ANNUAL - KZN Liquor Authority
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
full colour logo
ANNUAL
REPORT
2018/2019
greyscale logo
“TO POSITION black and white ‘fax frien
THE AUTHORITY AS A LEADING,
DISTINGUISHED AND EFFECTIVE LIQUOR
REGULATOR IN THE COUNTRY”
1
K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
VISION
To position the Authority as a leading,
distinguished and effective Liquor
Regulator in the country
MISSION
To ensure strict regulation and control of the
retail sale and micro – manufacturing of liquor in
the Province of KwaZulu-Natal through effective
policies, strategies and partnerships
VALUES
• Accountability • Fairness
• Integrity • Efficiency
• Responsiveness • Progressiveness
• Transparency
The KwaZulu-Natal Liquor Authority (KZNLA), listed as a Schedule 3c Public Entity in terms
of the PFMA. The KZNLA, was established in terms of the KwaZulu-Natal Liquor Licensing
Act, (Act no. 06 of 2010). The KZNLA has organisational presence in each of the Municipal
Districts in the Province. The District Offices are staffed by fewer teams as compared to
the head office, comprising of a District Social Responsibility Practitioner, an Inspector/s
and a Local Committee Secretary. The District offices have enabled the organisation to
effectively perform its mandate and ensure ease of access to its stakeholders, and critically
the public.
2
K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
CONTENTS:
MEC’S FOREWORD ...............................................................................................................................4
ACRONYMS .............................................................................................................................................6
PART A: GENERAL INFORMATION .................................................................................................7
CHAIRPERSONS STATEMENT ...........................................................................................................9
BOARD OF DIRECTORS .................................................................................................................... 11
CHIEF EXECUTIVE OFFICER’S REPORT....................................................................................... 15
STATEMENT OF RESPONSIBILITY ................................................................................................ 17
PERFORMANCE INFORMATION ................................................................................................... 18
EXECUTIVE MANAGEMENT TEAM .............................................................................................. 19
HUMAN RESOURCES OVERSIGHT STATISTICS ...................................................................... 24
GOVERNANCE REPORT ................................................................................................................... 27
AUDIT AND RISK COMMITTEE ..................................................................................................... 28
HUMAN RESOURCES AND REMUNERATION COMMITTEE .............................................. 30
FINANCE COMMITTEE .................................................................................................................... 31
SOCIAL AND ETHICS COMMITTEE ............................................................................................. 32
BOARD’S ADJUDICATION COMMITTEE ................................................................................... 33
AUDIT REPORT .................................................................................................................................... 34
REPORT OF THE AUDITOR GENERAL ........................................................................................ 36
ANNUAL FINANCIAL STATEMENTS ............................................................................................ 39
3
K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
MRS N DUBE-NCUBE, MPL
MEC: ECONOMIC DEVELOPMENT, TOURISM
AND ENVIRONMENTAL AFFAIRS
MEC’S FOREWORD
Alia Bhatt once said: “Whatever you do, do with Enforcement inspectors will continue to develop
determination. You have one life to live; do your collaborative relationships with law enforcement
work with passion and give your best. Whether agencies and other government departments to
you want to be a chef, doctor, actor, or a mother, ensure compliance and closure of mushrooming
be passionate to get the best result.” illegal outlets. Effective and efficient service
delivery, coupled with customer care and service
As I embark on my journey as the new MEC for the excellence cannot be over emphasized.
Department of Economic Development, Tourism
and Environmental Affairs, I am confident, I maintain that while the legislative mandate of
eager and enthusiastic of the work and service the KZNLA is to control the retail sale and micro-
delivery of the KwaZulu-Natal Liquor Authority. manufacturing of liquor in the Province, it is
The entity, since its inception in 2012 and the extremely vital and important that we continue
commencement of the current Liquor Act (Act 06 to educate and raise awareness of the dangers
of 2010), has made tremendous strides in ensuring of binge drinking, underage liquor consumption
a seamless transaction and a transparent and fair and drinking and driving. To ensure the emphasis
liquor application process. of this, the need for a collaborative relationship
between us in the public sector, the private sector
I am quite determined to take and carry the baton and communities is of extreme significance.
of success and hard work from my predecessor and
now Premier of KwaZulu-Natal, Mr Sihle Zikalala. Ensuring compliance and enforcement of the
Under his vigorous leadership, the Department liquor Act is critical and important if the KZN Liquor
and its Entities has ensured visibility throughout Authority wishes to remain relevant and credible.
the Province and continued to prioritize service I am exuberant of the strides and approach the
delivery. Entity has taken in ensuring it prioritizes on
service delivery, education and awareness. With
While the liquor business continues to contribute the support of communities and law enforcement
towards the provinces and country’s economy, agencies who are expected to play an integral
it is equally as important to recognize that these role in the District Liquor Forums, I am looking
businesses have a responsibility of ensuring proper forward to a healthy relationship between the
and compliant trade. Sale of alcohol to pregnant Liquor Industry players on the one hand and the
women and underage pupils; drunk driving and Liquor Forum on the other. Various hindrances
sale of alcohol to drunk and intoxicated patrons and challenges have the potential to be attended
must be prevented at all costs. to, dealt with and dispensed at a District level.
