I . .1 2016/2017 .. INDEPENDENT POLICE INVESTIGATIVE DIRECTORATE #23 (m _Z_um_umz_umz._. _u0_._nm Contents PART A: GENERAL INFORMATION 5 1. DEPARTMENT GENERAL INFORMATION 6 2. LIST OF ABBREVIATIONS/ACRONYMS 7 3. FOREWORD BY THE MINISTER 8 4. DEPUTY MINISTER STATEMENT 9 5. REPORT OF THE ACCOUNTING OFFICER 10 6. STATEMENT OF RESPONSIBILITY AND CONFIRMATION OF ACCURACY FOR THE ANNUAL REPORT 16 7. STRATEGIC OVERVIEW 17 7.1. Vision 17 7.2. Mission 17 7.3. Values 17 8. LEGISLATIVE AND OTHER MANDATES 17 9. ORGANISATIONAL STRUCTURE 18 10. ENTITIES REPORTING TO THE MINISTER 18 PART B: PERFORMANCE INFORMATION 19 1. AUDITOR GENERAL’S REPORT: PREDETERMINED OBJECTIVES 20 2. OVERVIEW OF DEPARTMENTAL PERFORMANCE 20 2.1 Service Delivery Environment 20 2.2 Service Delivery Improvement Plan 20 2.3 Organisational Environment 21 2.4 Key Policy Developments and Legislative Changes 21 3. STRATEGIC OUTCOME ORIENTED GOALS 21 4. PERFORMANCE INFORMATION BY PROGRAMME 22 4.1 Programme 1: Administration 22 5. PROGRAMME 2: INVESTIGATION AND INFORMATION MANAGEMENT 25 6. PROGRAMME 3: LEGAL SERVICES 29 2 IPID I ANNUAL REPORT I 2016/2017 7. PROGRAMME 4: COMPLIANCE MONITORING AND STAKEHOLDER MANAGEMENT 31 8. TRANSFER PAYMENTS 33 9. CONDITIONAL GRANTS 33 10. DONOR FUNDS 33 11. CAPITAL INVESTMENT 33 STATISTICAL REPORT 34 PART C: GOVERNANCE 67 1. INTRODUCTION 68 2. COMPLIANCE, ETHICS AND RISK MANAGEMENT 68 3. FRAUD AND CORRUPTION 68 4. MINIMISING CONFLICT OF INTEREST 69 5. CODE OF CONDUCT 69 6. HEALTH SAFETY AND ENVIRONMENTAL ISSUES 69 7. PORTFOLIO COMMITTEES 69 8. SCOPA RESOLUTIONS 70 9. PRIOR MODIFICATIONS TO AUDIT REPORTS 70 10. INTERNAL AUDIT AND AUDIT COMMITTEES 70 11. AUDIT COMMITTEE REPORT 72 PART D: HUMAN RESOURCE MANAGEMENT 75 1. INTRODUCTION 76 2. OVERVIEW OF HUMAN RESOURCES 76 3. HUMAN RESOURCES OVERSIGHT STATISTICS 77 PART E: FINANCIAL INFORMATION 93 Report of the Auditor-General of South Africa 94 Annual Financial Statements 99 IPID I ANNUAL REPORT I 2016/2017 3 IPID I ANNUAL REPORTI 2016/2017 20:52:82. 4 11 Financial assets 11.1 Financial assets (not covered elsewhere) A financial asset is recognised initially at its cost plus transaction costs that are directly attributable to the acquisition or issue of the financial. At the reporting date, a department shall measure its financial assets at cost, less amounts already settled or written-off, except for recognised loans and receivables, which are measured at cost plus accrued interest, where interest is charged, less amounts already settled or written-off. 12 Payables Loans and payables are recognised in the statement of financial position at cost. 13 Capital Assets IPID I ANNUAL REPORT I 2016/2017 121 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 ACCOUNTING POLICIES for the year ended 31 March 2017 13.1 Movable capital assets Movable capital assets are initially recorded in the notes to the financial statements at cost. Movable capital assets acquired through a non-exchange transaction is measured at fair value as at the date of acquisition. Where the cost of movable capital assets cannot be determined reliably, the movable capital assets are measured at fair value and where fair value cannot be determined; the movable assets are measured at R1. All assets acquired prior to 1 April 2002 (or a later date as approved by the OAG) may be recorded at R1. Movable capital assets are subsequently carried at cost and are not subject to depreciation or impairment. Subsequent expenditure that is of a capital nature is added to the cost of the asset at the end of the capital project unless the movable asset is recorded by another department/entity in which case the completed project costs are transferred to that department. 14 Provisions and Contingents 14.1 Provisions Provisions are recorded in the notes to the financial statements when there is a present legal or constructive obligation to forfeit economic benefits as a result of events in the past and it is probable that an outflow of resources embodying economic benefits or service potential will be required to settle the obligation and a reliable estimate of the obligation can be made. The provision is measured as the best estimate of the funds required to settle the present obligation at the reporting date. 14.2 Contingent liabilities Contingent liabilities are recorded in the notes to the financial statements when there is a possible obligation that arises from past events, and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not within the control of the department or when there is a present obligation that is not recognised because it is not probable that an outflow of resources will be required to settle the obligation or the amount of the obligation cannot be measured reliably. 14.3 Commitments Commitments (other than for transfers and subsidies) are recorded at cost in the notes to the financial statements when there is a contractual arrangement or an approval by management in a manner that raises a valid expectation that the department will discharge its responsibilities thereby incurring future expenditure that will result in the outflow of cash. 15 Unauthorised expenditure Unauthorised expenditure is recognised in the statement of financial position until such time as the expenditure is either: • approved by Parliament or the Provincial Legislature with funding and the related funds are received; or • approved by Parliament or the Provincial Legislature without funding and is written off against the appropriation in the statement of financial performance; or • transferred to receivables for recovery. Unauthorised expenditure is measured at the amount of the confirmed unauthorised expenditure. 