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BIJHB- Availability of the Annual Financial Statements for the year ended 30 June2017
CITY OF JOHANNESBURG METROPOLITAN MUNICIPALITY
(a municipality as described in section 2 of the Local Government Municipal Systems Act, 2000, duly
established in terms of Notice No. 6766, promulgated in the Provincial Gazette Extraordinary of 1
October 2000 in terms of section 12(1) read with section 14(2) of the Local Government : Municipal
Structures Act, 1998, as amended)
Issuer Bond Code: BIJHB
Bond Code: COJ04
ISIN No: ZAG000030941
Bond Code: COJ05
ISIN No: ZAG000054339
Bond Code: COJ07
ISIN No: ZAG000085044
Bond Code: COJ08
ISIN No: ZAG000137571
Bond Code: COJG01
ISIN No: ZAG000116708
AVAILABILITY OF THE ANNUAL FINANCIAL RESULTS FOR THE YEAR ENDED JUNE 2017
In terms of section 7.4 of the Debt Listings Requirements of the JSE Limited, investors are advised
that the City Of Johannesburg Metropolitan Municipality annual financial results for the year
ended 30 June 2017 are available for viewing and downloading at
https://joburg.org.za/index.php?option=com_content&Itemid=114&catid=60&id=501&lang=en&view=a
rticle&limitstart=1respectively.
The City of Johannesburg’s 2015/16 comparative figures were restated due to material errors that
were identified and reclassification of amounts which were previously disclosed. Presented below are
those items contained in the statement of financial position and statement of financial performance
that have been affected by prior-year adjustments.
PRIOR-YEAR ADJUSTMENTS
STATEMENT OF FINANCIAL POSITION
GROUP
Figures in Rand thousand
Description As previously Reclassification Correction of Restated
reported error
Consumer debtors 6,177,748 -167,123 -680,361 5,330,264
Property, plant and equipment 60,572,816 - -151,236 60,421,580
Intangible assets 1,098,835 - -21,450 1,077,385
Deferred Tax Asset 514,398 - 419,003 933,401
Receivables from exchange 1,933,430 -286,852 -591,791 1,054,787
transactions
Receivables from non exchange 200 120 453,975 - 654,095
transactions
Trade and Other payables -12,431,840 171,697 606,116 -11,654,027
VAT payables -183,447 - -102,060 -285,507
Current tax payable 902 - -518,127 -519,029
Deferred tax liability -2,398,950 - 2,836 -2,396,114
Provisions -733,060 -171,697 -83,615 -988,372
Other balance sheet items not listed -11,618,092 - 36,776 -11,581,316
Accumulated surplus -43,131,056 - 1,083,909 -42,047,147
CJMM
Figures in Rand thousand
Description As previously Reclassification Correction Restated
reported of error
CJMM - Trade and other receivable 4,847,465 -4,847,465 - -
CJMM - Consumer debtors 887,113 -887,113 - -
CJMM - Receivables from exchange - 4,390,035 -518,934 3,871,101
transactions
CJMM - Receivables from non- - 1,344,543 -6,658 1,337,885
exchange transactions
CJMM - Property, plant and 35,662,469 - -72,528 35,589,941
equipment
CJMM - Intangible assets 496,678 - -35,491 461,187
CJMM - Trade and other payables -11,220,385 - 198,638 -11,021,747
CJMM - Other 6,832,244 - -21,090 6,811,154
CJMM - Accumulated Surplus -28,223,680 - 221,164 -28,002,516
TOTAL 9,281,904 - -234,899 9,047,005
STATEMENT OF FINANCIAL PERFORMANCE
GROUP
Figures in Rand thousand
Description As previously Reclassification Correction Restated
reported of error
Rendering of services 23,477,479 - -148,943 23,328,536
Rental of facilities and equipment 290,699 - -44,146 246,553
City Cleaning levy - - 111,999 111,999
Debt impairment -2,492,311 - 8,937 -2,483,374
Depreciation and amortisation -2,794,027 - -15,148 -2,809,175
Repairs and maintenance -1,282,056 1,282,056 - -
General expenditure -5,565,453 -1,282,056 -155,863 -7,003,372
Fair value adjustment 546,031 -160,183 385,848
Other -8,363,171 107,563 -8,255,608
Surplus (deficit) for the year 3,817,191 -295,784 3,521,407
CJMM
Figures in Rand thousand
Description As previously Reclassification Correction Restated
reported of error
CJMM - Rental of facilities and -133,566 - 43,841 -89,725
equipment
CJMM - Contracted services 1,724,656 - 57,200 1,781,856
CJMM - Repairs and Maintance 398,993 -398,993 - -
CJMM - Provision 15,000 -15,000 - -
CJMM – General Expenses 2,809,377 413,993 102,325 3,325,695
CJMM - Other -7,571,110 - 31,533 -7,539,577
(Deficit) Surplus for the year -2,756,650 - 234,899 -2,521,751
1. Consumer debtors & rendering of services
The City has recalculated the accrual amount for the revenue for the 2015 and 2016 financial years.
This has resulted in a decrease in the consumer debtors' balance.
2. Property, plant and equipment (PPE)
The error on PPE arises from the vehicles that were not previously capitalised. Correction of this error
resulted in adjustments of 2016 depreciation and accumulated surplus for previous financial years.
Refuse bins were initially accounted for as PPE instead of consumables. Management established
that there was no control over these bins. Prior year adjustment was processed to correct this error.
3. Receivables from exchange transactions
The restatement is as a result of an adjustment of debtors which were incorrectly recognised. There
was a reversal of provision for doubtful debt which were incorrectly accounted for in the previous
financial year.
4. Trade and other payables
Retrospective adjustment for accruals not accounted for in the previous financial period.
5. VAT payables
Sale of electricity to Eskom was misstated in 2016. Restatement of these sales transactions also
resulted in adjustment of VAT output
6. City cleaning levy
Income and expenditure line items - including "clean levy" were fair valued and aggregated using
SAICA circular 9 , which was later found not to be applicable to municipalities. To correct prior year
error, fair value adjustment amount was reversed to all line-items affected by valuation.
7.Provisions
Reclassification of bonus provision which was initially classified as accruals.
8. Repairs and maintenance
Repairs and maintenance was reclassified to general expenditure
9. Deferred Tax Asset
Penalties and interest arising from taxation liability with South African Revenue Services has been
accrued in the respective financial years starting in 2015 financial year. The SARS current tax liability
has been reclassified from deferred tax liability
10. Intangible asset.
The error on the intangible assets and general expenses relates to previous expenditure incorrectly
capitalised as intangible asset.
Reclassifications
Trade and other receivables, Receivable from exchange non-transactions & Consumer
debtors.
The reclassification was to ensure that debtors are classified as either exchange or non-exchange
Consumer debtors were reclassified to receivables from non-exchange transaction.
City cleaning levy was reclassified from consumer debtors to receivables from exchange transactions.
Reclassification 1
Repairs and maintenance and General Expenses
The reclassification was to ensure that the income statement line items are all presented in their
nature not function. Repairs and maintenance has been reclassified into general expenses as it is a
function of expenditure rather than nature thereof.
Johannesburg
31 January 2018
Debt Sponsor
Absa Bank Limited (acting through its Corporate and Investment banking division)
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