41,919,995
Commited Sars & Loan Funds R 50,000,000 R 0 Decrease -R 50,000,000
Committed Social responsibility-90 days Fixed Deposit R 4,000,000 R 4,000,000 No Movement R 0
Committed : Fixed Deposits R 68,293,514 R 69,076,453 Increase R 782,939
Total external borrowing R 324,096,384 R 366,642,398 increase R42,546,214
More information on these treasury matters is given in section 5 of this report.
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3 . FINANCIAL PERFORMANCE (EXPENDITURE BY MUNICIPAL VOTE)
Consolidated Monthly Budget Statement - Financial Performance expenditure by municipal vote) - M12 June
Vote Description 2011/12 Budget Year 2012/13
R thousand Audited
Outcome Original Budget
Adjusted Budget
Monthly actual
YearTD actual
YearTD budget
overs/unders against ytd
budget
YTD actual as a %
pro rata budget
%
Expenditure by Vote –
Vote 1 - POLITICAL OFFICE
27,647
52,860
56,907
6,044
46,709
56,907 10,198 82%
MAYOR'S OFFICE
13,457
28,212
31,969
3,299
26,680
31,969 5,290 83%
SPEAKER'S OFFICE
14,190
24,648
24,937
2,745
20,029
24,937 4,908 80%
Vote 2 - MUNICIPAL MANAGERS OFFICE
48,081
53,897
73,267
6,132
56,927
73,267 16,340 78%
ADMINISTRATION(MUNICIPAL MANAGER)
1,784
4,969
6,987
327
4,105
6,987 2,882 59%
CHIEF OPERATING OFFICER
2,136
3,677
3,206
401
3,211
3,206 (5) 100%
INTERNAL AUDIT
4,071
5,523
5,257
377
4,955
5,257 302 94%
PROJECT MANAGEMENT UNIT
2,185
4,692
1,918
117
1,641
1,918 277 86%
IDP & IGR
2,417
2,690
7,579
300
7,579
7,579 (0) 100%
MONITORING & EVALUATION
805
983
1,107 4
425
1,107 682 38%
INFORMATION MANAGEMENT
34,681
31,363
47,213
4,606
35,011
47,213 12,203 74%
Vote 3 - CORPORATE SUPPORT SERVICES
64,345
93,915
90,263
8,106
75,209
90,263 15,054 83%
ADMINISTRATION(EXECUTIVE MANAGER)
7,042
6,036
4,996
358
4,050
4,996 945 81%
LEGAL SERVICES
15,269
19,900
20,173
2,042
19,483
20,173 690 97% INTERGOVERMENTAL & CORPORATE
ADMIN
16,293
28,650
26,674
2,406
23,732
26,674 2,941 89%
HUMAN CAPITAL MANAGEMENT
16,694
23,216
27,708
2,391
20,245
27,708 7,463 73%
MARKETING & COMMUNICATION
9,047
16,112
10,713
907
7,699
10,713 3,015 72%
Vote 4 - MUNICIPAL FINANCIAL SERVICES
196,578
193,388
225,611
14,620
173,339
225,611 52,272 77%
ADMINISTRATION(CFO)
6,838
6,981
5,238
196
4,099
5,238 1,140 78%
VALUATIONS
3,355
10,345
8,708
1,986
6,574
8,708 2,135 75%
REVENUE
82,041
52,200
56,841
3,822
55,903
56,841 938 98%
CREDIT CONTROL
34,484
38,422
40,689
2,793
36,470
40,689 4,220 90%
CREDITORS
14,225
15,080
52,682
2,779
17,220
52,682 35,463 33%
SUPPLY CHAIN MANAGEMENT
39,011
13,916
15,219
1,473
14,461
15,219 758 95%
BUDGET & TREASURY
16,624
56,443
46,233
1,571
38,614
46,233 7,619 84%
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Consolidated Monthly Budget Statement - Financial Performance expenditure by municipal vote - M12 June (continues)
Vote Description 2011/12 Budget Year 2012/13
R thousand Audited
Outcome Original Budget
Adjusted Budget
Monthly actual
YearTD actual
YearTD budget
overs/unders against ytd
budget
YTD actual as a %
pro rata
budget
%
Expenditure by Vote
Vote 5 - INTEGRATED ENVIRONMENTAL MANAGEMENT
180,388
160,353
174,094
12,484
158,839
174,094 15,255 91%
ADMINISTRATION(EXECUTIVE MANAGER) 2,248 2,399 2,007
138 2,131
2,007 (124) 106%
ENVIRONMENTAL MANAGEMENT 12,816 14,348 14,626
734 6,342
14,626 8,284 43%
MUNICIPAL HEALTH
122,898 89,707
104,003
7,718
104,829
104,003 (826) 101%
PARKS MANAGEMENT 42,426 53,900 53,458
3,895
45,536
53,458 7,922 85%
Vote 6 - SOCIAL SERVICES
184,845
193,195
198,761
19,485
195,194
198,761 3,567 98%
ADMINISTRATION(EXECUTIVE MANAGER) 28,887 4,183 3,985
2,049
24,382
3,985 (20,398) 612%
SOCIAL UPLIFTMENT 13,574 19,514 21,043
1,113
12,975
21,043 8,068 62%
SPORTS,RECREATION,LIBRARIES,HERITAG E & MUSEUM 37,515 49,841 54,054
3,438
38,217
54,054 15,837 71%
LICENCES 12,069 13,716 13,905
1,031
12,608
13,905 1,297 91%
PUBLIC SAFETY 92,559
105,668
105,545
11,847
106,831
105,545 (1,286) 101%
CLINICS 242 273 228 8 180
228 48 79%
Vote 7 - ECONOMIC SERVICES 36,630 44,881 39,470
3,350
31,233
39,470 8,236 79%
DEVELOPMENT & PLANNING 15,646 17,665 16,661
1,193
14,219
16,661 2,442 85%
ENTERPRISE DEVELOPMENT & TOURISM 3,883 4,124 4,647
608 5,525
4,647 (878) 119%
RURAL DEVELOPMENT 8,302 11,366 7,262
647 4,439
7,262 2,822 61%
HUMAN SETLLEMENTS 8,799 11,726 10,901
902 7,050
10,901 3,850 65%
Vote 8 - INFRASTRUCTURE SERVICES
998,518
1,094,801
1,154,151
120,660
1,071,892
1,154,151 82,259 93%
ADMINISTRATION(EXECUTIVE MANAGER) 2,266 2,477 2,620
174 2,276
2,620 345 87%
WATER & SANITATION
297,429
331,395
362,682
33,351
306,250
362,682 56,433 84%
FLEET MANAGEMENT 2,005 7,451 6,779
454 5,935
6,779 844 88%
ELECTRICITY DISTRIBUTION
530,517
585,748
596,277
68,017
581,333
596,277 14,944 97%
MUNICIPAL BUILDINGS 36,171 36,034 37,267
4,836
32,744
37,267 4,523 88%
ROADS & STORMWATER
130,129
131,697
148,526
13,827
143,355
148,526 5,170 97%
Total Expenditure by Vote
1,737,031
1,887,291
2,012,524
190,881
1,809,342
2,012,524 203,182 90%
3.3.1. This table shows expenditure of June 2013 from the operational budget these include non-cash items. The spend-to-date represents 90% of the total Approved Adjustment Budget or 90% of the pro rata budget. The following variances are worth noting.