16 Fruitless and wasteful expenditure Fruitless and wasteful expenditure is recorded in the notes to the financial statements when confirmed. The amount recorded is equal to the total value of the fruitless and or wasteful expenditure incurred. Fruitless and wasteful expenditure is removed from the notes to the financial statements when it is resolved or transferred to receivables for recovery. Fruitless and wasteful expenditure receivables are measured at the amount that is expected to be recoverable and are derecognised when settled or subsequently written-off as irrecoverable. 17 Irregular expenditure Irregular expenditure is recorded in the notes to the financial statements when confirmed. The amount recorded is equal to the value of the irregular expenditure incurred unless it is impracticable to determine, in which case reasons therefor are provided in the note. Irregular expenditure is removed from the note when it is either condoned by the relevant authority, transferred to receivables for recovery or not condoned and is not recoverable. Irregular expenditure receivables are measured at the amount that is expected to be recoverable and are de-recognised when settled or subsequently written-off as irrecoverable. 122 IPID I ANNUAL REPORT I 2016/2017 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 ACCOUNTING POLICIES for the year ended 31 March 2017 18 Changes in accounting policies, accounting estimates and errors Changes in accounting policies that are affected by management have been applied retrospectively in accordance with MCS requirements, except to the extent that it is impracticable to determine the period-specific effects or the cumulative effect of the change in policy. In such instances the department shall restate the opening balances of assets, liabilities and net assets for the earliest period for which retrospective restatement is practicable. Changes in accounting estimates are applied prospectively in accordance with MCS requirements. Correction of errors is applied retrospectively in the period in which the error has occurred in accordance with MCS requirements, except to the extent that it is impracticable to determine the period-specific effects or the cumulative effect of the error. In such cases the department shall restate the opening balances of assets, liabilities and net assets for the earliest period for which retrospective restatement is practicable. 19 Events after the reporting date Events after the reporting date that are classified as adjusting events have been accounted for in the financial statements. The events after the reporting date that are classified as non-adjusting events after the reporting date have been disclosed in the notes to the financial statements. 20 Recoverable revenue Amounts are recognised as recoverable revenue when a payment made in a previous financial year becomes recoverable from a debtor in the current financial year. Amounts are either transferred to the National/Provincial Revenue Fund when recovered or are transferred to the statement of financial performance when written-off. 21 Related party transactions A related party transaction is a transfer of resources, services or obligations between the reporting entity and a related party. Related party transactions within the Minister/MEC’s portfolio are recorded in the notes to the financial statements when the transaction is not at arm’s length. Key management personnel are those persons having the authority and responsibility for planning, directing and controlling the activities of the department. The number of individuals and their full compensation is recorded in the notes to the financial statements. 22 Employee benefits The value of each major class of employee benefit obligation (accruals, payables not recognised and provisions) is disclosed in the Employee benefits note. IPID I ANNUAL REPORT I 2016/2017 123 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 NOTES TO THE ANNUAL FINANCIAL STATEMENT for the year ended 31 March 2017 1. Annual Appropriation 1.1 Annual Appropriation Included are funds appropriated in terms of the Appropriation Act (and the Adjustments Appropriation Act) for National Departments (Voted funds): 2016/17 2015/16 Final Appropriation Actual Funds Received Funds not requested/not received Final Appropriation Appropriation received R’000 R’000 R’000 R’000 R’000 Administration Investigation and Information Management 72 522 72 522 - 74 245 74 245 155 659 155 659 - 150 822 150 822 Legal Services 5 288 5 288 - 5 096 5 096 Compliance Monitoring and Stakeholder Management 8 642 8 642 - 4 618 4 618 242 111 242 111 - 234 781 234 781 Total 2. Departmental revenue Note 2016/17 2015/16 R’000 R’000 Sales of goods and services other than capital assets 2.1 98 Interest, dividends and rent on land 2.2 