2018ANNUALREPORTB O L A N D T V E TC O L L E G E

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Message from the Council ChairpersonThe Accounting Officer’s ForewordStatement of Responsibility and Confirmation of AccuracyLegislation and Other Directives- Legislative Framework- Legislative and Other Mandates

GENERAL OVERVIEWA

G O V E R N A N C E

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Report of the Council ChairpersonConstitution of the College Council and Governance Structures The Report of Council on Risk Assessment and Management of RisksReports by Committees of the CouncilAcademic Board ReportStudent Representative Council Report

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Report by the Principal on Management and Administration High-level Organisational StructureStaff EstablishmentCollege Performance andOrganisational EnvironmentPerformance ReportingAchievement of Strategic ObjectivesCollege Achievement in terms of Strategic System TargetsStrategy to Deal with Underperformance

P E R F O R M A N C E I N F O R M A T I O NC

3713 Financial Statements

F I N A N C I A L I N F O R M A T I O ND

03Abbreviations and acronyms1

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AET Adult Education and TrainingAG Auditor-GeneralAPP Annual Performance Plan BATI Boland Automotive Training InitiativeCBMT Competency-Based Modular TrainingCET Continuing Education and TrainingCET Act Continuing Education and Training ActCEO Chief Executive OfficerCDW Community Development WorkersCFO Chief Financial OfficerCHEC Cape Higher Education ConsortiumCOS Centre of SpecialisationCS Corporate ServicesDEDAT Department of Economic Development and TourismDHET Department of Higher Education and Training DP Deputy PrincipalE&A Examination and AssessmentETQA Education and Training Quality AssuranceGETC General Education and Training CertificateGRAP Generally Recognised Accounting PracticeHE Higher EducationHR Human ResourcesHRDS-SA Human Resource Development Strategy for South AfricaIEC Independent Electoral CommissionICT Information Communication TechnologyICASS Internal Continuous AssessmentIDP Integrated Development PlansM&E Monitoring and EvaluationMIS Management Information SystemMOA Memorandum of AgreementMOU Memorandum of UnderstandingMTEF Medium Term Expenditure Framework MTSF Medium Term Strategic Framework NAPTOSA National Professional Teachers’ Organisation of South AfricaNC(V) National Certificate (Vocational) qualification at NQF Levels 2 – 4NDP National Development Plan NEET Not in employment nor in education and training (youth) NEHAWU National Education Health and Allied Workers UnionNGO Non-government organisationNPO Non-profit organisation

01A B B R E V I A T I O N SA N D A C R O N Y M S

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NQF National Qualifications FrameworkNSDS National Skills Development Strategy NSF National Skills FundNSFAS National Student Financial Aid SchemeOPS Plan Operational Plan OLC Open Learning CentrePICC Presidential Infrastructure Coordinating CommissionPLANCO Planning and Resources CommitteePQM Programme Qualification Mix PSA Public Service Association of South AfricaPSET Post-School Education and TrainingQCTO Quality Council for Trades and OccupationsQMS Quality Management SystemSABS South African Bureau of StandardsSADTU South African Democratic Teachers Union SAQA South African Qualifications AuthoritySETA Sector Education and Training Authority SNE Special Needs Education SO Strategic ObjectiveSP Strategic PlanSSP Sector Skills Plan SRC Student Representative CouncilSWOT Strengths, Weaknesses, Opportunities, Threats TVET Technical and Vocational Education and Training UMALUSI Council for Quality Assurance in General and Further Education and TrainingVP Vice-PrincipalWCED Western Cape Education DepartmentWIL Work Integrated Learning WPBL Workplace-based Learning

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The overall experience of 2018 was a positive one for Boland College. It was a time of consolidation and recovery following the financial stresses of the previous two years.

Council welcomed the appointment of Mrs Johanna Coetzee as Principal with effect from 1 August 2018. Mrs Coetzee has served the College with distinction for many years, most recently as Vice-Principal: Corporate Services. The contribution of Chief Financial Officer Mr Hannes Gelderblom, who acted as Principal for more than a year, is gratefully acknowledged.

A major risk to the sustainability of the College was alleviated in the course of the year, with a significant improvement in the disbursement of funds from the National Student Financial Aid Scheme (NSFAS). This has resulted in a more comfortable cash flow situation for the College. Boland College contributed to the turnaround at NSFAS by making its IT Manager available to assist NSFAS in a clean-up of data for all of the 50 TVET Colleges.

At the same time, the Department of Higher Education and Training (DHET) has made substantial funding available for infrastructure development in the TVET College sector over a three-year period. An amount of R9,1 million was made available to Boland College in 2018 for urgent maintenance. Council is grateful to the DHET for this support.

Risks to the College received particular attention during the year, with a Strategic Risk Management Workshop in August at which the College’s risk management procedures were reviewed.

G E N E R A LO V E R V I E W

A02M E S S A G E F R O M T H EC O U N C I L C H A I R P E R S O N

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Threats to the viability of Boland College were considered, as well as opportunities for growing third-stream income.

The development of the College’s Centre of Specialisation (COS) in Welding, on the Worcester campus, continued during the year.

Quality remains at the heart of everything that Boland College undertakes and an audit of its Quality Management System (QMS) against the ISO 9001:2015 standard was successfully conducted.

The academic results for 2018 were once again of a high standard. Council congratulates both students and staff on the outcome of their efforts.

The term of the current Council of Boland College expires in March 2019. As outgoing chairman, I pay tribute to all the Council members – external members, College staff members, and student representatives – for their dedication to the welfare of Boland College and the students it serves. It has been a privilege to serve on the College Council and I wish the incoming Council all the best in guiding the future trajectory of the College.

DAVID BLEAZARD // Council Chairperson

12 March 2019

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During 2018 the College once again had the opportunity to engage in opportunities as well as dealing with challenges. Boland College would like to acknowledge the support of the DHET, both at regional and national level, SETAs, employers and other stakeholders throughout 2018. Without their support, it would have been difficult to achieve our goals.

Our vision to grow and expand access to Artisan Development received a boost with the establishment of a Centre of Specialisation (COS) for Welding at the Worcester campus. The main aim of the COS is to deliver more efficiently and effectively on 30 well qualified welding artisans for Year 1, followed by two more years. The facility was prepared during 2018, facilitators were appointed and candidates recruited. All systems are set to run with the programme in 2019. Boland College is grateful for the employers that support the initiative by allowing their employees to enrol in the artisan programme. We believe that the final outcome of the process will make a significant difference in addressing the shortage of skilled welders.

Boland College continued to provide academic support programmes for all students, which included mentoring and tutoring processes, focusing on fundamental subjects. The investment in academic support resulted in the College proudly being awarded the second place

(out of 50 public colleges nationally) for our November 2018 examination results for the National Certificate (Vocational) programmes.

Our Job Readiness programme and Work Placement initiatives were equally successful. Boland College salutes the workplaces and employers that have agreed to host our exiting students that needed the workplace exposure. It provided the opportunity for students to match theory and practice and it also enabled Report 191 students to apply for a National Diploma once they had complied with all the practical requirements.

03T H E A C C O U N T I N GO F F I C E R ’ S F O R E W O R D

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Boland College maintained sound relationships with SETAs such as inter alia Merseta, Chieta, EW Seta and CETA for the funding of artisan development. Manyother SETAs contributed funding to occupational projects of Boland College and also assisted the College with funding for placement of students.

The College Council was fully functional and ensured good governance of Boland College. The College was fortunate to have sound and effective structures for its governance and management. Council members brought their fields of expertise to the boardroom and greatly contributed to the successes of the College. The College acknowledges their dedication, time and effort to support the achievement of our strategic goals.

JJM COETZEE // Accounting Officer

30 May 2019

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04S T A T E M E N T O F R E S P O N S I B I L I T Y A N D C O N F I R M A T I O N O F A C C U R A C Y

All information and amounts disclosed throughout the annual report are consistent.

The annual report has been prepared in accordance with the guidelines issued by the Department of Higher Education and Training.

The annual financial statements have been prepared in accordance with the relevant standards, frameworks and guidelines issued by National Treasury.

The accounting officer, i.e. the principal, is responsible for the preparation of the annual financial statements and for the judgements made in this document.

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The accounting officer, i.e. the principal, is responsible for establishing and implementing a system of internal control that has been designed to provide reasonable assurance as to the integrity and reliability of the performance information, the human resources information and the annual financial statements.

The Auditor-General and/or external auditors express an independent opinion on the annual financial statements.

JJM COETZEE // Accounting Officer

30 May 2019

To the best of my knowledge and belief, I confirm the following:

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05L E G I S L A T I O N A N D O T H E R D I R E C T I V E S

5 . 1 . L E G I S L A T I V E F R A M E W O R K

Boland TVET College is enjoined by Section 44(3) of the Act, read in conjunction with section 25(3) of the same Act, to prepare and submit to the Minister for Higher Education and Training an annual report.

In terms of Sections 25(3) and 25(4) of the Continuing Education and Training (CET) Colleges Act, No 16 of 2006 (as amended), public technical and vocational education and training (TVET) colleges are required to produce annual financial reports and to comply with any reasonable additional reporting requirement established by the Minister. Moreover, Section 44 of the Act requires colleges to annually report to the Minister in respect of its performance and its use of available resources.

In addition, these pieces of legislation govern and steer the college in terms of achievement of its strategic and performance objectives.

5 . 2 . L E G I S L A T I V E A N D O T H E R M A N DA T E S

In terms of Sections 25(3) and 25(4) of the Continuing Education and Training (CET) Colleges Act, No 16 of 2006 (as amended), public technical and vocational education and training (TVET) colleges are required to produce annual financial reports and to comply with any reasonable additional reporting requirement established by the Minister. Moreover, Section 44 of the Act requires colleges to annually report to the Minister in respect of performance and its use of available resources. In addition, these pieces of legislation govern and steer the college in terms of achievement of its strategic and performance objectives.

Further sets of legislation that impact on the TVET colleges sector and its strategic and nationalimperatives are listed below:

> National Qualifications Framework (NQF) Act (No 67 of 2008);

> Higher Education (HE) Act (No 101 of 1997);> Skills Development Act (No 97 of 1998);> Skills Development Levies Act (No 9 of 1999); and> General and Further Education and Training

Quality Assurance Act (No 58 of 2001).

In addition, the White Paper for Post-School Education and Training mandates delivery and strategic priorities in the TVET colleges sector. Other policy mandates include:

> National Trade Testing Regulations;> SETA Grant Regulations;> National Skills Development Strategy;> Public TVET College Attendance and

Punctuality Policy; and> Policy on the Conduct of National Examinations

and Assessment.

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06R E P O R T O FT H E C O U N C I LC H A I R P E R S O N

GOVERNANCE

6 . 1 . C O N S T I T U T I O N O F T H E C O L L E G E C O U N C I L A N D G O V E R N A N C E S T R U C T U R E S

i. Names of council chairperson and members as well as their designated functions:

COLLEGE COUNCIL

// Bleazard, DK (Chairperson) // Cloete, HCA

// Coetzee, JJM (Principal as of 01 Aug. 2018)

// Dyers, O (SRC Vice-President) // Kabanyane, GC

// Lingela, S (Vice-Chairperson) // MacMaster, LLM

// Matolengwe, N // Mdludlu, M // Peters, E (VP: E&T)

// Pieterse, I (SRC President) // Pietersen, VRF

// Plaatjies, D (Educator Staff Representative)

// Vd Merwe, HA // Van Louw, CL

// Vogel, AM (Support Staff Rep) (as of 16 Apr 2018)

*Gelderblom, IJ (Acting Principal until 31 Jul 2018)

AUDIT & RISK COMMITTEE

// Cloete, HCA // Vd Merwe, HA (Chairperson)

// Burton, MV (External member) // Neal, CR (Acting

CFO until 31 Jul 2018) (Chief Risk Officer/Internal Auditor

as of 15 Oct 2018) // Coetzee, JJM (Principal as of

01 Aug 2018) // Gelderblom, IJ (Acting Principal until

31 Jul 2018) (CFO from 01 Aug 2018)

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ii. Appointments made in the year in terms of

sections 10(4) and 10(6) of the CET Act:

Ms Anna Maria Vogel was appointed on 16 April 2018

in terms of sections 10(4) and 10(6) of the CET Act.

iii. Number of meetings held and for what reason:

COLLEGE COUNCIL

28 March 2018 // 30 May 2018 // 26 September 2018

// 26 November 2018

Special meeting: 16 July 2018

Workshop: 6 August 2018

AUDIT & RISK COMMITTEE

1 March 2018 // 30 May 2018 // 28 August 2018

// 30 Oct 2018

Special meetings: 28 March 2018 // 23 July 2018

FINANCIAL COMMITTEE

1 March 2018 // 23 July 2018 // 28 August 2018

// 15 November 2018

PLANNING & RESOURCES COMMITTEE

28 February 2018 // 16 May 2018 // 5 September 2018

31 October 2018

HUMAN RESOURCES COMMITTEE

20 February 2018 // 23 May 2018 // 21 August 2018

// 17 October 2018

ACADEMIC BOARD

27 February 2018 // 8 May 2018 // 29 August 2018

// 18 October 2018

FINANCE COMMITTEE

// Bleazard, DK // Mdludlu, M // Vd Merwe, H

(Chairperson) // Coetzee, JJM (Principal as of

01 Aug 2018) // Gelderblom, IJ (Acting Principal until

31 July 2018 and CFO as of 01 Aug 2018)

// Mackriel, M // Neal, CR (Acting CFO until 31 Jul 2018)

(Senior Manager: Assets and Procurement until

14 Oct 2018) // Van Wyk, D (from 15 Oct 2018 as

Acting Manager: Assets & Procurement)

PLANNING & RESOURCE COMMITTEE

// Bleazard, DK (Chairperson) // IJ Gelderblom

(Acting Principal until 31 Jul 2018) (Acting VP: Corp Serv

01 Aug 2018 – 31 Oct 2018) // Kabanyane, GC

// Lingela, S // Plaatjies, D (Acting VP: Corp Serv as of

1 Nov 2018) // Coetzee, JJM (VP: Corp Serv until

31 Jul 2018) (Principal as of 01 Aug 2018)

// Venter, A // Maree, A

HUMAN RESOURCES COMMITTEE

// Bleazard, DK // Gelderblom, IJ (as Acting VP:

Corp Serv from 1 Aug 2018 until 31 October 2018)

// Plaatjies, D (Acting VP: Corp Serv from 1 Nov 2018)

// Saal, J // Cloete, HCA // Coetzee, JJM (VP: Corp Serv

until 31 Jul 2018) (Principal as of 01 Aug 2018)

// Matolengwe, N // Van Louw, CL (Chairperson)

// Vogel, AM

ACADEMIC BOARD

// Adams, W // Appollis, S // Baxter, R // Bongers, E

// Coetzee, JJM (Chairperson) (Principal as of

1 Aug 2018) // Cordier, C // Cronje, D // Dyers, O

(SRC Vice-President) // Hartman, I // Kabanyane, GC

// Lingela, S // MacMaster, LLM // Matthee, D

// McCombring, N // Mpati, N // October, C

// Osborne, D // Peters, E // Pieterse, I (SRC President)

// Pietersen, VRF // Plaatjies, D // Quickfall, S

// Raubenheimer, S // Sieberhagen, S // Swartz, W

// Van Rensburg, A // Van Voore, H // Walters, J

// Daniels, J (DHET by invitation)

*Gelderblom, IJ (Acting Principal until 31 Jul 2018)

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iv. Performance in terms of its statutory functions, explained in Section 10(1)-(3) of the CET Act.

The statement of Council on governanceBoland College had a fully functional College Council in 2018. Four Council meetings, one Special meeting and a Council Risk Workshop were held. Key Governance matters such as the Budget, Academic Fees of the College, the 2019 Strategic Plan and the 2017 audit outcomes of the College received meticulous attention. The Committees of the Council: Finance, Audit and Risk, Human Resources, Planning and Resources, met at least once a term, and in doing so rendered support to the College management to achieve the goals of Boland College.

The statement of Council on college functionalityThe Boland College Council performs all its functions, including the review of the Standard Statute, which are necessary to govern a public college, subject to the Act and any applicable national or provincial law.The Council, with the concurrence of the academic board, developed a strategic plan for the College that:

> incorporates the mission, vision, goals and planning for funding of the College;

> addresses past imbalances as well as gender and disability matters;

> adheres to safety measures for a safe learning environment for students, lecturers and support staff; and these are approved by the Members of the Executive Council;

> determines the language policy of the public College, subject to the approval of the Members of the Executive Council; and

> ensures that the College complies with accreditation requirements necessary to provide learning programmes in terms of standards and qualifications as registered on the National Qualifications Framework.

The Council, after consultation with the Student Representative Council, makes provision for a suitable structure to advise on policy for student support services within the College.

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6 . 2 . T H E R E P O R T O F C O U N C I L O N R I S K A S S E S S M E N T A N D M A N A G E M E N T O F R I S K S

BOLAND COLLEGE RISK MANAGEMENT STRATEGY

Risk management is defined as the process of identifying, monitoring and managing potential risks in order to minimize the negative impact they may have on an institution.

In 2018 the Risk Management Committee oversaw the risk processes at Boland College. The Strategic and Operational risk registers were updated every quarter with the process owners taking responsibility for the risks within their departments. At the annual risk meeting a new risk register was developed for each process. Together with the Vice-Principal, the process owners monitor, assess and develop mitigation measures for each risk. The updated risk registers are loaded on the QMS for easy access and utilisation by all staff.A special Risk Workshop was held with the College Council in August 2018 to discuss the methodologically broader process of Risk Management and the Council and Management view on the Boland College risks.The top strategic risks were discussed at the Audit and Risk Committee meetings and the top operational risk, of each process, circulated to the Audit and Risk Committee.

The Boland College Risk Management Policy is in line with the requirement of the King Code on Corporate Governance for South Africa (King IV – 1 April 2017).

Principle 8: “The governing body should ensure that its arrangements for delegation within its own structures promote independent judgement, and assist with the balance of power and effective discharge of duties”

All risks that Boland College had to contend with in 2018, were managed in a structured manner.

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During 2018 the implementation of audit action plans was monitored and corrective actions were taken where needed. The audit action plans were based on external audit findings of the College, the Auditor General’s findings as provided by DHET, internal audit findings and risks according to the Risk Register.

In-Year Management and Monthly/Quarterly Report

The College reported to DHET every month regarding the status of the income and expenditure. The Audit and Risk Committee was satisfied with the current content and quality of the quarterly financial and performance reports prepared and issued by the Accounting Officer of the College during the year under review.

Evaluation of 2017 Financial Statements

In 2018, the Audit and Risk Committee has:

> Reviewed and discussed the audited 2017 annual financial statements presented in the annual report;

> Reviewed the external auditor management report and management’s responses thereto;

> Considered changes to the accounting policies and practices, and where applicable, ensured that these were reported in the 2017 annual financial statements.

Risk Management

The College appointed a risk officer during the latter half of the year. The risk management function and the process are reviewed on a quarterly basis by the Audit and Risk Committee.

External Auditor’s reportWe have reviewed the College’s implementation plan for audit issues raised in the 2017 financial year, and we are satisfied that the matters have been addressed as reported by the External Auditor. The Audit and Risk

6 . 3 . R E P O R T S B Y C O M M I T T E E S O F T H E C O U N C I L

i . AUDIT COMMITTEE

We are pleased to present our report for the financial year ended December 2018.

Audit and Risk Committee Responsibility

The Audit and Risk Committee complied with its responsibilities arising from Section 25 (1) (c) of the Continuing Education and Training Act, Act 16 of 2006 as amended, by “implementing internal audit and risk management systems which are not inferior to the standards contained in the Public Finance Management Act, 1999 (Act 1 of 1999)” and Generally Recognized Accounting Practices (GRAP). The Audit and Risk Committee has updated its Audit and Risk Charter, has regulated its affairs in compliance with the Charter and has discharged all its responsibilities as contained therein.

The Effectiveness of Internal Control

The internal audit department did not operate at full capacity during the financial year. Advertisements were placed and the position of internal auditor was filled in the latter half of the year. As a committee we did feel a non-staff member would have been preferred. We are however very happy with the excellent performance of the appointed member. We also, however, do feel that sufficient capacity still does not exist. Recently a panel of external auditors was appointed by the audit committee which will provide welcome relief. It is the aim of management to increase the capacity of internal audit to the same annual hours spent by the external auditors. We did review in a limited way the results of internal audit engagements, which were based on the risk assessments conducted in the College.

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Committee has met with the College to ensure that there are no unresolved issues emanating from the regulatory audit. The Audit and Risk Committee concurs and accepts the conclusions of the External Auditor on the annual financial statements.

AppreciationThe Audit and Risk Committee wishes to express its appreciation to the Management of the College in a very tough and challenging year, and for the co-operation and information they provided to enable the committee to fulfil its mandate and to compile this report.

HA VAN DER MERWE // Audit and Risk Committee Chairperson

12 March 2019

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i i . F INANCE COMMITTEE

The Finance Committee had been fully constituted and chaired by an external Council member. Four quar-terly meetings were held. The committee oversaw and approved College budget submissions, deviations and quarterly revisions to ensure that the required outputs were specific and consistent with the desired outcomes.

As was similar to the end of 2017, the committee had serious cash flow challenges starting off the 2018 finan-cial year with the “fees must fall” campaigns. During the year 2018, welcome relief came about with more reliable government funding. It is however still not ideal, with the College not being able to fall back on ample general reserve funds.

Also, for a big part of 2018, the College had to do without a permanent CEO (Chief Executive Officer). In spite of these challenges, we as a Finance Committee can proudly state that the College management has done an outstanding job and has mitigated the risks presented very well.

HA VAN DER MERWE // Finance Committee Chairperson

12 March 2019

i i i . CONDITIONS OF EMPLOYMENT COMMITTEE

The Human Resources (HR) Committee oversees the conditions of employment of staff appointed at Boland College. Both the Chairperson and Vice-chairperson are external members of Council, in compliance with the CET Act. The Committee met quarterly, and meetings were well attended. Policies received from the Department of Higher Education and Training were perused and recommended to Council for aoption.

The functions of the Committee included the recommendation of employment of Council staff members and recommending termination of services of Council staff members relating to dismissal cases in-cluding conduct, capacity and operational requirements (retrenchments). The HR Committee also recommended approval of applications received for conducting private work and reviewed the employment equity targets and affirmative action measures of Boland College. The HR Training Plan was submitted to the committee and the progress on implementation was monitored quarterly. The Staff Code of Conduct and Excellence Awards Policy were reviewed by the Committee.

This committee has an important role to ensure that parity with regard to conditions of employment exists be-tween the DHET-appointed and Boland College Council-appointed staff.

iv. PLANNING AND RESOURCE COMMITTEE

The Planning and Resources Committee plays a key role in the College’s planning processes. Its mandate is to assist Council and Management in the planning, monitoring and evaluation of the College’s strategic plan and the evaluation of infrastructure and ICT

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resources. The committee includes three external Council members, one of whom is the Chairperson.

The committee met quarterly during 2018 and paid particular attention to infrastructure and ICT planning. On the infrastructure side, the identification of deferred and urgent infrastructure projects received attention, as well as ongoing efforts to reduce the College’s water consumption. With regard to ICT (information and communication technology), the Committee reviewed efforts by the ICT Department to respond to recommendations by the Auditor-General.

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6 . 4 . A C A D E M I C B OA R D R E P O R T

The functions and powers of the Academic Board are set out in the Continuing Education and Training Act, No. 16 of 2006 (as amended). The Boland College Academic Board Terms of Reference, which was approved by the College Council in 2016, was reviewed in 2018 in terms of its membership, with particular reference to its membership as it pertains to resignations and members serving in acting positions at the college.

The Academic Board is accountable to the Council for:

> All teaching, learning, research and academic functions of the College;

> The academic functions of the College and promoting the participation of women and the disabled in its learning programmes;

> Establishing internal academic monitoring and quality promotion mechanisms;

> Ensuring that the requirements of accreditation to provide learning against standards and qualifications registered in the National Qualifications Framework (NQF) are met; and

> Performing such other functions as may be delegated or assigned to it by the Council.

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> The planning, organisation and supervision of programme delivery and examinations: – Advising the Council on a Student code of conduct

and rules, – Advising the Council on the Conditions applicable to

any scholarships/financial aid.> The establishment of any committees;> Advising the Council on student admission

requirements;> Reporting to the Council on reports, research projects

and recommendations.

The Academic Board does not have decision-making authority, but submits recommendations for approval to the Council.

The Academic Board of Boland College consisted of:

> The Principal> The Vice-Principals of Education & Training

and Innovation & Development > External Members of Council (4)> Campus Managers > Senior Academic Manager> Heads of Departments> Programme Managers> Lecturing Staff> Members of the Student Representative Council> Programme Manager> Quality Manager> Student Support Manager

The Academic Board meets quarterly

> The Principal is the chairperson of the Academic Board who ensured that four meetings per annum were held in 2018.

> The input of the Council members, academic staff and student representatives contributed to the success of the deliberations during the meetings.

> The Vice-Principal: Education and Training reported achievements and challenges of education and training at each meeting.

> The Vice-Principal: Innovation and Development reported on Student Support Services which included reports on Work Integrated Learning, Partnerships and the Student Representative Council.

6 . 5 . S T U D E N T R E P R E S E N T A T I V E C O U N C I L R E P O R T

In line with the CET Act, students have representation on all Boland TVET College governance structures. As an institution, Boland TVET College recognises and values our Student Representative Council as the umbrella representative body of students.

The approach of Boland TVET College to student development leadership initiatives is unique. Rather than focus on development initiatives at the start of the term of office of student leaders, the student leadership development initiatives focus on providing student leaders with support throughout their term of office. Boland TVET College is of the firm view that student leadership development initiatives are important in providing student leaders with the necessary support and skills for effective leadership that is relevant to the current context, as well as inclusive in approach. Student leadership development not only assists student leaders through an experiential approach that is grounded in a theoretical framework, but it also communicates to student leaders that they are valued, appreciated and considered integral to the governing structures at Boland TVET College.

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The Student Representative Council started off 2018 prepared to be of service to prospective and returning students during the registration period. All five Boland College Campuses reported that the first week of registration was positive with a great number of prospective students that showed up for both registration and new bursary applications.

2018 was the second year that Boland TVET College was part of the NSFAS Online Application process. A huge number of new and senior students were already assisted at end of 2017 with registering on the MyNsfas online portal. Despite ongoing challenges with the online bursary application process, the Financial Aid Department was able to assist students in a very efficient manner, ensuring that all students that qualify for financial assistance were supported with the application process.