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o The following departments have over expenditure as compared to their pro rata
budget, however it should be noted that when compared with their annual budgets they are still within the budgeted amounts.
Intergrated Environmental Management – here the biggest contributors are
mainly non cash item that is depreciation, interest, internal charges and indigent subsidies.
Social Services – the over expenditure in this department is as a result of a the backdating of depreciation and employee related cost under Public Safety.
Economic services – the biggest contributor are employee related costs under enterprise development.
20
Table C4 Monthly Budget Statement - Financial Performance expenditure - M12 June
Description
2011/12 Budget Year 2012/13
Audited Outcome
Original Budget
Adjusted Budget
Monthly actual
YearTD actual
YearTD budget
overs/unders against ytd
budget
YTD actual as a %
pro rata
budget
R thousands %
Expenditure By Type
Employee related costs 397,068 461,056 466,425 38,660 445,165 466,425 21,259 95%
Remuneration of councillors 17,954 21,930 21,930 1,620 19,019 21,930 2,910 87%
Debt impairment 86,052 50,578 70,063 5,839 70,063 70,063 (0) 100%
Depreciation & asset impairment 236,930 195,492 239,634 17,482 212,337 239,634 27,296 89%
Finance charges 45,285 44,417 51,632 2,575 34,647 51,632 16,985 67%
Bulk purchases 540,935 620,860 633,459 65,250 607,147 633,459 26,312 96%
Contracted services 147,169 225,119 231,798 24,189 158,705 231,798 73,093 68%
Transfers and grants 19,893 20,859 31,083 3,458 31,757 31,083 (674) 102%
Other expenditure 245,744 246,981 266,501 31,809 230,501 266,501 35,999 86%
Total Expenditure 1,737,031
1,887,291 2,012,524 190,881 1,809,342
2,012,524 203,182 90%
3.3.2.1 Annexure A, Table C4 sets out the monthly expenditure to date on the operating budget analysed by type.
In overall terms expenditure on employees’ costs and remuneration to council is 95% of the total Approved Budget for the year or 95% of pro rata budget.
3.3.3.2 The discussion set out below looks at the major (under) and over
expenditure on individual budgets.
o Interest on External borrowings - Expenditure on this item is 67% of the total Approved Budget for the year. The interest payments are contractually fixed but vary on a monthly basis due to different banks being involved and different payment dates agreed to.
o Insurance Costs - R1 778 million has been spent to date (98%) of the
Approved Budget for the year).
o Depreciation – this cost item is now being allocated on a month to month basis in accordance with the Fixed Assets Management Policy as approved, this policy determines, amongst other things the expected useful life of different classes of assets, the asset unit calculates this amounts monthly based on the policy.
3.3.2.3 EXPENDITURE ON STAFF BENEFITS
21
Supporting Table SC8 Monthly Budget Statement - councillor and staff benefits - M12 June
Summary of Employee and Councillor remuneration
2011/12 Budget Year 2012/13
Audited Outcome
Original Budget
Adjusted Budget
Monthly actual
YearTD actual
YearTD budget
overs/unders against ytd
budget
YTD actual as a %
pro rata
budget
Councillors (Political Office Bearers plus Other)
Basic Salaries and Wages 10,658
14,114 14,114
986
11,462
14,114 2,652 81%
Pension and UIF Contributions 1,624
1,670 1,670
141
1,678
1,670 (8) 100%
Medical Aid Contributions 564
604 604
48
569
604 36 94%
Motor Vehicle Allowance 4,213
4,596 4,596
367
4,374
4,596 223 95%
Cellphone Allowance 895
945 945
79
936
945 8 99%
Sub Total - Councillors 17,954
21,930 21,930
1,620
19,019
21,930 2,910 87%
Senior Managers of the Municipality
Basic Salaries and Wages 7,813
9,660 9,007
743
8,908
9,007 100 99%
Pension and UIF Contributions 818
557 567
47
565
567 1 100%
Medical Aid Contributions
113 63 9
111
63 (48) 177%
Performance Bonus 924
1,400 2,606 –
764
2,606 1,841 29%
Motor Vehicle Allowance 1,176
1,613 1,433
119
1,433
1,433 – 100%
Sub Total - Senior Managers of Municipality 10,731
13,343 13,675
919
11,781
13,675 1,894 86%
Other Municipal Staff
Basic Salaries and Wages 246,599
286,083 295,589
23,625
274,088
295,589 21,501 93%
Pension and UIF Contributions 48,687
57,876 57,753
4,484
53,535
57,753 4,219 93%
Medical Aid Contributions 15,779
18,457 17,228
1,535
17,458
17,228 (230) 101%
Overtime 16,706
13,100 19,541
1,938
19,087
19,541 454 98%
Performance Bonus 19,458
26,211 27,377
1,428
21,884
27,377 5,493 80%
Motor Vehicle Allowance 30,059
35,211 34,353
2,822
32,150
34,353 2,204 94%
Housing Allowances 3,311
3,554 3,438
293
3,529
3,438 (91) 103%
Payments in lieu of leave 7,862
1,300 1,544 –
1,695
1,544 (151) 110%
Payments in lieu of long service – – 2,137
301
3,065
2,137 (928) 143%
Payments in lieu of resignations & retirements – – 789
341
1,211
789 (422) 153%
Long service awards 149
144 112 –
112
112 – 100%
Post-retirement benefit obligations
(2,273)
5,776 5,776
974
5,572
5,776 205 96%
Sub Total - Other Municipal Staff 386,337
447,713 465,637
37,741
433,384
465,637 32,253 93%
TOTAL SALARY, ALLOWANCES & BENEFITS 415,022
482,985 501,242
40,280
464,184
501,242 (37,057) -7%
TOTAL MANAGERS AND STAFF 397,068
461,056 479,312
38,660
445,165
479,312 34,147 7%
22
3.3.2.4 Section 66 of the MFMA (Municipal Finance Management Act, 2003) requires that expenditures incurred by the municipality on staff salaries; wages, allowances and benefits are regularly reported to Council. This information is given in Annexure A, Table SC8 above for this report, along with the equivalent information on Councillor Allowances.
