Annual General Meeting Meeting Agenda - Val de VieAnnual General Meeting Meeting Agenda August 26, 2015 18h00 Meeting: Val de Vie Lifestyle Home Owners’ Association Special General

Annual General Meeting

Meeting Agenda August 26, 2015

18h00

Meeting: Val de Vie Lifestyle Home Owners’ Association Special General Meeting

Where: Ballroom – Pavilion

Date & Time: 26 August 2015, 18h00

Chairman: Morne Bosch

Invited:

Members of the Val de Vie Lifestyle Estate Home Owners’ Association

Number Item

1. Welcoming

2. Quorum/Manner of Proceedings

3. Election of member trustees

4. Chairman’s Report

5. Consideration of Financial Statements for 2015

6. Presentation of 2016 Budget

7. Proclamation of vote

8. Closure

Please take note that the final Agenda may vary from the attached Agenda at the discretion of the Trustees.

Manner of Proceedings

The following will take place on the evening of 26 August 2015:

1. Statutory Proceedings for the 2015 Annual General Meeting for which the

following will apply:

Welcoming;

Quorum/Manner of Proceedings

Election of member trustees;

Chairman’s Report;

Consideration of the audited financial statements for 2015;

Presentation of the 2016 Budget;

Proclamation of vote;

Closure.

Kindly note that the following rules will apply during the 2015 Annual General Meeting of

the Val de Vie Lifestyle Estate Home Owners’ Association.

Only members whose accounts are fully paid will be able to attend the meeting and cast

votes as set per the Constitution, either in person or by proxy.

Members whose accounts are fully paid will receive a voting card for each property they

own.

It is each member’s duty to ensure that their accounts are fully paid up to date. The

HOA office can be contacted at [email protected].

Coffee and tea will be served from 17h30 and the Restaurant will be open for dinner –

please reserve your table at 021 863 6174 or [email protected]

mailto:[email protected]


PROXY FORM

I/We _________________________________ owner/s of SG ________ being a

member of the Homeowners’ Association and entitled to vote, hereby appoint:

X

the Chairman of the meeting

as my proxy to attend, speak and vote on my behalf, as indicated below at the Annual

General Meeting to be held on 26 August 2015 and at any adjournment thereof

SIGNED at ____________________ on ________________________________ 2015.

Signature/s: ____________________ Name/s (Print):__________________________

This Proxy form must be submitted to HOA Reception or [email protected] on/before

Friday 21 August 2015 by 17:00.


RESOLUTION FORM

RESOLUTION OF THE BOARD OF DIRECTORS, alternatively MEMBERS, alternatively

TRUSTEES OF

___________________________________________________________________

(NAME OF COMPANY, CLOSE CORPORATION OR TRUST)

As the registered owner of

SG: ________________________________________________________________

SIGNED at ____________________ on this ______ day of ______________ 2015.

Resolved that:

___________________________________________________________________

(Name in BLOCK LETTERS)

Be and is hereby duly appointed as representative.

The aforementioned shall furthermore be entitled to attend, speak and vote in

person or by proxy at the AGM as well as the Special General Meeting to be held on

Wednesday, 26 August 2015 and at any adjournment thereof and to bind the

Company/Close Corporation/Trust in this regard.

Name: __________________________ Signature: _______________________

(DIRECTOR/MEMBER/TRUSTEE)

Name: __________________________ Signature: _______________________

(DIRECTOR/MEMBER/TRUSTEE)

This Resolution form must be submitted to HOA Reception or [email protected] on/before Friday 21

August 2015 by 17:00.


CONSENT FORM

PROPERTY OWNED BY MORE THAN ONE PERSON

We, the registered owners: _____________________________________________

___________________________________________________________________

(Names in BLOCK Letters)

SG:

___________________________________________________________________

Hereby give consent to (one of the above owners): __________________________

To attend, speak and vote in person or by proxy at the AGM as well as the Special

General Meeting to be held on Wednesday, 26 August 2015 and at any adjournment

thereof.

SIGNED at ____________________ on this ______ day of ______________ 2015.

Signature: ___________________________________

Signature: ___________________________________

This Consent form must be submitted to HOA Reception or [email protected] on/before

Friday 21 August 2015 by 17:00.


NOMINATION FORM FOR THE BOARD OF

TRUSTEES

Nominated by: _____________________________ SG: _______________

Signature: _________________________________

Nominee: _________________________________ SG: ________________

Email : ________________________________________________________

Cell No: ______________________ Tel No: ________________________

Relevant Experience of the candidate and Motivation:

_______________________________________________________________

_______________________________________________________________

_______________________________________________________________

_______________________________________________________________

_______________________________________________________________

_______________________________________________________________

_______________________________________________________________

_______________________________________________________________

_______________________________________________________________

_______________________________________________________________

_______________________________________________________________

_______________________________________________________________

This Nomination form should ideally be accompanied by a Curriculum Vita of

the nominated candidate which must be submitted to HOA Reception or

[email protected] on/before Monday, 17 August 2015 by 16:00.