Effective compliance and enforcement of the This can only happen and manifest if the
Liquor Act continue to become a top priority for relationship with key stakeholders are built on
the KZN Liquor Authority. Our Compliance and trust and confidence. I can only hope and trust
4
K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
that the KZN Liquor Authority has made great adhere to the Bato-Pele principles of putting
advances in developing strategic relationships people first. I also look forward to working closely
with a number of stakeholders in furtherance of with the Entity’s Board of Directors with whom, I
its objectives. am confident we will build a formidable working
relationship that will move the entity forward and
I cannot, again, further emphasize the importance maintain its high level status.
of service delivery and pursuing the province’s
commitment of radical, social and economic
transformation. The introduction of the new
Liquor Management System (eLMS) is testament
that the KZN Liquor Authority is taking huge
strides in bettering and developing its liquor
application system. The system promises great
advancement in the entire approach and liquor
licensing process. The approved Marketing and
Communications Strategy also seeks to mould,
shape and introduce more practical and free
flowing communication channels with the public
and our stakeholders.
_________________________________________
In conclusion, I would like encourage staff,
Executive and Management team to continue MS NOMUSA DUBE-NCUBE, MPL
to work hard and fly the entity’s flag high. Let us MEC: KWAZULU-NATAL ECONOMIC DEVELOPMENT,
work together in improving service delivery and TOURISM AND ENVIRONMENTAL AFFAIRS
5
K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
ACRONYMS:
AG AUDITOR GENERAL
CEO CHIEF EXECUTIVE OFFICER
CFO CHIEF FINANCIAL OFFICER
EDTEA DEPARTMENT OF ECONOMIC DEVELOPMENT, TOURISM AND ENVIRONMENTAL AFFAIRS
HR HUMAN RESOURCES
IT INFORMATION TECHNOLOGY
KZNLA KWAZULU-NATAL LIQUOR AUTHORITY
LMS LIQUOR MANAGEMENT SYSTEM
MEC MEMBER OF THE EXECUTIVE COUNCIL
MTEF MEDIUM TERM EXPENDITURE FRAMEWORK
NGO NON GOVERNMENT ORGANISATION
SALGA SOUTH AFRICAN LOCAL GOVERNMENT ASSOCIATION
LLS LIQUOR LICENSING SYSTEM
6
K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
PART A:
G E N E R A L I N F O R M AT I O N
7
K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
GENERAL INFORMATION:
REGISTERED OFFICE: Sector, collaborative relationship with the liquor industry and
1st Floor, The Marine Building, 22 Dorothy Nyembe Street the community are required. The Authority understands that
(Gardiner Street), Durban, 4000 public, private and community partnerships are critical for the
organisation to remain relevant and effective.
POSTAL ADDRESS: Key Stakeholders include:
P.O Box 2853, Durban, 4000
• Government Departments (National, Provincial and Local);
AUDITORS: • District and Local Municipalities
External – Auditor General • NGO’s, Liquor Traders and Liquor Trader Associations
Internal - NEXIA-SAB&T
• Liquor Manufacturers and Distributors
BANKERS: • Law Enforcement Agencies
ABSA Bank, KZN Provincial Banking Branch • Justice Cluster and Other Cabinet Clusters
• Media
STATUTORY AND LEGISLATIVE MANDATE OF THE
• Existing Community Structures
KWAZULU-NATAL LIQUOR AUTHORITY
The mandate of the KwaZulu-Natal Liquor Authority is to • National and Provincial Liquor Authorities
ensure that the objectives of the KZN Licensing Act are • Suppliers/Service Providers
accomplished. The KZN Liquor Licensing Act lists the following
as objectives:
STRATEGIC GOALS OF THE KZN LIQUOR AUTHORITY
• To provide for the regulation of the micro-manufacturing The following key strategic goals are required to give effect
and retail sale of liquor; to the statutory mandate and strategic objectives of the KZN
• To reduce the socio-economic and other costs of alcohol Liquor Authority. These strategic goals and objectives serve
abuse; over the Medium Term Expenditure Framework (MTEF) period
• To provide for public participation in the consideration of to enable KZNLA to achieve on its mandate.
