2012/2013 IN YEAR FINANCIAL MONITORING REPORT

FOR THE PERIOD: 01st

JULY 2012 to 30th

JUNE 2013

FOURTH QUARTER

2

TABLE OF CONTENTS 1. Introduction….............................................................................................5 2. Executive Summary...................................................................................6-8 3. Financial Performance (Expenditure & Revenue)....................................9-23 4. Capital Budget Performance………………………..…………….….………24-29 5. Cash Flow Position.....................................................................................30-33 6. Current Bank Balance, Investment and Borrowing......................................34-35 7. Performance on main tariff revenue collection……………………………......36-46

3

IN-YEAR BUDGET STATEMENT TABLES: JUNE 2013 REPORT

The financial results for the period ended 30th June 2013 (the 12th month of the 2012/2013 financial year) are attached consisting of the following tables, in Annexure A and Annexure B:

ANNEXURE A: 1) Table C1: Monthly Budget Statement – Summary 2) Table C2: Monthly Budget Statement – Financial Performance (standard

classification) 3) Table C3: Monthly Budget Statement - Financial Performance (Revenue and

Expenditure by Municipal vote) 4) Table C4: Monthly Budget Statement – Financial Performance (Revenue and

Expenditure) 5) Table C5: Monthly Budget Statement - Capital Expenditure by vote, standard

classification and funding 6) Table C6: Monthly Budget Statement – Financial Position 7) Table C7: Monthly Budget Statement – Cash Flow

ANNEXURE B: 1) Table SC1: Material variance explanations 2) Table SC2: Monthly Budget Statement – Performance Indicators 3) Table SC3: Monthly Budget Statement - Aged Debtors 4) Table SC4: Monthly Budget Statement - Aged Creditors 5) Table SC5: Monthly Budget Statement – Investment Portfolio 6) Table SC6: Monthly Budget Statement – Transfer and grant receipts 7) Table SC7: Monthly Budget Statement – Transfer and grant expenditures 8) Table SC8: Monthly Budget Statement – Councillor and Staff Benefits 9) Table SC9: Monthly Budget Statement – Actual and Revised targets for cash

receipts 10) Table SC12: Monthly Budget Statement – Capital Expenditure Trend 11) Table SC13a: Monthly Budget Statement – Capital expenditure on new assets by

asset class 12) Table SC13b: Monthly Budget Statement – Capital expenditure on renewal of

existing assets by asset class 13) Table SC13c: Monthly Budget Statement – Capital expenditure on repairs and

maintenance by asset class 14) Table SC13d: Monthly Budget Statement – Depreciation by asset class 15) Municipal manager’s quality certification

4

ANNEXURE A:

1) Table 1: Capital Expenditure to date – by Capital Projects 2) Table 2: Capital Expenditure to date – payments from Cash Flow 3) Table 3: Activity Report 4) Table 4: Staff Arrears Service Accounts 5) Table 5: Councillors Service Accounts 6) Table 6: Investment Register 7) Table 7: Loan Register 8) Table 8: Quarterly Withdrawal Bank Statement

5

1. INTRODUCTION

1.1 PURPOSE

The purpose of this report is to inform Council about the Financial Status quo of Mogale City Local Municipality and to comply with Sections 71 of the MFMA and the requirements as promulgated in the Government Gazette No 32141 of 17th April 2009.

1.2 STRATEGIC OBJECTIVE The application of sound financial management principles for the compilation of Mogale City’s financial plan is essential and critical to ensure that municipality remains financial viable and those sustainable municipal services are provided economically and equitably to all communities.

1.3 BACKGROUND

Section 52(d) and Section 71 of the MFMA and in terms of Section 28 of the Government Notice 32141 dated 17 April 2009, regarding the “ Local Government: Municipal Finance Management Act 2003 Municipal Budget and Regulations” necessitates that specific financial particulars be reported on and in the format prescribed. “Section 52(d) of the MFMA states that the mayor of the municipality must, within 30 days of the end of each quarter, submit a report to the council on the implementation of the budget and the financial state of affairs of the municipality;” “Section 71 (1) of the MFMA states that, The accounting officer of a municipal must by no later than 10 working days after the end of each month submit to the mayor of the municipality and the relevant provincial treasury a statement in the prescribed format on the state of the municipality’s budget reflecting the following particulars for that month and for the financial year up to the end of that month.” “Section 28 of the Government Notice 32141, the monthly budget statement of a municipality must be in the format specified in Schedule C and include all required tables, charts and explanatory information, taking into account any guidelines issued by the Minister in terms of section 168(1) of the Act.”

6

2. EXECUTIVE SUMMARY 2.1 SUMMARY STATEMENT OF FINACIAL PERFORMANCE Table 1: Operational Budget performance for the year to 30th June 2013

2012/2013 Approved

Adjustment Budget

R 000

Actual income/spend to date (in R and as a

% of the Approved Adjustment Budget)

R 000 %

Pro-rata

Budget to date

R 000

Under/ over

spend against Pro rata budget

R 000

Actual income/ spent as % of pro

rata budget

Revenue 1 700 259 1 693 140 100% 1 700 259 (7 120) 100%

Expenditure cash items (1 702 828) (1 526 942) 90% (1 702 828) (175 886) 90%

Expenditure non-cash items (depreciation, debt impairment and others)

(309 696) (282 400) 91% (282 400) (27 296) 91%

TOTAL EXPENDITURE (2 012 524) (1 809 342) 90% (2 012 524) (203 182) 90%

SURPLUS/ (DEFICIT)

(312 264)

(116 202)

7%

(312 265)

196 063

12%

Note: Positive (Expenditure) & Negative Revenue

2.1.1 During the 2012/13 financial year we anticipated to raise R1 762 640 480 in billed revenue and operational grants, this amount was revised to an amount of R1 700 259 791 excluded here is the capital grants amounting to a total of R119 870 700, and this has also been revised to R 127 972 715.

2.1.2 In line with the formats prescribed by the Municipal Budget and Reporting Regulations, capital transfers and contributions are excluded from the operating statement, as inclusion of these revenue sources would distort the calculation of the operating surplus/ (deficit).

2.1.3 The summary of statement of financial performance in Annexure A, Table C4, is prepared on a similar basis to the prescribed budget format, detailing revenue by source type and expenditure by input type.

2.1.4 To date, a total of R 1 809 342 billion has been spent on the operational

approved budget this includes non-cash items, (this represent 90% of the total approved expenditure budget for the year or 90% of the pro rata budget). These figures include non-cash items such as depreciation, debt impairment, year-end provisions and municipal charges.

7

2.1.5 To date a total revenue of R1 693 140 billion has been recorded

(representing 100% of the total approved adjustment revenue budget for the year or 100% pro rata budget), this amount is made up of revenue billed from main tariffs and revenue from other sources amounting to R1 259 282 million and R433 858 million respectively. Section 2 of this report gives more detail on the Operational Budget Performance.

2.1.6 The revenue shown on table 2.1.8. below is largely the amount of revenue

billed for the year to date of R1 259 282 million, representing 74% of the total revenue, it should also be noted that of the total revenue received, an amount R340 928 million came from operational grants, this actually translates into R92 930 million being revenue from other sources, which represents 5% of the total income.

2.1.7 The amount of actual cash collected or received for the main tariffs is an

amount R1 180 504 million (representing 94% of the billed revenue) as shown on table 2.1.8 and in detail on section 7 of this report.

Chart 1 Monthly Expenditure Trends

Note: This chart includes depreciation and debt impairment which are non-cash items

The chart above shows that R190 881 million was spent for the month of June 2013.

