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SESSION 13 SUMMARISING THE SEGMENTS OF THE CHART PRESENTED BY: NATIONAL TREASURY

SESSION 13 SUMMARISING THE SEGMENTS OF THE CHART PRESENTED BY: NATIONAL TREASURY. EXAMPLE 1.

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SESSION 13 SUMMARISING THE SEGMENTS OF THE CHART PRESENTED BY: NATIONAL TREASURY

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  1. SESSION 13 SUMMARISING THE SEGMENTS OF THE CHART PRESENTED BY: NATIONAL TREASURY

  2. EXAMPLE 1 The Premiers Office North West Province outsources the personal security and bodyguard services for the MEC to Securicor 4. The monthly contract fees is budgeted for under voted funds, programme 1, Administration and subprogramme 1, Premier Support and amounts to R20 000 per month. The MEC serves the whole of the province. How should this payment be classified in the financial system?

  3. ANSWER EXAMPLE 1

  4. EXAMPLE 2 The department of Transport and Community Safety in the North West Province outsources the security services of the building that they rent on a monthly basis to Maxicor security services. The monthly contract fees is budgeted for under voted funds, programme 1, Administration and subprogramme 3, Corporate Support and amounts to R35 000 per month. The department of Transport and Community Safety serves the whole of the province. How should this payment be classified in the financial system?

  5. ANSWER EXAMPLE 2

  6. EXAMPLE 3 • The Provincial Department of Health Gauteng receives invoices for the following services and pays it from voted funds under programme 8, Health Facility Management and subprogramme 6, Other Facilities. The Provincial Department of Health Gauteng serves the whole of the province. How should these payments be classified in the financial system? • Squeaky clean carwash for the cleaning and valet of the MEC Health’s Official vehicle • Cleaning of the nurses and doctors theater jackets • Payment to the monthly contracted firm “Clean a mop” for the cleaning of the office building • Laundromat for the cleaning of the boardroom’s curtains of the office building

  7. ANSWER EXAMPLE 3

  8. EXAMPLE 4 The National Department of Social Development rent a photocopier from Nashua through tender NT03/2004 and this contract qualifies as an operating lease. The Photocopier is used by the unit who administrates the Social Relief Fund. The amounts for the Social Relief Fund are all appropriated as specifically and exclusively in the appropriation act. Programme 2, Comprehensive Social Security and subprogramme 8, Administration is used to record the spending. The service provider is Gauteng based. How should this payment be classified in the financial system?

  9. ANSWER EXAMPLE 4

  10. EXAMPLE 5 The Limpopo Department of Roads and Transport makes a payment of R80 000 to GROUP 5 which is an outsourced contractor in relation to a contract to rehabilitate the R518 provincial tar road between Lephalale and Mookgopong. The R518 is valued at R500 000 and is used by all the Waterberg municipalities. The road is an existing piece of infrastructure and is classified as a provincial asset. Spending take place through programme 2, Roads and Infrastructure and the subprogramme 4, Construction. Funding for this project has been provided by the Government of Botswana as part of donor funding. How should this payment be classified in the financial system?

  11. ANSWER EXAMPLE 5

  12. EXAMPLE 6 • The department of Water Affairs is constructing a water dam on own account to serve all the Zululand municipalities. The amounts are specifically and exclusively appropriated for in the appropriation act under Bulk Infrastructure: Indirect Grant. Spending will take place against programme 2, Water Resources Management and subprogramme 13, Infrastructure Development and Rehabilitation. The Department is using of its own employees for the construction and project management. The department also purchases the following goods and services into the project: • Cement and bricks • Purification equipment worth R20 000 a piece • Professional service of a structural engineer • How should all of the above be classified in the financial system?

  13. ANSWER EXAMPLE 6

  14. EXAMPLE 7(a) • The following transaction is funded from voted funds in programme 3, Financial Management subprogramme 4, Financial Reporting in the Provincial Treasury Kwa-Zulu Natal. The Provincial Treasury is serving the whole of the province. • Purchase a Microsoft Office package having a useful life of more than one year, for a new post created in the financial section for R1000.

  15. ANSWER EXAMPLE 7 (a)

  16. EXAMPLE 7(b) The following transaction is funded from voted funds in programme 3, Financial Management subprogramme 4, Financial Reporting in the Provincial Treasury Kwa-Zulu Natal. The Provincial Treasury is serving the whole of the province. b) The Provincial Treasury have plans to develop and implement a sub system that will manage their guarantees issued, the system is customised for the needs for the use by the Provincial Treasury only, the system will qualify as an intangible asset in the books of the department. The project is set out on tender and awarded to private contractors. Employees employed by the department will assist on a full time basis with the implementation and maintenance of the system.

  17. ANSWER EXAMPLE 7 (b)

  18. EXAMPLE 7(c) The following transaction is funded from voted funds in programme 3, Financial Management subprogramme 4, Financial Reporting in the Provincial Treasury Kwa-Zulu Natal. The Provincial Treasury is serving the whole of province. c) A new computer (R7000) with enabling software (R3000) is purchased for the Director of Finance.

  19. ANSWER EXAMPLE 7 (c)

  20. EXAMPLE 7(d) The following transaction is funded from voted funds in programme 3, Financial Management subprogramme 4, Financial Reporting in the Provincial Treasury Kwa-Zulu Natal. The Provincial Treasury is serving the whole of the province. d) An annual license fee of R500 is paid for the upgrade of the excel package for the new post created in the financial management unit.

  21. ANSWER EXAMPLE 7 (d)

  22. EXAMPLE 8 The department of Education in the Eastern Cape outsourced the painting of the Theron primary school building in the Port St Johns municipal area to a private construction company. The total cost of the project is R5 million for a school valued at R500 million and belongs to the Department of Education, which therefore implies a current maintenance project. The spending of this project will be funded from donor funding received from the Danish Government and will be recorded in programme 4, Public Special Schools and subprogramme 1, Schools. How should this payment be classified in the financial system?

  23. ANSWER EXAMPLE 8

  24. EXAMPLE 9 The National Department of Housing pays a conditional grant of R8 mil to the Western Cape Department of Housing. Funds are appropriated in the appropriation act and the Division of Revenue Act as conditional grants. The transaction will be recorded on programme 4, Housing Development Finance and subprogramme 6, Integrated Housing and Human Settlement Development Grant. How should this payment be classified in the financial system?

  25. ANSWER EXAMPLE 9

  26. EXAMPLE 10 The Department of Public Works in the Free State sold an old office building at an auction. How will the revenue be allocated in the books of the department?

  27. ANSWER EXAMPLE 10

  28. For any additional questions or issues for clarification, please contact the National Treasury SCOA Technical Committee at: • Call centre: (012) 315 5311 • E-mail: scoa@treasury.gov.za • Website: http://scoa.treasury.gov.za

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