11 7 Transactions in financial assets and liabilities 2.3 176 64 Total revenue collected 285 161 Departmental revenue collected 285 161 2.1 90 Sales of goods and services other than capital assets Note 2016/17 2 R’000 2015/16 R’000 98 Sales of goods and services produced by the department Sales by market establishment Other sales 90 3 2 95 88 98 90 Sales of scrap, waste and other used current goods Total 2.2 Interest, dividends and rent on land Note 2016/17 2 R’000 2015/16 R’000 Interest 11 7 Total 11 7 2.3 Transactions in financial assets and liabilities Receivables Other Receipts including Recoverable Revenue Total 124 Note 2016/17 2 R’000 2015/16 R’000 115 16 61 48 176 64 IPID I ANNUAL REPORT I 2016/2017 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 NOTES TO THE ANNUAL FINANCIAL STATEMENT for the year ended 31 March 2017 3. Compensation of employees 3.1 Salaries and Wages Note Basic salary 2016/17 2015/16 R’000 R’000 115 941 100 333 1 718 2 029 966 413 Performance award Service Based Compensative/circumstantial Other non-pensionable allowances Total 3.2 4 242 5 621 24 392 21 784 147 259 130 180 Social contributions Note 2016/17 2015/16 R’000 R’000 Employer contributions Pension 14 962 13 052 Medical 6 930 6 302 Bargaining council Total Total compensation of employees 28 25 21 920 19 379 169 179 149 559 382 375 Average number of employees 4. Goods and services Note 2016/17 2015/16 R’000 Administrative fees Advertising Minor assets 4.1 Bursaries (employees) Catering Communication Computer services 4.2 Consultants: Business and advisory services Legal services Contractors Agency and support / outsourced services Audit cost – external 4.3 Fleet services Consumables 4.4 Operating leases R’000 757 660 232 520 157 985 155 125 199 220 5 250 3 919 8 856 5 636 330 506 1 015 2 300 495 302 - 64 2 173 3 396 4 460 5 726 1 311 2 260 13 242 20 401 Property payments 4.5 10 130 9 559 Travel and subsistence 4.6 19 086 22 779 Venues and facilities 421 13 Training and development 657 524 Other operating expenditure Total IPID I ANNUAL REPORT I 2016/2017 4.7 1 803 1 722 70 729 81 617 125 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 NOTES TO THE ANNUAL FINANCIAL STATEMENT for the year ended 31 March 2017 4.1 Minor assets Note 2016/17 2015/16 4 R’000 R’000 Tangible assets Machinery and equipment Total 4.2 157 985 157 985 157 985 Computer services Note 2016/17 2015/16 4 R’000 R’000 SITA computer services 2 513 1 557 External computer service providers 6 343 4 079 Total 8 856 5 636 4.3 Audit cost – External Note 2016/17 2015/16 4 R’000 R’000 Regularity audits 1 923 Computer audits Total 3 258 250 138 2 173 3 396 4.4 Consumables Note 2016/17 2015/16 4 R’000 R’000 Consumable supplies Uniform and clothing Household supplies IT consumables 100 182 78 35 362 628 758 1 419 1 311 2 260 Stationery, printing and office supplies 4.5 841 1 8 Other consumables Total 553 Property payments Note 2016/17 2015/16 4 R’000 R’000 Municipal services 3 031 2 725 152 138 Property management fees Other 6 947 6 696 Total 10 130 9 559 4.6 Travel and subsistence Local Foreign Total 126 Note 2016/17 2015/16 4 R’000 R’000 18 812 22 697 274 82 19 086 22 779 IPID I ANNUAL REPORT I 2016/2017 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 NOTES TO THE ANNUAL FINANCIAL STATEMENT for the year ended 31 March 2017 4.7 Other operating expenditure Note 2016/17 2015/16 4 R’000 R’000 Professional bodies, membership and subscription fees Resettlement costs 15 9 679 314 Other 1 109 1 399 Total 1 803 1 722 The disclosed amount of R1 109 under Other, represent the expenditure incurred on insurance for subsidised vehicles, courier printing and publication services on the Directorate’s strategic documents. 5. Payments for financial assets Note 2016/17 2015/16 R’000 Debts written off R’000 5.1 Total 5.1 93 2 93 2 Debts written off Note 2016/17 2015/16 5 R’000 R’000 Nature of debts written off Recoverable revenue written off Interest on overdue account - 2 Total - 2 Debt written off Irrecoverable debts that have prescribed 93 - Total 93 - Total debt written off 93 2 Other debt written off 6. Transfers and subsidies 2016/17 2015/16 R’000 R’000 Note Departmental agencies and accounts Annex 1B 549 364 Households Annex 1G 895 259 1 444 623 Total 7. Expenditure for capital assets Note Tangible assets Machinery and equipment Total IPID I ANNUAL REPORT I 2016/2017 27 2016/17 2015/16 R’000 R’000 286 2 356 286 2 356 286 2 356 127 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 NOTES TO THE ANNUAL FINANCIAL STATEMENT for the year ended 31 March 2017 7.1 Analysis of funds utilised to acquire capital assets – 2016/17 Voted funds Aid assistance Total R’000 R’000 R’000 Tangible assets Machinery and equipment Total 7.2 286 - 286 286 - 286 Analysis of funds utilised to acquire capital assets – 2015/16 Voted funds Aid assistance Total R’000 R’000 R’000 Tangible assets Machinery and equipment Total 8. Unauthorised expenditure 8.1 Reconciliation of unauthorised expenditure 2 356 2 356 2 356 - 2 356 2 356 - 2 356 Note 2016/17 2015/16 8 R’000 R’000 Opening balance 891 Prior period error - 891 As restated 891 891 Closing balance 891 891 An amount disclosed relates to the previous Financial year’s expenditures that still awaits authorisation by SCOPA. 