A FULL MEMBER OF PAFA AGM...of Accountants (PAFA). You will find the annual financial statements of your Institute which reflect a healthy, stable, liquid Institute. I do, however,

12 October 2018

INSTITUTE OF ACCOUNTING & COMMERCE

your future secured

2017 ANNUAL REPORT

91st AGM

1 J a n u a r y 2 0 1 7 t o 3 1 D e ce m b e r 2 0 1 7

A FULL MEMBER OF PAFA

Annual Report

Contents

1 January 2017 to 31st December 2017

1

2

3

8

10

13

32

32

Notice of AGM and Agenda

Notice of Board Meeting and Agenda

Minutes of the 90th AGM

President’s Report

CEO’s Report

Financial Statements

Directors and Regional Committee Members

IAC Staff Members

Page

In terms of Article 10 of the Institute’s Memorandum of Incorporation

Notice of the Ninety First (91st) Annual General MeetingOf

The Institute of Accounting and Commerce

(Formerly the Institute of Administration and Commerce)

is served

DATE: 12 October 2018

VENUE: Saint George Hotel - 58 Goede Hoop Avenue, Doornkloof (Irene)

TIME: 15:00 – 17:00

1. Welcome 2. Apologies 3. Notice of meeting 4. Confirmation of Minutes of the 90th Annual General Meeting 5. President’s Report 2017 / 2018 6. Chief Executive Officer’s Report 2017 / 2018 7. Audited Annual Financial Statements for the year ended 31/ 12/ 2017 8. Appointment of Auditors 10. Election and induction of directors to the IAC Board 2017/201811. Closure12. Social with refreshments

By order the President.

Mr. A.W. Bezuidenhout

1


your future secured

AGENDA

Proposed amendments to the IAC MOI (Constitution) (Per clause 25 of the MOI)9.

Notice is hereby given for a Board Meeting

Of

The Institute of Accounting and Commerce(Formerly the Institute of Administration and Commerce)

is served

DATE: 12 October 2018

VENUE: Saint George Hotel - 58 Goede Hoop Avenue, Doornkloof (Irene)

TIME: Immediately after the AGM

1. Election of Officials:

• President

• Vice President

By order:

E. Nagia

CEO (Chief Executive Officer)

2


your future secured

AGENDA

Minutes of the 90th Annual General Meeting Of the

Institute of Accounting & Commerce Destiny Exclusive Hotel, Kempton Park, Gauteng

Friday 13 October 2017

Present:

Board of Directors Mr. A. Bezuidenhout (President) Mr. M. Biermann (Vice President) Mr. D. Johnstone (Immediate Past President) Mr. D. Swanepoel Mr. S. Tassiem Mr. T. Mzwakali Mr. S. Cupido Ms. J. Lubbe Honourable Mr. P. Chiota (President – IAC Zim) Ex Officio Mr. E. Nagia CEO (SA) Mr. J. Dube CEO (Zim) Members Present 1. Stefan Olivier 655048 8. Donaven Mungal 651343 2. Manjeev Shrivastav 623522 9. Elphas Sithole 9035983. Philoxenia Chatindo 655407 10. Ntombikhaya Mamba 655122 4. Blessings Moyo 655335 11. Colinn Alberts 611508 5. Michael Qvist 655258 12. Elone Nkuna 653363 6. Hetisani Makhubela 653662 13. Hermann Kouame 655427

841016 .7 Guests: 1. Cleo Radebe 6. Granville Shenker 2. Maputi Sesati 7. Huida Shenker 3. Busisiwe Ngwenya 8. Vis Naidoo 4. Lefaria Kinimi 9. Andre Badenhorst 5. Earl Steyn 10. Lebo Jantjie

3

Prakash Singh

1. Welcome The President (Mr. A. Bezuidenhout) opened the meeting at 15h00 and extended a warm welcome to all members and guests. The meeting was declared valid, as a quorum was present (as required by Article11.2 of the Memorandum of Incorporation). 2. Apologies Apologies were received from the following members: 1. Sybil Lesar-Gonsalves 655106 11. Brett Walters 654207 2. James Mentor 277568 12. Sandy Power 633876 3. Antonio Del Cuore 628592 13. Samareshni Reddy 655456 4. Muhammad Asmal 655069 14. Theodorus Herselman 654595 5. Andre October 652422 15. Melanie Telleman 612364 6. Vic De Valdorf 633546 16. Stanley Evans 264954 7. Mark Walsh 653353 17. Susan Densem 654864 8. Ruth Reed 047066 18. Michael Hands 640665 9. Leatitia Van Der Walt 655095 19. Dean Wingrin 623600 10. Proxies: Proxies in favour of the following persons were received and tabled in terms of Article 13.2 and 13.3 of the Memorandum of Incorporation:

• Mr. M. Biermann 3 • Mr. E. Nagia 2 • Mr. A. Bezuidenhout 4 • Mr. S. Cupido 5 • Mr. T. Mzwakali 1

Total Proxies received 15

4

Gavin Maskell 654581

3. Notice of meeting:

IAC AGM Notice 2017:

Notice of the meeting was electronically circulated to all members as follows:

The AGM booklets were posted on the 8th of September 2017.

4. Confirmation of Minutes of the 89th Annual General Meeting

The minutes of the 89th AGM was published in the AGM booklet. The AGM took place on the 21st October 2016 and was held in Cape Town at the Protea Hotel in Sea Point.

Proposal that the minutes of the 89th Annual General Meeting of the Institute (held on 21 October 2016)were circulated and is a true reflection of the meeting.

