Annual Report 2011/2012

Transcription

Contents
Submission to the Minister
2
Applicable Acts and Mandates
2
Foreword by the Head of the Institution
4
Statement of Responsibility
27
Report of the Audit and Governance Committee
28
Chairperson’s Report
30
Performance Information
34
Report of the Auditor-General
48
Annual Financial Statements
50
Human Resources
82
Glossary
85
Annual Report 2011-2012
1
SUBMISSION TO THE MINISTER
According to the terms of Public Finance Management Act, 1999 (Act No. 1 of 1999), it is our pleasure
to submit The Playhouse Company’s Annual Report for the financial year ended 31 March 2012.
APPLICABLE ACTS AND MANDATES
In terms of section 8 (5) of the Cultural Institutions Act, 1998 (Act No. 119 of 1998), the role of The
Playhouse Company is to advance, promote and preserve the performing arts in South Africa.
The Playhouse Company operates under various legal mandates, including:
• The Constitution of the Republic of South Africa
• The Public Finance Management Act, 1999 (Act No. 1 of 1999)
• The Cultural Institutions Act, 1998 (Act No. 119 of 1998)
• The Cultural Promotions Act, 1983 (Act No. 35 of 1983)
• The Treasury Regulations and Division of Revenue Act, 2001
• The Basic Conditions of Employment Act, 1997 (Act No. 75 of 1977)
• The Labour Relations Act, 1995 (Act No. 66 of 1995)
• The Occupational Health & Safety Act, 1993 (Act No. 85 of 1993)
• General Administration Regulations Act, 1983 (Act No. 6 of 1983)
2
The Playhouse Company
MISSION STATEMENT
The Playhouse Company’s mission is to advance, promote and preserve the performing arts. We aim
to be a company known for artistic integrity and excellence, catering for multi-cultural and diverse
audiences and their ever-changing needs.
VISION
Commitment to artistic integrity and excellence, catering for multi-cultural and diverse audiences and
their ever-changing needs.
The Playhouse Company has defined its critical success factors as follows:
Unique artistic works
•
To utilise the performing arts as an agent for social change.
To promote a sense of inter-cultural awareness and unity through the performing arts.
To present artistic works that reflect the diversity and the varied talents and heritage of South Africa.
To promote theatre as a place that educates and promotes critical thinking.
•
Making the arts accessible.
•
•
•
Positive profile
•
•
•
To become South Africa’s premier theatre destination.
To strategically position the institution among relevant stakeholders as a theatre of choice.
To sustain successful audience development campaigns which appeal to a wide variety of audiences.
Create a healthy organisation
•
•
•
Encompassing team spirit.
To sustain a system of pay/reward that is linked to staff development and productivity.
Transparency; to create an open, adaptable attitude that will encourage trust, earn respect and
build team spirit.
Promote excellence
•
•
•
•
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To present works of a diverse nature which are of the highest standard.
To promote excellence in The Playhouse Company’s delivery of all its functions and appearance.
Professionalism should be the key factor in all aspects of our work.
To be a hallmark of success for an artist.
Optimise the use of our performance venues by presenting productions of high quality which meet
the needs of various audiences.
Engender a sense of belonging
•
•
To be a place where stakeholders feel they belong.
To promote an environment that is caring towards people, an environment of trust and empowerment,
accountability and openness.
Compliance
•
To ensure compliance with all relevant statutes and regulations.
•
To promote best practices in financial controls and governance within the company.
To ensure appropriate maintenance of physical buildings and equipment.
•
3
FOREWORD BY THE HEAD OF
THE INSTITUTION,
LINDA BUKHOSINI
We are pleased to present the annual report and
financial statements of The Playhouse Company for
the fiscal year ending 31 March 2012. This report
highlights various aspects of the significant work we
are doing in serving our diverse communities.
One of the memorable production highlights is
the partnership with the South African Sports
Confederation and Olympic Committee in staging
the opening ceremony of the 123rd International
Olympic Committee’s (IOC) Session. This production
received unprecedented television coverage, and
was attended by an invited audience that included our
State President, mr Jacob Zuma, who hosted other
heads of state, the IOC President, mr Jacques Rogge, cabinet ministers and eminent
sporting personalities from around the world. It was a singular honour for The Playhouse
Company to be associated with this historic event, the first in the African continent.
Another outstanding partnership was with the Department of International Relations and
Cooperation, where The Playhouse Company was commissioned to produce a series
of productions during the 17th Conference of the Parties (COP17) to the United Nations
Framework Convention on Climate Change.
The Playhouse Company is proud to achieve an unqualified audit report for the sixth
consecutive year. This achievement bears testimony to our Council’s strong leadership,
and the commitment from the management team and staff in continuing to ensure that
our institution maintains good governance practices.
We trust that in reading this report you too will gain insight into our business and be
touched by the enormous talent and skills that continuously and positively impact the
communities that we serve.
4
PRODUCTION SUMMARY
TYPE
ARTISTS
PRODUCTIONS
AUDIENCES
PERFORMANCES
In-house
3 859
49
114 156
179
In-Association
2 936
12
43 881
105
244
7
70 020
10
Outside Hirers
2 915
39
32 952
102
TOTAL
9 954
107
261 009
396
Mobile Stage
A TRIBUTE T0 THE JAZZ LEGENDS
5
In-House ProductIons
Produced by The Playhouse Company
Productions
Performances
Artists
Employed
Audience
COMMUNITY ARTS FESTIVAL – Just Don't
5
6
853
COMMUNITY ARTS FESTIVAL – Rice
4
2
365
COMMUNITY ARTS FESTIVAL – Sisenga Ilala
4
7
342
IOC Opening Ceremony
1
178
1 200
Arts Network Forum
2
11
40
NEW STAGES – For Generations
2
1
197
NEW STAGES – Race
7
4
1 330
NEW STAGES – Mein Soldat
2
2
207
SA WOMEN’S ARTS FESTIVAL – Open Mic Poetry
1
8
450
SA WOMEN’S ARTS FESTIVAL – Inter-generational Dialogue
1
6
450
SA WOMEN’S ARTS FESTIVAL – Gospel Concert
1
50
772
SA WOMEN’S ARTS FESTIVAL – Threads
3
7
664
SA WOMEN’S ARTS FESTIVAL* – Shika-Land!
3
2
155
SA WOMEN’S ARTS FESTIVAL* – Winds of Change
1
81
656
22
6
2 760
Iscathamiya Competition
1
2 554
1 537
COP17 Opening Ceremony
1
31
5 000
COP17 Civic Reception
1
58
1 700
COP17 High Level Ministerial Dinner
1
18
250
32
108
21 104
FESTIVE SEASON – Just for You
6
12
600
FESTIVE SEASON – A Tribute to the Jazz Legends
1
98
465
Sundowner Concerts
14
118
1 935
SCHOOLS – Just Don't Tour
52
6
67 804
Test Driving the Arts
11
485
3 320
179
3 859
114 156
SA WOMEN’S ARTS FESTIVAL* – The Coolie Odyssey
FESTIVE SEASON – Cinderella
TOTAL: 49 productions
* Presented in association with The Playhouse Company.
6
COMMUNITY ARTS FESTIVAL
SISENGA ILALA
Synopsis: This production is set in a small village court. It depicts
life in this community where peace and reconciliation is
achieved after various conflicts have been experienced.
Date: 19-21 May
Artists: 7
Audience: 342
Performances: 4
JUST DON’T
Synopsis: A group of prisoners follow the journey of Jesu, a young
boy from a well-off family, who committed a petty crime,
stealing a cell phone as a birthday gift for his girlfriend.
He landed in jail where he was raped by prison gangsters.
Fighting for his life, he ended up paralysed and HIV
positive. The cast includes six members, some of whom
have had personal experiences of life in jail.
Date: 5-7 May
Artists: 6
Audience: 853
Performances: 5
RICE
Synopsis: Rice reflected the story of two brothers who tragically
lose their parents in a fatal car accident. Things get
tough as their trusted aunt turns against them and
when Karabo, the older brother, loses his job. This play
depicts their struggle for survival.
Date: 12-14 May
Artists: 2
Audience: 365
Performances: 4
Production: RACE
7
SOUTH AFRICAN WOMEN’S ARTS FESTIVAL
THREADS
Synopsis: Threads is a cross cultural and cross generational artistic
collaboration between legendary choreographer and cultural
activist, Ms Sylvia “Magogo” Glasser, and Lebo Mashile, one
of South Africa’s celebrated young literary voices. Threads
deals with issues of gender relationships and cultural
identities. This work has been described as a verbal dance
and a physical poem piece.
Date: 12 and 13 August
Artists: 7
Audience: 664
Performances: 3
THE COOLIE ODYSSEY
Synopsis: Rajesh Gopie’s production looked at the lives of indentured
workers from India, who arrived in Natal to work on the sugar
plantations. The Coolie Odyssey was presented as a special
event to commemorate the 150th anniversary of the arrival of
Indians in South Africa.
Date: 14 July-7 August
Artists: 6
Audience: 2 760
Performances: 22
SHIKA-lAnd
Synopsis: Shika-land is a one woman show which delves into the
lives of five different women, played by Shika Budhoo.
Interspersed with song, intimate encounters give insight
into arranged marriage, single motherhood, woman abuse,
infidelity and scandal, while posing the question “does our
name fit our character or does our character fit our name”?
These women’s stories took us on a rollercoaster of emotion,
shedding tears one moment, and roaring with laughter the
next.
Date: 5-7 August
Artists: 2
Audience: 155
Performances: 3
THREADS
8
THE COOLIE ODYSSEY
WINDS OF CHANGE
Synopsis: Winds of Change is staged in aid of Dance for a Cure. Since
2007, the organisation has staged gala concerts to raise
funds for the vaccination of orphaned girls against cervical
cancer.
Date: 5 August
Artists: 81
Audience: 656
Performances: 1
9
TRADITIONAL ARTS FESTIVAL
SISHAYINGOMA ZULU DANCE COMPETITION
Synopsis: This annual Zulu dance competition was held at Emsinga
Sports Ground in Umzinyathi district, and featured the
best Zulu dance groups from around KwaZulu-Natal in the
following categories: Isigekle, Ushameni, Indlamu, Ingoma
skhuze, Ingoma Yezinsizwa and Ingoma Yezintombi.
Date: 17 September
Artists: 2 500
Audience: 6 000
Performances: 1
Venue: Mobile Stage
ISCATHAMIYA COMPETITION
Synopsis: The 14th event in this highly popular series, the Iscathamiya
Festival saw well over 100 groups converging on our main
stage, keenly competing for coveted prizes as they pitted their
skills against their peers. Besides the acapella singing and
dancing that comprise this much-loved art form made world
famous by the Grammy Award-winning group, Ladysmith
Black Mambazo, the Festival featured the popular Oswenka
and Onobuhle sections, in which 25 men and 25 women
displayed their sense of style and fashion during interludes
interspersed between the competition’s mainstream events.
Date: 24 September
Artists: 2 554
Audience: 1 537
Performances: 1
OPENING CEREMONY OF THE 123RD INTERNATIONAL
OLYMPIC COMMITTEE’S SESSION
Synopsis: The South African Sports Confederation and Olympic
Committee commissioned The Playhouse Company to
produce the opening ceremony of the 123rd International
Olympic Committee’s (IOC) Session, which was televised
live and attended by significant international and local
dignitaries, including our State President, the IOC President,
heads of state, various eminent sporting personalities and
cabinet members. The production garnered a standing
ovation and glowing accolades for our country.
Date: 5 July 2011
Artists: 178
Audience: 1 200
Performances: 1
10
COP17
OPENING CEREMONY
Synopsis: The Department of International Relations and Co-operation
commissioned The Playhouse Company to produce a series of
productions for COP17. The Playhouse Company coordinated
various artistic activities during the opening address at the Albert
Luthuli International Convention Centre.
Date: 28 November
Artists: 31
Audience: 5 000
Performances: 1
CIVIC RECEPTION
Synopsis: Also as part of COP17, a fusion of traditional Indian and Zulu
dance and a Maskandi performance was staged at the Durban
City Hall. This captivated local and international delegates.
Date: 28 November
Artists: 58
Audience: 1 700
Performances: 1
HIGH MINISTERIAL DINNER
Synopsis: A Ministerial Dinner was held to conclude the COP17 activities.
Distinguished guests were treated to performances by the cream of
South Africa’s musical talent, including Madala Kunene, a veteran
of traditional Zulu folk music, Thandiswa Mazwai, popular awardwinning Afro pop singer, and Ladysmith Black Mambazo, the
internationally acclaimed and Grammy Award winning Iscathamiya
group led by Mshengu Shabalala.
Date: 7 December
Artists: 18
Audience: 250
Performances: 1
11
NEW STAGES
FOR GENERATIONS
Synopsis: Kurt Engelhof’s one-hander was a powerfully-enacted
personal retrospective, seen through the eyes of the author’s
grandfather and father. He also shared his own poignant
milestones and moved into the future with his son Aston,
who, at fifteen, was part of the post-apartheid generation
learning about his country’s shameful history through school
books.
Date: 7 and 8 October
Artists: 1
Audience: 197
Performances: 2
RACE
Synopsis: The Pulitzer Prize-winning playwright David Mamet’s play,
Race, was staged in our theatre straight after its debut
season on Broadway. Three lawyers: two partners, one
African-American, one White, and their young, AfricanAmerican law clerk are deciding whether to take the case of
a wealthy white man accused of raping an African-American
woman. The play, like the case, has many twists and turns.
Shame, guilt, class, sex, lies and, of course, race, were all
provocatively stirred together in this fast-paced production
that left theatergoers dissecting and discussing it long after
the curtain went down.
Date: 14-22 October
Artists: 4
Audience: 1 330
Performances: 7
MEIN SOLDAT
Synopsis: Mein Soldat (My Soldier) is an exhilarating reminder of
the power of silence in the theatre space, highlighting the
singular beauty and economy of placing and intricate detail.
Set during World War II, the play documented the complex
relationship between two strangers who found each other
through forced circumstances. The play featured Janna
Ramos-Violante and Clinton Small.
Date: 21 and 22 October
Artists: 4
Audience: 207
Performances: 2
12
RACE
13
FESTIVE SEASON
CINDERELLA
Synopsis: This was the first-ever production of the large scale Rodgers
and Hammerstein’s magical musical Cinderella to be staged
anywhere in Africa. With music by Richard Rodgers, lyrics
by Oscar Hammerstein II, and adapted for the stage by Tom
Briggs from the teleplay by Robert L. Freedman, this classic
rags to riches tale is about a young woman (Nondumiso
Tembe) forced into a life of servitude by her cruel stepmother
(Lisa Bobbert) and self-centered stepsisters (Clare Mortimer
and Krystle Temmerman) who dreams of a better life. With the
help of her fairy godmother, Cinderella was transformed into a
Princess and found her Prince. Featuring live accompaniment
by the KZNPO, this international production for the whole
family featured Ralph Lawson as Director, Set and Costumes
by Keith Anderson, and Choreography by David Gouldie.
