Page 364 - 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.

1.9 Provisions
Provisions are recognized when the entity has a present or constructive obligation as a result of past events, it is
probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a
reliable estimate of the provision can be made.
Provisions are reviewed at reporting date and adjusted to reflect the current best estimate

Notes 2020/21 2019/20
R’000 R’000

2 Revenue
Interest received 1 698 2 906
Total 1 698 2 906

3 Administrative Expenditure
Bank Charges 1 1

Financial assistance 1 1
Total
29 28
4 Audit Fees

5 Risk Management

5.1 Financial Risk Factors

5.1.1 Market Risk
Market risk is the risk that changes in market prices. Interest rates will affect the State President Fund. The
objective of market risk management is to manage and control market risk exposure within acceptable parameters
while optimizing return. The State President Fund does not manage this risk aggressively as the investments of
funds are determined by the Minister of Social Development and the Minister of Finance. Within these parameters,
funds are invested with reputable financial institutions.

DEPARTMENT OF SOCIAL DEVELOPMENT ANNUAL REPORT 2020/21 364