8

Table 1.1 Monthly Creditors age analysis – M12 June

Budget Year 2012/13

Detail

0 - 30 Days

31 - 60 Days

61 - 90 Days

91 - 120

Days

121 - 150

Days Total

-

Bulk Electricity 56,651,098 21,560,170 0 0 0 78,211,268

Bulk Water 14,844,623 0 0 0 0 14,844,623

PAYE deductions 4,938,851 0 0 0 0 4,938,851

VAT (output less input) 4,434,867 0 0 0 0 4,434,867

Pensions / Retirement deductions 6,232,127 0 0 0 0 6,232,127

Loan repayments 3,290,137 0 0 0 0 3,290,137

Trade Creditors 62,806,932 183,288 2,834 119,075 0 63,112,129

Auditor General 0 0 0 0 0 0

Other 1,093,500 500 0 0 0 1,094,000

Total 154,292,135 21,743,958 2,834 119,075 0 176,158,002

Eskom 57,355,348 21,560,170 0 0 78,915,518

Rand Water 14,076,581 0 0 0 0 14,076,581

South African Revenue Service 9,373,718 0 0 0 0 9,373,718

Vision Active 6,996,930 0 0 0 0 0

Pro-Plan Consulting Engineers 5,423,468 0 0 0 0 5,423,468

Twin-M Plant Hire 3,861,492 0 0 0 0 3,861,492

Actom Switchgear 2,923,587 0 0 0 0 2,923,587

Inkolelo Trading 371 CC 2,613,563 0 0 0 0 2,613,563

Tecroveer & Ron 2,576,296 24,326 0 0 0 2,600,622

Scifin Pty Ltd 2,264,717 0 0 0 0 2,264,717

Other Trade Creditors 46,826,435 159,462 2,834 119,075 0 47,107,806

Total 154,292,135 21,743,958 2,834 119,075 0 176,158,002

Note: This table depicts the monthly aging of the creditors for the month of June 2013

9

2.1.8 PERFORMANCE ON REVENUE COLLECTION Table 2: Billed income – amount billed to date and cash received. Figures in R 000

Periods Amount billed for year to date

Cash received as at 30th June 2013

Collection rate as at 30th June

2013

July 2012 104 733 89 352 85%

August 2012 113 339 105 710 93%

September 2012 120 702 99 501 82%

October 2012 112 222 109 373 97%

November 2012 98 677 108 772 110%

December 2012 108 669 101 927 94%

January 2013 98 684 94 877 96%

February 2013 100 718 85 053 84%

March 2013 97 092 90 381 93%

April 2013 95 449 99 941 105%

May 2013 103 597 102 309 99%

June 2013 105 400 93 308 89%

Total 1 259 282 1 180 504 94%

Note: This table excludes service reconnections and sundry billing. Billing is only on Property Rates and four main tariffs.

The Cumulative Collection Rate as at the end of June 2013 stands at 94% - that is the amount of cash that has been received to date for the year is 94% of the billed amount. The collection rate for the month of June 2013 is 89%, more information and detail on this performance is given in section 7 of the report.

10

Chart 2 Monthly Collection Rate

Note: This chart depicts the actual revenue collected

The chart above shows that R93 308 million was collected for the month of June 2013.

Table 1.2 Monthly Debtors age analysis SC3 Monthly Budget Statement - aged debtors – M12 June

Description Budget Year 2012/13

0-30 Days 31-60 Days 61-90 Days 91-120 Days Total

R thousands

Debtors Age Analysis By Revenue Source

Rates 69,720,103 1,864,188 1,702,695 124,007,429 197,294,415

Electricity 93,823,880 1,990,327 1,037,989 132,958,813 229,811,008

Water 37,587,927 2,942,453 2,381,858 140,213,030 183,125,268

Sewerage / Sanitation 26,117,594 2,084,357 1,546,018 16,119,632 45,867,601

Refuse Removal 33,574,192 2,232,926 1,862,119 22,070,077 59,739,314

Housing (Rental Revenue) 469,861 60,472 48,613 908,308 1,487,255

Other 47,722,744 3,799,077 2,817,576 151,309,532 205,648,928

Total By Revenue Source 309,016,301 14,973,799 11,396,868 587,586,820 922,973,788

Debtors Age Analysis By Customer Category

Government 7,070,469 2,856,388 869,690 9,512,902 20,309,449

Business 89,592,941 1,510,668 1,095,817 90,557,149 182,756,575

Households 204,886,825 9,996,409 8,903,390 238,897,196 462,683,820

Other 7,466,066 610,334 527,971 248,619,574 257,223,945

Total By Customer Category 309,016,301 14,973,799 11,396,868 587,586,820 922,973,788

Note: This table depicts the monthly aging of the debtors for the month of June 2013.

11

Table 3: Capital Budget performance for the year to 30th June 2013

2012/2013

Approved Adjusted Budget

R 000

Actual spend to date (in R and as a % of the

Approved Adjustment

Budget)

R 000 %

Pro rata

Budget to date

R 000

Under over

spend against pro rata budget R 000

% of pro rata budget spent

%

EXPENDITURE 358 512 309 611 86% 358 512 48 901 86%

2.1 To date, there has been spending amounting to R309 611 million from the capital

budget (this represents 86% of the total approved adjusted expenditure budget for year). Section 3 of this report gives more detail on this performance.

Chart 3 2012/13 Capital Expenditure Monthly Trends: actual v target

12

Chart 4 2012/13 Capital Expenditure: YTD actual v YTD target

13

2.3 CASH FLOW REPORT OF MOGALE CITY FOR JUNE 2013: Table 4: Cash Flow Position as at 30th June 2013. Figures in Rm's

Cash balance brought forward from 2011/12 22,073

Cash received for the year to date 2,061,830

Cash payments made for the year to date (2,016,354)

Current cash position 67,549

2.3.1 Mogale City's cash in hand as at the end of June 2013 was R 67,549m amount

was made up as follows:

Source RM Investec - ( Sars) 29,779

Grants Account 36

Social Responsibility funds-account 1,570

Social Responsibility funds-90 days 4,000

Sanlam Shares 449

Bank Balance 31,715

Total cash in hand 67,549

14

2.3.2 The Operating Income for the month of June 2013 was R13 869m less than the operating income for the month of May 2013 and the operating expenditure was R24,488m more than that of the previous month. The operating income excludes income derived from operational grants and this depicts that Mogale City is dependent on grants than own generated revenue. Month Operating

Income Operating Expenditure

Difference

RM RM RM

Jul-12

115,833

183,428

-67,595

Aug-12

152,264

140,768

11,496

Sep-12

114,993

131,225

-16,232

Oct-12

145,051

135,850

9,201

Nov-12

140,518

147,854

-7,336

Dec-12

122,111

187,334

-65,223

Jan-13 153,513 148,443 5,070

Feb-13 109,597

77,924

31,673

Mar-13 116,196 202,839 -86,642

April -13

121,415

88,873

32,542

May-13

133,903

128,136

5,768

June-13 120,034 152,624 -32,590

Total 1,545,428

1,728,298

-179,869

15

2.3.3 The month of June 2013 shows the collections rates of 94% and the operating income was R32,590m less than the operating expenditure. The year to date shortage is R179,869m . Chart: Performance of Operating Income vs Operating Expenditure

16

BANK BALANCE, INVESTMENTS, AND BORROWING Table 5: Key Treasury Information as at 30

th June 2013

Previous Month Current Position Change from previous month

Balance in current account -R 1,074,495 R31,715,179 Increase R 30,640,684

Total investments held : Uncommitted Call (Sanlam Shares) R 462,624 R 448,960 Decrease -R 13,664

Committed MIG grant Call

R 5,943,012 R 0 Decrease -R 5,943,012

Committed Loan Funds Call R 18,363,481 R 29,778,601 Increase R11,415,119

Committed Mig Grants Call R 41,919,995 R 0 Decrease -R 41,919,995

Commited Sars & Loan Funds R 50,000,000 R 0 Decrease -R 50,000,000

Committed Social responsibility-90 days Fixed Deposit R 4,000,000 R 4,000,000 No Movement R 0

Committed : Fixed Deposits R 68,293,514 R 69,076,453 Increase R 782,939

Total external borrowing R 324,096,384 R 366,642,398 increase R42,546,214

More information on these treasury matters is given in section 5 of this report.