Date: 26 November - 31 December
Artists: 108
Audience: 21 104
Performances: 32
JUST FOR YOU
Synopsis: Written and directed by Thami Sikhosana, Just for You was
a moving musical that depicted the lives of those who left
their homes and loved ones and migrated to the city. The play
depicts their struggle to survive tough urban living conditions,
their relationships, deceptions, dreams and disappointments.
In keeping with the festive season’s spirit of hope and goodwill,
the play ended on an up-beat note, with a final, life-changing
stroke of luck that showed how friendship endures through
bad and good times.
Date: 11-17 December
Artists: 12
Audience: 600
Performances: 6
A TRIBUTE TO THE JAZZ LEGENDS
Synopsis: Starring all-time master of the genre, the legendary Hugh
Masekela, supported by Durban’s popular jazz personalities,
Patti Nokwe and Theo Bhopela, and with South Africa’s swiftlyrising jazz talent, Siphokazi, who added her own special lustre
to the line-up, A Tribute to the Jazz Legends also featured the
KwaZulu-Natal Philharmonic Orchestra and the Playhouse
tap dancers.
Date: 18 December
Artists: 98
Audience: 465
Performances: 1
14
CINDERELLA
15
MOBILE STAGE
Arts groups and municipalities hire and make use of The Playhouse Company’s mobile stage to mount
medium scale productions, concerts, public awareness campaigns etc. The mobile stage offers immediate,
accessible sound equipment and technical services, especially in rural and township settings. Rentals are
kept to a minimum, making it an affordable option for its varied users. The mobile stage is well equipped and
largely used to tour our productions to schools mainly in rural and township communities.
Production
Performances
Artists
Employed
5
5
6 020
n/a
n/a
n/a
KZN DAC
1
72
8 000
Comrades Marathon
1
6
1 000
Mandela Day
1
45
2 500
Isolezwe on Saturday Promotion
1
22
2 500
Umkhosi Womhlanga (Royal Reed Dance)
1
94
50 000
10
244
70 020
Abstinence Walk Tour KZN
KZN Music House
TOTAL: 7 productions
16
Audience
JUST DON’T
17
In-AssocIAtIon
The Playhouse Company uses opportunities to collaborate with various arts companies and producers. This
acts as another stream of income generation at box office in addition to grants received from various levels
of government.
Production
Performances
Artists Employed
Audience
The Durban Passion Play
26
117
8 617
Abnormal Loads
19
11
2 679
Book Launch – Women: South Africans of Indian
Origin
1
2
350
A New Day
1
16
320
Izimbongi Zenkululeko
2
20
115
Mandela Trilogy
3
124
2 322
Sishayingoma (Ingoma Competition)
1
2 500
6 000
Shall We Dance
9
94
8 141
Dance like a Man
4
4
656
Rhythm Divine
3
10
1 136
Welcome to South Africa
6
25
365
30
13
13 180
105
2 936
43 881
Othello
TOTAL – 12 productions
18
THE DURBAN PASSION PLAY
Synopsis: Presented in partnership with the Durban Catholic Players
Guild, the Durban Passion Play depicts Jesus Christ’s last days
on earth based on the Biblical Gospels that the Oberammergau
script is based on. The first Passion Play in Durban was
performed in 1952 when the Mayor and community of
Oberammergau in Bavaria granted special permission to the
Durban Catholic Players Guild to stage an abridged version of
their world famous Passion Play. It has been staged every five
years for 59 years.
Date: 1-24 April
Artists: 117
Audience: 8 617
Performances: 26
Venue: Drama Theatre
BOOK lAunCH – WOMEn: SOuTH AFRICAnS OF
INDIAN ORIGIN
Synopsis: The Consulate General of India in Durban partnered with the
Playhouse to launch the book Women: South Africans of Indian
Origin by Devi Moodley Rajab, with photographs by Ranjith Kally.
Featuring profiles by the award-winning academic columnist
Rajab and portraits by the iconic South African photographer
Kally, the book steps into a critical gap in our understanding of
our evolution into a society united in its diversity. A stage play
based on this book is being developed.
Date: 5 May
Artists: 2
Audience: 350
Performances: 1
IZIMBONGI ZENKULULEKO
Synopsis: This production was an open invitation to poets from schools
and various artists in Durban to let their voices be heard on a
professional stage.
Date: 24 June and 29 July
Artists: 10
Audience: 115
Performances: 2
SHIKA-LAND
19
MANDELA TRILOGY
Synopsis: Mandela Trilogy is a home-grown opera featuring an entirely
South African 40-member cast and multiple award winning
singer and recording artist, Gloria Bosman in the leading
role. This production was a beautiful collaboration between
The Playhouse Company and Cape Town Opera.
Date: 29-31 July
Artists: 124
Audience: 2 322
Performances: 3
Venue: Opera Theatre
SHALL WE DANCE
Synopsis: Presented by The Playhouse Company in association with
the South African Dance Teachers’ Association, it was
directed by tireless dance activists, Neville Letard and Caryl
Cusens. There were dancers from the Young Dancers
Project from the Minnette de Klerk Academy, Dance Basics,
the Razmatazz Dancers, Mark Wilson Dance Academy,
Neville Letard Dance School and Static.
Date: 9-17 September
Artists: 94
Audience: 8 141
Performances: 9
Venue: Opera Theatre
JUST FOR YOU
20
DANCE LIKE A MAN
21
DANCE LIKE A MAN
Synopsis: This production was presented in association with Teamworks
Productions from India. Dance Like a Man focused on the
story of Jairaj and Ratna, two Bharat Natyam dancers past
their prime, contrasted with that of their daughter Lata, who
was on the brink of establishing herself as a brilliant dancer.
Her imminent success created tension and jealousy, and
the audience was drawn into the dark secrets of family
relationships and conflicts between generations.
Artists: 4
Audience: 656
Performances: 4
RHYTHM DIVINE
Synopsis: Rhythm Divine is a seamless blend of the avant-garde with
traditional movement. Throughout the first two segments, a
dedicatory quality was pervasive, offering everything to a
higher realm; qualities of reverence and spirituality that were
part of the Pung Cholam tradition of Manipur. The segments
flowed with a perceptive choreographic logic from the slow
and devotional to staccato beats and martial movements.
Artists: 10
Audience: 1 136
Performances: 3
WELCOME TO SOUTH AFRICA
Synopsis: The show depicts various achievements of ordinary South
Africans.
Date: 26-29 October
Artists: 25
Audience: 365
Performances: 6
Venue: Loft Theatre
22
MANDELA TRILOGY
23
THE DURBAN PASSION PLAY
OTHELLO
Synopsis: Geared mainly for high school learners studying
Shakespeare’s stage tragedy as a set work, the production
was directed by award-winning actress Clare Mortimer,
herself an accomplished writer and an experienced English
teacher. Othello featured Farai Gwaze in the title role, playing
opposite Karen Logan as Desdemona and Iain ‘Ewok’
Robinson as Iago, with Libby Allen taking the role of his wife,
Emilia.
Date: 14 February - 9 March
Artists: 6
Audience: 13 180
Performances: 31
ABNORMAL LOADS
Synopsis: Abnormal Loads is a lyrical praise-poem to the province of
KZN and its myriad of characters and cultures. An insightful
reflection on the many complexities and contradictions of life
in a small town in South Africa. Written and designed by Neil
Coppen, the production was directed by Neil Coppen and
Jana Ramos Violante.
Artists: 11
Audience: 2 679
Performances: 19
Venue: Loft Theatre
24
ISCATHAMIYA COMPETITION
25
OUTSIDE HIRERS
The Playhouse Company offers its theatre venues for hire at very competitive rates.
Production
KZN Music House Celebration Concert
Performances
Artists
Audience
1
43
1 050
10
1
673
Krish Swamivel's Dance Climax 2011
1
150
774
Anup Jalota – Live in Concert
1
8
1 019
Caltex Iscathamiya High School Competition
1
850
1 210
Voices for the Village
1
144
1 200
Unlimited Empowerment Awards
1
2
450
KZNPO Winter Season Gala Concert
1
70
500
SASCE Workshop
1
9
120
Marc Lottering: Not in 3D
2
1
920
Imperial Russian Ballet’s The Nutcracker
1
41
1 223
RMB Private Bank’s Legacy of Broadway
1
130
350
Ballet Africa’s KZN Dance Centre
2
120
816
IFBB KZN Bodybuilders Championships
2
83
1 398
RAD Genee Dance Challenge
1
23
112
Dr Nala Tehilla Song
1
110
1 204
KZNPO Young Performers
1
83
381
COSATU Meeting
1
6
1 200
Umkhosi Wezinkondlo Zama-Afrika
1
8
235
1
34
120
Fusion Fantasia
2
80
635
Durban Music School 10th Anniversary Concert
1
237
1 224
Stars of the Ballet Moscow
2
15
1 644
Last Night of the Proms
1
254
1 056
Zulu Comedy Corner
1
10
1 220
Original Material Awards
1
70
463
1
7
120
The 2011 D&C Dance Awards
1
37
245
Sitting around the fire
9
4
824
Mummenschanz
6
4
2 306
Belly of the Beast
11
3
382
No Swearing
2
3
759
uThembalethu
6
2
276
Charous in Denial
3
9
718
Thoroughly Modern Millie
7
58
1 243
Red
7
2
456
Dancing Pencils
1
163
468
Don Quixote
7
39
3 830
A Plague of Heroes
iThemba-Tattu
TOTAL – 39 productions
26
1
2
128
102
2 915
32 952
THE PLAYHOUSE COMPANY
for the year ended 31 March 2012
STATEMENT OF RESPONSIBILITY BY
CHAIRPERSON OF COUNCIL
The Public Finance Management Act, 1999 (Act No. 1 of 1999),
as amended, requires the Council to ensure that The Playhouse
Company keeps full and proper records of its financial affairs. The
annual financial statements should fairly present the state of affairs of
The Playhouse Company, its financial results, its performance against
predetermined objectives and its financial position at the end of the
year in terms of the prescribed Standards of Generally Recognised
Accounting Practices (GRAP) issued by the Accounting Standards
Board.
The Playhouse Company, a public cultural institution, acknowledges that the annual financial statements
are the responsibility of the Council. The External Auditors are responsible for independently auditing
and reporting on the financial statements.
The Council has reviewed The Playhouse Company’s budgets and cash flow forecasts for the year
ended 31 March 2012. On the basis of this review, and in view of the current financial position, the
Council has every reason to believe, and the auditors concur, that The Playhouse Company will be a
going concern in the year ahead and has continued to adopt the going concern basis in preparing the
annual financial statements.
To enable the Council to meet the above responsibilities, the Council puts policies in place in order to
ensure that The Playhouse Company has and maintains an effective, efficient and transparent system
for financial, risk management and internal controls that are designed to provide reasonable, but not
absolute assurance against material misstatements and losses. The Playhouse Company maintains
internal financial controls to provide assurance regarding:
•
•
The safeguarding of assets against unauthorised use or disposition.
The maintenance of proper accounting records and the reliability of financial information used
within the company or for publication.
In the opinion of the Council, based on the information available to date, the annual financial statements
fairly present the financial position of The Playhouse Company as at 31 March 2012 and the results of
its operations and cash flow information for the year ended.
The annual financial statements set on pages 50 to 81 were approved as a draft on 18 May 2012,
subject to approval by Council at a later date, and submitted to the Auditor-General for auditing on the
31 May 2012 in terms of section 55 (1) (c) of the Public Finance Management Act as amended.
The annual financial statements were subsequently approved in a Council meeting on 27 July 2012
and are signed on their behalf by:
MS THANDIWE JANUARY-MCLEAN
Chairperson of Council
27
REPORT OF THE AUDIT AND
GOVERNANCE COMMITTEE
The Audit and Governance Committee, ‘the Committee’, presents its report for the financial year ended 31
March 2012.
AUDIT COMMITTEE MEMBERS AND ATTENDANCE
The Committee consists of the members listed below and is required to meet at least four times per year as
per its approved terms of reference. During the current year five meetings were held.
Committee ending 31 July
New Committee
L Theron
2
S Naidoo
2
M Rajab
2
S Gounden
2
T Shezi
1
M Mvulane #*
2
M Mvulane #*
1
C Jugnarayan #
2
S Sibisi #
1
B Mngoma #
1
R Ashe #
1
Notes:
#*Chairperson
# External Member
AUDIT COMMITTEE RESPONSIBILITY
The Committee reports that it has complied with its responsibilities arising from Section 38 (1)(a) of the
Public Finance Management Act 1 of 1999 and Treasury Regulation 3.1. The Committee also reports that
it has adopted appropriate formal terms of reference as its Audit and Governance Committee Charter, has
regulated its affairs in compliance with this Charter, and has attempted to discharge its responsibilities as
contained therein. The charter is reviewed annually and adopted by the Committee on approval by the
Accounting Authority.
INTERNAL AUDIT
The committee co-ordinates and monitors the activities of the internal audit function. Through this, the
Committee is able to report on the effectiveness of internal audit. The internal audit function was outsourced
and operational for the financial year.
The Committee considered the updated risk register based on the risk management framework and policy
adopted by the Accounting Authority. The Committee reviewed and approved the risk based three year
rolling internal audit plan.
The Committee is satisfied with the effectiveness of the internal audit function and is satisfied that the
internal audit function has addressed the risks pertinent to the Company in its audits.
EFFECTIVENESS OF INTERNAL CONTROL
The Committee assessed the effectiveness of the internal controls and reviewed the risk assessment
processes, which it performed as follows:
•
Considered the effectiveness of the company risk assessment processes;
•
Monitored progress on the follow up of all findings by the auditors;
•
Sought assurances from management that action is being taken on risk-related issues identified by auditors;
28
•
Provided guidance and advice to Management and the Accounting Authority on strengthening controls
over risk management processes and performance information.
The Committee reviewed the internal audit reports, weaknesses identified within the company and considered
the adequacy of management responses to ensure the risks exposure is reduced and there is continuous
improvement within the control environment.
The Committee is satisfied that the Company is continually focused on maintaining effective levels of internal
control and after review of the reports and discussions with the auditors, the Committee concurs with auditors
that internal controls were reasonably effective and reliable and any matters reported by internal auditors
during the year did not indicate any significant or material deficiencies.
The administration of monthly/quarterly reports submitted in terms of the PFMA and Division of Revenue Act
was satisfactory according to monitoring and internal audit results.
EVALUATION OF FINANCIAL STATEMENTS
The Committee has:
•
Reviewed the quarterly reports including financial statements to ensure consistency and accuracy of
information;
•
Considered the appropriateness, adoption and consistent application of the South African Statement of
Generally Recognised Accounting Practices adopted by the Council;
•
Considered the quality and timeliness of the financial information availed to the Committee for oversight
purposes during the year;
•
Reviewed the financial statements of the Company for the year ended 31 March 2012 and is satisfied
that they comply with relevant provisions of the Public Finance Management Act and the South African
Statement of Generally Recognised Accounting Practices;
•
Reviewed the Auditor-General’s management report and management’s response thereto;
•
Reviewed the Auditor-General’s Audit Report and noted that there were no findings in financial
statements and performance information.
The Committee is pleased to report that the Company has received an unqualified audit report. The
Committee concurs and accepts the conclusion of the Auditor-General on the annual financial statements
and hence the Committee is of the opinion that the audited annual financial statements be accepted and
read together with the report of the Auditor-General.