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VAL DE VIE WINELANDS LIFESTYLE ESTATE HOMEOWNERS' ASSOCIATION ("VAL DE VIE HOMEOWNERS' ASSOCIATION")Annual financial statementsfor the year ended 28 February 2015

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VAL DE VIE HOMEOWNERS' ASSOCIATIONAnnual Financial Statements for the year ended 28 February 2015

General Information

Country of incorporation and domicile South Africa

Trustees M Bosch

L Cronje

S Rossouw

R Swart

M Venter

A Gildenhuys

R Neethling

R Terblanche

C van der Venter

Auditors PricewaterhouseCoopers Incorporated

Managing Agent Elements Management (Pty) Ltd

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Index

The reports and statements set out below comprise the annual financial statements presented by the trustees:

Page

Independent Auditor's Report 3 - 4

Statement of Financial Position 5

Statement of Comprehensive Income 6

Statement of Changes in Equity 7

Accounting Policies 8 - 10

Notes to the Annual Financial Statements 11 - 13

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

Detailed Income Statement 14 - 16

Tax Computation 17

Trustees responsibilities

The trustees are required to maintain adequate accounting records and are responsible for the content and integrityof the annual financial statements and related financial information included in this report. It is their responsibility toensure that the annual financial statements fairly present the state of affairs of the association as at the end of thefinancial year and the results of its operations for the year then ended, in conformity with the basis of accounting asset out in Note 1 to the financial statements. The external auditors are engaged to express an independent opinionon the annual financial statements.

The annual financial statements and additional schedules set out on pages 5 to 17, which have been prepared onthe going concern basis, were approved by the board on ________________ and were signed on its behalf by:

Trustee Trustee

2

Independent Auditor's Report

To the trustee of VAL DE VIE HOMEOWNERS' ASSOCIATION

3

Independent Auditor's Report

PricewaterhouseCoopers Incorporated

31 May 2012

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Statement of Financial Position

2015 2014Notes R R

Assets

Current Assets

Investments 3 17,353,919 12,159,570

Trade and other receivables 4 3,244,492 4,146,912

Cash and cash equivalents 5 550,706 1,522,160

21,149,117 17,828,642

Non-Current Assets

Property, plant and equipment 2 14,624,193 12,782,258

Total Assets 35,773,310 30,610,900

Equity and Liabilities

Liabilities

Current Liabilities

Trade and other payables 6 6,989,535 6,397,731

Owners' funds and reserves

Infrastructure and maintenance 7 4,115,547 4,888,023

Accumulated surplus 24,668,228 19,325,146

28,783,775 24,213,169

Total Equity and Liabilities 35,773,310 30,610,900

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Statement of Comprehensive Income

2015 2014Notes R R

Revenue 8 21,551,414 23,286,081

Other income 9 2,128,619 1,923,463

Operating expenses (19,109,427) (18,463,067)

Operating surplus 4,570,606 6,746,477

Transfer from/(to) infrastructure and maintenance reserve 772,476 (1,371,493)

Net surplus for the year 5,343,082 5,374,984

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Statement of Changes in Equity

Infrastruc-ture and

maintenancereserve

Accumulatedsurplus

Total equity

R R R

Balance at 01 March 2013 3,516,530 13,950,162 17,466,692Changes in equityTotal comprehensive income for the year - 5,374,984 5,374,984Transfer to infrastructure and maintenance reserve 1,371,493 - 1,371,493

Total changes 1,371,493 5,374,984 6,746,477

Balance at 01 March 2014 4,888,023 19,325,146 24,213,169Changes in equityTotal comprehensive income for the year - 5,343,082 5,343,082Transfer to infrastructure and maintenance reserve (772,476) - (772,476)

Total changes (772,476) 5,343,082 4,570,606

Balance at 28 February 2015 4,115,547 24,668,228 28,783,775

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Accounting Policies

1. Presentation of Annual Financial Statements

The annual financial statements have been prepared in accordance with the accounting policies as set out below.The annual financial statements have been prepared on the historical cost basis. They are presented in SouthAfrican Rands.

These accounting policies are consistent with the previous period.

1.1 Property, plant and equipment

All property, plant and equipment is stated at historical cost less depreciation except certain items carried over fromthe developer at no cost. Historical cost includes expenditure that is directly attributable to the acquisition of theitems.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate,only when it is probable that future economic benefits associated with the item will flow to the party and the cost ofthe item can be measured reliably. All other repairs and maintenance are charged to the income statement duringthe financial period in which they are incurred.

Depreciation is provided using the straight-line method to write down the cost, less estimated residual value overthe useful life of the property, plant and equipment.

Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These areincluded in the income statement.

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount isgreater than its estimated recoverable amount .

Software is classified as Property, Plant and Equipment.