applicants for registration; and
STRATEGIC GOALS
• To promote the development of a responsible and
sustainable retail and micro-manufacturing liquor 1. To provide for an effective regulatory environment
industry in a manner that facilitates: 2. To implement effective corporate governance processes in
- The entry of new participants into the industry; the Liquor Authority
- Diversity of ownership in the industry; and 3. To develop and implement an effective communications
strategy for the organisation
- An ethos of social responsibility in the industry
4. To attract, nurture and retain skills within the organisation
STAKEHOLDER ANALYSIS 5. To implement sound financial management and effective
The KZN Liquor Authority identified a number of key and reliable information management systems
stakeholders, and has furthermore, through its District
6. To implement an effective liquor licensing process
Offices, has established strategic relationships with these
critical stakeholders, for the purpose of ensuring the key 7. To ensure compliance with the Liquor licensing legislation
objectives of the organisation are achieved. The organisation 8. To advocate for an informed, efficient and seamless liquor
acknowledges that for the success and sustainability of the regulatory environment
8
K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
MS M P MYENI
CHAIRPERSON: BOARD OF DIRECTORS
CHAIRPERSONS STATEMENT
The year under review presents and has been During the year under review, the Liquor
quite challenging and immensely rewarding in Authority has introduced and is implementing
many aspects. The Entity has faced and endured a new Marketing and Communications
many challenges and obstacles, but it is our Strategy to better ensure communication and
sheer determination and perseverance that has transparency with our stakeholders, public
ensured that we as an Entity prevail at all times. and license holders and applicants. Our new
Licensing Management System (LMS) will and is
In our continuous quest of adhering to the
contributing tremendously in fast-tracking the
KwaZulu-Natal Liquor Act (Act 06 of 2010)
Liquor licensing process.
and upholding to our mandate of properly
regulating and controlling the retail sale and We concede that the abuse of liquor continues
micro-manufacturing of liquor in Province of to be a major contributory factor to many
KwaZulu-Natal, the KZN Liquor Authority has unnecessary deaths and acts of violence in
continued to grow in leaps and bounds in the our country and the Province. All of us are
purse of full compliance with the Act through concerned about the devastating effects that
the operations of various Business Units and alcohol abuse has on the individual, family,
stakeholder engagements. community and the nation. It is with these
reasons that we not only prioritize on the liquor
I euphorically applaud the KZNLA Board of
licensing application alone, but in forging and
Directors who have continued to steer and
maintaining a stable social environment that
direct the Entity in a route and manner befitting
is aware and educated on excessive liquor
of a role model regulator. Each Business Unit
consumption and binge drinking.
has also fostered and developed strong multi-
sectorial stakeholder relations with various We are also keenly aware of the social ills
government institutions, private sector and law plaguing the Province and country as a direct or
enforcement agencies to execute its mandate indirect consequence of alcohol – we therefore
through synergised operations. continue to ensure full compliance and proper
regulation of the liquor product. As a regulator,
The introduction of various initiatives,
our duty therefore entails seeking a balance
programmes and innovative ideas, is testament
of the socio-economic impact of alcohol and
of the Entity’s willingness and eager to change
its effects and continue to pursue and strive
lives, raise awareness on the dangers and
towards proper regulation.
hazards of excessive alcohol consumption and
ensuring a seamless license application process.
9
K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
Effective compliance and enforcement of and guidance during the year under review.
the Liquor Act must continue to become Executive, Management and staff of the KZN
a top priority for the Liquor Authority. Our Liquor Authority cannot and will not be left
Compliance and Enforcement Inspectors will unrecognised - their willingness to go beyond
continue to develop collaborative relationships the call of duty has grown, shaped and moulded
with law enforcement agencies in the quest of the Entity to what it is today. Let us all continue
ensuring compliance and eradicating illegal to be at the public’s beck and call, and ensure
trade. Effective and efficient service delivery, that we continue to adhere to the Batho-pele
coupled with customer care and service principles and prioritize on service delivery.
excellence cannot be over-emphasized.