3.3.2.5 Total expenditure on staff and councillor benefits is 95% of the total Approved
Budget or 95% pro rata budget.
o Leave payments (Normal, long service, retirements & resignations) has overspent on pro rata budget. The main reason for that is that despite a resolution of Executive Committee not to make leave payments, we are obliged by law to make payments in respect of resignations and retirements.
Table C4 Monthly Budget Statement - Financial Performance revenue - M12 June
Description
2011/12 Budget Year 2012/13
Audited Outcome
Original Budget
Adjusted Budget
Monthly actual
YearTD actual
YearTD budget
overs/unders againt ytd budget
YTD actual as a %
pro rata
budget
R thousands %
Revenue By Source
Property rates
247,753
286,767
265,995
22,197 262,768
265,995 3,227 99%
Service charges - electricity revenue
619,676
765,628
741,308
61,029 702,284
741,308 39,024 95%
Service charges - water revenue
169,383
190,728
189,237
16,351 187,072
189,237 2,165 99%
Service charges - sanitation revenue
85,747
103,112
99,494
7,448 92,641
99,494 6,853 93%
Service charges - refuse revenue
76,556
80,947
87,271
7,686 88,695
87,271 (1,424) 102%
Service charges - other
11,725
15,715
17,101
3,700 20,866
17,101 (3,765) 122%
Rental of facilities and equipment
3,149
3,819
2,990
186 2,818 2,990 173 94%
Interest earned - external investments
4,730 619
974 – 10,757 974 (9,783) 1104%
Interest earned - outstanding debtors
10,204
16,758
8,550
1,123 10,325 8,550 (1,775) 121%
Fines
11,036
16,923
6,777
3,006 9,477 6,777 (2,700) 140%
Licences and permits 23 26 16 1 17 16 (1) 104%
Agency services
19,075
17,266
19,075
9,319 22,780
19,075 (3,704) 119%
Transfers recognised - operational
201,608
227,133
228,316
1,159 226,078
228,316 2,238 99%
Other revenue
210,870
30,299
33,002
2,362 56,847
33,002 (23,844) 172%
Gains on disposal of PPE –
6,900
150
(18) (285) 150 435 -190%
Total Revenue (excluding capital transfers and contributions)
1,671,534
1,762,640
1,700,260
135,548 1,693,140
1,700,260 7,120 100%
3.4.1 Revenue as at end of June (largely billed income rather than cash (received) was R1 693 140 million. This represents 100% of the total Approved Budget for the year or 100% of the pro rata budget.
23
3.4.2 Interest earned on external investment. Normally this represent a small amount of
interest income which is generated from the short term investments held when there are temporary surpluses of cash.
3.4.3 Interest earned on outstanding debtors. This is interest levied for main tariffs
on outstanding debt. 3.4.4 Vehicle Registration.
Vehicle registration is an in and out vote. As the money is being collected, a subsequent payment is made to the Gauteng Provincial Government.
3.5 OVERALL PERFORMANCE ON THE OPERATING BUDGET
Table 8: Operating Budget Performance for the year to 30th June 2013
2012/2013 FULL
YEAR
R 000
PRO RATA
BUDGET FOR THE YEAR TO
DATE
R 000
Expenditure Budget (2 012 524) (2 012 524)
Actual to date (1 809 342) (1 809 342)
Variance - under / over spending (203 182) (203 182)
% of Budget Spent 90% 90%
Revenue Budget 1 700 259 1 700 259
Actual income to date 1 693 140 1 693 140
Variance – under (over) revenue (7 120) (7 120)
% of Budget received 100% 100%
Surplus/(Deficit) Budgeted Position (312 264) 196 063
Surplus/(Deficit) position to date (109 082) (109 082)
Note: Negative (Expenditure) & Positive Revenue Exclude capital grants revenue
To summarise, expenditure to date is 90% of the total Approved Budget for the year or 90% of the pro rata budget.
Income to date represents 100% of the total Approved Budget for the year or
100% of the pro rata budget.
24
4 CAPITAL BUDGET PERFORMANCE 4.1 CAPITAL EXPENDITURE BY VOTE Table 9: Capital expenditure for the year to 30th June 2013 – by vote
Departments/Votes
2012/2013 Approved
Adjustment Budget
R 000
Actual expenditure to date
R 000 %
Pro rata Budget to
date
R 000
Under/ Over spend
against pro rata budget
R 000
% of pro rata budget
Spent to date
POLITICAL OFFICE 175
0
0.00%
175
175
0.00%
- Office of the Executive Mayor
175
0
0.00%
175
175
0.00%
MUNICIPAL MANAGER‘S OFFICE
6,325
1,148
18%
6,325
5,177
18%
- Administration :MM 25
19
77%
25
6
77%
-Internal Audit 70
59
85%
70
11
85%
Project Management Office
10 2 19% 10 8 19%
Information Technology 6,220
1,068
17%
6,220
5,152
17%
CORPORATE SUPPORT SERVICES:
1,600
670
42%
1,600
930
42%
- Corporate Services 1,280 589 46% 1,280 691 46%
- Legal Services 100 0 0 100 100 0%
- Human Capital Support 100 68 68% 100 32 68%
- Marketing & Communication
120 13 11% 120 107 11%
FINANCIAL SERVICES:
1,532
508
33%
1,532
1,024
33%
SOCIAL SERVICES: 43,114 31,168 72% 43,114 11,946 72%
- Community Services 37 187 25,924 70% 37,187 11,263 70%
- Public Safety 5,927 5,244 88% 5,927 683 88%
ECONOMIC SERVICES: 29,693 25,157 85% 29,693 4,536 85%
- Enterprise Development 648 569 88% 648 79 88%
- Development & planning 349 41 12% 349 307 12%
- Rural Development 28,647 24,547 86% 28,647 4,100 86%
- Sustainable Human Settlement
50 0 0% 50 50 0%
INTEGRATED ENVIRONMENTAL SERVICES:
31,142
18,781
60%
31,142
12,362
60%
- Administration 190 2 1% 190 188 1%
- Parks and Cemeteries 22,806 18,036 79% 22,806 4,770 79%
- Municipal Health 8,146 743 9% 8,146 7,404 9%
INFRASTRUCTURE SERVICES: 244,930 232,178 95% 244,930 12,751 95%
- Building Facilities 9,300 6,340 68% 9,300 2,960 68%
- Water and Sanitation 88,435 81,487 92% 88,435 6,947 92%
- Electricity 95,619 95,445 100% 95,619 174 100%
- Roads & Storm water 51,576 48,906 95% 51,576 2,670 95%
TOTAL CAPITAL BUDGET
358,511
309,611
86%
358,511
48,900
86%
4.1.1 Table 9 above shows expenditure as at end of June 2013 on the capital budget per vote. In overall terms 86% of the capital budget has been spent.