17

3 . FINANCIAL PERFORMANCE (EXPENDITURE BY MUNICIPAL VOTE)

Consolidated Monthly Budget Statement - Financial Performance expenditure by municipal vote) - M12 June

Vote Description 2011/12 Budget Year 2012/13

R thousand Audited

Outcome Original Budget

Adjusted Budget

Monthly actual

YearTD actual

YearTD budget

overs/unders against ytd

budget

YTD actual as a %

pro rata budget

%

Expenditure by Vote –

Vote 1 - POLITICAL OFFICE

27,647

52,860

56,907

6,044

46,709

56,907 10,198 82%

MAYOR'S OFFICE

13,457

28,212

31,969

3,299

26,680

31,969 5,290 83%

SPEAKER'S OFFICE

14,190

24,648

24,937

2,745

20,029

24,937 4,908 80%

Vote 2 - MUNICIPAL MANAGERS OFFICE

48,081

53,897

73,267

6,132

56,927

73,267 16,340 78%

ADMINISTRATION(MUNICIPAL MANAGER)

1,784

4,969

6,987

327

4,105

6,987 2,882 59%

CHIEF OPERATING OFFICER

2,136

3,677

3,206

401

3,211

3,206 (5) 100%

INTERNAL AUDIT

4,071

5,523

5,257

377

4,955

5,257 302 94%

PROJECT MANAGEMENT UNIT

2,185

4,692

1,918

117

1,641

1,918 277 86%

IDP & IGR

2,417

2,690

7,579

300

7,579

7,579 (0) 100%

MONITORING & EVALUATION

805

983

1,107 4

425

1,107 682 38%

INFORMATION MANAGEMENT

34,681

31,363

47,213

4,606

35,011

47,213 12,203 74%

Vote 3 - CORPORATE SUPPORT SERVICES

64,345

93,915

90,263

8,106

75,209

90,263 15,054 83%

ADMINISTRATION(EXECUTIVE MANAGER)

7,042

6,036

4,996

358

4,050

4,996 945 81%

LEGAL SERVICES

15,269

19,900

20,173

2,042

19,483

20,173 690 97% INTERGOVERMENTAL & CORPORATE

ADMIN

16,293

28,650

26,674

2,406

23,732

26,674 2,941 89%

HUMAN CAPITAL MANAGEMENT

16,694

23,216

27,708

2,391

20,245

27,708 7,463 73%

MARKETING & COMMUNICATION

9,047

16,112

10,713

907

7,699

10,713 3,015 72%

Vote 4 - MUNICIPAL FINANCIAL SERVICES

196,578

193,388

225,611

14,620

173,339

225,611 52,272 77%

ADMINISTRATION(CFO)

6,838

6,981

5,238

196

4,099

5,238 1,140 78%

VALUATIONS

3,355

10,345

8,708

1,986

6,574

8,708 2,135 75%

REVENUE

82,041

52,200

56,841

3,822

55,903

56,841 938 98%

CREDIT CONTROL

34,484

38,422

40,689

2,793

36,470

40,689 4,220 90%

CREDITORS

14,225

15,080

52,682

2,779

17,220

52,682 35,463 33%

SUPPLY CHAIN MANAGEMENT

39,011

13,916

15,219

1,473

14,461

15,219 758 95%

BUDGET & TREASURY

16,624

56,443

46,233

1,571

38,614

46,233 7,619 84%

18

Consolidated Monthly Budget Statement - Financial Performance expenditure by municipal vote - M12 June (continues)

Vote Description 2011/12 Budget Year 2012/13

R thousand Audited

Outcome Original Budget

Adjusted Budget

Monthly actual

YearTD actual

YearTD budget

overs/unders against ytd

budget

YTD actual as a %

pro rata

budget

%

Expenditure by Vote

Vote 5 - INTEGRATED ENVIRONMENTAL MANAGEMENT

180,388

160,353

174,094

12,484

158,839

174,094 15,255 91%

ADMINISTRATION(EXECUTIVE MANAGER) 2,248 2,399 2,007

138 2,131

2,007 (124) 106%

ENVIRONMENTAL MANAGEMENT 12,816 14,348 14,626

734 6,342

14,626 8,284 43%

MUNICIPAL HEALTH

122,898 89,707

104,003

7,718

104,829

104,003 (826) 101%

PARKS MANAGEMENT 42,426 53,900 53,458

3,895

45,536

53,458 7,922 85%

Vote 6 - SOCIAL SERVICES

184,845

193,195

198,761

19,485

195,194

198,761 3,567 98%

ADMINISTRATION(EXECUTIVE MANAGER) 28,887 4,183 3,985

2,049

24,382

3,985 (20,398) 612%

SOCIAL UPLIFTMENT 13,574 19,514 21,043

1,113

12,975

21,043 8,068 62%

SPORTS,RECREATION,LIBRARIES,HERITAG E & MUSEUM 37,515 49,841 54,054

3,438

38,217

54,054 15,837 71%

LICENCES 12,069 13,716 13,905

1,031

12,608

13,905 1,297 91%

PUBLIC SAFETY 92,559

105,668

105,545

11,847

106,831

105,545 (1,286) 101%

CLINICS 242 273 228 8 180

228 48 79%

Vote 7 - ECONOMIC SERVICES 36,630 44,881 39,470

3,350

31,233

39,470 8,236 79%

DEVELOPMENT & PLANNING 15,646 17,665 16,661

1,193

14,219

16,661 2,442 85%

ENTERPRISE DEVELOPMENT & TOURISM 3,883 4,124 4,647

608 5,525

4,647 (878) 119%

RURAL DEVELOPMENT 8,302 11,366 7,262

647 4,439

7,262 2,822 61%

HUMAN SETLLEMENTS 8,799 11,726 10,901

902 7,050

10,901 3,850 65%

Vote 8 - INFRASTRUCTURE SERVICES

998,518

1,094,801

1,154,151

120,660

1,071,892

1,154,151 82,259 93%

ADMINISTRATION(EXECUTIVE MANAGER) 2,266 2,477 2,620

174 2,276

2,620 345 87%

WATER & SANITATION

297,429

331,395

362,682

33,351

306,250

362,682 56,433 84%

FLEET MANAGEMENT 2,005 7,451 6,779

454 5,935

6,779 844 88%

ELECTRICITY DISTRIBUTION

530,517

585,748

596,277

68,017

581,333

596,277 14,944 97%

MUNICIPAL BUILDINGS 36,171 36,034 37,267

4,836

32,744

37,267 4,523 88%

ROADS & STORMWATER

130,129

131,697

148,526

13,827

143,355

148,526 5,170 97%

Total Expenditure by Vote

1,737,031

1,887,291

2,012,524

190,881

1,809,342

2,012,524 203,182 90%

3.3.1. This table shows expenditure of June 2013 from the operational budget these include non-cash items. The spend-to-date represents 90% of the total Approved Adjustment Budget or 90% of the pro rata budget. The following variances are worth noting.

19

o The following departments have over expenditure as compared to their pro rata

budget, however it should be noted that when compared with their annual budgets they are still within the budgeted amounts.

Intergrated Environmental Management – here the biggest contributors are

mainly non cash item that is depreciation, interest, internal charges and indigent subsidies.

Social Services – the over expenditure in this department is as a result of a the backdating of depreciation and employee related cost under Public Safety.

Economic services – the biggest contributor are employee related costs under enterprise development.

20

Table C4 Monthly Budget Statement - Financial Performance expenditure - M12 June

Description

2011/12 Budget Year 2012/13

Audited Outcome

Original Budget

Adjusted Budget

Monthly actual

YearTD actual

YearTD budget

overs/unders against ytd

budget

YTD actual as a %

pro rata

budget

R thousands %

Expenditure By Type

Employee related costs 397,068 461,056 466,425 38,660 445,165 466,425 21,259 95%

Remuneration of councillors 17,954 21,930 21,930 1,620 19,019 21,930 2,910 87%

Debt impairment 86,052 50,578 70,063 5,839 70,063 70,063 (0) 100%

Depreciation & asset impairment 236,930 195,492 239,634 17,482 212,337 239,634 27,296 89%

Finance charges 45,285 44,417 51,632 2,575 34,647 51,632 16,985 67%

Bulk purchases 540,935 620,860 633,459 65,250 607,147 633,459 26,312 96%

Contracted services 147,169 225,119 231,798 24,189 158,705 231,798 73,093 68%

Transfers and grants 19,893 20,859 31,083 3,458 31,757 31,083 (674) 102%

Other expenditure 245,744 246,981 266,501 31,809 230,501 266,501 35,999 86%

Total Expenditure 1,737,031

1,887,291 2,012,524 190,881 1,809,342

2,012,524 203,182 90%

3.3.2.1 Annexure A, Table C4 sets out the monthly expenditure to date on the operating budget analysed by type.

In overall terms expenditure on employees’ costs and remuneration to council is 95% of the total Approved Budget for the year or 95% of pro rata budget.

3.3.3.2 The discussion set out below looks at the major (under) and over

expenditure on individual budgets.

o Interest on External borrowings - Expenditure on this item is 67% of the total Approved Budget for the year. The interest payments are contractually fixed but vary on a monthly basis due to different banks being involved and different payment dates agreed to.

o Insurance Costs - R1 778 million has been spent to date (98%) of the

Approved Budget for the year).

o Depreciation – this cost item is now being allocated on a month to month basis in accordance with the Fixed Assets Management Policy as approved, this policy determines, amongst other things the expected useful life of different classes of assets, the asset unit calculates this amounts monthly based on the policy.