1.2 Financial instruments

Financial instruments at cost

Equity instruments that are not publicly traded and whose fair value cannot otherwise be measured reliably aremeasured at cost less impairment. This includes equity instruments held in unlisted investments.

All financial assets whose fair value cannot otherwise be measured reliably, and which do not meet the criteria tobe designated as an instruments measured at amortised cost, are measured at cost less impairments.

Trade and other receivables

Trade receivables are recognised and carried at cost. A provision for impairment of trade receivables isestablished when there is objective evidence that the party will not be able to collect all amounts due accordingto the original terms of receivables. A provision for outstanding levies are only made if, in the opinion of theTrustees, the amounts could not be recovered through restriction of the transfer of the erven.

Cash and cash equivalents

Cash and cash equivalents includes cash on hand, demand deposits and other short-term highly liquidinvestments with original maturities of three months or less. Bank overdrafts are shown as current liabilities onthe statement of financial position.

Trade and other payables

Trade payables are recognised initially at the transaction price and subsequently measured at amortised costusing the effective interest method.

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Accounting Policies

1.3 Tax

Current tax assets and liabilities

Current tax for current and prior periods is, to the extent unpaid, recognised as a liability. If the amount already paidin respect of current and prior periods exceeds the amount due for those periods, the excess is recognised as anasset.

Tax expenses

Current tax is charged or credited directly to equity if the tax relates to items that are credited or charged, in thesame or a different period, directly to equity.

1.4 Impairment of assets

The homeowners' association assesses at each reporting period date whether there is any indication that an assetmay be impaired. If any such indication exists, the homeowners' association estimates the recoverable amount ofthe asset.

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

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

1.5 Provisions and contingencies

Provisions are recognised when:� the association has an obligation at the reporting period date as a result of a past event;� it is probable that the association will be required to transfer economic benefits in settlement; and� the amount of the obligation can be estimated reliably.

Provisions are not recognised for future operating losses.

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

1.6 Revenue

Revenue is measured at the fair value of the consideration received or receivable and represents the amountsreceivable for goods and services provided in the normal course of business, net of trade discounts and volumerebates, and Value Added Tax.

Levies

Levies are recognised as it becomes payable.

Interest

Interest is recognised, in surplus or deficit, using the effective interest rate method.

Rental income and expense

Rental income and expense is recognised as per the terms of the contract.

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Accounting Policies

1.6 Revenue (continued)

Developer transfers of property

These transfers, as per the Constitution, is transferred at no cost and no revenue or gain is recognised by theassociation in this regard.

Direct recoveries of costs

These items for example legal fees and water cost recoveries are set off to costs and not treated as revenue orother income by the association.

1.7 Significant judgements and sources of estimation uncertainty

In preparing the annual financial statements, management is required to make estimates and assumptions thataffect the amounts represented in the annual financial statements and related disclosures. Use of availableinformation and the application of judgement is inherent in the formation of estimates. Actual results in the futurecould differ from these estimates which may be material to the annual financial statements. Significant judgementsinclude:

Valuation of debtors

All outstanding debtors (including interest raised on outstanding levies) at year end is regarded as recoverable dueto the fact that no erf can be transferred to a new buyer before all outstanding levy fees have been fully paid.

Allocation of expenses

General estate expenses incurred by the developer, are proportionally allocated to the Homeowners' Associationbased on management’s judgement, after review and approval by the Trustees. If the allocation method and orpercentage changes from year to year, specific Trustee approval is required.

Value Added Tax

The company remains registered for VAT following an amendment in the VAT Act that levies are exempt.

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Notes to the Annual Financial Statements

2015 2014R R

2. Property, plant and equipment

2015 2014

Cost Accumulateddepreciation

Carryingvalue

Cost Accumulateddepreciation

Carryingvalue

Land and buildings 1,018,693 (108,696) 909,997 252,879 (14,757) 238,122Plant and machinery 754,778 (178,651) 576,127 396,278 (138,050) 258,228Furniture and fixtures 798,942 (165,064) 633,878 798,942 (100,472) 698,470Motor vehicles 367,262 (83,841) 283,421 121,249 (12,291) 108,958IT equipment 110,973 (95,402) 15,571 92,888 (68,539) 24,349Computer software 215,807 (72,898) 142,909 194,107 (52,105) 142,002Roads and pathways 3,304,864 (680,699) 2,624,165 3,304,864 (401,443) 2,903,421Security - Infrastructure 9,325,526 (1,747,949) 7,577,577 8,987,933 (828,140) 8,159,793Other property, plant andequipment