25
4.2 CAPITAL EXPENDITURE BY PROJECT 4.2.1 Annexure B, Table 1 gives details of expenditure incurred to date on each capital
project. 4.3 FUNDING OF THE CAPITAL BUDGET Table 10: Funding of capital expenditure for the year to 30th June 2013
Source of Funding
2012/2013
Approved Adjustment Budget
R 000
Financing of capital
expenditure incurred to date
R 000
National Government Grants
- Municipal Infrastructure Grant 96 435 88 375
- DWAF 1 531 1 531
- Department of Energy 8 000 7 817
Total National Government Grants 105 966 97 723
Provincial Government Grants
- Social Development 16 669 16 669
- GDACE 362 97
- SRAC 1 891 1 824
Total Grants from Province 18 922 18 590
District Municipality grants
- WRDM 3 085 900
Total Grants from District 3 085 900
Council’s Own Funds
- Own Funds 54 097 24 593
- External Loans - 176 441 167 805
Total Own Funds 230 539 192 398
TOTAL FUNDING 358 512 309 611
26
Table 10 on page 25 is source of funding: The total expenditure on Capital for the month ending June 2013 is R 309 611m, representing 86% as compared to the total budget, 86% of the pro rata budget. National Grants: Spending on this class of funding sits at 92%, the breakdown thereof is as follows: Municipal Infrastructure Grant: 92%, Department of Water Affairs: 100% Department of Energy: 98% This grants are conditional and not spend fully will affect our share of equitable share for the first quarter of the 2013/14 financial year as MCLM will be required to pay back unspent funds to National Treasury. There is a significant improvement on the level of spending on this source of funding, as there are still invoices coming through, the 8% still unspend may be entirely spent. Provincial and District Grants: Provincial grants shows a 98% expenditure of the total budget, the social development grant is 100% spend whereas the SRAC grant is 96% spent. The only lagging grant showing low expenditure is GDACE, however this is price money grant and is not conditional. District grant is still showing a 29% expenditure, this is expenditure on the Lenwan Hostel upgrade. The portion of the grant ,is meant for the Kromdraai pipeline, this project was indeed transferred from the WRDM to MCLM for completion, at the time of transfer, the contractors were already appointed,the project is currently on hold due to concerns raised by the Cradle of Human Kind Management Authority regarding compliance, this is in relation to the Record of Decision as issued by GDARD, and MCLM could not proceed with the project without satisfying all concerned affected parties. And upon engaging all concerned parties it emerged that concerns relates to the issue of who between the GDARD and DEA has the authority to issue the ROD. These concerns meant that MCLM could not proceed with the project, however the WRDM has undertaken to assist in resolving the matter, and once this has been settled, MCLM can finish the project in a space of two months. Own Funded: Spending to date on own funded projects (own revenue combined with borrowed own funding) are 83% or R 192 398 million, Nedbank loan indicates 95% spending, a marked improvement as compared to 66% recorded in May, while own revenue is still lagging behind with 45% recorded to date.
27
At a recent meeting a survey was undertaken to determine why departments are not spending their allocated funds on capital, most of them indicated that they are either at the tender allocation process and for small projects are at the supply chain for quotations to be evaluated. The expenditure on capital for the month ending June indicates that departments roll out their projects right at the end of the financial year, this practice will have to discouraged and as it puts a strain on the own funded cash flow. What we have noticed is that majority of the departments start with the supply chain process very late or 3 months before year end which is a clear indication of lack of planning and foresight. We believe that in the following years to come this lessons will assist us in coming up with a planning module that will enable us to plan better. Infrastructure, which has 68% of the total budget allocated to, currently shows 95% of expenditure on all their projects. Current Status on Capital Budget Spending At the time of going to the print with this report total expenditure on capital was standing at R 314 928 or 88%, a 2% increase on the reported 86%. MIG was R 93,143, translating into 97% of the budget. External Loan funding was standing at R 168,339 or 96% of the budget. All other grants were still standing as reported above – it should be noted that this expenditure amounts will probably change as will be seen in the final Annual Financial Statements as invoices are still coming in.
28
4.4 GRANTS – ALLOCATIONS RECEIVED AND EXPENDITURE INCURRED 4.4.1 Section 71 of the MFMA requires that the amount of grant allocations received by
the municipality, and the amount of expenditure funded by these allocations, be reported monthly (including equitable share). Annexure A, Table SC6 (receipts) and SC7 (expenditure) gives this information.
4.4.2 Table SC6 show that MCLM expects to obtain R340 928million of grants from
other spheres of government for 2012/2013 to date an amount of R340 928 have been received. This amount is for funding both the operational and capital budget.