3.3.2.3 EXPENDITURE ON STAFF BENEFITS

21

Supporting Table SC8 Monthly Budget Statement - councillor and staff benefits - M12 June

Summary of Employee and Councillor remuneration

2011/12 Budget Year 2012/13

Audited Outcome

Original Budget

Adjusted Budget

Monthly actual

YearTD actual

YearTD budget

overs/unders against ytd

budget

YTD actual as a %

pro rata

budget

Councillors (Political Office Bearers plus Other)

Basic Salaries and Wages 10,658

14,114 14,114

986

11,462

14,114 2,652 81%

Pension and UIF Contributions 1,624

1,670 1,670

141

1,678

1,670 (8) 100%

Medical Aid Contributions 564

604 604

48

569

604 36 94%

Motor Vehicle Allowance 4,213

4,596 4,596

367

4,374

4,596 223 95%

Cellphone Allowance 895

945 945

79

936

945 8 99%

Sub Total - Councillors 17,954

21,930 21,930

1,620

19,019

21,930 2,910 87%

Senior Managers of the Municipality

Basic Salaries and Wages 7,813

9,660 9,007

743

8,908

9,007 100 99%

Pension and UIF Contributions 818

557 567

47

565

567 1 100%

Medical Aid Contributions

113 63 9

111

63 (48) 177%

Performance Bonus 924

1,400 2,606 –

764

2,606 1,841 29%

Motor Vehicle Allowance 1,176

1,613 1,433

119

1,433

1,433 – 100%

Sub Total - Senior Managers of Municipality 10,731

13,343 13,675

919

11,781

13,675 1,894 86%

Other Municipal Staff

Basic Salaries and Wages 246,599

286,083 295,589

23,625

274,088

295,589 21,501 93%

Pension and UIF Contributions 48,687

57,876 57,753

4,484

53,535

57,753 4,219 93%

Medical Aid Contributions 15,779

18,457 17,228

1,535

17,458

17,228 (230) 101%

Overtime 16,706

13,100 19,541

1,938

19,087

19,541 454 98%

Performance Bonus 19,458

26,211 27,377

1,428

21,884

27,377 5,493 80%

Motor Vehicle Allowance 30,059

35,211 34,353

2,822

32,150

34,353 2,204 94%

Housing Allowances 3,311

3,554 3,438

293

3,529

3,438 (91) 103%

Payments in lieu of leave 7,862

1,300 1,544 –

1,695

1,544 (151) 110%

Payments in lieu of long service – – 2,137

301

3,065

2,137 (928) 143%

Payments in lieu of resignations & retirements – – 789

341

1,211

789 (422) 153%

Long service awards 149

144 112 –

112

112 – 100%

Post-retirement benefit obligations

(2,273)

5,776 5,776

974

5,572

5,776 205 96%

Sub Total - Other Municipal Staff 386,337

447,713 465,637

37,741

433,384

465,637 32,253 93%

TOTAL SALARY, ALLOWANCES & BENEFITS 415,022

482,985 501,242

40,280

464,184

501,242 (37,057) -7%

TOTAL MANAGERS AND STAFF 397,068

461,056 479,312

38,660

445,165

479,312 34,147 7%

22

3.3.2.4 Section 66 of the MFMA (Municipal Finance Management Act, 2003) requires that expenditures incurred by the municipality on staff salaries; wages, allowances and benefits are regularly reported to Council. This information is given in Annexure A, Table SC8 above for this report, along with the equivalent information on Councillor Allowances.

3.3.2.5 Total expenditure on staff and councillor benefits is 95% of the total Approved

Budget or 95% pro rata budget.

o Leave payments (Normal, long service, retirements & resignations) has overspent on pro rata budget. The main reason for that is that despite a resolution of Executive Committee not to make leave payments, we are obliged by law to make payments in respect of resignations and retirements.

Table C4 Monthly Budget Statement - Financial Performance revenue - M12 June

Description

2011/12 Budget Year 2012/13

Audited Outcome

Original Budget

Adjusted Budget

Monthly actual

YearTD actual

YearTD budget

overs/unders againt ytd budget

YTD actual as a %

pro rata

budget

R thousands %

Revenue By Source

Property rates

247,753

286,767

265,995

22,197 262,768

265,995 3,227 99%

Service charges - electricity revenue

619,676

765,628

741,308

61,029 702,284

741,308 39,024 95%

Service charges - water revenue

169,383

190,728

189,237

16,351 187,072

189,237 2,165 99%

Service charges - sanitation revenue

85,747

103,112

99,494

7,448 92,641

99,494 6,853 93%

Service charges - refuse revenue

76,556

80,947

87,271

7,686 88,695

87,271 (1,424) 102%

Service charges - other

11,725

15,715

17,101

3,700 20,866

17,101 (3,765) 122%

Rental of facilities and equipment

3,149

3,819

2,990

186 2,818 2,990 173 94%

Interest earned - external investments

4,730 619

974 – 10,757 974 (9,783) 1104%

Interest earned - outstanding debtors

10,204

16,758

8,550

1,123 10,325 8,550 (1,775) 121%

Fines

11,036

16,923

6,777

3,006 9,477 6,777 (2,700) 140%

Licences and permits 23 26 16 1 17 16 (1) 104%

Agency services

19,075

17,266

19,075

9,319 22,780

19,075 (3,704) 119%

Transfers recognised - operational

201,608

227,133

228,316

1,159 226,078

228,316 2,238 99%

Other revenue

210,870

30,299

33,002

2,362 56,847

33,002 (23,844) 172%

Gains on disposal of PPE –

6,900

150

(18) (285) 150 435 -190%

Total Revenue (excluding capital transfers and contributions)

1,671,534

1,762,640

1,700,260

135,548 1,693,140

1,700,260 7,120 100%

3.4.1 Revenue as at end of June (largely billed income rather than cash (received) was R1 693 140 million. This represents 100% of the total Approved Budget for the year or 100% of the pro rata budget.

23

3.4.2 Interest earned on external investment. Normally this represent a small amount of

interest income which is generated from the short term investments held when there are temporary surpluses of cash.

3.4.3 Interest earned on outstanding debtors. This is interest levied for main tariffs

on outstanding debt. 3.4.4 Vehicle Registration.

Vehicle registration is an in and out vote. As the money is being collected, a subsequent payment is made to the Gauteng Provincial Government.

3.5 OVERALL PERFORMANCE ON THE OPERATING BUDGET

Table 8: Operating Budget Performance for the year to 30th June 2013

2012/2013 FULL

YEAR

R 000

PRO RATA

BUDGET FOR THE YEAR TO

DATE

R 000

Expenditure Budget (2 012 524) (2 012 524)

Actual to date (1 809 342) (1 809 342)

Variance - under / over spending (203 182) (203 182)

% of Budget Spent 90% 90%

Revenue Budget 1 700 259 1 700 259

Actual income to date 1 693 140 1 693 140

Variance – under (over) revenue (7 120) (7 120)

% of Budget received 100% 100%

Surplus/(Deficit) Budgeted Position (312 264) 196 063

Surplus/(Deficit) position to date (109 082) (109 082)

Note: Negative (Expenditure) & Positive Revenue Exclude capital grants revenue

To summarise, expenditure to date is 90% of the total Approved Budget for the year or 90% of the pro rata budget.

Income to date represents 100% of the total Approved Budget for the year or

100% of the pro rata budget.

