2. Purpose of the Presentation Vision and Mission Background and Overview Human Resource Matters Artistic Performance Highlights for the Year Infrastructure / Capital Projects Actual Versus Budget & Budget Versus Actual Annual Report: Basis for qualified opinion by the Auditor General Annual Report: Irregular, Fruitless and Wasteful Expenditure Annual Report: Emphasis of Matters & Compliance with laws and Regulations: Council, Audit Committee, Internal Audit, Strategic Planning & Annual Performance Plan. Budgeting, Procurement, Contract and Asset Management. Transfer of Funds, Revenue and Expenditure Management. Institutional Challenges Conclusion PACOFS PRESENTATION TO THE PORTFOLIO COMMITTE ON ARTS AND CULTURE – WEDNESDAY, 07 NOVEMBER 2012 1

3. To brief the Portfolio Committee on Arts and Culture on the overall performance of PACOFS during the 2011-2012 financial period. To provide an overview of the activities in response to the constitutional and legislative mandate and policies, programmes, corporate plans. To solicit the Portfolio Committee ’ s inputs on the strategic interventions that may be required to fulfill the constitutional and legislative mandate in order to achieve the vision and mission of the PACOFS. PACOFS PRESENTATION TO THE PORTFOLIO COMMITTE ON ARTS AND CULTURE – WEDNESDAY, 07 NOVEMBER 2012 2

4. Vision  To be an ultimate professional performing arts destination. Mission  Presentation of quality transformed performing arts. PACOFS PRESENTATION TO THE PORTFOLIO COMMITTE ON ARTS AND CULTURE – WEDNESDAY, 07 NOVEMBER 2012 3

5.  Councils  Previous Council’s term ended August 2011: - Chairperson – Ms. Janet Kay  New Council appointed October 2011: - Chairperson – Mr. Rudolf Rashama  New Council Activities: - Signing of Share Holder’s Compact with the Minister of DAC- Mr. Paul Mashatile - Strategic Plan & Annual Performance Plan - Infrastructure Master Plan ( Capital Works Projects ) PACOFS PRESENTATION TO THE PORTFOLIO COMMITTE ON ARTS AND CULTURE – WEDNESDAY, 07 NOVEMBER 2012 4

6.  Staff Complement of 99 (57 Males and 42 Females).  Suspended CEO, Artistic Manager & Artistic Development Manager: - The Council initiated a disciplinary hearing against the suspended CEO. He resigned. - Artistic Manager’s disciplinary hearing has been finalized - Dismissal. - Artistic Development Manager suspended and dismissed - CCMA.  Salary discrepancy project in progress (Appointment of Genesis Group). PACOFS PRESENTATION TO THE PORTFOLIO COMMITTE ON ARTS AND CULTURE – WEDNESDAY, 07 NOVEMBER 2012 5

7.  INTERNATIONAL PRODUCTIONS HOSTED AT PACOFS  Smokie (UK Band)  Chinese/Taiwanese Orchestra Gala Evening  PARTNERSHIPS / CO-PRODUCTIONS HOSTED AT PACOFS  Ms Free State Pageant  Dance Connection & Simply the Best  Andre the Hypnotist  Wielie Wielie Wallie  Amandla  Beauty and the Beast  IN-HOUSE / OWN PRODUCTIONS (SHOWS)  The Letter  The Passion of Christ & Houtkruis  Cell Number 4  Money Maker PACOFS PRESENTATION TO THE PORTFOLIO COMMITTE ON ARTS AND CULTURE – WEDNESDAY, 07 NOVEMBER 2012 6

8.  COMPLETED INFRASTRUCTURE PROJECTS - Complex Roof - Stage Motorization Machinery - Lighting and Sound Systems  CURRENT INFRASTRUCTURE PROJECTS  Start date: July 2012 and end date: November 2012  Projects: - Sand Du Plessis – New Carpet - Office Renovations (Administration Block) - Fire and Smoke Detection System - Occupational Health and Safety - Upgrading of building to accommodate Disabled Persons (restrooms) - Workshop - New Roof and Insulation  FUTURE INFRASTRUCTURE PROJECTS - Complex Air-conditioning R32m - Implementation of the Infrastructure Master Plan (Depending on availability of Funding from DAC) PACOFS PRESENTATION TO THE PORTFOLIO COMMITTE ON ARTS AND CULTURE – WEDNESDAY, 07 NOVEMBER 2012 7

9. 8 BUDGET VS. EXPENDITURE PER PROGRAMME: 2012-2013 ORIGINAL BUDGETADJUSTMENTS CURRENT BUDGET ACTUAL 1 ST QUARTER ACTUAL 2ND QUARTER TOTAL ACTUAL R '000 Programme1/Administration 16 053 - 2 9863 8776 863 Programme2/Artistic Directorate 23 804 - 6 2556 14812 403 Programme3/ Technical Directorate 11 697 - 3 6001 5705 170 Total 51 554 - 12 84111 59524 436 Description2012 Actual (R’000)2012 Budget (R’000)2012 Variance (R’000) Total Revenue39 92042 584(2 664) Total Expenditure(45 992)(42 584)(3 408) Surplus/(deficit) for the year(6 072)-