Supporting Table SC6 Monthly Budget Statement - transfers and grant receipts - M12 June
Description
2011/12 Budget Year 2012/13
Audited Outcome
Original Budget
Adjusted Budget
Monthly actual
YearTD actual
YearTD budget
overs/unders against ytd
budget
YTD actual as a %
pro rata
budget
R thousands %
RECEIPTS:
Operating Transfers and Grants
National Government:
191,493
219,068
216,223 –
216,223
216,223 – 100.0%
Local Government Equitable Share
186,224
210,117
210,117
210,117
210,117 – 100.0%
Finance Management
1,250
1,250
1,250 –
1,250
1,250 – 100.0%
Municipal Systems Improvement 800
1,000
1,000 –
1,000
1,000 – 100.0%
EPWP Incentive
1,155
1,891
2,085 –
2,085
2,085 – 100.0%
MIG (PMU)
2,064
4,810
1,771 –
1,771
1,771 – 100.0%
Provincial Government:
4,770
4,770
4,322 –
4,322
4,322 – 100.0%
Sport and Recreation
4,770
4,770
4,322
4,322
4,322 – 100.0%
Housing – – – 0.0%
Total Operating Transfers and Grants
196,263
223,838
220,545 –
220,545
220,545 – 100.0%
Capital Transfers and Grants
National Government: –
102,096
104,435 –
104,435
104,435 – 100.0%
Municipal Infrastructure Grant (MIG)
93,396
96,435
96,435
96,435 – 100.0%
National Electrification Programme
8,000
8,000
8,000
8,000 – 100.0%
Provincial Government: –
15,500
15,948 –
15,948
15,948 – 100.0%
Sports & Recreation 448 448 448 – 100.0%
Social Development
15,500
15,500
15,500
15,500 – 100.0%
Total Capital Transfers and Grants –
117,596
120,383 –
120,383
120,383 – 100.0%
TOTAL RECEIPTS OF TRANSFERS & GRANTS
196,263
341,434
340,928 –
340,928
340,928 – 100.0%
29
Supporting Table SC7 Monthly Budget Statement - transfers and grant expenditure - M12 June
Description
2011/12 Budget Year 2012/13
Audited Outcome
Original Budget
Adjusted Budget
Monthly actual
YearTD actual
YearTD budget
overs/unders against ytd
budget
YTD actual as a %
pro rata
budget
R thousands %
EXPENDITURE
Operating expenditure of Transfers and Grants
National Government:
190,724
219,068
216,223
13,879
216,137
216,223 86 100.0%
Local Government Equitable Share
186,224
210,117
210,117
13,138
210,117
210,117 – 100.0%
Finance Management
1,250
1,250 1,250
206
1,250
1,250 (0) 100.0%
Municipal Systems Improvement
800
1,000 1,000
1,000
1,000 – 100.0%
EPWP Incentive
386
1,891 2,085
419
2,132
2,085 (47) 102.3%
MIG (PMU)
2,064
4,810 1,771
117
1,638
1,771 133 92.5%
Provincial Government:
1,495
4,770 4,322
323
3,714
4,322 608 85.9%
Sport and Recreation
1,495
4,770 4,322
323
3,714
4,322 608 85.9%
Housing – – 0.0%
Total operating expenditure of Transfers and Grants:
192,220
223,838
220,545
14,203
219,851
220,545 694 99.7%
Capital expenditure of Transfers and Grants –
National Government:
73,001
102,096
104,435
25,627
96,190
104,435 8,246 92.1%
Municipal Infrastructure Grant (MIG)
73,001
93,396 96,435
18,830
88,373
96,435 8,062 91.6%
Neighbourhood Development Partnership
700 – –
National Electrification Programme
8,000 8,000
6,797
7,817
8,000 183 97.7%
Provincial Government:
20,813
15,500 15,948
1,682
17,324
15,948 (1,376) 108.6%
Sports & Recreation
3,653 448
1,682
1,824
448 (1,376) 407.4%
Social Development
17,160
15,500 15,500
15,500
15,500 – 100.0%
Total capital expenditure of Transfers and Grants
93,814
117,596
120,383
27,309
113,514
120,383 6,869 94.3%
TOTAL EXPENDITURE OF TRANSFERS AND GRANTS
286,034
341,434
340,928
41,512
333,365
340,928 7,563 97.8%
4.4.3 A point worth noting is that excluded from the SC6(grants received) is a total rollover amount of R 5 160m as it was not gazetted for the 2012/13 budget year, and also excluded in SC7(grants expenditure) is an amount of R 1 869m relating to rollover expenditure. To date R333 365 has been spend which comes to 98% of total budget and 98% of pro rata budget.
30
5. CASH FLOW POSITION
5.1 The cash flow position for the 2012/13 year is given in the Table C7 cash Flow.
2011/12 Budget Year 2012/13
Audited
Outcome
Original
Budget
Adjusted
Budget
Monthly
actual
YearTD
actual
YearTD
budget
YTD
variance
YTD
variance
Full Year
Forecast
R thousands 1 %
CASH FLOW FROM OPERATING ACTIVITIES
Receipts
Ratepay ers and other 1,389,307 1,734,186 1,686,478 120,034 1,545,671 1,686,478 (140,807) -8% 1,686,478
Gov ernment - operating 198,644 227,133 228,316 – 222,519 228,316 (5,798) -3% 228,316
Gov ernment - capital 103,357 119,871 127,976 – 121,706 127,976 (6,270) -5% 127,976
Interest 18,392 619 974 – 3,013 974 2,039 209% 974
Div idends 13 – – – – – – –
Payments
Suppliers and employ ees (1,254,199) (1,813,506) (1,794,429) (145,586) (1,690,378) (1,794,429) (104,051) 6% (1,794,429)
Finance charges (71,764) (44,417) (31,057) (1,648) (29,637) (31,057) (1,420) 5% (31,057)
Transfers and Grants (19,895) (20,859) (31,083) – (12,681) (31,083) (18,402) 59% (31,083)
NET CASH FROM/(USED) OPERATING ACTIVITIES 363,855 203,027 187,175 (27,200) 160,212 187,175 (26,962) -14% 187,175
CASH FLOWS FROM INVESTING ACTIVITIES
Receipts
Proceeds on disposal of PPE 28,121 6,900 150 – – 150 (150) -100% 150
Decrease (Increase) in non-current debtors – – – – – – – –
Decrease (increase) other non-current receiv ables – – – – – – – –
Decrease (increase) in non-current inv estments (9,064) – – – – – – –
Payments
Capital assets (368,826) (382,974) (358,512) (59,940) (285,185) (358,512) (73,326) 20% (358,512)
NET CASH FROM/(USED) INVESTING ACTIVITIES (349,769) (376,074) (358,362) (59,940) (285,185) (358,362) (73,176) 20% (358,362)
CASH FLOWS FROM FINANCING ACTIVITIES
Receipts
Short term loans – – – – – – – –
Borrow ing long term/refinancing – 190,994 190,994 41,590 190,994 190,994 – 190,994
Increase (decrease) in consumer deposits 958 – – – – – – –
Payments
Repay ment of borrow ing (10,605) (14,691) (19,304) (1,931) (20,546) (19,304) 1,242 -6% (19,304)
NET CASH FROM/(USED) FINANCING ACTIVITIES (9,647) 176,303 171,690 39,658 170,448 171,690 1,242 1% 171,690
NET INCREASE/ (DECREASE) IN CASH HELD 4,439 3,256 504 (47,482) 45,475 504 504