8.2 Analysis of unauthorised expenditure awaiting authorisation per economic classification 2016/17 2015/16 R’000 R’000 Current 891 891 Total 891 891 8.3 Analysis of unauthorised expenditure awaiting authorisation per type 2016/17 2015/16 R’000 R’000 Unauthorised expenditure relating to overspending of the vote or a main division within a vote 891 891 Total 891 891 9. Cash and cash equivalents Note 2016/17 2015/16 R’000 R’000 Cash on hand - 1 Total - 1 Cash on hand represent the Petty Cash bank balance as at the reporting date. 128 IPID I ANNUAL REPORT I 2016/2017 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 NOTES TO THE ANNUAL FINANCIAL STATEMENT for the year ended 31 March 2017 10. Prepayments and advances 2016/17 R’000 Note Staff advances Travel and subsistence Total 2015/16 R’000 22 3 25 23 9 32 11. Receivables Current R’000 Claims recoverable Recoverable expenditure Staff debt Total Note 11.1 11.2 11.3 2016/17 Non-current R’000 303 123 426 1 1 2 Total R’000 2015/16 Non-current R’000 Current R’000 303 1 124 428 36 10 4 50 Total R’000 74 3 77 36 84 7 127 11.1 Claims recoverable Note 11 and Annex 4 2016/17 R’000 2015/16 R’000 National departments 303 36 Total 303 36 11.2 Recoverable expenditure (disallowance accounts) Note 15 2016/17 R’000 Debt Account Debt Receivable Income Total 2015/16 R’000 9 (8) 144 (60) 1 84 11.3 Staff debt Note 11 2016/17 R’000 Sal: Tax Debt Sal: Deductions Disallowance CA Sal: Reversal Control Acc T&S Advance Foreign Total 2015/16 R’000 1 123 124 4 3 7 11.4 Fruitless and wasteful expenditure Note 11 Opening balance Less amounts recovered Transfers from note 32 Fruitless and Wasteful Expenditure Total 2016/17 R’000 2015/16 R’000 - (4) 4 - The above amount represents a refund that was made by the Supplier who overcharged the Department. IPID I ANNUAL REPORT I 2016/2017 129 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 NOTES TO THE ANNUAL FINANCIAL STATEMENT for the year ended 31 March 2017 11.5 Impairment of receivables Note 2016/17 2015/16 R’000 R’000 Estimate of impairment of receivables - 36 Total - 36 Impairment was taken into account the amount already written-off. 12. Voted funds to be surrendered to the Revenue Fund Note 2016/17 2015/16 R’000 R’000 Opening balance 624 (2 840) As restated 624 (2 840) Transfer from statement of financial performance (as restated) 380 624 (624) 2 840 380 624 Paid during the year Closing balance 13. Departmental revenue and NRF Receipts to be surrendered to the Revenue Fund Note 2016/17 2015/16 R’000 R’000 Opening balance 13 As restated 13 7 285 161 (288) (155) 10 13 Transfer from Statement of Financial Performance (as restated) Paid during the year 7 Closing balance 14. Bank Overdraft Note 2016/17 2015/16 R’000 R’000 Consolidated Paymaster General Account 871 252 Total 871 252 15. Payables – current Note 2016/17 2015/16 R’000 R’000 Amounts owing to other entities Clearing accounts Total 130 15.1 83 162 83 162 IPID I ANNUAL REPORT I 2016/2017 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 NOTES TO THE ANNUAL FINANCIAL STATEMENT for the year ended 31 March 2017 15.1 Clearing accounts Note 2016/17 2015/16 21 R’000 R’000 Sal: Income Tax Sal: Pension Total 76 150 7 12 83 162 16. Net cash flow available from operating activities Note 2016/17 2015/16 R’000 R’000 Net surplus/(deficit) as per Statement of Financial Performance 665 785 Add back non cash/cash movements not deemed operating activities (999) 2 605 (Increase)/decrease in receivables – current (301) (27) (Increase)/decrease in prepayments and advances 7 490 (79) (2 899) Expenditure on capital assets 286 2 356 Surrenders to Revenue Fund (912) 2 685 Voted funds not requested/not received - - Own revenue included in appropriation - - (334) 3 390 Increase/(decrease) in payables – current Net cash flow generated by operating activities 17. Reconciliation of cash and cash equivalents for cash flow purposes Note 2016/17 2015/16 R’000 R’000 Consolidated Paymaster General account (871) Cash on hand Total (252) - 1 (871) (251) 18. Contingent liabilities and contingent assets 18.1 Contingent liabilities Note 2016/17 2015/16 R’000 R’000 Liable to Nature Claims against the department Annex 3B Intergovernmental payables (unconfirmed balances) Annex 5 Total 57 275 41 480 549 1 903 57 824 43 383 Contingent liability disclosed relates to litigation against the department through summons and letter of demands, it is uncertain on when the amount and timing of outflow will happen due to the fact that some cases are still at various stages in courts. All cases disclosed above are claims against the Department, therefore reimbursement is not expected. IPID I ANNUAL REPORT I 2016/2017 131 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 NOTES TO THE ANNUAL FINANCIAL STATEMENT for the year ended 31 March 2017 Due to the nature of IPID business, the Department experienced a high number of litigation cases which comes with summons and letter of demands. Full description of each case is provided in the Annexure 3B of the Annual Financial Statements; however, it is impractical to provide an indication of the uncertainties relating to the amount or timing of any outflow in all disclosed cases. 