Proposer: Mr. M. Biermann Seconder: Mr. S. Tassiem

5. President’s Report for 2016 / 2017The President tabled and read out his report for 2016/2017. The report was circulated to all members together with the notice of the AGM.

The President’s report for 2016/2017 was tabled and adopted.

Proposer: Mr. M. Biermann Seconder: Mr. S. Cupido

6. CEO’s Report for 2016 / 2017

The CEO tabled and read out his report for 2016/2017. The report was circulated to all members together with the notice of the AGM.

The CEO’s report for 2016/2017 was tabled and adopted

Proposer: Mr. M. Biermann Seconder: Ms. J. Lubbe

5

IAC AGM Bulk Mailshots to Members 2017

Mailshot ContentAGM Notice, Enomination Letter, Nomination Letter Form, Proxy FormAGM Notice, Enomination Letter, Nomination Letter Form, Proxy FormAGM Notice, Enomination Letter, Nomination Letter Form, Proxy FormAGM Notice, Proxy FormAGM Notice, Proxy FormAGM Notice, Proxy FormAGM Notice, Proxy FormAGM Notice, Proxy FormAGM Notice, (Venue address details)AGM Notice, Proxy Form (Venue address details)AGM Notice, Reminder re closing date & time for proxy Forms

Date Mailed28 - 08 - 1704 - 09 - 1711 - 09 - 1715 - 09 - 1720 - 09 - 1729 - 09 - 1704 - 10 - 1704 - 10 - 1706 - 10 - 1709 - 10 - 1709 - 10 - 17

Time14:5508:4509:4009:0010:4514:0007:5614:0009:3408:2508:25

Sent812812813737813668813813813740813

Delivered784793796716785663809705799731778

Opened187157181130177121158170175134154

All agreed

6

The Chairman requested that the meeting pause to pay respects to those members of the IAC that has passed on in the year by observing a minute of silence . The meeting obliged.

7. Audited Financial Statements for the year ended 31 December 2016

The audited financial statements were tabled. The financial statements were circulated to all members togetherwith a notice of the AGM.

Proposed: Mr. M. Biermann Seconded: Mr. T. Mzwakali

That the unqualified audited financial statements be accepted.

All agreed.

8. Appointment of Auditors

The Board recommended that we continue with the current Auditors, A2A Kopano, for the next year.

Proposed: Mr. M. Shrivastav Seconded: Mr. M. Biermann

9. Elections and Induction of Directors to the IAC Board for 2017 / 2018

Mr. Nagia reported:

• Nominations for members to serve as Directors on the IAC Board (in terms of Article 15 of the Memorandum of Incorporation) were circulated from the 28th August 2017 (7 weeks) prior to the AGM.

• This is in compliance with Article 20.2 of the Memorandum of Incorporation, which states that one months notice needs to be served.

• Nominations for the following persons to serve on the Board for the 2017 / 2018 year were received.

Mr. A.W. Bezuidenhout Mr. D. Johnstone Mr. D.W. Swanepoel Mr. M.S. Tassiem

• Nominations from the following Regions were received for members to serve as Directors on

the IAC Board for the 2017 / 2018 year:

Mr. C. Alberts Gauteng Mr. S. T. Cupido Western Province Ms. J. M. J. Lubbe Free State Mr. T. Mzwakali Eastern Province Honourable Mr. P. Chiota Zimbabwe

Board Proposed: Mr. M. Biermann Seconded: Mr. M. Qvist

All Agreed

Election of Office Bearers

The Secretariat, Mr. E Nagia, announced the Office Bearers of the IAC Board for 2017 / 2018 as elected by the New Board:

• President: Mr A.W. Bezuidenhout• Vice President: Mr S.T. Cupido • Immediate Past President: Mr. D. Johnstone

They will form part of the EXCO Committee of the IAC Board for 2017 / 2018.

All nominees accepted their nomination and were inducted as Directors by accepting the oath of office which was read out by Mr. C. Alberts on behalf of all incumbent Directors.

10. Closure

There being no further matters raised, the President declared the meeting closed at 16h00.

7

President Date 31 August 2018

8

Report of the President to the 91st Annual General Meeting

It is my honour to once again give you an overview of this Institute, which has a rich and diverse historyof achievements over many years. It is because of the fact that it belongs to you, the Institute has stood the test of time, and has achieved everything it has with the support of you the members.

I am also proud to announce that the IAC was audited by CIPC, and was given an all clear audit report, we also received our SAQA professional body status renewal after the full audit that I reported at last year’s AGM.

The Institute has also been upgraded from an associate member to a full member of Pan African Federation of Accountants (PAFA).

You will find the annual financial statements of your Institute which reflect a healthy, stable, liquid Institute. I do, however, again take this opportunity to request that members and regions help the institute to grow its membership, as a director said a few years ago if each member just introduced one new member we would increase our membership by double. If we are not able to increase and maintain membership it will not be possible for the office to produce these types of results going forward. I would like to thank the CEO for running such a tight ship.

MembershipAs I reflect on each year’s membership figures I again would like to thank those members who continue to becompliant and also encourage other members to become in terms of CPD requirements. This year we saw the introduction of the one day conference organised and held by the IAC in the Western Cape and Gauteng, and I would like to thank the IAC staff and the IAC director for all the work that went into making this a success.

It is with great pleasure that your Institute has maintained its relationship with the controlling bodies such as SARS, CIPC etc and it is certainly the intention to continue on this path. Because you, the members, have kept up to datewith the CPD requirements and the uploading of your CPD hours, I can say that we have once again received our CIPC compliance certificate . We also underwent a SARS audit on members CPD compliance as registered Tax Practitioners, and have not had any negative feedback.