2,016,705 (156,157) 1,860,548 264,294 (15,379) 248,915

Total 17,913,550 (3,289,357) 14,624,193 14,413,434 (1,631,176) 12,782,258

Reconciliation of property, plant and equipment - 2015

Openingbalance

Additions Depreciation Total

Land and buildings 238,122 765,814 (93,939) 909,997Plant and machinery 258,228 358,500 (40,601) 576,127Furniture and fixtures 698,470 - (64,592) 633,878Motor vehicles 108,958 246,013 (71,550) 283,421IT equipment 24,349 18,085 (26,863) 15,571Computer software 142,002 21,700 (20,793) 142,909Roads and pathways 2,903,421 - (279,256) 2,624,165Security - Infrastructure 8,159,793 337,593 (919,809) 7,577,577Other property, plant and equipment 248,915 1,752,411 (140,778) 1,860,548

12,782,258 3,500,116 (1,658,181) 14,624,193

Reconciliation of property, plant and equipment - 2014

Openingbalance

Additions Depreciation Total

Land and buildings - 252,879 (14,757) 238,122Plant and machinery 288,114 12,719 (42,605) 258,228Furniture and fixtures 621,402 134,057 (56,989) 698,470Motor vehicles - 121,249 (12,291) 108,958IT equipment 47,028 9,028 (31,707) 24,349Computer software 128,674 37,275 (23,947) 142,002Roads and path ways 2,825,416 356,205 (278,200) 2,903,421Security - Infrastructure 8,074,892 871,142 (786,241) 8,159,793Other property, plant and equipment - 264,294 (15,379) 248,915

11,985,526 2,058,848 (1,262,116) 12,782,258

In accordance with clause 11.4 of the HOA Constitution, certain property, plant and equipment are carried over fromthe Developer to the Home Owners Association at no cost. At year-end this included a total of 33 (2014: 28) erven.

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2015 2014R R

2. Property, plant and equipment (continued)

The infrastructure assets of the Homeowners' Association (including assets carried over from the Developer to theHomeowners' Association at no cost) were independently valued at current replacement cost by a professionalqualified engineering firm (Aurecon SA (Pty) Ltd) during 2011 at a value of approximately R180 000 000.

The following assets were included:

- Water and sewerage- Irrigation- Roads and paved areas- Buildings and boundary wall- Security infrastructure- Communications infrastructure

The value of R180 000 000 has been adjusted for inflation and annual additions for insurance cover purposes.

As per trustee policy, a new valuation is conducted every three to five years.

3. Investments

Momentum Money Market Fund 2,004,261 1,893,880Prudential Money Market Fund 62,332 59,006Coronation Money Market Fund 4,736,593 4,128,027Glacier Absolute Return Fund 10,550,733 6,078,657

17,353,919 12,159,570

As stipulated in clause 35.2 of the Homeowners' Association Constitution, the Trustees are mandated to set upreserve accounts for funds that are held over and above one year’s working capital requirements. These reservesmay be invested in absolute return funds with an explicit target of no more than CPI + 5% with any financialinstitution as approved by the Trustees from time to time.

A cession exists over the Momentum Money Market Fund account for R276,000 or any re-investment, renewal orreplacement thereof relating to municipal deposits.

4. Trade and other receivables

Levies receivable 2,905,068 3,706,972Sundry debtors 188,696 289,212Municipal deposits 145,728 145,728Other deposits 5,000 5,000

3,244,492 4,146,912

5. Cash and cash equivalents

Cash and cash equivalents consist of:

Nedbank current account 203,795 1,299,756Nedbank call account 346,911 222,404

550,706 1,522,160

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2015 2014R R

6. Trade and other payables

Levies received in advance 1,455,777 1,483,640Building deposits - builders 3,525,057 2,975,057Other payables 24,301 48,465Sundry creditors 1,976,719 1,870,546South African Revenue Services - VAT 7,681 20,023

6,989,535 6,397,731

7. Infrastructure and maintenance reserve

Infrastructure and maintenance reserve 4,115,547 4,888,023

Allocations are made to the Infrastructure and maintenance reserve in accordance with an asset management plan,conducted by the engineering firm Aurecon SA (Pty) Ltd. The high-level plan covers a 20 year horizon, focusing onprojected capital renewal and annual operation and maintenance requirements.

8. Revenue

Levies: Normal 15,205,052 13,472,776Levies: Extraordinary 4,214,112 7,964,465Levies: Road 2,132,250 1,848,840

21,551,414 23,286,081

9. Other income

Clearance certificates 171,197 172,368Fines and penalties - estate 52,744 76,305Insurance claims received - 357,416Interest received: Investment and cash balances 1,308,550 625,637Interest received: Overdue accounts 392,388 494,553Notices: Overdue accounts 20,400 20,900Rental income 127,753 105,470Estate agents registration fees 44,000 64,000Sundry income 11,587 6,814