The welcoming programme for new students took place on all campuses and was reported to be a huge success. Research has indicated that students are more likely to finish their studies if they successfully make the transition from school to college and also if they have a sense of belonging. The Welcoming Programme introduces new students to Campus Management, provides important information about the institution, is an opportunity for social interaction through fun activities, and to discuss important Policies and the Student Code of Conduct with new students. It also serves as introduction to community resources. It helps familiarize students with the new environment they have just joined. Although

it was fun and games, it played a vital role in building cohesion in order for them to work together and to have interpersonal communication with their classmates. We hoped that this experience would be transferred to the learning environment.

The OLCs on all campuses are accessible for all registered students to use. In June 2017, the Financial Aid Clerks were moved to the OLC and are now permanently placed there operating as Student Liaison Clerks. The OLC is open during business hours. Students have access to computers and the internet at the OLC to do their work on a daily basis. It also serves as a clean learning environment for students. It is evident in the number of students that visit the OLC on a daily basis that this service is much needed.

The academic support periods have been implemented across campuses. This additional support is conducted within the academic timetable and specifically for English and Maths. It is evident from student feedback that this academic support has been of great value. On most campuses there is also additional support with computer practicals for students.

The SRCs of the various campuses make use of the Student Parliament not only to attend to student issues, but to also inform all students about matters that concern them.

Boland TVET College acknowledges the importance of structured mass participation in extracurricular

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activities (sports, arts and culture) and strives to create opportunities for holistic development of students. In 2018 the following events took place across campuses and provincially, amongst TVET Colleges: Athletics on provincial level and a Provincial Choir Festival.

As we diligently invest in the development of our Student Leaders, various documents and processes were developed with inputs from the Broad Management and Student Leaders for implementation. With the guidance of a professional consultant, the approach to their training was to promote dialogue for encouraging different perspectives and opinions. Together with the SRC Central Executive Committee, their constitutionand the guidelines to carry out SRC responsibilities according to each portfolio were reviewed. Some changes were made in order to fit the needs of ourSRC on the various campuses.

The election process of the SRC for 2018/’19 started in May 2018 with the opening of nominations. Independent Electoral Commission (IEC) trained officials conducted all elections, ensuring that the election of the Student Representative Council (SRC) was fair, transparent and done in a democratic manner. The election of the new SRC members was able to take place without any disruption in August 2018.

The newly elected SRC members attended a training camp at the end of September 2018. Topics that were covered included the mandate of the SRC, the CET Act, effective leadership, communication with management, project and time management, to name but a few. The successful Inauguration of the new SRC 2018/’19 took place in October 2018 at Stellenbosch campus. On this occasion, the newly elected student leaders signed their Code of Conduct and received their official SRC blazers.

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The biggest challenge in 2018 was the fill ing of posts at senior level.

The Chief Financial Officer (CFO) was acting as Principal for 13 months before the Principal’s post was filled permanently. It also affected the Finance Department as the Senior Manager: Assets and Procurement was acting as CFO. The newly appointed Principal was the former Vice-Principal: Corporate Services (CS), which created a new vacancy, still not filled by the department. The successful candidate for the VP: CS (Acting) post is a campus manager, leaving a new temporary vacancy for a crucial post. The movement of staff is a common occurrence, but the time line from recruiting to appointment is too long and carries the potential risk of instability.

On 15 October 2018, an Internal Auditor/Chief Risk Officer was appointed in a permanent position, addressing the human resource need for managing this extremely important function. We were also successful in recruiting a Labour Relations Senior Officer and

Marketing and Corporate Communications Manager. The ICT Systems Manager and Infrastructure Manager posts are still vacant, but the recruitment process has commenced and appointments will soon be made.

Despite the understaffing and movement in Senior Management, all functions were still performed at a high level of service delivery. It is remarkable that all administrative and management performance goals were met and I ascribe this to loyal, dedicated and hardworking staff.

07R E P O R T B Y T H E P R I N C I P A L O N M A N A G E M E N T A N D A D M I N I S T R A T I O N

PERFORMANCEINFORMATION

C

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7 . 1 H I G H - L E V E L O R G A N I S A T I O N A L S T R U C T U R E

7 . 2 S T A F F E S T A B L I S H M E N T ( A S A T 3 1 D E C E M B E R 2 0 1 8 )

P R I N C I PA L V I C E P R I N C I PA L S

A C T I N G P O S I T I O N S

VP: Corporate Services, Campus Manager: Strand, Campus Manager: Caledon

VA C A N T P O S T S

VP: Corporate Services,Senior Manager: Education and Training

L E C T U R I N G S T A F F

T O T A L

S U P P O R T S T A F F

P R I N C I PA L

J J M C O E T Z E E (S ince 1 August 2018)

// I J G E L D E R B L O M (Acting Pr incipal)

(1 Januar y 2018 - 31 July 2018)

V I C E P R I N C I PA L

E D U C A T I O N & T R A I N I N G

// E P E T E R S

V I C E P R I N C I PA L

C O R P O R A T E S E R V I C E S

// H D P L A AT J I E S (Acting)

(S ince 1 November 2018)

// I J G E L D E R B L O M

(Acting) (1 August 2018

- 31 October 2018)

// J J M C O E T Z E E

(1 Januar y 2018

- 31 July 2018)

V I C E P R I N C I PA L

F I N A N C E

I J G E L D E R B L O M

(S ince 1 August 2018)

// C R N E A L (1 Januar y 2018

- 31 July 2018)

S E N I O R M A N A G E R

A S S E T S & P R O C U R E M E N T

// C R N E A L

(Unt i l 14 October 2018)

I N T E R N A L A U D I T & C H I E F R I S K O F F I C E R

// C R N E A L (S ince 15 October 2018)

S E N I O R M A N A G E R

E D U C A T I O N & T R A I N I N G

// S R A U B E N H E I M E R

C A M P U S M A N A G E R S

C A L E D O N // S S I E B E R H A G E N

// E B O N G E R S

(Acting) (Unt i l 31 December 2018)

PA A R L // I H A R T M A N

S T E L L E N B O S C H // N M PAT I

S T R A N D // H D P L A AT J I E S

( Unti l 31 October 2018)

// S Emjedi (Acting)

(1 November 2018 -

31 December 2018)

W O R C E S T E R // C C O R D I E R

V I C E P R I N C I PA L

I N N O VA T I O N & D E V E L O P M E N T

// W A D A M S

01 03

03 02

151

369

210

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It is necessary to see the link between proper planning, implementation, control, measuring, analysing and improvement, for the College to perform well. Basic elements needed for performance are human and infrastructure resources. Our strategic plan guides our operational plans. The Deming cycle (plan-do-check-act) is used to ensure that we achieve a high level of College performance. Quarterly measurement and

2 0 1 4 - 2 0 1 8 H E A D C O U N T T R E N DA L L P R O G R A M M E S

Programme 2014 2015 2016 2017 2018

NC(V) L2 - L4 1 834 2 053 1 821 1 469 1 239

Eng. N1 - N6 618 604 628 676 852

Bus. N4 - N6 4 662 4 987 5 408 5 359 6 332

Occupational 3 455 3 100 3 747 2 890 1 497

TOTALS 10 569 10 744 11 604 10 460 9 920

9 . 1 . E N R O L M E N T P E R F O R M A N C E ( H E A D C O U N T S )

All NC(V) enrolments in terms of headcounts declined from 2016 to 2018. However, from 2017 to 2018 there was a headcount increase for the Report 191 Business Studies programmes of 973 and Engineering Studies N1-N6 where there was a total increase of 176. The latter is attributed to the fact that Boland College introduced N4 – N6 Electrical Engineering Studies at Strand Campus for the first time from 2017. The overall decrease in enrolment was 1 024 which was distributed as follows:

The assumption made previously still holds in that the large decline in NC (V) could be attributed to the fact that more potential students that would qualify to enter at level 2, remained at schools where there is no need generally to qualify for bursaries or to sit for national examinations at the levels of grades 10 and 11 (equivalent of Levels 2 and 3), nor to meet the stringent pass requirements of the NC (V) programmes.

reporting on the achievement of targets ensures that all efforts to perform and deliver are aligned and on track. Continuous monitoring is done through our various management structures, inter alia EXCO, Broad Management Forum, Academic Management meetings, and Internal EDT Quality Assurance meetings, amongst others.

The College continued to grow in both the N1 – N6 Engineering programmes as well as the Business and Utility Studies N4 – N6. There was a decline in the occupational numbers as the college decided, in order to improve quality, to firstly consolidate all its existing obligations related to occupational courses before taking more contracts on in a major way.

The following are some of the achievements:

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C O L L E G E P E R F O R M A N C E A N D O R G A N I S A T I O N A L E N V I R O N M E N T

P E R F O R M A N C E R E P O R T I N G

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9 . 2 . N C ( V )

We are very pleased with our NC(V) 2018 national examination results. Statistics provided by the DHET on the NC(V) subject pass rate performance of all 50 public TVET Colleges confirms the following:

> Boland College is rated 2nd best out of 50 public Colleges nationally, with an overall subject pass rate of 87.7%.

> 2 of our campuses, namely, Stellenbosch and Paarl, were rated 3rd and 4th respectively out of 264 campuses nationally. Stellenbosch campus achieved a 91.7% subject pass rate and Paarl campus 91%. Boland was also the only college in the country that had 2 campuses rated amongst the top 5.

A N A LY S I S 2 0 1 4 - 2 0 1 8 N C ( V ) E X A M I N A T I O N R E S U LT S

Levels

Subject Pass Rates Retent ion Rate Cert i f icat ion Rate

2015 2016 2017 2018 2015 2016 2017 2018 2015 2016 2017 2018 2018 Target

Level 2 86% 88% 94% 86% 63% 54% 55% 65% 32% 26% 33% 28%

Level 3 82% 86% 94% 88% 79% 82% 82% 81% 25% 27% 48% 42%

Level 4 92% 90% 90% 93% 88% 89% 92% 93% 45% 41% 45% 45% 48%

With reference to the above table:

The Level 2 subject pass rate decreased from 94% in 2017 to 86% in 2018, but the retention rate improved from 55% to 65% over the same period. The improvement on the 2017 performance can be attributed to more students complying with the DHET examination admission requirements in terms of attendance and that of the sub-minimum Internal Continuous Assessment (ICASS).

> The Level 3 subject pass and retention rates decreased from 94% in 2017 to 88% in 2018 and from 82% in 2017 to 81% in 2018 respectively. There was a slight decrease in the level 3 certification rate, from 48% in 2017 to 42% in 2018.

> None of our 5 campuses achieved below 81.8% with 4 of our campuses being in the top 20 nationally.

The table below provides an analysis of the Levels 2 – 4 examination results in terms of subject pass, retention and throughput rates, as well as the certification rates on each level of the NC (V) programme.

> At Level 4, both the subject pass and retention rates increased slightly from 90% in 2017 to 93% in 2018 and from 92% in 2017 to 93% in 2018 respectively, whilst the certification rate remained constant at 45%.

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A N A LY S I S 2 0 1 4 - 2 0 1 8 N 1 – N 6 E N G I N E E R I N G E X A M I N A T I O N R E S U LT S

Levels

Subject Pass Rates Retent ion Rate Cert i f icat ion Rate

2015 2016 2017 2018 2015 2016 2016 2018 2015 2016 2017 2018 2018 Target

N1 82% 90% 94% 95% 75% 70% 73% 63% 43% 41% 46% 45%

N2 34% 59% 66% 60% 88% 67% 79% 74% 13% 18% 26% 22%

N3 59% 65% 66% 79% 86% 89% 84% 88% 15% 31% 23% 41% 43%

N4 84% 90% 84% 72% 44% 40%

N5 70% 47% 92% 83% 21% 21%

N6 50% 57% 90% 100% 8% 13% 60%

9 . 3 . N 1 - N 6 E N G I N E E R I N G S T U D I E S E X A M I N A T I O N R E S U LT S

The table below provides an analysis of the Report 190/1 Engineering N1 – N6 examination results in terms of subject pass and retention rates, as well as the certification rates on each level of the Report 190/1 Engineering programmes.

With reference to the above table:

> N1, and N3 subjects pass rates improved respectively from 94% and 66% in 2017 to 95%, and 79% in 2018. There was decline of 6% on the N2 level. The N1 and N2 retention rates decreased respectively from 73% in 2017 to 63% in 2018 and from 79% in 2017 to 74% in 2018. The N3 retention rate increased from 84% in 2017 to 88% in 2018.

> Similarly, the N1 and N2 certification rates decreased respectively from 46% and 26% in 2017 to 45% and 22% in 2018. The N3 certification rate improved significantly, from 23% in 2017 to 41%.

> The 2018 N4 and N5 subject pass and retention rates in comparison to that of 2018 were quite disappointing. However, the 2018 pass, retention and certification rates improved significantly compared to that of 2017 although there is a need for an even greater improvement.

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A N A LY S I S O F 2 0 1 4 - 2 0 1 8 N 4 – N 6 B U S I N E S S S T U D I E S E X A M I N A T I O N R E S U LT S

Levels

Subject Pass Rates Retent ion Rate Cert i f icat ion Rate

2015 2016 2017 2018 2015 2016 2017 2018 2015 2016 2017 2018 2018 Target

N4 87% 95% 92% 92% 88% 81% 82% 82% 56% 59% 56% 55%

N5 91% 86% 89% 90% 91% 89% 86% 88% 52% 50% 48% 52%

N6 95% 89% 90% 92% 95% 94% 91% 90% 49% 54% 51% 54% 60%

9 . 4 . N 4 – N 6 B U S I N E S S S T U D I E S E X A M I N A T I O N R E S U LT S

The table below provides an analysis of the Report 190/1 N4 – N6 examination results in terms of subject pass and retention rates, as well as the certification rates on each level of the Report 190/1 Business Studies programmes.

With reference to the above table:

> N5 and N6 subjects pass rates improved respectively from 89% and 90% in 2017 to 90% and 92% in 2018. The certification rates equally improved from 48% in 2017 to 52% in 2018 on N5 and from 51% in 2017 to 54% on N6 in 2018.

> The N4 results over the same period remained fairly constant.

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9 . 5 . E - L E A R N I N G

During 2018, further developments to enhance the implementation of e-learning were embarked upon. Some of the strides made include the following:

> On 30 May 2018 the College Council adopted the widely consulted e-learning policy and strategy. The strategy particularly focuses on: – Creating an e-learning awareness – Creating an e-learning structure to implement the e-learning policy – Building lecturer capacity regarding e-learning – Establishing an Academic Digital Footprint.

> An e-learning committee was established at each campus in order to support the roll-out of e-learning. A Terms of Reference was drafted to assist the committee in its work.

> A second cohort of staff was exposed to the Moodle Introductory Module. This was followed by additional training during September 2018. The uptake in using the platform was initially slow, but has gained momentum through the support of the campus managers and the campus e-learning committees to the extent that lecturers are also being supported wherever possible in their classes.

> Key staff also attended 2 DHET-initiated Open Learning workshops.

9 . 6 . A C A D E M I C S U P P O R T

Academic support is driven by focused, well planned interventions, based on pre-approved criteria which amongst others include performance in the ICASS (Internal Continuous Assessment) and the National examination. The aforementioned, coupled to a realistic budget for Academic Support in targeted poorly performing subjects, including specific subjects such as Mathematics and Mathematical Literacy, has brought about an overall significant improvement in examination results. Academic interventions included the following:

> In-class support by means of class assistants;> Tutoring;> Additional periods allocated for ‘poor’

performing subjects;> E-learning support and special software programmes;> Extra classes;> Specific intervention programmes before the start

of formal classes, for example the ‘Ready Steady’ Mathematics programme.

The Western Cape Department of Economic Development and Tourism (DEDAT) provided funding for a second round of support for the appointment of a Mathematics Class Assistant at Strand campus.

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1 0 . 1 . S T R A T E G I C O B J E C T I V E 1

TO STRENGTHEN GOVERNANCE, MANAGEMENT AND LEADERSHIP

The College has achieved its goal to ensure that 16 College Council Members and 5 Management Members were aware of their role and responsibilities, had been fully functional and contributed to the success of Boland College. Council members were from specialised disciplines representing, inter alia, Academia, Law, Business, Finance and Human Resources. These governance structures ensured that relevant training, in line with the vision of the College, was offered. All actions and activities were performed within the guidelines of the Boland College Statute.

The following sub-structures supported the Council and strengthened governance, management and leadership:

> Governance structures: Council, Academic Board, Student Representative Council

> Council subcommittees: Finance Committee, Audit & Risk Committee, Planning & Resources Committee (PLANCO) and Human Resource Committee.

> Management: EXCO and Broad Management Forum

1 0 . 2 S T R A T E G I C O B J E C T I V E 2 :

TO INCREASE ACCESS AND PROVIDE EFFECTIVE SERVICES TO STUDENTS

The College achieved the following goals to ensure institutional capacity and efficiency in terms of the provision of access and support services to students:

> Expanded e-learning by training more than 80 lecturers on Moodle

> Focused on measuring performance and impact of Academic support interventions by setting clear criteria to identify ‘subjects at risk’, to provide budget and resources when agreed upon, to analyse and monitor results, and evaluate performance once interventions are initiated.

> Specifically focused on Mathematics, Mathematical Literacy and other historically poorly performing subjects by having standard interventions on a continuous basis, for example by planning and approving in advance the appointment of class assistants for the entire year to assist with challenging areas of the curricula.

> Offered occupational programmes on demand through Seta, WCED, and other funding sources and within the College’s capacity.

> Placed 5 lecturer staff in workplaces.

Improved linkages with Industry

The College had been constantly attempting to partner with industry in order to increase its footprint in education and training, so that its learners have the best opportunities whilst at the College and also when they exit. The following are some important linkages which started in 2018:

> The College remains an active participant in WorldSkills South Africa at both provincial and national levels.

A C H I E V E M E N T O FS T R A T E G I C O B J E C T I V E S

10

30

1 0 . 3 . S T R A T E G I C O B J E C T I V E 3 :

TO IMPROVE THE INFRASTRUCTURE CAPACITY OF BOLAND COLLEGE TO OFFER LEARNING OPPORTUNITIES

The Infrastructure department was faced with challenges with regard to the provision of water and electricity and had to come up with innovative utilisation of existing resources and facilities within financial constraints. Water and electricity saving measures were widely communicated and reported on within the College. The Green Initiative not only focused on the sustainable use of our resources, but also made an impact with regard to the reduce, re-use, recycle project.

Some of the available residence buildings were rented out in 2018 to balance the financial shortfall on funding for residences. This initiative enabled us to accommodate approximately 500 students in the College residences.

During 2018, the DHET Infrastructure grant for maintenance of colleges was launched. Unfortunately, both the Infrastructure Manager and Infrastructure Officer that had received the training and did the planning for the implementation, have left our service. Subsequently, the College has procured the services of a Project Manager who will manage and oversee this project.

As a whole, the College succeeded in providing the necessary infrastructure needed to achieve the goal of supporting teaching and learning.

1 0 . 4 . S T R A T E G I C O B J E C T I V E 4 :

TO DEVELOP PARTNERSHIPS AND MAINTAIN GOOD STAKEHOLDER NETWORKING TO INCREASE THENUMBER OF STUDENTS WHO ARE ADEQUATELY PREPARED TO ENTER THE LABOUR MARKET

One of the eight identified millennium goals of building a global partnership for development, was embraced by Boland College to strengthen its mandate with industry. Through industry, companies are able to collaborate with the College to build capacity which brings the skills that business requires. These mutually rewarding relationships provide a sustainable partnership, which will be of wider social and economic benefit to the country.

As we are striving to uphold the theme of DHET, ‘turning every workplace into a training space’, we were obliged to focus on sourcing relevant partners in order for our exit level and occupational students to gain relevant experience. Work integrated learning (WIL) is seen as an important way to improve the quality of teaching and

The College had a number of applicants who entered the national competition. One of our candidates, Zanco Jantjies, a Bricklaying student, won the Provincial competition and went on to represent the Western Cape nationally. He achieved a Bronze medal at the National Competition that was held at the Durban ICC. > The DEDAT (Department of Economic Development

and Tourism) also continued to support the College with a full-time Mathematics Assistant at our Strand campus in order to improve the performance of identified students doing Mathematics. The DEDAT also financially supported the 6 Western Cape public TVET colleges in order to improve its performance at the Worldskills competition, whereby R2 million was made available for the running of the provincial competition, capacity building of competitors and judges, and marketing and branding of the competitions.

> Boland College entered into agreements with Jan Smit Consulting and SkillsAdvise to offer training from our Worcester Campus in the field of Automotive Repair and Maintenance for the Motor Vehicle Service Centres in the Boland and surrounding areas. The need for this relationship is based on a need indicated by a group of service centres in the Worcester and surrounding areas. The service centres are represented by Guy van Zyl from Audensberg Toyota in Worcester. The group of dealerships are referred to as the BATI (Boland Automotive Training Initiative). In 2018, the college very successfully provided training to this industry in Automotive Repair and Maintenance, NQF Levels 2. The accreditation process for Automotive Repair and Maintenance, NQF Levels 3 and 4 services is well underway. The intention is to expand and offer the full suite of motor and diesel mechanic qualifications to the industry, including the following: – All phases of CBMT (Competency Based Modular Training) as well as all related Level Testing, – RPL (Recognition of Prior Learning), – Trade Testing and the Occupational Certificate: Automotive Motor Mechanic, SAQA ID 97990.

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learning, as well as to attain greater alignment between College curricula and the skills needs of industry. As our placement market changed, we had to critically look at our PRODUCT and BRAND.

The transition of students from a theoretical training environment into the world of work can be a traumatic and unsettling experience for students who are ill prepared for the complexities and rigours of entering the job market; hence our constant interventions in the form of job readiness workshops and work-based experience (WBE).

1 0 . 5 S T R A T E G I C O B J E C T I V E 5 :

TO IMPROVE CORPORATE ADMINISTRATION AND MANAGEMENT TO ENSURE CONTINUOUS BUSINESS EXCELLENCE

The effective functioning of the Integrated Business Management System (Coltech Student Administration System, SAGE Evolution Financial System and Sage People Management System) ensured that the college could function optimally and could take appropriate action where deficiencies were detected. The system integrates and manages the Human Resources, Financial, Student Administration and ICT functions and data. It ensures a high level of data accuracy and reliability. The security and integrity of data is also ensured by the system, and multi-layered backup systems are provided. The implementation of a wide area network enables video conferencing and improves staff productivity as they do not necessarily

have to travel to other sites. The Moodle platform was successfully implemented for e-learning opportunities for students.

1 0 . 6 . S T R A T E G I C O B J E C T I V E 6 :

TO DEVELOP AND IMPLEMENT A GREEN INITIATIVE IN TERMS OF THE TVET COLLEGE MONITORING AND EVALUATION FRAMEWORK

The best environmentally friendly practices were used in refurbishment projects and will also be used should we erect new buildings. The use of transport is continuously under scrutiny to reduce the impact on the environment. Initiatives such as having video-conferencing rather than meetings involving travel, co-ordinating travel arrangements, using blue motion vehicles, etc. were implemented. Continuous efforts were made to create a green culture within the College through awareness campaigns. The recycling of paper, tins, glass and fluorescent lamps has become an integrated activity at the College.

The goal of having the Environmental Process audited for Compliance with ISO 14001 could not be achieved but will be addressed in 2019.

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C O L L E G E A C H I E V E M E N T I N T E R M SO F S T R A T E G I C S Y S T E M T A R G E T S

S T R A T E G I CS Y S T E M T A R G E T

TVET Col lege 2017/18

Achieved Target

TVET Col lege 2018/19

Planned Target

TVET Col lege 2018/19

Achieved Target

Explanatory remarks regarding analysis and

achievement

Head count enrolment (n) 9 432 10 374 9 920

State Funded 6 660 7 773 8 030

College Funded 365 358 393

Other sources 2 407 2 243 1 497

The college has strategised on increasing its occupational programmes by reorganising the unit in 2018.

Certification rates inTVET qualifications (%)

NC(V) L4 45% 48% 45%Strategies adopted to improve academic performance.

N3 40% 43% 41%Improvement strategy implemented.

N6 56% 60% 34%Reported on combined average of Business studies and Engineering studies.

Throughput (%) 33% 33% 51%

Funded NC(V) L4 students obtaining qualification within stipulated time (%)

35 15 11

Qualifying TVET students obtaining financialassistance (n)

5 089 7 800 12 986

Deviation due to enrolment of more students in the previous year, we have a marginal increase on students that applied for bursaries. More students qualified for funding than initially planned.

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S T R A T E G I CS Y S T E M T A R G E T

TVET Col lege 2017/18

Achieved Target

TVET Col lege 2018/19

Planned Target

TVET Col lege 2018/19

Achieved Target

Explanatory remarks regarding analysis and

achievement

Compliance with national policy when conducting national examinations and assessments (%)

100% 100% 100%

All examinations were conducted according to national examination guidelines.

Compliance to governance standards (%)

100% 100% 100% 100% compliance in terms of governance standards adhered to.

Students enrolled in artisan-related or occupational programmes (n)

1 311 1 400 955Strategy to counter decrease not as successful as anticipated.

TVET students placed in workplaces/industry for workplace-based learning (n)

2 719 3 231 680

Attributed to the following factors: Tough economic circumstances, limited stipend funding, limited host employers and only students that areacademically successful are placed. Not all exit level students in specific programmes can be accommodated.

TVET lecturers placed in workplaces for specified purpose (n)

5 9 5A policy will be developed in order to facilitate good work placement in future.

TVET students enrolled in foundation or bridging programmes (n)

282 270 285

Success rate in foundation or bridging programmes (%)

70% 70% TBC

External verification for certification requested from W&R SETA. Awaiting confirmation.

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H E A D C O U N T S

The headcount target was 10 374 and the actual figure achieved was 9 920. This represents a 454 shortfall. Although the NC (V) enrolment is declining for reasons previously stated, the strategy is to improve on the Report 191 enrolments and this approach is already yielding results. The college has strategized on increasing its occupational programmes by reorganising the unit responsible and making some strategic appointments.

A C A D E M I C R E S U LT S

NC(V) Level 4 certification rate

The College did not achieve its 2018 NC (V) Level 4 certification target of 48%. The actual achievement of 45% means it is below target by 3%. The DHET NC (V) Level 4 certification target for 2019/20 is 65% with a National APP target of 30% for 2018. This means that the DHET target is also not very realistic. The following are some of the strategies adopted to improve academic performance:> Campuses are to strengthen academic support to

improve retention and certification;> Programme managers and leaders must focus on

addressing student absenteeism; > Improve screening of placement in the various

programmes;> Prioritising poorest performing subjects for specific

interventions; > Special focus on Engineering subjects such as

Mathematics, Science and Drawings;> Campuses must emphasise the impact of the minimum

examination admission requirements in terms of Internal Continuous Assessments (ICASS), as well as that of attendance to ALL students.