As in the past, a number of universities have been visited during the past year, planting the seeds of the IAC, not only with the students but with the academic staff as well. I would like to thank the staff of the IAC fortheir efforts in this respect.

BoardCurrently, your board comprises of eight directors from South Africa,

The board elected at the 2017 AGM was made up as follows:

Mr. A. W. Bezuidenhout President ElectedMr. S.T. Cupido Vice President Chairman Western CapeMr. D. M. Johnstone Immediate Past PresidentMr. T. Mzwakali Chairman Eastern CapeMrs. J.M.J. Lubbe Chairman Free StateMr. C. Alberts Chairman GautengMr. M.S. Tassiem CPD Coordinator ElectedMr. D.W. Swanepoel Elected

9

The MOI requires that the Institute be managed by a board of directors made up of members. It requires thatthree directors are chosen from the general membership and that five be chosen by the regional committees. This is a very acceptable democratic process but like all democratic processes it has some short comings. The MOI expects (without mentioning it) that directors be persons of integrity, future thinkers and would put the interest of the Institute first before any personal gains or ambitions.

To each of the above directors, please accept my very sincere appreciation for all your loyalty, support, input and your dedication and total commitment to the IAC.

Annual General Meeting The Annual General Meeting of the Institute of Accounting and Commerce (IAC) will be held at Saint George Hotel,

Irene on the 12th October 2018 at 15:00 pm.

The notice of the AGM is enclosed with this report.

Future

Having been accepted by PAFA as a full member we now are able to prepare for the application to become members of IFAC. Our commitment remains to be the focused body which you are a member of, by thinking ahead, planning, maintaining the standards which have been set and primarily being of service and support to you, the member.

Vote Of Thanks

I would like to thank the Chief Executive Officer and the staff of the Institute for all their hard work and efforts over the past year.

The Board, as in the past, I am sure will be determined to do everything in its power during 2018 / 2019 to keep the IAC firmly established on the road of being a major role player in the industry, and making the IAC your future.

In closing I would like to express my heartfelt thanks to both past and present board members, members of the IAC and the IAC staff for all the support, guidance and encouragement that I have received over the last year.

,

I would like to leave you with the following sayings:

“Individual commitment to a group effort that is what makes a team work, a company work, a society work, a civilization work.” ~ Vince Lombardi

“Don't work for recognition, but do work worthy of recognition.” ~ H. Jackson Brown, Jr

Andrew Wayne BezuidenhoutPresident31 August 2018

Andrew Wayne Bezuidenhout - IAC President

10

Report of the Chief Executive Officeto the 91st Annual General Meeting

Introduction Welcome to the 91st Annual General Meeting of the IAC, nine more years before we celebrate our centennial anniversary.

Membership

Even though the membership numbers have stabilised and we saw a small increase in our numbers this year we still however do not have sufficient numbers in the 25 to 45 age group.

Once again we were forced to terminate the membership of a number of members due to the non payment of subscription fees. Fortunately the number of members who were non compliant with the CPD requirements have decreased considerably.

Recognition of the IAC

Last year I reported that the Board has agreed to apply for full membership of the Pan African Federation of Accountants (PAFA). I am happy to report that our application was successful and we obtained full PAFA membership on 23 March 2018.

As you are aware the institute has been accredited by CIPC to licence Business Rescue Practitioners

(BRP). Unfortunately the institute was not able to set the requirements for BRP as yet but it is hoped that we will be able to do this before the end of the year.

One of the problems that we encountered was that our professional indemnity insurance did not cover BRP. We

were fortunate to renegotiate with our previous broker’s viz. AON who will now cover BRP. You will also note that we managed to negotiate a lower premium for a higher cover as well as cover for our members who reside outside of South Africa (with the exception of the United States)

Communication

Our new website has been up and running for more than a year now and I trust that you find the look and feel to be more appealing and easier to navigate. Any comments on how we can improve this will be most welcome.

We continue to supply you with our daily and weekly email notifications and our updates via the social media platforms. Thank you to all those members for their input and responses in this regard. Please continue to interact with us.

There has also been a big improvement in the number of practice groups and monthly forums put together by our regional committees. My sincere thanks to Mr Tabile Mzwakali and the Eastern Cape Committee, Mr Colinn Alberts, Mr Riaan Badenhorst, Theadora Lombard and the Gauteng Committee, and Shawn Cupido and the Cape Town Committee for hosting these events.

This year Shafiek Tassiem held two conferences, one in Cape Town on 21 June 2018 and one in Johannesburg on 23 July 2018. Both events were very successful and we congratulate Shafiek on another well run conference.

This was the first year that the conference was held in Johannesburg and we received a number of compliments from members on the quality of the speakers and the overall administration of the conference. A special thank you to Riaan Badenhorst, Theadora Lombard, Ana De Abreu and Sylvia Bruton for all their assistance at the event which contributed to the success thereof.

11

Thanks must also be given to Mr Andrew Bezuidenhout and Shane Webb for continuing to host the affordable webinars and to Engela for her dedication in producing our bi - monthly magazine,“The Professional”.

Continuous Professional Development (CPD)CPD requirements

CPD refers to on going post qualification development aimed at refreshing, updating a and developing knowledge and skills of professionals.

Our members are required to be competent to carry out their duties and responsibilities and therefore

have a

duty to maintain a high level of professional knowledge and skills required to carry out their work in accordance with all relevant laws, regulations, technical and professional standards applicable to that work.