The Committee takes this opportunity to congratulate the Council and Management for their countless efforts
and commitments in obtaining an unqualified audit report from the Auditor-General for six consecutive years
and would like to express gratitude for their support and fruitful discussions with the Committee.
PMK MVULANE CA (SA), RA
Chairperson: Audit and Governance Committee
29
CHAIRPERSON’S REPORT
I am pleased to present our Annual Report as the Chairperson of the Council of The Playhouse Company
for the financial year ended 31 March 2012
NATURE OF OPERATIONS
The Playhouse Company is a Public Cultural Institution, which was declared as such by the Minister with
effect from 1 April 2003 in terms of Sections 3 & 4 (8) of the Cultural Institutions Act 1998. Previously, The
Playhouse Company existed as a non-profit organisation incorporated under Section 21 of the Companies
Act, 1973. The Board of Directors passed a resolution that The Playhouse Company cease to exist as a
Section 21 company and its assets and liabilities devolve upon the new institution in accordance with the
Minister having declared The Playhouse Company a Cultural Institution.
MISSION STATEMENT
The Playhouse Company’s mission is to advance, promote and preserve the performing arts. We aim to be
a company known for artistic integrity and excellence, catering for multi-cultural and diverse audiences and
their ever changing needs.
The Playhouse Company will aim to achieve its mission by:
•
Presenting productions that reflect artistic talents, the diversity and the varied heritage of South Africa;
•
Promoting theatre as a place that educates and promotes critical thinking;
•
Utilising the arts as a medium for social change;
•
Promoting a sense of inter-cultural awareness, moral regeneration, social cohesion and nation building;
•
Facilitating equity in our artistic programming;
•
Entrenching national and civic pride through the use of the arts;
•
Promoting excellence in The Playhouse Company’s delivery of all its function and appearance.
REVIEW OF OPERATIONS
The Playhouse Company, in line with its mission and objectives continues to give a platform to the artists to
showcase their talent. In the year under review a number of internal and external productions were staged at
the Playhouse theatres. Our artistic plan consisted of internally produced shows, which were complimented
with numerous productions by external producers. The number of performances during the period amounted
to 396. In addition a mobile stage is used for performances primarily in the province of KwaZulu-Natal.
FINANCIAL PERFORMANCE
Revenue
Total revenue increased by 21% from R67m to R81m.
•
The increase is mainly attributable to the capital grant received from the Department of Arts and Culture
to fund the capital projects.
•
A sponsorship income of R1.7m was received from the South African Sports Confederation and
Olympic Committee (SASCOC) for the staging of the International Olympic Committee event whilst a
sponsorship of R0.7m was received from the Department of International Relations and Cooperation –
Republic of South Africa (DIRCO) for the staging of the COP17 event.
Operating expenses
Operating expenses increased by 33% from R45m to R60m.
•
The production costs increased by 68% from R8.5m to R14.3m. This was largely due to the Cultural Institution
presenting a major year-end production. In the prior year the Cultural Institution strategically partnered itself
with established production houses to present in-association productions and that explains the low cost.
•
Other operating expenditure increased by 35% from R17m to R23m. This was largely due to an increase
30
in maintenance and security by 15% from R3.9m to R4.5m and an increase of 88% in depreciation from
R4.3m to R8.1m.
Surplus for the year
The surplus for the year is R24.8m. The net operating surplus was arrived at after recognising the capital
grant of R26m (refer note 10) as grant income in the period the conditions of the grant were met as per the
GRAP statement. The surplus is committed to capital and operational expenditure that will be completed in
the new financial year.
FINANCIAL POSITION
The Playhouse Company reflected a positive financial position at year end.
•
The increase in non-current assets by R9m is primarily due to capital projects completed during the
year, with the major contributor being the dimmers replacement in the theatres.
•
Current assets increased by R16m and this was primarily as a result of cash and cash equivalents
increasing by R13m. Funds received in the latter part of the financial year for capital projects were only
disbursed in the new financial year when the projects were completed. An accrual of R3m was made for
the eThekwini grant that was approved in the post balance sheet period.
•
Current liabilities declined by R0.5m.
CASH FLOWS
Cash and cash equivalents increased by R13m from R55m to R68m. Funds received in the latter part of
the financial year for capital projects were only disbursed in the new financial year when the projects were
completed.
CORPORATE GOVERNANCE ARRANGEMENTS
Council
The new Council was appointed by the Honourable Minister of Arts and Culture, Mr S P Mashatile, on
1 August 2011. The table below depicts the current councilors at year-end and as at the date of this report.
It also shows their attendance at meetings, committees in which they belong, and date of resignation if
applicable. All fees and allowances paid for the 2011/12 financial year to Council members are reflected in
notes to the annual financial statements, which forms part of this annual report. The Councils office term
ends on 31 July 2014.
NAME
COUNCIL
MEETINGS
FINCO
AUDIT AND
GOVERNANCE
HR REMCO
TOTAL
M Lesoma*
2
2
J Shabalala
0
0
L Theron**
2
M Rajab***
2
2
2
6
R Ashe
1
2
1
4
T Ngcobo
1
1
T Shezi
1
T Thabethe
2
TOTAL
11
2
1
2
2
1
5
5
6
1
3
2
24
Notes:
*Chairperson of Council – Ms M Lesoma
** Chairperson of HR/REMCO – Judge L Theron
***Chairperson of FINCO – Mr M Rajab
31
Details of the new Council meeting attendance:
NAME
COUNCIL
MEETINGS
FINCO
AUDIT AND
GOVERNANCE
HR REMCO
ADHOC
MEETINGS
3
T January-McLean *
2
L Theron **
3
M Mlambo
5
2
7
M Rajab
5
3
8
N Nala
5
R Ashe
5
Sadha Naidoo
4
Sathie Gounden
5
Suresh Naidoo***
5
T Ngcobo
4
T Shezi
3
TOTAL
46
1
TOTAL
3
3
1
6
1
2
11
2
2
2
3
1
9
1
8
1
9
4
11
5
2
1
6
7
5
65
Notes:
*Chairperson of Council – Ms T JanuaryMcLean
**Deputy Chairperson of Council and Chairperson of HR/REMCO – Judge L Theron
***Chairperson of FINCO – Mr Suresh Naidoo
MANAGEMENT
As at financial year-end, the following senior management posts in The Company were filled. The current
senior management structure is as follows:
•
Ms. Linda Bukhosini – Chief Executive Officer
•
Mr. Amar Mohanparasadh – Chief Financial Officer
•
Mr. Oscar Hlangu – Support Services Manager
INTERNAL CONTROL SYSTEM
The Playhouse Company maintains systems of internal control over financial reporting and the safeguarding
of assets against unauthorised acquisition, use or disposition of such assets. Such systems are designed to
provide reasonable assurance to The Playhouse Company regarding the preparation of reliable published
financial statements and the safeguarding of The Playhouse Company’s assets. Corrective actions are taken
to address control deficiencies and other opportunities for improving the systems when identified. Currently
the Company has an Audit and Governance Committee that is responsible for providing oversight of the
financial reporting process and the Internal Audit process.
There are inherent limitations in the effectiveness of any system of internal control, including the possibility
of human error and the circumvention or overriding of controls. Accordingly, even an effective internal
control system can provide only reasonable assurance with respect to financial statement preparation and
the safeguarding of assets. Furthermore, the effectiveness of an internal control system can change with
circumstances and events.
2011/12 AUDIT REPORT
I am happy to announce that we have received an unqualified audit report for the 2011/12 financial year.
This is the culmination of the hard work put in by Council and management over the years in ensuring that
there are adequate systems and policies in place to effect compliance with relevant financial and other
32
legislation governing the entity. This unqualified report sets a strong foundation on which we can only build
on and also provides a strong sense of confidence for our important stakeholders regarding proper financial
management of The Playhouse Company.
MATERIALITY FRAMEWORK
The Council has determined its framework of acceptable levels of materiality and significance, in conjunction
with the external auditors, as follows
•
Revenue and Expenditure – 1%
•
Assets and liabilities – 3%
Materiality is calculated against the above framework, however, there are instances where the situation may
warrant a more stringent materiality level and the level is adjusted accordingly.
A conservative approach is otherwise used in determining these levels of materiality.
MS THANDIWE JANUARY-MCLEAN
Chairperson: The Playhouse Company Council
33
PERFORMANCE INFORMATION
2011-2012 STRATEGIC OBJECTIVES
Strategic objectives/outcomes Actions to support strategic objectives
Measurable and evidence based
performance indicators 2011-12
1. To produce and present
professional and
developmental productions.
Develop an Annual Arts Plan that
includes both professional and
developmental productions.
Finalized Annual Arts Plan in place by 28
February.
2. To provide effective
and efficient financial
administration and
corporate governance.
Full compliance with the legislation as
per the legislative mandate and ensure
that controls implemented are aligned
to the resources available.
Unqualified Audit Report at 31 March.
Action audit findings within three months after
the report.
PFMA/ National Treasury compliance
checklist completed quarterly.
Produce quarterly Strategic plan reports.
3. To effectively support
and service the human
resources requirements of
the organisation.
To resource the organisation with
competent employees in line with the
manpower plan.
Vacancies filled with suitably qualified
personnel within three months of the vacancy.
To provide skills training that will ensure
a highly skilled workforce.
70% of the training plan is implemented by 31
March annually.
To assist line management in the
implementation of the performance
management system.
Performance agreements are drawn by 31
March and conduct bi-annual performance
assessments.
4. To provide functional,
efficient and safe asset
management.
Compile a comprehensive
infrastructural support and safety plan.
Comprehensive infrastructural support and
safety plan in place by 1 February of each
year and monthly progress reporting.
5. To optimise the institution’s
revenue streams.
Collate and align infrastructural funding
resources and institutional needs from
various stream into the annual budget.
Finalized budget incorporating funding
streams by 28 February.
34
Actual Performance versus measurable and evidence based performance indicators for the year ended 31 March 2012
Has the objective been
met? (Yes/No)
If yes, what has been achieved?
Yes
The Annual Arts Plan was finalised by 28 February 2011.
Yes
An unqualified clean audit report was received for the year
ended 31 March 2011.
Yes
The two audit findings were resolved within 3 months.
Yes
The compliance checklists were completed quarterly.
Yes
The strategic plan reports were produced quarterly.
Yes
All vacancies were filled with suitably qualified personnel
timeously.
Yes
96% of the training budget was implemented by 31 March.
Yes
The performance agreements were drawn up by 31 March.
The first half yearly reviews were completed in Sept 2011
and the second was done in April 2012.
Yes
Support and safety plans were approved by 1 February
2011. Progress was reported on at the management
meetings.
Yes
The finalised budget incorporating the funding streams was
approved by Council by 28 February 2011.
If no, why has the objective
not been met and what is
the remedial action?
35
1. ARTS AND TECHNICAL SERVICES OPERATIONAL PLAN
Strategic objectives/outcomes
Actions to support
strategic objectives
performance indicators 2011-12
1.
Develop an Annual Arts
Programme (AAP).
Finalized Annual Arts Programme
by 28 February, it will include the
following:
Implement the AAP by 31
March annually
a) Indigenous performing arts
(Iscathamiya - 1 production)
1
b) New Stages (min 3 productions)
3
c) SA Women’s Arts Festival (min 4
productions)
4
d) Schools Programmes (English or
isiZulu set-works - 1 production)
1
e) Test Driving the Arts (min 9
concerts)
9
f) Festive Season (includes large &
Mid-scale scale productions - min 2
productions)
2
g) In-Association Productions (min 10
productions)
10
h) Community Arts Festival (min 3
productions)
3
i) Outside Hirers (min 20 productions)
20
36
To produce and present shows that
have artistic, entertainment and
educational value (subject to available
funding)
Annual
Target
Has the
objective been
met? (Yes/No)
The AAP was finalised by 28 February 2011.
Yes
a) 2 Productions were presented.
1. The National Iscathathamiya Competition
2. Sishayingoma production
Yes
b) 3 Productions were presented:
1. For Generations
2. Race
3. Mein Soldat.
Yes
c) 8 Productions were presented:
1. Gospel Concert
2. Threads
3. Open Mic
Yes
d) 2 Productions were presented:
1. Just Don't
2. Othello
Yes
e) 11 Concerts were presented.
Yes
f) 3 Productions were presented:
1. A large-scale musical production - Cinderella,
2. A mid-scale production - A Tribute to the Jazz Greats
3. A small-scale production - Just for You.
Yes
g) 16 In-Association productions were
presented during the year:
1. Durban Passion Play
2. Women: South Africans of Indian
Origin book launch
3. A New Day
4. Izimbongi Zenkululeko (Part 1)
5. Izimbongi Zenkululeko (Part II)
6. Mandela Trilogy
Yes
h) 3 Productions were presented:
1. Just Don't
2. Rice
3. Sisenga Ilala
Yes
i) 38 Productions were presented:
1. KZN Music House Celebration Concert
2. Sitting around the fire
3. Mummenschanz
4. A Plague of Heroes
5. Krish Swamivel’s Dance Climax 2011
6. uThembalethu
7. Anup Jalota - Live in Concert
8. Caltex Iscathamiya High School
9. Voices for the Village
10. Unlimited Empowerment Awards
11. KZNPO Winter Season Gala Concert
12. SASCE Workshop
13. Charous in Denial
14. Belly of the Beast
15. Thoroughly Modern Millie (Northcliff)
16. Marc Lottering - Not in 3D
17. The Nutcracker - Imperial Russian Ballet
18. Legacy of Broadway - RMB Private Bank
19. IFBB KZN Bodybuilders Championships
4.
5.
6.
7.
8.
Exhibition
Inter-generational Dialogue
Cooley Odyssey
Dance For A Cure
Shika-Land.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
20.
21.
22.
23.
24.
25.
26.
27.
28.
29.
30.
31.
32.
33.
34.
35.
36.
37.
38.
The Coolie Odyssey
Dance for a Cure
Shika-Land!
Shall We Dance
Dance like a Man
Rhythm Divine
Sishayingoma
Welcome to South Africa
Othello
Abnormal Loads
Ballet Africa - KZN Dance Centre
RAD Genee Dance Challenge
Dr Nala Tehilla Song
KZNPO Young Performers
No Swearing - Carvin Goldstone
COSATU Meeting
Umkhosi Wezinkondlo Zama-Afrika
Don Quixote - Mzansi Productions
Izimbongi Zenkululeko (Part 4)
Fusion Fantasia
Durban Music School 10th
Anniversary Concert
Last Night of the Proms
Stars of the Ballet Moscow
Zulu Comedy Corner
Original Material Awards
Izimbongi Zenkululeko (Part 4)
The 2011 D&C Dance Awards
iThemba-Tattu
Red
37
Strategic objectives/outcomes
Actions to support
strategic objectives
performance indicators 20112012
Annual
Target
1.
Implement the AAP by
To produce and present
31 March annually.
shows that have artistic,
entertainment and
educational value (subject to
available funding)
cont.
j) Mobile Stage (min 40
performances).
40
2.
Ensure equity in our artistic
programming.