I also would like to applaud the efforts and
contribution of the newly elected MEC of
the Department of Economic Development,
Tourism and Environmental Affairs, Ms Nomusa
Dube-Ncube for her continuous prep and _________________________________________
encouragement in ensuring we maintain
our mandate. My sincere appreciation and MS. M.P. MYENI
gratitude is further extended to my fellow Board CHAIRPERSON: KZNLA’s BOARD OF DIRECTORS
members for their invaluable contribution
10K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
BOARD OF DIRECTORS:
MS M P MYENI MRS S PILLAY INKOSI M I TEMBE
CHAIRPERSON DEPUTY CHAIRPERSON MEMBER
DR C N KHUMALO MR M THANGO BRIG. KHESWA
MEMBER MEMBER MEMBER
PROF. B DUMISA MR S MKHIZE
MEMBER SHAREHOLDER REPRESENTATIVE
11K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
NAME DESIGNATION APPOINTMENT DATE
Board’s Chairperson 01 May 2017
Ms M P Myeni
Adjudication Committee Member 31 May 2017
Deputy Chairperson of the Board 31 May 2017
Ms S Pillay Adjudication Committee Member 31 May 2017
Chairperson Social and Ethics Committee 01 May 2017
Board Member 01 May 2017
Prof B Dumisa
Chairperson Board Adjudication Committee 31 May 2017
Board Member 01 May 2017
Dr C N Khumalo Chairperson Human Resources and Remuneration Committee 31 May 2017
Finance Committee Member 01 July 2018
Board Member 01 May 2017
Mr M Thango Chairperson Audit and Risk Committee 31 May 2017
Human Resources and Remuneration Member 31 May 2017
Board Member 01 May 2017
Inkosi M Tembe Chairperson Finance Committee 01 July 2018
Social and Ethics Committee Member 31 May 2017
Board Member 01 May 2017
Brigadier Kheswa
Social and Ethics Committee Member 31 May 2017
INDEPENDENT MEMBERS
Ms E Mcoyi Human Resources and Remuneration Member 01 May 2017
Mr S Hlophe Audit and Risk Committee member 20 July 2018
Mr D Mncwabe Audit and Risk Committee member 20 July 2018
EX-OFFICIO MEMBERS
MEMBER DESIGNATION
Mr E M Mashile Chief Executive Officer (Resigned)
Mr B B Mbanjwa Chief Financial Officer
Mr B Radebe Acting CEO
Mr S Mkhize EDTEA Representative
Ms N Thavar EDTEA Representative (Alternate)
BOARD/SPECIAL MEETINGS ATTENDANCE
MEMBER ‘18/04/24 ‘18/05/25 ‘18/07/20 ‘18/08/20 ‘18/09/03 ‘18/11/01 ‘18/12/04 ‘19/01/16
Special Special /21/22 Special Special
Ms M P Myeni
Ms S Pillay
Prof. B Dumisa A
DR C N Khumalo
Mr M Thango
Inkosi M Tembe A A A
Brigadier Kheswa AB AB A AB AB AB AB AB
Mr E M Mashile N/A R R R
Mr B B Mbanjwa N/A
Mr S Mkhize A N/A A A A N/A
Ms N Thavar N/A N/A N/A N/A N/A
= Attended A = Apology R = Resigned N/A = Not Applicable AB = Absent no Apology RR =Recused
12K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
BOARD/SPECIAL MEETINGS ATTENDANCE
MEMBER ‘19/03/14
Ms M P Myeni
Ms S Pillay
Prof B Dumisa
DR C N Khumalo
Mr M Thango
Inkosi M Tembe
Brigadier Kheswa AB
Mr E M Mashile R
Mr B B Mbanjwa
Mr B E Radebe
Mr S Mkhize
Ms N Thavar
Ms B Mapisa
HR AND REMUNERATION COMMITTEE
MEMBER DESIGNATION 2018/05/03 2018/05/16
Special 2018/08/02 2018/11/15 2019/03/05
Mrs C N Khumalo CHAIRPERSON
Mr M Thango Member
Ms F Mcoyi Member A
Mr E M Mashile CEO (Resigned) Ex officio N/A R R
Mr B B Mbanjwa CFO Ex officio N/A
Mr B Radebe Acting Ex officio N/A N/A N/A
AUDIT AND RISK COMMITTEE
MEETINGS ATTENDED
MEMBER DESIGNATION
2018/05/24 2018/07/27 2018/11/16 2019/02/18
Mr M Thango CHAIRPERSON
Mr T Zulu Independent Member RR R R R
Ms C Coetzee Independent Member R R R
Mr S Hlophe Independent Member N/A A
Mr D Mcwabe Independent Member N/A
Mr E M Mashile CEO Ex -officio R R
Mr B B Mbanjwa CFO Ex officio
Mr B Radebe Acting CEO N/A N/A
SOCIAL AND ETHICS COMMITTEE
MEETINGS ATTENDED
MEMBER DESIGNATION
2018/05/02 2018/08/02 2018/11/14 2019/03/04
Ms S Pillay CHAIRPERSON
Inkosi M Tembe Member
Brigadier Kheswa Member A AB AB N/A
Mr E M Mashile CEO Ex Officio R R
Mr B Radebe Acting CEO N/A N/A
13K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
FINANCE COMMITTEE
MEETINGS ATTENDED
MEMBER DESIGNATION
2018/07/26 2018/11/14 2019/03/04
Inkosi M Tembe CHAIRPERSON
Dr C N Khumalo Member
Mr E M Mashile CEO Ex officio R R
Mr B B Mbanjwa CFO Ex officio
Mr B Radebe Acting CEO N/A
BOARD’S ADJUDICATION COMMTTEE MEETING ATTENDANCE
‘18/10/30
MEMBER ‘18/04/20 ‘18/05/24 ‘18/06/29 ‘18/07/30 ‘18/08/28 2018/09/20 Objection ‘18/11/19
ilembe
Ms M P Myeni A
Ms S Pillay A
Prof B Dumisa