All members must

comply with the institute’s annual CPD requirements (1 January -

31 December) of which a minimum of 50% must be structured and the balance can be unstructured.

.

Structured CPD hours can be obtained by attending courses, seminars and lectures and by performing research and

or writing technical articles. Attending the monthly IAC practice

groups also counts towards structured CPD hours. Unstructured CPD hours can be obtained by reading technical and business literature, including the IAC’s newsletter, “The Professional”.

Finance

Audit report 2017

Attached in this annual report please find the audited financial statements for the year ended 31 December 2017

from our auditors A2A Kopano Incorporated.

We once again

achieved an unqualified audit report for 2017. I must stress that I do not see this as an achievement as this is what should be expected from an accounting institute.

Even though we budgeted for a loss of R1 692 426

we managed to control our expenses and ended with a small profit of R64 835

.

Breaking even or making a small profit is becoming more difficult without increasing our income from membership. Growing

our membership is not only the responsibility of the Board or the Secretariat. It is the responsibility of every member.

I therefore appeal to all members to assist us to grow the membership. If each member can only introduce one new member to the institute, we can double our membership in a very short space of time. This will allow us to operate profitably without having to increase the subscription fees by the percentages that we are forced to at this stage. I wish to express my thanks and appreciation to my staff and all concerned for achieving this result.

Appreciation

I once again wish to extend my appreciation to all Board members, IAC staff and you the members, for your guidance and support over the past years. You have all contributed to making this Institute great and it is an honour and privilege to have been able to serve you.

Conclusion

As always I leave you with these pearls of wisdom: “The human voice can never reach the distance covered by the still, small voice of conscience.”

Gandhi.

“There are 7 things that will destroy us:

- Wealth without work - Pleasure without conscience - Knowledge without character - Religion without sacrifice - Politics without principle - Science without humanity - Business without ethics”

Gandhi . I once again thank you all for your support of me and the institute and giving me the opportunity to serve you

.

Yours sincerely, Ehsaan Nagia - Chief Executive Officer

12

The Institute of Accounting and Commerce NPC(Registration number 1981/011981/08)

Annual Financial Statementsfor the year ended 31 December 2017

A2A Kopano Inc.Chartered Accountants (S.A.)

Registered AuditorPublished 02 March 2018

13


your future secured

General Information

Country of incorporation and domicile South Africa

Nature of business and principal activities A professional body engaged in certifying accounting officers, tax practitioners and independent reviewers

Directors Andrew Wayne Bezuidenhout

Colinn Peter Alberts Daryl Wade Swanepoel Derek Michael Johnstone Johanna Magrieta Jacoba Lubbe Mogamat Shafiek Tassiem Shawn Thomas Cupido Tabile Mzwakali

Registered office 252 Rosmead Avenue Wynberg Cape Town 7780

Business address 252 Rosmead Avenue Wynberg Cape Town 7780

Postal address P. O. Box 36477 Glosderry 7702

Auditors A2A Kopano Inc. Chartered Accountants (S.A.) Registered Auditor

Company registration number 1981/011981/08

Tax reference number 9390/063/03/01

Level of assurance These annual financial statements have been audited in compliancewith the applicable requirements of the Companies Act 71 of 2008.

Preparer The annual financial statements were internally compiled by: Valencia Williams

Published 02 March 2018


Annual Financial Statements for the year ended 31 December 2017

14

Index

The reports and statements set out below comprise the annual financial statements presented to the members:

Index Page

Independent Auditor's Report 16 - 17

Directors' Responsibilities and Approval

Directors' Report 19

Statement of Financial Position 20

Statement of Comprehensive Income 21

Statement of Changes in Equity 22

Statement of Cash Flows 23

Accounting Policies 24 - 26

Notes to the Annual Financial Statements 26 - 30

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

Detailed Income Statement 31

Level of assurance

These annual financial statements have been audited in compliance with the applicable requirements of the Companies Act 71 of 2008.

Preparer

Valencia Williams

Published

02 March 2018

15



18

Independent Auditor's Report

To the members of The Institute of Accounting and Commerce NPC

OpinionWe have audited the annual financial statements of The Institute of Accounting and Commerce NPC set out on pages 7 to 17, which comprise the statement of financial position as at 31 December 2017, and the statement of comprehensive income, statement of changes in equity and statement of cash flows for the year then ended, and notes to the annual financial statements, including a summary of significant accounting policies. In our opinion, the annual financial statements present fairly, in all material respects, the financial position of The Institute of Accounting and Commerce NPC as at 31 December 2017, and its financial performance and cash flows for the year then ended in accordance with the International Financial Reporting Standard for Small and Medium sized Entities and the requirements of the Companies Act 71 of 2008.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the annual financial statements section of our report. We are independent of the company in accordance with the Independent Regulatory Board for Auditors Code of Professional Conduct for Registered Auditors (IRBA Code) and other independence requirements applicable to performing audits of annual financial statements in South Africa. We have fulfilled our other ethical responsibilities in accordance with the IRBA Code and in accordance with other ethical requirements applicable to performing audits in South Africa. The IRBA Code is consistent with the International Ethics Standards Board for Accountants Code of Ethics for Professional Accountants (Parts A and B) . We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Other information

The directors are responsible for the other information. The other information comprises the Directors' Report as required by the Companies Act 71 of 2008 and the Detailed Income Statement which we obtained prior to the date of this report. Other information does not include the annual financial statements and our auditor's report thereon.

Our opinion on the annual financial statements does not cover the other information and we do not express an audit opinion or any form of assurance conclusion thereon.

