1. PRESENTATION TO PARLIAMENTARY PORTFOLIO COMMITTEE ON HIGHER EDUCATION AND
TRAINING
9 OCTOBER 2018

2. CONTENTS Introduction MICT SETA Sector Profile Past Performance
Status of the SETA
Financial Information
Audit Outcomes
Corrective Measures

3. INTRODUCTION

4. MICT SETA TEAM Sihle Ngubane - Chairperson of the Board
Thabo Mofokeng - EXCO and Board Member
Charlton Philiso - Acting Chief Executive Officer
Noni Gontshi - Chief Financial Officer
Sekgana Makhoba - Senior Manager: Sector Skills Planning
Xabiso Matshikiza - Manager: Marketing and Communications

5. MICT SETA SECTOR PROFILE
Tele-communications
11%
Information Technology
53%
Advertising
12%
Electronics
13%
Film & Electronic
Media 11%
Currently employers in the sector
A 12.9% increase from the previous year

6. Learning Intervention
PAST PERFORMANCE
Learning Intervention
Actual Achievement
2013/14
2014/15
2015/16
2016/17
2017/18
Total
Learnerships
2 500
3 824
3 539 
4 052
1 056 
14 971
Bursaries
469
320
1067
599
175 
2 630
Internships
885
1 086
565
1 500
1 673 
5 709
Skills Programmes
663
1 100
1 750
2 525
1 182 
7 220

7. STATUS OF THE SETA

8. SETA PROBE UPDATE
Forensic Report: Completed
Special Investigating Unit (SIU): Ongoing
Public Protector: Ongoing

9. FINANCIAL INFORMATION

10. FINANCIAL PERFORMANCE

11. FINANCIAL PERFORMANCE

12. FINANCIAL PERFORMANCE
Per financial year
Audited
R'000
2017/18
2016/17
2015/16
2014/15
Skills development levy income
817 844
742 891
702 301
659 912
Income growth %
10.09%
5.78%
6.42%
8.77%
Discretionary grant expenditure
611 339
721 228
502 062
478 587
Mandatory grant expenditure
154 245
144 520
140 927
130 382
Mandatory grant pay-out %
76%
80%
81%
78%
Administration expenditure
79 397
74 456
68 326
61 572
Surplus/(deficit)
11 334
(149 966)
31 601
19 819

13. FINANCIAL PERFORMANCE
Per financial year
Audited
R'000
2017/18
2016/17
2015/16
2014/15
Cash and cash equivalents (A)
361 230
334 687
418 234
439 105
Receivables (B)
4 688
19 413
59 639
51 868
Payables ( C )
109 507
109 149
83 212
130 076
Commitments ( D )
302 962
344 034
394 067
365 982
Cash deficit declared to NT (A+B-C-D)
(46 551)
(99 083)
594
(5 085)
Total reserves
261 055
249 619
399 586
366 932
Discretionary reserves
256 166
244 868
394 267
361 102
% of commitments vs. discretionary reserves
118%
140%
100%
101%

14. FINANCIAL PERFORMANCE
Overall the financial viability assessment of MICT SETA is favourable based on the following:
The creditors collection period is sitting at 13.1 days compared to credit terms of 30 days.
The entity have a surplus in the current year compared to significant loss in the prior financial year, with positive cash flows from operating activities, accompanied with a significant increase in the cash and cash equivalents balance compared to the prior financial period.
The net asset liability position of the MICT SETA is positive.
The SETA’s financial viability is relatively good, as indicated by the assessment above.

15. AUDIT OUTCOMES

16. AUDIT REPORT HISTORY 2017/18 unqualified audit report with findings.
13 years Unqualified Audit Reports, of which:
- 7 years of Unqualified Audit Report (2002, 2003, 2007 – 2011).
- 6 years of PFMA Unqualified Audit with no findings (Clean Audit) (2012 – 2017).
The MICT SETA has received the PFMA Clean Audit Award and Certificate of Excellence for the 6 financial years (2011/12 – 2016/17) from the Auditor General.

17. LATEST AUDIT OUTCOME
Overall outcome – unqualified audit opinion:
Material adjustments in the disclosure of commitments balance
Emphasis of Matter:
- Irregular expenditure
- Related party disclosure

18. CORRECTIVE MEASURES

19. GOVERNANCE
New Board Appointment
Governance Sub-Committee
New Audit and Risk Committee
Review of the Delegation of Authority

20. BOARD INTERVENTIONS Vacant Executive Positions:
- Board Secretary position filled
- Senior Manager: Corporate Services
Role of Board in regards to the allocation of Discretionary Grants
Concluding outstanding case of previous CEO
Board engagement with Special Investigating Unit (SIU)

21. CORRECTIVE MEASURES New Discretionary Grants Policy
Ongoing approval of applications by the EXCO and Board
Full automation of Service Level Agreements (SLA) process
Alignment of SLA dates
Review of the Delegation of Authority
All tenders are subjected to Internal Audit review
Consequence management
Improved contract management processes

22. Q & A

23. Thank you