2,128,619 1,923,463

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Detailed Income Statement

2015 2014R R

Revenue

Levies: Normal 15,205,052 13,472,776

Levies: Extraordinary 4,214,112 7,964,465

Levies: Road 2,132,250 1,848,840

21,551,414 23,286,081

Other income

Rental income 127,753 105,470

Clearance certificate 171,197 172,368

Notice: Overdue accounts 20,400 20,900

Interest received: Overdue accounts 392,388 494,553

Sundry Income 11,587 6,814

Fines - Estate rules 52,744 76,305

Insurance claims received - 357,416

Interest received - Investment and cash balances 1,308,550 625,637

Estate agents registration fees 44,000 64,000

2,128,619 1,923,463

Operating expenses

Administrative expenses 498,545 485,433

Bank charges 44,465 45,655

Printing and stationery 31,016 29,252

Lease rentals on operating lease 24,613 22,836

IT and electronic infrastructure 87,135 74,039

Communication portal 44,379 15,966

Audit fees: Audit 57,505 54,250

Audit fees: Other and under provision for prior year 3,220 21,445

Legal fees: Overdue accounts 317,187 342,478

Legal fees recovery: Overdue accounts (317,187) (342,477)

Telephone and fax 132,797 108,901

Groceries 9,645 8,947

Subscriptions fees 7,041 555

Legal fees: HOA 40,712 70,363

Meetings 14,517 27,723

Website 1,500 5,500

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2015 2014R R

General expenses 1,774,608 1,305,853

Petrol and oil 94,269 55,286

Sundry expenses 2,128 1,791

Motor vehicle expenses 3,469 6,818

Professional fees 18,500 15,128

Depreciation 1,658,181 1,262,116

Travel & accommodation - 4,869

Ad hoc income and expenses (1,939) (40,155)

Building activity (730,910) (844,009)

Building fines (75,790) (87,369)

Building office staff cost allocation 992,160 936,000

Builders board income (95,200) (179,627)

Builders board expenses 107,755 157,183

Building control income (2,102,250) (1,871,880)

Builders control expenses 215,250 178,400

Building-as-builds - 1,508

License fees 40,626 24,797

Pavement reconstruction (30,176) (5,790)

Water meter connection: Income (224,200) (342,100)

Water meter connection: Expense 253,495 268,598

Legal fees: Building 187,420 76,270

Residential services 139,927 167,590

Communication signage and estate maps 84,373 102,880

Social club expenses 12,613 20,207

Medical response ER 42,941 44,503

Building and infrastructure 736,825 692,749

Sports and leisure centre: Cleaning 94,348 113,446

Sports and leisure center: Running cost 241,832 189,420

Sports and leisure center: Electricity 354,682 334,440

Pest control 45,963 55,443

Landscaping costs 6,644,015 7,286,138

Landscaping: Architect and professional fees 66,000 120,000

Landscaping: Garden consumables 182,771 175,875

Landscaping: Maintenance contracts 5,637,671 5,599,331

Landscaping: Projects and other 757,573 1,390,932

Municipal costs 374,686 324,220

Electricity 827,592 780,361

Municipal rates and taxes 46,350 110,272

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2015 2014R R

Water: HOA usage 30,516 27,957

Water: Home Owners usage 2,993,930 1,709,390

Water: Home Owners recovery (3,602,094) (2,371,573)

Municipal refuse and rubble removal 78,392 67,813

Repairs and maintenance 2,766,327 2,491,575

Costs recovered by insurance claims 70,725 357,416

IT and electronic infrastructure - 75,886

Facilities management: System 274,752 208,500

Facilities management: Operational 2,420,850 1,849,773

Staff cost and estate management 2,336,659 2,219,464

Staff cost and estate management 2,319,554 2,195,746

Building control: staff cost allocation 17,105 23,718

Security fees 4,224,569 3,811,441

Security: Guarding contract 2,897,957 2,380,453

Security: Other 129,552 388,480

Security: Remote monitoring 616,672 482,650

Security: Valley security initiative 74,629 112,050

Security: Systems 505,759 447,809

Insurance 307,966 326,545

Environment 36,210 196,067

Fire equipment and health and safety 4,909 71,780

Water system management plan and maintenance 31,301 124,287

19,109,426 18,463,067

Operating surplus 4,570,607 6,746,477

Transfer from/(to) infrastructure and maintenance reserve 772,476 (1,371,493)

Surplus for the year 5,343,083 5,374,984

16

VAL DE VIE WINELANDS LIFESTYLE ESTATE HOME OWNERS ASSOCIATION("VAL DE VIE HOMEOWNERS' ASSOCIATION")

Financial Budget

for Period Ending February 2016

VAL DE VIE HOMEOWNERS' ASSOCIATIONFinancial Budgetfor Period Ending February 2016

Index

Page

Operational budget summary 1

Expense analysis 2

Capital expenses budget 3

Important ratios 4

Summary of inputs used and resultant outputs 5


Operational budget summary

2015 YTD 2015

% Total Monthly Actuals Budget Monthly Total % Monthly Total % Notes

Total Income - HOA Operations 22,958,813 1,913,234 -2% 5% 1,959,600 23,515,200 1,826,226 21,914,714