In connection with our audit of the annual financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the annual financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the work We have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of the directors for the Annual Financial Statements

The directors are responsible for the preparation and fair presentation of the annual financial statements in accordance with the International Financial Reporting Standard for Small and Medium Sized Entities and the requirements of the Companies Act 71 of 2008, and for such internal control as the directors determine is necessary to enable the preparation of annual financial statements that are free from material misstatement, whether due to fraud or error.

16

In preparing the annual financial statements, the directors are responsible for assessing the company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the Annual Financial Statements

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

As part of an audit in accordance with International Standards on Auditing, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the annual financial statements, whether due to fraud orerror, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient andappropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud ishigher 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 areappropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of thecompany’s internal control.

Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates andrelated disclosures made by the directors.

Conclude on the appropriateness of the directors' use of the going concern basis of accounting and based on theaudit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significantdoubt on the company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, weare required to draw attention in our auditor's report to the related disclosures in the annual financial statements or, ifsuch disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained upto the date of our auditor's report. However, future events or conditions may cause the company to cease to continueas a going concern.

Evaluate the overall presentation, structure and content of the annual financial statements, including the disclosures,and whether the annual financial statements represent the underlying transactions and events in a manner thatachieves fair presentation.

We communicate with the directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

A2A Kopano Inc.

Moegamat Stenekamp

Director

Registered Auditor

02 March 2018

Unit F4

F6

Century Square

Heron Crescent

Century City

7446

Independent Auditor's Report

17

Directors' Responsibilities and Approval

The directors are required by the Companies Act 71 of 2008, to maintain adequate accounting records and are responsiblefor the content and integrity of the annual financial statements and related financial information included in this report. It is their responsibility to ensure that the annual financial statements fairly present the state of affairs of the company as at the end of the financial year and the results of its operations and cash flows for the period then ended, in conformity with the International Financial Reporting Standard for Small and Medium sized Entities. The external auditors are engaged to express an independent opinion on the annual financial statements.

The annual financial statements are prepared in accordance with the International Financial Reporting Standard for Small and medium sized Entities and are based upon appropriate accounting policies consistently applied and supported by reasonable and prudent judgements and estimates.

The directors acknowledge that they are ultimately responsible for the system of internal financial control established by the company and place considerable importance on maintaining a strong control environment. To enable the directors to meet these responsibilities, the board of directors sets standards for internal control aimed at reducing the risk of error or lossin a cost effective manner. The standards include the proper delegation of responsibilities within a clearly defined framework, effective accounting procedures and adequate segregation of duties to ensure an acceptable level of risk. These controls are monitored throughout the company and all employees are required to maintain the highest ethical standards in ensuring the company’s business is conducted in a manner that in all reasonable circumstances is above reproach.

The focus of risk management in the risk cannot be fully eliminated, the company endeavours to minimise it by ensuring that appropriate infrastructure, controls, company is on identifying, assessing, managing and monitoring all known forms of risk across the company. While operating systems and ethical behaviour are applied and managed within predetermined proceduresand constraints.

The directors are of the opinion, based on the information and explanations given by management, that the system of internalcontrol provides reasonable assurance that the financial records may be relied on for the preparation of the annual financialstatements. However, any system of internal financial control can provide only reasonable, and not absolute, assurance againstmaterial misstatement or loss.

The directors are satisfied that the company has access to adequate resources to continue in operational existence for theforeseeable future.

The external auditors are responsible for independently auditing and reporting on the company's annual financial statements.The annual financial statements have been examined by the company's external auditors and their report is presented onpage 3.

The annual financial statements set out on pages 6 to 18, which have been prepared on the going concern basis, wereapproved by the board of directors on 02 March 2018.

Andrew Wayne Bezuidenhout

Shawn Thomas Cupido

Mogamat Shafiek Tassiem

Cape Town

18



Andrew Wayne Bezuidenhout

Mogamat Shafiek Tassiem Shawn Thomas CupidoCape Town

Signed on behalf of the Board of Directors By:

Directors' Report

The directors have pleasure in submitting their report on the annual financial statements of The Institute of Accounting and Commerce NPC for the year ended 31 December 2017.

1. Nature of business

The Institute of Accounting and Commerce NPC is engaged to promote actively, the effective utilisation and development of qualified manpower, through the achievement of the highest standards of professional competence and ethical conduct amongst its members and operates principally in South Africa.

There have been no material changes to the nature of the company's business from the prior year.

2. Review of financial results and activities

The annual financial statements have been prepared in accordance with the International Financial Reporting Standard for Small and Medium Sized Entities and the requirements of the Companies Act 71 of 2008. The accounting policies have been applied consistently compared to the prior year.

Full details of the financial position, results of operations and cash flows of the company are set out in these annual financial statements.

3. Directors

The directors in office at the date of this report are as follows:

Directors Changes Andrew Wayne Bezuidenhout Colinn Peter Alberts Appointed 13 October 2017 Daryl Wade Swanepoel Derek Michael Johnstone Appointed 13 October 2017 Johanna Magrieta Jacoba Lubbe Micheal Alois Rudolf Biermann Resigned 13 October 2017 Mogamat Shafiek Tassiem Shawn Thomas Cupido Tabile Mzwakali

4. Property, plant and equipment

There was no change in the nature of the property, plant and equipment of the company or in the policy regarding their use.

At 31 December 2017 the company's investment in property, plant and equipment amounted to R1,187 (2016: R4,931), of which R3,596 (2016: R15,509) was added in the current year through additions.