19. Commitments Note 2016/17 2015/16 R’000 R’000 Current expenditure Approved and contracted 1 286 1 854 1 286 1 854 Total Commitments 1 286 1 854 The commitment reported includes a cleaning services contract for National Office that was awarded in March 2017 for the period of 24 months. Going Concern Management Assessments: Over the past financial years, the IPID has experienced numerous budget cuts which have resulted in the Goods and Services budget been drastically reduced to extend of not meeting the Directorate’s contractual obligations and its performance targets. The referred budget cuts were so extensive that the Directorate could not even afford to budget for the replacement of its operational equipment which was no longer functional. The trend of extensive budget cuts experienced by IPID has resulted in a significant increase in the accruals of R5 342 000 in the financial year 2014/15, R6 858 000 in 2015/16 and R24 023 000 in 2016/17.There is a material uncertainty related to events or conditions that may cast significant doubt on the department’s ability to continue as a going concern and, therefore, that it may be unable to realise its assets and discharge its liabilities in the normal course of business. Various Stakeholders including National Treasury and the Minister of Police have been engaged to assist the Department with additional funding in order to address the reported cost pressure areas. The allocation of additional funding to the IPID will not only address the increased accruals but also the insufficient capacity in various key units. 20. Accruals and payables not recognised 20.1 Accruals 2016/17 2015/16 R’000 R’000 Total Total Listed by economic classification 30 Days Goods and services 30+ Days 6 245 17 399 23 644 6 858 Other 96 283 379 - Total 6 341 17 682 24 023 6 858 Note 2016/17 2015/16 R’000 R’000 Listed by programme level Administration 13 449 4 016 Investigation and Information Management 10 310 2 809 156 12 Legal Services Compliance Monitoring and Stakeholder Management Total 108 21 24 023 6 858 Due to the Budget constraints, not all the invoices for services rendered were settled within the financial year under review hence the reported accruals; however, the department entered in an agreement with affected Suppliers and payments of the received invoices were deferred to the next financial year. 132 IPID I ANNUAL REPORT I 2016/2017 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 NOTES TO THE ANNUAL FINANCIAL STATEMENT for the year ended 31 March 2017 Note Included in the above totals are the following: 2016/17 2015/16 R’000 R’000 Confirmed balances with other departments Annex 5 2 458 630 Confirmed balances with other government entities Annex 5 11 749 280 14 207 910 Total The increased confirmed balances in 2016/17 were mainly due to the accruals caused by budget constraints. 21. Employee benefits Note 2016/17 2015/16 R’000 R’000 Leave entitlement 7 146 7 693 Service bonus (Thirteenth cheque) 4 695 4 410 Performance awards 1 697 1 850 Capped leave commitments 3 870 4 275 Other 148 56 Total 17 556 18 284 The Leave entitlement has a negative leave balance of R88 346.62 which represents 60.22 negative balances for a total of 27 officials at reporting date, 31 March 2017. In comparison with the previous Financial year, 2015/16, the amount reported was R125 636.89 which represents 76.83 negative leave balances for a total of 26 Officials. Leave Entitlement for both financial years also includes current and prior years’ cycle’s liabilities. Service Bonus liability is a systematically PERSAL calculation which reconcile with the formula according to the DPSA Financial Manual. The Performance Awards are based on the previous payment made since the performance assessments have not been concluded by the reporting date. Long service awards provision for all officials who have 20 and 30 years are disclosed as ‘’other’’ under Employee benefits. 22. Lease commitments 22.1 Operating leases expenditure 2016/17 Specialised military equipment Not later than 1 year Buildings and other fixed structures Land - - Machinery and equipment - Total 133 133 Later than 1 year and not later than 5 years - - - 16 16 Total lease commitments - - - 149 149 2015/16 Not later than 1 year Specialised military equipment Buildings and other fixed structures Land - - Machinery and equipment - 345 Total 345 Later than 1 year and not later than 5 years - - - 146 146 Total lease commitments - - - 491 491 The Office Buildings’ leases are based on the arrangements that have been made by DPW and the Landlords on behalf of IPID. The contractual obligation is also between the two referred parties and there is no sub-lease between IPID and DPW. Prior year amounts have been derecognised on the basis of the adopted principle in the year under review. IPID I ANNUAL REPORT I 2016/2017 133 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 NOTES TO THE ANNUAL FINANCIAL STATEMENT for the year ended 31 March 2017 23. Irregular expenditure a. Reconciliation of irregular expenditure Note 2016/17 2015/16 R’000 R’000 Opening balance As restated Add: Irregular expenditure – relating to prior year 2 565 527 2 565 527 12 678 - 6 289 2 069 Add: Irregular expenditure – relating to current year Less: Prior year amounts condoned Closing balance - (31) 21 532 2 565 6 289 2 060 Analysis of awaiting condonation per age classification Current year Prior years 15 243 505 Total 21 532 2 565 b. Details of irregular expenditure – added current year (relating to current and prior years) Incident Disciplinary steps taken/criminal proceedings 2016/17 R’000 Non-compliance with Public Service Act and Public Service Regulations in appointment of the Chief Director: Corporate Service The matter has been reported for legal action against the affected parties. 