Mr M E Mashile A R R
Mr B Radebe N/A N/A N/A N/A N/A N/A
BOARD ADJUDICATION COMMITTEE MEETINGS ATTENDANCE
‘19/01/29 ‘19/02/28
‘19/03/29
MEMBER ‘18/11/30 Objection ‘19/02/15 ‘19/02/26 Objection
Richards Bay
Newcastle eThekwini
Ms M P Myeni A A A
Ms S Pillay A
Prof. B Dumisa
Mr M E Mashile R R R R R R
Mr B Radebe A A
14K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
MR B E RADEBE
ACTING CHIEF EXECUTIVE OFFICER
KWAZULU-NATAL LIQUOR AUTHORITY
CHIEF EXECUTIVE OFFICER’S REPORT
It has undeniably and without question been around the clock to ensure their annual targets
yet another challenging year for the KwaZulu- are met – reaching and going beyond the call of
Natal Liquor Authority, however, it has been duty to enhance our services.
our willingness, determination and devotion
that has permitted us to stand triumphant and I am pleased to report that through our
achieve our set out targets/goals. Compliance and Enforcement Business
Unit, the Entity conducted 11 256 Routine
The Entity has been hard at work in introducing Inspections, 86 Blitz operations in partnership
and improving systems and processes to ensure with various government institutions and
an effective, efficient and seamless liquor law enforcement agencies, and 13 out of 13
licensing process. Immense emphasis has been Complaints investigated and concluded within
placed on ensuring customer care and service the prescribed timeframes. Credit is due to all
excellence. The entire KZN Liquor Authority has our stakeholders, partners, the Board and law
been implored to ensure that liquor applications enforcement agencies for their unwavering
were received and processed timeously, contribution and support.
meeting turnaround times as prescribed by
the KZN Liquor Licensing Act (Act 06 of 2010) Alcohol abuse remains our singular concern and
and ensuring continuous education about the the need for education and awareness cannot
dangers of excessive alcohol consumption. be over-emphasized. Our Social Responsibility
Business Unit traversed the length and breadth
During the year and period under review, the of the Province, with 135 induction workshops
Entity has successfully managed to review and for new liquor licence holders, 128 current
develop for implementation in the 2019/20 trader workshops, 4 major seasonal campaigns
financial year, the first phase of the new and 97 school visits conducted. These figures
Liquor Management System (LMS) in order to are a clear indication of the Entity’s commitment
guarantee enhanced operational efficiencies in improving the lives of those directly and
in the liquor licensing application business indirectly affected by alcohol.
processes.
I remain optimistic that the ensuing financial
Whilst we have continued to make great year, we will continue to strengthen our internal
progress in prioritizing service delivery, we and external control processes, systems and
are however aware that there are still areas for stakeholder relations with the express purpose
improvement. All Business Units are working of improving service delivery and efficiency.
15K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
The acquisition of various innovative of Economic Development, Tourism and
programmes and systems will give a greater Environmental Affairs MEC, Ms Nomusa Dube-
impetus to deliver a better and faster service to Ncube, MPL, the mandate still remains, to
our clientele. adequately serve the people of the Province
with immense pride and rigor.
In conclusion, I commend the efforts of our
current and previous leadership, the Board of
Directors, Board Committees, Local Committee
members, Executives, Management and
the entire staff of the KwaZulu-Natal Liquor
Authority for their continued efforts in
moulding, shaping and growing the Entity. _________________________________________
As we ushered in our new KZN Department MR B E RADEBE
ACTING CHIEF EXECUTIVE OFFICER
KWAZULU-NATAL LIQUOR AUTHORITY
16K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
STATEMENT OF RESPONSIBILITY AND CONFIRMATION
OF ACCURACY FOR THE ANNUAL REPORT
To the best of our knowledge and belief, we confirm the following:
1. All information and amounts disclosed in the Annual Report is consistent with the Annual Financial
Statements audited by the Auditor-General.