AAP to ensure that at
least 50% of previously
marginalised groups
participate annually.
Artistic panel and peer review
process to ensure that minimum
of 50% of previously marginalised
groups participate annually.
50%
3.
To position and strengthen
brand, increase box office
income, market in-house
productions, develop
partnerships.
Secure partnerships with
media houses.
Secured publicity and media
R900,000
partnerships to a value > R900 000
per annum.
Develop market campaigns
for in house productions in
order to maximize box office
income.
Marketing plan in place by the 1st
of February annually.
Yes
Rollout of the individual in-house
production marketing campaigns
to be approved by the CEO not
less than 6 months before the
run for large scale productions
and 3 months for medium scale
productions.
Yes
4.
Stage Technical Services:
to ensure that all theatre
venues and resources,
Sound, Lighting, Wardrobe
and Recording Studio, are
running optimally.
Review and implement
the maintenance plans for
all venues and resources:
Sound, Lighting, Wardrobe
and Recording Studio.
A quarterly maintenance report
with evidence-based improvement
is in place for all venues and
resources: Sound, Lighting,
Wardrobe and Recording Studio.
4
5.
To deliver high quality
customer service at Front of
House.
Conduct on-going customer
surveys.
Report on Annual Satisfaction
Survey quarterly.
4
38
Has the
objective
been met?
(Yes/No)
Yes
j) 57 Performances were presented:
1. KZN Music House
Celebration Concert - 1
performance
2. DACSR KZN - 1
performance
3. Just Don’t - tour 1 - 13
performances
4. Comrades Marathon - 1
performance
5. Abstinence tour KZN - 5
performances
6. Mandela Day - 1 performance
Yes
The Annual Arts Plan was finalised in February 2011 ensuring equity
compliance of 84%.
Yes
Publicity and media partnerships exceeded R900,000.
Yes
The marketing plan was approved on 1 February 2011. A marketing
campaign for each in-house season was developed and rolled out
accordingly.
Yes
Marketing campaigns were successfully rolled out.
Yes
Quarterly maintenance reports are updated on a monthly basis.Corrective
action is taken where required.
Yes
Customer surveys have been consolidated into monthly summaries.
Corrective measures are suggested in the Situational Analysis report.
performances
8. Isolezwe on Saturday
Promotion - 1 performance
9. Umhlanga/Royal Reed dance
- 1 performance
10. Just Don’t - 1 performance
11. Sishayingoma - 1
performance
performances
39
2. CORPORATE GOVERNANCE AND FINANCE OPERATIONAL PLAN
Strategic objectives/
outcomes
Actions to support strategic
objectives
Annual
Target
1. To provide effective
and efficient financial
administration and
corporate governance.
Ensure good governance
practices and applicable legislative
requirements are adhered to in the
organization.
Unqualified audit report yearly.
Yes
Zero report points on Financial
Statements and Performance
Information.
Yes
Review and update all the Policies
and Procedures in the organization
on an annual basis.
An annual communication report
detailing the changes to all policies
within the organization by 1 April
2012.
Yes
Ensuring Internal Audits are
completed on a quarterly basis.
4 Internal audits to be conducted
annually on a quarterly basis.
4
Ensuring good governance and
controls are in place.
Maximum of 10% critical findings to
be raised per internal audit quarterly
report of total findings.
10%
Risk assessment completed on an
annual basis.
1 Risk assessment report prepared
on an annual basis by 30 April.
1
Review the IT plan.
Improve IT infrastructure. Supply
efficient IT resources to all
departments.
Less than 10% downtime in
operations reflected in monthly
report.
10%
3. Fixed Assets: Increase
efficiency in the
management of fixed
assets.
Bi-annual verification of fixed
assets.
Monthly update of the fixed asset
register and bar coding of new
assets.
Completed fixed asset register in
compliance with Fixed Asset Policy
by 31 March of each year.
Yes
4. Supply Chain
Management (SCM):
To enforce compliance
with SCM policies and
procedures.
Conduct departmental workshops
to cover all SCM compliance
issues.
SCM report reflecting the above
issue to be submitted monthly.
1
Communicate all threshold
values to management and SCM
department.
Ensure threshold values are
discussed with staff within 30 days
on receipt from Treasury.
In line with
Treasury
5. Budgeting and
Reporting: To improve
financial management
and control of The
Playhouse Company
funds.
Monitoring of budgets and
explanation for variances on a
monthly and quarterly basis.
5% variance of actual against
budget must have an explanation on
a monthly basis.
12
Annual Budgets to be submitted to
DAC by draft by the 1 October and
final by the 15th of February each
year.
Monthly management accounts
to be distributed to Management,
FINCO and Audit & Governance
Committee members by 15th of
every month.
12
Quarterly management accounts to
be distributed to key stakeholders
30 days after each quarter.
4
Minimum of 80% debt recovery by
31 March of every year.
80%
2. Implementing controls,
processes and
systems of the above.
6. Bad Debt: develop a
system to guide the
process of incurring
debt.
40
Implement a debt management
system.
Has the objective
been met? (Yes/
No)
Yes
An unqualified clean audit report was received for the
year ended 31 March 2011.
Yes
The audit report did not reflect any findings on the
financial and performance information aspects.
Yes
The roll out of the revised policies took place in March
2011.
Yes
4 Internal audits were conducted.
Yes
0% Critical findings have been reported.
Yes
The risk assessment report was prepared on the 29 April
2011.
Yes
0% Downtime was experienced during the year.
Yes
The interim verification exercise was conducted in
September 2011. The final verification exercise was
completed by 31 March 2012. The fixed asset register is
in compliance with the Fixed Asset Policy.
Yes
The SCM report is presented by the CFO at the monthly
management meetings.
Yes
The threshold limits have not changed.
Yes
The monthly variance reports explaining 5% variances
have been received from the respective managers.
Yes
The respective reports have been submitted within the
stipulated timelines.
Yes
The 4 quarterly reports were submitted timeously to
respective stakeholders.
Yes
82% of debtors excluding legal matters was collectable.
If no, why has the objective not
been met and what is the remedial
action?
41
outcomes
objectives
Annual
Target
1. To ensure a constant
resource of skilled, talented
and motivated employees
to meet the institutions
needs.
Implementation of effective
recruitment, training
and development, and
performance management
systems.
Following plans and system in place
by 1 March of each year, i.e. the
recruitment system, the training
and development plan and the
performance management plan.
Yes
2. Effectively manage,
monitor and evaluate staff
turnover.
Measure annual labour
turnover.
Annual labour turnover of less than
4%.
4%
Review of actual positions filled
against those budgeted.
12
Submission of an Employment Equity
Plan and report to the Department of
Labour every two years.
1
Report on the employment equity
progress versus plan on a quarterly
basis
4
2. Conduct employment equity
committee meetings.
Minutes of meeting made available
within 1 month of meeting
1
Provide skills training that
will capacitate employees to
perform at their peak.
Develop a training plan/budget
annually and ensure implementation
by end of March annually.
Yes
70% of Training plan and budget
accomplished by 31 March of each
year.
70%
Bi-annual Performance
Reviews for all employees.
Performance Reviews completed for
employees on a bi-annual basis.
Yes
Building and maintenance
of sound collaborative
employee relations within the
organisation.
Conduct bi-monthly meetings with
Trade Unions.
6
Convene and negotiate wage
agreement by March of every year
with the Collective Bargaining Forum.
1
3. Compliance to
Employment Equity
legislation.
4. Training and development.
5. Ensure a stable IR
operating environment.
42
1. Review the Employment
Equity Plan.
Has the objective
been met? (Yes/No)
Yes
The respective plans and systems were
finalised by 1 March 2011.
No
If no, why has the objective not been
met and what is the remedial action?
The Annual labour turnover is 8.5%. There
were 5 resignations, 1 normal retirement
and 2 ill health retirements. No remedial
action is envisaged as the reasons for
staff leaving are beyond the control of
the company, however, management
will continuously monitor and act on the
outcome of exit interviews.
Yes
A review of the actual positions against those
budgeted for was performed on a monthly
basis.
Yes
The last report was submitted in November
2010. The next report is due for submission
in October 2012.
Yes
A review of the employment equity against
the plan was performed on a quarterly basis
and reported in the quarterly reports.
Yes
One meeting was held in November 2011
and the minutes were distributed timeously.
Yes
The training plan was ratified in the first week
of May. 86% of the training budget was spent
by the end of March 2012.
Yes
96% of the training budget has been
achieved, whilst, 75% of the planned
interventions were completed.
Yes
The 1st half yearly reviews were completed
in Sept 2011, whilst the 2nd reviews were
completed in April 2012.
Yes
4 meetings of the planned 6 were held. A
mutual agreement was reached regarding the
2 meetings. The January/February meeting
was impractical as most employees were on
leave and there was no meeting during the
wage negotiation period.
Yes
Wage negotiations were convened in the
month of March and an agreement was
concluded in June 2011, with increases
backdated to 1 April.
43
4. SUPPORT SERVICES OPERATIONAL PLAN
outcomes
objectives
Measurable and evidence
based performance
indicators 2011-2012
1.
To provide effective,
efficient and safe
infrastructural support.
Devise and implement an
effective, efficient and timeous
master maintenance plan for the
vehicles, equipment and buildings
by 1 February of each year.
Written monthly maintenance
12
reports and feedback to relevant
departments.
2.
Pursue funding of
capital expenditure
in collaboration
with marketing and
corporate sections and
in consultation with the
CEO.
Develop and implement an Annual
Capital Funding Expenditure
Plan to source funding for capital
expenditure projects.
Annual Capital Funding
Expenditure Plan by 1 February
of each year.
Yes
3.
Maintain a healthy and
safe environment.
Devise and implement a health
and safety plan in accordance with
Health and Safety legislation.
Review Health and Safety Plan
and submit report by 01 May.
Yes
Quarterly Health and Safety
meetings with recorded
minutes.
4
Fleet maintenance plan in place
by 1 April of each year and
implementation on a regular
basis.
Yes
4.
44
Ensure optimal
maintenance of
Playhouse vehicles.
Review, update and implement the
fleet maintenance plan.
Annual
Target
Has the
objective
been met?
(Yes/No)
Yes
12 Monthly reports were collated and issues were
addressed. Feedback was provided to the relevant
departments where necessary.
Yes
The Annual Capital Funding Expenditure Plan was
finalised by 1 February 2011.
Yes
The Health and Safety Plan was reviewed and the
report was submitted on 15 March 2011.
Yes
4 Health and Safety meetings took place during the
year.
Yes
The fleet maintenance plan was approved by 1 April and
implemented on a regular basis during the year.
45
5. REVENUE OPERATIONAL PLAN
outcomes
objectives
Measurable and evidence
based performance
indicators 2011-2012
Annual Target
1.
Optimise secondary
sources of revenue.
Consolidate and implement
comprehensive plans for generating
secondary income.
CFO to consolidate plans for
secondary income for inclusion
in budget, in place by 28
February of each year.
Yes
2.
Investments: optimal
return on investment
of funds ensuring
compliance with the
Investment Policy.
Invest with major banks in the country
with a preferable interest rate of prime
less 5%.
Secure investments with major
banks at rates greater than
(prime less 5%).
Yes
3.
Revenue generated
through the outside
hires: In-Association and
Mobile Stage.
Develop and implement a plan
to achieve the targeted budget
established for the outside hire of the
theatres.
Outside theatre hires to
achieve 90% of budgeted
revenue annually.
90% of annual
budget
established for in-association
productions.
In-association productions
to achieve 90% of budgeted
revenue annually.
90% of annual
budget
established for the outside hire of the
Truck (Mobile Stage).
Truck Hire to achieve 90% of
budgeted revenue annually.
90% of annual
budget
4.
Revenue generated from
office space rentals and
tenants.
Rental schedules with occupancy
rate. Maximize on revenue generated
through office space rentals.
90% of lettable office space
rented was rented out by 31
March of each year.
90% of annual
budget
5.
Revenue generated from
Recording Studio.
Develop a Recording Studio plan
to maximize target budgets by 1
February annually.
Achieve minimum of 90% of
target income by 31 March of
each year.
90% of annual
budget
6.
Costumes, Sets and
Props.
Ensure the proactive drive in the hire
of and revenue generated through
the hire of costumes, sets and
props meets the budgeted targets
established.
Achieve minimum of 90% of
the budgeted revenue by 31
March of each year.
90% of annual
budget
7.
Box office.
Ensure the revenue generated from
ticket sales meets the budgeted
targets established.
90% of Budgeted revenue
90% of annual
generated by 31 March of each budget
year.
46
Has the objective
been met? (Yes/
No)
Yes
Consolidated plans for secondary income were
included in the budget which was approved by
Council by 28 February.
Yes
Funds are invested with five major banks at 5% and
upwards.
Yes
164% of the annual budget was achieved.
Yes
Yes
Yes
No
29% of the annual budget was achieved
due to reasons related to incapacity.
Corrective measures have since been
taken.
Yes
Yes
47
rePort oF tHe AudItor-GenerAL
TO PARLIAMENT ON THE PLAYHOUSE
COMPANY
REPORT ON THE FINANCIAL STATEMENTS
INTRODUCTION
1.
I have audited the financial statements of The Playhouse Company set out on pages 50 to 81, which
comprise the statement of financial position as at 31 March 2012, the statement of financial performance,
statement of changes in net assets and the cash flow statement for the year then ended, and the notes,
comprising a summary of significant accounting policies and other explanatory information.
ACCOUNTING AUTHORITIES RESPONSIBILITY FOR THE FINANCIAL
STATEMENTS
2.
The Council which constitutes the accounting authority is responsible for the preparation and fair
presentation of the financial statements in accordance with South African Standards of Generally
Recognised Accounting Practice (SA Standards of GRAP) and the requirements of the Public Finance
Management Act of South Africa, 1999 (Act No. 1 of 1999) (PFMA) and for such internal control as the
accounting authority determines is necessary to enable the preparation of financial statements that are
free from material misstatement, whether due to fraud or error.
AudITOR-GEnERAl’S RESpOnSIBIlITy
3.
My responsibility is to express an opinion on the financial statements based on my audit. I conducted
my audit in accordance with the Public Audit Act of South Africa, 2004 (Act No. 25 of 2004) (PAA),
the General Notice issued in terms thereof and International Standards on Auditing. Those standards
require that I comply with ethical requirements and plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free from material misstatement.
4.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures
in the financial statements. The procedures selected depend on the auditor’s judgement, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or
error. In making those risk assessments, the auditor considers internal control relevant to the entity’s
preparation and fair presentation of the financial statements in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness
of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting
policies used and the reasonableness of accounting estimates made by management, as well as
evaluating the overall presentation of the financial statements.
5.
I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my
audit opinion.
OPINION
6.
In my opinion, the financial statements present fairly, in all material respects, the financial position of
The Playhouse Company as at 31 March 2012, and its financial performance and cash flows for the
year then ended in accordance with South African Standards of Generally Recognised Accounting
Practice (SA Standards of GRAP) and the requirements of the PFMA.
48
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
7.
In accordance with the PAA and the General Notice issued in terms thereof, I report the following findings
relevant to performance against predetermined objectives, compliance with laws and regulations and
internal control, but not for the purpose of expressing an opinion.