N3 & N6 certification rate

The target certification rate of 43% for N3 and 60% for N6 was not achieved. The improvement strategy is generally the same as that above highlighted under

the NC (V) Level 4 under performance comments. In addition to this, some of the N4 to N6 Engineering subjects are impacting negatively on the overall N4 to N6 programme performance. Although the N6 business studies programmes did not reach their certification target of 60%, it is much better at 54% than the actual N6 Engineering programmes at 13%. The poorer performance in engineering subjects is not unique to Boland, but is the case at all colleges. The ‘at risk subjects’ and its root causes for poor performance have been clearly identified. In depth discussions with the affected managers at the different sites as well as the lecturers involved have taken place and the necessary guidance and resources made available to support improvement.

Students enrolled in artisan-related or occupational programmes

There was a decrease in the enrolment in NC (V) Artisan-related programmes, which the college attempted to counter with increased enrolments in the Report 191 and Occupational programmes, but it was not as successful as anticipated. For example, the college started offering N4 to N6 Electrical Engineering programmes. Similarly, the college sourced funders like the MerSeta and was successful in offering artisan-related unit standard based training and CBMT (Competency Based Modular Training) in welding, motor mechanics and electrical.

TVET students placed in workplaces/industry for workplace based learning

We experienced tough economic circumstances in the country as a whole. We only place students that are academically successful. We now have a placement official at all campuses. Stipend funding is limited, as

C O L L E G E A C H I E V E M E N T I N T E R M SO F S T R A T E G I C S Y S T E M T A R G E T S

12

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students are also supporting their families. The areas where campuses are situated do not have enough host employers to support our offerings. Host employers cannot accommodate all exit level students in specific programmes.

TVET lecturers placed in workplaces for specified periods

In order to positively report on this item, the College will finalise a Work Placement policy to support the strategy of having staff placed in industry. There is placement happening in the Early Childhood Programme where staff do visit and support learners in the workplace, but the programmes where the largest needs exist need to be identified.

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FINANCIALSTATEMENTSB O L A N D T V E T C O L L E G E

A N N U A L F I N A N C I A LS T A T E M E N T S F O R T H E Y E A RE N D E D 3 1 D E C E M B E R 2 0 1 8

1

IND

EX

0304

05-0910111213

14-2728-63

General InformationCouncil’s Responsibilities and ApprovalReport of the Auditor-GeneralStatement of Financial PositionStatement of Financial PerformanceStatement of Changes in Net AssetsCash Flow StatementAccounting PoliciesNotes to the Financial Statements

A B B R E V I A T I O N S

AG Auditor General

ASB Accounting Standards Board

DHET Department of Higher Education and Training

GRAP Generally Recognised Accounting Practice

SARS South African Revenue Services

VAT Value Added Tax

CET Act CET Act No.16 of 2006, as amended

These reports and statements comprise the annual financial statements presented for audit:

2

C O N T R O L L I N G E N T I T Y

Department of Higher Education and Training (DHET)

F I N A N C I A L S T A T E M E N T S R E L A T E T O

BOLAND TVET COLLEGE

D O M I C I L E , L E G A L F O R M A N D J U R I S D I C T I O N

The College is a Public Technical and VocationalEducation and Training College, constituted in terms of the Continuing Education and Training Act No.16 of 2006, as amended (CET Act), and operates from a Central Office situated in Stellenbosch, South Africa, with campuses in the following locations and serving the surrounding areas: Caledon, Paarl, Stellenbosch, Strand and Worcester.

Nature of business and principal activities

To provide continuing education and training to registered students for all learning and training programmes leading to qualifications or part qualifications at levels 1 to 4 of the National Qualifications Framework.

C O U N C I L L O R S

Bleazard, DK (Chairperson)Cloete, HCACoetzee, JJM (from 01-08-2018)Dyers, O (from 07-05-2018)Gelderblom, IJ (until 31-07-2018)Kabanyane, GCLingela, TSMacMaster, LLMMatolengwe, NMdludlu, MPeters, EPieterse, IPietersen, VRFPlaatjies, DVan der Merwe, HAVan Louw, CLVogel, A (from 16-04-2018)

P R I N C I PA L

Coetzee, JJM (from 01-08-2018)Gelderblom, IJ (Acting Principal until 31-07-2018)

C H I E F F I N A N C I A L O F F I C E R ( C F O )

Gelderblom, IJ (from 01-08-2018)Neal, CR (Acting CFO until 31-07-2018)

R E G I S T E R E D O F F I C E

85 Bird Street, Stellenbosch, 7600

B U S I N E S S A D D R E S S

85 Bird Street, Stellenbosch, 7600

P O S T A L A D D R E S S

Private Bag X5068, Stellenbosch, 7599

B A N K E R S

ABSA Limited

A U D I T O R S

Auditor General (SA)

G E N E R A LI N F O R M A T I O N

3

The council is required by the Continuing Education and Training Act No. 16 of 2006, as amended, to maintain adequate accounting records and is responsible for the content and integrity of the financial statements and related financial information included in this report. It is the responsibility of council to ensure that the financial statements fairly present the state of affairs of the College as at the end of the financial year and the results of its operations and cash flows for the year then ended, in conformity with GRAP. The Auditor-General was engaged to express an independent opinion on the financial statements and was given unrestricted access to all financial records, related data and relevant parties.

The financial statements have been prepared in accordance with the Standards of GRAP including any interpretations, guidelines and directives issued by the ASB and in the manner required by the Minister of Higher Education and Training.

The financial statements are based on appropriate accounting policies consistently applied and supported by reasonable and prudent judgements and estimates.

Council acknowledges that it is ultimately responsible for the system of internal financial control established by the College and places considerable importance on maintaining a strong control environment, which includes the safeguarding of assets and compliance with relevant legislation. To enable the council to meet these responsibilities, the council sets standards for internal control aimed at reducing risk in a cost effective manner. The standards include the proper delegation of responsibilities within a clearly defined framework, effective accounting and other procedures, and adequate segregation of duties to ensure an acceptable level of risk. These controls are monitored throughout the College and employees and management are required to maintain the highest ethical standards in ensuring the college’s business is conducted in a manner that in all reasonable circumstances is above reproach. The focus of risk management in the college is on identifying, assessing, managing and monitoring all known forms of risk across the college. While operating risk cannot be fully eliminated, the College endeavours to minimise it by ensuring that appropriate infrastructure, controls, systems and ethical behaviour are applied and managed within predetermined procedures and constraints.

The council accepts its responsibility to ensure that the College is managed in a responsible manner, considering the interest of all stakeholders, including the DHET, unions, employees, students, local communities and creditors. Responsible management entails, inter alia, compliance with applicable statutory and regulatory requirements, including risk management.

The council is cognisant of the qualified opinion of the Auditor General in respect of the 2017 Annual Financial Statements. Not withstanding the qualification, council is of the view, based on the information and explanations given by management, that the system of internal control provides reasonable assurance that the financial records may be relied on for the preparation of the financial statements and that the financial statements are free from material misstatement, whether due to fraud or error. However, any system of internal financial control can provide only reasonable, and not absolute, assurance against material misstatement or deficit.

The council has reviewed the College’s cash flow forecast for the year to 31 December 2019 and, in the light of this review and the current financial position, it is satisfied that the College has, or has access to, adequate resources to continue in operational existence for the foreseeable future.

The College is dependent on the DHET for continued funding of operations in line with the annual DHET programme funding allocation. The financial statements are prepared on the basis that the College is a going concern and that the DHET has neither the intention nor the need to liquidate or curtail materially the scale of the College’s operations.

The Auditor-General is responsible for independently auditing and reporting on the College’s financial statements and his report is presented with these financial statements.

The financial statements set out on page 10 to 63 were approved by the council representative on 29 May 2019 and were signed on its behalf by:

TS LINGELA // Council Chairperson

29 May 2019

C O U N C I L ’ S R E S P O N S I B I L I T I E S A N D A P P R O V A L

4

to the minister of Higher Education and Training andthe council on the Boland Technical and Vocational Education and Training College

R E P O R T O F T H E A U D I T O R - G E N E R A L

R E P O R T O N T H E A U D I T O FT H E F I N A N C I A L S T A T E M E N T S

O P I N I O N

1. I have audited the financial statements of the Boland Technical and Vocational Education and Training (TVET) College set out on pages 10 to 63, which comprise the statement of financial position as at 31 December 2018, the statement of financial performance, statement of changes in net assets and cash flow statement for the year then ended, as well as the notes to the financial statements, including a summary of significant accounting policies.

2. In my opinion, the financial statements fairly present, in all material respects, the financial position of the Boland TVET College as at 31 December 2018, and its financial performance and cash flows for the year then ended in accordance with the South African Standards of Generally Recognised Accounting Practice (SA Standards of GRAP) and the requirements of the Continuing Education and Training Act of South Africa, 2006 (Act no. 16 of 2006) (CETA).

B A S I S F O R O P I N I O N

3. I conducted my audit in accordance with the International Standards on Auditing (ISAs). My responsibilities under those standards are further described in the auditor-general’s responsibilities for the audit of the financial statements section of this auditor’s report.

4. I am independent of the college in accordance with the International Ethics Standards Board for Accountants’ Code of ethics for professional accountants (IESBA code) and the ethical requirements that are relevant to my audit in South Africa. I have fulfilled my other ethical responsibilities in accordance with these requirements and the IESBA code.

E M P H A S I S O F M A T T E R

5. I draw attention to the matter below. My opinion is not modified in respect of this matter.

R E S T A T E M E N T O F C O R R E S P O N D I N G F I G U R E S

6. As disclosed in note 40 to the financial statements, the corresponding figures for 31 December 2017 were restated as a result of errors in the financial statements of the college at, and for the year ended, 31 December 2018.

R E S P O N S I B I L I T I E S O F T H E C O U N C I L F O RT H E F I N A N C I A L S T A T E M E N T S

7. The council is responsible for the preparation and fair presentation of the financial statements in accordance with the SA Standards of GRAP and the requirements of CETA, and for such internal control as the council determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

5

8. In preparing the financial statements, the council is responsible for assessing the Boland TVET College’s ability to continue as a going concern, disclosing, as applicable, matters relating to going concern and using the going concern basis of accounting unless the intention is to liquidate the college or cease operations, or there is no realistic alternative but to do so.

A U D I T O R - G E N E R A L ’ S R E S P O N S I B I L I T I E S F O R T H E A U D I T O F T H E F I N A N C I A L S T A T E M E N T S

9. My objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes my opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

10. A further description of my responsibilities for the audit of the financial statements is included in the annexure to this auditor’s report.

P E R F O R M A N C E I N F O R M A T I O N R E P O R T I N G

11. The college is not required to prepare a report on its performance against predetermined objectives, as it does not fall within the ambit of the Public Finance Management Act of South Africa, 1999 (Act no. 1 of 1999), and such reporting is not required in terms of CETA.

R E P O R T O N T H E A U D I T O F C O M P L I A N C E W I T H L E G I S L A T I O N

I N T R O D U C T I O N A N D S C O P E

12. In accordance with the Public Audit Act of South Africa, 2004 (Act No. 25 of 2004) and the general notice issued in terms thereof, I have a responsibility to report material findings on the compliance of the college with specific matters in key legislation. I performed procedures to identify findings but not to gather evidence to express assurance.

13. The material findings on compliance with specific matters in key legislations are as follows:

6

A N N U A L F I N A N C I A L S T A T E M E N T S

14. The financial statements submitted for auditing were not prepared in accordance with generally recognised accounting practice as required by 25(1)(b) of CETA. Material misstatements of non - current assets and disclosure items identified by the auditors in the submitted financial statements were corrected, resulting in the financial statements receiving an unqualified audit opinion.

P R O C U R E M E N T A N D C O N T R A C T M A N A G E M E N T

15. Members of staff who had business interests in contracts awarded by the college failed to declare such business interests, in contravention of section 20(7) of CETA.

16. Members of staff of the college conducted business with the college without the council satisfying itself that such goods, products or services were unique, the supplier was a sole provider and it was in the best interest of the institution, as required by section 20(8) of CETA.

O T H E R I N F O R M A T I O N

17. The council and the principal of the Boland TVET College are responsible for the other information. The other information comprises the information included in the annual report, such as the council report and the principal’s report. The other information does not include the financial statements and the auditor’s report.

18. My opinion on the financial statements and findings on compliance with legislation do not cover the other information and I do not express an audit opinion or any form of assurance conclusion thereon.

19. In connection with my audit, my responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or my knowledge obtained in the audit, or otherwise appears to be materially misstated.

20. If, based on the work I have performed, I conclude that there is a material misstatement in this other information, I am required to report that fact. I have nothing to report in this regard.

I N T E R N A L C O N T R O L D E F I C I E N C I E S

21. I considered internal control relevant to my audit of the financial statements and compliance with applicable legislation; however, my objective was not to express any form of assurance on it. The matters reported below are limited to the significant internal control deficiencies that resulted in the findings on compliance with legislation included in this report.

L E A D E R S H I P

22. Adequate policies and procedures were not in place to ensure that approval was obtained from the council before employees conducted business with the college.

7

F I N A N C I A L A N D P E R F O R M A N C E M A N A G E M E N T

23. Management did not implement controls to identify employees who did not declare their business interest and who transacted with the college.

24. Management did not implement adequate review controls to ensure that the amounts disclosed in the financial statements are accurate, as material misstatements in the financial statements were identified during the audit and subsequently corrected by management. This resulted in material non-compliance with section 25(1)(b) of CETA.

Cape Town28 May 2019

A N N E X U R E – A U D I T O R - G E N E R A L ’ S R E S P O N S I B I L I T Y F O R T H E A U D I T

1. As part of an audit in accordance with the ISAs, I exercise professional judgement and maintain professional scepticism throughout my audit of the financial statements and the procedures performed on the college’s compliance with respect to the selected subject matters.

F I N A N C I A L S T A T E M E N T S

2. In addition to my responsibility for the audit of the financial statements as described in this auditor’s report, I also:

> identify and assess the risks of material misstatement of the financial statements whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control

> obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the college’s internal control

> evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the council

> conclude on the appropriateness of the council’s use of the going concern basis of accounting in the preparation of the financial statements. I also conclude, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Boland TVET College’s ability to continue as a going concern. If I conclude that a material uncertainty exists, I am required to draw attention in my auditor’s report to the related disclosures in the financial statements about the material uncertainty or, if such disclosures are inadequate, to modify the opinion on the financial statements. My conclusions are based on the information available to me at the date of this auditor’s report. However, future events or conditions may cause a college to cease continuing as a going concern

> evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

C O M M U N I C A T I O N W I T H T H O S E C H A R G E D W I T H G O V E R N A N C E

3. I communicate with the council regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that I identify during my audit.

4. I also confirm to the council that I have complied with relevant ethical requirements regarding independence, and communicate all relationships and other matters that may reasonably be thought to have a bearing on my independence and, where applicable, related safeguards.

8

9

N O T E A C T U A L

2018R

2017R

A S S E T S

Current AssetsInventories Receivables from Exchange Transactions Receivables from Non-exchange TransactionsCash and Cash Equivalents

Non-Current AssetsProperty, Plant and Equipment

Total Assets

L I A B I L I T I E S

Current LiabilitiesPayables from Exchange TransactionsUnspent Conditional Grants and ReceiptsDBSA Loans

Non-Current LiabilitiesLong Term Liabilities

Total Liabilities

Total Assets and Liabilities

NET ASSETSAccumulated Surplus

2 345

6

789

9

10

68,323,356699,822

10,187,2809,160,092

48,276,161

232,720,566232,720,566

301,043,921

61,422,64511,443,54349,979,102

-

--

61,422,645

239,621,276

239,621,277239,621,277

36,433,302699,982

20,097,62512,383,341

3,252,354

246,177,642246,177,642

282,610,943

25,937,23411,512,32313,880,720

544,191

333,333333,333

26,270,567

256,340,376

256,340,377256,340,377

Total Net Assets and Liabilities 301,043,921 282,610,943

S T A T E M E N T O F F I N A N C I A L P O S I T I O N

A T 3 1 D E C E M B E R 2 0 1 8

10

N O T E A C T U A L

2018R

2017R

R E V E N U E

Revenue from Non-exchange TransactionsOther Transfers and SponsorshipsGovernment Grants and Subsidies Received Public Contributions and Donations

Revenue from Exchange TransactionsTuition and Related FeesRental of Facilities and EquipmentInterest EarnedSale Of Goods And Rendering of ServicesOther Receipts

Total Revenue

E X P E N D I T U R E

Employee and Related CostsDepreciation and AmortisationExternal Audit FeesImpairment LossesMarketing ExpensesPrinting And StationeryRepairs and MaintenanceFinance CostsBooks and Learning MaterialsOperating Lease ExpenseProgramme ConsumablesMunicipal ServicesStudents Residents MealsProfessional ServicesSecurityTravel And AccommodationTelephone And InternetTraining And Staff DevelopmentGrants and Subsidies PaidGeneral ExpensesLoss on Disposal of Property, Plant and Equipment

Total Expenditure

11 1213

1415161718

192021222324252627282930313233343536373839

312,500138,884,885

617,590

56,252,3347,217,9801,194,280

21,4571,399,091

205,900,117

139,735,0449,484,0272,311,745

952,8112,217,3473,382,9316,085,641

27,2596,230,7694,603,1616,795,481

12,669,8582,964,520

642,1495,465,167

921,1295,731,911

835,159326,792

3,301,8977,934,420

222,619,217

-146,634,205

-

52,656,4605,801,198

399,466184,677

1,371,762

207,047,768

133,755,70410,238,876

1,451,4605,730,6191,428,0513,091,1515,489,433

125,1604,582,7934,872,9726,591,119

11,820,8573,549,760

330,5855,150,553

827,3015,596,975

874,1202,858,9903,669,561

17,514

212,053,554

SURPLUS/(DEFICIT) FOR THE YEAR (16,719,100) (5,005,787)

F O R T H E Y E A R E N D E D 3 1 D E C E M B E R 2 0 1 8

S T A T E M E N T O F F I N A N C I A L P E R F O R M A N C E

11

Details on the movement of the Funds and Reserves are set out in Note 10.

D E S C R I P T I O N

Total forAccumulated

Surplus/(Def icit)Account

Total

R R

2017Balance at 31 December 2016Correction of Error (Note 40)Restated Balance

Surplus/(Deficit) for the yearBalance at 31 December 2017

Restated Balance

Surplus/(Deficit) for the yearBalance at 31 December 2018

255,841,9765,504,188

261,346,164

(5,005,787)256,340,377

256,340,377

(16,719,100)239,621,277

255,841,9765,504,188

261,346,164

(5,005,787)256,340,377

256,340,377

(16,719,100)239,621,277

S T A T E M E N T O F C H A N G E SI N N E T A S S E T S

F O R T H E Y E A R E N D E D 3 1 D E C E M B E R 2 0 1 8

12

N O T E2 0 1 8

R

2 0 1 7R e s t a t e d

R

C A S H F L O W S F R O M O P E R A T I N G A C T I V I T I E S

ReceiptsGovernment Grant and SubsidiesPublic Contributions and DonationsTuition and Related FeesInterest ReceivedSale of Goods and Rendering of ServicesOther Receipts

PaymentsEmployee Related CostsInterest PaidSuppliers PaidOther Payments

N E T C A S H F L O W S F R O M O P E R A T I N G A C T I V I T I E S

C A S H F L O W S F R O M I N V E S T I N G A C T I V I T I E S

Purchase of Property, Plant and EquipmentProceeds on Disposal of Property, Plant and Equipment

N E T C A S H F L O W S F R O M I N V E S T I N G A C T I V I T I E S

C A S H F L O W S F R O M F I N A N C I N G A C T I V I T I E S

Repayment of BorrowingsN E T C A S H F L O W S F R O M F I N A N C I N G A C T I V I T I E S

N E T I N C R E A S E / ( D E C R E A S E ) I N C A S HA N D C A S H E Q U I VA L E N T S

Cash and Cash Equivalents at Beginning of PeriodCash and Cash Equivalents at End of Period

121314161718

19263838

41

66

9

5

90,275,836-

66,318,5741,194,280

21,4578,929,571

(51,377,371)(27,259)

(61,819,138)(4,270,838)

49,245,112

(3,344,781)1,000

(3,343,781)

(877,524)(877,524)

45,023,808

3,252,35448,276,161

61,911,266-

42,138,589399,466184,677

7,172,960

(50,486,049)(125,160)

(59,040,412)(6,859,136)

(4,703,799)

(1,102,577)(6,649)

(1,109,226)

(398,681)(398,681)

(6,211,705)

9,464,0593,252,354

F O R T H E Y E A R E N D E D 3 1 D E C E M B E R 2 0 1 8

C A S H F L O WS T A T E M E N T

13

1 . B A S I S O F P R E S E N T A T I O N

The Annual Financial Statements have been prepared on an Accrual Basis of accounting and are in accordance with the historical cost convention as the basis of measurement, unless specified otherwise.

The Annual Financial Statements have been prepared in accordance with the effective Standards of Generally Recognised Accounting Practices (GRAP) and in the manner prescribed by the Minister of Higher Education and Training in terms of the Continuing Education and Training Act No. 16 of 2006, as amended.

In the absence of an approved and effective standard of GRAP, accounting policies for material transactions, events of conditions were developed in accordance with paragraphs 8, 10 and 11 of GRAP 3 as read with Directive 5.

Assets, liabilities, revenue and expenses were not offset, except where offsetting is either required or permitted by a Standard of GRAP.

1.1 Changes in Accounting Policy and Comparability

Accounting Policies have been consistently applied, except where otherwise indicated below.

For the years ended 31 December 2017 and 31 December 2018 the college has adopted the accounting framework as set out in paragraph 1 above. The details of any resulting changes in Accounting Policy and comparative restatements are set out below and in the relevant Notes to the Annual Financial Statements.

The college changes an Accounting Policy only if the change:

a. Is required by a Standard of GRAP; orb. Results in the Annual Financial Statements providing reliable and more relevant information about the effects of transactions, other events or conditions on the college’s financial position, financial performance or cash flow.

1.2 Critical Judgements, Estimations and Assumptions

In the application of the college’s Accounting Policies, which are described below, management is required

to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

These estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods.

The following are the critical judgements and estimations that management have made in the process of applying the college’s Accounting Policies and that have the most significant effect on the amounts recognised in Annual Financial Statements:

1.2.1 Revenue Recognition

Accounting Policy 7.2 on Revenue from Exchange Transactions and Accounting Policy 7.3 on Revenue from Non-exchange Transactions describes the conditions under which revenue will be recorded by the management of the college.

In making their judgement, the management considered the detailed criteria for the recognition of revenue as set out in GRAP 9 (Revenue from Exchange Transactions) and GRAP 23 (Revenue from Non-exchange Transactions). As far as Revenue from Non- exchange Transactions is concerned (see Basis of Preparation above), and, in particular, whether the college, when goods are sold, had transferred to the buyer the significant risks and rewards of ownership of the goods and when services is rendered, whether the service has been rendered. Also of importance is the estimation process involved in initially measuring revenue at thefair value thereof. Management of the college is satisfied that recognition of the revenue in the current year is appropriate.

A C C O U N T I N G P O L I C I E S T O T H E A N N U A L F I N A N C I A L S T A T E M E N T SF O R T H E Y E A R E N D E D 3 1 D E C E M B E R 2 0 1 8

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1.2.2 Financial Assets and Liabilities

The classification of Financial Assets and Liabilities, into categories, is based on judgement by management.

Accounting Policy 5.1 on Financial Assets Classification and Accounting Policy 5.2 on Financial Liabilities Classification describe the factors and criteria considered by the management of the college in the classification of Financial Assets and Liabilities.

In making the above-mentioned judgement, management considered the definition and recognition criteria for the classification of Financial Instruments as set out in GRAP 104 (Financial Instruments).

1.2.3 Impairment of Financial Assets

Accounting Policy 5.4 on Impairment of Financial Assets describes the process followed to determine the value at which Financial Assets should be impaired. In making the estimation of the impairment, the management of the college considered the detailed criteria of impairment of Financial Assets as set out in GRAP 104 (Financial Instruments) and used its judgement to select a variety of methods and make assumptions that are mainly based on market conditions existing at the end of the reporting period. The management of the college is satisfied that impairment of Financial Assets recorded during the year is appropriate.

Impairment of Trade Receivables:

The College assesses its financial assets for impairment at the end of each financial year. In determining whether an impairment loss should be recorded in surplus or deficit, the College makes judgements as to whether there is observable data indicating a measurable decrease in the estimated future cash flows from a financial asset.

The College has implemented a policy to classify all debts as irrecoverable where they have been outstanding for more than one year (12 months). These amounts are than transferred to a provision for doubtful debts which is adjusted annually. All non recoveries of these amounts impaired are then recognised as bad debts written off in the following year through the statement of financial performance. This practice based on the past patterns of history of payments by students after considering the period the debt has been outstanding for. Attempts at recovery include sending letters of demand and handing debts over to collection agencies as guided in the financial policy of the College.

1.2.4 Useful lives of Property, Plant and Equipment, Intangible Assets and Investment Property

As described in Accounting Policies 3.3, 4.2 and 5.2, the college depreciates its Property, Plant & Equipment and Investment Property, and amortises its Intangible Assets, over the estimated useful lives of the assets, taking into account the residual values of the assets at the end of their useful lives, which is determined when the assets are available for use.

The useful lives of assets are based on management’s estimation. Management considered the impact of technology, availability of capital funding, service requirements and required return on assets in order to determine the optimum useful life expectation, where appropriate.

The estimation of residual values of assets is based on management’s judgement as to whether the assets will be sold or used to the end of their useful lives, and in what condition they will be at that time.

1.2.5 Impairment: Write-down of Property, Plant & Equipment, Intangible Assets, Investment Property, Heritage Assets and Inventories

Accounting Policy 7 on Impairment of Assets, Accounting Policy 4.2 on Intangible Assets – Subsequent Measurement, Amortisation and Impairment and Accounting Policy 6.2 on Inventory – Subsequent Measurement describe the conditions under which non-financial assets are tested for potential impairment losses by the management of the college. Significant estimates and judgements are made relating to impairment testing of Property, Plant and Equipment, impairment testing of Intangible Assets and write-down of Inventories to the lowest of Cost and Current Replacement Cost.

In making the above-mentioned estimates and judgement, management considered the subsequent measurement criteria and indicators of potential impairment losses as set out in GRAP 21 (Impairment of Non-cash Generating Assets) and GRAP 26 (Impairment of Cash Generating Assets). In particular, the calculation of the recoverable service amount for PPE and Intangible Assets and the Current Replacement Cost for Inventories involves significant judgment by management.