2. The Annual Report is complete, accurate and is free from any omissions.
3. The Annual Report has been prepared in accordance with the guidelines as issued by National Treasury.
4. The Annual Financial Statements have been prepared in accordance with the Generally Recognised
Accounting Practice (GRAP) standards applicable to the Public Entity.
5. The Accounting Authority is responsible for the preparation of the Annual Financial Statements and for
the judgements made in this information.
6. The Accounting Authority is responsible for establishing and implementing a system of internal
control that has been designed to prove reasonable assurance as to the integrity and reliability of the
performance information, the human resources information and the Annual Financial Statements.
7. The external auditors are engaged to express an independent opinion on the Annual Financial
Statements.
In our opinion, the Annual Report fairly reflects the operations, the performance information, the human
resources information and financial affairs of the Entity for the financial year ended 31 March 2019.
Sincerely
_________________________________________ _________________________________________
MR B E RADEBE MS M P MYENI
CHIEF EXECUTIVE OFFICER CHAIRPERSON: BOARD OF DIRECTORS
17K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
PERFORMANCE INFORMATION:
INTRODUCTION
The KZN Liquor Authority had determined Performance Indicators and Targets for implementation during
the 2018/19 financial. The process of determining the performance indicators was derived from the
strategic guidance provided by the Board of directors who then approved the APP for 2018/19.
The Entity, reports below, on Annual Performance, in line with the Annual Performance Plan for 2018/19
as approved.
ORGANISATIONAL BUSINESS UNITS
18K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
EXECUTIVE MANAGEMENT TEAM:
MR B E RADEBE MR B B MBANJWA
CHIEF EXECUTIVE OFFICER CHIEF FINANCIAL OFFICER
MS Y BACUS MR M TSAUTSE MRS M COLBORNE
EM: COMPLIANCE AND ENFORCEMENT EM: LICENSING AND ADMINISTRATION ACTING EM: SOCIAL RESPONSIBILITY
19K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
PROGRAMME 1: OFFICE OF THE CEO AND THE BOARD
STRATEGIC OBJECTIVES
• To provide strategic direction and leadership to the organisation
• To provide good guidance and counsel to the liquor industry to ensure proper control and regulation
of liquor industry
PROGRAMME NAME: OFFICE OF THE CEO AND THE BOARD
PLANNED MILESTONES DEVIATION FROM COMMENT ON
PERFORMANCE INDICATOR
ACTIVITIES ACHIEVED PLANNED TARGET DEVIATION
Number of monitoring and evaluation
reports with key recommendations for 4 4 0 None
improvements
1 Stakeholder
Number of strategic stakeholder Engagement was
2 1 1
engagements with the liquor industry not held due to the
termination of the CEO
STRATEGIC OBJECTIVES
• Effectively and efficiently engage with all key stakeholders of the Liquor Authority
PROGRAMME NAME : OFFICE OF THE CEO AND THE BOARD
SUB-PROGRAMME: COMMUNICATIONS
PLANNED MILESTONES DEVIATION FROM COMMENT ON
PERFORMANCE INDICATOR
ACTIVITIES ACHIEVED PLANNED TARGET DEVIATION
Effectively and efficiently engage with all
8 8 0 None
key stakeholders of the Liquor Authority
STRATEGIC OBJECTIVES
• To provide for effective and efficient human resources system with the organisation
PROGRAMME NAME : OFFICE OF THE CEO AND THE BOARD
SUB-PROGRAMME: HUMAN RESOURCES
PLANNED MILESTONES DEVIATION FROM COMMENT ON
PERFORMANCE INDICATOR
ACTIVITIES ACHIEVED PLANNED TARGET DEVIATION
1. HR Manager position
was vacant from Q1
up to Q2
Percentage of approved training attended 100% 12.5% 87.5 2. Skills audit was only
and completed concluded in Q4 to
validate training
needs
Vacancy rate on approved staff
10% 8% 0% None
complement.
20K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
PROGRAMME 2: CORPORATE SERVICES BUSINESS UNIT
STRATEGIC OBJECTIVES
PROGRAMME NAME : COPORATE SERVICES
SUB-PROGRAMME: FINANCIAL MANAGEMENT, ASSETS AND BUDGET
PLANNED MILESTONES DEVIATION FROM COMMENT ON
PERFORMANCE INDICATOR
ACTIVITIES ACHIEVED PLANNED TARGET DEVIATION
1
KZNLA obtained
Unqualified Audit opinion issued 1 0 None
unqualified Audit
opinion
Percentage of invoices paid within 30 days 100% 100% 0 None
Percentage of Procurement spend on
100% 100% 0 None
B-BBEE suppliers
• To ensure statutory and regulatory compliance
PROGRAMME 3: LICENSING AND ADMINISTRATION BUSINESS UNIT
STRATEGIC OBJECTIVES
• Regulating the liquor licensing industry by processing all liquor licensing applications received
• Develop and Implement an effective and efficient administrative licensing process
PROGRAMME NAME : LICENSING AND ADMINISTRATION
PLANNED MILESTONES DEVIATION FROM COMMENT ON
PERFORMANCE INDICATOR
ACTIVITIES ACHIEVED PLANNED TARGET DEVIATION
1. Ineffective District
Percentage of applications processed Local Committees
and finalized in line with the prescribed 100% 62.82% 37.18%
timeframes 2. Excess applications
received
Number of reports on the performance of
4 4 0 None
local Committees.
