Entire Document - Chris Hani District Municipality

13.GRANTS-IN-AIDThe municipality transfers money to individuals, organisations and other sectors ofgovernment from time to time. When making these transfers, the municipality doesnot:♦♦♦Receive any goods or services directly in return, as would be expected in apurchase or sale transaction;Expect to be repaid in future; orExpect a financial return, as would be expected from an investment.These transfers are recognised in the Statement of Financial Performance asexpenses in the period that the events giving rise to the transfer occurred.14.VALUE ADDED TAXChapter 4The Municipality accounts for Value Added Tax on the Payments Basis in accordance withsection15(2)(a) of the Value-Added Tax Act (Act No 89 of 1991).15.UNAUTHORISED EXPENDITUREUnauthorised Expenditure is expenditure that has not been budgeted for, expenditurethat is not in terms of the conditions of an allocation received from another sphereof government, municipality or organ of state, and expenditure in the form of a grantthat is not permitted in terms of the Municipal Finance Management Act (Act No 56 of2003). All expenditure relating to Unauthorised Expenditure is accounted for as anexpense in the Statement of Financial Performance in the year that the expenditurewas incurred. The expenditure is classified in accordance with the nature of theexpense, and where recovered, it is subsequently accounted for as revenue in theStatement of Financial Performance. If the expenditure is not condoned by theCouncil, it is treated as an asset until it is recovered or written off as irrecoverable.16.IRREGULAR EXPENDITUREIrregular Expenditure is expenditure that is contrary to the Municipal FinanceManagement Act (Act No 56 of 2003), the Municipal Systems Act (Act No 32 of2000), the Public Office Bearers Act (Act No 20 of 1998), or is in contravention of theMunicipality’s or Municipal Entities’ Supply Chain Management Policies. IrregularExpenditure excludes Unauthorised Expenditure. Irregular Expenditure is accountedfor as an expense in the Statement of Financial Performance in the period it occurredand where recovered, it is subsequently accounted for as revenue in the Statementof Financial Performance. If the expenditure is not condoned by the Council, it istreated as an asset until it is recovered or written off as irrecoverable.273