Cash/cash equiv alents at beginning: 39,336 22,073 22,073 22,073 22,073 22,073
Cash/cash equiv alents at month/y ear end: 43,775 25,329 22,577 67,549 22,577 22,577
Description Ref
GT481 Mogale City - Table C7 Monthly Budget Statement - Cash Flow - M12 June
31
GT481 Mogale City - Supporting Table SC9 Monthly Budget Statement - actuals and revised targets for cash receipts - M12 June
July August Sept October Nov Dec January Feb March April May June
R thousands 1 Outcome Outcome Outcome Outcome Outcome Outcome Budget Budget Budget Budget Budget Budget
Cash Receipts By Source
Property rates 23,880 28,783 22,696 23,994 27,902 27,767 23,065 21,555 24,943 27,700 28,368 21,197 252,696 302,826 333,108
Property rates - penalties & collection charges – – – – – – – – – – – – – – –
Serv ice charges - electricity rev enue 45,166 56,601 59,811 66,809 59,772 49,805 54,707 46,231 47,071 52,765 54,523 54,988 706,021 836,002 948,862
Serv ice charges - w ater rev enue 10,961 13,920 12,424 12,821 14,326 15,686 10,782 12,481 11,426 13,787 12,786 14,029 180,554 204,088 226,599
Serv ice charges - sanitation rev enue 7,177 6,965 5,928 6,489 6,639 6,719 6,330 6,174 6,077 7,307 6,837 6,126 94,519 108,886 119,775
Serv ice charges - refuse 4,211 4,583 4,311 4,434 4,859 4,754 4,528 4,131 4,258 4,645 5,025 4,669 68,179 77,114 84,826
Serv ice charges - other 1,164 2,218 1,252 1,025 1,472 896 1,474 1,511 1,312 1,626 1,880 1,825 32,605 26,001 28,601
Rental of facilities and equipment 35 476 265 260 274 – – 682 209 – 431 186 2,990 4,200 4,620
Interest earned - ex ternal inv estments – – 56 – – – – 6 2,404 274 274 – 974 631 644
Interest earned - outstanding debtors 436 700 697 731 – – 783 6 2,045 1,040 1,064 2,823 8,550 18,434 20,278
Div idends receiv ed – – – – – – – – – – – – – – –
Fines 341 254 351 199 658 69 – 766 2,473 312 1,032 3,023 6,777 16,923 16,923
Licences and permits 7,955 – – – – – – – 582 – – 65,004 65,016 65,019
Agency serv ices – 1,867 1,792 – – – – – 2,342 1,682 3,824 7,955 19,075 17,266 17,266
Transfer receipts - operating 88,956 6,157 1,134 990 70,386 – – 493 52,552 1,851 – – 228,316 239,369 256,805
Other rev enue 14,507 36,692 5,410 28,289 26,092 16,415 51,845 16,914 11,055 10,277 17,981 3,214 249,507 328,000 250,487
Cash Receipts by Source 204,789 159,217 116,127 146,040 212,381 122,111 153,513 110,952 168,749 123,266 134,024 120,034 1,915,768 2,244,757 2,373,814 –
Other Cash Flows by Source –
Transfer receipts - capital 49,051 – 15,500 3,000 – 29,235 – – 24,920 – – – 127,976 108,416 121,763
Contributions & Contributed assets – – – – – – – – – – – – – –
Proceeds on disposal of PPE – – – – – – – – – – – – 150 – –
Short term loans – – – – – – – – – – – – – – –
Borrow ing long term/refinancing – – – – – 83,865 – – 65,539 41,590 190,994 – –
Increase in consumer deposits – – – – – – – – – – – – –
Receipt of non-current debtors – – – – – – – – – – – – –
Receipt of non-current receiv ables – – – – – – – – – – – – –
Change in non-current inv estments – – – – – – – – – – – – – – –
Total Cash Receipts by Source 253,840 159,217 131,627 149,040 212,381 235,211 153,513 110,952 259,208 123,266 134,024 161,624 2,234,888 2,353,174 2,495,576 –
Cash Payments by Type –
Employ ee related costs 34,510 36,646 34,796 35,442 41,018 32,998 36,732 36,113 36,489 36,690 38,385 37,870 466,425 502,551 542,755
Remuneration of councillors 1,493 1,493 1,476 1,476 1,459 1,465 1,562 1,411 1,562 1,611 1,432 2,529 21,930 24,342 26,776
Interest paid 1,228 1,598 – 7,593 1,510 676 1,516 1,985 577 8,716 2,546 1,019 31,057 50,784 50,491
Bulk purchases - Electricity 85,512 41,228 38,131 33,883 36,866 65,510 41,669 2,632 55,165 11,662 16,927 33,326 470,623 541,282 627,888
Bulk purchases - Water & Sew er 750 10,764 13,315 15,586 12,022 26,568 12,500 984 24,639 1,034 12,529 29,668 162,837 175,059 198,692
Other materials 6,565 4,109 4,173 4,109 5,935 7,037 5,897 4,491 10,328 9,735 10,284 10,085 89,416 103,525 113,877
Contracted serv ices 25,210 14,936 12,164 16,900 21,845 23,837 20,143 9,974 26,459 12,410 20,495 19,945 229,503 196,877 200,847
Grants and subsidies paid - other municipalities – – – – – – – – – – – – – – –
Grants and subsidies paid - other 1,359 2,728 – – – 1,678 – – 1,351 2,850 2,714 – 31,083 20,953 23,152
General ex penses 8,546 12,282 4,692 11,767 6,092 15,963 8,845 4,347 11,966 1,592 8,228 11,043 135,173 162,731 176,514
Cash Payments by Type 165,174 125,784 108,748 126,757 126,746 175,732 128,864 61,937 168,537 86,299 113,540 145,485 1,638,044 1,778,103 1,960,992 –
Other Cash Flows/Payments by Type
Capital assets 20,357 6,467 6,760 15,706 4,125 12,849 12,364 23,682 54,920 12,271 55,745 59,940 358,512 403,060 234,620
Repay ment of borrow ing 1,246 2,109 – 989 2,197 683 1,531 3,653 1,355 1,760 3,092 912 19,304 17,593 18,385
Other Cash Flow s/Pay ments 20,259 17,378 23,411 16,655 24,095 12,213 21,094 18,836 16,164 10,073 17,167 2,769 218,525 165,487 237,733
Total Cash Payments by Type 207,036 151,738 138,918 160,106 157,163 201,477 163,852 108,109 240,976 110,403 189,544 209,105 2,234,385 2,364,244 2,451,731 –
NET INCREASE/(DECREASE) IN CASH HELD 46,804 7,479 (7,292) (11,066) 55,218 33,735 (10,339) 2,843 18,233 12,863 (55,521) (47,482) 504 (11,070) 43,845
Cash/cash equiv alents at the month/y ear beginning: 22,073 68,877 76,356 69,064 57,998 113,216 146,951 136,612 139,455 157,688 170,551 115,030 22,073 22,577 11,507
Cash/cash equiv alents at the month/y ear end: 68,877 76,356 69,064 57,998 113,216 146,951 136,612 139,455 157,688 170,551 115,030 67,549 22,577 11,507 55,352
Budget Year
+1 2013/14
Budget Year
+2 2014/15
Description
Budget Year
2012/13
RefBudget Year 2012/13
2012/13 Medium Term Revenue &
Expenditure Framework
32
5.2. A summary of the cash flow for the year is reflected in SC9. SC9 reflects the decrease in the cash and investments position more clearly. A decrease in cash of R47,482m is shown for the month of June 2013.