21K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
LICENCES GRANTED PER DISTRICT MUNICIPALITY FOR TRADING YEAR 2019
OVERALL LICENCES ISSUED PER DISTRICT IN THE 2018/19 FINANCIAL YEAR
District Municipality Total
AMAJUBA DISTRICT MUNICIPALITY (DC25) 19
ETHEKWINI METROPOLITAN MUNICIPALITY (ETH) 141
ILEMBE DISTRICT MUNICIPALITY (DC29) 49
SISONKE DISTRICT MUNICIPALITY (DC43) 10
UGU DISTRICT MUNICIPALITY (DC21) 13
UMGUNGUNDLOVU DISTRICT MUNICIPALITY (DC22) 39
UMKHANYAKUDE DISTRICT MUNICIPALITY (DC27) 29
UMZINYATHI DISTRICT MUNICIPALITY (DC24) 9
UTHUKELA DISTRICT MUNICIPALITY (DC23) 21
UTHUNGULU DISTRICT MUNICIPALITY (DC28) 36
ZULULAND DISTRICT MUNICIPALITY (DC26) 24
Grand Total 390
PROGRAMME 4: COMPLIANCE AND ENFORCEMENT BUSINESS UNIT
STRATEGIC OBJECTIVES
• To provide support in the license application process
• To implement an effective and efficient Compliance and Enforcement process
PROGRAMME NAME : COMPLIANCE AND ENFORCEMENT
PLANNED MILESTONES DEVIATION FROM COMMENT ON
PERFORMANCE INDICATOR
ACTIVITIES ACHIEVED PLANNED TARGET DEVIATION
94.31% 10 pre-inspection
reports were concluded
414 out of 424 outside the 14 day
pre-inspection prescribed timeframes
reports concluded due to:
Percentage of pre-inspection reports
100% within the 14 5.69%
concluded within the prescribed time 1. Shortage of
day prescribed
frames inspectors in Q1 &
timeframe
Q2 (redeployed to
10 concluded respective districts
beyond timeframe in Q3)
Overachievement: 42
Unplanned Blitz were
42 additional
Number of inspection blitz conducted 44 86 organized by the SAPS
blitzes conducted
had to be attended by
the entity
22K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
PROGRAMME NAME : COMPLIANCE AND ENFORCEMENT
PLANNED MILESTONES DEVIATION FROM COMMENT ON
PERFORMANCE INDICATOR
ACTIVITIES ACHIEVED PLANNED TARGET DEVIATION
Overachievement: 3056
Unplanned routine
Number of Routine inspections conducted 8200 11 256 3056 inspections organized
by SAPS had to be
attended by the entity
Percentage of complaints investigated
and concluded within the prescribed time 100% 100% 0 None
frames
PROGRAMME 5: SOCIAL RESPONSIBILITY BUSINESS UNIT
STRATEGIC OBJECTIVES:
• To ensure that there are mechanisms developed to reduce the socio-economic and other effects of
alcohol abuse
• Facilitate mechanisms to ensure public participation and good inter-governmental relations in the
liquor licensing process
PROGRAMME NAME : SOCIAL RESPONSIBILITY
PLANNED MILESTONES DEVIATION FROM COMMENT ON
PERFORMANCE INDICATOR ACTIVITIES ACHIEVED PLANNED TARGET DEVIATION
Overachievement: 25
Unplanned school visits
Number of schools visited 72 97 25 were undertaken due to
stakeholder demands
Overachievement: 5
unplanned corporates
Number of corporates visited 88 93 5 visits were undertaken
due to stakeholder
demands
Number of KZNLA initiated seasonal 4 4 0 None
campaigns implemented
Overachievement: 15
Number of workshops held to facilitate unplanned workshops
the entry of new traders into the liquor 120 135 15 were undertaken due to
industry new entrants demands
and expectations
Overachievement; 16
Number of current liquor trader workshops additional workshops
held on all licensing related matters 112 128 16 were held due to
stakeholder demands
Number of reports on induction
programmes on new liquor licensees 4 4 0 None
conducted
• To facilitate, develop and ensure a responsible and sustainable liquor industry
23K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
HUMAN RESOURCES OVERSIGHT STATISTICS:
Performance Rewards
The KZNLA has a Performance Management Policy which has been approved for implementation.
