Page 40 - KZN Film A Report

projected cash flows, that the AFS were prepared on a
going-concern basis
• Examined the AFS and other financial information made
public, prior to their approval by the board
• Considered accounting treatments, significant or unusual
transactions, and accounting judgements
• Considered the appropriateness of the accounting policies disclosed in the AFS and any changes made
thereto
• Considered any problems identified as well as any legal
and tax matters that could materially affect the financial statements
Based on the results of a formal, documented review of the design, implementation, and effectiveness of the organisation’s system of internal financial control (as conducted by the internal audit function); considering information and explanations given by management; and discussions with the external auditor on the results of their audit, the committee is of the opinion that KZN Film Commission’s system of internal financial controls is effective and formed a fair basis for the preparation of reliable financial statements for the 2020/21 financial year.
The ARC has also satisfied itself as to the integrity of the Annual Report.
Recommendation of the AFS and
Annual Report
Following the ARC’s review of the AFS of KZN Film Commission for the year ended 31 March 2021, the committee is of the view that, in all material respects, it complies with the relevant provisions of the PFMA, Companies Act (71 of 2008) and GRAP and fairly presents KZN Film Commission’s financial position at that date and the results of its operations and cash flows for the year then ended.
The committee recommended the AFS and the Annual Report for the year ended 31 March 2021 for approval to the board on 18 May 2021.
Refer to PART E: Annual Financial Statements
B-BBEE Compliance Performance
Information
The KZNFC performance in relation to BBBEE is documented in line with the scorecard elements and covers the key areas of:
• Management control
• Skills Development
• Enterprise and Supplier Development Element • Socio-Economic Development Element
The KZNFC underwent a BBBEE review which resulted in a Non-compliance score in 2019. This predominantly was linked to inadequate reporting to the respective authorities. During the year under review, a verification process was initiated by EDTEA but subsequently stopped due to the internal SCM processes. KZNFC has however appointed a service provider to advise and assist in strengthening BBBEE Compliance. KZNFC has increased its support to designated groups by ensuring that its funding and procurement is targeting these groups. Other initiatives being undertaken to increase support to designated groups include supplier open days and awareness sessions held with potential suppliers. More work is being undertaken to increase support to designated groups through among others targeting cooperatives which are mainly owned by women in rural areas, partnerships with Youth Development Agency to support youth owned enterprises and engagement with Military veterans associations to support enterprises owned by military veterans.
Enterprise and Supplier Development
The total spent on BBBEE suppliers was to the value of R23,295,023.16. The entity has ensured that the approved Transformation Policy has been implemented, which includes increased spending on BBBEE compliant suppliers. The target has primarily been on procuring from service providers that are Exempted Micro Enterprises (EME), Qualifying Small Enterprises (QSE) and B-BBEE status level between level 1 to level 3. This has enabled the entity to achieve a BBBEE spending of 119% (using the DTI calculation rate) against the target of 114%.
An amount of R3,934,903.93 was spent on Supplier Development programme and R156 630,00 for Enterprise Development for the year in terms of the BEE scorecard criteria.
Many of the initiatives that KZNFC has undertaken in terms of transformation are not considered for BEE scorecard as they are considered to be part of our mandate as KZNFC.
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KZN FILM COMMISSION ANNUAL REPORT 2020/2021