Chapter 2 - P rogramme 1 - Department of Defence

| Department of Defence | Vote 20 |
DISCLOSURE NOTES TO THE ANNUAL FINANCIAL
STATEMENTS for the year ended 31 March 2008 (continued)
2007/08
R’000
311 Annual Report FY 2007 - 2008
2006/07
R’000
28.2 Irregular expenditure
Incident
Disciplinary steps taken/
criminal proceedings
Hiring of goods after expiry Disciplinary action taken against
of Government orders involved member
10 -
Procurement of rations
Disciplinary action taken against
involved member
44 -
Deviation from State
Contract - Air tickets
Disciplinary action taken against
involved member
1 -
Deviation from State
Contract - Tyres
Disciplinary action taken against
involved member
2 -
Possible fraudulent expenditure
- Boshof Commando
Involved members removed from
their posts and reprimanded
2 -
Total 59 -
29. Related party transactions
Armscor (Pty) Ltd, the Castle Control Board and the South African National Defence Force Fund
(SANDF Fund) are related parties to the Department of Defence through the Minister of Defence as
an intermediary. Armscor, the Castle Control Board, SANDF Fund and the Department of Defence
are controlled by the Minister of Defence.
29.1 Armscor (Pty) Ltd
Armscor (Pty) Ltd is mandated by the Armscor Act, Act 51 of 2003, to meet the defence material and
other related requirements of the Department.
The transactions between Armscor and the Department are mainly related to the sale and purchase of
armament.
29.2 Castle Control Board
The Castle Control Board is the board of the Cape Town Castle. The Board is appointed in terms of
the Castle Management Act, Act 207 of 1993 and its function is to control the Cape Town Castle.
The transactions between the Castle Control Board and the Department are mainly related to the
provision of personnel, offices and transport by the Department.
29.3 SANDF Fund
The SANDF Fund is established in terms of the Fund Raising Act, Act 107 of 1968. The aim of the
Fund is to render aid to SA National Defence Force and Auxiliary Services and their dependants who
suffer financial hardship and distress as a result of duties in terms of the Defence Act.
The transactions between the SANDF Fund and the Department are mainly related to the provision of
personnel, offices and transport by the Department.
29.4 Other related parties
Funds and Institutions such as the South African Forces Institute (SAFI), established in terms of the
General Regulations to the Defence Act, Act 42 of 2002.
The transactions between the Funds and Institutions are mainly related to the provision of personnel
and transport by the Department.
Related party transactions will be reported in the financial year 2008/09.
| Financial Performance |