PREDETERMINED OBJECTIVES
8.
I performed procedures to obtain evidence about the usefulness and reliability of the information in the
annual performance report as set out on pages 34 to 47 of the annual report.
9.
The reported performance against predetermined objectives was evaluated against the overall criteria
of usefulness and reliability. The usefulness of information in the annual performance report relates
to whether it is presented in accordance with the National Treasury annual reporting principles and
whether the reported performance is consistent with the planned objectives. The usefulness of
information further relates to whether indicators and targets are measurable (i.e. well defined, verifiable,
specific, measurable and time bound) and relevant as required by the National Treasury Framework for
managing programme performance information.
The reliability of the information in respect of the selected programmes is assessed to determine whether
it adequately reflects the facts (i.e. whether it is valid, accurate and complete).
10. There were no material findings on the annual performance report concerning the usefulness and
reliability of the information.
COMPLIANCE WITH LAWS AND REGULATIONS
11. I performed procedures to obtain evidence that the entity has complied with applicable laws and
regulations regarding financial matters, financial management and other related matters.
12. I did not identify any instances of material non-compliance with specific matters in key applicable laws
and regulations as set out in the General Notice issued in terms of the PAA.
INTERNAL CONTROL
13. I considered internal control relevant to my audit of the financial statements, annual performance report
and compliance with laws and regulations.
14. I did not identify any deficiencies in internal control which we considered sufficiently significant for
inclusion in this report.
Pietermaritzburg
31 July 2012
49
ANNUAL FINANCIAL STATEMENTS
STATEMENT OF FINANCIAL PERFORMANCE
Notes
Revenue
Grants
3
Box office income
Other operating income
4
Less: Expenditure
Revised
2012
R
2011
R
81 112 550
67 170 799
71 711 208
59 488 095
2 574 336
1 303 749
6 827 006
6 378 955
37 517 289
25 696 657
Production costs
5
14 308 959
8 500 190
Production and technical services costs
6
5 420 961
4 202 903
Other operating expenditure
7
17 787 369
12 993 564
Emoluments
8
22 236 657
19 281 015
Surplus from operations
9
21 358 604
22 193 127
3 450 950
3 632 935
24 809 554
25 826 062
Interest received
50
10
STATEMENT OF FINANCIAL POSITION
Notes
Revised
2012
R
2011
R
ASSETS
Non-current assets
Heritage assets
11.1
88 330 000
88 330 000
Property, plant and equipment
11.2
88 007 509
79 479 886
Intangible assets
11.3
115 975
159 186
Current assets
72 531 563
56 745 509
Inventories
12
570 382
559 931
Trade and other receivables
13
3 565 052
889 469
Cash and cash equivalents
14
68 396 129
55 296 109
248 985 047
224 714 581
232 021 754
207 212 200
Total assets
NET ASSETS AND LIABILITIES
Net assets
Accumulated surplus
Current liabilities
16 963 293
17 502 381
Trade and other payables
15
5 749 230
8 062 845
Deferred income
16
11 214 063
9 439 536
248 985 047
224 714 581
Total net assets and liabilities
51
STATEMENT OF CHANGES IN NET ASSETS
Notes
Opening accumulated surplus as previously
reported
Change in accounting policy with respect to
heritage assets(note 2)
2
Opening accumulated surplus as restated
Surplus
Closing accumulated surpluses
52
17
2012
R
Revised
204 267 867
172 553 138
2 944 333
8 833 000
207 212 200
181 386 138
24 809 554
25 826 062
232 021 754
207 212 200
2011
R
STATEMENT OF CASH FLOWS
Notes
Revised
2012
R
2011
R
Cash flows from operating activities
Cash receipts from grantors and clients
Cash paid to suppliers and employees
Cash generated from operations
18
Interest received
Net cash from operating activities
89 651 030
76 599 069
(63 452 612)
(54 035 456)
26 198 418
22 563 613
3 450 950
3 632 935
29 649 368
26 196 548
(16 550 635)
(21 639 617)
Cash flows used in investing activities
Additions to property, plant and equipment
Additions to intangibles
(22 713)
(32 352)
Proceeds on sale of property, plant and
equipment
24 000
-
Net cash used in investing activities
(16 549 348)
(21 671 969)
Decrease in long term borrowings
-
-
Net cash from financing activities
-
-
Net increase in cash and cash equivalents
13 100 020
4 524 579
Cash and cash equivalents at beginning of year
55 296 109
50 771 530
68 396 129
55 296 109
Cash flows from financing activities
Cash and cash equivalents at end of year
14
53
1. ACCOUNTING POLICIES
1.1 The financial statements have been prepared in accordance with the effective Standards of Generally Recognised
Accounting Practices (GRAP) including any interpretations, guidelines and directives issued by the Accounting Standards
Board in accordance with Section 55(1)(b) of the Public Finance Management Act, (Act No.1 of 1999 as amended by Act
No. 29 of 1999). Assets, liabilities, revenues and expenses have not been offset except where offsetting is required or
permitted by a Standard of GRAP. The accounting policies are applied consistent with those used to present the previous
year's financial statements, unless explicitly stated. The details of any changes in accounting policies are explained in the
relevant policy.
The annual financial statements have been prepared on an accrual basis of accounting and are in accordance with
historical cost convention, except for financial instruments that have been measured at fair value.
These accounting policies are consistent with the previous year.
Standard of GRAP approved by the Accounting Standards Board and applicable to The Playhouse Company.
GRAP 1 Presentation of financial statements
GRAP 2 Cash flow statements
GRAP 3 Accounting policies, changes in accounting estimates and errors
GRAP 6 Consolidated financial statements and accounting for controlled entities
GRAP 9 Revenue from exchange transactions
GRAP 12 Inventories
GRAP 13 Leases
GRAP 14 Events after the reporting date
GRAP 17 Property, plant and equipment
GRAP 19 Provisions, contingent liabilities and contingent asset
GRAP 100 Non-current assets held for sale and discontinued operations
GRAP 102 Intangible assets
IPSAS 20 Related party disclosures
The following statements of Generally Recognised Accounting Practice (GRAP) issued by the Accounting Standards
Board are in issue but not applicable to The Playhouse Company:
GRAP 4 The effects of changes in foreign exchange rates
GRAP 5 Borrowings
GRAP 7 Accounting for investments in associates
GRAP 8 Financial reporting of interests in joint ventures
GRAP 10 Financial reporting in hyperinflationary economies
GRAP 11 Construction contracts
GRAP 16 Investment property
GRAP 101 Agriculture
IFRS 3 Business combinations
IFRS 4 Insurance contracts
IFRS 6 Exploration for and evaluation of mineral resources
IAS 12 Income taxes
IFRIC 4 Determining whether an arrangement contains a Lease
IFRIC 12 Service concession arrangements
IFRIC 13 Customer loyalty programmes
IFRIC 15 Agreements for the construction of real estate
SIC 21 Income taxes - recovery of revalued non-depreciable assets
54
SIC 25 Income taxes - changes in the tax status of an entity or its shareholders
SIC 29 Service concession arrangements
IFRIC 17 Distributions of non-cash assets to owners
IFRIC 18 Transfer of assets from customers
The following statements of Generally Recognised Accounting Practice (GRAP) issued by the Accounting Standards
Board are in effect but are not yet applicable in full to schedule 3A and 3C public entities and constitutional institutions:
GRAP 21 Impairment of Non-cash-generating Assets (not applicable to The Playhouse Company)
GRAP 23 Revenue from Non-exchange transactions taxes and transfers (principles of policy applied)
GRAP 24 Presentation of budget information (principles of policy applied)
GRAP 26 Impairment of cash-generating assets
GRAP 103 Heritage assets (early adopted)
GRAP 104 Financial instruments
GRAP 105 Transfers of functions between entities under common control
GRAP 106 Transfers of functions between entities not under common control
GRAP 107 Mergers
The recognition and measurement principles in the above GRAP statements compared to the respective GAAP statements
that they have replaced do not differ or result in material differences in items presented and disclosed in the financial
statements.
1.2. Use of estimates and judgments
The preparation of financial statements requires management to make judgments, estimates and assumptions that affect
the application of accounting policies and the reported amounts of assets and liabilities, income and expenses. The
estimates and associated assumptions are based on historical experience and various other factors that are believed to
be reasonable under the circumstances, the results of which form the basis of making judgments about carrying values
of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an on-going basis. Revisions to accounting estimates are
recognised in the period in which the estimate is revised if the revision affects only that period or in the period of the
revision and future period if the revision affects both current and future periods.
In particular, information about significant areas of estimation, uncertainty and critical judgments in applying accounting
policies that have the most significant effect on the amount recognised in the financial statements are described in the
following note:
Note 1.3 Property, plant and equipment
Note 1.5 Intangible assets
Note 1.12 Provisions
1.3. Property, plant and equipment
Property, plant and equipment are stated at historical cost less accumulated depreciation and accumulated impairment
losses. The useful life of the assets have been arrived at after careful consideration of all factors affecting The Playhouse
Company. The useful life and depreciation method of assets is reassessed on an annual basis and any change in estimate
is taken into account in the determination of remaining depreciation and amortisation charges. The residual value of
property plant and equipment is zero as the assets are used for their entire economic life.
55
ACCOunTInG pOlICIES (COnT...)
Depreciation is calculated on the straight-line method, to write-off the cost of each asset to estimated residual values over
its estimated useful life as follows:
Buildings
: 50 Years
Motor vehicles
: 5 Years
Office furniture and other equipment
: 5 Years
Computer equipment
: 3 Years
Stage equipment
: 4 Years
Workshop equipment
: 5 Years
Artworks are not depreciated and stage props, costumes and music
: 5 Years
and drama scripts are written off on acquisition.
Subsequent expenditure relating to an item of property, plant and equipment is capitalised when it is probable that future
economic benefits from the use of asset will be increased. All other subsequent expenditure is recognised as an expense
in the period in which it is incurred.
1.4. Impairment
Non-financial assets
The carrying amount of The Playhouse Company assets, other than inventories, are reviewed at each reporting date to
determine whether there is any indication of impairment. If any such indication exists, the asset’s recoverable amount is
estimated.
The recoverable amount of an asset is the greater of its value in use and its fair value less costs to sell. For the purpose
of impairment testing, the condition of the asset is evaluated to ascertain its value in use. Where the asset is damaged
beyond repair, the fair value of the asset is its scrap value.
An impairment loss is recognised if the carrying amount of the asset exceeds its recoverable amount. Impairment losses
are recognised in profit or loss.
Reversals of impairment
An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An
impairment loss is reversed only to the extent that the assets carrying amount does not exceed the carrying amount that
would have been determined net of depreciation or amortisation, if no impairment loss has been recognised.
1.5. Intangible assets
Intangible assets are shown at cost less accumulated amortisation and impairment losses. The useful life of intangibles
is reassessed on an annual basis and any change in estimate is taken into account in the determination of remaining
amortisation charges. The amortisation is calculated on the straight line method to write-off the cost of intangible assets
over their estimated useful life as follows:
Software : 2 Years
1.6. Heritage assets
Heritage assets are assets that have a cultural, environmental, historical, natural, scientific, technological or artistic significance
and are held indefinitely for the benefit of present and future generations.
Heritage assets are recognised as an asset if, and only if : (a) it is probable that future economic benefits or service potential
association with the asset will flow to the entity, and (b) the cost or fair value of the asset can be measured reliably.
A heritage asset that qualifies for recognition as an asset shall be measured at its cost.
Where the heritage asset is acquired through a non-exchange transaction, its cost shall be measured at its fair value as at date
of acquisition.
After recognition as an asset, a class of heritage asset shall be carried at its cost less any accumulated impairment losses.
56
1.7. Leases
Leases in terms of which The Playhouse Company assumes substantially all the risks and rewards of ownership are classified
as finance leases. Upon initial recognition, the leased asset is measured at an amount equal to the lower of its fair value and the
present value of minimum lease payments. Subsequent to initial recognition, the asset is accounted for in accordance with the
accounting policy applicable to that asset.
Minimum lease payments are apportioned between the finance expense and the reduction of the outstanding liability. The
finance expense is allocated to each period during the lease term so as to produce a consistent periodic rate of interest in the
remaining balance of the liability.
1.8. Inventories
Inventories are carried at the lower of cost and net realisable value. The cost of inventories comprises all costs of purchase,
conversion and other costs incurred in bringing the inventories to their present location and condition, and is determined using
the first-in, first-out method. Obsolete, redundant and slow moving inventories are identified on a regular basis and are written
down to their estimated net realizable values.
1.9. Financial instruments
Measurement
Financial instruments are initially measured at cost, which includes transaction costs. Subsequent to initial recognition these
instruments are measured as set out below:
Trade and other receivables originated by The Playhouse Company are stated at cost less provision for doubtful debts.
Receivables are written off when considered irrecoverable. Trade and other receivables and provision for doubtful debts are
discounted using the effective interest rate where considered applicable.
Cash and cash equivalents
Cash and cash equivalents are measured at fair value.
Trade and other payables
Trade and other payables originated by The Playhouse Company are stated at cost. Trade and other payables are discounted
using the effective interest rate where considered applicable.
Gains and losses on subsequent measurement
Gains and losses arising from a change in the fair value of financial instruments that are not part of a hedging relationship are
included in net profit or loss in the period in which the change arises.
1.10. Retirement benefit plans
It is the policy of The Playhouse Company to provide retirement benefits for the employees. The Playhouse Company’s
contributions in respect of defined contribution plans and benefit plans are expensed as incurred.
1.11. Revenue from non-exchange transactions
Revenue from non-exchange transactions arises when an entity receives value from another entity without directly giving
approximately equal value in exchange. An asset acquired through a non-exchange transaction shall initially be measured at its
fair value as at the date of acquisition.
This revenue will be measured at the amount of increase in net assets recognised by the entity.
An inflow of resources from a non-exchange transaction recognised as an asset shall be recognised as revenue, except to the
extent that a liability is recognised for the same inflow. As an entity satisfies a present obligation recognised as a liability in
respect of an inflow of resources from a non-exchange transaction recognised as an asset, it will reduce the carrying amount of
the liability recognised as an amount equal to that reduction.
The Playhouse Company has entered into a lease agreement for the free use of certain land and buildings.
57
ACCOunTInG pOlICIES (COnT...)
1.12. Revenue
Grants
Grants related to operational expenditure is recognised as revenue when it is probable that the transfer payment will be received
and the amount can be estimated reliably, unless, an obligation exists to use the transferred resources in a certain way or return
the resources to the transferor. Where it is a requirement to only use the resources in a certain way with no corresponding
requirement to return those resources, then no obligation exists and the revenue is recognised. Where an obligation exists, the
resource is recognised as deferred revenue until the obligations are met and then recognised as revenue.
Grants related to the acquisition or construction of an asset is recognised as revenue when it is probable that the transfer
payment will be received and the amount can be estimated reliably, unless, an obligation exists to use the transferred resources
in a certain way or return the resources to the transferor. Where it is a requirement to only use the resources in a certain way
with no corresponding requirement to return those resources, then no obligation exists and the revenue is recognised. Where an
obligation exists, the resource is recognised as deferred revenue until the obligations are met and then recognised as revenue.