5. Events after the reporting periodThe directors are not aware of any material event which occurred after the reporting date and up to the date of this report.

6. Going concern

The directors believe that the company has adequate financial resources to continue in operation for the foreseeable future and accordingly the annual financial statements have been prepared on a going concern basis. The directors have satisfied themselves that the company is in a sound financial position and that it has access to sufficient borrowing facilities to meet its foreseeable cash requirements. The directors are not aware of any new material changes that may adversely impact the company. The directors are also not aware of any material noncompliance with statutory or regulatory requirements or of any pending changes to legislation which may affect the company.

7. Auditors

A2A Kopano Inc. will continue in office as auditors of the company for the next financial period.

8. Secretary

The company had no secretary during the year under review.

19



Statement of Financial Position as at 31 December 2017

Figures in Rand

Notes

2017

2016

AssetsNonCurrent AssetsProperty, plant and equipment 2 1,187 4,931Other financial assets 3 701,242 525,834

702,429 530,765

Current AssetsInventories 4 8,200 9,681Trade and other receivables 5 17,238 40,896Cash and cash equivalents 6 8,915,507 8,881,807

8,940,945 8,932,384

Equity and LiabilitiesEquity

Accumulated surplus 7,443,708 7,400,390Bursary reserve fund 352,555 331,038

7,796,263 7,731,428

Total Assets 9,643,374 9,463,149

LiabilitiesCurrent LiabilitiesTrade and other payables 7 1,847,111 1,731,721

Total Equity and Liabilities 9,643,374 9,463,149

20



Statement of Comprehensive Income

Figures in Rand

Notes

2017

2016

Revenue 8 2,768,971 2,521,309 Other income 9 313,134 181,037 Operating expenses (3,839,304) (3,890,456)

Operating (deficit) 10 (757,199) (1,188,110) Investment revenue 11 646,626 619,368 Fair value adjustments 12 175,408 18,396

Surplus (deficit) for the year 64,835 (550,346)

21



Statement of Changes in Equity

Figures in Rand Bursary

Reserve Fund Accumulated

Surplus Total equity

Balance at 01 January 2016

313,186

7,968,588

8,281,774

Deficit for the year

-

(550,346)

(550,346)

Transfer between reserves

17,852

(17,852)

-

Balance at 01 January 2017

331,038

7,400,390

7,731,428

Surplus for the year

-

64,835

64,835

Transfer between reserves

21,517

(21,517)

-

Balance at 31 December 2017

352,555

7,443,708

7,796,263

22



Statement of Cash Flows

Figures in Rand

Notes

2017

2016

Cash flows from operating activities

Cash used in operations 13 (609,330) (1,091,770) Interest income 624,979 598,553 Dividends received 21,647 20,815

Net cash from operating activities

37,296

(472,402)

Cash flows from investing activities

Purchase of property, plant and equipment

2

(3,596)

(15,509)

Total cash movement for the year

33,700

(487,911)

Cash at the beginning of the year 8,881,807 9,369,718

Total cash at end of the year 6 8,915,507 8,881,807




your future secured

23

Accounting Policies

1.

Presentation of annual financial statements

The annual financial statements have been prepared in accordance with the International Financial Reporting Standard for Small and Medium Sized Entities, and the Companies Act 71 of 2008. The annual financial statements have been prepared on the historical cost basis, and incorporate the principal accounting policies set out below. They are presented in South African Rand.

.

These accounting policies are consistent with the previous period.

1.1

Property, plant and equipment

Property, plant and equipment are tangible items that are held for use in the production or supply of goods or services, or for rental to others or for administrative purposes; and are expected to be used during more than one period.

Property, plant and equipment is carried at cost less accumulated depreciation and accumulated impairment losses.

Cost include costs incurred initially to acquire or construct an item of property,plant and equipment and costs incurredsubsequently to add to, replace part of, or service it. If a replacement cost is recognised in the carrying amount of an item of property, plant and equipment, the carrying amount of the replaced part is derecognised.

-

Depreciation is provided using the straight line method to write down the cost, less estimated residual value over the useful life of the property, plant and equipment as follows:

Item

Depreciation method

Average useful life

Furniture and fixtures

Straight line

6 years

IT equipment

Straight line

3 years

Office equipment

Straight line

3 years

Security equipment

Straight line

5 years

Property, plant and equipment acquired at a cost of less than R7,000 per item may be written off in full during the year ofacquisition.

Gains and losses on disposals are recognised in profit or loss.

1.2

Financial instruments

Initial measurement

Financial instruments are initially measured at the transaction price (including transaction costs except in the initial measurement of financial assets and liabilities that are measured at fair value through profit or loss) unless the arrangement constitutes, in effect, a financing transaction in which case it is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.

Financial instruments at amortised cost

These include loans, trade receivables and trade payables. Those debt instruments which meet the criteria in section 11.8(b) of the standard, are subsequently measured at amortised cost using the effective interest method. Debt instruments whichare classified as current assets or current liabilities are measured at the undiscounted amount of the cash expected to be received or paid, unless the arrangement effectively constitutes a financing transaction.

At each reporting date, the carrying amounts of assets held in this category are reviewed to determine whether there is any objective evidence of impairment. If there is objective evidence, the recoverable amount is estimated and compared with the carrying amount. If the estimated recoverable amount is lower, the carrying amount is reduced to its estimated recoverable amount, and an impairment loss is recognised immediately in profit or loss.

Financial instruments at cost

Equity instruments that are not publicly traded and whose fair value cannot otherwise be measured reliably are measured at cost less impairment.