451 Payment made exceeded the approved deviated amount  Request for approval of different amount will be submitted to the Accounting Officer 155 Quotations awarded not in accordance with the prescribed preference point system  The verification process has been strengthened in SCM 303 Contract extensions not justifiable and exceeding 15% of original contracts without approval by National Treasury The submission will be made to National Treasury to consider the extended amount of the contract. 610 Contract extensions not justifiable To request National Treasury to consider the reasons that led to the contract extensions for regularisation 4 770 Total 6 289 24. Fruitless and wasteful expenditure a. Reconciliation of fruitless and wasteful expenditure Note 2016/17 2015/16 R’000 R’000 Opening balance 314 321 As restated 314 321 Fruitless and wasteful expenditure – relating to current year 3 234 2 Less: Amounts resolved (314) (5) - (4) 3 234 314 Less: Amounts transferred to receivables for recovery Closing balance 134 11.4 IPID I ANNUAL REPORT I 2016/2017 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 NOTES TO THE ANNUAL FINANCIAL STATEMENT for the year ended 31 March 2017 b. Analysis of awaiting resolution per economic classification 2016/17 2015/16 R’000 R’000 Current 3 234 314 Total 3 234 314 c. Analysis of Current year’s fruitless and wasteful expenditure Incident Disciplinary steps taken/criminal proceedings 2016/17 Interest charged on outstanding Telkom account. The matter was reported to the Financial Misconduct Committee 2 Incorrect Kilometers claimed by officials The case is under investigation 4 Official incurred accommodation costs and claimed S&T without confirmation of attendance for training (Limpopo) and Double bookings of hotel accommodation (KZN) The matter was reported to the Financial Misconduct Committee 5 Payment of arrears and penalties on state vehicle: DVN 806 EC for late renewal of licence disc. The matter was reported to the Financial Misconduct Committee 5 Cancellation of a non-refundable bus ticket Limpopo. The matter was reported to the Financial Misconduct Committee 1 Advertisement of a vacant position not on approved organisational structure. The matter was reported to the Financial Misconduct Committee 14 Penalty fees on changing the flight date. The matter was reported to the Financial Misconduct Committee 1 Penalty fees on late renewal of TV licence. The matter was reported to the Financial Misconduct Committee 1 Expenditure incurred on re-organisation process. The matter was reported to the Financial Misconduct Committee 1 931 Suspension of Chief Director - Corporate Services. The matter was reported to the Financial Misconduct Committee 1 270 R’000 Total 3 234 25. Related party transactions List of related party relationships 1. South African Police Services (SAPS) - Reporting to same Minister 2. Private Security Industry Regulation Authoring (PSIRA) - Reporting to the same Minister 3. Civilian Secretariat of Police - Reporting to the same Minister 26. Key management personnel No. of Individuals 2016/17 2015/16 R’000 R’000 Officials: Level 15 to 16 1 1 753 1 393 Level 14 (incl. CFO if at a lower level) 14 15 311 14 824 Family members of key management personnel Total IPID I ANNUAL REPORT I 2016/2017 1 422 618 17 486 16 835 135 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 NOTES TO THE ANNUAL FINANCIAL STATEMENT for the year ended 31 March 2017 27. Movable Tangible Capital Assets MOVEMENT IN MOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED 31 MARCH 2017 Opening balance Value adjustments Additions Disposals Closing Balance R’000 R’000 R’000 R’000 R’000 MACHINERY AND EQUIPMENT Transport assets Computer equipment 43 390 - 286 329 8 719 - - - 43 347 8 719 21 385 - 129 329 21 185 Furniture and office equipment 9 921 - 25 - 9 946 Other machinery and equipment 3 365 - 132 - 3 497 43 390 - 286 329 43 347 TOTAL MOVABLE TANGIBLE CAPITAL ASSETS Movable Tangible Capital Assets under investigation Number Value R’000 Included in the above total of the movable tangible capital assets per the asset register are assets that are under investigation: Machinery and equipment 31 2 214 In communication with G-Fleet on transfer and acceptance of vehicles and late reported lost assets items. 