2007 / 2008 Annual Report - Eastern Cape Development Corporation

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EASTERN CAPE DEVELOPMENT CORPORATION 2007/08DIRECTORS’REPORTName Appointed ResignedNkuhlu, W.L. (Chairperson) 01/07/2006Buthelezi, S 01/03/2007Burwana-Bisiwe, N 01/03/2007 31/07/2007Kusi, N 01/07/2006 31/12/2007Fikeni, S 01/03/2007Heynes, E 01/03/2007Ndabeni, M 01/03/2007Nodada-Qhali, T 01/03/2007Nonkwelo, L 01/03/2007Pakati, X 01/03/2007Tabata, S 01/03/2007Mfenyana, S.A.H 01/10/2007Mawala, F 01/01/2008Fees paid to Directors and Audit Committee members during the financial year were as follows:Figures in randsBoard of Directors Board Attendance Audit Committee Attendance Grand TotalNkuhlu, W.L. (1) - - -Buthelezi, S 21,000 4,000 25,000Burwana-Bisiwe, N (2) - - -Kusi, N (2) - - -Fikeni, S 24,000 - 24,000Heynes, E 21,000 10,000 31,000Ndabeni, M 29,000 - 29,000Nodada-Qhali, T 24,000 6,000 30,000Nonkwelo, L 32,000 - 32,000Pakati, X 26,000 - 26,000Tabata, S 30,000 - 30,000Mfenyana, S.A.H (2) - - -Mawala, F (2) - - -OtherNjeke, J - 12,000 12,000Rajdhar, R - 2,000 2,000Nicholls, R - 4,000 4,000Total 207,000 38,000 245,000Notes: (1) Elected not to receive board fees.(2) These directors are government representatives and are not allowed to receive remuneration.Fees68
EASTERN CAPE DEVELOPMENT CORPORATION 2007/0814 Going concernThe Annual Financial Statements have been prepared on the going concern basis. This basis of accounting has beenadopted by the Board of Directors after having made enquiries from management and given due considerationto information presented to the Board, including budgets and cash flow projections for the year ahead and keyassumptions and accounting policies relating thereto. The corporation maintains a very strong solvency and liquidityposition. Accordingly, the Directors have no reason to believe that the Corporation and its subsidiaries will not continueas a going concern in the year ahead.15 Directors’ ResponsibilitiesIn terms of the Public Finance Management Act, 1999 (Act No. 1 of 1999, as amended), directors are required tomaintain adequate accounting records and are responsible for the content and integrity of the annual financialstatements and related financial information included in this report. The directors are further responsible to ensure thatthe annual financial statements fairly present the state of affairs of the Corporation as at the end of the financial year,and the results of its operations and cash flows for the period then ended, in conformity with South African Statementsof Generally Accepted Accounting Practice. The external auditors are engaged to express an independent opinion on theannual financial statements. The annual financial statements of the Corporation are prepared in accordance with SouthAfrican Statements of Generally Accepted Accounting Practice and are based upon appropriate accounting policiesconsistently applied and supported by reasonable and prudent judgments and estimates.The directors acknowledge that they are ultimately responsible for the system of internal control established by theCorporation and place considerable importance on maintaining a strong control environment. The board of directorssets standards for internal control aimed at reducing the risk of error or loss in a cost effective manner. These standardsinclude proper delegation of responsibilities within a clearly defined framework, effective accounting procedures andadequate segregation of duties to ensure an acceptable level of risk. These controls are monitored as far as reasonablypossible throughout the Corporation and all employees are required to maintain the highest ethical standards inensuring the Corporation’s business is conducted in a manner that in all reasonable circumstances is above reproach.The focus of risk management in the Corporation is on identifying, assessing, managing and monitoring all knownforms of risk across the Corporation. Operating risk cannot be fully eliminated, however the Corporation endeavoursto minimise it by ensuring that appropriate infrastructure, controls, systems and ethical behaviour are in place. Thedirectors are of the opinion, based on the information and explanations provided by Management, that apart fromthe matters raised under paragraph 3.7 - Investment Properties and paragraph 12 - Subsidiaries, above, the systemof internal control provides reasonable assurance that the financial records may be relied upon for the preparation ofannual financial statements. Any system of internal control can, however, provide only reasonable, and not absolute,assurance against material misstatement or loss.The directors have reviewed the Corporation’s cash flow forecast for the year to 31 March 2009 and, in the light of thisreview and current financial position, are satisfied that the Corporation has and has access to adequate resources tocontinue its operational existence for the foreseeable future. The consolidated annual financial statements set out onpages 64 to 110 , which have been prepared on the going concern basis, were approved by the board of directors on28 July 2008 and were signed on its behalf by:Prof. WL NkhuluChairperson of the BoardMxolisi D MatshambaChief Executive Officer28 July 200869
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