Interest Income
Interest income is recognised on a time proportion basis, taking into account of the principal outstanding and the effective rate
over the period to maturity, when it is probable that such income will accrue to The Playhouse Company.
Box office and related income
Box office and related income is recognised when the production has been staged. Complimentary tickets issued to promote and
market the productions have no value and are not included in box office and related income.
Other income
Other income is recognized when it is probable that the future economic benefits will flow to The Playhouse Company and it can
be measured reliably.
1.13. Provisions
Provisions are recognised when The Playhouse Company has a present legal or constructive obligation as a result of past
events, for which it is probable that an outflow of economic benefits will occur, and where a reliable estimate can be made of
the amount of the obligation. Where the effect of discounting is material, provisions are discounted. The discount rate used
is a rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the
liability.
1.14. Cash and cash equivalents
For the purpose of the cash flow statement, cash and cash equivalents comprise cash on hand, deposits held on call with
banks, and investments in money market instruments, net of bank overdrafts, all of which are available for use by The Playhouse
Company unless otherwise stated.
1.15. Related party
Related party transaction is a transfer of resources or obligations between related parties, regardless of whether a price is
charged. Parties are considered to be related if one party has the ability to control the other party or exercise significant influence
over the other party in making financial and operating decisions or if the related party entity and another entity are subject to
common control. The disclosure note details the related party transactions.
1.16. Commitments
Commitments represent goods/services that have been approved and/or contracted, but where no delivery has taken place at
the reporting date. Commitments are thus not recognised in the statement of financial position as a liability or as expenditure in
the statement of financial performance but are included in the disclosure notes.
1.17. Comparative figures
The change in accounting policy(note 2) relating to the recognition of heritage assets resulted in the 2011 and prior years trading
results being amended. The annual financial statements discloses this as “Revised March 2011” financial information.
58
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
Notes
2012
Revised 2011
R
R
2. Change in accounting policy
The Playhouse Company changed its policy in respect of Heritage Assets to comply with the requirements of GRAP 103.The
Playhouse Company Theatre was previously recognised in The Playhouse Company books of account as Property, Plant and
Equipment, at fair value, and amortised over its useful life. This was done to comply with GRAP17 - Property, Plant and Equipment.
GRAP 103 requires historical buildings that have a significant historical association be recognised as heritage assets. Under
the cost model of recognition, after recognition as an asset, a class of heritage asset shall be carried at its cost less any
accumulated impairment losses. The change in accounting policy has been accounted for retrospectively.
The effect of the change in accounting policy is as follows:
Decrease in Depreciation
8 833 000
Net increase in changes in net assets as at 1 April 2010
8 833 000
Decrease in Property, plant and equipment
(88 330 000)
Increase in Heritage assets
88 330 000
Net change in Statement of Financial Position as
at 1 April 2010
0
Decrease in Depreciation
2 944 333
Net increase in Surplus for the year ended
31 March 2011
2 944 333
3. Grants
National department of arts and culture (DAC)
36 138 000
38 950 613
Special capital expenditure grant (DAC)
26 128 646
11 554 077
KZN Department of arts, culture and tourism
6 401 000
6 096 000
eThekwini municipality
3 043 562
2 887 405
71 711 208
59 488 095
Revenue from exchange transactions
4 183 845
3 977 081
Hire of performance venues, costumes, sets, and
Mobile stage
1 829 508
2 145 444
Rent received
653 365
926 417
Bar & other sales
544 965
480 965
45 485
86 605
133 130
117 340
Total
4. Other operating income
Functions
Box office commission – external productions
Gains on sale of motor vehicles
Sundry revenue - admin and computicket commission
24 000
951 722
217 120
1 670
3 190
Donations and sponsorships (productions)
2 643 161
2 401 874
Total
6 827 006
6 378 955
Sale of CD’s
Revenue from non-exchange transactions
59
nOTES TO THE AnnuAl FInAnCIAl STATEMEnTS (COnT...)
Notes
2012
Revised 2011
R
R
12 709 046
7 622 299
263
63 317
12 617 151
6 926 822
91 632
632 160
5. Production costs
Direct production costs
Outside hirers costs
Productions and festivals
Mobile stage
Indirect production costs
Total
1 599 913
877 891
14 308 959
8 500 190
6. Production and technical services costs
Workshop
1 559 267
887 583
Technical services
3 861 694
3 315 320
Total
5 420 961
4 202 903
Transport
377 499
367 203
Deco hire
30 704
16 911
7. Other operating expenditure
Wardrobe
37 609
19 314
Maintenance and security
4 546 388
3 941 534
Other services - human resource, finance, corporate
3 784 247
3 176 465
General - consultants, insurance and phones
713 268
984 082
Cost of sales - bar and other
208 718
187 880
Depreciation & amortisation
8 088 936
4 300 175
Depreciation & amortisation on fixed assets
8 681 055
7 097 126
Depreciation & amortisation write-back
(592 119)
(2 796 951)
17 787 369
12 993 564
Salaries
15 574 878
13 987 892
Adhocs
1 380 820
852 285
Total
8. Emoluments
Pension fund
Provident fund
Medical aid
Uif
430 448
1 855 494
525 274
467 207
140 674
122 262
1 334 852
1 119 144
Overtime
201 728
147 997
Leave
527 639
(94 959)
84 402
41 330
288 564
300 615
Bonus
Council - attendance
Housing subsidies
Long service awards
Total
60
2 109 326
68 500
51 300
22 236 657
19 281 015
Notes
2012
Revised 2011
R
R
324 829
559 975
8 023 012
4 319 664
Motor vehicles
522 233
158 682
Office furniture and other equipment
956 694
1 607 779
Computer equipment
172 423
261 574
3 663 152
2 436 636
9. Surplus from operations
Surplus from operations is arrived at after taking into account:
Expenditure
Auditors’ remuneration:
Depreciation of property, plant and equipment:
Stage equipment
Workshop equipment
8 987
12 795
3 286 424
2 535 973
8 609 913
7 013 439
(586 901)
(2 693 775)
65 924
(19 489)
Intangible assets
71 142
83 687
Amortisation write back
(5 218)
(103 176)
-
391
3 061 185
2 702 638
19 175 472
16 578 377
Professional services:
309 106
488 303
Internal audit fees
267 943
369 134
Consultancy fees
41 163
119 169
Leased assets
Depreciation write back
Amortisation
Impairments
Emoluments - senior management and council
Staff costs
21
10. Surplus for the year
The Surplus for the current year reflected in the statement of financial performance is due to the recognition of capital grants for R26 128 646.
The surplus for the 2011 year reflected in the statement of financial performance is due to donations and sponsorships for productions of
R2 401 887 and capital grants received R11 554 000 and Pension Fund for R 4 899 613.
11. Heritage assets, property, plant and equipment and intangible assets
11.1. Heritage assets
Carrying amount
88 330 000
88 330 000
Gross carrying amount
88 330 000
88 300 000
Accumulated depreciation
-
-
Additions
-
-
Fair value adjustment
-
-
Transfers
-
-
Impairment
-
-
Cost
-
-
-
-
88 330 000
88 330 000
Disposals
Carrying amount at year end
Heritage assets comprises of land and buildings : Rem of Portion 1 of ERF 10636 of Durban. The property was valued by eThekwini
Municipality in May 2008. The land and buildings is registered in the name of the Department of Public Works. The Playhouse Company
leases the land and buildings from The Department of Public Works for no consideration.
61
11.2. Reconciliation of carrying value of property, plant and equipment
Motor Vehicles
Office Furniture and
Other Equipment
Computer
Equipment
Stage Equipment
R
R
R
R
243 856
2 418 680
367 232
5 144 878
1 062 704
7 193 784
1 287 528
14 467 332
(818 848)
(4 775 104)
(920 296)
(9 322 454)
Additions
1 604 735
60 287
45 252
6 237 566
-
1 094
207
4 039
Transfers
-
-
-
-
(1)
(253)
(3)
(61)
(158 682)
(1 607 779)
(261 574)
(2 436 636)
161 869
1 751 205
111 425
667 955
Disposals
-
-
-
-
Cost
-
-
-
-
-
-
-
-
Carrying amount 31 March 2011
1 851 777
2 623 234
262 539
9 617 741
2 667 439
7 255 165
1 332 987
20 708 937
(815 662)
(4 631 931)
(1 070 448)
(11 091 196)
532 768
126 762
439 691
5 003 588
-
-
-
-
Transfers
-
-
-
-
Carrying amount 1 April 2010
Impairment
Depreciation
Depreciation write-back
Additions
Impairment
Depreciation
Depreciation write-back
-
-
-
-
(522 233)
(956 694)
(172 423)
(3 663 152)
25 453
16 965
134 172
407 829
-
-
-
-
(108 971)
-
-
-
Disposals
Cost
108 971
-
-
-
1 887 765
1 810 267
663 979
11 366 006
3 200 207
7 381 927
1 772 678
25 712 525
(1 312 442)
(5 571 660)
(1 108 699)
(14 346 519)
Land and buildings comprise of:
1.
Rem of Portion 3 of ERF 615 of Brickfield
2.
Portion 3 of ERF 10635 of Durban
The land and buildings is registered in the name of the Department of Public Works. The Playhouse Company leases the land and
buildings from The Department of Public Works for no consideration.
The gross carrying value of fully depreciated property, plant and equipment that is still in use is R3 183 703. The major category of
items is stage equipment comprising of lighting and sound items.
The useful life, depreciation method and residual values of assets is reassessed on an annual basis, and adjustments are processed
when necessary.
62
Workshop
Equipment
Work in progress
Artworks
Capitalised Leased
Assets (office
equip, Land and
Buildings)
Total
R
R
R
R
R
28 528
5 468 942
469 870
48 012 834
62 154 820
106 907
5 468 942
469 870
53 570 000
83 627 067
(78 379)
-
-
(5 557 166)
(21 472 247)
1 824
13 689 953
-
-
21 639 617
164
-
-
-
5 504
-
(16 576 732)
-
16 576 732
-
(73)
-
-
-
(391)
(12 795)
-
-
(2 535 973)
(7 013 439)
1 322
-
-
(1)
2 693 775
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
18 970
2 582 163
469 870
62 053 592
79 479 886
108 895
2 582 163
469 870
70 146 732
105 272 188
(89 925)
-
-
(8 093 140)
(25 792 302)
41 070
10 406 756
-
-
16 550 635
-
-
-
-
-
(6 109 737)
-
6 109 737
-
-
-
-
-
(8 987)
-
-
(3 286 424)
(8 609 913)
2 482
-
-
-
586 901
-
-
-
-
-
-
-
-
-
(108 971)
-
-
-
-
108 971
53 535
6 879 182
469 870
64 876 905
88 007 509
149 965
6 879 182
469 870
76 256 469
121 822 823
(96 430)
-
-
(11 379 564)
(33 815 314)
63
Software
Total
R
R
Carrying amount 1 April 2010
107 342
107 342
372 367
372 367
(265 025)
(265 025)
11.3 Intangible assets
Accumulated amortisation
Additions
32 352
32 352
3
3
Impairment
-
-
Amortisation
(83 687)
(83 687)
Amortisation write-back
103 176
103 176
Disposals
-
-
Cost
-
-
-
-
159 186
159 186
Additions
404 722
404 722
(245 536)
(245 536)
22 713
22 713
-
-
(71 142)
(71 142)
5 218
5 218
Disposals
-
-
Cost
-
-
-
-
115 975
115 975
427 435
427 435
(311 460)
(311 460)
Amortisation
Amortisation write-back
Amortisation is included with depreciation.
2012
Revised 2011
R
R
62 077
96 651
Workshop
130 289
117 252
Wardrobe
79 903
66 691
298 113
279 337
570 382
559 931
12. Inventories
Catering
General stores
64
2012
Revised 2011
R
R
515 300
406 513
11 193
6 693
13.Trade and other receivables
Trade receivables
Staff debtors
Other receivables and accruals
Less: Debtors impairment
3 309 896
709 089
3 836 389
1 122 295
(271 337)
(232 826)
3 565 052
889 469
232 826
119 749
13.1. Movement in the provision for impairment
of trade receivables
Balance at 1 April
Provision for receivables impairment
38 511
195 761
Receivables written off during the year as uncollectible
-
(81 774)
Unused amounts reversed
-
(910)
Unwinding of discount
-
-
Balance at 31 March
271 337
232 826
9 896 129
1 896 109
Investments - fixed deposits
58 500 000
53 400 000
Cash available in 30 days
35 500 000
28 000 000
14. Cash and cash equivalents
Cash available immediately
1 500 000
-
21 500 000
25 400 000
68 396 129
55 296 109
Trade payables
1 926 575
4 692 207
Other payables and accruals
1 458 261
1 475 104
Leave pay accrual
1 790 310
1 396 362
574 084
499 172
5 749 230
8 062 845
R 277 816 and R 30 360 is pledged as security for guarantees
issued by FNB on behalf of The Playhouse Company for
eThekwini Municipality and The Postmaster respectively. The
guarantees will expire on 31 December 2025 and will not be
renewed.
15. Trade and other payables
Bonus accrual
65
2012
Revised 2011
R
R
Special grant - National department of arts and culture
1 286 055
1 286 055
Opening balance
1 286 055
1 286 055
Less : Amounts recognised as income
-
-
Less : Amounts used to acquire assets
-
-
Grant received in advance
9 928 008
8 153 481
National department of arts and culture
9 727 078
7 085 723
-
728 348
200 930
339 410
11 214 063
9 439 536
16. Deferred Income
eThekwini municipality
Transnet sponsorship - mobile stage (refer note 23.6)
Conditional grant
National Department of Arts and Culture
The Playhouse Company receives public funding from the National department of arts and culture.
In terms of Para 53(3) of the Public Finance Management Act, 1999, the public entity may not budget for a deficit and may not
accumulate surpluses unless written approval of The National Treasury has been obtained.
Unless written approval is received, the unused grants must be returned to National Treasury.
The Playhouse Company has received the approval from National Treasury to retain the accumulated surplus.
66
Conditional grant
The KwaZulu-Natal Department of Arts, Culture and Tourism
The Playhouse Company receives public funding from the Kwazulu-Natal Department of Arts, Culture and Tourism.
As a declared cultural institution, The Playhouse Company has objectives that have been agreed to by the Department:
1. To comply with the declaration that The Playhouse Company has in place effective, efficient and transparent financial
management and controls systems for the management of the transfer payment from the Department.
2. To utilise the funding in accordance with the business plan.
3. To utilise the funding in accordance with the objectives set out in the memorandum of agreements and not for any other
objectives not stipulated therein.
4. To utilise the funding subject to any written directives issued by the Head of the Department.
5. To submit quarterly reports to the Department on or before the agreed dates.
5.1.
To ensure that the quarterly reports provide a detailed report on the achievements against the objectives set out
in the business plan.
5.2.
To ensure that the quarterly reports contain an expenditure report detailing how the funding was used against
the business plan.
5.3.
To ensure that the quarterly report contain any other information and or documents that the Department may
require.
6. To submit to the Department the close out report for the 2011/2012 financial year by no later than the 30th April 2012.
