1. Accounting Standards Board Annual report Presented by: Erna Swart CEO

2. Overview Performance Financial performance Cost containment Strategy of the ASB 2015 - 2019 Letter dated 23 July 2014

3. Performance

4. Mandate of ASB Promote transparency in and effective financial management of REAL Set Standards of GRAP as required by financial management legislation Prepare and publish guidelines and directives Recommend implementation dates to MoF after Auditor-General consulted

5. Presidential outcomes We contribute to the following: 9 – The achievement of a responsive, accountable, effective and efficient local government system 12 – An efficient and effective development oriented public service

6. Influence development of international standards Set Standards of GRAP Facilitate the implementation of Standards of GRAP Monitor the application of Standards of GRAP Realise the potential of our people Communicate with our stakeholders Manage ASB efficiently, effectively and economically Objectives

7. Entities applying GRAP Parliament and (some) provincial legislatures; municipalities, municipal entities, any other entities under the ownership control of a municipality & boards, commissions, companies, corporations & funds national and provincial public entities constitutional institutions trading entities Public FET Colleges

8. Entities that need to adopt Some provincial legislatures National and provincial departments Transitional provisions and other transitional arrangements will need to be developed Use experience gained in IPSASB project

9. Influence development of international standards Member of IPSASB Member of 4 international task based groups Concurrent exposure of international exposure drafts Submitted 11 comment letters on international exposure drafts With SAICA commented on 4 more Support to IPSASB secretariat on Project on First Time Implementation

10. Set Standards of GRAP Biannual improvements to GRAP Amendment to GRAP 23 – services in kind ED Accounting by Principals and Agents Standard on Statutory Receivables Standard on Service Concession Arrangements Interpretation on Service Concession Arrangements: Where a grantor controls a significant residual interest in an asset

11. Facilitate the implementation of Standards of GRAP Developed transitional provisions for: –Statutory receivables –Service concessions –Changes in measurement bases following the adoption of GRAP GRAP reporting framework Developed Directives for implementation by SARS and FET colleges

12. Monitor the application of the Standards of GRAP First post-implementation review completed Objective: –To assess whether users of financial statements use the information in the financial statements –To identify improvements based on user and preparer input Outcome: Several new projects added to ASB work programme for 2014/15

13. Monitor the application of the Standards of GRAP SCOA for municipalities Articles for E&Y(International), SAIGA, SAICA & IMFO

14. Realise the potential of our people Technical staff are all CA(SA)s Focus on staff development Coaching Retention of key staff 66% of costs are staff remuneration

15. Communicate with our stakeholders Newsletter Articles for journals Reached all nine provinces Reached users through the PIR Preparers in national departments are not participating

16. Manage the ASB in an efficient effective and economic way Good governance Clean audit Internal audit identifies some housekeeping issues, but no significant issues: –Number of training days omitted from quarterly report –Improvements needed to business continuity plan & disaster recovery plan Implementation of ICT policy framework

17. Financial performance Drivers of cost Summary of results

18. Cost drivers 6 employees of which 4 are CA(SA)s Continuous training Remuneration increases can exceed CPI Four board meetings per year with at least 3 technical documents per meeting Board members paid SAICA rates Board members are also members of MANCO Extensive stakeholder consultation International involvement Small office with very little flexible costs

19. Summarised results 2014 (R’000) 2013 (R’000) Budget (R’000) Transfer payment9 9519 09611 200 Other income219143110 Revenue10 1709 23911 310 Staff remuneration6 6756 2757 421 Board remuneration306461620 Travel867662886 Training207249232 Communication8474154 Printing & Publishing111102111 Administration1 7031 3581 722 Expenditure9 9549 69711 147

20. Cost containment Since 2008 –Renegotiated lease escalation from 10% pa to 8% pa –Renegotiated cost of all services In 2014 –Renegotiated lease escalation from 8% pa to 5.5% pa –SAICA pays travel cost for workshops done on their behalf –Cancelled all subscriptions except use of IPSAS & professional membership fees

21. Cost containment beyond 2014 Proposed cut in transfer payment of R 438 000 for 2015/16 & R657 000 in 2016/17 Can only accommodate if no training, travelling & printing is incurred Filled vacancy in September 2014

22. Strategy going forward Review legislative mandate Establish project group to identify barriers to GRAP implementation by National & Provincial Departments Business as usual

23. Letter dated 23 July 2014 Mechanism to consult with Members of Parliament Clarification of mandate Capacity building by inclusion in relevant curricula of HEIs

24. Contact details CEO: Erna Swart Tel: (011) 697-0660 Fax: (011) 697-0666 Website: www.asb.co.zawww.asb.co.za Email: info@asb.co.za