Estimated impairments during the year to Property, Plant and Equipment, Intangible Assets, Investment Property, Heritage Assets and Inventory are disclosed in Notes 2 and 6 to the Annual Financial Statements, if applicable.

1.2.6 Provisions and Contingent Liabilities

Management judgement is required when recognising and measuring Provisions and when measuring Contingent Liabilities. Provisions are discounted where the effect of discounting is material using actuarial valuations.

15

1.2.7 DHET Funding

The Department of Higher Education and Training (DHET) annually provides funding to the college for it’s operations. The official title of the funding is Program Funding. Programme funding is allocated to the College by DHET in terms of the CET Act and the National Norms and Standards for Funding of TVET Colleges and is determined by the estimated Full Time Equivalent Students (FTEs) of the College. The allocation is done based on the projected FTEs for the year and if the College fails to register the projected FTEs, a portion of the programme funding can be clawed back in the following year. The programme funding is allocated by DHET during their financial year which is from April to March, but for the College the funds pertain to the College academic and financial year which is from January to December. Once the College has registered the projected number of FTEs, the condition of the programme funding grant has been met and the grant is recognised in full. The programme funding is paid out partly in cash tranches, paid to the College, and partly through the Persal system of the National Education Department, directly to the employees of the College. If management personnel are paid from the programme funding, they should be included in the description. The method and timing of payment of the grant does, however, not influence the recognition of revenue.

In terms of the CET Act and the Funding Norms for TVET Colleges, the Colleges are funded (Programme Funding) based on their Full Time Equivalent (FTE) student numbers. Therefore, in terms of the CET Act and the Funding Norms, a College receives Programme Funding to enrol and train a certain number of students for the year and that Programme Funding accrues to the College in terms of the CET Act and the Funding Norms and the accrual is separate and independent from how the funds are distributed to the College. The full amount of allocated Programme Funding therefore has to be paid to the College by DHET, irrespective of how it is paid. DHET settles its liability for Programme Funding towards the College in part by paying the employment cost of the College employees employed by DHET, via Persal. The remaining liability towards the College is settled in cash.

The Funding norms that is currently applicable to TVET Colleges was Gazetted on 15 May 2015 and paragraph 117 contain provisions which may cause conditions as defined in GRAP 23 to exist under certain circumstances. These conditions would be applicable to the portion of the Programme Funding which is withheld to pay for employee cost of Persal employees deployed at the College. However, DHET has indicated that the intention of the Funding Norms is not to impose conditions which may be introduced by paragraph 117 and that the intention is that the College’s Programme Funding accrues to it in total. Therefore, any difference between the amount withheld for paying Persal salaries and the amount that is eventually used to pay for Persal salaries, is automatically payable to Colleges. DHET has aligned its systems to facilitate the payment of these amounts to Colleges.

Paragraph 103 of the Funding Norms provide for a claw back to be implemented if a College’s enrolment figures were less than that what was planned for and funded in the previous year. The effect of this paragraph is that it introduces a condition as defined in GRAP 23, which is that a portion of the Programme Funding will have to be repaid if a College enrols less than 97% of the planned and funded

enrolment target for the year. However, DHET has indicated that they do not currently have sufficient confidence in the correctness of the enrolment figures to be able to implement this claw back and that the Programme Funding Grant is therefore an unconditional grant at the moment.

The substance over form nature of the Programme Funding for a College is therefore that it accrues to the College, in full and without any conditions, in the financial year of the College during which the enrolment and training of students occurs. The date on which it accrues is 1 January of the relevant year, or the date on which the final grant amount is communicated to the College, whichever is later. The full Programme Funding allocation to the College is therefore recognised as revenue in the College’s financial year.

In terms of the CET Act and DHET Circular 1 of 2015, with effect from 1 April 2015, all non-management personnel of the College, appointed and remunerated through the Department of Education (PERSAL) and the allocation of programme funding, have migrated to DHET and are DHET employees. Non-management personnel not remunerated from provincial allocations or programme funding remain employees of the College as they are appointed by the College.

1.2.8 Campuses or other property used and controlled,

but not owned by the College

Certain campuses and other property are used by the College and are not registered in the name of the College. The lack of legal ownership could affect whether or not the College has control over the campus. Where, inter alia, beneficial control can be illustrated, the campus in question is recognised, measured and included in the financial statements as either property, plant and equipment (campuses or other property) or investment property (other property) in terms of the definition of an asset as per the Framework for the Preparation and Presentation of Financial Statements and the definition of Property, Plant and Equipment in GRAP 17 Property, Plant and Equipment or Investment Property in GRAP 16 Investment Property.

1.2.9 Classification of land and buildings as property,

plant and equipment or investment property

Based on management’s judgement, the following criteria have been applied to distinguish Investment Properties from owner occupied property or property held for resale:

a. Land held for long-term capital appreciation rather than for short-term sale in the ordinary course of operations;

b. Land held for a currently undetermined future use (If the college has not determined that it will use the land as owner-occupied property or for short-term sale in the ordinary course of operations, the land is regarded as held for capital appreciation);

c. A building owned by the college (or held by the college under a finance lease) and leased out under one or more operating leases on a commercial basis (this will include the property portfolio rented out on a commercial basis on behalf of the college);

d. A property owned by the college and leased out at a below market rental; and

e. Property that is being constructed or developed for future use as investment property.

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The rent earned does not have to be at a commercial basis or market related for the property to be classified as investment property.

The following assets do not fall in the ambit of Investment Property and shall be classified as Property, Plant and Equipment, Inventory or Non-current Assets Held-for-Sale, as appropriate:

a. Property held for sale in the ordinary course of operations or in the process of construction or development for such sale;

b. Property being constructed or developed on behalf of third parties;

c. Owner-occupied property, including (among other things) property held for future use as owner-occupied property, property held for future development and subsequent use as owner-occupied property, property occupied by employees such as housing for personnel (whether or not the employees pay rent at market rates) and owner-occupied property awaiting disposal;

d. Property that is leased to another entity under a finance lease;

e. Property held to provide goods and services and also generates cash inflows; and

f. Property held for strategic purposes which would be accounted for in accordance with the Standard of GRAP on Property, Plant and Equipment.

Based on an evaluation of the above, the college does not hold investment property.

1.3 Presentation Currency

The Annual Financial Statements are presented in South African Rand, rounded off to the nearest Rand which is the college’s functional currency.

1.4 Going Concern Assumption

Management and council have made the assessment that the entity is a going concern and the financial statements have been prepared on a going concern basis.

1.5 Offsetting

Assets, Liabilities, Revenues and Expenses have not been offset except when offsetting is required or permitted by a Standard of GRAP.

1.6 Standards, Amendments to Standards and Interpretations issued but not yet Effective

The college applied the principles established in the following Standards of GRAP that have been issued but are not yet effective, in developing appropriate Accounting Policies dealing with the following

transactions, but have not early adopted these Standards:

Where a standard of GRAP is approved as effective, it replaces the equivalent statement of International Public Sector Accounting Standards Board, International Financial Reporting Standards or Generally Accepted Accounting Principles. Where a standard of GRAP has been issued but is not yet in effect, the college may select to apply the principles established in that standard in developing an appropriate Accounting Policy dealing with a particular section or event before applying paragraph 12 of the Standard of GRAP on Accounting Policies, Changes in Accounting Estimates and Errors.

GRAP 20 Related Party Disclosures (Revised)GRAP 32 Service Concession Arrangement

Grantor issued August 2013GRAP 34 Separate Financial Statements*GRAP 35 Consolidated Financial Statements*GRAP 36 Investments in associates and joint

ventures*GRAP 37 Joint arrangements*GRAP 38 Disclosure of interest in other entitiesGRAP 108 Statutory Receivables - issued

September 2013GRAP 109 Accounting by Principals and Agents -

issued July 2015GRAP 110 Living and non-living resources

*These standards may not be applicable to the college but are included for completeness of information in capacitating the college with information.

The ASB Directive 5, paragraph 29, sets out the principles for the application of the GRAP 3 guidelines in the determination of the GRAP Reporting Framework hierarchy as set out in the standard of GRAP 3 on Accounting Policies, Changes in Accounting Estimates

and Errors.

Management has considered all of the above-mentioned GRAP Standards issued but not yet effective and anticipates that the adoption of these standards will not have a significant impact on the financial position, financial performance or cash flows of the college.

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2 . N E T A S S E T S

Included in the Net Assets of the college are the following Reserves that are maintained in terms of specific requirements:

2.1 Accumulated Surplus

Accumulated surplus comprise of rolled over funds from the current and prior years based on the recorded surplus or deficit for the period. The reserve is not cash backed.

3 . P R O P E R T Y, P L A N T A N D E Q U I P M E N T

3.1 Initial Recognition

Property, Plant and Equipment are tangible non-current assets (including infrastructure assets) that are held for use in the production or supply of goods or services, rental to others, or for administrative purposes, and are expected to be used during more than one year.

The cost of an item of Property, Plant and Equipment is recognised as an asset if, and only if, it is probable that future economic benefits or service potential associated with the item will flow to the college, and if the cost or fair value of the item can be measured reliably.

Property, Plant and Equipment are initially recognised at cost on its acquisition date or in the case of assets acquired by grants or donations, deemed cost, being the fair value of the asset on initial recognition. The cost of an item of Property, Plant and Equipment is the purchase price and other costs attributable to bring the asset to the location and condition necessary for it to be capable of operating in the manner intended by the college. Trade discounts and rebates are deducted in arriving at the cost. The cost also includes the necessary costs of dismantling and removing the asset and restoring the site on which it is located.

When significant components of an item of Property, Plant and Equipment have different useful lives, they are accounted for as separate items (major components) of Property, Plant and Equipment.

Where an asset is acquired by the college for no or nominal consideration (i.e. a non-exchange transaction), the cost is deemed to be equal to the fair value of that asset on the date acquired.

The cost of an item of Property, Plant and Equipment acquired in exchange for non-monetary assets or monetary assets, or a combination of monetary and non-monetary assets is measured at the fair value of the asset given up, unless the fair value of the asset received is more clearly evident. If the acquired item could not be measured at its fair value, its cost is measured at the carrying amount of the asset given up.

Major spare parts and servicing equipment qualify as Property, Plant and Equipment when the college expects to use them during more than one period. Similarly, if the major spare parts and servicing equipment can be used only in connection with an item of Property, Plant and Equipment, they are accounted for as Property, Plant and Equipment.

3.2 Subsequent Measurement

Subsequent expenditure relating to Property, Plant and Equipment is capitalised if it is probable that future economic benefits or potential service delivery associated with the subsequent expenditure will flow to the college and the cost or fair value of the subsequent expenditure can be reliably measured. Subsequent expenditure incurred on an asset is only capitalised when it increases the capacity or future economic benefits associated with the asset. Where the college replaces parts of an asset, it derecognises the part of the asset being replaced and capitalises the new component.

Subsequently all Property Plant and Equipment are measured at cost, less accumulated depreciation and accumulated impairment losses.

Compensation from third parties for items of Property, Plant and Equipment that were impaired, lost or given up is included in the Statement of Financial Performance when the compensation becomes receivable.

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The assets’ residual values, estimated useful lives and depreciation method are reviewed annually and adjusted prospectively, if appropriate, at each reporting date. Reviewing the useful life of an asset on an annual basis does not require the college to amend the previous estimate unless expectations differ from the previous estimate.

3.4 Land

Land is stated at historical cost and is not depreciated as it is deemed to have an indefinite useful life.

3.5 Incomplete Construction Work

Incomplete Construction Work is stated at historical cost. Depreciation only commences when the asset is available for use.

3.6 Derecognition

The carrying amount of an item of Property, Plant and Equipment is derecognised on disposal, or when no future economic benefits or service potential are expected from its use or disposal.

The gain or loss arising from the derecognition of an item of Property, Plant and Equipment is included in surplus or deficit when the item is derecognised. Gains are not classified as revenue.

Gains or losses are calculated as the difference between the carrying value of assets (cost less accumulated depreciation and accumulated impairment losses) and the proceeds from disposals are included in the Statement of Financial Performance as a gain or loss on disposal of Property, Plant and Equipment.

3.3 Depreciation

Depreciation on assets other than land is calculated on cost, using the Straight-line Method, to allocate their cost or revalued amounts to their residual values over the estimated useful lives of the assets. The depreciation method used reflects the pattern in which the asset’s future economic benefits or service potential are expected to be consumed by the college. Each part of an item of Property, Plant and Equipment with a cost

4 . I M PA I R M E N T O F A S S E T S

The college classifies all assets held with the primary objective of generating a commercial return as Cash Generating Assets.

4.1 Impairment of Cash Generating Assets

The college assesses at each reporting date whether there is any indication that an asset may be impaired.

If there is any indication that an asset may be impaired, the recoverable amount is estimated for the individual asset. If it is not possible to estimate the recoverable amount of the individual asset, the recoverable amount of the cash generating unit to which the asset belongs is determined.

The recoverable amount of an asset or a cash generating unit is the higher of its fair value less costs to sell and its value in use. The best evidence of fair value less cost to sell is the price in a binding sale agreement in an arm’s length transaction, adjusted for the incremental cost that would be directly attributable to the disposal of the asset.

Value in use of a cash-generating asset is the present value of the estimated future cash flows expected to be derived from the continuing use of an asset and from its disposal at the end of its useful life.

If the recoverable amount of an asset is less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. That reduction is an impairment loss.

An impairment loss of assets carried at cost less any accumulated depreciation or amortisation is recognised immediately in the Statement of Financial Performance.

that is significant in relation to the total cost of the item is depreciated separately.

Depreciation only commences when the asset is available for use, unless stated otherwise. The depreciation rates are based on the following estimated useful lives:

A S S E T C L A S S Y E A R S A S S E T C L A S S Y E A R S

LandImproved Property

BuildingsImprovements

Indefinite

50

OtherComputer EquipmentFurniture and FittingsMotor VehiclesWorkshop Equipment

2-41-65

4-5

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An impairment loss is recognised for cash generating units if the recoverable amount of the unit is less than the carrying amount of the unit. The impairment loss is allocated to reduce the carrying amount of the assets of the unit pro rata on the basis of the carrying amount of each asset in the unit.

The college assesses at each reporting date whether there is any indication that an impairment loss recognised in prior periods for assets may no longer exist or may have decreased. If any such indication exists, the recoverable amounts of those assets are estimated.

The increased carrying amount of an asset attributable to a reversal of an impairment loss does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in prior periods.

A reversal of an impairment loss of assets carried at cost less accumulated depreciation or amortisation is recognised immediately in the Statement of Financial Performance.

4.2 Impairment of Non-cash Generating Assets

The college assesses at each reporting date whether there is any indication that an asset may be impaired.

If there is any indication that an asset may be impaired, the recoverable service amount is estimated for the individual asset. If it is not possible to estimate the recoverable service amount of the individual asset, the recoverable service amount of the non-cash generating unit to which the asset belongs is determined.

The recoverable service amount of a non-cash generating asset is the higher of its fair value less costs to sell and its value in use. The value in use for a non-cash generating asset is the present value of the asset’s remaining service potential.

Fair value less costs to sell is the amount obtainable from the sale of an asset in an arm’s length transaction between knowledgeable, willing parties, less the costs of disposal.

If the recoverable service amount of an asset is less than its carrying amount, the carrying amount of the asset is reduced to its recoverable service amount. That reduction is an impairment loss.

An impairment loss of assets carried at cost less any accumulated depreciation or amortisation is recognised immediately in the Statement of Financial Performance.

An impairment loss is recognised for non-cash generating units if the recoverable service amount of the unit is less than the carrying amount of the unit.

The impairment loss is allocated to reduce the carrying amount of the assets of the unit pro rata on the basis of the carrying amount of each asset in the unit.

The college assesses at each reporting date whether there is any indication that an impairment loss recognised in prior periods for assets may no longer exist or may have decreased. If any such indication exists, the recoverable service amounts of those assets are estimated.

The increased carrying amount of an asset attributable to a reversal of an impairment loss does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in prior periods.

A reversal of an impairment loss of assets carried at cost less accumulated depreciation or amortisation is recognised immediately in the Statement of Financial Performance.

5 . F I N A N C I A L I N S T R U M E N T S

The college has various types of Financial Instruments and these can be broadly categorised as Financial Assets, Financial Liabilities or Residual Interests in accordance with the substance of the contractual agreement. The college only recognises a Financial Instrument when it becomes a party to the contractual provisions of the instrument.

Initial Recognition

Financial Assets and Financial Liabilities are recognised on the college’s Statement of Financial Position when it becomes party to the contractual provisions of the instrument.

The college does not offset a Financial Asset and a Financial Liability unless a legally enforceable right to set off the recognised amounts currently exist and the college intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

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Fair Value Methods and Assumptions

The fair values of Financial Instruments are determined as follows:

> The fair values of quoted investments are based on current bid prices.

> If the market for a Financial Asset is not active (and for unlisted securities), the college establishes fair value by using valuation techniques. These include the use of recent arm’s length transactions, reference to other instruments that are substantially the same, discounted cash flow analysis, and option pricing models making maximum use of market inputs and relying as little as possible on entity-specific inputs.

The Effective Interest Rate Method

The Effective Interest Method is a method of calculating the amortised cost of a Financial Asset or a Financial Liability and of allocating the interest income or interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the Financial Instrument or, when appropriate, a shorter period to the net carrying amount of the Financial Asset or Financial Liability.

Amortised Cost

Amortised Cost is the amount at which the Financial Asset or Financial Liability is measured at initial recognition

Cash includes cash-on-hand (including petty cash) and cash with banks (including call deposits). Cash Equivalents are short-term highly liquid investments, readily convertible into known amounts of cash, which are held with registered banking institutions with maturities of three months or less and are subject to an insignificant risk of change in value. For the purposes of the Cash Flow Statement, Cash and Cash Equivalents comprise cash-on-hand and deposits held on call with banks, net of bank overdrafts. The college categorises Cash and Cash Equivalents as Financial Assets at Fair Value.

minus principal repayments, plus or minus the cumulative amortisation, using the Effective Interest Rate Method of any difference between that initial amount and the maturity amount, and minus any reduction for impairment or collectability.

5.1 Financial Assets – Classification

A Financial Asset is any asset that is a cash, a contractual right to receive cash or another financial asset from another entity.

In accordance with GRAP 104 the Financial Assets of the college are classified as follows into the three categories allowed by this standard:

> Financial Assets measured at Amortised Cost are non-derivative Financial Assets with fixed or determinable payments that are not quoted in an active market. They are included in Current Assets, except for maturities greater than 12 months, which are classified as Non-current Assets. Financial Assets at Amortised Cost are initially recognised at fair value plus transaction costs that are directly attributable to the acquisition or issue of the Financial Asset. After initial recognition, Financial Assets are measured at amortised cost, using the Effective Interest Rate Method less a provision for impairment.

The college has the following types of Financial Assets as reflected on the face of the Statement of Financial Position or in the Notes thereto:

5.2 Financial Liabilities – Classification

A Financial Liability is a contractual obligation to deliver cash or another Financial Assets to another entity.The college has the following types of Financial Liabilities as reflected on the face of the Statement of Financial Position or in the notes thereto:

T Y P E O F F I N A N C I A L A S S E T C L A S S I F I C A T I O N I N T E R M S O F G R A P 1 0 4

Long-term ReceivablesReceivables from Exchange TransactionsReceivables from Non-exchange TransactionsBank, Cash and Cash Equivalents – Notice DepositsBank, Cash and Cash Equivalents – Call DepositsBank, Cash and Cash Equivalents – BankBank, Cash and Cash Equivalents – CashCurrent Portion of Long-term Receivables

Financial Assets at Amortised CostFinancial Assets at Amortised CostFinancial Assets at Amortised CostFair ValueFair ValueFair ValueFair ValueFinancial Assets at Amortised Cost

T Y P E O F F I N A N C I A L L I A B I L I T I E S C L A S S I F I C A T I O N I N T E R M S O F G R A P 1 0 4

Payables from Exchange TransactionsPayables from Non-exchange TransactionsUnspent Conditional Grants

Financial Liabilities at Amortised CostFinancial Liabilities at Amortised CostFinancial Liabilities at Amortised Cost

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5.3 Initial and Subsequent Measurement

5.3.1 Financial Assets:

Financial Assets measured at Amortised Cost

Financial Assets at Amortised Cost are initially measured at fair value plus transaction costs that are directly attributable to the acquisition or issue of the Financial Asset. Subsequently, these assets are measured at amortised cost using the Effective Interest Method less any impairment, with interest recognised on an Effective Yield Basis .

Trade and Other Receivables (excluding Value Added Taxation, Prepayments and Operating Lease receivables), Loans to College Entities and Loans that have fixed and determinable payments that are not quoted in an active market are classified as Financial Assets at Amortised Cost.

5.3.2 Financial Liabilities:

Financial Liabilities held at Amortised Cost

Any other Financial Liabilities are classified as Other Financial Liabilities (All Payables, Loans and Borrowings are classified as Other Liabilities) and are initially measured at fair value, net of transaction costs. Trade and Other Payables, Interest-bearing Debt including Finance Lease Liabilities, Non-interest-bearing Debt and Bank Borrowings are subsequently measured at amortised cost using the Effective Interest Rate Method. Interest expense is recognised in the Statement of Financial Performance by applying the effective interest rate.

Prepayments are carried at cost less any accumulated impairment losses.

5.4 Impairment of Financial Assets

Financial Assets are assessed for indicators of impairment at the end of each reporting period. Financial Assets are impaired where there is objective evidence of impairment of Financial Assets (such as the probability of insolvency or significant financial difficulties of the debtor). If there is such evidence the recoverable amount is estimated and an impairment loss is recognised in accordance with GRAP 104.

5.4.1 Financial Assets at Amortised Cost

Accounts Receivable encompass Long-term Debtors, Receivables from Exchange Transactions (Tuition Fee Debtors) and Receivables from Non-exchange Transactions (Other Debtors).

Initially Accounts Receivable are valued at fair value excluding transaction costs, and subsequently carried at amortised cost using the Effective Interest Rate Method.

An estimate is made for doubtful debt based on past default experience of all outstanding amounts at year-end. Bad debts are written off the year in which they are identified as irrecoverable. Amounts receivable within 12 months from the date of reporting are classified as current.

A provision for impairment of Accounts Receivables is established when there is objective evidence that the college will not be able to collect all amounts due according to the original terms of receivables. The provision is made in accordance with GRAP 104 whereby the recoverability of accounts receivable is assessed individually and then collectively after grouping the assets in financial assets with similar credit risk characteristics. The amount of the provision is the difference between the Financial Asset’s carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. Future cash flows in a group of Financial Assets that are collectively evaluated for impairment are estimated on the basis of historical loss experience for assets with credit risk characteristics similar to those in the group. Cash flows relating to short-term receivables are not discounted where the effect of discounting is immaterial.

The carrying amount of the Financial Asset is reduced by the impairment loss directly for all Financial Assets carried at Amortised Cost with the exception of Tuition Fee Debtors, where the carrying amount is reduced through the use of an allowance account. When a Tuition Fee Debtors is considered uncollectible, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against revenue. Changes in the carrying amount of the allowance account are recognised in the Statement of Financial Performance.

5.5 Derecognition of Financial Assets

The college derecognises Financial Assets only when the contractual rights to the cash flows from the asset expires or it transfers the Financial Asset and substantially all the risks and rewards of ownership of the asset to another entity, except when Council approves the write-off of Financial Assets due to non-recoverability.

If the college neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the college recognises its retained interest in the asset and an associated liability for amounts it may have to pay. If the college retains substantially all the risks and rewards of ownership of a transferred Financial Asset, the college continues to recognise the Financial Asset and also recognises a collateralised borrowing for the proceeds received.

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5.6 Derecognition of Financial Liabilities

The college derecognises Financial Liabilities when, and only when, the college’s obligations are discharged, cancelled or they expire.

The college recognises the difference between the carrying amount of the Financial Liability (or part of a Financial Liability) extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, in the Statement of Financial Performance.

6 . I N V E N T O R I E S

6.1 Initial Recognition

Inventories comprise current assets for consumption or distribution during the ordinary course of business. Inventories are initially recognised at cost. Cost generally refers to the purchase price, plus taxes, transport costs and any other costs in bringing the Inventories to their current location and condition.

Where Inventory is acquired by the college for no or nominal consideration (i.e. a non-exchange transaction), the cost is deemed to be equal to the fair value of the item on the date acquired.

6.2 Subsequent Measurement

6.2.1 Consumable Stores and Finished Goods

Consumable stores inventories distributed at no charge or for a nominal charge and finished goods are valued at the lower of cost and current replacement costs (net amount that the college expects to realise from the sale on Inventory in the ordinary course of business). The cost of inventory is assigned by using the first-in, first out (FIFO) cost formula.

6.2.2 Other Arrangements

Redundant and slow-moving Inventories are identified and written down from cost to replacement cost with regard to their estimated economic or replacement cost. Replacement cost is the current cost to replace the item at year end. Differences arising on the measurement of such Inventory at the lower of cost and replacement cost are recognised in the Statement of Financial Performance in the year in which they arise. The amount of any reversal of any write-down of Inventories arising from an increase in current replacement cost is recognised as a reduction in the amount of Inventories recognised as an expense in the period in which the reversal occurs.

The carrying amount of Inventories is recognised as an expense in the period that the Inventory was distributed, written off or consumed, unless that cost qualifies for capitalisation to the cost of another asset.

7 . R E V E N U E R E C O G N I T I O N

7.1 General

Revenue is derived from a variety of sources which include tuition fees, grants from other tiers of government and revenue from trading activities and other services provided.

The college recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits or service potential will flow to the college and when specific criteria have been met for each of the college’s activities as described below, except when specifically stated otherwise. The amount of revenue is not considered to be reliably measurable until all contingencies relating to the sale have been resolved. The college bases its estimates on historical results, taking into consideration the type of customer, the type of transaction and the specifics of each arrangement. Furthermore, services rendered are recognised by reference to the stage of completion of the transaction at the reporting date.

Revenue from Exchange Transactions refers to revenue that accrued to the college directly in return for services rendered / goods sold, the value of which approximates the consideration received or receivable. Revenue is measured at the fair value of the consideration received or receivable.

Revenue from Non-exchange Transactions refers to transactions where the college received revenue from another entity without directly giving approximately equal value in exchange. Revenue from non-exchange transactions is generally recognised to the extent that the related receipt or receivable qualifies for recognition as an asset and there is no liability to repay the amount.

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7.2 Revenue from Exchange Transactions

7.2.1 Rentals Received

Revenue from the rental of facilities and equipment is recognised on a Straight-line Basis over the term of the lease agreement.