Normal levies 72% 16,638,013 1,386,501 10% 11% 1,261,675 15,140,099 64% 1,245,024 14,940,292 68% 1

Extraordinary levies 12% 2,674,875 222,906 -38% -19% 359,549 4,314,584 18% 275,333 3,304,000 15% 2

Builders' road Levies 8% 1,886,500 157,208 -15% -19% 185,945 2,231,340 9% 194,350 2,332,200 11% 3

Other income 8% 1,759,425 146,619 -4% 31% 152,431 1,829,177 8% 111,519 1,338,222 6% 4

Total Expenses - HOA Operations 21,782,417 1,815,201 21% 11% 1,498,464 17,981,573 1,634,552 19,614,622 5

Landscaping 32% 7,062,912 588,576 13% 4% 522,100 6,265,197 35% 564,567 6,774,804 35%

Security fees 21% 4,552,232 379,353 8% 7% 350,044 4,200,531 23% 354,437 4,253,243 22%

Maintenance costs 15% 3,296,145 274,679 36% 12% 202,562 2,430,743 14% 244,336 2,932,033 15%

Staff Costs & Management 11% 2,488,842 207,404 7% 6% 194,428 2,333,138 13% 196,128 2,353,536 12%

General expenses 9% 2,040,500 170,042 24% 30% 136,602 1,639,223 9% 131,250 1,575,000 8%

Municipal Costs 4% 869,969 72,497 143% 9% 29,819 357,833 2% 66,277 795,327 4%

Buildings & Infrastructure 3% 650,781 54,232 15% 31% 46,984 563,806 3% 41,453 497,435 3%

Administrative expenses 2% 473,572 39,464 14% 2% 34,670 416,044 2% 38,752 465,028 2%

Insurance 2% 354,000 29,500 6% -2% 27,824 333,891 2% 30,000 360,000 2%

Residential services 2% 338,978 28,248 52% 8% 18,544 222,524 1% 26,108 313,292 2%

Environment 1% 112,336 9,361 46% -48% 6,432 77,186 0% 18,133 217,596 1%

Building activity -2% -457,850 -38,154 -47% -50% -71,545 -858,544 -5% -76,889 -922,672 -5%

Net surplus/(deficit) from HOA operations 1,176,396 98,033 -79% -49% 461,136 5,533,627 191,674 2,300,092

Notes:

1 - New levy of R2 995 VAT incl. Annual increase of 6.02%

- 523 normal levies beginning of year, estimate of 9 stands to transfer = 532 by the end of year

2 - All new building sites applied to 3rd year extraordinary levy stands

- Refer to note 4 below for building stats

3 - New road levy of R2 450 VAT incl. Annual increase of 6.52%

- 70 new building sites beginning of year, estimate average of 64 sites per month

- Estimate total building activity at end of year - 482 houses (of which 65 are active sites)

4 Consist mainly of the following income sources:

Interest on Overdue Accounts 331,702

Interest on Cash Balances 1,171,083

5 Refer to "Expense analysis" - page 2

Important to note that 2015 year-to-date actuals (up to 2014/12) are not a true reflection of the year-end monthly average, as some annual costs will only be incurred in January and February

Variance % 2015 YTD Actuals

Dec-14

2015 Budget2016 Budget

1


Expense analysis

2015 YTD 2015

ExpensesNormal

levyTotal Monthly

Actuals Budget NotesExpenses

Normal

levyTotal Monthly Expenses

Normal

levyTotal Monthly

Total expenses (2016 largest to smallest) 21,782,417 1,815,201 21% 11% 1 17,981,573 1,498,464 19,614,622 1,634,552

Landscaping 32% 42% 7,062,912 588,576 13% 4% 2 35% 41% 6,265,196.57 522,100 35% 45% 6,774,804 564,567

Security fees 21% 27% 4,552,232 379,353 8% 7% 3 23% 28% 4,200,531.46 350,044 22% 28% 4,253,243 354,437

Maintenance costs 15% 20% 3,296,145 274,679 36% 12% 4 14% 16% 2,430,743.39 202,562 15% 19% 2,932,033 244,336

Staff Costs & Management 11% 15% 2,488,842 207,404 7% 6% 5 13% 15% 2,333,137.74 194,428 12% 16% 2,353,536 196,128

General 9% 12% 2,040,500 170,042 24% 30% 6 9% 11% 1,639,223.50 136,602 8% 10% 1,575,000 131,250

Municipal Costs 4% 5% 869,969 72,497 143% 9% 7 2% 2% 357,833.35 29,819 4% 5% 795,327 66,277

Buildings & Infrastructure 3% 4% 650,781 54,232 15% 31% 8 3% 4% 563,806.22 46,984 3% 3% 497,435 41,453

Administrative expenses 2% 3% 473,572 39,464 14% 2% 2% 3% 416,043.69 34,670 2% 3% 465,028 38,752