7. To provide the Department with such financial reporting information required by it to enable it to comply with the statutory
and ancillary reporting obligations applicable to it from time to time and to enable it to properly account for the transfer
of funds in its books of account.
8. To account for the interest earned each month and acknowledges that the Department reserves the right to determine the
utilisation of the interest.
9. To maintain an appropriate procurement and provisioning system which is fair, equitable, transparent, competitive and cost
effective.
10. To immediately notify the Department in writing of any failure on its part to achieve any of its obligations.
11.1 To ensure that in its execution of the MOA and in the performance of its duties, the Cultural Institution does not cause
breach of any other agreement to which The Playhouse Company is a party.
11.2 To ensure that any other agreement that the Cultural Institution may enter into with such other parties as may be
necessary to fulfil its obligations to the Department, shall not in any way be in conflict or cause a conflict with the
provisions of the memorandum of agreement.
67
16. Deferred Income
Conditional grant
eThekwini Municipality
The EThekwini municipality has entered into an agreement with The Playhouse Company for the granting of financial
assistance.
The EThekwini Municipality and The Playhouse Company were busy with negotiations for the March 2012 grant as at 31st
March 2012. The memorandum of agreement was finalised in May 2012.
The funds are granted based on The Playhouse Company achieving certain performance related obligations.
These obligations are set out hereunder:
1. The Playhouse Company shall apply the funds to the attainment of its main object as a Cultural Institution.
2. The Playhouse Company shall commit itself to contributing meaningfully to the improvement of the quality of life of
communities within EThekwini Municipality by:
2.1.
Providing, through the medium of music, dance, drama, theatricals and cultural entertainment, educations and
development.
2.2.
Identifying and nurturing local talent and skills.
2.3.
Creating platforms within the communities for the experience of live music, dance drama, theatricals and cultural
entertainment.
2.4.
Contributing and playing a promotional and a significant role in economic development and tourism.
2.5.
Ensuring The Playhouse Company’s artistic growth, financial sustainability and achieving excellence in all its
activities.
3. The Artistic Director and Chief Executive of The Playhouse Company and the City manager of EThekwini
shall have a formal review of The Playhouse Company’s performance at least once a year.
Municipality
4. Payment of the grant will be inter alia dependent on attainment of the following financial targets, performance targets and
other obligations:
4.1.
An increase in own revenue of 5% per annum. If target not met, then reasons need to be supplied.
4.2.
Secure funding from other sources, including other spheres of government.
4.3.
The ratio of administrative staff costs in relation to total expenditure should not exceed 40%.
4.4.
Current outreach programmes must be maintained and the presentation of relevant statistics reflecting new
community outreach programmes for the year ended.
4.5.
The Playhouse Company must endeavour to make the facilities and services available free of charge to
applicants (max of 10 per Council financial year), referred by the city in accordance with the following:
4.5.1. The facilities are made available or an alternative date made available.
4.5.2 Applicants referred to The Playhouse Company shall have the same rights and obligations as ordinary clients.
68
4.6.
The Playhouse Company shall submit a copy of the quarterly Artistic Directors Report which contains details on
The Playhouse Company’s performance and development activities undertaken.
4.7.
The Playhouse Company shall provide monthly income and expenditure reports before the 15th of the following
month.
4.8.
The Playhouse Company shall provide a copy of its audited AFS as soon as it becomes available but not later
than the 31st of August each year.
4.9.
The Playhouse Company shall provide a copy of its annual report to the National Department of Arts and
Culture.
2012
Revised 2011
R
R
232 021 754
207 212 200
141 900 000
141 900 000
90 121 754
65 312 200
24 809 554
25 826 062
8 088 936
4 300 566
(24 000)
-
(3 450 950)
(3 632 935)
-
(5 507)
29 423 540
26 488 186
(3 225 122)
(3 924 573)
17. Reconciliation of statement of changes in net
assets
Balance at 31 March 2012
Made up as follows:
GRAP 23 Government grant recognised on free use of land and building
Changes in net assets relating to operations
18. Reconciliation of cash generated/ utilised by
operations
Cash generated by operations
Adjusted for:
Depreciation, amortisation and impairment
Profit on disposal of property, plant and equipment
Interest received
Operating cash flows before working capital changes
Working capital changes
(10 451)
26 532
Increase in trade and other receivables
(Increase) Decrease in inventories
(2 675 583)
(11 266)
Decrease in trade and other payables
(2 313 615)
(1 264 217)
1 774 527
(2 675 622)
26 198 418
22 563 613
Increase (Decrease) in deferred income
Cash generated from operations
69
2012
Revised 2011
R
R
19. Financial instruments
Overview
The Playhouse Company has exposure to the following risks from its use of financial instruments.
• Credit risk
• Liquidity risk
• Market risk
• Interest rate risk
This note presents information about The Playhouse Company’s exposure to each of the above risks, The Playhouse Company’s
objectives, policies and processes for measuring and managing risk, and The Playhouse Company’s management of capital.
Further quantitative disclosures are included throughout these financial statements.
In terms of Treasury Regulations 27.2.1, issued in terms of the PFMA, the accounting authority (Council) must ensure that a risk
assessment is conducted regularly to identify emerging risks in the entity. The Council has established the audit and governance
committee which is responsible for developing and monitoring The Playhouse Company’s risk management policies.
The Playhouse Company’s risk management policies are established to identify and analyse the risks faced by The Playhouse
Company, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and
systems are reviewed regularly to reflect changes in market conditions and The Playhouse Company’s activities. The Playhouse
Company, through its training and management standards and procedures, aims to develop a disciplined and constructive control
environment in which all employees understand their roles and obligations.
The audit and governance committee overseas how management monitors compliance with The Playhouse Company’s risk
management policies and procedures and reviews the adequacy of the risk management framework in relation to the risks faced
by The Playhouse Company. The audit and governance committee is assisted in its oversight role at operations level by Internal
Audit. Internal Audit undertakes both regular and ad hoc reviews of risk management controls and procedures, the results of which
are reported to the audit and governance committee.
Credit risk
Credit risk is the risk of financial loss to The Playhouse Company if a customer or counterparty to a financial instrument fails to
meet its contractual obligations and arises principally from The Playhouse Company’s receivables from customers.
The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk at 31
March 2012 was :
Trade and other receivables (note 13)
70
3 565 052
889 469
2012
Revised 2011
R
R
The Playhouse Company's exposure to credit risk is influenced mainly by the individual characteristics of each customer. The
composition of The Playhouse Company's customer base, including the default risk of the industry and country in which the
customers operate, has less of an influence on credit risk.
The majority of other receivables and accruals relates to interest income receivable from financial institutions for monies invested
in fixed deposits.
The trade debtors comprise monies outstanding for the services as follows:
• Truck hire - deposits or order numbers are received before the truck is hired out for cultural events
• Rental - deposits are held from tenants.
• Recording studio - 100% of fees are received in advance
• Function venue hire - deposits are received in advance
• Costume/props/wigs hire - fees are received before items are hired out
• Ticket sales - monies are received from sales at the door or through Computicket
The Playhouse Company policy is to monitor its exposure to credit risk on a monthly basis. At year end, the maximum exposure to
credit risk is represented by the carrying amount of each financial asset.
The calculation for the fair valuing of trade and other receivables is performed, however, the adjustment is not processed as the
adjustment amount is not material.
Analysis of trade and other receivables for reporting purposes:
90 days and over
50 499
79 989
60 Days
13 338
19 845
30 Days
42 607
40 925
3 458 608
748 710
3 565 052
889 469
Current
Investments
The Playhouse Company limits its exposure to credit risk by investing only in liquid securities and only with approved banks and
financial institutions.
Guarantees
The Playhouse Company's policy is to provide financial guarantees only for specified services.
The guarantees in issue as at 31 March 2012 were as follows:
eThekwini municipality for services - R 277 816
The postmaster for services - R 30 360
The guarantees will expire on 31 December 2025 and will not be renewed.
Liquidity risk
Liquidity risk is the risk that The Playhouse Company will not be able to meet its financial obligations as they fall due. The
Playhouse Company's approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to
meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage
to The Playhouse Company's reputation.
The Playhouse Company makes payments weekly. An assessment is made of the payments due in advance. Monies are
transferred to the current account to meet the weekly obligations. Any surpluses are invested on a month to month basis at the
most optimum rate.
It is the policy of The Playhouse Company, in line with the National Department of Arts, Culture and Tourism not to borrow monies.
There are thus no credit facilities available.
The cash available at 31 March 2012 was R68 396 129 (2011 - R55 296 109)
71
2012
Revised 2011
R
R
19. Financial instruments (Cont...)
Market risk
Market risk is the risk that changes in market prices, such as the interest rates will affect The Playhouse Company’s income.
The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while
optimizing return.
The Playhouse Company policy, in line with the National Department of Arts, Culture and Tourism is to invest surplus cash.
Optimal rates and periods are received from various institutions. A proposal is made and approved by senior management.
Due to the volatility in the interest rate at year end, monies were invested on month to month basis to take advantage of the monthly
increases in interest rates.
Currency risk
The Playhouse Company does not engage in foreign currency transactions and is thus not exposed to this risk
Interest rate risk
It is the policy of The Playhouse Company, in line with the National Department of Arts, Culture and Tourism not to borrow monies.
There are thus no credit facilities available. There is thus no risk relating to changes in the interest rate.
The Playhouse Company policy, in line with the National Department of Arts, Culture and Tourism is to invest surplus cash. Optimal
rates and periods are received from various institutions. A proposal is made and approved by senior management.
Due to the volatility in the interest rate at year end, monies were invested on month to month basis to take advantage of the monthly
increases in interest rates.
Profile:
Variable rate instrument
2012
Int Rate %
2011
Carrying amount
FNB - 60 days
5.50
FNB - 120 days
5.62
Investec - 90 day fixed
5.62
1 500 000
Investec - 120 day fixed
5.66
Nedbank - 120 day fixed
ABSA - 120 day fixed
Int Rate %
Carrying amount
5.50
2 000 000
5.60
8 500 000
16 500 000
5.63
14 000 000
5.65
18 000 000
5.62
13 000 000
5.65
9 000 000
5.63
12 900 000
5.58
3 000 000
13 500 000
RMB - 120 day
58 500 000
53 400 000
At 31 March 2012, if interest rates at that date had been 100 basis points higher or lower, with all other variables held constant,
profits would have increased or decreased by R 585 000.
At 31 March 2012, the carrying amounts of cash and cash equivalents, trade receivables and trade and other payables approximate
their fair values due to their short term maturities. Trade receivables and payables will mature within 30 to 60 days.
Fair values
The fair values of financial assets and liabilities are the same as the carrying values reflected in the balance sheet.
20. Tax exemption
The Playhouse Company is exempt from taxation in terms Section 10 (1)(cA)(I) of the Income Tax Act.
72
2012
Revised 2011
R
R
21. Emoluments - Senior management and council
Senior management
L Bukhosini - Chief executive and artistic director
1 309 723
1 212 007
Salary
1 047 978
965 879
Bonus
87 332
80 490
172 916
159 370
1 497
6 268
A Mohanparasadh - Chief financial officer
889 805
733 018
Pension and med-aid contributions
Cell phone and other
Salary
789 650
699 067
Bonus
65 804
30 325
Acting allowance and other
34 351
3 626
O Hlangu - Support services manager
777 255
716 283
Salary
568 227
523 712
Bonus
Pension and med-aid contributions
Acting allowance and other
Total senior managers
Members of council and subcommittees
M Lesoma
R Ashe
LS Sibisi - external independent member
47 352
43 643
108 320
99 873
53 356
49 055
2 976 783
2 661 308
84 402
41 330
1 082
4 328
10 000
2 082
-
1 666
TS January Maclean
4 572
-
S Naidoo
8 262
-
L Theron*
M Rajab
MI Mlambo
4 551
4 525
10 046
11 765
6 426
-
T Shezi
7 318
6 335
NM Nala
6 426
-
J Thabethe
1 810
4 525
TSS Ngcobo
4 577
3 620
S Naidoo
8 262
-
S Gounden
7 344
-
M Mvulane - external independent member
3 726
2 484
3 061 185
2 702 638
Total Emoluments
* Permission obtained from Minister of Justice to receive fees and allowances.
22. Retirement benefits
Permanent employees participate in pension and provident funds established for the Performing Arts Companies of South Africa or
a Provident Fund established by South African Commercial Catering and Allied Workers Union. The Pension and Provident Funds
are governed by the Pensions Fund Act. The Provident Funds are defined contribution plans and do not require periodic actuarial
valuations.The contribution to the pension funds during the year was R0 (2011: R430 448), provident funds R2 109 326 (2011: R1 855
494) and is included in staff cost.
73
2012
Revised 2011
R
R
23. Related parties
23.1 National Department of Arts and Culture.
Grants received for the financial year amounted to R 62 266 646, and for the year ended 2012/13 will amount to
R 38 488 000.
23.2 KZN Department of Arts, Culture and Tourism
Grant received for the 2011/12 financial year amounted to R6 401 000 was received in biannual instalments.
23.3 eThekwini Municipality
A total transfer payment of R3 043 562 is recorded as income for the current year, R2 315 214 accrued plus R728 348 deferred
in the previous financial year. The EThekwini Municipality and The Cultural Institution were busy with negotiations for the
March 2012 grant as at 31st March 2012.
23.4 Department of Public Works
The department is the legal owner of the Land and Buildings occupied by The Playhouse Company and The Playhouse
Company leases the property at no charge.
23.5 Council
The Council has been appointed by the Minister of Arts and Culture to oversee and ensure corporate governance. Council
has various subcommittees such as finance, audit and governance and human resources that guide and assist management
which is appointed by Council. Refer note 21 - compensation.
Mr Rajab is a member of the council of The Playhouse Company. Mr Rajab`s wife, Dr Devi Rajab, undertook a standard InAssociation production called DR D Rajab Durban Book Launch . All related costs were paid by Dr Devi Rajab.
23.6 Transnet Truck
The Playhouse Company and the Transnet Foundation entered into a joint venture in providing a fully equipped mobile stage.
The Transnet Foundation has provided The Playhouse Company with the use of a Truck Trailer, Pantechincon Semi Trailer and
sound equipment. The Transnet Foundation maintains and services the truck trailer and semi trailer.
The Playhouse Company is responsible for costs of tyres, oil, insurance and general up keep of the truck and staff. All
proceeds and income from the use of the truck accrue for the sole benefit of The Playhouse Company.
23.7 Kwazulu Natal Philharmonic Orchestra - KZNPO
On 1 April 1998, The Playhouse Company reduced its operational size in line with the principles contained in the Department
of Arts, Culture, Science & Technology White Paper. The restructuring exercise was driven by two main objectives: to eliminate
the budgeted deficit and to implement strategies to avoid future deficit scenarios. One of the ways of reducing the expenditure
was by registering the KZNPO as a non-profit independent Section 21 Association Not for Gain Entity. As a result of this
transformation, the two organisations agreed to enter into a mutual benefit relationship.