24



1.2 Financial instruments (continued)

Financial instruments at fair value

All other financial instruments, including equity instruments that are publicly traded or whose fair value can otherwise be measured reliably, are measured at fair value through profit and loss.

1.3 Tax

Tax expenses No provision has been made for 2017 tax as the company is exempt from tax in terms of section 10(1)(cN) of the Income Tax Act.

1.4 Leases

A lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership to the lessee. All other leases are operating leases.

Operating leases

Operating lease payments are recognised as an expense on a straight line basis over the lease term unless:another systematic basis is representative of the time pattern of the benefit from the leased asset, even if the payments are not on that basis, orthe payments are structured to increase in line with expected general inflation (based on published indexes or statistics) to compensate for the lessor’s expected inflationary cost increases.

Any contingent rents are expensed in the period they are incurred.

1.5 Inventories

Inventories are measured at the lower of cost and estimated selling price less costs to complete and sell, on the first in, first out (FIFO) basis.

1.6 Impairment of assets

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

If there is any such indication, the recoverable amount of any affected asset (or group of related assets) is estimated and compared with its carrying amount. If the estimated recoverable amount is lower, the carrying amount is reduced to its estimated recoverable amount, and an impairment loss is recognised immediately in profit or loss.

If an impairment loss subsequently reverses, the carrying amount of the asset (or group of related assets) is increased to the revised estimate of its recoverable amount, but not in excess of the amount that would have been determined had no impairment loss been recognised for the asset (or group of assets) in prior years. A reversal of impairment is recognised immediately in profit or loss.

1.7 Employee benefits

Short term employee benefits

The cost of short term employee benefits, (those payable within 12 months after the service is rendered, such as leave pay andsick leave, bonuses, and non monetary benefits such as medical care), are recognised in the period in which the service is rendered and are not discounted.

1.8 Provisions and contingencies

Provisions are recognised when the company has an obligation at the reporting date as a result of a past event, it is probablethat the company will be required to transfer economic benefits in settlement; and the amount of the obligation can be estimated reliably.

25

Accounting Policies



1.2 Financial instruments (cont.)

Notes to the Annual Financial Statements

Figures in Rand

2.

Property, plant and equipment

2017

2016

Cost

Accumulated depreciation

Carrying value

Cost

Accumulated depreciation

Carrying value

-

Furniture and fixtures

80,510

(80,510)

-

80,510

(80,510)

- IT equipment

93,149

(93,149)

-

91,569

(91,569)

- Office equipment

109, 850

(109, 850)

107,834

(105,673)

2,161

Security equipment

17,133

(15,946)

1,187

17,133

(14,363)

2,770

Total

300,642

(299,455)

1,187

297,046

(292,115)

4,931

Reconciliation of property, plant and equipment - 2017

IT equipment

Office equipment

Security equipment

1.9

Revenue

Revenue is recognised to the extent that the company has transferred the significant risks and rewards of ownership of goods to the buyer, or has rendered services under an agreement provided the amount of revenue can be measured

reliably and it is probable that economic benefits associated with the transaction will flow to the company. Revenue is measured at the fair value of the consideration received or receivable, excluding sales taxes and discounts.

Interest is recognised, in

profit or loss, using the effective interest rate method.

Dividends are recognised, in profit or loss, when the company’s right to receive payment has been established.

Opening balance

Additions Depreciation Total

- 1,580 (1,580) - 2,161 2,016 (4,177) - 2,770 - (1,583) 1,187

4,931 3,596 (7,340) 1,187

26


Annual Financial Statements for the year ended 31 December 20171.8 Provisions and contingencies (cont.)

Provisions are measured at the present value of the amount expected to be required to settle the obligation usinga pre - tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation. The increase in the provision due to the passage of time is recognised as interest expense.

Provisions are not recognised for future operating losses.

Reconciliation of property, plant and equipment 2016

Opening balance

Additions Depreciation Total

IT equipment - 7,834 (7,834) - Office equipment 10,793 219 (8,851) 2,161 Security equipment 4,352 7,456 (9,038) 2,770

15,145 15,509 (25,723) 4,931

3. Other financial assets

At fair value

Listed shares 701,242

525,834

Unlisted financial assets at fair value

Momentum Money Market Fund

-

172,919

-

172,919

Impairment

-

(172,919)

-

The Momentum Money Market Fund held with African Bank Limited has been fully impaired.

Non - current assets At fair value 701,242 525,834

The fair values of listed or quoted investments are based on the quoted market price at reporting period date.

27



Figures in Rand 2017 2016

Details of investments

Listed - at fair valueOld Mutual Plc 52,570 48,650Sanlam Limited 648,672 477,184

701,242 525,834


-

4. Inventories

Merchandise 8,200 9,681

5. Trade and other receivables

Trade receivables 1,807 3,662 VAT 6,628 3,457 Other receivables 8,803 33,777

17,238 40,896

6. Cash and cash equivalents

Cash and cash equivalents consist of:

Cash on hand 10,956 8,162 Bank balances 8,904,551 8,873,645

8,915,507 8,881,807

7. Trade and other payables

Trade payables - 24,211 Deposits for membership fees 1,726,165 1,574,673 Other payables 120,946 132,837

1,847,111 1,731,721

8. Revenue

Membership fees 2,768,971 2,521,309

9. Other income

Bad debts recovered - 2,500 CPD Penalty interest 84,000 95,000 Impairment cost recovered 172,919 21,754 Late payment penalties 56,215 61,783