5.3 As at 30th June 2013 MCLM's bank balance amounted to R31,715,179.81 5.4 The total cash received during the month of June 2013 amounted to R2,441,841m
which is R115,930m more than the expected amount of R2,557,771m. Total Actual expenditure for the same period amounted to R2,460,441m which is R162,604more than the budgeted expenditure of R2,615,238m.
5.5 The total cash received includes cash received for Operating Activities such as the
sale of water, electricity, fees charged for refuse removal and sanitation as well as other service charges.
5.6 The total cash received from Operating Activities was R1,531,182m from the
expected Adjusted budget at 94% collection rate of R1,647,112m. Council therefore received R115,930m less operational income than expected.
5.7 The Total Income was made up of the following: Figures in Rm’s
Revenue Source Expected Income Actual Income Difference
RM RM RM
Property Rates R 252,696 R 301,850 R 49,154
Electricity R 670,467 R 604,875 R- 65,592
Water R 164,725 R 140,561 R -24,164
Sanitation R 94,519 R 78,809 R -15,710
Refuse R 68,179 R 54,409 R -13,770
PP Electricity R 35,554 R 43,375 R 7, 821
PP Water R 15,566 R 14,979 R -577
Other Income R 352,879 R 292,324 R -60,555
Sub-Total R 1,654,585 R 1,531,182 R 115,930
Investments Redeemed R 375,133 R 375,133 R 0
Operating Grants R 222,826 R 222,826 R 0
External Loan Received R 190,994 R 190,994 R 0
Capital Grants R 121,706 R 121,706 R 0
Total Income R 2,557,771 R 2,441,841 R 115,930
5.8 Other Service Charges, amounting to R17,655m consist of income for connection
and re-connection fees, building plan fees, cemetery fees and landfill site fees. 5.9 During the month of June 2013 the operating expenditure payments amounted to
R1,737,163 m, which is R119,153 less than the expected R1,856,316m .
33
5.10 Total Expenditure was made up of the following: Figures in Rm’s
Expenditure Item Expected Expenditure Actual Expenditure Difference
RM RM RM
Salaries R 488,355 R 461,126 R 27,229
Electricity R 470,623 R 462,510 R 8,113
Water R 159,821 R 157,149 R 2,672
Sewer R 3,016 R 3,210 R -194
Other Creditors R 734,501 R 653,168 R 81,333
Sub-Total R 1,856,316 R 1,737,163 R 119,153
Investments made R 380,853 R 380,853 R 0
Financing Activities R 46,557 R 46,557 R 0
Operating Grants R 10,683 R 10,683 R 0
Capital Expenditure R 328,636 R 285,185 R 43,451
Total Expenditure R 2,615,238 R 2,460,441 R 162,604
Annexure B, Table 2 displays the capital expenditure to date.
`
5.11 Council did not receive MIG funds during the month of June 2013.
34
6. CURRENT BANK BALANCE, INVESTMENTS, AND BORROWING 6.1 BALANCE IN CURRENT ACCOUNTS Table 11: Balance in current account as at 30th June 2013.
STANDARD BANK
TOTAL AVAILABLE
Balance
R31,715,180 R 31,715,180
6.2 INVESTMENTS 6.2.1. Schedule SC5 gives the Investment portfolio as at 30th June 2013. 6.2.2 MCLM has investments totaling R103,958m. Of this amount, R69,079m are
investments that are linked to the bullet loans previously taken out by the municipality. These investments must be used to repay the bullet loans at the end of the loan period or when a consolidation or restructuring of the loans is undertaken.
6.3 LOANS 6.3.1 MCLM has long term loans outstanding of R366,643m.A Increase amounting to
R42,546 million was due the final draw down amounting R41,590 million during the month.
6.4 QUARTELY WITHDRAWAL STATEMENT 6.4.1 Section 11(4) of the MFMA requires that a consolidated report is tabled to Council
at least quarterly on all withdrawals made from the municipality's bank accounts in terms of section 11(1) (b) to (j) of that Act. Annexure B Table 8 gives this information in the prescribed format.
35
6.4 SHORT TERM BORROWING 6.4.1 Section 45 (3) (iii) of the MFMA requires the accounting officer to notify the Council
in writing as soon as practical of the amount, duration and cost of any short term loan (overdraft facility) incurred by the municipality.
Mogale City utilised the overdraft facility during the month of June 2013.On average Mogale utilised an overdraft amounting to R16,537,007. Below is the schedule of days that Mogale utilised the overdraft.
Date Amount
3-Jun-13 -6,545,330
4-Jun-13 -8,407,713
5-Jun-13 -12,214,245
6-Jun-13 -8,831,024
7-Jun-13 -20,361,945
10-Jun-13 -17,714,974
11-Jun-13 -13,805,951
12-Jun-13 -10,462,710
13-Jun-13 -14,915,264
14-Jun-13 -16,448,597
18-Jun-13 -14,049,217
19-Jun-13 -14,715,678
20-Jun-13 -18,971,935
21-Jun-13 -23,206,922
24-Jun-13 -21,130,889
25-Jun-13 -33,244,535
26-Jun-13 -26,102,199
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7. PERFORMANCE ON MAIN TARIFF REVENUE COLLECTION
7.1. Collection rates as at 30 June 2013 The following is a summary of the year to date collection rate as at June 2013 Table 12: Collection rates to 30 JUNE 2013
Main Tariff
Amount Billed
For the year to date
Amount received for the year to date
Collection Rate (received/billed) For the year to
date %
Property Rates 262 768 286 301 849 988 115% Electricity services 658 908 976 604 875 297 92% Water services 172 092 881 140 560 867 82% Sanitation services 92 641 451 78 809 016 85% Refuse services 72 871 087 54 408 731 75% SUB TOTAL 1 259 282 681 1 180 503 898 94% Other income 32 967 663 17 654 899 54% TOTAL 1 292 250 343 1 198 158 796 93%
7.1.1 The above table shows the amount billed and the amount of cash received for
each of the main tariffs. This is also shown graphically in Chart 1. 7.1.2 Other income related to debtors has been added to this monthly report. The totals
for the five main tariffs are thus stated separately as sub-totals.