24

4 CAPITAL BUDGET PERFORMANCE 4.1 CAPITAL EXPENDITURE BY VOTE Table 9: Capital expenditure for the year to 30th June 2013 – by vote

Departments/Votes

2012/2013 Approved

Adjustment Budget

R 000

Actual expenditure to date

R 000 %

Pro rata Budget to

date

R 000

Under/ Over spend

against pro rata budget

R 000

% of pro rata budget

Spent to date

POLITICAL OFFICE 175

0

0.00%

175

175

0.00%

- Office of the Executive Mayor

175

0

0.00%

175

175

0.00%

MUNICIPAL MANAGER‘S OFFICE

6,325

1,148

18%

6,325

5,177

18%

- Administration :MM 25

19

77%

25

6

77%

-Internal Audit 70

59

85%

70

11

85%

Project Management Office

10 2 19% 10 8 19%

Information Technology 6,220

1,068

17%

6,220

5,152

17%

CORPORATE SUPPORT SERVICES:

1,600

670

42%

1,600

930

42%

- Corporate Services 1,280 589 46% 1,280 691 46%

- Legal Services 100 0 0 100 100 0%

- Human Capital Support 100 68 68% 100 32 68%

- Marketing & Communication

120 13 11% 120 107 11%

FINANCIAL SERVICES:

1,532

508

33%

1,532

1,024

33%

SOCIAL SERVICES: 43,114 31,168 72% 43,114 11,946 72%

- Community Services 37 187 25,924 70% 37,187 11,263 70%

- Public Safety 5,927 5,244 88% 5,927 683 88%

ECONOMIC SERVICES: 29,693 25,157 85% 29,693 4,536 85%

- Enterprise Development 648 569 88% 648 79 88%

- Development & planning 349 41 12% 349 307 12%

- Rural Development 28,647 24,547 86% 28,647 4,100 86%

- Sustainable Human Settlement

50 0 0% 50 50 0%

INTEGRATED ENVIRONMENTAL SERVICES:

31,142

18,781

60%

31,142

12,362

60%

- Administration 190 2 1% 190 188 1%

- Parks and Cemeteries 22,806 18,036 79% 22,806 4,770 79%

- Municipal Health 8,146 743 9% 8,146 7,404 9%

INFRASTRUCTURE SERVICES: 244,930 232,178 95% 244,930 12,751 95%

- Building Facilities 9,300 6,340 68% 9,300 2,960 68%

- Water and Sanitation 88,435 81,487 92% 88,435 6,947 92%

- Electricity 95,619 95,445 100% 95,619 174 100%

- Roads & Storm water 51,576 48,906 95% 51,576 2,670 95%

TOTAL CAPITAL BUDGET

358,511

309,611

86%

358,511

48,900

86%

4.1.1 Table 9 above shows expenditure as at end of June 2013 on the capital budget per vote. In overall terms 86% of the capital budget has been spent.

25

4.2 CAPITAL EXPENDITURE BY PROJECT 4.2.1 Annexure B, Table 1 gives details of expenditure incurred to date on each capital

project. 4.3 FUNDING OF THE CAPITAL BUDGET Table 10: Funding of capital expenditure for the year to 30th June 2013

Source of Funding

2012/2013

Approved Adjustment Budget

R 000

Financing of capital

expenditure incurred to date

R 000

National Government Grants

- Municipal Infrastructure Grant 96 435 88 375

- DWAF 1 531 1 531

- Department of Energy 8 000 7 817

Total National Government Grants 105 966 97 723

Provincial Government Grants

- Social Development 16 669 16 669

- GDACE 362 97

- SRAC 1 891 1 824

Total Grants from Province 18 922 18 590

District Municipality grants

- WRDM 3 085 900

Total Grants from District 3 085 900

Council’s Own Funds

- Own Funds 54 097 24 593

- External Loans - 176 441 167 805

Total Own Funds 230 539 192 398

TOTAL FUNDING 358 512 309 611

26

Table 10 on page 25 is source of funding: The total expenditure on Capital for the month ending June 2013 is R 309 611m, representing 86% as compared to the total budget, 86% of the pro rata budget. National Grants: Spending on this class of funding sits at 92%, the breakdown thereof is as follows: Municipal Infrastructure Grant: 92%, Department of Water Affairs: 100% Department of Energy: 98% This grants are conditional and not spend fully will affect our share of equitable share for the first quarter of the 2013/14 financial year as MCLM will be required to pay back unspent funds to National Treasury. There is a significant improvement on the level of spending on this source of funding, as there are still invoices coming through, the 8% still unspend may be entirely spent. Provincial and District Grants: Provincial grants shows a 98% expenditure of the total budget, the social development grant is 100% spend whereas the SRAC grant is 96% spent. The only lagging grant showing low expenditure is GDACE, however this is price money grant and is not conditional. District grant is still showing a 29% expenditure, this is expenditure on the Lenwan Hostel upgrade. The portion of the grant ,is meant for the Kromdraai pipeline, this project was indeed transferred from the WRDM to MCLM for completion, at the time of transfer, the contractors were already appointed,the project is currently on hold due to concerns raised by the Cradle of Human Kind Management Authority regarding compliance, this is in relation to the Record of Decision as issued by GDARD, and MCLM could not proceed with the project without satisfying all concerned affected parties. And upon engaging all concerned parties it emerged that concerns relates to the issue of who between the GDARD and DEA has the authority to issue the ROD. These concerns meant that MCLM could not proceed with the project, however the WRDM has undertaken to assist in resolving the matter, and once this has been settled, MCLM can finish the project in a space of two months. Own Funded: Spending to date on own funded projects (own revenue combined with borrowed own funding) are 83% or R 192 398 million, Nedbank loan indicates 95% spending, a marked improvement as compared to 66% recorded in May, while own revenue is still lagging behind with 45% recorded to date.

27

At a recent meeting a survey was undertaken to determine why departments are not spending their allocated funds on capital, most of them indicated that they are either at the tender allocation process and for small projects are at the supply chain for quotations to be evaluated. The expenditure on capital for the month ending June indicates that departments roll out their projects right at the end of the financial year, this practice will have to discouraged and as it puts a strain on the own funded cash flow. What we have noticed is that majority of the departments start with the supply chain process very late or 3 months before year end which is a clear indication of lack of planning and foresight. We believe that in the following years to come this lessons will assist us in coming up with a planning module that will enable us to plan better. Infrastructure, which has 68% of the total budget allocated to, currently shows 95% of expenditure on all their projects. Current Status on Capital Budget Spending At the time of going to the print with this report total expenditure on capital was standing at R 314 928 or 88%, a 2% increase on the reported 86%. MIG was R 93,143, translating into 97% of the budget. External Loan funding was standing at R 168,339 or 96% of the budget. All other grants were still standing as reported above – it should be noted that this expenditure amounts will probably change as will be seen in the final Annual Financial Statements as invoices are still coming in.

28

4.4 GRANTS – ALLOCATIONS RECEIVED AND EXPENDITURE INCURRED 4.4.1 Section 71 of the MFMA requires that the amount of grant allocations received by

the municipality, and the amount of expenditure funded by these allocations, be reported monthly (including equitable share). Annexure A, Table SC6 (receipts) and SC7 (expenditure) gives this information.

4.4.2 Table SC6 show that MCLM expects to obtain R340 928million of grants from

other spheres of government for 2012/2013 to date an amount of R340 928 have been received. This amount is for funding both the operational and capital budget.

Supporting Table SC6 Monthly Budget Statement - transfers and grant receipts - M12 June

Description

2011/12 Budget Year 2012/13

Audited Outcome

Original Budget

Adjusted Budget

Monthly actual

YearTD actual

YearTD budget

overs/unders against ytd

budget

YTD actual as a %

pro rata

budget

R thousands %

RECEIPTS:

Operating Transfers and Grants

National Government:

191,493

219,068

216,223 –

216,223

216,223 – 100.0%

Local Government Equitable Share

186,224

210,117

210,117

210,117

210,117 – 100.0%

Finance Management

1,250

1,250

1,250 –

1,250

1,250 – 100.0%

Municipal Systems Improvement 800

1,000

1,000 –

1,000

1,000 – 100.0%

EPWP Incentive

1,155

1,891

2,085 –

2,085

2,085 – 100.0%

MIG (PMU)

2,064

4,810

1,771 –

1,771

1,771 – 100.0%

Provincial Government:

4,770

4,770

4,322 –

4,322

4,322 – 100.0%

Sport and Recreation

4,770

4,770

4,322

4,322

4,322 – 100.0%

Housing – – – 0.0%

Total Operating Transfers and Grants

196,263

223,838

220,545 –

220,545

220,545 – 100.0%

Capital Transfers and Grants

National Government: –

102,096

104,435 –

104,435

104,435 – 100.0%

Municipal Infrastructure Grant (MIG)

93,396

96,435

96,435

96,435 – 100.0%

National Electrification Programme

8,000

8,000

8,000

8,000 – 100.0%

Provincial Government: –

15,500

15,948 –

15,948

15,948 – 100.0%

Sports & Recreation 448 448 448 – 100.0%

Social Development

15,500

15,500

15,500

15,500 – 100.0%

Total Capital Transfers and Grants –

117,596

120,383 –

120,383

120,383 – 100.0%

TOTAL RECEIPTS OF TRANSFERS & GRANTS

196,263

341,434

340,928 –

340,928

340,928 – 100.0%

29

Supporting Table SC7 Monthly Budget Statement - transfers and grant expenditure - M12 June