A Memorandum of Agreement exists between The Playhouse Company and KZNPO. This agreement includes the following:
a. Occupying a portion of The Playhouse Company’s administration building.
b. Access to finance and human resources services for which they are invoiced.
c. As part of the restructuring process in 1999 assets (orchestral equipment, scripts and scores) with an original cost of
R328 739 were transferred to the KZNPO at a nil value.
d. The Playhouse Company receives a discounted rate for the artistic services offered by the Orchestra to The Playhouse
Company.
The Playhouse Company engaged the services of the Orchestra for numerous performances. During the year under review a
discounted total of R3 223 250 (2011: R0) was paid and R0 (2011: R667 698) accrued to the KZNPO for these performances.
An amount of R298 030, (2011: R363 421) was paid by KZNPO for services rendered by The Playhouse Company.
The KZNPO is the only professional orchestra in Kwa-Zulu Natal to render such services. It is cost effective to utilise a locally
established entity thus eliminating unnecessary exorbitant transport and accommodation costs.
The Chief Executive Officer of the KZNPO is married to the Chief Executive Officer of The Playhouse Company.
74
2012
Revised 2011
R
R
23.8 Artist Fees
During the year under review, national auditions were held for the musical production of Cinderella. After rigorous, transparent
and fair audition processes, Miss Nondumiso Tembe successfully auditioned as part of this production. This award winning
singer-actress is the daughter of the CEO of The Playhouse Company. An amount of R162 857 was paid as fees for work
performed over a 3 month period during the run of the production.
23.9 Management
Mr O Hlangu is the support services Manager of The Playhouse Company. He is also the Chairman of the Technical Direction
Corporation of Africa (Pty) Ltd. During the period April 2011 to March 2012 an amount of R1 798 900 (2011: R 0) was paid by
The Playhouse Company to the Technical Direction Corporation of Africa (Pty) for the purchases of sound equipment.
23.10 Key Personnel
•
Chief executive and artistic director - Linda Bukhosini
•
Chief financial officer - Amar Mohanparasadh
•
Support services manager - Oscar Hlangu
24. Events after reporting date
The memorandum of agreement for the 31 March 2012 grant with eThekwini municipality was finalised between the financial
performance date and date of this report. The Playhouse Company has accrued for the grant income for the period ended 31
March 2012.
25. Irregular, fruitless or wasteful expenditure
No material losses through criminal conduct, or irregular, fruitless or wasteful expenditure were incurred during the year ended
31 March 2012.
26. Non-cancellable committed tenders
At the financial performance date The Playhouse Company had outstanding commitments in respect of non-cancellable
tenders awarded during the year.
The tender awards are as follows:
Building alterations & additions (2nd phase of compliance)
2 844 147
External remedials - Mayville
5 075 460
Hvac upgrade - Mayville
1 962 898
Alhambra room - renovations
2 256 060
Acoustic treatment - Grand foyer
779 245
Total committed liabilities
12 917 810
27. World cup expenditure
Purchase of Other World Cup Apparel
Qty
T- Shirts
100
Total world cup expenditure
2012
2011
-
17 000
-
17 000
28. Comparative figures
The changes in accounting policy (note 2) relating to the recognition of heritage assets resulted in the 2011 and prior years
trading results being restated. The annual financial statements discloses this as “Revised 2011” financial information.
75
29. Reconciliation between budget and statement of financial performance
2012
Revised
2011
R
R
24 809 554
25 826 062
2 641 319
2 240 000
-
(280 000)
Increase in sponsorship for the staging of productions
(1 091 600)
(446 000)
Increase in production income
(1 044 300)
-
Increase in insurance claims
(261 000)
-
Increase in liquor bar and sundry income
(225 000)
(352 000)
Increase in finance income
(123 313)
(247 000)
Decrease in production cost
(1 572 100)
(2 290 000)
Decrease in compensation to employees as certain positions not filled
(1 217 400)
(2 100 000)
(409 700)
(3 798 000)
(13 000)
(90 000)
Decrease in audit fees
(632 760)
-
Decrease in security costs
(502 800)
-
Decrease in repairs and maintenance
(2 304 800)
-
Decrease in other operating expenses
(2 085 128)
(2 276 861)
-
(5 500)
8 088 936
7 245 000
Capital expenditure budgeted but not processed to statement of financial
performance
(48 382 787)
(39 516 430)
Net deficit per approved budget (including capex)
(24 325 879)
(19 035 061)
Net surplus per the statement of financial performance
Adjusted for:
Decrease in capital works grant from DAC
Increase in Lotto grant received
Decrease in consumables, repairs & maintenance, electricity and security
Decrease in training costs
Fair value adjustments
Depreciation
76
123RD INTERNATIONAL OLYMPIC COMMITTEE‘S SESSION
77
29.1 Reconciliation between budget and statement of financial performance - operating expenditure
STATEMENT OF FINANCIAL PERFORMANCE - ACTUAL VERSUS BUDGET - 2012
ACTUAL
ORIGINAL
BUDGET
REVISED
BUDGET
VARIANCE
R 000
R 000
R 000
R 000
REVENUE
81 112 550
78 859 730
80 421 235
691 315
Grants
71 711 208
74 595 752
74 395 752
(2 684 544)
Production Income
3 424 305
2 380 000
2 380 000
1 044 305
Donations and sponsorships
2 643 161
-
1 551 505
1 091 656
Rent received
653 365
600 000
600 000
53 365
Hire of performance venues, costumes and sets
979 539
735 000
735 000
244 539
Box office commission - external productions
133 130
-
-
133 130
Bar and other sales
544 965
320 000
320 000
224 965
Sundry income
1 022 877
228 978
438 978
583 899
EXPENDITURE
59 753 946
54 258 275
59 671 326
(82 620)
Production costs
12 709 045
11 229 650
14 281 155
1 572 110
Employee related costs
22 276 943
23 468 975
23 494 372
1 217 429
Annual report
70 327
80 000
80 000
9 673
Auditors fees external
409 286
900 000
1 000 000
590 714
Auditors fees internal
267 943
250 000
310 000
42 057
Council related expenses
626 446
332 500
549 500
(76 946)
Cleaning and sanitation
1 004 820
1 093 000
1 148 000
143 180
Consumables
1 352 685
1 403 750
1 762 451
409 766
Electricity
2 598 924
2 359 000
2 670 227
71 303
Security
2 497 261
3 000 000
3 000 118
502 857
312 584
290 000
313 000
416
12 630
100 000
100 000
87 370
Marketing
1 404 445
1 003 000
1 503 000
98 555
Repairs & maintenance
2 475 764
4 588 000
4 780 548
2 304 784
Telephone
343 942
479 750
420 400
76 458
Training
325 992
350 000
339 000
13 008
Travel - local and overseas
353 710
372 000
507 000
153 290
Water
277 091
299 000
317 000
39 909
Insurance
Legal expenses
Depreciation
8 088 936
-
-
(8 088 936)
General expenses
2 345 172
2 659 650
3 095 555
750 383
21 358 604
24 601 455
20 749 909
608 695
3 450 950
2 506 000
3 306 000
144 950
24 809 554
27 107 455
24 055 909
753 645
Surplus from operations
Interest received
78
VARIANCE
Explanation of significant variance
%
-4%
Capital expenditure grant recognised in terms of accounting policy.
44%
The box office takings for the year end production exceeded original expectations.
70%
Sponsorship income received in respect of COP 17 event.
9%
33%
100%
70%
Rental income exceeded budget due to additional premises rented out.
R247 000 was generated from Rehearsal studio hire that was not budgeted.
This is not budgeted for as there is no definite way to determine its value upfront. It is dependent on the ticket sales for
all productions.
There was exceptional support for this service during the year.
133%
Income from events and functions of R62 000 was not budgeted. Insurance claims amounted to R441 000. Tender
sales exceeded budget by R38 600 due to the increase in Capex projects.
11%
The community arts festivals and the schools productions commenced in March 2012 and rolled over to the new year.
The corresponding expenses will thus be rolled over to the new year.
5%
12%
The number of reports printed was decreased in line with the guidance from National Treasury.
59%
Cost to be incurred in the next financial year.
14%
-14%
Follow up audit to be performed in the new financial year.
The ISPA conference was attended by an additional council member who could not attend in the previous year.
12%
Savings as a result of cost saving initiatives.
23%
The efficiency of the new aircon system in the theatre complex resulted in R 130 000 savings in aircon consumable
items. Savings in other consumables are in line with cost saving initiatives.
3%
17%
The installation of the CCTV camera’s were deferred to the new year due to the renovations that were in progress.
0%
87%
There were no material legal matters during the year thus resulting in a savings.
7%
An increase in publicity secured and partnerships and sponsorships with media houses resulted in a reduction in the
marketing expenses.
48%
There was an urgent unforeseen need to replace the Alhambra Roof at an estimated cost of R 3 million. An application
was made to DAC, but in the interim the work had to be done. Certain repairs and maintenance were put on hold until
DAC approval was received for the R3 million.
18%
4%
30%
Savings in local travel and accommodation arising from cost saving initiatives.
13%
100%
24%
4%
Not budgeted for annually.
R 500 000 contingency reserve budgeted and not utilised. Savings in various expenses items due to cost saving
initiatives.
Funds optimally invested with banks providing best rates of returns.
79
29.2 Reconciliation between budget and statement of financial performance - capital expenditure
FIXED ASSET ADDITIONS - ACTUAL VERSUS BUDGET 2012
ACTUAL
R 000
ORIGINAL
REVISED
BUDGET
BUDGET
R 000
R 000
VARIANCE
VARIANCE
R 000
%
Office equipment
126 762
148 000
148 000
21 238
14%
Computer equipment
462 404
387 000
516 411
54 007
10%
Transport
532 768
645 265
112 497
17%
Stage equipment
5 044 658
9 700 000
13 091 041
8 046 383
61%
Buildings
10 406 756
19 370 000
33 982 070
23 575 314
69%
Total
16 573 348
29 605 000
48 382 787
31 809 439
66%
80
Explanation of significant variance
Capital expenditures put on hold and deferred to the new financial year.
Server upgrade process commenced at the end of March and was completed in the new financial year. Final
costs were paid in the new financial year.
Savings arising from negotiating better prices with suppliers.
Contracts have been awarded but not yet completed. Final payments to be made in the next financial year.
Contracts have been awarded but not yet completed. Final payments to be made in the next financial year.
81
HUMAN RESOURCES
PERSONNEL COSTS
Total Expenditure
Personnel
Expenditure
Training
Expenditure
Consultancy
Services
Personnel Costs
as a % of Total
Expenditure
Average
personnel cost
per employee
59 753 946
22 236 657
325 992
41 163
37.21%
249 850
SALARIES, OVERTIME, HOUSING SUBSIDY, MEDICAL ASSISTANCE, PENSION/PROVIDENT CONTRIBUTIONS, OTHER
ALLOWANCES AND LEAVE GRATUITIES
Salaries
Amount
Overtime
Amount
Housing
Allowance
Medical
Assistance
Pension/
Provident
Fund
Other
Allowances
Ad-hoc
payments
Leave
Gratuities
15 574 878
201 728
288 564
525 274
2 109 326
1 628 428
1 380 820
527 639
Type of post
Number of posts
Permanent
Adhoc /Fixed Term contracts
Number of posts filled
Vacancy rate
94
85
11%
0
2
-
ANNUAL TURNOVER RATE
Occupational level
Number of
employees as
at 01 April 11
Appointments
and transfers
into the
institution
Terminations
and transfers
out of the
institution
Turnover rate
Contracts on
Permanent
Positions
Total number
as at March
2012
Senior Management
2
0
0
0%
0
2
Professionaly qualified
and experienced
specialists and mid
management
9
2
0
0%
0
11
Skilled technical
and academically
qualified workers,
junior management,
supervisors, foreman
and superintendents
25
7
6
23%
0
26
Semi skilled and
discretionally decision
making
47
1
2
4%
0
46
Unskilled and defined
decision - making
0
0
0
0%
0
0
83
10
8
9.4%
0
85
Total
82
REASONS WHY STAFF MEMBERS ARE LEAVING THE INSTITUTION
Termination type
Number
% of total
Death
0
0%
Resignation
5
62.5%
Expiry of Contract
1
12.5%
Dismisal; operational changes
0
0%
Dismisal; misconduct
0
0%
Dismisal; in-efficiency
0
0%
Discharged due to ill-health
2
25%
Retirement
0
0%
Other
0
0%
Total number of employees who left
8
100%
Total number of employees who left as a % of the total employment
-
8.5%
EMPLOYMENT EQUITY
Post level
Male
African
Coloured
Female
Indian
White
African
Coloured
Total
Indian
White
Top Management
0
0
0
0
1
0
0
0
1
Senior Management
0
0
1
0
0
0
0
0
1
Professionaly
qualified and
experienced
specialists and mid
management
2
0
1
4
2
0
1
1
11
Skilled technical
and academically
qualified workers,
junior management,
supervisors, foreman
and superintendents
13
1
2
4
4
0
1
1
26
Semi skilled and
discretionally decision
making
26
0
4
1
7
0
4
4
46
Unskilled and defined
decision - making
0
0
0
0
0
0
0
0
0
Total Permanent
Employees
41
1
8
9
14
0
6
6
85
Non-permanent
employees
2
0
0
0
0
0
0
0
2
43
1
8
9
14
0
6
6
87
Total
83
HuMAn RESOuRCES (COnT..)
LABOUR RELATIONS
Number
Type of Misconducts
Number
Outcomes of Diplinary Hearings
Misconduct and Disciplinary hearings Finalised
0
-
0
Final Written Warnings
2
Unauthorised possession of Co. property
2
Dismissals
0
-
0
Total
2
-
2
TRAINING NEEDS IDENTIFIED 01 APRIL 2011 TO 31 MARCH 2012
Gender
Number of
employees as at
01 April 2011
Training needs idenfied at start of reporting period
Learnerships
Skills programmes
and other short
courses
Other forms of
training (voluntary)
Total
Male
59
0
37
10
47
Female
26
0
32
1
33
Total
85
0
69
11
80
84
GLOSSARY
AAP
Annual Arts Programme
AFS
Annual Financial Statement
ATM
Automatic teller machine
CAPEX
Capital expenditure
CD
Compact Disk
CEO
Chief Executive Officer
CFO
Chief Financial Officer
Co
Company
COP17
Conference of Parties
COSATU
Congress of South African Trade Unions
DAC
Department of Arts and Culture
DIRCO
Department of International Relations and Cooperation
DVD
Digital Video Disk
FINCO
Finance Committee
FNB
First National Bank
GAAP
Generally Accepted Accounting Practises
GRAP
Generally Recognised Accounting Practices
HIV
Human immunodeficiency
HR
Human resource
HVAC
Heating, ventilating and air conditioning
IOC
International Olympics Committee
IT
Information Technology
KZN
KwaZulu-Natal
KZNPO
KwaZulu-Natal Philharmonic Orchestra
M
Million
MOA
Memorandum of agreement
PFMA
Public Finance Management Act No.1 of 1999
RAD
Royal Academy of Dance
RMB
Rand Merchant Bank
RMB
Rand Merchant Bank
SASCOC
South African Sports Confederation and Olympics Committee
SCM
Supply Chain Management
UIF
Unemployment Insurance Fund
85

Annual Report 2011/2012

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