7.2.2 Interest Earned

Interest earned on investments is recognised in the Statement of Financial Performance on the Time-proportionate Basis that takes into account the effective yield on the investment.

7.2.3 Sale of Goods

Revenue from the sale of goods is recognised when all the following conditions have been met:a. The college has transferred to the buyer the significant

risks and rewards of ownership of the goods;b. The college retains neither continuing managerial

involvement to the degree usually associated with ownership nor effective control over the goods sold;

c. The amount of revenue can be measured reliably;d. It is probable that the economic benefits or service

potential associated with the transaction will flow to the college; and

e. The costs incurred or to be incurred in respect of the transaction can be measured reliably.

Tuition fees are recognised over the period of instruction.

7.2.4 Services Rendered

When the outcome of a transaction involving the rendering of services can be estimated reliably, revenue associated with the transaction is recognised by reference to the stage of completion of the transaction at the reporting date. The outcome of a transaction can be estimated reliably when all the following conditions are satisfied:

> the amount of revenue can be measured reliably;> it is probable that the economic benefits or service

potential associated with the transaction will flow to the College;

> the stage of completion of the transaction at the reporting date can be measured reliably; and

> the costs incurred for the transaction and the costs to complete the transaction can be measured reliably.

When services are performed by an indeterminate number of acts over a specified time frame, revenue is recognised on a straight line basis over the specified time frame unless there is evidence that some other method better represents the stage of completion. When a specific act is much more significant than any other acts, the recognition of revenue is postponed until the significant act is executed.

7.3 Revenue from Non-exchange Transactions

An inflow of resources from a Non-exchange Transaction, that meets the definition of an asset shall be recognised as an asset when it is probable that the future economic benefits or service potential associated with the asset will flow to the college and the fair value of the asset can be measured reliably. The asset shall be recognised as revenue, except to the extent that a liability is also recognised in respect of the same inflow.

A present obligation arising from a Non-exchange Transaction that meets the definition of a liability will be recognised as a liability when it is probable that an outflow of economic benefit will be required to settle the obligation and a reliable estimate of the amount can be made.

7.3.1 Public Contributions

Donations and funding are recognised as revenue to the extent that the college has complied with any of the criteria, conditions or obligations embodied in the agreement. Where the agreement contains a stipulation to return the asset, other future economic benefits or service potential, in the event of non-compliance to these stipulations and would be enforced by the transferor, a liability is recognised to the extent that the criteria, conditions or obligations have not been met. Where such requirements are not enforceable, or where past experience has indicated that the transferor has never enforced the requirement to return the transferred asset, other future economic benefits or service potential when breaches have occurred, the stipulation will be considered a restriction and is recognised as revenue.

Revenue from public contributions is recognised when all conditions associated with the contribution have been met or where the contribution is to finance property, plant and equipment, when such items of property, plant and equipment are brought into use.

Assets acquired from non-exchange transactions are measured at fair value in accordance with the Standards of GRAP.

24

7.3.2 Government Grants and Receipts

Conditional grants, donations and funding are recognised as revenue to the extent that the college has complied with any of the criteria, conditions or obligations embodied in the agreement. Where the agreement contains a stipulation to return the asset, other future economic benefits or service potential, in the event of non-compliance to these stipulations and would be enforced by the transferor, a liability is recognised to the extent that the criteria, conditions or obligations have not been met. Where such requirements are not enforceable, or where past experience has indicated that the transferor has never enforced the requirement to return the transferred asset, other future economic benefits or service potential when breaches have occurred, the stipulation will be considered a restriction and is recognised as revenue.

The full programme funding allocated to the College in terms of the CET Act, the Funding Norms and the final grant letter received from the department is recognised in full in the College’s financial year during which the enrolment and training of students, to which the grant pertains, are performed by the College. It is measured at the total amount allocated to the College by DHET, inclusive of both the part paid in cash and the part paid via Persal as per Note 12.

Government grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the college with no future related costs, are recognised in the Statement of Financial Performance in the period in which they become receivable.

Interest earned on investments is treated in accordance with grant conditions. If it is payable to the funder it is recorded as part of the creditor and if it is the college’s interest, it is recognised as interest earned in the Statement of Financial Performance.

Revenue is recognised when all conditions associated with the contribution have been met or where the contribution is to finance property, plant and equipment, when such items of property, plant and equipment are brought into use.

7.3.3 Services in-kind

The College recognises services in-kind that are significant to its operations and/or service delivery objectives as assets and recognise the related revenue when it is probable that the future economic benefits or service potential will flow to the entity and the fair value of the assets can be measured reliably. If the services in-kind are not significant to the College’s operations and/or service delivery objectives and/or do not satisfy the criteria for recognition, the nature and type of services in-kind received during the reporting period is disclosed.

8. PROVISIONS

Provisions are recognised when the college has a present or constructive obligation as a result of past events, it is probable that an outflow of resources embodying economic benefits or service potential will be required to settle the obligation and a reliable estimate can be made of the obligation.

The best estimate of the expenditure required to settle the present obligation is the amount that the college would rationally pay to settle the obligation at the reporting date or to transfer it to a third party at that time and are determined by the judgment of the management of the college, supplemented by experience of similar transactions and, in some cases, reports from independent experts. The evidence considered includes any additional evidence provided by events after the reporting date. Uncertainties surrounding the amount to be recognised as a provision are dealt with by various means according to the circumstances. Where the provision being measured involves a large population of items, the obligation is estimated by weighting all possible outcomes by their associated probabilities.

Future events that may affect the amount required to settle an obligation are reflected in the amount of a provision where there is sufficient objective evidence that they will occur. Gains from the expected disposal of assets are not taken into account in measuring a provision. Provisions are not recognised for future operating losses. The present obligation under an onerous contract is recognised and measured as a provision. An onerous contract is a contract in which the unavoidable costs of meeting the obligations under the contract exceed the economic benefits expected to be received under it. The unavoidable costs under a contract reflect the least net cost of exiting from the contract, which is the lower of the cost of fulfilling it and any compensation or penalties arising from failure to fulfil it – this unavoidable cost resulting from the contract is the amount of the provision to be recognised.

Provisions are reviewed at reporting date and the amount of a provision is the present value of the expenditure expected to be required to settle the obligation. When the effect of discounting is material, provisions are determined by discounting the expected future cash flows that reflect current market assessments of the time value of money. The impact of the periodic unwinding of the discount is recognised in the Statement of Financial Performance as a finance cost as it occurs.

9 . E M P L O Y E E B E N E F I T L I A B I L I T I E S

9.1 Short-term Employee Benefits

Remuneration to employees is recognised in the Statement of Financial Performance as the services are rendered, except for non- accumulating benefits which are only recognised when the specific event occurs.

The college has opted to treat its provision for leave pay as an accrual.

The costs of all short-term employee benefits such as leave pay, are recognised during the period in which the employee renders the related service. The liability for leave pay is based on the total accrued leave days at year end and is shown as a creditor in the Statement of Financial Position. The college recognises the expected cost of performance bonuses only when the college has a present legal or constructive obligation to make such payment and a reliable estimate can be made.

25

9.1.1 Defined Contribution Plans

A Defined Contribution Plan is a plan under which the college pays fixed contributions into a separate entity. The college has no legal or constructive obligation to pay further contributions if the fund does not hold sufficient assets to pay all employees the benefits relating to service in the current or prior periods.

The college’s contributions to the defined contribution funds are established in terms of the rules governing those plans. Contributions are recognised in the Statement of Financial Performance in the period in which the service is rendered by the relevant employees. The college has no further payment obligations once the contributions have been paid. The contributions are recognised as employee benefit expense when they are due. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in the future payments is available.

1 0 . L E A S E S

10.1 Classification

Leases are classified as Finance Leases where substantially all the risks and rewards associated with ownership of an asset are transferred to the college.

Leases of property, plant and equipment, in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as Operating Leases.

Rental revenue from Operating Leases is recognised on an ad-hoc Basis since lease agreements are either not in place or not enforced.

1 1 . U N A U T H O R I S E D E X P E N D I T U R E

Unauthorised expenditure means the overspending of an approved budget without the necessary approvals per the delegated limits, or expenditure incurred not in accordance with the purpose of a cost centre.

All expenditure relating to unauthorised expenditure is recognised as an expense in the statement of financial performance in the year that the expenditure was incurred. The expenditure is classified in accordance with the nature of the expense, and where recovered, it is subsequently accounted for as revenue in the statement of financial performance.

If expenditure is classified as satisfying the criteria for 2 or more of the following: Unauthorised, irregular or fruitless and wasteful, it is only reported under one of the headings in the following descending order: Unauthorised expenditure; Irregular expenditure and

then Fruitless and wasteful expenditure.

1 2 . I R R E G U L A R E X P E N D I T U R E

Irregular expenditure is expenditure that is contrary to the CET Act or any applicable legislation, or any regulations made in terms of the CET Act, or is in contravention of the College’s Supply Chain Management Policy, or any other College policy. Irregular expenditure excludes unauthorized expenditure. Irregular expenditure is accounted for as an expense, classified in accordance with the nature of the expense, and where recovered, it is subsequently accounted for as revenue in the statement of financial performance.

1 3 . F R U I T L E S S A N D WA S T E F U L E X P E N D I T U R E

Fruitless and Wasteful Expenditure is expenditure that was made in vain and would have been avoided had reasonable care been exercised. All expenditure relating to Fruitless and wasteful expenditure is accounted for as expenditure in the Statement of Financial Performance in the year that the expenditure was incurred. The expenditure is classified in accordance with the nature of the expense, and where recovered, it is subsequently accounted for as revenue in the Statement of Financial Performance.

1 4 . C H A N G E S I N A C C O U N T I N G P O L I C I E S , E S T I M A T E S A N D E R R O R S

Changes in Accounting Policies that are affected by management have been applied retrospectively in accordance with GRAP 3 requirements, except to the extent that it is impractical to determine the period-specific effects or the cumulative effect of the change in policy. In such cases the college restated the opening balances of assets, liabilities and net assets for the earliest period for which retrospective restatement is practical. Details of Changes in Accounting Policies are disclosed in the Notes to the Annual Financial Statements where applicable.

26

Changes in Accounting Estimates are applied prospectively in accordance with GRAP 3 requirements. Details of changes in estimates are disclosed in the Notes to the Annual Financial Statements where applicable.Correction of Errors is applied retrospectively in the period in which the error has occurred in accordance with GRAP 3 requirements, except to the extent that it is impractical to determine the period-specific effects or the cumulative effect of the error. In such cases the college shall restate the opening balances of assets, liabilities and net assets for the earliest period for which retrospective restatement is practical. Details of Correction of Errors are disclosed in the Notes to the Annual Financial Statements where applicable.

1 5 . T R E A T M E N T O F A D M I N I S T R A T I O N A N D O T H E R O V E R H E A D E X P E N S E S

The costs of internal support services are transferred to the various services and departments to whom resources are made available.

1 6 . C O N T I N G E N T A S S E T S A N D C O N T I N G E N T L I A B I L I T I E S

Contingent Liabilities represent a possible obligation that arises from past events and whose existence will be confirmed only by an occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the college. A contingent liability can also arise as a result of a present obligation that arises from past events but which is not recognised as a liability either because it is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation or the amount of the obligation cannot be measured with sufficient reliability.

Contingent Assets represent possible assets that arise from past events and whose existence will be confirmed only by an occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the college.

Contingent Assets and Contingent Liabilities are not recognised. Contingencies are disclosed in Notes to the Annual Financial Statements.

1 7 . C O M M I T M E N T S

Commitments are future expenditure to which the college committed and that will result in the outflow of resources. Commitments are not recognised in the Statement of Financial Position as a liability or as

expenditure in the Statement of Financial Performance, but are included in the disclosure Notes. A distinction is made between capital and current commitments.

Commitments are disclosed for:

> Approved and contracted commitments, where the expenditure has been approved and the contract has been awarded at the reporting date, where disclosure is required by a specific standard of GRAP.

> Approved but not yet contracted commitments, where the expenditure has been approved and the contract has yet to be awarded or is awaiting finalisation at the reporting date.

> Items are classified as commitments where the college commits itself to future transactions that will normally result in the outflow of resources.

> Contracts that are entered into before the reporting date, but goods and services have not yet been received are disclosed in the disclosure Notes to the Annual Financial Statements.

> Other commitments for contracts that are non- cancellable or only cancellable at significant cost, should relate to something other than the business of the college.

1 8 . R E L A T E D PA R T I E S

Individuals as well as their close family members, and/or entities are related parties if one party has the ability, directly or indirectly, to control or jointly control the other party or exercise significant influence over the other party in making financial and/or operating decisions. Management is regarded as a related party and comprises the Councillors, Principal, Deputy Principals and Chief Financial Officer.

1 9 . E V E N T S A F T E R T H E R E P O R T I N G DA T EEvents after the reporting date that are classified as adjusting events have been accounted for in the Annual Financial Statements. The events after the reporting date that are classified as Non-adjusting Events after the Reporting Date have been disclosed in Notes to the Annual Financial Statements.

2 0 . C O M PA R A T I V E I N F O R M A T I O N

When the presentation or classification of items in the Annual Financial Statements is amended, prior period comparative amounts are reclassified. The nature and reason for the reclassification is disclosed.

27

1 . G E N E R A L I N F O R M A T I O N

Boland TVET College is a Public Continuing Education and Training College, established under the Continuing Education and Training Act No 16 of 2006, in Stellenbosch, Western Cape Province. The addresses of its registered office and principal place of business are disclosed under

A concerted effort to minimise stock at year end was made by minimizing the ordering of stock in the last quarter. The carrying amount of inventory is recognised as an expense in the period that the inventory was distributed, written off or consumed.

The college did not pledge any of its receivables as security for borrowing purposes.

2 . I N V E N T O R I E S

2018R

2017R

Consumable StoresTotal Inventories

Consumable stores include:Text booksStationery/ink cartridgesCleaning and kitchen stock

699,822699,822

699,822--

699,982699,982

645,26918,78635,927

699,822 699,982

3 . R E C E I VA B L E S F R O M E X C H A N G E T R A N S A C T I O N S

Gross BalancesR

Provision for ImpairmentR

Net BalancesR

A S A T 3 1 D E C E M B E R 2 0 1 8Student DebtorsStaff DebtorsProvincial GovernmentNational GovernmentPrepaid ExpensesSundry DebtorsMunicipal DepositsOther ReceivablesTotal Receivables from Exchange Transactions

A S A T 3 1 D E C E M B E R 2 0 1 7Student DebtorsStaff DebtorsProvincial GovernmentNational GovernmentPrepaid ExpensesSundry DebtorsMunicipal DepositsOther Receivables

Total Receivables from Exchange Transactions

7,069,976390,192158,250

1,880,363163,472

1,792,17921,45175,756

11,551,639

15,275,805312,265

2,576,0952,422,694

260,8371,258,502

69,260-

22,175,458

823,998241,751

72,80047,992

-177,819

--

1,364,359

926,269-

102,000947,881

-101,683

--

2,077,833

6,245,978148,442

85,4501,832,371

163,4721,614,360

21,45175,756

10,187,280

14,349,536312,265

2,474,0951,474,813

260,8371,156,818

69,260-

20,097,625

N O T E S T O T H E F I N A N C I A L S T A T E M E N T S

F O R T H E Y E A R E N D E D 3 1 D E C E M B E R 2 0 1 8

“General Information” included in the Annual Financial Statements and in the introduction of the Annual Report. The principal activities of the college are disclosed in the Annual Report and are prescribed by the Continuing Education and Training Act.

Boland College treat textbooks as inventory which is “sold” when distributed to students as part of the all-inclusive tuition fee (property of student, not College). Textbook stock-on hand was kept for distribution in 2019.

28

Current Past Due Total

A S A T 3 1 D E C E M B E R 2 0 1 8 0-30 days 31-60 Days 61-90 Days + 90 Days

Student Debtors:Gross BalancesLess: Provision for ImpairmentNet Balances

Staff Debtors:Gross BalancesLess: Provision for ImpairmentNet Balances

Provincial Government:Gross BalancesLess: Provision for ImpairmentNet Balances

National Government:Gross BalancesLess: Provision for ImpairmentNet Balances

Prepaid Expenses:Gross BalancesLess: Provision for ImpairmentNet Balances

Sundry Debtors:Gross BalancesLess: Provision for ImpairmentNet Balances

Municipal Deposits:Gross BalancesLess: Provision for ImpairmentNet Balances

Other Receivables:Gross BalancesLess: Provision for ImpairmentNet Balances

---

-

-

--

1,409,119

1,409,119

163,472-

163,472

1,160,075

1,160,075

---

75,756-

75,756

---

8,205-

8,205

85,450-

85,450

119,040-

119,040

---

134,314

134,314

---

---

---

---

-

1,900-

1,900

---

176,667-

176,667

---

---

7,069,976823,998

6,245,978

381,988241,751140,237

72,80072,800

-

350,30447,992

302,312

--

321,123177,819143,304

21,451-

21,451

---

7,069,976823,998

6,245,978

390,192241,751148,442

158,25072,80085,450

1,880,36347,992

1,832,371

163,472-

163,472

1,792,179177,819

1,614,360

21,451-

21,451

75,756-

75,756

Current Past Due Total

A S A T 3 1 D E C E M B E R 2 0 1 8 0-30 days 31-60 Days 61-90 Days + 90 Days

All Receivables:Gross BalancesLess: Provision for ImpairmentNet Balances

2,808,422-

2,808,422

347,009-

347,009

178,567-

178,567

8,217,6421,364,3596,853,282

11,551,6391,364,359

10,187,280

3.1 Ageing of Receivables from Exchange Transactions

As at 31 December 2018 Receivables of R7,378,858 were past due but not impaired.The age analysis of these Receivables are as follows:

29

Current Past Due Total

A S A T 3 1 D E C E M B E R 2 0 1 7 0-30 days 31-60 Days 61-90 Days + 90 Days

Student Debtors:Gross BalancesLess: Provision for ImpairmentNet Balances

Staff Debtors:Gross BalancesLess: Provision for ImpairmentNet Balances

Provincial Government:Gross BalancesLess: Provision for ImpairmentNet Balances

National Government:Gross BalancesLess: Provision for ImpairmentNet Balances

Prepaid Expenses:Gross BalancesLess: Provision for ImpairmentNet Balances

Sundry Debtors:Gross BalancesLess: Provision for ImpairmentNet Balances

Municipal Deposits:Gross BalancesLess: Provision for ImpairmentNet Balances

0-0

342

342

2,401,345-

2,401,345

265,114-

265,114

180,191-

180,191

509,388-

509,388

---

---

---

---

125,103-

125,103

---

323,502-

323,502

---

---

---

---

1,180-

1,180

---

96,372-

96,372

---

15,275,805.47926,269

14,349,536

311,923-

311,923

174,750102,000

72,750

2,031,297947,881

1,083,416

80,645-

80,645

329,240101,683227,557

69,260-

69,260

15,275,805.47926,269

14,349,536

312,265-

312,265

2,576,095102,000

2,474,095

2,422,694947,881

1,474,813

260,837-

260,837

1,258,502101,683

1,156,819

69,260-

69,260

Current Past Due Total

A S A T 3 1 D E C E M B E R 2 0 1 7 0-30 days 31-60 Days 61-90 Days + 90 Days

All Receivables:Gross BalancesLess: Provision for ImpairmentNet Balances

3,356,381

3,356,381

448,605-

448,605

97,552-

97,552

18,272,9212,077,833

16,195,088

22,175,4592,077,833

20,097,626

As at 31 December 2017 Receivables of R16,741,245 were past due but not impaired.The age analysis of these Receivables are as follows

2018R

2017R

Balance at beginning of yearImpairment Losses recognisedImpairment Losses reversedAmounts written off as uncollectable

Balance at end of year

2,077,8331,364,359(641,482)

(1,436,351)

1,364,359

1,443,6595,644,250(258,560)

(4,751,516)

2,077,833

3.2 Reconciliation of the Provision for Impairment

30

3.3 Ageing of impaired Receivables from Exchange Transactions

3.4 Derecognition of Financial Assets

No Financial Assets have been transferred to other parties during the year.

The provision for bad debts is based on management’s experience of debtors. Reference is made to NSFAS receivables still outstanding at year end. Based on management’s experience, many of the debtors are expected to settle outstanding amounts during the next

The credit quality of trade and other receivables from exchange transactions are determined and monitored with reference to historical payment trends. Accordingly the credit quality of the customers included in the balance of trade and other receivables from exchange transactions is determined internally by applying managerial knowledge and experience. Based on the evaluation of the historical payment trends, customers included in the balance are categorised into the following:

year’s registration process or through NSFAS allocations received during the first semester of the new year. Only receivables outstanding for more than 90 days are considered for impairment.

2018R

2017R

Past Due: + 90 DaysTotal

1,364,3591,364,359

2,077,8332,077,833

2018R

2017R

The credit quality of trade and otherStudent DebtorsStaff DebtorsProvincial GovernmentNational GovernmentPrepaid ExpensesSundry DebtorsMunicipal DepositsOther Receivables

MediumMediumHighHighHighMediumHighHigh

6,245,978148,442

85,4501,832,371

163,4721,614,360

21,45175,756

10,187,280

14,349,536312,265

2,474,0951,474,813

260,8371,156,818

69,260-

20,097,625

Credit quality of financial assets carried at amortised cost.Method of determining credit quality of other non-current financial assets.

High credit quality: Customers included in thiscategory have evidenced no defaults or breaches inthe contractual repayments.Medium credit quality: Customers included in thiscategory are prone to late payments, but seldom default on the entire balance owingLow credit quality: Customers included in this balance in-cludes customers that frequently default on their outstanding balances and breach contract. No external credit quality determination have been performed.

4 . R E C E I VA B L E S F R O M N O N - E X C H A N G E T R A N S A C T I O N S

Gross BalancesR

Provision for ImpairmentR

Net BalancesR

A S A T 3 1 D E C E M B E R 2 0 1 8Statutory Receivable: Government Grants and SubsidiesSundry DebtorsTotal Receivables from Non-exchange Transactions

A S A T 3 1 D E C E M B E R 2 0 1 7Statutory Receivable: Government Grants and SubsidiesTotal Receivables from Non-exchange Transactions

9,160,092

9,160,092

12,383,34112,383,341

-

-

--

9,160,092

9,160,092

12,383,34112,383,341

The college does not hold deposits or other security for its Receivables.None of the Receivables have been pledged as security for the college’s financial liabilities.

31

5.1 Current Investment Deposits

5.2 Bank Accounts

For the purposes of the Statement of Financial Position and the Cash Flow Statement, Cash and Cash Equivalentsinclude Cash-on-Hand, Cash in Banks and Investments in Money Market Instruments.

Call Deposits are investments with a maturity period of less than 3 months and earn variable interest rates.

The college has the following bank accounts:

5 . C A S H A N D C A S H E Q U I VA L E N T S

2018R

2017R

Current InvestmentsBank AccountsCash and Cash EquivalentsTotal Bank, Cash and Cash Equivalents

897,41147,377,651

1,10048,276,161

845,8592,405,394

1,1003,252,354

2018R

2017R

Call DepositsTotal Current Investment Deposits

897,411897,411

845,859845,859

2018R

2017R

Cash in BankTotal Bank Accounts

47,377,65147,377,651

2,405,3942,405,394

Current Past Due Total

0-30 days 31-60 Days 61-90 Days + 90 Days

A S A T 3 1 D E C E M B E R 2 0 1 8

Statutory Receivable: Government Grants and SubsidiesGross BalancesNet Balances

All Receivables:Gross BalancesNet Balances

A S A T 3 1 D E C E M B E R 2 0 1 7

Statutory Receivable: Government Grants and SubsidiesGross BalancesNet Balances

All Receivables:Gross BalancesNet Balances

9,160,0929,160,092

9,160,0929,160,092

12,383,34112,383,341

12,383,34112,383,341

--

--

--

--

--

--

--

--

--

--

--

--

9,160,0929,160,092

9,160,0929,160,092

12,383,34112,383,341

12,383,34112,383,341

4.1 Ageing of Receivables from Non-exchange Transactions

32

2018R

2017R

P R I M A R Y B A N K A C C O U N TStellenbosch: 4052412057 - Current AccountCash book balance at beginning of yearCash book balance at end of year

Bank statement balance at beginning of yearBank statement balance at end of year

Stellenbosch: 4086361078 - Current AccountCash book balance at beginning of yearCash book balance at end of year

Bank statement balance at beginning of yearBank statement balance at end of year

Stellenbosch: Savings AccountsCash book balance at beginning of yearCash book balance at end of year

Bank statement balance at beginning of yearBank statement balance at end of year

Stellenbosch: 9288289217 : Depositor PlusCash book balance at beginning of yearCash book balance at end of year

Bank statement balance at beginning of yearBank statement balance at end of year

Stellenbosch: 4078879219 : Student Deposits - Current AccountCash book balance at beginning of yearCash book balance at end of year

Bank statement balance at beginning of yearBank statement balance at end of year

Stellenbosch: 4078880852: Student EFT - Current AccountCash book balance at beginning of yearCash book balance at end of year

Bank statement balance at beginning of yearBank statement balance at end of year

1,703,4974,101,693

1,703,4974,101,693

67,2043,642,124

67,2043,642,124

20,76022,245

20,76022,245

17,20611,444,424

17,20611,444,424

185,02389,654

185,02389,654

5,9973,953

5,9973,953

6,518,6461,703,497

6,518,6461,703,497

6,81467,204

6,81467,204

29,15820,760

29,15820,760

2,165,47717,206

2,165,47717,206

96,585185,023

96,585185,023

63,7885,997

63,7885,997

Stellenbosch: 4078880909: National Skills FundCash book balance at beginning of yearCash book balance at end of year

Bank statement balance at beginning of yearBank statement balance at end of year

Stellenbosch: DHET Infrastructure GrantCash book balance at beginning of yearCash book balance at end of year

Bank statement balance at beginning of yearBank statement balance at end of year

Stellenbosch: NSF - COS ProjectsCash book balance at beginning of yearCash book balance at end of year

Bank statement balance at beginning of yearBank statement balance at end of year

405,707379,933

405,707379,933

-17,062,445

-17,062,445

-9,933,754

-9,933,754

1,111405,707

1,111405,707

--

--

--

--

33

2018R

2017R

Stellenbosch: Special ProjectsCash book balance at beginning of yearCash book balance at end of year

Bank statement balance at beginning of yearBank statement balance at end of year

Cash and cash equivalents pledged as collateral32 Day Notice Deposit - 2068049430Money Market Investment Drakenstein Municipality32 Day Notice Deposit - 9331592832

Cash and cash equivalents that are not available for use by the collegeNational Skills FundInfrastructure grantNSF - COS ProjectsSpecial Projects

-697,425

-697,425

395,84257,894

435,493889,229

379,93317,062,445

9,933,754697,425

28,073,556

--

--

366,95953,951

408,011828,920

405,707

405,707

2018R

2017R

Cash Floats and AdvancesTotal Cash on hand in Cash Floats, Advances and Equivalents

1,1001,100

1,1001,100

5.3 Cash and Cash Equivalents

The following investments were pledged as collateral for: 32 Day Notice Deposit - 2068049430: Pledged as collateral against DBSA bond (3 months instalments)ended 31 August 2018.Money Market Investment Drakenstein Municipality - 9112826777: Municipal Deposits at bank32 Day Notice Deposit - 9331592832: Tsebo food services for capital investments - pledged amount equivalent of 1 monthly contract value

The college did not pledge any of its Cash and Cash Equivalents as collateral for its financial liabilities.