Description

2011/12 Budget Year 2012/13

Audited Outcome

Original Budget

Adjusted Budget

Monthly actual

YearTD actual

YearTD budget

overs/unders against ytd

budget

YTD actual as a %

pro rata

budget

R thousands %

EXPENDITURE

Operating expenditure of Transfers and Grants

National Government:

190,724

219,068

216,223

13,879

216,137

216,223 86 100.0%

Local Government Equitable Share

186,224

210,117

210,117

13,138

210,117

210,117 – 100.0%

Finance Management

1,250

1,250 1,250

206

1,250

1,250 (0) 100.0%

Municipal Systems Improvement

800

1,000 1,000

1,000

1,000 – 100.0%

EPWP Incentive

386

1,891 2,085

419

2,132

2,085 (47) 102.3%

MIG (PMU)

2,064

4,810 1,771

117

1,638

1,771 133 92.5%

Provincial Government:

1,495

4,770 4,322

323

3,714

4,322 608 85.9%

Sport and Recreation

1,495

4,770 4,322

323

3,714

4,322 608 85.9%

Housing – – 0.0%

Total operating expenditure of Transfers and Grants:

192,220

223,838

220,545

14,203

219,851

220,545 694 99.7%

Capital expenditure of Transfers and Grants –

National Government:

73,001

102,096

104,435

25,627

96,190

104,435 8,246 92.1%

Municipal Infrastructure Grant (MIG)

73,001

93,396 96,435

18,830

88,373

96,435 8,062 91.6%

Neighbourhood Development Partnership

700 – –

National Electrification Programme

8,000 8,000

6,797

7,817

8,000 183 97.7%

Provincial Government:

20,813

15,500 15,948

1,682

17,324

15,948 (1,376) 108.6%

Sports & Recreation

3,653 448

1,682

1,824

448 (1,376) 407.4%

Social Development

17,160

15,500 15,500

15,500

15,500 – 100.0%

Total capital expenditure of Transfers and Grants

93,814

117,596

120,383

27,309

113,514

120,383 6,869 94.3%

TOTAL EXPENDITURE OF TRANSFERS AND GRANTS

286,034

341,434

340,928

41,512

333,365

340,928 7,563 97.8%

4.4.3 A point worth noting is that excluded from the SC6(grants received) is a total rollover amount of R 5 160m as it was not gazetted for the 2012/13 budget year, and also excluded in SC7(grants expenditure) is an amount of R 1 869m relating to rollover expenditure. To date R333 365 has been spend which comes to 98% of total budget and 98% of pro rata budget.

30

5. CASH FLOW POSITION

5.1 The cash flow position for the 2012/13 year is given in the Table C7 cash Flow.

2011/12 Budget Year 2012/13

Audited

Outcome

Original

Budget

Adjusted

Budget

Monthly

actual

YearTD

actual

YearTD

budget

YTD

variance

YTD

variance

Full Year

Forecast

R thousands 1 %

CASH FLOW FROM OPERATING ACTIVITIES

Receipts

Ratepay ers and other 1,389,307 1,734,186 1,686,478 120,034 1,545,671 1,686,478 (140,807) -8% 1,686,478

Gov ernment - operating 198,644 227,133 228,316 – 222,519 228,316 (5,798) -3% 228,316

Gov ernment - capital 103,357 119,871 127,976 – 121,706 127,976 (6,270) -5% 127,976

Interest 18,392 619 974 – 3,013 974 2,039 209% 974

Div idends 13 – – – – – – –

Payments

Suppliers and employ ees (1,254,199) (1,813,506) (1,794,429) (145,586) (1,690,378) (1,794,429) (104,051) 6% (1,794,429)

Finance charges (71,764) (44,417) (31,057) (1,648) (29,637) (31,057) (1,420) 5% (31,057)

Transfers and Grants (19,895) (20,859) (31,083) – (12,681) (31,083) (18,402) 59% (31,083)

NET CASH FROM/(USED) OPERATING ACTIVITIES 363,855 203,027 187,175 (27,200) 160,212 187,175 (26,962) -14% 187,175

CASH FLOWS FROM INVESTING ACTIVITIES

Receipts

Proceeds on disposal of PPE 28,121 6,900 150 – – 150 (150) -100% 150

Decrease (Increase) in non-current debtors – – – – – – – –

Decrease (increase) other non-current receiv ables – – – – – – – –

Decrease (increase) in non-current inv estments (9,064) – – – – – – –

Payments

Capital assets (368,826) (382,974) (358,512) (59,940) (285,185) (358,512) (73,326) 20% (358,512)

NET CASH FROM/(USED) INVESTING ACTIVITIES (349,769) (376,074) (358,362) (59,940) (285,185) (358,362) (73,176) 20% (358,362)

CASH FLOWS FROM FINANCING ACTIVITIES

Receipts

Short term loans – – – – – – – –

Borrow ing long term/refinancing – 190,994 190,994 41,590 190,994 190,994 – 190,994

Increase (decrease) in consumer deposits 958 – – – – – – –

Payments

Repay ment of borrow ing (10,605) (14,691) (19,304) (1,931) (20,546) (19,304) 1,242 -6% (19,304)

NET CASH FROM/(USED) FINANCING ACTIVITIES (9,647) 176,303 171,690 39,658 170,448 171,690 1,242 1% 171,690

NET INCREASE/ (DECREASE) IN CASH HELD 4,439 3,256 504 (47,482) 45,475 504 504

Cash/cash equiv alents at beginning: 39,336 22,073 22,073 22,073 22,073 22,073

Cash/cash equiv alents at month/y ear end: 43,775 25,329 22,577 67,549 22,577 22,577

Description Ref

GT481 Mogale City - Table C7 Monthly Budget Statement - Cash Flow - M12 June

31

GT481 Mogale City - Supporting Table SC9 Monthly Budget Statement - actuals and revised targets for cash receipts - M12 June

July August Sept October Nov Dec January Feb March April May June

R thousands 1 Outcome Outcome Outcome Outcome Outcome Outcome Budget Budget Budget Budget Budget Budget

Cash Receipts By Source

Property rates 23,880 28,783 22,696 23,994 27,902 27,767 23,065 21,555 24,943 27,700 28,368 21,197 252,696 302,826 333,108

Property rates - penalties & collection charges – – – – – – – – – – – – – – –

Serv ice charges - electricity rev enue 45,166 56,601 59,811 66,809 59,772 49,805 54,707 46,231 47,071 52,765 54,523 54,988 706,021 836,002 948,862

Serv ice charges - w ater rev enue 10,961 13,920 12,424 12,821 14,326 15,686 10,782 12,481 11,426 13,787 12,786 14,029 180,554 204,088 226,599

Serv ice charges - sanitation rev enue 7,177 6,965 5,928 6,489 6,639 6,719 6,330 6,174 6,077 7,307 6,837 6,126 94,519 108,886 119,775

Serv ice charges - refuse 4,211 4,583 4,311 4,434 4,859 4,754 4,528 4,131 4,258 4,645 5,025 4,669 68,179 77,114 84,826

Serv ice charges - other 1,164 2,218 1,252 1,025 1,472 896 1,474 1,511 1,312 1,626 1,880 1,825 32,605 26,001 28,601

Rental of facilities and equipment 35 476 265 260 274 – – 682 209 – 431 186 2,990 4,200 4,620

Interest earned - ex ternal inv estments – – 56 – – – – 6 2,404 274 274 – 974 631 644

Interest earned - outstanding debtors 436 700 697 731 – – 783 6 2,045 1,040 1,064 2,823 8,550 18,434 20,278

Div idends receiv ed – – – – – – – – – – – – – – –

Fines 341 254 351 199 658 69 – 766 2,473 312 1,032 3,023 6,777 16,923 16,923

Licences and permits 7,955 – – – – – – – 582 – – 65,004 65,016 65,019

Agency serv ices – 1,867 1,792 – – – – – 2,342 1,682 3,824 7,955 19,075 17,266 17,266

Transfer receipts - operating 88,956 6,157 1,134 990 70,386 – – 493 52,552 1,851 – – 228,316 239,369 256,805

Other rev enue 14,507 36,692 5,410 28,289 26,092 16,415 51,845 16,914 11,055 10,277 17,981 3,214 249,507 328,000 250,487

Cash Receipts by Source 204,789 159,217 116,127 146,040 212,381 122,111 153,513 110,952 168,749 123,266 134,024 120,034 1,915,768 2,244,757 2,373,814 –

Other Cash Flows by Source –

Transfer receipts - capital 49,051 – 15,500 3,000 – 29,235 – – 24,920 – – – 127,976 108,416 121,763