27.1 Additions ADDITIONS TO MOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED 31 MARCH 2017 Cash* Non-cash** R’000 (Capital Work in Progress current costs and finance lease payments) R’000 R’000 Total Received current, not paid (Paid current year, received prior year) R’000 R’000 MACHINERY AND EQUIPMENT 286 Computer equipment 129 - - - 129 25 - - - 25 Other machinery and equipment 132 - - - 132 TOTAL ADDITIONS TO MOVABLE TANGIBLE CAPITAL ASSETS 286 - - - 286 Furniture and office equipment 136 286 IPID I ANNUAL REPORT I 2016/2017 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 NOTES TO THE ANNUAL FINANCIAL STATEMENT for the year ended 31 March 2017 27.2 Disposals DISPOSALS OF MOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED 31 MARCH 2017 Sold for cash Non-cash disposal Total disposals Cash Received Actual R’000 R’000 R’000 R’000 MACHINERY AND EQUIPMENT Computer equipment - TOTAL DISPOSAL OF MOVABLE TANGIBLE CAPITAL ASSETS 329 329 329 329 - 27.3 Movement for 2015/16 MOVEMENT IN TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED 31 MARCH 2016 Opening balance Prior period error Additions Disposals Closing Balance R’000 R’000 R’000 R’000 R’000 MACHINERY AND EQUIPMENT 42 197 Transport assets - 1 259 (66) 43 390 8 719 - - - 8 719 20 964 - 421 - 21 385 Furniture and office equipment 9 599 - 388 (66) 9 921 Other machinery and equipment 2 915 - 450 - 3 365 42 197 - 1 259 (66) 43 390 Computer equipment TOTAL MOVABLE TANGIBLE CAPITAL ASSETS 27.4 Minor assets MOVEMENT IN MINOR ASSETS PER THE ASSET REGISTER FOR THE YEAR ENDED AS AT 31 MARCH 2017 Specialised military assets Intangible assets Heritage assets Machinery and equipment Biological assets Total R’000 R’000 R’000 R’000 R’000 R’000 Opening balance - - - 12 826 - 12 826 Additions - - - 150 - 150 Disposals - - - 171 - 171 TOTAL MINOR ASSETS - - - 12 805 - 12 805 Specialised military assets Number of minor assets at cost - Intangible assets Heritage assets - Machinery and equipment - TOTAL NUMBER OF MINOR ASSETS Biological assets 7 606 Total - 7 606 7 606 7 606 Minor Capital Assets under investigation Number Value R’000 Included in the above total of the minor capital assets per the asset register are assets that are under investigation: Machinery and equipment 3 8 Assets reported as losses which were still under verification by the reporting date. IPID I ANNUAL REPORT I 2016/2017 137 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 NOTES TO THE ANNUAL FINANCIAL STATEMENT for the year ended 31 March 2017 MOVEMENT IN MINOR ASSETS PER THE ASSET REGISTER FOR THE YEAR ENDED AS AT 31 MARCH 2016 Specialised military assets Intangible assets Heritage assets Machinery and equipment Biological assets Total R’000 R’000 R’000 R’000 R’000 R’000 Opening balance - - - Additions - - Disposals - - TOTAL MINOR ASSETS - - Specialised military assets Number of minor assets at cost TOTAL NUMBER OF MINOR ASSETS 138 - Intangible assets 12 685 - - 285 - 285 - (144) - (144) - 12 826 - 12 826 Heritage assets - Machinery and equipment - 7 560 7 560 Biological assets 12 685 Total - 7 560 7 560 IPID I ANNUAL REPORT I 2016/2017 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 ANNEXURE 1B STATEMENT OF TRANSFERS TO DEPARTMENTAL AGENCIES AND ACCOUNTS TRANSFER ALLOCATION TRANSFER Adjusted DEPARTMENT/ AGENCY/ ACCOUNT Appropriation Adjustments Roll Overs Actual Transfer Total Total Available 2015/16 % of Available funds Transferred Appropriation Act R’000 R’000 R’000 R’000 R’000 % R’000 535 - - 535 535 100% 354 14 - - 14 14 100% 10 549 - - 549 549 SASSETA Communication: Licences (Radio &TV) TOTAL 364 An amount of R535 000 has been transferred to SASSETA in accordance with the signed Service Level Agreement for skills development of Staff. ANNEXURE 1G STATEMENT OF TRANSFERS TO HOUSEHOLDS TRANSFER ALLOCATION EXPENDITURE Adjusted Appropriation Act HOUSEHOLDS Roll Overs R’000 Adjustments R’000 Total Available R’000 % of Available funds Transferred Actual Transfer R’000 2015/16 R’000 Appropriation Act % R’000 Transfers Leave Gratuity Claims against the state Act of grace remuneration TOTAL 54 - - 54 54 100% 179 831 - - 831 831 100% 70 10 - - 10 10 100% 10 895 - - 895 895 259 ANNEXURE 1H STATEMENT OF GIFTS, DONATIONS AND SPONSORSHIPS RECEIVED NAME OF ORGANISATION NATURE OF GIFT, DONATION OR SPONSORSHIP 2016/17 2015/16 R’000 R’000 Received in kind Travel with Flair 25 desk calendars - 2 Public Servants Association Embassy of the United States of America Travelling Bags for Investigative Indaba 17 - Investigative Training 26 - 43 2 Subtotal TOTAL IPID I ANNUAL REPORT I 2016/2017 139 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 ANNEXURE 1J STATEMENT OF GIFTS, DONATIONS AND SPONSORSHIPS MADE NATURE OF GIFT, DONATION OR SPONSORSHIP (Group major categories but list material items including name of organisation 2016/17 2015/16 R’000 R’000 Made in kind Donation of redundant office furniture to various identified schools - 195 Donation of redundant furniture to South African National Defence Force - 10 TOTAL - 205 140 IPID I ANNUAL REPORT I 2016/2017 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 ANNEXURE 3B STATEMENT OF CONTINGENT LIABILITIES AS AT 31 MARCH 2017 Opening Balance  Liabilities incurred during the year Liabilities paid/ cancelled/ reduced during the year R’000 R’000 1 April 2016 Nature of Liability Claims against the department R’000   Liabilities recoverable (Provide details hereunder) R’000 Closing Balance 31 March 2017 R’000           North West Mafikeng - SM Matshe vs Minister of Police 300 - 300   - - General Mpembe vs Minister of Police 750 - - - 750 Richard Nziyane vs Minister of Police 480 - - - 480 