Page 362 - Department of Social Development Annual Report 2021

PART E: FINANCIAL INFORMATION

STATE PRESIDENT FUND

Notes To The Financial Statements Of The State President Fund For The Year Ended
31 March 2021.

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES • IGRAP 9: Distributions of Non-cash Assets to Owners 1.4.2 Revenue from non-exchange transactions
• IGRAP 10: Assets Received from Customers Financial Liabilities
The annual financial statements have been prepared in • IGRAP 11: Consolidation - Special Purpose Entities Revenue from non-exchange transactions refers to The Fund's principle financial liabilities are accounts
accordance with the effective Standards of Generally • IGRAP 12: Jointly Controlled Entities – Non-Monetary transactions where the entity received revenue from payable. All financial liabilities are measured at
Recognised Accounting Practice (GRAP) including any Contributions by Ventures another entity without directly giving approximately amortised cost, comprising original debt less
interpretations, guidelines and directives issued by the • IGRAP 13: Operating Leases – Incentives equal value in exchange. Revenue from non-exchange principle payments and amortisations
Accounting Standards Board. • IGRAP 14: Evaluating the Substance of Transactions transactions is generally recognised to the extent that
involving the Legal Form of a Lease the related receipt or receivable qualifies for 1.8 EXPENDITURE
The following are the principal accounting policies of • IGRAP15 – Revenue – Barter Transactions involving recognition as an asset and there is no liability to
the Fund which are, in all material respects, consistent Advertising Services repay the amount Revenue from the recovery of Expenditure is accounted for on the accrual basis of
with those applied in the previous year, except as • IGRAP 16: Intangible Assets – Website Costs unauthorised, irregular, fruitless and wasteful accounting.
otherwise indicated. • IGRAP 17: Interpretation of the Standard of GRAP on expenditure is based on legislated procedures,
Service Concession Arrangements where a Grantor
1.1 BASIS OF PREPARATION Controls a Significant Residual Interest in an asset. 1.5. INVESTMENTS

The annual financial statements have been prepared in 1.2 CURRENCY Investments are shown at cost including interest
accordance with the effective Standards of Generally capitalized.
Recognised Accounting Practice (GRAP) including any These financial statements are presented in South
interpretations, guidelines and directives issued by the African Rands. All figures are rounded to the nearest 1.6 COMPARATIVE FIGURES
Accounting Standards Board. one thousand.
Where necessary, comparative figures have been
1.1.1 The following approved Standards of GRAP have 1.3. PROPERTY PLANT AND EQUIPMENT adjusted to conform to changes in presentation in the
been approved and issued by the Accounting Standards current year.
Board, but only become effective in the future or have Items of property, plant and equipment are initially
not been given an effective date by the Minister of recognized as on acquisition date and are initially 1.7 FINANCIAL INSTRUMENTS
Finance. The fund has not early-adopted any new recorded at cost.
Standards but has in some cases referred to them for Recognition
guidance in developing appropriate accounting 1.4. REVENUE RECOGNITION Financial assets and liabilities are recognised in the
policies in accordance with the requirements of balance sheet when the Fund becomes a party to the
Directive 5: Determining the GRAP Reporting Revenue is recognized when it is probable that future contractual provisions of the instrument.
Framework: economic benefits will flow to the fund and these
benefits can be measured reliably. Measurement
• GRAP 20: Related Party Disclosures Financial instruments are initially measured at fair
Interest income is accrued on a time proportion basis, value, which includes transaction cost. Subsequent to
1.1.2 The following interpretations have also been taking into account the principal outstanding and the initial recognition these instruments are measured as
issued and are expected to have an insignificant effective interest rate over the period to maturity. set out below.
impact on the financial statements, since they
generally reflect the interpretations and principles 1.4.1 Revenue from exchange transactions Financial assets
already established under IFRS. The Fund's principal financial assets are cash and
Revenue from exchange transactions refers to cash equivalents.
• IGRAP 1: Applying the Probability Test on initial revenue that accrued to the entity directly in return All financial assets are measured at amortised cost,
Recognition of Revenue for services rendered or goods sold, the value of comprising original debt less principle payments and
• IGRAP 2: Changes in Existing Decommissioning which approximates the consideration received or amortisations
Restoration and Similar Liabilities receivable.
• IGRAP 3: Determining Whether and Arrangement Investments
Contains a Lease Interest revenue is recognised on a time proportion The investments are measured at subsequent
• IGRAP 4: Rights to Interests Arising from basis. reporting dates at amortised cost by using the
Decommissioning, Restoration and Environmental effective interest rate method if they have a fixed
Rehabilitation Funds Revenue from the rental of facilities and equipment is maturity or at cost if there is no fixed maturity.
• IGRAP 5: Applying the Restatement Approach under recognised on a straight-line basis over the term of
the Standard of GRAP on Financial Reporting in the lease agreement. Cash and cash equivalents
Hyperinflationary Economies Cash and cash equivalents comprise cash on hand and
• IGRAP 6: Loyalty Programmes Revenue from the sale of goods is recognised when investments. Cash and cash equivalents are measured
• IGRAP 7: The Limit of a Defined Benefit Asset, substantially all the risks and rewards in those goods at fair value.
Minimum Funding Requirements and their is passed to the consumer.
Interaction
• IGRAP 8: Agreements for the Construction of Assets
from Exchange Transactions

DEPARTMENT OF SOCIAL DEVELOPMENT ANNUAL REPORT 2020/21 362