Contributions & Contributed assets – – – – – – – – – – – – – –

Proceeds on disposal of PPE – – – – – – – – – – – – 150 – –

Short term loans – – – – – – – – – – – – – – –

Borrow ing long term/refinancing – – – – – 83,865 – – 65,539 41,590 190,994 – –

Increase in consumer deposits – – – – – – – – – – – – –

Receipt of non-current debtors – – – – – – – – – – – – –

Receipt of non-current receiv ables – – – – – – – – – – – – –

Change in non-current inv estments – – – – – – – – – – – – – – –

Total Cash Receipts by Source 253,840 159,217 131,627 149,040 212,381 235,211 153,513 110,952 259,208 123,266 134,024 161,624 2,234,888 2,353,174 2,495,576 –

Cash Payments by Type –

Employ ee related costs 34,510 36,646 34,796 35,442 41,018 32,998 36,732 36,113 36,489 36,690 38,385 37,870 466,425 502,551 542,755

Remuneration of councillors 1,493 1,493 1,476 1,476 1,459 1,465 1,562 1,411 1,562 1,611 1,432 2,529 21,930 24,342 26,776

Interest paid 1,228 1,598 – 7,593 1,510 676 1,516 1,985 577 8,716 2,546 1,019 31,057 50,784 50,491

Bulk purchases - Electricity 85,512 41,228 38,131 33,883 36,866 65,510 41,669 2,632 55,165 11,662 16,927 33,326 470,623 541,282 627,888

Bulk purchases - Water & Sew er 750 10,764 13,315 15,586 12,022 26,568 12,500 984 24,639 1,034 12,529 29,668 162,837 175,059 198,692

Other materials 6,565 4,109 4,173 4,109 5,935 7,037 5,897 4,491 10,328 9,735 10,284 10,085 89,416 103,525 113,877

Contracted serv ices 25,210 14,936 12,164 16,900 21,845 23,837 20,143 9,974 26,459 12,410 20,495 19,945 229,503 196,877 200,847

Grants and subsidies paid - other municipalities – – – – – – – – – – – – – – –

Grants and subsidies paid - other 1,359 2,728 – – – 1,678 – – 1,351 2,850 2,714 – 31,083 20,953 23,152

General ex penses 8,546 12,282 4,692 11,767 6,092 15,963 8,845 4,347 11,966 1,592 8,228 11,043 135,173 162,731 176,514

Cash Payments by Type 165,174 125,784 108,748 126,757 126,746 175,732 128,864 61,937 168,537 86,299 113,540 145,485 1,638,044 1,778,103 1,960,992 –

Other Cash Flows/Payments by Type

Capital assets 20,357 6,467 6,760 15,706 4,125 12,849 12,364 23,682 54,920 12,271 55,745 59,940 358,512 403,060 234,620

Repay ment of borrow ing 1,246 2,109 – 989 2,197 683 1,531 3,653 1,355 1,760 3,092 912 19,304 17,593 18,385

Other Cash Flow s/Pay ments 20,259 17,378 23,411 16,655 24,095 12,213 21,094 18,836 16,164 10,073 17,167 2,769 218,525 165,487 237,733

Total Cash Payments by Type 207,036 151,738 138,918 160,106 157,163 201,477 163,852 108,109 240,976 110,403 189,544 209,105 2,234,385 2,364,244 2,451,731 –

NET INCREASE/(DECREASE) IN CASH HELD 46,804 7,479 (7,292) (11,066) 55,218 33,735 (10,339) 2,843 18,233 12,863 (55,521) (47,482) 504 (11,070) 43,845

Cash/cash equiv alents at the month/y ear beginning: 22,073 68,877 76,356 69,064 57,998 113,216 146,951 136,612 139,455 157,688 170,551 115,030 22,073 22,577 11,507

Cash/cash equiv alents at the month/y ear end: 68,877 76,356 69,064 57,998 113,216 146,951 136,612 139,455 157,688 170,551 115,030 67,549 22,577 11,507 55,352

Budget Year

+1 2013/14

Budget Year

+2 2014/15

Description

Budget Year

2012/13

RefBudget Year 2012/13

2012/13 Medium Term Revenue &

Expenditure Framework

32

5.2. A summary of the cash flow for the year is reflected in SC9. SC9 reflects the decrease in the cash and investments position more clearly. A decrease in cash of R47,482m is shown for the month of June 2013.

5.3 As at 30th June 2013 MCLM's bank balance amounted to R31,715,179.81 5.4 The total cash received during the month of June 2013 amounted to R2,441,841m

which is R115,930m more than the expected amount of R2,557,771m. Total Actual expenditure for the same period amounted to R2,460,441m which is R162,604more than the budgeted expenditure of R2,615,238m.

5.5 The total cash received includes cash received for Operating Activities such as the

sale of water, electricity, fees charged for refuse removal and sanitation as well as other service charges.

5.6 The total cash received from Operating Activities was R1,531,182m from the

expected Adjusted budget at 94% collection rate of R1,647,112m. Council therefore received R115,930m less operational income than expected.

5.7 The Total Income was made up of the following: Figures in Rm’s

Revenue Source Expected Income Actual Income Difference

RM RM RM

Property Rates R 252,696 R 301,850 R 49,154

Electricity R 670,467 R 604,875 R- 65,592

Water R 164,725 R 140,561 R -24,164

Sanitation R 94,519 R 78,809 R -15,710

Refuse R 68,179 R 54,409 R -13,770

PP Electricity R 35,554 R 43,375 R 7, 821

PP Water R 15,566 R 14,979 R -577

Other Income R 352,879 R 292,324 R -60,555

Sub-Total R 1,654,585 R 1,531,182 R 115,930

Investments Redeemed R 375,133 R 375,133 R 0

Operating Grants R 222,826 R 222,826 R 0

External Loan Received R 190,994 R 190,994 R 0

Capital Grants R 121,706 R 121,706 R 0

Total Income R 2,557,771 R 2,441,841 R 115,930

5.8 Other Service Charges, amounting to R17,655m consist of income for connection

and re-connection fees, building plan fees, cemetery fees and landfill site fees. 5.9 During the month of June 2013 the operating expenditure payments amounted to

R1,737,163 m, which is R119,153 less than the expected R1,856,316m .

33

5.10 Total Expenditure was made up of the following: Figures in Rm’s

Expenditure Item Expected Expenditure Actual Expenditure Difference

RM RM RM

Salaries R 488,355 R 461,126 R 27,229

Electricity R 470,623 R 462,510 R 8,113

Water R 159,821 R 157,149 R 2,672

Sewer R 3,016 R 3,210 R -194

Other Creditors R 734,501 R 653,168 R 81,333

Sub-Total R 1,856,316 R 1,737,163 R 119,153

Investments made R 380,853 R 380,853 R 0

Financing Activities R 46,557 R 46,557 R 0

Operating Grants R 10,683 R 10,683 R 0

Capital Expenditure R 328,636 R 285,185 R 43,451

Total Expenditure R 2,615,238 R 2,460,441 R 162,604

Annexure B, Table 2 displays the capital expenditure to date.

`

5.11 Council did not receive MIG funds during the month of June 2013.

34

6. CURRENT BANK BALANCE, INVESTMENTS, AND BORROWING 6.1 BALANCE IN CURRENT ACCOUNTS Table 11: Balance in current account as at 30th June 2013.

STANDARD BANK

TOTAL AVAILABLE

Balance

R31,715,180 R 31,715,180

6.2 INVESTMENTS 6.2.1. Schedule SC5 gives the Investment portfolio as at 30th June 2013. 6.2.2 MCLM has investments totaling R103,958m. Of this amount, R69,079m are

investments that are linked to the bullet loans previously taken out by the municipality. These investments must be used to repay the bullet loans at the end of the loan period or when a consolidation or restructuring of the loans is undertaken.

6.3 LOANS 6.3.1 MCLM has long term loans outstanding of R366,643m.A Increase amounting to

R42,546 million was due the final draw down amounting R41,590 million during the month.

6.4 QUARTELY WITHDRAWAL STATEMENT 6.4.1 Section 11(4) of the MFMA requires that a consolidated report is tabled to Council

at least quarterly on all withdrawals made from the municipality's bank accounts in terms of section 11(1) (b) to (j) of that Act. Annexure B Table 8 gives this information in the prescribed format.

35

6.4 SHORT TERM BORROWING 6.4.1 Section 45 (3) (iii) of the MFMA requires the accounting officer to notify the Council

in writing as soon as practical of the amount, duration and cost of any short term loan (overdraft facility) incurred by the municipality.