Moiloa & Others vs Minister of Police 960 - - - 960 Ngobeni vs Minister of Police 1 000 - - - 1 000 Modutoane vs Minister of Police 1 000 - - - 1 000 Ntshangase vs Minister of Police 1 000 - - - 1 000 Poswa vs The Executive Director of IPID and Others Mlangeni vs Minister of Police and Others Booysen Johan Wessel 800 - 800 - - 1 000 - - - 1 000 10 500 - - - 10 500 Mathata MZ 1 000 1 725 - - 2 725 Mabotja TA 1 000 1 725 - - 2 725 Mabuda LS 120 11 - - 131 1 750 158 - - 1 908 Mzwana SS 400 - - - 400 FJ Engelbrecht 200 - - - 200 M W Ramatlou - 8 160 - - 8 160 Boitumelo Ramahlaha vs Minister of Police and Mapheto L Nowele - 24 - - 24 M Ngobese - 200 91 - 109 PSA obo Mphago & Others vs IPID - 819 819 - - Lekatela Collins Sekwadi v Minister of Police - 2 218 - - 2 218 PSA obo Wagenaar and IPID - 12 12 - - 14 979 2 322 - - 17 301 13 - - - 13 3 - - - 3 KE Sons Investments CC Santam Insurance on behalf of MKB Tactical (Pty) Ltd Karelse vs Minister of Police Netshapala Mukondoleli Lesley vs Minister of Police 500 270 - - 770 Munsami Yogandran vs Minister of Police 520 174 - - 694 5 - - - 5 Human Communication Recruitment vs Minister of Police Mkhize vs IPID and Another Mapheto vs Minister of Police Moabelo vs Executive Director of IPID 200 - 200 - - 3 000 - - - 3 000 - 200 - - 200 - 57 275   TOTAL IPID I ANNUAL REPORT I 2016/2017 41 480   18 017 2 222   141 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 1. Revision of opening balance and an interest of 9% have been added on Mathata MZ matter in accordance to the court summons. 2. Revision of opening balance and an interest of 9% has been added Mabotja TA matter in accordance to the court summons. 3. An interest of 9% which has been added on Mabuda LS matter in accordance to the court summons. 4. An interest of 9% which has been added on Boitumelo Ramahlaha vs Minister of Police and Mapheto matter in accordance to the court summons. 5. An interest of 15.5% has been added on KE Sons Investments CC matter case in accordance to the court summons. 6. An interest of 15.5% for 3 years has been added on Netshapala Mukondoleli Lesley vs Minister of Police matter in accordance to the court summons. 7. An interest of 15.5% for 2 years has been added on Munsami Yogandran vs Minister of Police matter in accordance to the court summons. 142 IPID I ANNUAL REPORT I 2016/2017 IPID I ANNUAL REPORT I 2016/2017 - Department of Planning , Monitoring and Evaluation Department of Social Development South African Police Services Department of Environmental Affairs Department of Telecommunication and Postal Services Department of Home Affairs Office of the Chief Justice National Treasury Department of Justice and Constitutional Development TOTAL - - - - - - - - - - - - R’000 303 23 15 17 19 43 1 132 - - - 53 31/03/2017 R’000 1 9 36 - - - - - - - 4 22 31/03/2016 Unconfirmed balance outstanding R’000 303 23 15 17 19 43 1 132 - - - 53 R’000 1 9 36 - - - - - - - 4 22 31/03/2016 Total 31/03/2017 The above disclosed amounts relate to the salary claims for transferred Officials between IPID and the listed various Departments. - R’000 R’000 Department of Public Service Commission 31/03/2016 31/03/2017 Confirmed balance outstanding Department of Correctional Services Department Government Entity CLAIMS RECOVERABLE ANNEXURE 4 - - - - - - - - - - - - Receipt date up to six (6) working days after year end R’000 Amount Cash in transit at year end 2016/17 * - - - - - - - - - - - - ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 143 144 6 - 11 910 - - - - - - - 549 549 31/03/2017 R’000 - 1 903 1 765 - 1 765 - 138 - 138 - 31/03/2016 R’000 Unconfirmed balance outstanding - 14 756 12 298 7 693 4 522 76 7 2 458 11 2447 - 31/03/2017 R’000 2 813 2 045 - 12 1 883 150 768 6 - 633 15 24 77 13 31/03/2016 R’000 TOTAL - - - - - - - - Cash in transit at year end 2016/17* Payment date up to six (6) working days before year end Amount R’000 - - - - - - - - SARS and GPAA disclosed amounts relates to Employees tax and pensions deductions that happened through PERSAL interface whilst g-FleeT, DPW and Justice‘ amounts relate to the outstanding invoices for services rendered but not paid in the financial year under review due to the budget constraints. 14 207 TOTAL - 7 693 280 118 3 973 11 749 150 12 76 7 630 495 15 24 2 447 - 2 458 77 13 31/03/2016 R’000 - 31/03/2017 R’000 Confirmed balance outstanding Subtotal OTHER GOVERNMENT ENTITY Current South African Revenue Services (SARS) Government Pensions Administration Agency (GPAA) g-FleeT Management Property Management Trading Entity (DPW) TOTAL DEPARTMENTS Current South African Police Services (SAPS) Department of Public Works and Roads (DPWR) Department of Justice and Constitutional Development Department of Water Affairs Department of Mineral Resources Department of Social Development - Limpopo Province Department of Energy GOVERNMENT ENTITY INTER-GOVERNMENT PAYABLES ANNEXURE 5 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2017 IPID I ANNUAL REPORT I 2016/2017 Head Office Physical Address: City Forum Building, 114 Madiba (Vermeulen) Street Postal Address: Private Bag x 941, Pretoria, 0001 Tel: 012 399 0000 Fax: 012 326 0408 E-mail: complaints@ipid.gov.za Website: www.ipid.gov.za RP243/2017 ISBN: 978-0-621-45708-7