No restrictions have been imposed on the college in terms of the utilisation of its Cash and Cash Equivalents.

College is contractually restricted from using National Skills Fund and DHET Infrastructure funding for purposes other than those stipulated in the respective contracts with the funders.

34

6 . P R O P E R T Y, P L A N T A N D E Q U I P M E N T

Description Land BuildingsComputer Equipment

Furniture and

Fittings

Plant, Machinery

and Equipment

Motor Vehicles

Total

R R R R R R R

Carrying values at 01 January 2018

CostAccumulated Depreciation:

AcquisitionsCapital under Construction - Additions:

Depreciation:

Carrying value of Disposals:- Cost- Accumulated Impairment Losses- Accumulated Depreciation

Capital under Construction - CompletedOther Movements

Carrying values at 31 December 2018

CostAccumulated Impairment LossesAccumulated Depreciation:

71,033,034

71,033,034-

-

-

-

(1,957,750)(1,957,750)

--

--

69,075,284

69,075,284--

150,508,948

171,301,062(20,792,114)

2,035,783

-

(4,231,067)

(5,948,216)(7,177,205)

-1,228,989

--

142,365,448

166,159,640-

(23,794,192)

5,602,778

17,900,877(12,298,099)

427,592

-

(1,981,786)

(7,260)(50,372)

-43,112

--

4,041,324

18,278,097-

(14,236,773)

14,914,340

29,720,571(14,806,230)

568,245

-

(2,532,352)

(10,741)(299,427)

-288,687

--

12,939,492

29,989,388-

(17,049,896)

4,064,028

7,094,221(3,030,192)

930,751

-

(729,681)

(11,453)(18,428)

-6,976

--

4,253,645

8,006,543-

(3,752,898)

54,513

114,271(59,758)

-

-

(9,140)

----

--

45,373

114,271-

(68,898)

246,177,642

297,164,035(50,986,394)

3,962,371

-

(9,484,027)

(7,935,420)(9,503,182)

-1,567,763

--

232,720,566

291,623,224-

(58,902,658)

35

6 . P R O P E R T Y, P L A N T A N D E Q U I P M E N T ( C O N T I N U E D )

Description Land BuildingsComputer Equipment

Furniture and

Fittings

Plant, Machinery

and Equipment

Motor Vehicles

Total

R R R R R R R

Carrying values at 01 January 2017

Cost - As per prior AFS:

Cost - Correction of error (Note 40):Accumulated Impairment Losses:Acc. Depreciation - As per prior AFS:Acc Depreciation - Correction of error:

AcquisitionsCapital under Construction - Additions:

Depreciation:

Carrying value of Disposals:- Cost- Accumulated Depreciation

Capital under Construction - CompletedOther Movements

Carrying values at 31 December 2017

Cost- Completed Assets- Under ConstructionAccumulated Impairment LossesAccumulated Depreciation:

71,033,034

71,033,034

----

--

-

---

--

71,033,034

71,033,03471,033,034

---

154,194,421

172,657,480

(1,918,277)-

(16,752,398)207,617

69,346492,513

(4,247,333)

---

(3,782,927)3,782,927

150,508,948

171,301,062171,301,062

--

(20,792,114)

7,736,410

19,428,887

126,976-

(11,793,088)(26,364)

432,819-

(2,560,785)

(5,666)(2,087,805)

2,082,139

--

5,602,778

17,900,87717,900,877

--

(12,298,099)

17,514,435

18,230,201

11,484,413-

(7,864,232)(4,335,947)

81,436-

(2,676,331)

(5,199)(75,479)

70,280

--

14,914,340

29,720,57129,720,571

--

(14,806,230)

4,782,007

7,115,393

(11,335)-

(2,299,156)(22,894)

26,463-

(744,442)

-(36,300)

36,300

--

4,064,028

7,094,2217,094,221

--

(3,030,192)

64,498

114,271

--

(49,773)-

--

(9,985)

---

--

54,513

114,271114,271

--

(59,758)

255,324,806

288,579,266

9,681,776-

(38,758,647)(4,177,589)

610,063492,513

(10,238,876)

(10,865)(2,199,583)

2,188,718

(3,782,927)3,782,927

246,177,642

297,164,035297,164,035

--

(50,986,394)

PPE for which the College does have the legal title, but does not have control:

CALEDONCollege StreetERF 276 & ERF 297

WORCESTERDurban StreetERF1688

PAARLHuis Bruwer since 01-10-2018ERF 9018Property owned by Boland College, but utilised by another state entity as per arrangement

PPE for which the College does not have the legal title, but has control:

CALEDONKoalisie StreetERF 1114Property owned by WCED, but utilised byBoland College as per arrangement

36

2016 2013

CALEDON

PAARL

PAARL

STELLENBOSCH

STRAND

WORCESTER

STELLENBOSCH

Caledon

Drakenstein Campus

Paarlberg Campus

Stellenbosch

Strand

Worcester

Stellenbosch

Koalisie Street

Hospital Street

Cnr Hospital, Breede & Pleinstreet

Van Riebeeck Street

71 Aerodrome Street

Rainier Street

85 Bird Street

ERF 1114

ERF 1019, 1020, 1021 & ERF 1023

ERF 17258 & 19517

ERF 13072 & 13073

ERF 9798

ERF 20800

ERF 4431

T2051/1972 & t38310/2015

T24249/1994 & T24835/2010

T24249/1994

T21638/1996 & T24835/2010

T24835/2010 & T32007/1993

T36523/1986 & T90269/2004

T25137/2004

15,000,000

45,900,000

20,600,000

97,100,000

32,900,000

76,900,000

30,100,000

8,000,000

34,100,000

8,500,000

64,600,000

31,200,000

50,000,000

22,600,000

318,500,000 219,000,000

The Market Values as at 31 December 2016 (previous valuation 2013) of all the properties that the Collegerecognises on its Statement of Financial Position are listed below.

37

6 . P R O P E R T Y, P L A N T A N D E Q U I P M E N T ( C O N T I N U E D )

6.1 Gross Carrying Amount of Property, Plant and Equipment that is fully depreciated and still in use There are no Property, Plant and Equipment that is fully depreciated at year-end and still in use by the college.

6.2 Carrying Amount of Property, Plant and Equipment retired from active use and not classified as a Discontinued Operation

No Property, Plant and Equipment were retired from active use and not classified as a Discontinued Operation during the financial year.

6.3 Assets pledged as security The college did not pledge any of its Property, Plant or Equipment as security. 6.4 Land and Buildings carried at Fair Value The college’s Land and Buildings are accounted for according to the cost model and therefore no fair value has been determined.

6.5 Calculation of Cash Flow:

6.6 Delayed Projects

No projects that are currently in progress are experiencing significant delays.

6.7 Expenditure incurred to Repair and Maintain Property, Plant and Equipment

The following specific costs included in the amount of Repairs and Maintenance disclosed in Note 25 were incurred by entity during the reporting period:

2018R

2017R

Acquisitions per ReconciliationLess In Kind Public ContributionsTotal Purchase of Property, Plant and Equipment

Disposals per ReconciliationLess Gains / Losses on Disposal of Capital AssetsTotal Proceeds on Disposal of Property, Plant and Equipment

Note 13

Refer Note 39

(3,962,371)617,590

(3,344,781)

7,935,420(7,934,420)

1,000

(1,102,577)-

(1,102,577)

10,865(17,514) (6,649)

2018R

2017R

Land and Buildings- Contracted Services- Inventory Consumed- Labour- Other Operational Costs

Computer Hardware/Equipment- Inventory Consumed- Labour- Other Operational Costs

Other Assets- Inventory Consumed

Furniture And Fittings- Contracted Services- Inventory Consumed- Labour

Plant & Equipment- Contracted Services

Motor Vehicles - General- Inventory Consumed

5,529,1334,026,1081,205,314

267,91229,799

102,92698,010

3,4211,495

--

319,532253,491

25,89740,143

82,31482,314

51,73651,736

5,160,4044,802,620

328,030-

29,754

41,55341,553

--

2,9802,980

157,247157,247

0-

99,35799,357

27,89127,891

Total expenditure incurred to repair and maintain PPE 6,085,641 5,489,433

38

Performance Bonus

Pay Progression cycle runs over a continuous period of twelve months commencing on 01 April of a particular year. Only an employee: Who has completed a continuous period of twelve months of his/her salary notch on 31 March of a financial year, andWho performed acceptably in line with the Staff Management and Development system (SPDMS) will qualify for a pay progression, which, if justified, will be paid annually after 1 July of each year.Pay Progression is only applicable to staff who has not reached their top notch yet.

Performance Bonus to a maximum of 10 % and 18 % of the employee’s basic salary (annual) may be considered in recognition of an overall performance rating of 4 and 5 respectively. The payment of these cash bonuses is not guaranteed and is dependent on the college/department having sufficient financial resources to pay them. All submissions are subjected to moderation by the PM Moderation Committee. Performance bonuses are paid annually after 1 July.

2 0 1 8Reconcilliation of Movement of Provision

Prov. for Leave PayR

Housing Contr.R

Long Service Aw.R

TotalR

Opening balanceProvisions RaisedAmounts utilized in 2018Closing Balance

528,398433,581

-528,398 433,581

1,460,600521,811

-1,982,410 -

1,988,998955,392

-528,398 2,415,991

Non-current provisionsCurrent portion provisions 433 581 1,982,410 - 2,415,991

2 0 1 7Reconcilliation of Movement of Provision

Prov. for Leave PayR

Housing Contr.R

Long Service Aw.R

TotalR

Opening balanceProvisions RaisedAmounts utilized in 2017Closing Balance

233,236528,398

-233,236528,398

593,570867,030

-1,460,600

----

826,8051,395,428-233,236

1,988,998

Non-current provisionsCurrent portion provisions 528 398 1,460,600 - 1,988,998

7 . PAYA B L E S F R O M E X C H A N G E T R A N S A C T I O N S

2018R

2017R

Trade CreditorsClass Fees Received In AdvanceOther CreditorsBursary FundHousing Contribution ProvisionNSFAS Credits (students)Net Pay ControlStaff Leave Provision

2,305,9441,803,5492,297,684

940,6741,982,4101,679,701

0433,581

3,935,521924,776212,492

(0)1,460,6003,929,298

521,238528,398

Total Payables 11,443,543 11,512,323

Reclassification of Refundable deposit from Longterm liabilities - see note 40.3

7.1 Provisions

Provision for Leave Pay

Staff Leave:Employees are required to take at least 22 days during the annual leave cycle. The remaining leave days, if any, must be taken no later than 6 months after expiry of the relevant leave cycle, where-after any unused leave credits shall be forfeited.

Long Service Awards

Long Service Awards are made in recognition of the loyal, long-standing contributions and support of the College staff. The following categories of employees qualify for long-service awards:

Employees employed on a permanent basis within a minimum of five years continuous unbroken service.Employees appointed on a full-time, fixed contract longer than one year and whose contract was extended on the same conditions for periods up to five years and longer.

The college did not default on any payment of its trade creditors, however a late payment to SARS resulted in interest being charged.

39

Disbursements refer to stipends, tuition fees and infrastructure expenditure.

8 . U N S P E N T C O N D I T I O N A L G R A N T S A N D R E C E I P T S

2 0 1 8R

2 0 1 7R

8.1 Conditional Grants from GovernmentOther Spheres of GovernmentNon-Current Liabilities: StipendsNational Skills FundNational Skills Fund - COS projectNational Skills Fund 2016-2018

Deferred IncomeMaths E-Learning SupportICT TrainingDHET FundingCOS Funding 2019Merseta FundingInfrastructure SubsidyOther government grants and subsidies - (CLC)

49,979,10249,979,1028,557,200

10,368,0649,986,218

381,847

13,022,681107,989157,167

3,554,0009,153,525

50,00017,154,325

876,831

13,880,72013,880,7209,409,210

405,707

405,707

3,656,989102,989

3,554,000

-408,814

Total Conditional Grants and Receipts 49,979,102 13,880,720

1 0 . A C C U M U L A T E D S U R P L U S

2 0 1 8R

2 0 1 7R

The Accumulated Surplus consists of the following Internal Funds and Reserves:Accumulated Surplus due to the results of OperationsTotal Accumulated Surplus

239,621,277 239,621,277

256,340,377 256,340,377

1 1 . O T H E R T R A N S F E R S A N D S P O N S O R S H I P S

2 0 1 8R

2 0 1 7R

Gifts and sponsorships received 312,500 -

312,500 -

8.3 Movements during the yearBalance at the beginning of yearAdditions during the yearDisbursements

13,880,72055,762,761

(19,669,380)

14,946,85549,605,876

(50,672,011)

Total Conditional Grants and Receipts 49,979,102 13,880,720

2 0 1 8R

2 0 1 7R

Long-term LiabilitiesLess: Current Portion transferred to Current Liabilities:- DBSA LoanTotal Long-term Liabilities (Non-Current Portion):- Operating Lease Liability

-----

877,524544,190544,190333,333333,333

9 . L O N G - T E R M L I A B I L I T I E S

DBSA Loan:The term of the loan was 10 years, and ended 31 August 2018. (2017 : Loan was paid in 12 equal installments of R71 431 at an interest rate of 13.20%).

The Mortgage agreement was with the Development Bank of South Africa. The mortage agreement was secured by a bond registered over 85 Bird Street, Stellenbosch property as

The Department of Economic Development and Tourism (Western Cape Provincial Government) subsidised a Mathematics intervention initiative. The subsidy was applied to fund the salary of the staff member involved in this function.

per note 6. Security was subsequently cancelled at Deeds Office.

Operating Lease: The lessee paid a refundable deposit of R333 333.32 to the college, which will be paid back with interest to the lessee on expiry of the contract. The college is however entitled to deduct from the deposit any amount owing by the lessee to the college, including any damages.

40

1 2 . G O V E R N M E N T G R A N T S A N D S U B S I D I E S

2 0 1 8R

2 0 1 7R

Other SubsidiesOperational Grants

National GrantsNational: DHET - PERSAL FundingNational: DHET - Programme FundingNational: DHET - Programme Funding (Persal Saving)National: NSF FundingTotal Government Grants and Subsidies

Government Grants and Subsidies:Conditional Grants - OperationalConditional Grants - NationalTotal Government Grants and Subsidies

12.1 Calculation of Cash Flow:Government Grants and Subsidies IncomeDHET - Persal Funding (Non-cash)Opening Balance of Debtors: Non-exchange TransactionsClosing Balance of Debtors: Non-exchange TransactionsOpening Balance of Unspent Government GrantsClosing Balance of Unspent Government GrantsTotal Receipts for Government Grants and Subsidies

12.2 PERSAL Funding:Balance unspent at beginning of yearCurrent year receiptsConditions met - transferred to Revenue

Note 4Note 4

849,711849,711

138,035,17487,930,67935,640,000

9,160,0925,304,402

138,884,885

852,071138,032,814

138,884,885

138,884,885(87,930,679)

12,383,341(9,160,092)

(13,880,720)49,979,10290,275,836

-87,930,679

(87,930,679) -

4,255,0674,255,067

142,379,13882,107,46328,866,00012,383,34119,022,333

146,634,205

1,681,167144,953,038

146,634,205

146,634,205(82,107,463)

10,834,000(12,383,341)(14,946,855)

13,880,720 61,911,266

-82,107,463

(82,107,463) -

1 3 . P U B L I C C O N T R I B U T I O N S A N D D O N A T I O N S

2 0 1 8R

2 0 1 7R

Other DonationsTotal Public Contributions and Donations

617,590617,590

--

2 0 1 8R

2 0 1 7R

12.3 Programme FundingBalance unspent at beginning of yearCurrent year receiptsConditions met - transferred to Revenue

35,640,000 (35,640,000)

-

- 28,866,000

(28,866,000)-

The National Department of Higher Education and Training (DHET) funds many of the activities of the college through

The National Department of Higher Education and Training (DHET) funds many of the activities of the college through means of a grant allocation. Programme funding is the portion of the funding which is paid to the college in cash.

The donated vehicle will exclusively be used for training purposes. All risk attached to the vehicle was transferred to Boland College on 4 September 2018.

The department of Higher Education (GIZ) donated Renewable Energy Technology Equipment to the college for

The college must submit a claim of actual expenditure for any Persal Savings to the department which is refunded to the college in cash.

means of a grant allocation. PERSAL funding is for the portion of funding that is paid via DHET’s own PERSAL payroll.

training purposes. All rights and obligations concerning the assets were transferred to the College for inclusion in our asset register.

Absa donated an amount of R10 000 for the 2018 Top Academic Achievers.

41

1 4 . T U I T I O N A N D R E L A T E D F E E S

2 0 1 8R

2 0 1 7R

Class Fees:- Students - NCV- Students - Report 191Learnership FeesOther FeesTotal Tuition and Related Fees

Tuition Fees paid directly by Students or Private Bursaries:Tuition Fees - Students (Report 191)Tuition Fees - Students (NCV)Tuition Fees - LearnershipsTuition Fees - Other

Tuition Fees funded by NSFAS Bursaries:Tuition Fees - Students (Report 191)Tuition Fees - Students (NCV)Tuition Fees - Residence

Total Tuition and Related Fees

14.1 Calculation of Cash Flow:Tuition and Related Fees IncomeOpening Balance of Debtors: Tuition FeesClosing Balance of Debtors: Tuition FeesOpening Balance of Class Fees in AdvanceClosing Balance of Class Fees in AdvanceAmounts written-off as uncollectable

Total Receipts for Tuition and Related Fees

11,921,65521,552,72712,008,59510,769,357

56,252,334

6,107,2921,059,920

12,008,595 7,881,198

27,057,004

15,445,43510,861,735

2,888,160

29,195,330

56,252,334

56,252,33422,175,458

(11,551,639)(924,776)1,803,549

(1,436,351)

66,318,574

13,761,17317,488,79513,232,102

8,174,391

52,656,460

9,829,0853,136,703

13,232,102 3,498,081

29,695,970

7,659,71010,624,470 4,676,310

22,960,490

52,656,460

52,656,46015,873,807

(22,175,458)(389,480)

924,776(4,751,516)

42,138,589

1 5 . R E N T A L O F FA C I L I T I E S A N D E Q U I P M E N T

2 0 1 8R

2 0 1 7R

Rental Revenue from AmenitiesRental Revenue from BuildingsTotal Rental of Facilities and Equipment

1,293,3665,924,614

7,217,980

1,073,8514,727,347

5,801,198

1 6 . I N T E R E S T E A R N E D

2 0 1 8R

2 0 1 7R

External Investments:Bank AccountInvestmentsTotal Interest Earned

16.1 Calculation of Interest Cash Flow:External Interest IncomeTotal Receipts for Interest Received

Interest Earned on Financial Assets, analysed by category of asset, is as follows:Financial Assets at Amortised CostHeld-to-Maturity Investments

266,576927,704

1,194,280

1,194,280 1,194,280

1,139,172 55,108

1,194,280

116,686282,780

399,466

399,466 399,466

299,991 99,476

399,466

1,194,280 399,466

Rental revenue earned on Facilities and Equipment is in respect of Non-financial Assets rented out. Letting of halls, classrooms, to mainly other government institutions, and

vacant residences to mainly University of Stellenbosch students. Boland College students get first priority to accommodation.

42

1 7 . S A L E O F G O O D S A N D R E N D E R I N G O F S E R V I C E S

2 0 1 8R

2 0 1 7R

Sale of GoodsRendering of ServicesTotal Sale of Goods and Rendering of Services

7,47013,987

21,457

45,789138,888

184,677

1 8 . O T H E R R E V E N U E

2 0 1 8R

2 0 1 7R

Bad Debts RecoveredInsurance ClaimsTender DocumentsSkills Development LevySundry IncomeTotal Other Revenue

18.1 Calculation of Cash Flow:Income from Other RevenueIncome from Rental of Facilities and EquipmentOther Transfers and SponsorshipsTotal Receipts for Other Revenue

Note 18Note 15Note 11

171,544168,005

5,700634,955418,887

1,399,091

1,399,0917,217,980

312,500 8,929,571

151,31015,30122,678

671,817510,657

1,371,762

1,371,7625,801,198

- 7,172,960

1 9 . E M P L O Y E E R E L A T E D C O S T S

2 0 1 8R

2 0 1 7R

Employee Related Costs: CouncilEmployee Related Costs - Salaries and Wages- Employee related costs - Salaries and Wages- Long Service Bonuses- Travel, Motor Car, Accommodation, Subsistence

and Other Allowances- Housing Benefits And Allowances- Other Payroll RelatedEmployee Related Costs - Contributions for UIF, Pensions and Medical Aids- Employee Related Costs - Contributions for UIF, Pensions

and Medical Aids- WCALeave AccrualCollege CouncilPerformance and Other Bonuses

49,099,97246,161,985

293,662

216,6072,093,610

334,109

521,989421,372

100,618(94,817)260,607

2,016,613

48,365,67945,189,118

97,958

185,4832,645,407

247,713

755,290607,617

147,673295,163147,005

2,085,105

51,804,364 51,648,241

DHET Management Fee Cost:Employee Related Costs - Salaries and Wages- Employee related costs - Salaries and Wages- Employee related costs - Contributions for UIF, pensions

and medical aids- Housing Benefits and Allowances- Tavel, Motor Car, Accommodation, Subsistence

and Other Allowances- Performance and Other BonusesTotal Employee Related Costs

87,930,67964,902,743

13,913,9922,639,008

29,3316,308,826

87,930,679

82,107,46361,209,754

12,094,8242,582,816

23,5376,196,533

82,107,463

139,735,044 133,755,704

19.1 Calculation of Cash Flow:Employee Related Costs ExpenditureManagement Fee Cost (Non-cash)Leave AccrualHousing Contribution payableTotal Payments for Employee Related Costs

139,735,044(87,930,679)

94,817(521,811)

51,377,371

133,755,704(82,107,463)

(295,163)(867,030)

50,486,049

Restatement of allowances previously included in salaries and wages (2017: Housing-R1 778 376.68 and Medical Aid-R607 616.72)

43

2 0 1 8R

2 0 1 7R

19.2 Expenses paid via Persal from College programme funding:Lecturers engaged in Report 191 and NCV coursesSupport staff engaged in Report 191 and NCV coursesManagement remuneration

Expenses paid via College payroll:Lecturers engaged in Report 191 and NCV coursesSupport staff engaged in Report 191 and NCV coursesLecturers not engaged in Report 191 and NCV coursesSupport staff not engaged in Report 191 and NCV courses

Total employee cost and DHET management fee:Total fundedLecturers engaged in Report 191 and NCV coursesSupport staff engaged in Report 191 and NCV coursesManagement remuneration

Total non-funded and otherLecturers not engaged in Report 191 and NCV coursesSupport staff not engaged in Report 191 and NCV courses

58,130,81924,761,470

5,038,391 87,930,679

17,070,66530,356,158

2,208,247 449,490

50,084,560

75,201,48455,117,628

5,038,391 135,357,502

2,208,247 449,490 2,657,737

53,956,15924,513,190

3,638,114 82,107,463

13,571,61332,379,236

2,705,903 1,561,297

50,218,049

67,527,77356,892,426

3,638,114 128,058,313

2,705,903 1,561,297 4,267,200

2 0 . D E P R E C I A T I O N A N D A M O R T I S A T I O N

2 0 1 8R

2 0 1 7R

Depreciation: Property, Plant and EquipmentTotal Depreciation and Amortisation

9,484,027 9,484,027

10,238,876 10,238,876

2 2 . I M PA I R M E N T L O S S E S

2 0 1 8R

2 0 1 7R

22.1 Impairment Losses on Financial AssetsImpairment Losses Recognised:Receivables from Exchange TransactionsBad debt written off/backImpairment Losses Reversed:Receivables from Exchange Transactions

1,594,2921,364,359

229,933(641,482)(641,482)

5,989,1795,644,250

344,929(258,560)(258,560)

952,811 5,730,619

2 3 . M A R K E T I N G E X P E N S E S

2 0 1 8R

2 0 1 7R

AdvertisingBranding CostsPrintingStudent Related MarketingTotal Marketing Expenses

729,9077,262

610,664869,514

2,217,347

382,6818,632

406,902629,837

1,428,051

2 1 . E X T E R N A L A U D I T F E E S

2 0 1 8R

2 0 1 7R

External Audit Fees 2,311,745 1,451,460

In terms of the CET Act, employees that are employed by DHET and have a dual accountability towards the council and DHET respectively. The College has a formal process of approving new posts, based on operational need and

availability of funds, before recruitment. Seventeen (17) new positions were established in 2018 financial year. Thirteen (13) of these positions would be funded through DHET Persal funding, and four (4) through College Council fees.