313,134 181,037



28



10. Operating deficit

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

Operating lease charges Premises

Contractual amounts

236,058 216,567

Depreciation on property, plant and equipment 7,340

25,723

Employee costs 2,256,384

2,318,025

11. Investment revenue

Dividend revenue

Unlisted financial assets Local 21,647

20,815

Interest revenue

Bank

607,193

596,447

Unlisted financial assets

17,786

2,106

624,979

598,553

646,626

619,368

12. Fair value adjustments

Other financial assets

175,408

18,396

13. Cash used in operations

Profit (loss) before taxation

64,835

(550,346)

Adjustments for:

Depreciation and amortisation

7,340

25,723

Dividends received

(21,647)

(20,815)

Interest received

(624,979)

(598,553)

Fair value adjustments

(175,408)

(18,396)

Changes in working capital:

Inventories

1,481

435

Trade and other receivables

23,658

(34,214)

Trade and other payables

115,390

104,396

(609,330)

(1,091,770)

29





14. Auditor's remuneration

Fees 42,250 44,000

15. Directors' meeting attendance fees

Executive

Names

Andrew Wayne Bezuidenhout 54,000 47,600 Colinn Peter Alberts 3,200 - Daryl Wade Swanepoel 15,100 13,600 Derek Michael Johnstone 29,900 45,200 Johanna Magrieta Jacoba Lubbe 11,800 12,200 Micheal Alois Rudolf Biermann 27,100 59,600 Mogamat Shafiek Tassiem 14,900 20,200 Shawn Thomas Cupido 14,300 600 Tabile Mzwakali 11,900 9,600

16.

Related parties

` Relationships Members of key management Andrew Wayne Bezuidenhout

Ehsaan Nagia (Chief Financial Officer) Michael Alois Rudolf Biermann Tabile Mzwakali

Related party balances and transactions with key management personnel of the company or its parent

Related party transactions

Rent paid to related parties

Ehsaan Nagia

236,058

216,567

Assessor fees paid to related parties Andrew Wayne Bezuidenhout 1,700 4,110 Ehsaan Nagia 26,400 13,118 Michael Alois Rudolf Biermann 13,801 15,250 Tabile Mzwakali 1,700 -

30


Annual Financial Statements for the year ended 31 December 2017Notes to the Annual Financial Statements

182,200 208,600

Detailed Income Statement

Figures in Rand Notes 2017 2016

Other income

Bad debts recovered

2,500 CPD penalty interest

84,000

95,000 Dividends received 11

21,647

20,815 Impairment reversal

172,919

21,754 Interest received 11

624,979

598,553 Late payment penalties

56,215

61,783

959,760

800,405

Legal expenses 1,300 3,655 License and registration fees 1,556 1,415 Meeting attendance fees 15 182,200 208,600 Municipal expenses 32,144 33,772 Postage 13,366 12,482 Printing and stationery 16,158 15,910 Repairs and maintenance 5,387 5,735 Secretarial fees 1,050 Security 3,811 3,485 Services to members 33,400 42,800 Staff welfare 22,534 24,443 Subscriptions 30,583 35,029 Telephone and fax 45,344 43,027 Travel - local 205,873 171,842 Travel - overseas 156,487 92,424 Venue cost 6,476

Operating (deficit) 10

(110,573)

(568,742) Fair value adjustments 12 175,408 18,396

Surplus (deficit) for the year 64,835 (550,346)

Operating expenses

Advertising and marketing 89,933 120,289 Assessor's fee 51,051 42,983 Auditors remuneration 14 42,250 44,000 Bad debts 9,249 Bank charges 23,578 23,625 Computer expenses 2,454 2,498 Consumables 1,481 436 Depreciation 7,340 25,723 Discount allowed 10,673 Donations 2,000 1,800 Employee costs 2,256,384 2,318,025 Entertainment 2,018 1,092 Gifts

-

-

-

-

-

- 1,420 Insurance 365,848 364,977 Internet and website expenses 8,766 4,954 Lease rentals on operating lease 236,058 216,567

3,839,304 3,890,456



31

RevenueMembership fees 2,768,971 2,521,309

IAC BOARD OF DIRECTORS

IAC CHIEF EXECUTIVE OFFICERS

IAC STAFF MEMBERS

Andrew BezuidenhoutPresident

Shawn CupidoVice President

Chair Western Province

Derek JohnstoneImmediate Past President

Tabile MzwakaliDirector

Chair Eastern Province

Joey LubbeDirector

Chair Free State Province

Norman Chengeta Director

Chair Zimbabwe

Daryl SwanepoelDirector

Shafiek TassiemDirector

Colinn AlbertsDirector

Ehsaan Nagia Chief Executive Officer

South Africa

Jabulani Dube Chief Executive Officer

Zimbabwe

Prakash SinghGeneral Manager

Valencia WilliamsFinance Officer

Bronwyn BenjaminCompliance Officer

Abeedah InglisPersonal Assistant

Tasriq AdamsIT Officer

Soraya BuschMembership Officer

32

HEAD OFFICE252 Rosmead AvenueWynberg, 7780

PO Box 36477Glosderry, 7702South Africa

CONTACT US

www.iacsa.co.za

https://facebook.com/IACSA

IAC Institute of Accounting and Commerce

www.linkedin.com/company/iac-sa

[email protected]

021 761 6211

Recognised Controling Body for Accounting Professionals, Tax and Business Rescue Practitioners


your future secured

Documents

A FULL MEMBER OF PAFA AGM...of Accountants (PAFA). You will find the annual financial statements of your Institute which reflect a healthy, stable, liquid Institute. I do, however,