Page 118 - TKZN Annual Report 2023/2024

KWAZULU-NATAL TOURISM AUTHORITY
Trading as Tourism KwaZulu-Natal
Annual Financial Statements for the year ended 31 March 2024
Significant Accounting Policies
1.13 Revenue from non-exchange transactions (continued)
The entity recognises an asset in respect of transfers when the transferred resources meet the definition of an asset and satisfy the criteria for recognition as an asset.
Transferred assets are measured at their fair value as at the date of acquisition.
1.14 Translation of foreign currencies
Foreign currency transactions
A foreign currency transaction is recorded, on initial recognition in Rands, by applying to the foreign currency amount the spot exchange rate between the functional currency and the foreign currency at the date of the transaction.
At each reporting date:
• foreign currency monetary items are translated using the closing rate;
• non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange
rate at the date of the transaction; and
• non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the
date when the fair value was determined.
Exchange differences arising on the settlement of monetary items or on translating monetary items at rates different from those at which they were translated on initial recognition during the period or in previous annual financial statements are recognised in surplus or deficit in the period in which they arise.
When a gain or loss on a non-monetary item is recognised directly in net assets, any exchange component of that gain or loss is recognised directly in net assets. When a gain or loss on a non-monetary item is recognised in surplus or deficit, any exchange component of that gain or loss is recognised in surplus or deficit.
Cash flows arising from transactions in a foreign currency are recorded in Rands by applying to the foreign currency amount the exchange rate between the Rand and the foreign currency at the date of the cash flow.
1.15 Comparative figures
Where necessary, comparative figures have been reclassified to conform to changes in presentation in the current year.
1.16 Fruitless and wasteful expenditure
Fruitless expenditure means expenditure which was made in vain and would have been avoided had reasonable care been exercised.
Fruitless and wasteful expenditure is accounted for in line with all relating requirements, including, but not limited to, ruling Legislation, Regulations, Frameworks, Circulars, Instruction Notes, Practice Notes, Guidelines etc (as applicable).
1.17 Irregular expenditure
Irregular expenditure as defined in section 1 of the PFMA is expenditure other than unauthorised expenditure, incurred in contravention of or that is not in accordance with a requirement of any applicable legislation, including -
(a) this Act; or
(b) the State Tender Board Act, 1968 (Act No. 86 of 1968), or any regulations made in terms of the Act; or
(c) any provincial legislation providing for procurement procedures in that provincial government
On 20 May 2019, National Treasury issued and published National Treasury instruction No. 2 of 2019/20 in terms of section 76(2)(e) and 76(4)(a) of the Public Finance Management Act No. 1 of 1999 (hereafter the PFMA), and concomitant Irregular Expenditure Framework with the purpose, to further regulate irregular expenditure in provincial departments and public entities, subject to the PFMA and as set out in the Irregular Expenditure Framework, which outlined generic procedures for accounting officers and accounting authorities when dealing with irregular expenditure.
Previously, irregular expenditure was dealt with in terms of National Treasury practice note 4 of 2008/09 and the 2018 rregular Expenditure Framework, which has now been rescinded.
116 TOURISM KWAZULU-NATAL ANNUAL REPORT 2023/2024