10.  Opinion by the Auditor General  Qualified Audit Opinion.  Basis for Qualified Audit Opinion  PROPERTY, PLANT AND EQUIPMENT – GRAP17  The entity did not evaluate in all instances the residual values and useful lives of the assets at the reporting date in accordance with the Generally Recognized Accounting Practice 17.  Action Plan  Management to appoint a qualified service provider to assist with the full implementation of GRAP 17.  Management has advertised the posts of Finance Manager and Supply Chain Manager. PACOFS PRESENTATION TO THE PORTFOLIO COMMITTE ON ARTS AND CULTURE – WEDNESDAY, 07 NOVEMBER 2012 9

11.  Irregular, Fruitless and Wasteful Expenditure  PACOFS INCURRED IRREGULAR EXPENDITURE – R 3 355 792  ACTION PLAN:  Filling of the vacant positions and the appointment of the Qualified Finance and Supply Chain Managers in Current Financial Year. Management to seek the condonement on the matter from PACOFS Council.  PACOFS INCURRED FRUITLESS AND EXPENDITURE – R 1 293 026  ACTION PLAN:  Council and Management instituted disciplinary hearings and an all suspension cases were resolved by 2 nd Quarter of 2012/13. Management to seek the condonement on the matter from PACOFS Council.  Internal Audit  PACOFS FAILED TO ESTABLISH INTERNAL AUDIT FUNCTION  ACTION PLAN:  Management appointed Internal Audit Service Provider for a three year period 2012/13 to 2014/15: Ramabulana Management Services PACOFS PRESENTATION TO THE PORTFOLIO COMMITTE ON ARTS AND CULTURE – WEDNESDAY, 07 NOVEMBER 2012 10

12.  Procurement and Contract Management  PACOFS AWARDED A CONTRACT TO A BIDDER THAT DID NOT SCORE HIGHEST POINTS  The appointment of the service provider was based on BBBEE. The appointed service provider has the capacity as well as qualified personnel to execute the Project.  PACOFS APPOINTED A SERVICE PROVIDER BASED ON A DEVIATION  Management to seek a condonement on this matter from Council.  Expenditure Management  Implementation of ACCPAC Work-flow Financial Module for the monitoring of Budget vs. Actual Expenditure to avoid the overspending.  Asset and Liability Management  RECONCILIATION NOT PERFORMED ON A WEEKLY BASIS  Management procured a new financial system (ACCPAC) to improve the process of Asset Registering and Asset Management Reconciliation. PACOFS PRESENTATION TO THE PORTFOLIO COMMITTE ON ARTS AND CULTURE – WEDNESDAY, 07 NOVEMBER 2012 11

13.  Budget  THE BUDGET FOR FINANCIAL YEAR (2011-2012) WAS OVERSPENT DUE TO THE BUDGET NOT PROVIDING FOR THE DEPRECIATION.  Management will budget for depreciation as per GRAP 17 requirement.  Leadership  KEY POSITIONS BEING VACANT FOR A SIGNIFICANT PERIOD OF TIME.  ACTION PLAN:  Suspended CEO’s matter was resolved by Council in 2 nd Quarter of 2012/13.  CEO resigned and the Council intends to appoint new CEO in the 3 rd Quarter of 2012/13.  Financial and performance management  THE BUDGET FOR FINANCIAL YEAR (2011-2012) WAS OVERSPENT DUE TO THE BUDGET NOT PROVIDING FOR THE DEPRECIATION.  Management appointed an Internal Audit Firm to assist with the over sight, risk management and to strengthen the internal controls.  Management procured a new financial system (ACCPAC) to improve the process of bank & all reconciliation.  Governance  Council resolved to appointed the CFO as an Acting CEO. PACOFS PRESENTATION TO THE PORTFOLIO COMMITTE ON ARTS AND CULTURE – WEDNESDAY, 07 NOVEMBER 2012 12

14.  Leadership (Appointment of CEO & Artistic Director)  Lack of Capacity (Finance & SCM Managers)  Personnel / Staff Costs (70%)  Production Funding/Grants (In-House Shows)  Building & Maintenance Budget (Ownership)  Theatre / Stage Truck (Outreach Programmes) PACOFS PRESENTATION TO THE PORTFOLIO COMMITTE ON ARTS AND CULTURE – WEDNESDAY, 07 NOVEMBER 2012 13

15.  Thank You to All !!! PACOFS PRESENTATION TO THE PORTFOLIO COMMITTE ON ARTS AND CULTURE – WEDNESDAY, 07 NOVEMBER 2012 14