Insurance 2% 2% 354,000 29,500 6% -2% 2% 2% 333,890.70 27,824 2% 2% 360,000 30,000

Residential services 2% 2% 338,978 28,248 52% 8% 1% 1% 222,524.02 18,544 2% 2% 313,292 26,108

Environment 1% 1% 112,336 9,361 46% -48% 0% 1% 77,185.62 6,432 1% 1% 217,596 18,133

Building activity -2% -3% -457,850 -38,154 -47% -50% 9 -5% -6% -858,544 -71,545 -5% -6% -922,672 -76,889

- - - - -

Assumption: Surplus from building activity (negative expenses) counteracts additional maintenance costs due to increased building activity

Normalised expenses comparison 2016 Budget 2015 YTD Actuals 2015 Budget

Adjustment for abnormal items:

- Water over recovery 10,000 44,116 -

- Building activity surplus 38,154 71,545 76,889

- Once-off Polo Fields income - UB40 - 16,667 -

Non-CF items:

- Depreciation -166,000 -133,187 -130,000

Normalised expenses 1,697,356 1,497,605 1,581,441

Effective year-on-year increase:

- 2015 YTD actuals 13%

- 2015 Budget 7%

If maintenance excluded 1,422,677 1,295,043 1,337,105

Effective year-on-year increase:

- 2015 YTD actuals 10%

- 2015 Budget 6%

Notes (specifically 2016 figures)

1 Important to note that 2015 year-to-date actuals (up to 2014/12) are not a true reflection of the year-end monthly average, as some annual costs will only be incurred in January and February

2015 YTD variance should be in line with inflation once annual expenses have been incurred

2 Inflationary increased budgeted for - landscaping contracts

Consumable budget not fully utilised 2014/12 YTD - additional purchases in Jan / Feb 2015

3 Increased security contract fee due to increase in number of residents (additional guards) and specialised equipment (additional technician)

Labour component to increase by 8%

4 2015 actual maintenance spent was lower than budgeted for. Increased number of scheduled maintenance items for 2016 as well as capital replacement (in line with 20 year Aurecon plan).

Higher than expected building activity to date - damages to roads etc. lead to increase in scheduled & reactive maintenance

5 Management Fee escalated by 6% (scope of services remains unchanged - inflationary increase)

6 Large increase in provision for depreciation

7

8

9 Reduced number of active building sites

Larger % of monthly electricity costs allocated to lifestyle centre (based on actual historical consumption)

"2015 Actuals" figures distorded due to municipal water overrecovery

15% increase in electricity as indicated by Drakenstein

Year-on-year increase of 13% vs 2015 YTD actuals if water overrecovery adjusted to R10 000 per month

Water overrecovery due to effect of Municipal sliding scale water usage calculations: due to the overall Val de Vie usage, the HOA can utilise all free water units. However, not all Homeowners are allocated free

units if usage is less than a specified minimum consumption for a specific month. The HOA therefore receives more free units from Drakenstein than free units allocated to Homeowners.

2016 budget

% of total

Variance % 2015 Budget

% of total

2015 YTD Actuals (2014/12)

% of total

2


Capital expenses budgetI&M

Replacement/ Reserve

Improvement Fund TOTAL

LANDSCAPE 350,000 - 350,000

Upgrade of landscaping areas 300,000 - 300,000

Polo Fields Re-sowing of polo fields 50,000 - 50,000

SECURITY 674,133 - 674,133

General 102,500 - 102,500 Energizers - stinger bs120 Reach end of lifespan 80,000 - 80,000

Gate motors Strain on motors due to excessive opening & closing 22,500 - 22,500

Access points to the estate - main & L'Hugenote gate 94,233 - 94,233

Spike motors Replacement of gearboxes 6,500 - 6,500

Booms - knuckles & poles Reach end of lifespan 12,600 - 12,600

Biometric readers Reach end of lifespan 54,000 - 54,000

PT guest unit upgrade Additional entry at L'Hugenote gate 6,133 - 6,133

Loop detectors Reach end of lifespan 15,000 - 15,000

Internal access doors - lifestyle, pump houses etc. 66,800 - 66,800

Door mag locks Reach end of lifespan 4,300 - 4,300

Sport and Leisure Centre Upgrading of opening/closing mechanisms 62,500 - 62,500

Inner lane booms - all circles 149,000 - 149,000

Booms Reach end of lifespan 69,000 - 69,000

Batteries Upgrade to enable operation during load shedding 80,000 - 80,000

CCTV cameras internal 58,000 - 58,000

Fibre converters Replacement 6,000 - 6,000

Sport & Leisure Centre - 5 x mini dome Reach end of lifespan 20,500 - 20,500

Main gate - camera housings Reach end of lifespan 3,500 - 3,500

Main gate - internal mini domes Reach end of lifespan 24,500 - 24,500

L'Hugenote gate - camera housings Reach end of lifespan 3,500 - 3,500

Alarm systems 13,500 - 13,500

Passives - L'Hugenote gate Reach end of lifespan 13,500 - 13,500

Control room monitor power supplies 24,500 - 24,500

Main gate - monitor power supplies Reach end of lifespan 7,500 - 7,500

Main gate - cctv monitors 32" Reach end of lifespan 17,000 - 17,000

PC / software upgrades 31,800 - 31,800

Electric fence PC Reach end of lifespan 7,600 - 7,600

Main entrance - vbm bosch client Reach end of lifespan 16,600 - 16,600

Main entrance - 2nd access client pc Reach end of lifespan 7,600 - 7,600

Future development prediction 133,800 - 133,800

PT guest scanners Additional scanners required to assist with access 64,500 - 64,500