44

2 4 . P R I N T I N G A N D S T A T I O N E R Y

2 0 1 8R

2 0 1 7R

Printing and Stationery 3,382,931 3,091,151

2 5 . R E PA I R S A N D M A I N T E N A N C E

2 0 1 8R

2 0 1 7R

Land and BuildingsComputer Hardware/EquipmentOther AssetsFurniture And FittingsPlant & EquipmentMotor Vehicles - GeneralTotal Repairs and Maintenance

5,529,133102,926

-319,532

82,31451,736

6,085,641

5,160,40441,553

2,980157,247

99,35727,891

5,489,433

2 7 . B O O K S A N D L E A R N I N G M A T E R I A L S

2 0 1 8R

2 0 1 7R

BooksTraining MaterialsTotal Books and Learning Materials

6,174,97755,791

6,230,769

4,470,128112,664

4,582,793

2 6 . F I N A N C E C O S T S

2 0 1 8R

2 0 1 7R

Loans and Payables at amortised costTotal Interest ExpenseLess: Amounts included in the Cost of qualifying AssetsTotal Interest Paid on External Borrowings26.1 Calculation of Cash Flow:Finance Cost ExpenditureTotal Payments for Finance Costs

27,25927,259

- 27,259

27,259 27,259

125,160125,160

-125,160

125,160125,160

2 8 . O P E R A T I N G L E A S E E X P E N S E

2 0 1 8R

2 0 1 7R

LaptopsVehiclesPhoto Copy MachinesTotal Operating Lease Expense

934,4341,011,2092,657,517

4,603,161

928,3271,469,3012,475,344

4,872,972

2 9 . P R O G R A M M E C O N S U M A B L E S

2 0 1 8R

2 0 1 7R

Programme ConsumablesTotal Programme Consumables

6,795,481 6,795,481

6,591,119 6,591,119

3 0 . M U N I C I PA L S E R V I C E S

2 0 1 8R

2 0 1 7R

ElectricityRates and TaxesSewerage And SanitationWaterTotal Municipal Services

4,334,9562,202,4071,882,0024,250,493

12,669,858

4,672,4992,642,8921,663,7372,841,729

11,820,857

3 1 . S T U D E N T S R E S I D E N T S M E A L S

2 0 1 8R

2 0 1 7R

Students mealsTotal Students Residents Meals

2,964,520 2,964,520

3,549,760 3,549,760

45

3 2 . P R O F E S S I O N A L S E R V I C E S

2 0 1 8R

2 0 1 7R

Consulting ServicesLegal ServicesTotal Professional Services

601,53340,616

642,149

211,367119,218

330,585

3 3 . S E C U R I T Y

2 0 1 8R

2 0 1 7R

Security ServicesTotal Security Costs

5,465,1675,465,167

5,150,553 5,150,553

3 4 . T R AV E L A N D A C C O M O DA T I O N

2 0 1 8R

2 0 1 7R

Accomodation - DomesticFuel and PetrolStudent Related Travel CostsTravel Cost - DomesticTotal Travel And Accommodation

130,74884,550

313,434392,397921,129

99,74066,483

399,708261,371

827,301

3 5 . T E L E P H O N E , P O S T A G E , I N T E R N E T, N E T W O R K A N D C O M M U N I C A T I O N C O S T S

2 0 1 8R

2 0 1 7R

Telephone costsPostage and courierData and network costsSoftware licensingTotal Telephone, Postage, Internet, Network and Communication Costs

1,740,649473,765

1,778,8751,738,6225,731,911

1,539,406294,348

1,786,0391,977,183

5,596,975

3 6 . T R A I N I N G A N D S T A F F D E V E L O P M E N T

2 0 1 8R

2 0 1 7R

Conferences and WorkshopsStaff AwardsStaff DevelopmentTotal Training and Staff Development

239,10710,219

585,832835,159

247,815-

626,305 874,120

3 7 . G R A N T S A N D S U B S I D I E S PA I D

2 0 1 8R

2 0 1 7R

Operational Grants- Private /Donor Bursaries- Transport- Boland College BursaryCapital GrantsTotal Grants and Subsidies

-276,000

50,792-

326,792

(1,400)2,757,085

103,306-

2,858,990

3 8 . G E N E R A L E X P E N S E S

2 0 1 8R

2 0 1 7R

Included in General Expenses are the following:Bank ChargesCleaning MaterialCateringHealth and SafetyHire Of Facilities & EquipmentInsuranceMembership And Subscription FeesStudent CardsStudent Development and AwarenessVehicle ExpensesTotal General Expenses

436,872798,173186,149167,463

-895,997191,363

68,306296,648260,926

3,301,897

523,368793,930183,450176,581426,764741,511177,290

80,312311,354255,001

3,669,561

46

2 0 1 8R

2 0 1 7R

38.1 Calculation of Other Payments Cash Flow:Expenditure for General ExpensesExpenditure for Profesional ServicesExpenditure for Grants and Subsidies PaidTotal for Other Payments

38.2 Calculation of Suppliers Paid Cash Flow:External Audit FeesMarketing ExpensesPrinting And StationeryRepairs and MaintenanceBooks and Learning MaterialsOperating Lease ExpenseProgramme ConsumablesMunicipal ServicesStudents Residents MealsSecurityTravel And AccommodationTelephone And InternetTraining And Staff DevelopmentBad Debt Written BackOpening Balance of Payables: Exchange TransactionsClosing Balance of Payables: Exchange TransactionsOpening Balance of Payables: Housing ContributionClosing Balance of Payables: Housing Contribution Opening Balance of Payables: Staff LeaveClosing Balance of Payables: Staff LeaveOpening Balance of Payables: Payments in AdvanceClosing Balance of Payables: Payments in AdvanceOpening Balance of InventoriesClosing Balance of InventoriesTotal for Suppliers Paid

Note 38Note 32Note 37

Note 21Note 23Note 24Note 25Note 27Note 28Note 29Note 30Note 31Note 33Note 34Note 35Note 36Note 22Note 7Note 7Note 7Note 7Note 7Note 7Note 7Note 7Note 2Note 2

3,301,897642,149326,792

4,270,838

2,311,7452,217,3473,382,9316,085,6416,230,7694,603,1616,795,481

12,669,8582,964,5205,465,167

921,1295,731,911

835,159229,933

11,512,323(11,443,543)

(1,460,600)1,982,410(528,398)

433,581(924,776)1,803,549(699,982)

699,82261,819,138

3,669,561330,585

2,858,990 6,859,136

1,451,4601,428,0513,091,1515,489,4334,582,7934,872,9726,591,119

11,820,8573,549,7605,150,553

827,3015,596,975

874,120344,929

12,687,636(11,512,323)

(593,570)1,460,600(233,236)

528,398(389,480)

924,776(203,847)

699,982 59,040,411

3 9 . G A I N S / L O S S E S O N D I S P O S A L O F C A P I T A L A S S E T S

2 0 1 8R

2 0 1 7R

Assets Disposed at Carrying Value:Losses on Disposal of AssetsTotal Gains / Losses on Disposal of Capital Assets

(7,934,420)(7,934,420)(7,934,420)

(17,514)(17,514)(17,514)

The Department of Higher Education and Training granted approval for the Disposal of Huis Bruwer , Erf 9018, in terms of section 3(3) of the Continuing Eduction Act, 16 of 2016. All risks and rewards were transferred to Paarl Gymnasium on 1 October 2018.

4 0 . C O R R E C T I O N O F E R R O R

Corrections were made during the previous financial years. Details of the corrections are described below: 40.1 Reclassification of Accumulated Surplus The prior year figures of Accumulated Surplus has been restated to correctly disclose the monies held by the college in terms of the disclosure notes indicated below.

47

2018R

2017R

AccumulatedSurplus

The effect of the changes are as follows:

Balances published as at 31 December 2016Correction of Error:- Acc. Deprecation of Furniture, previously classified as buildings- Cost of Furniture, previously not included in Asset Register- Acc. Deprecation of Furniture, previously not included in Asset Register- Cost of Assets previously recognised in incorrect period- Acc. Depreciation of Assets previously recognised in incorrect period- Cost of additional Furniture, previously not included in Asset Register- Acc. Deprecation of additional Furniture, previously not included in Asset Register- Buildings - Cost of Blinds Reclassified - Take on items- Buildings - Cost of Blinds Reclassified - Correction of Error items- Buildings - Deemed value of Aircons reclassified- Buildings - Cost of Aircons additions 2016 & 2017- Furniture and Fittings - Cost of Blinds Reclassified - Take on items- Furniture and Fittings - Cost of Blinds Reclassified - Correction of Error items- Furniture and Fittings - Deemed value of Aircons reclassified- Furniture and Fittings - Cost of Aircons additions 2016 & 2017- Buildings - Acc Depreciation of Blinds Reclassified - Take on items- Buildings - Acc Depreciation of Blinds Reclassified - Correction of Error items- Buildings - Acc Depreciation of Aircons reclassified- Buildings - Acc Depreciation of Aircons additions 2016 & 2017- Furniture and Fittings - Acc Depreciation of Blinds Reclassified - Take on items- Furniture and Fittings - Acc Depreciation of Blinds Reclassified - Correction of Error items- Furniture and Fittings - Acc Depreciation of Aircons reclassified- Furniture and Fittings - Acc Depreciation of Aircons additions 2016 & 2017- Acc. Depreciation of additional Furniture, previously classified as Buildings- Cost of Furniture newly verified in 2017/18- Acc Depreciation of Furniture newly verified in 2017/18- Cost of Computer Equipment newly verified in 2017/18- Acc Depreciation of Computer Equipment newly verified in 2017/18- Cost of Plant & Machinery newly verified in 2017/18- Acc Depreciation of Plant & Machinery newly verified in 2017/18- Acc. Depreciation of minor restatements- Cost of incorrect prices allocated in Asset Register- Acc. Deprecation of incorrect prices allocated in Asset Register- Acc. Depreciation of Aircon Additions incorrectly allocated to Buildings- Acc Deprecation revised on Computer Equipment- Acc Deprecation revised on Machinery and Equipment- Deemed Cost Correction of Furniture and Fittings- Acc Depreciation due to Deemed Cost Correction of Furniture and Fittings- Cost adjustment of Furniture incorrectly classified as Buildings- Cost adjustment of Buildings due to Furniture incorrectly classified- Acc Depreciation adjustment of Furniture incorrectly classified as Buildings- Acc Depreciation adjustment of Buildings due to Furniture incorrectly classified- Acc Deprecation revised on Furniture and Fittings- Deemed Cost Adjustment of Aircons reclassified from Buildings- Acc Depreciation on Deemed Cost Adjustment of Aircons reclassified from Buildings- Deemed Cost Adjustment of Aircons reclassified from Buildings due to incorrect dates- Acc Depr. on Deemed Cost Adjustment of Aircons reclassified from Buildings - incorrect dates- Cost Buildings - Correction of Deemed Cost of Blinds- Cost Furniture and Fittings - Correction of Deemed Cost of Blinds- Acc Depreciation Buildings - Correction of Deemed Cost of Blinds- Acc Depreciation Furniture and Fittings - Correction of Deemed Cost of Blinds- Cost of Furniture and Fittings - Deemed Cost Correction of newly added (internet source)- Acc Depreciation of Furniture and Fittings - Deemed Cost Correction of newly added

(internet source) Total Opening Balance Restatement

(485,020)81,454

(42,732)(139,254)

24,033282,976

(252,611)(1,187,200)

(13,962)(249,758)(311,538)1,187,200

13,962249,758311,538126,245

2,07623,488

3,901(126,245)

(2,076)(23,488)

(3,901)(1,428,199)

4,506,007(1,808,208)

126,976(40,533)125,519(50,458)

16,60218,493

(10,659)(57,321)

14,1694,121

37,523(14,336)177,201

(177,201)(10,700)

969431,503

4,813,038(524,031)(201,467)

63,30921,382

(21,382)(2,364)

6,92430,778

(12,314)

255,841,976

5,504,188

Restated Balances as at 31 December 2016 261,346,164

48

2018R

2017R

AccumulatedSurplus

Transactions incurred for the Year 2017Correction of Error:- Deprecation of Furniture, previously classified as buildings- Deprecation of Furniture, previously not included in Asset Register- Depreciation of Assets previously recognised in incorrect period- Deprecation of additional Furniture, previously not included in Asset Register- Buildings - Acc Depreciation of Blinds Reclassified - Take on items- Buildings - Acc Depreciation of Blinds Reclassified - Correction of Error items- Buildings - Acc Depreciation of Aircons reclassified- Buildings - Acc Depreciation of Aircons additions 2016 & 2017- Furniture and Fittings - Acc Depreciation of Blinds Reclassified - Take on items- Furniture and Fittings - Acc Depreciation of Blinds Reclassified - Correction of Error items- Furniture and Fittings - Acc Depreciation of Aircons reclassified- Furniture and Fittings - Acc Depreciation of Aircons additions 2016 & 2017- Depreciation of additional Furniture, previously classified as Buildings- Depreciation of Furniture newly verified in 2017/18- Depreciation of Computer Equipment newly verified in 2017/18- Depreciation of Plant & Machinery newly verified in 2017/18- Depreciation of minor restatements- Depreciation of Computer Equipment revised- Depreciation of Machinery and Equipment revised- Depreciation due to Deemed Cost Correction of Furniture and Fittings- Depreciation adjustment of Furniture incorrectly classified as Buildings- Depreciation adjustment of Buildings due to Furniture incorrectly classified- Deprecation revised on Furniture and Fittings- Depreciation on Deemed Cost Adjustment of Aircons reclassified from Buildings- Depreciation on Deemed Cost Adjustment of Aircons reclassified from Buildings - incorrect dates- Depreciation Buildings - Correction of Deemed Cost of Blinds- Depreciation Furniture and Fittings - Correction of Deemed Cost of Blinds- Depreciation of Furniture and Fittings - Deemed Cost Correction of newly added

(internet source) Total Restatement for the Year

(109,742)(4,306)18,567

(21,187)23,744

2794,9956,215

(23,744)(279)

(4,995)(6,215)

(559,083)(596,576)

(20,817)(16,497)

7,6835,1954,102

(5,679)(23,223)

3,854324,060

(120,302)15,838

(500)1,732

(4,104)

(3,904,801)

-1,100,986

Restated Balances as at 31 December 2017 256,340,377

49

Prior Year 2017 Expenditure

Current YearRestated 2 0 1 7

Expenditure

AmountRestated By

40.2 Reclassification of ExpenditureThe prior year figures of Expenditure Classes have been restated to correctly classify the nature of Expenditure of the college.

The effect of the Correction of Error is as follows:

Employee Related CostsCollection CostsDepreciation and AmortisationExternal Audit FeesImpairment LossesMarketing ExpensesPrinting And StationeryRepairs and MaintenanceFinance CostsBooks and Learning MaterialsOperating Lease ExpenseProgramme ConsumablesMunicipal ServicesStudents Residents MealsProfessional ServicesSecurityTravel And AccommodationTelephone And InternetTraining And Staff DevelopmentGrants and Subsidies PaidGeneral ExpensesLoss on Disposal of Property, Plant and Equipment

134,087,113-

9,137,8901,451,4605,730,6191,156,6253,091,1515,489,433

125,1604,582,7934,872,9726,591,119

11,820,8573,549,760

330,5855,150,553

827,3015,596,975

874,1202,858,9903,609,578

17,514

133,755,704-

10,238,8761,451,4605,730,6191,428,0513,091,1515,489,433

125,1604,582,7934,872,9726,591,119

11,820,8573,549,760

330,5855,150,553

827,3015,596,975

874,1202,858,9903,669,561

17,514

(331,408)-

1,100,986--

271,426--------------

59,983-

210,952,569 212,053,554 1,100,986

EmployeeRelated Costs

MarketingExpenses

GeneralExpenses

Balance previously reportedReclassification of Expenditure as per nature of transactionRestated Balance now reported

134,087,113(331,408)

133,755,704

1,156,625271,426

1,428,051

3,609,57859,983

3,669,561

Depreciation& Amortisation

Balance previously reportedAdjustment of Depreciation due to Asset Register RestatementsRestated Balance now reported

9,137,8901,100,986

10,238,876

Employee Related Costs The prior year amount for Employee Related Costs were restated to correctly disclose Marketing Expenses and General Expenses that were incorrectly disclosed.

Marketing Expenses

The prior year amount for Marketing Expenses were restated to correctly disclose expenditure previously classified as Employee Related Costs.

General Expenses The prior year amount for General Expenses were restated to correctly disclose expenditure previously classified as Employee Related Costs.

Depreciation and Amortisation The prior year amount for Depreciation and Amortisation was restated to correctly disclose the revised deprecia-tion amounts, due to restatements performed on PPE. Refer to the “Reclassification of Financial Position” for further details in this regard.

40.3 Reclassification of Statement of Financial Position The prior year figures of Classes in the Statement of Financial Position have been restated to correctly classify the nature of Assets, Liabilities and Net Assets of the college.

50

2018R

2017R

Prior Year 2017 Balance

Restated 2017Balance

AmountRestated By

The effect of the Correction of Error is as follows:Current AssetsInventoriesReceivables from Exchange TransactionsReceivables from Non-exchange TransactionsCash and Cash EquivalentsNon-Current AssetsProperty, Plant and EquipmentCurrent LiabilitiesPayables from Exchange TransactionsUnspent Conditional Grants and ReceiptsDBSA LoansNon-Current LiabilitiesLong-term LiabilitiesNet AssetsAccumulated Surplus / (Deficit)

699,98220,097,62512,383,341

3,252,354

241,774,440

(11,512,323)(13,880,720)

(544,191)

(333,333)

-251,937,175

699,98220,097,62512,383,341

3,252,354

246,177,642

(11,512,323)(13,880,720)

(544,191)

(333,333)

-256,340,377

----

4,403,201

---

-

-4,403,201

- - -

Property, Plant and Equipment

Accumulated Surplus

Balances previously published per AFS as at 31 December 2016Acc. Deprecation of Furniture, previously classified as buildingsCost of Furniture, previously not included in Asset RegisterAcc. Deprecation of Furniture, previously not included in Asset RegisterCost of Assets previously recognised in incorrect periodAcc. Depreciation of Assets previously recognised in incorrect periodCost of additional Furniture, previously not included in Asset RegisterAcc. Deprecation of additional Furniture, previously not included in Asset RegisterBuildings - Cost of Blinds Reclassified - Take on itemsBuildings - Cost of Blinds Reclassified - Correction of Error itemsBuildings - Deemed value of Aircons reclassifiedBuildings - Cost of Aircons additions 2016 & 2017Furniture and Fittings - Cost of Blinds Reclassified - Take on itemsFurniture and Fittings - Cost of Blinds Reclassified - Correction of Error itemsFurniture and Fittings - Deemed value of Aircons reclassifiedFurniture and Fittings - Cost of Aircons additions 2016 & 2017Buildings - Acc Depreciation of Blinds Reclassified - Take on itemsBuildings - Acc Depreciation of Blinds Reclassified - Correction of Error itemsBuildings - Acc Depreciation of Aircons reclassifiedBuildings - Acc Depreciation of Aircons additions 2016 & 2017Furniture and Fittings - Acc Depreciation of Blinds Reclassified - Take on itemsFurniture and Fittings - Acc Depreciation of Blinds Reclassified - Correction of Error itemsFurniture and Fittings - Acc Depreciation of Aircons reclassifiedFurniture and Fittings - Acc Depreciation of Aircons additions 2016 & 2017Acc. Depreciation of additional Furniture, previously classified as BuildingsCost of Furniture newly verified in 2017/18Acc Depreciation of Furniture newly verified in 2017/18Cost of Computer Equipment newly verified in 2017/18Acc Depreciation of Computer Equipment newly verified in 2017/18Cost of Plant & Machinery newly verified in 2017/18Acc Depreciation of Plant & Machinery newly verified in 2017/18Acc. Depreciation of minor restatementsCost of incorrect prices allocated in Asset RegisterAcc. Deprecation of incorrect prices allocated in Asset RegisterAcc. Depreciation of Aircon Additions incorrectly allocated to BuildingsAcc Deprecation revised on Computer EquipmentAcc Deprecation revised on Machinery and EquipmentDeemed Cost Correction of Furniture and FittingsAcc Depreciation due to Deemed Cost Correction of Furniture and FittingsCost adjustment of Furniture incorrectly classified as BuildingsCost adjustment of Buildings due to Furniture incorrectly classifiedAcc Depreciation adjustment of Furniture incorrectly classified as BuildingsAcc Depreciation adjustment of Buildings due to Furniture incorrectly classifiedAcc Deprecation revised on Furniture and FittingsDeemed Cost Adjustment of Aircons reclassified from BuildingsAcc Depreciation on Deemed Cost Adjustment of Aircons reclassified from BuildingsDeemed Cost Adjustment of Aircons reclassified from Buildings due to incorrect datesAcc Depr. on Deemed Cost Adjustment of Aircons reclassified from Buildings - incorrect datesCost Buildings - Correction of Deemed Cost of BlindsCost Furniture and Fittings - Correction of Deemed Cost of BlindsAcc Depreciation Buildings - Correction of Deemed Cost of BlindsAcc Depreciation Furniture and Fittings - Correction of Deemed Cost of BlindsCost of Furniture and Fittings - Deemed Cost Correction of newly added (internet source)Acc Depreciation of Furniture and Fittings - Deemed Cost Correction of newly added (internet source)Balances now published per AFS as at 31 December 2016

249,820,619(485,020)

81,454(42,732)

(139,254)24,033

282,976(252,611)

(1,187,200)(13,962)

(249,758)(311,538)1,187,200

13,962249,758311,538126,245

2,07623,488

3,901(126,245)

(2,076)(23,488)

(3,901)(1,428,199)

4,506,007(1,808,208)

126,976(40,533)125,519(50,458)

16,60218,493

(10,659)(57,321)

14,1694,121

37,523(14,336)177,201

(177,201)(10,700)

969431,503

4,813,038(524,031)(201,467)

63,30921,382

(21,382)(2,364)

6,92430,778

(12,314)255,324,806

255,841,976(485,020)

81,454(42,732)

(139,254)24,033

282,976(252,611)

(1,187,200)(13,962)

(249,758)(311,538)1,187,200

13,962249,758311,538126,245

2,07623,488

3,901(126,245)

(2,076)(23,488)

(3,901)(1,428,199)

4,506,007(1,808,208)

126,976(40,533)125,519(50,458)

16,60218,493

(10,659)(57,321)

14,1694,121

37,523(14,336)177,201

(177,201)(10,700)

969431,503

4,813,038(524,031)(201,467)

63,30921,382

(21,382)(2,364)

6,92430,778

(12,314)261,346,164

51

2018R

2017R

Movement as per 2016/17 AFSDeprecation of Furniture, previously classified as buildingsDeprecation of Furniture, previously not included in Asset RegisterDepreciation of Assets previously recognised in incorrect periodDeprecation of additional Furniture, previously not included in Asset RegisterBuildings - Acc Depreciation of Blinds Reclassified - Take on itemsBuildings - Acc Depreciation of Blinds Reclassified - Correction of Error itemsBuildings - Acc Depreciation of Aircons reclassifiedBuildings - Acc Depreciation of Aircons additions 2016 & 2017Furniture and Fittings - Acc Depreciation of Blinds Reclassified - Take on itemsFurniture and Fittings - Acc Depreciation of Blinds Reclassified - Correction of Error itemsFurniture and Fittings - Acc Depreciation of Aircons reclassifiedFurniture and Fittings - Acc Depreciation of Aircons additions 2016 & 2017Depreciation of additional Furniture, previously classified as BuildingsDepreciation of Furniture newly verified in 2017/18Depreciation of Computer Equipment newly verified in 2017/18Depreciation of Plant & Machinery newly verified in 2017/18Depreciation of minor restatementsDepreciation of Computer Equipment revisedDepreciation of Machinery and Equipment revisedDepreciation due to Deemed Cost Correction of Furniture and FittingsDepreciation adjustment of Furniture incorrectly classified as BuildingsDepreciation adjustment of Buildings due to Furniture incorrectly classifiedDeprecation revised on Furniture and FittingsDepreciation on Deemed Cost Adjustment of Aircons reclassified from BuildingsDepreciation on Deemed Cost Adjustment of Aircons reclassified from Buildings - incorrect datesDepreciation Buildings - Correction of Deemed Cost of BlindsDepreciation Furniture and Fittings - Correction of Deemed Cost of BlindsDepreciation of Furniture and Fittings - Deemed Cost Correction of newly added (internet source)Balances now published per AFS as at 31 December 2017

-8,046,178(109,742)

(4,306)18,567

(21,187)23,744

2794,9956,215

(23,744)(279)

(4,995)(6,215)

(559,083)(596,576)

(20,817)(16,497)

7,6835,1954,102

(5,679)(23,223)

3,854324,060

(120,302)15,838

(500)1,732

(4,104) 246,177,642

(3,904,801)(109,742)

(4,306)18,567

(21,187)23,744

2794,9956,215

(23,744)(279)

(4,995)(6,215)

(559,083)(596,576)

(20,817)(16,497)

7,6835,1954,102

(5,679)(23,223)

3,854324,060

(120,302)15,838

(500)1,732

(4,104)256,340,377

Property, Plant and Equipment:The 2016/17 Opening Balance of Property, Plant and Equipment has been restated due to Furniture and Fittings items previously incorrectly classified as Buildings.Furthermore, the Opening Balance of Property, Plant and Equipment has

4 2 . N O N - C A S H I N V E S T I N G A N D F I N A N C I N G T R A N S A C T I O N S

The college did not enter into any Non-cash Investing and Financing Transactions during the 2018 financial

also been restated to correctly disclose the accurate asset count and values, as per the revised Asset Register and newly identified assets. The Opening Balance restatements as indicated above also impacted the Depreciation expenditure of the prior period, and this was restated accordingly.

4 1 . C A S H G E N E R A T E D B Y O P E R A T I O N S

2 0 1 8R

2 0 1 7R

Surplus for the YearAdjustment for:Revenue Received-in-Kind: Persal GrantExpenditure incurred from Persal GrantPublic Contributions: In kindDepreciation and AmortisationLosses on Disposal of Property, Plant and EquipmentOther Movement on Property, Plant and EquipmentImpairment LossesBad Debts Written-offOperating surplus before working capital changesDecrease/(Increase) in InventoriesDecrease/(Increase) in Receivables from Exchange TransactionsDecrease/(Increase) in Receivables from Non-exchange TransactionsIncrease/(Decrease) in Payables from Exchange TransactionsIncrease/(Decrease) in Conditional Grants and ReceiptsCash generated by / (utilised in) Operations

(16,719,100)

(87,930,679)87,930,679

(617,590)9,484,0277,934,420

-722,877

(1,436,351)(631,718)

16010,623,819

3,223,249(68,779)

36,098,382 49,245,112

(5,005,787)

(82,107,463)82,107,463

-10,238,876

17,514-

5,385,690 (4,751,516)

5,884,777(496,136)

(6,301,651)(1,549,341)(1,175,314)(1,066,135)

(4,703,799)

4 3 . C O M M I T M E N T S F O R E X P E N D I T U R E

2 0 1 8R

2 0 1 7R

43.1 Capital CommitmentsCommitments in respect of Capital Expenditure:Approved and Contracted for:Land and Buildings - 1yrFurniture & Fittings - 1 yrTotal Capital Commitments

183,362

29,537153,826183,362

-

-

52

2018R

2017R

This expenditure will be financed from:Government GrantsOwn Resources

43.2 Commitments in respect of operational ExpenditureApproved and contracted forTextbooksMarketingMaintenance - 1yrMaintenance - olderOther - 1yrOther - olderTotal operational commitments

The operational commitments will be financed from:- Own resources

-183,362

183,362

966,205106,509

1,626,8961,213,6633,686,2483,949,540

11,549,060

11,549,060

-

1,606,308203,319

2,961,2432,647,756

181,091-

7,599,717

7,599,717

11,549,060 7,599,717

2018R

2017R

At the reporting date the College had outstanding commitments under non-cancellable operating leases, which fall due as follows:Up to 1 year1 to 5 years

2,498,373 588,232 3,086,605

1,786,089 1,087,918 2,874,006

2018R

2017R

At the reporting date the College had outstanding commitments:Up to 1 year1 to 5 years

780,392

780,392

928,327

773,606 1,701,933

2018R

2017R

At the reporting date the College had outstanding commitments under non-cancellable operating leases, which fall due as follows:Up to 1 year1 to 5 years

791,324 47,311 838,636

962,505 766,815 1,729,320

2018R

2017R

Total Operating Lease CommitmentsAt the reporting date the College had outstanding commitments under non-cancellable operating leases, which fall due as follows:Up to 1 year1 to 5 years

4,070,088 635,544 4,705,632

3,676,921 2,628,339 6,305,259

43.3 Operating Lease CommitmentsAt the reporting date the College has outstanding commitments under operating leases which fall due as follows:

LesseeThe category of asset leased is Photocopiers:

Photocopiers were negotiated for an average term of 5 years. Annual rental increase is linked to the Prime lending rate. Rentals are payable in advance. No contingent rent is payable. Ownership of the devices shall at all times, during and after termination of agreement, remain vested in Nashua/Cape Office(Bytes).