Mogale City utilised the overdraft facility during the month of June 2013.On average Mogale utilised an overdraft amounting to R16,537,007. Below is the schedule of days that Mogale utilised the overdraft.

Date Amount

3-Jun-13 -6,545,330

4-Jun-13 -8,407,713

5-Jun-13 -12,214,245

6-Jun-13 -8,831,024

7-Jun-13 -20,361,945

10-Jun-13 -17,714,974

11-Jun-13 -13,805,951

12-Jun-13 -10,462,710

13-Jun-13 -14,915,264

14-Jun-13 -16,448,597

18-Jun-13 -14,049,217

19-Jun-13 -14,715,678

20-Jun-13 -18,971,935

21-Jun-13 -23,206,922

24-Jun-13 -21,130,889

25-Jun-13 -33,244,535

26-Jun-13 -26,102,199

36

7. PERFORMANCE ON MAIN TARIFF REVENUE COLLECTION

7.1. Collection rates as at 30 June 2013 The following is a summary of the year to date collection rate as at June 2013 Table 12: Collection rates to 30 JUNE 2013

Main Tariff

Amount Billed

For the year to date

Amount received for the year to date

Collection Rate (received/billed) For the year to

date %

Property Rates 262 768 286 301 849 988 115% Electricity services 658 908 976 604 875 297 92% Water services 172 092 881 140 560 867 82% Sanitation services 92 641 451 78 809 016 85% Refuse services 72 871 087 54 408 731 75% SUB TOTAL 1 259 282 681 1 180 503 898 94% Other income 32 967 663 17 654 899 54% TOTAL 1 292 250 343 1 198 158 796 93%

7.1.1 The above table shows the amount billed and the amount of cash received for

each of the main tariffs. This is also shown graphically in Chart 1. 7.1.2 Other income related to debtors has been added to this monthly report. The totals

for the five main tariffs are thus stated separately as sub-totals.

37

Chart 1: Collection Rates to 30 June 2013 - by tariff

0

20

40

60

80

100

120

140

Property tax Electricity Water Sewage Refuse

%

%

Table 13: Collection Rate to 30 June 2013 by Suburb (accumulated year to date)

Suburb

Amount Billed For the year to

date

R

Amount received For the year to

date

R

Collection Rate (received/billed) For the year to

date %

Krugersdorp 950 724 879 934 016 459 98% Kagiso 80 640 103 44 612 840 55% Munsieville 12 916 004 7 661 344 59% Azaadville 38 363 780 35 519 433 93% Lusaka 17 021 355 7 165 140 42% Magaliesburg 30 804 127 23 503 239 76% A/H 19 751 637 18 258 190 92% Farms 124 050 150 113 806 226 92% Other 17 978 309 13 615 925 76% TOTAL 1 292 250 343 1 198 158 796 93%

7.1.3. The tables and charts below show monthly Collection Rates analysed by suburb and by customer category.

38

Chart 2: Collection Rates for the year to 30 June 2013 – by Suburb

Table 14: Collection Rate to 30th June 2013 by Customer (Ytd)

Customer Group

Amount Billed For the year to date

R

Amount received For the year to date

R

Collection Rate (received/billed) For the year to

date %

Domestic 703 797 763 634 791 468 90%

Business 250 792 110 235 760 741 94%

Industrial 261 930 393 254 569 498 97%

Government 52 669 601 51 726 506 98%

School 16 005 011 15 385 510 96%

Church 7 055 466 5 925 073 84%

TOTAL 1 292 250 343 1 198 158 796 93%

39

Chart 3: Collection Rates for the year to 30 June 2013 – by customer (YTD)

7.2. COLLECTION RATE PERFORMANCE Table 15: Collection Rate comparative figures from 2007/08 onwards

2007/08 2008/09 2009/10

2010/11

2011/12

2012/13

Collection Rate for the months of June

97% 72% 100% 86% 97% 89%

Average Collection Rate for year to date

93% 88% 90% 93% 96% 94%

7.2.1 The Collection Rate for the period June 2013 is low in comparison to the previous

year. Year-to-date is lower than the previous year as shown in the table above.

40

7.3 OUTSTANDING DEBTORS (AMOUNTS OWED TO MCLM)

Chart 4: Total Outstanding Debtors as at 30 June 2013

7.3.1 The current debt outstanding and owed to the municipality is R922.9 million. Of this

82% is older than 30 days, as shown in chart 4 above. The detailed age analysis for total debtors is shown below in chart 5.

.

41

Chart 5: Age analysis of total outstanding debtors as at 30 June 2013

7.4 AGE ANALYSIS

Month Balance Current 30 days 60 days 90 Days 120 plus

July 882 584 253 121 923 836 109 073 151 27 388 245 23 065 348 601 133 673

August 894 892 555 223 717 801 26 437 284 69 585 504 11 862 575 563 289 390

September 907 226 415 122 122 711 85 331 748 25 920 972 63 241 424 610 609 561

October 888 089 327 217 195 230 36 384 159 21 778 876 13 369 112 599 361 950

November 892 921 276 224 903 586 32 819 673 22 507 550 17 053 001 595 637 465

December 891 770 519 204 799 281 47 121 812 17 634 383 18 337 920 603 877 124

January 896 199 187 208 490 323 42 801 549 21 922 552 14 383 620 608 601 143

February 905 949 373 228 443 022 40 990 410 19 025 317 21 145 979 596 344 645

March 919 904 350 228 853 334 42 731 877 19 981 617 32 656 550 595 680 971

April 910 733 299 238 523 129 40 742 046 22 907 669 15 412 478 593 147 976

May 909 608 571 244 606 376 33 185 535 22 695 720 19 030 605 590 090 335

June 922 973 788 276 743 029 19 027 579 18 803 369 16 690 681 536 270 148

42

CHART 6 AGE ANALYSIS YEAR TO DATE

-

100 000 000

200 000 000

300 000 000

400 000 000

500 000 000

600 000 000

700 000 000

800 000 000

900 000 000

1 000 000 000

Balance Current 30 days 60 days 90 Days 120 plus

July

August

September

October

November

December

January

February

March

April

May

June

7.5 MONTHLY INCOME VARIANCE ON CASH COLLECTION AS AT 30 June2013

Month Budget Income Actual Billed Variance

July

118 932 104 733

-14 199

August

118 932 113 339

-5 593

September

118 932 120 702 1 770

October

118 932 112 222 -6 710

November

118 932 98 676 -20 256

December

118 932 108 669 -10 263

January

118 932 98 684 -20 248

February

96 832 100 718 3 886

March

96 832 97 092 260

April

96 832 95 449 -1 383

May

96 832 103 597 6 765

June 96 832 105 400 8 568

43

7 .6 MONTHLY PAYMENT COLLECTION RATES AS AT 30 June 2013

Month Actual Billed Actual Income Payment Level

July

104 733 89 352 85%

August

113 339 105 711 93%

September

120 702 99 501 82%

October

112 222 109 373 97%

November

98 676 108 772 110%

December

108 669 101 927 94%

January

98 684 94 877 96%

February

100 718 85 053 84%

March

97 092 90 381 93%

April

95 449 99 941 105%

May

103 597 102 309 99%

June 105 400 93 307 89%

44

Chart 7 Monthly payment collection rates

45

7.8. PERFORMANCE OF DEBT COLECTORS

Table 19 Performance of debt collectors

COLLECTOR AMOUNT H/O COLLECTEDCORRECTIONS/

INDIGENTSDATE

NEW

OUTSTANDING

AFTER H/O

REVCO 161 514 716 12 578 124 46 857 692 2013-06-30 102 078 900

CREDITWORX 155 630 763 10 729 389 58 389 440 2013-06-30 86 511 933

MOODIE & ROBERTS 172 145 664 13 299 246 60 614 271 2013-06-30 98 232 147

REVCO 170 893 353 18 112 254 66 044 027 2013-06-30 86 737 072

CREDITWORX 204 827 095 25 973 386 65 965 378 2013-06-30 112 888 331

Truter, Crous & Wiggill 369 916 1 330 210 051 2013-06-30 158 534

Sundry Moodie & Roberts 37 685 448 28 204 28 449 534 2013-06-30 9 207 711

Total 903 066 955 80 721 934 326 530 393 495 814 628 The above table indicates the performance of debt collectors to date. Approximately 14% of the debt has been collected to date

46

8. RECOMMENDATIONS

1. That the Fourth Quarter In-Year Monitoring Report for the period 30th June 2013 be adopted.