Over voltage protection module Damage due to over voltage 16,500 - 16,500

Turnstile maintenance Mechanical elements of turnstiles may require replacement 25,000 - 25,000

Spare controller board - booms Emergency spare 1,300 - 1,300

Batteries 2,000 - 2,000

Access control ptt change to itrt Reach end of lifespan 20,000 - 20,000

Upgrade range of gate remotes Improvement on river gates (antenna) 4,500 - 4,500

INFRASTRUCTURE 1,430,000 347,667 1,777,667

Roads 245,000 - 245,000

Asphalt Speed humps/etc. 60,000 - 60,000

Footpaths New pedestrian paths 185,000 - 185,000

Storm Water 100,000 - 100,000

Open Channels Unlined Storm water sand track 80,000 - 80,000

Open Channels Unlined Storm water SG429 to SG435 20,000 - 20,000

Sanitation 140,000 270,000 410,000

Pump stations Mechanical Catchment system to be improved 140,000 - 140,000

Pump stations Electrical Reach end of lifespan 30,000 30,000

Pump stations Mechanical Reach end of lifespan 160,000 160,000

Reticulation Pipework Sagging of roads to be repaired 80,000 80,000

Irrigation 945,000 77,667 1,022,667

Estate Pump house Electrical Installation of new generation motors 95,000 - 95,000

Irrigation Controls Second phase of Mottech automation installation 850,000 - 850,000

River Pump house Mechanical Replacement - 53,667 53,667

River Pump house Electrical Electrical work on above item - 24,000 24,000

BUILDING - S&LC 102,000 - 102,000

Sport and Leisure Centre Additional gym equipment 50,000 - 50,000

Sport and Leisure Centre Office, boardroom, kitchen and post office upgrade 35,000 - 35,000

Sport and Leisure Centre Equipment - cordless phone and projector for boardroom 17,000 - 17,000

GENERAL 105,000 - 105,000

IT General upgrades (network switches, wireless routers, IT equipment) 105,000 - 105,000

TOTAL 2,661,133 347,667 3,008,800

Average monthly 221,761 28,972 250,733

3


Important ratios

2015 2016Budget Budget

1 Debtors days

- Residential (normal and extraordinary levies) 45.89 21.18

2 Debtors balance as % of annual levies

- Residential (normal and extraordinary levies) 14.53% 6.71%

3 % of total annual levies collected

- Residential (normal and extraordinary levies) 100.72% 104.34%

4 % stands transferred paying extraordinary levies 24.69% 6.69%

5 % stands transferred with building activity 88.80% 94.70%

6 Extraordinary levy ratios:

- Extraordinary levy income as % of total HOA income 15.08% 11.65%

7 HOA operational costs not recovered by normal levies

- Including depreciation 23.83% 23.62%

- Excluding depreciation 20.07% 15.93%

4


Summary of inputs used and resultant outputs

2016

Fin Year

Normal levy (VAT incl) 2,995

Extraordinary levy base cost ("ELBC") 1,995

Estimated % of levy income not collected

- Normal levy 0%

- Extraordinary levy 10%

- Interest on overdue accounts 18%

60%

Building Control Fee - VAT excl 2,450

Building Road levy - VAT excl 2,450

Summary of outputs

Normal levy income 16,638,013

Extraordinary levy income 2,674,875

Operational surplus/(loss) before tax 1,176,396

Yearly change in retained surplusses after allocation to I&M reserves -1,183,021

Capital expenses ("CAPEX") 2,661,133

Cash balances

Opening cash balance 18,000,000

Movement for the year 1,114,661

Cash balance at year-end 19,114,661

- Available for operational expenses 12,631,756

- I&M reserve allocation 6,482,905

Accumulated reserves 30,467,498

Retained surplusses 23,984,593

Infrastructure and maintenance fund 6,482,905

Debtors balances at year-end

- Residential 1,476,638

Debtors days 21.18

Estimated % of current debtors handed-over balances to be collected within

next 12 months

5

Documents

Annual General Meeting Meeting Agenda - Val de VieAnnual General Meeting Meeting Agenda August 26, 2015 18h00 Meeting: Val de Vie Lifestyle Home Owners’ Association Special General