The category of asset leased is Laptops:

Laptops were negotiated for an average term of 4 years. Rentals are fixed (0% annual increase) over the term of the contract. Rentals are payable in advance and no contingent rent is payable. Ownership of the devices shall at all times, during and after termination of agreement remain vested in Dell Financial Services.

The category of asset leased is Motor Vehicles:

Operating Leases consists of the following:Vehicle leases are negotiated for an average term of 3 year/90 000 km full maintenance lease, and rentals are linked to change in interest rates. No contingent rent is payable. Ownership of vehicles comprising the fleet shall at all times, during and after termination of agreement, remain vested in Absa Vehicle Management Services.

53

2018R

2017R

LessorAt the reporting date the College had entered into a lease arrangement with the University of Stellenbosch for the lease of Rozenhof Residence for a period of 3 years, with a fixed rental increase of 6%.Up to 1 year1 to 5 years

2,247,200 - 2,247,200

2,120,000 2,247,200 4,367,200

2018R

2017R

Total Operating Lease Commitments At the reporting date the College had outstanding commitments under non-cancellable operating leases, which fall due as follows:Up to 1 year1 to 5 years

2,247,200

2,247,200

2,120,000

2,247,2004,367,200

The lessee paid a refundable deposit of R333 333.32 to the college, which will be paid back with interest to the lessee on expiry of the contract. The college is however entitled to deduct

from the deposit any amount owing by the lessee to the college, including any damages.

4 4 . F I N A N C I A L I N S T R U M E N T S

Financial Assets Classification2 0 1 8

R2 0 1 7

R

44.1 ClassificationFINANCIAL ASSETSIn accordance with GRAP 104.13 the Financial Assets of the college are classified as follows:Non-current InvestmentsOther InvestmentsReceivables from Exchange TransactionsStaff Debtors ControlProvincial GovernmentPrepaid ExpenditureStudent DebtorsNational GovernmentSundry DebtorsMunicipal DepositsGeneral AccrualsReceivables from Non-exchange TransactionsNational GovernmentCash and Cash EquivalentsCall DepositsBank BalancesCash Floats and Advances

SUMMARY OF FINANCIAL ASSETSFinancial Assets at Amortised Cost:Receivables from Exchange TransactionsReceivables from Exchange TransactionsReceivables from Exchange TransactionsReceivables from Non-exchange TransactionsCash and Cash EquivalentsCash and Cash EquivalentsFinancial Assets at Fair Value:Cash and Cash Equivalents

Total Financial Assets

Fair value

Amortised costAmortised costAmortised costAmortised costAmortised costAmortised costAmortised costAmortised cost

Amortised cost

Fair valueFair valueFair value

Student Debtors ControlOther Debtors

Other Exchange ServicesNational Government

Call DepositsBank Balances

Cash Floats and Advances

-

148,44285,450

163,4726,245,9781,832,3711,614,360

21,45175,756

9,160,092

897,41147,377,651

1,100

6,245,9783,680,622

260,6799,160,092

897,41147,377,651

67,622,433

1,100 1,100

67,623,533

-

312,2652,474,095

260,83714,349,536

1,474,8131,156,818

69,260-

12,383,341

845,8592,405,394

1,100

14,349,5365,417,991

330,09712,383,341

845,8592,405,394

35,732,219

1,100 1,100

35,733,319

54

Financial Liabilities Classification2 0 1 8

R2 0 1 7

R

FINANCIAL LIABILITIES In accordance with GRAP 104.13 the Financial Liabilities of the college are classified as follows:Long-term LiabilitiesCurrent Portion - DBSA

Payables from Exchange TransactionsTrade CreditorsIncome Received in AdvanceStaff Leave AccruedOther CreditorsNet Pay ControlBursary FundHousing ContributionNSFAS Creditors (students)Unspent Conditional GrantsDHET CreditorDHET 8% Fee increaseWeldingInfrastructure SubsidyPayments received in Advance -ETDP Seta RPL CentreCommunity Learning centreNational Skills FundNSF Creditor Non-ExchangeStipends

SUMMARY OF FINANCIAL LIABILITIESFinancial Liabilities at Amortised Cost:Current Portion - DBSAPayables from Exchange TransactionsUnspent Conditional Grants

Total Financial Liabilities

Amortised cost

Amortised costAmortised costAmortised costAmortised costAmortised costAmortised costAmortised costAmortised cost

Amortised costAmortised costAmortised costAmortised costAmortised costAmortised costAmortised costAmortised costAmortised cost

Annuity LoansTrade CreditorsTrade Creditors

2,305,943.991,803,549

433,5812,297,684

0940,674

1,982,4101,679,701

3,554,0009,153,525

17,154,325315,156876,831381,847

9,986,2188,557,200

(0)11,443,54349,979,102

61,422,645

61,422,645

877,524

3,935,521924,776528,398212,492521,238

(0)1,460,6003,929,298

3,554,000

102,989408,814405,707

9,409,210

877,52411,512,32313,880,720

26,270,567

26,270,567

2 0 1 8R

2 0 1 7R

Gearing Ratio

The gearing ratio at the year-end was as follows:DebtCash and Cash EquivalentsNet Debt

Equity

Net debt to equity ratio

(0)(48,276,161)

(48,276,161)

239,621,277

-20.15%

877,524(3,252,354)

(2,374,830)

256,340,377

-0.93%

44.2 Capital Risk Management The college manages its capital to ensure that the college will be able to continue as a going concern while delivering sustainable services to consumers through the optimisation of the debt and equity balance. The college’s overall strategy remains unchanged from 2017.

Debt is defined as Long-term Liabilities, together with its Short-term Portion.

Equity includes all Funds and Reserves of the college, disclosed as Net Assets in the Statement of Financial Performance and Net Debt as described above.

44.3 Financial Risk Management Objectives The Chief Financial Officer has overall responsibility for the establishment and oversight of the college’s risk management framework. The college’s risk management policies are

The capital structure of the college consists of debt, which includes Cash and Cash Equivalents and Equity, comprising Accumulated Surplus as disclosed in Note 10 and the Statement of Changes in Net Assets.

established to identify and analyse the risks faced by the college, to set appropriate risk limits and controls and to monitor risks and adherence to limits.

Due to the largely non-trading nature of activities and the way in which they are financed, colleges are not exposed to the degree of financial risk faced by business entities. Generally, Financial Assets and Liabilities are generated by day-to-day operational activities and are not held to manage the risks facing the college in undertaking its activities.

55

The Directorate: Financial Services monitors and manages the financial risks relating to the operations through internal policies and procedures. These risks include interest rate risk, credit risk and liquidity risk. Risk management policies and systems are reviewed regularly to reflect changes to market conditions and the college’s activities, and compliance with policies and procedures is reviewed by the internal auditors on a continuous basis, and annually by external auditors. The college does not enter into or trade financial instruments for speculative purposes.

The College Council manages the financial risks relating to the operations through internal policies and procedures. These risks include interest rate risk, credit risk and liquidity risk. Compliance with policies and procedures is reviewed by the internal auditors on a continuous basis, and annually by external auditors. The college does not enter into or trade financial instruments for speculative purposes.

The Corporate Treasury function reports quarterly to the college’s risk management committee, an independent body that monitors risks and policies implemented to mitigate risk exposures.

Internal audit, responsible for initiating a control framework and monitoring and responding to potential risk, reports periodically to the college’s audit committee, an independent body that monitors the effectiveness of the internal audit function.

Further quantitative disclosures are included throughout these Annual Financial Statements.

44.4 Significant Risks

It is the policy of the college to disclose information that enables the user of its Annual Financial Statements to evaluate the nature and extent of risks arising from Financial Instruments to which the college is exposed on the reporting date.

The college has exposure to the following risks from its operations in Financial Instruments:- Credit Risk;- Liquidity Risk; and- Market Risk.

Risks and exposures are disclosed as follows:

Market RiskMarket Risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the college’s income or the value of its holdings in Financial Instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return.

Credit RiskCredit Risk is the risk of financial loss to the college if a customer or counterparty to a Financial Instrument fails to meet its contractual obligations and arises principally from the college’s receivables from customers and investment securities.

Liquidity RiskLiquidity Risk is the risk that the college will encounter difficulty in meeting the obligations associated with its Financial Liabilities that are settled by delivering cash or another financial asset. The college’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the college’s reputation.

Liquidity Risk is managed by ensuring that all assets are reinvested at maturity at competitive interest rates in relation to cash flow requirements. Liabilities are managed by ensuring that all contractual payments are met on a timeous basis and, if required, additional new arrangements are established at competitive rates to ensure that cash flow requirements are met.

A maturity analysis for Financial Liabilities (where applicable) that shows the remaining undiscounted contractual maturities is disclosed in Note 44.8 to the Annual Financial Statements.

44.5 Market Risk

The college’s activities expose it primarily to the financial risks of changes in interest rates (see Note 44.7 below). No formal policy exists to hedge volatilities in the interest rate market.

There has been no change to the college’s exposure to market risks or the manner in which it manages and measures the risk.

56

44.5.1 Interest Rate Risk Management

Interest Rate Risk is defined as the risk that the fair value or future cash flows associated with a financial instrument will fluctuate in amount as a result of market interest changes.

Potential concentrations of interest rate risk consist mainly of variable rate deposit investments, long-term receivables, tuition fee debtors, other debtors, bank and cash balances.

The college limits its counterparty exposures from its money market investment operations by only dealing with Absa Bank and Investec. No investments with a tenure exceeding twelve months are made.

Tuition Fee Debtors comprise of a large number of students, dispersed across different industries and geographical areas. Consumer debtors are presented net of a provision for impairment.

In the case of debtors whose accounts become in arrears, very little actions can be instituted against these debtors since “restriction of services” is inappropriate given government’s objectives for TVET colleges.However, as a last resort, accounts are “handed over for collection” as applicable in terms of Council’s Financial Policy.

The college is not exposed to credit interest rate risk as the college has no borrowings.

The college’s exposures to interest rates on Financial Assets and Financial Liabilities are detailed in the Credit Risk Management section of this note.

Interest Rate Sensitivity Analysis The sensitivity analysis has been determined based on the exposure to interest rates at the Statement of Financial Position date. The analysis is prepared by averaging the amount of the investment at the beginning of the financial year and the amount of the investment at the end of the financial year. A 100 basis point increase or decrease was used, which represents management’s assessment of the reasonably possible change in interest rates. The short and long-term financial instruments at year-end with variable interest rates are set out in Note 44.8 below:

Cash and Cash Equivalents: If interest rates had been 100 basis points higher / lower and all other variables were held constant, the college’s: 44.6 Credit Risk Management

Credit Risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the college. The college has a sound debt management policy and obtains sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults.

The college uses its own trading records to assess its major customers. The college’s exposure of its counterparties are monitored regularly.

Potential concentrations of credit rate risk consist mainly of variable rate deposit investments, tuition fee debtors, other debtors, bank and cash balances.

Investments/Bank, Cash and Cash EquivalentsThe college limits its counterparty exposures from its money market investment operations (financial assets that are neither past due nor impaired) by only dealing with Absa Bank, and Investec. No investments with a tenure exceeding twelve months are made.

Trade and Other Receivables Trade and Other Receivables are amounts owed by students and other organs of state are presented net of impairment losses. The college does not have a credit risk policy in place, but the exposure to credit risk is monitored on an ongoing basis. The college is compelled in terms of its constitutional mandate to provide all its residents with basic minimum services without recourse to an assessment of creditworthiness.

In the case of debtors whose accounts become in arrears, very little actions can be instituted against these debtors since “restriction of services” is inappropriate given government’s objectives for TVET colleges. However, as a last resort, accounts are “handed over for collection” as applicable in terms of Council’s Credit Control and Debt Managment Policy.There were no material changes in the exposure to credit risk and its objectives, policies and processes for managing and measuring the risk during the year under review. The college’s maximum exposure to credit risk is represented by the carrying value of each financial asset in the Statement of Financial Position, without taking into account the value of any collateral obtained. The college has no significant concentration of credit risk, with exposure spread over a large number of students, and is not concentrated in any particular sector or geographical area.

The college establishes an allowance for impairment that represents its estimate of anticipated losses in respect of trade and other receivables.

The college does not have any significant credit risk exposure to any single counterparty or any group of counterparties having similar characteristics. The college defines counterparties as having similar characteristics if they are related entities. The credit risk on liquid funds is limited because the counterparties are banks with high credit-ratings.

The table below shows the balance of the 5 major counterparties at the balance sheet date. Management is of the opinion that, although these parties are the 5 counterparties with highest outstanding balances, no significant credit risk exposure exists based on the payment history of the parties.

57

31 December 2018 31 December 2017

Credit LimitR

CarryingAmount

R

Credit LimitR

CarryingAmount

R

Counterparty and LocationDepartment of Higher EducationWestern Cape Community Education and Training CollegeNational Skills FundETDP SetaUniversity Stellenbosch

135,000,0003,000,000

10,000,0001,200,0001,000,000

9,160,092876,831691,872479,000434,404

122,677,00039,000,00010,000,000

-1,000,000

12,383,341408,814

-39,00014,529

2018%

2017%

The major concentrations of credit risk that arise from the college’s receivables in relation to customer classification are as follows:Exchange Debtors:- Student Debtors- Other Services- AR DebtorsNon-Exchange Debtors:- DHETTotal Credit Risk

34.14%0.89%

20.75%

44.23% 100.00%

44.20%0.96%

19.01%

35.83% 100.00%

2018%

2017%

The maximum credit and interest risk exposure in respect of the relevant financial instruments is as follows:Receivables from Exchange TransactionsReceivables from Non-exchange TransactionsBank, Cash and Cash EquivalentsMaximum Credit and Interest Risk Exposure

11,551,6399,160,092

48,276,16168,987,893

22,175,45812,383,341

3,252,35437,811,153

2018R

2017R

Bank and Cash BalancesABSA Bank LtdCash EquivalentsTotal Bank and Cash Balances

Credit quality of Financial Assets:The credit quality of financial assets that are neither past due nor impaired can be assessed by reference to external credit ratings (if available) or to historical information about counterparty default rates:

Receivables from Exchange TransactionsCounterparties without external credit rating:Group 1Group 2

Total Receivables from Exchange Transactions

Receivables from Non-exchange TransactionsGroup 1Total Receivables from Non-exchange Transactions

48,276,161 48,276,161

-2,808,422

2,808,422

9,160,092 9,160,092

3,252,354 3,252,354

-3,356,381

3,356,381

12,383,341

12,383,341

Credit quality Groupings: Group 1

High certainty of timely payment. Liquidity factors are strong and the risk of non-payment is small.Group 2

Reasonable certainty of timely payment. Liquidity factors are sound, although ongoing funding needs may enlarge financing requirement. The risk of non-payment is small.

Group 3

Satisfactory liquidity factors and other factors which qualify the entity as investment grade. However, the risk factors of non-payment are larger.

None of the financial assets that are fully performing, have been renegotiated in the last year.

58

4 4 . F I N A N C I A L I N S T R U M E N T S ( C O N T I N U E D )

44.7 Liquidity Risk Management

Ultimate responsibility for liquidity risk management rests with the Council, which has built an appropriate liquidity risk management framework for the management of the college’s short, medium and long-term funding and liquidity management requirements. The college manages liquidity risk by maintaining adequate reserves, banking facilities, by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities.

Liquidity and Interest Risk Tables

The college ensures that it has sufficient cash on demand or access to facilities to meet expected

operational expenses through the use of cash flow forecasts.

The following tables detail the college’s remaining contractual maturity for its non-derivative financial liabilities. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the college can be required to pay.

Description

Noteref inAFS

AverageeffectiveInterest

Rate

Total6 Months

or less6 - 12

Months1 - 2Years

2 - 5Years

Morethan

5 Years

3 1 D E C E M B E R 2 0 1 8

Non-interest Bearing- Payables from Exchange transactions- Unspent Conditional Grants

Fixed Interest Rate Instruments- DBSA- Operating Lease - University Stellenbosch

3 1 D E C E M B E R 2 0 1 7

Non-interest Bearing- Payables from Exchange transactions- Unspent Conditional Grants

Fixed Interest Rate Instruments- DBSA- Short-term Loans

%

0.00%

13.20%13.20%

0.00%

13.20%13.20%

R

61,422,64511,443,54349,979,102

-

-

61,422,645

25,726,37611,845,65613,880,720

544,190544,190

-26,270,567

R

61,422,64511,443,54349,979,102

-

61,422,645

25,726,37611,845,65613,880,720

334,589334,589

-26,060,965

R

---

-

--

---

209,601209,601

-209,601

R

---

-

-

---

-

--

R

---

--

-

---

----

R

---

--

---

--

59

The following table details the college’s expected maturity for its non-derivative financial assets. The tables below have been drawn up based on the undiscounted contractual maturities of the financial assets including interest that will be earned on those assets except where the college anticipates that the cash flow will occur in a different period.

Description

Noteref inAFS

AverageeffectiveInterest

Rate

Total6 Months

or less6 - 12

Months1 - 2Years

2 - 5Years

Morethan

5 Years

3 1 D E C E M B E R 2 0 1 8

Non-interest Bearing- Trade Receivables from

Exchange Transactions- Trade Receivables from

Non-exchange Transactions- Cash and Cash Equivalents

Variable Interest Rate Instruments- Call Deposits- Bank Account

3 1 D E C E M B E R 2 0 1 7

Non-interest Bearing- Trade Receivables from

Exchange Transactions- Trade Receivables from

Non-exchange Transactions- Cash and Cash Equivalents

Variable Interest Rate Instruments- Call Deposits- Bank Account

%

0.00%

3.50%

0.00%

4.72%

R

19,348,472

10,187,280

9,160,0921,100

48,275,061897,411

47,377,65167,623,533

32,482,066

20,097,62512,383,341

1,100

3,251,254845,859

2,405,394-

35,733,319

R

19,348,472

10,187,280

9,160,0921,100

48,275,061897,411

47,377,65167,623,533

32,482,066

20,097,62512,383,341

1,100

3,251,254845,859

2,405,394

35,733,319

R

-

-

--

----

-

---

---

-

R

-

-

--

----

-

---

---

-

R

-

-

--

----

-

---

---

-

R

-

-

--

----

-

---

---

-

The college is not exposed to equity price risks arising from equity investments as the college does not trade these investments.

44.8 Other Price Risks

60

Name of Related Person Designation Description of Related Party Relationship

MinisterMr B NizimandiProfessor Hlengiwe MkhizeMs Naledi Pandor

MinisterMinisterMinister

Higher Education and TrainingHigher Education and TrainingHigher Education and Training

Name of Related Person Description of Related Party Relationship

InstitutionsCollege of Cape TownCommunity Colleges (CLC)Department of Higher Education and Training (DHET)Northlink CollegeFalse Bay CollegeWest Coast CollegeSouth Cape CollegeAgriSETABANKSETACATHSSETA CETACHIETAETDP SETAEWSETAFP&M SETAHWSETAINSETAMerSETAPSETAServices SETAW & R Seta

Related TVET CollegeDHETDHETRelated TVET CollegeRelated TVET CollegeRelated TVET CollegeRelated TVET CollegeSETAsSETAsSETAsSETAsSETAsSETAsSETAsSETAsSETAsSETAsSETAsSETAsSETAsSETAs

Name of Related Person Designation Office Appointment date End date

ManagementAdams, WCoetzee, JJMCoetzee, JJMGelderblom, IJGelderblom, IJNeal, CRPeters, EPlaatjies, D

CouncilBleazard, DKCloete, HCACoetzee, JJMDyers, OGelderblom, IJKabanyane, GCLingela, TSMacMaster, LLMMatolengwe, NMdludlu, MPeters, EPieterse, IPietersen, VRFPlaatjies, DVan der Merwe, HAVan Louw, CLVogel, A

VP: I&DPrincipalVP: CSActing: PrincipalCFOActing: CFOVP: EDTActing VP: CS

Chairperson

PrincipalSRCActing: Principal

VP: EDTSRC

Official OfficialOfficialOfficialOfficialOfficialOfficialOfficial

01-12-201101-08-201801-07-201401-07-201701-09-200717-07-201701-05-201601-11-2018

13-03-201410-09-201401-08-201807-05-201801-07-201710-09-201410-09-201413-03-201413-03-201406-09-201701-05-201607-05-201813-03-201408-05-201413-03-201410-09-201416-04-2018

31-07-201831-07-2018

31-07-2018

13-03-201913-03-2019

31-12-201831-07-201813-03-201913-03-201913-03-201913-03-201913-03-201913-03-201931-12-201813-03-201913-03-201913-03-201913-03-201913-03-2019

4 5 . R E L A T E D PA R T Y T R A N S A C T I O N S

All Related Party Transactions are conducted at arm’s length, unless stated otherwise.

45.1 Interest of Related Parties

Entities with whom the College has a relationship:Controlling Entity:

Entities under Common Control:

Councillors and/or management of the college had relationships with businesses during the financial period as indicated below:

- Department of Higher Education and Training (DHET)

- All Sectorial Education and Training Authorities (SETA’s) - National Skills Fund (NSF)- National Student Financial Aid Scheme (NSFAS) - Other colleges

61

GovernmentGrants

R

Skills TrainingR

LearnershipsR

Outstanding Balances

R

45.2 Income Received from Related Parties

During the year the income was received from the following Related Parties that are related to the college as indicated:

For the Year ended 31 December 2018Department of Higher Education and Training (DHET)National Skills Fund (NSF)BANKSETACATHSSETACETACHIETAETDP SETAEWSETAFP&M SETAMERSETANorthlink CollegePSETAServices SETAW&R SetaCommunity Colleges (CLC)Total Income

For the Year ended 31 December 2017Department of Higher Education and Training (DHET)National Skills Fund (NSF)BANKSETACATHSSETACETACHIETAETDP SETAEWSETAFP&M SETANorthlink CollegePSETAServices SETAW&R SetaCommunity Colleges (CLC)South Cape CollegeTotal Income

132,730,7725,026,902

----

--

-

593,5003,068,600

141,419,774

123,356,804---------

2,670,575

126,027,379

-

--

-387,500

-

-

-387,500

-

--

67,2001,430,625

---

81,900

-

1,579,725

-277,500

----

660,000-

232,840156,029

- 336,396

1,428,000-

3,090,765

19,022,333-

1,500----

631,040-

429,957-

20,084,830

9,159,149691,872

-8,992

--

479,000-

174,1883,521

-119,040876,831

11,512,593

12,383,341

-8,992

93,57970,90039,00073,500

366,4003,521

550,306258,257

13,847,796

Compensation of KeyManagement Personnel

BasicR

BonusR

Long-term Benefits

R

Termination Benefit

R

TotalR

D E C E M B E R 2 0 1 8Johanna CoetzeeCorrie MyburghIzak GelderblomEbrahim PetersWendy AdamsChristiana NealDanny Plaatjies

D E C E M B E R 2 0 1 7Johanna CoetzeeCorrie MyburghIzak GelderblomEbrahim PetersWendy AdamsChristiana Neal

653,153-

676,143690,664619,004515,912477,464

3,632,340

603,986323,272607,220617,918541,078268,756

2,962,230

64,228 -

77,841122,529

76,47892,83737,058

470,972

---

52,38440,65240,987

134,023

241,888-

271,150125,183143,871

67,05756,928

906,077

112,21490,436

256,84534,62961,643

555,768

-

29,002---

29,002

-295,836

---

295,836

959,26929,002

1,025,134938,376839,353675,806571,450

5,038,391

716,200709,544864,065704,932643,373309,743

3,947,858

45.3 Compensation of Related Parties

Compensation of Key Management Personnel and Councillors is set out in Notes 19, and below, Statement of Remuneration of Management, to the Annual Financial Statements.

Bonuses for Mrs Coetzee and Mr Gelderblom is paid out as part of monthly package.

62

2018R

2017R

D E C E M B E R 2 0 1 8Compensation of CouncilBleazard, DBurton, MRCloete, HCAKabanyane, GCLingela, TSMacMaster, LLMMatolengwe, NMdludlu, MVan der Merwe, HAVan Louw, CL

D E C E M B E R 2 0 1 7Compensation of CouncilBleazard, DCloete, HCAKabanyane, GCLingela, TSOlivier, AVan der Merwe, HAvan Louw, CL

65,72219,78319,29919,62147,013

7,9474,979

23,68545,037

7,521260,607

27,16113,97116,09527,90114,99628,08314,866

143,074

4 6 . C O N T I N G E N T A S S E T S

2018R

2017R

The college was not engaged in any transaction or event during the year under review involving Contingent Assets.

46.1 Insurance Claims:

(i) Lost / Damaged Assets(ii) Staff life insurance

- 115,504

15,504100,000

4 7 . E V E N T S A F T E R T H E R E P O R T I N G DA T E

No events having financial implications requiring disclosure occurred subsequent to 31 December 2018.

4 8 . G O I N G C O N C E R N A S S E S S M E N T

Management considered the following matters relating to the Going Concern:

(i) The Council adopted the 2019 Budget. This is sufficient to support the ongoing delivery of educational service to students.

(ii) DHET’s grant allocation is expected to increase based on the increased FTE’s being registered and therefore sufficient funding would be available for the following year.

(iii) Strict daily cash management processes are embedded in the college’s operations to manage and monitor all actual cash inflows and cash outflows in terms of the cash-flow forecast supporting the Budget. The cash management processes is complemented by monthly and quarterly reporting, highlighting the actual cash position, including the associated risks and remedial actions to be instituted.

Taking the aforementioned into account, management has prepared the Annual Financial Statements on the Going Concern Basis.

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