37
Chart 1: Collection Rates to 30 June 2013 - by tariff
0
20
40
60
80
100
120
140
Property tax Electricity Water Sewage Refuse
%
%
Table 13: Collection Rate to 30 June 2013 by Suburb (accumulated year to date)
Suburb
Amount Billed For the year to
date
R
Amount received For the year to
date
R
Collection Rate (received/billed) For the year to
date %
Krugersdorp 950 724 879 934 016 459 98% Kagiso 80 640 103 44 612 840 55% Munsieville 12 916 004 7 661 344 59% Azaadville 38 363 780 35 519 433 93% Lusaka 17 021 355 7 165 140 42% Magaliesburg 30 804 127 23 503 239 76% A/H 19 751 637 18 258 190 92% Farms 124 050 150 113 806 226 92% Other 17 978 309 13 615 925 76% TOTAL 1 292 250 343 1 198 158 796 93%
7.1.3. The tables and charts below show monthly Collection Rates analysed by suburb and by customer category.
38
Chart 2: Collection Rates for the year to 30 June 2013 – by Suburb
Table 14: Collection Rate to 30th June 2013 by Customer (Ytd)
Customer Group
Amount Billed For the year to date
R
Amount received For the year to date
R
Collection Rate (received/billed) For the year to
date %
Domestic 703 797 763 634 791 468 90%
Business 250 792 110 235 760 741 94%
Industrial 261 930 393 254 569 498 97%
Government 52 669 601 51 726 506 98%
School 16 005 011 15 385 510 96%
Church 7 055 466 5 925 073 84%
TOTAL 1 292 250 343 1 198 158 796 93%
39
Chart 3: Collection Rates for the year to 30 June 2013 – by customer (YTD)
7.2. COLLECTION RATE PERFORMANCE Table 15: Collection Rate comparative figures from 2007/08 onwards
2007/08 2008/09 2009/10
2010/11
2011/12
2012/13
Collection Rate for the months of June
97% 72% 100% 86% 97% 89%
Average Collection Rate for year to date
93% 88% 90% 93% 96% 94%
7.2.1 The Collection Rate for the period June 2013 is low in comparison to the previous
year. Year-to-date is lower than the previous year as shown in the table above.
40
7.3 OUTSTANDING DEBTORS (AMOUNTS OWED TO MCLM)
Chart 4: Total Outstanding Debtors as at 30 June 2013
7.3.1 The current debt outstanding and owed to the municipality is R922.9 million. Of this
82% is older than 30 days, as shown in chart 4 above. The detailed age analysis for total debtors is shown below in chart 5.
.
41
Chart 5: Age analysis of total outstanding debtors as at 30 June 2013
7.4 AGE ANALYSIS
Month Balance Current 30 days 60 days 90 Days 120 plus
July 882 584 253 121 923 836 109 073 151 27 388 245 23 065 348 601 133 673
August 894 892 555 223 717 801 26 437 284 69 585 504 11 862 575 563 289 390
September 907 226 415 122 122 711 85 331 748 25 920 972 63 241 424 610 609 561
October 888 089 327 217 195 230 36 384 159 21 778 876 13 369 112 599 361 950
November 892 921 276 224 903 586 32 819 673 22 507 550 17 053 001 595 637 465
December 891 770 519 204 799 281 47 121 812 17 634 383 18 337 920 603 877 124
January 896 199 187 208 490 323 42 801 549 21 922 552 14 383 620 608 601 143
February 905 949 373 228 443 022 40 990 410 19 025 317 21 145 979 596 344 645
March 919 904 350 228 853 334 42 731 877 19 981 617 32 656 550 595 680 971
April 910 733 299 238 523 129 40 742 046 22 907 669 15 412 478 593 147 976
May 909 608 571 244 606 376 33 185 535 22 695 720 19 030 605 590 090 335
June 922 973 788 276 743 029 19 027 579 18 803 369 16 690 681 536 270 148
42
CHART 6 AGE ANALYSIS YEAR TO DATE
-
100 000 000
200 000 000
300 000 000
400 000 000
500 000 000
600 000 000
700 000 000
800 000 000
900 000 000
1 000 000 000
Balance Current 30 days 60 days 90 Days 120 plus
July
August
September
October
November
December
January
February
March
April
May
June
7.5 MONTHLY INCOME VARIANCE ON CASH COLLECTION AS AT 30 June2013
Month Budget Income Actual Billed Variance
July
118 932 104 733
-14 199
August
118 932 113 339
-5 593
September
118 932 120 702 1 770
October
118 932 112 222 -6 710
November
118 932 98 676 -20 256
December
118 932 108 669 -10 263
January
118 932 98 684 -20 248
February
96 832 100 718 3 886
March
96 832 97 092 260
April
96 832 95 449 -1 383
May
96 832 103 597 6 765
June 96 832 105 400 8 568
43
7 .6 MONTHLY PAYMENT COLLECTION RATES AS AT 30 June 2013
Month Actual Billed Actual Income Payment Level
July
104 733 89 352 85%
August
113 339 105 711 93%
September
120 702 99 501 82%
October
112 222 109 373 97%
November
98 676 108 772 110%
December
108 669 101 927 94%
January
98 684 94 877 96%
February
100 718 85 053 84%
March
97 092 90 381 93%
April
95 449 99 941 105%
May
103 597 102 309 99%
June 105 400 93 307 89%
44
Chart 7 Monthly payment collection rates
45
7.8. PERFORMANCE OF DEBT COLECTORS
Table 19 Performance of debt collectors
COLLECTOR AMOUNT H/O COLLECTEDCORRECTIONS/
INDIGENTSDATE
NEW
OUTSTANDING
AFTER H/O
REVCO 161 514 716 12 578 124 46 857 692 2013-06-30 102 078 900
CREDITWORX 155 630 763 10 729 389 58 389 440 2013-06-30 86 511 933
MOODIE & ROBERTS 172 145 664 13 299 246 60 614 271 2013-06-30 98 232 147
REVCO 170 893 353 18 112 254 66 044 027 2013-06-30 86 737 072
CREDITWORX 204 827 095 25 973 386 65 965 378 2013-06-30 112 888 331
Truter, Crous & Wiggill 369 916 1 330 210 051 2013-06-30 158 534
Sundry Moodie & Roberts 37 685 448 28 204 28 449 534 2013-06-30 9 207 711
Total 903 066 955 80 721 934 326 530 393 495 814 628 The above table indicates the performance of debt collectors to date. Approximately 14% of the debt has been collected to date
46
8. RECOMMENDATIONS
1. That the Fourth Quarter In-Year Monitoring Report for the period 30th June 2013 be adopted.