The organisation also had no budget available to cater for performance bonuses thus the Entity only
implemented the pay progression(s) with only five employees did not qualifying for pay progression(s).
% OF PERFORMANCE
PROGRAMME PERFORMANCE REWARDS PERSONNEL EXPENDITURE REWARDS TO TOTAL
PERSONNEL COSTS
TOP MANAGEMENT 0 0 0
SENIOR MANAGEMENT 0 0 0
PROFESSIONAL QUALIFIED 0 0 0
SKILLED TECHNICAL 0 0 0
SEMI SKILLED 0 0 0
UNSKILLED 0 0 0
TOTAL 0 0 0
Training Costs
The Entity has spent R594,885.00 on training for the 2018/19 financial year
Employment and Vacancies 2018/19
2018/19 NO OF 2018/19 2018/19 % OF VACANCY
PROGRAMME
EMPLOYEES APPROVED POSTS VACANCIES RATE
CEO 3 3 0 0%
SOCIAL RESPONSIBILITY 15 16 1 6.25%
LICENSING 30 31 1 3.23%
COMPLIANCE 25 26 1 3.85%
CORPORATE SERVICES 15 17 2 11.76%
COMMUNICATIONS 0 1 1 100%
HUMAN RESOURCES 3 3 0 0%
TOTAL 91 97 6 6.19%
24K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
We have few frozen posts on the below table, they are as follows
1x SR Manager
1x Legal Services Manager
1x Driver and
1x Help Desk Officer
Equity Target and Employment Equity Status as at 31 March 2019
Foreign
Male Female
Occupational Levels Nationals Total
A C I W A C I W Male Female
Top management 1 0 0 0 0 0 0 0 0 0 1
Senior management 3 0 0 0 0 0 1 0 0 0 4
Professionally qualified and experienced
4 0 0 0 4 1 0 0 0 0 9
specialists and mid-management
Skilled technical and academically qualified
workers, junior management, supervisors, 19 0 2 0 20 1 2 1 0 0 45
foremen, and superintendents
Semi-skilled and discretionary decision
11 1 0 0 13 0 1 0 0 0 26
making
Unskilled and defined decision making 1 0 0 0 5 0 0 0 0 0 6
TOTAL PERMANENT 38 1 2 0 42 2 4 1 0 0 91
Temporary employees 0 0 0 0 0 0 0 0 0 0 0
GRAND TOTAL 38 1 2 0 42 2 4 1 0 0 91
ORGANISATION DISABILITY STATISTICS
MALE FEMALE
OCCUPATIONAL CATEGORIES
CURRENT CURRENT
Top Management 0 0
Senior Management 0 0
Professional Qualified 0 0
Skilled Technical 0 0
Semi-Skilled 1 0
Unskilled 0 0
Total 1 0
The current status of the organisation’s disability percentage is 1.10%. The organisation is required to be
at 2%.
Retirement
The Entity had only one retirement in 2018/19 financial year
25K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
Terminations
Indicate how many employees have resigned during the 2018/19 financial year
EXIT TYPE NUMBER % OF STAFF TERMINATIONS
Death 01 1.10%
Dismissal-Operational 0 0%
Dismissal-Misconduct 0 0%
Resignation 03 3.30%
Expiry of Contract 0 0%
Discharge due to ill health 0 0%
Retirement 01 1.10%
Other 0 0%
Total 05 5.49%
Medical boarding
The KwaZulu-Natal Liquor Authority had no medical boarding in 2018/19.
Expiry of Contract
There were no employment contracts for the 2018/19 that have expired.
Internship
We had no interns during 2018/2019 financial year.
Temporary Staff
The KZNLA has not had any temporary staff employed for the 2018/19 financial year
Permanent Appointments
We had 91 employees at the end of March 2019.
Dismissals
The KwaZulu-Natal Liquor Authority had no dismissals for the 2018/19 financial year.
Code of Conduct
The Entity has a Disciplinary Policy in place and it stipulates the Code of Conduct for the Entity which also
serves as a guide and makes provision for progressive disciplinary actions for each category of offence.
26K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
GOVERNANCE REPORT
The Kwazulu-Natal Liquor Authority’s (KZNLA) as other governance structures, which include
Board has absolute responsibility for the management of processes to minimize Conflict
performance of the Public Entity and is fully of Interest, implementation of Code of Conduct
accountable to the shareholder (Department as well as safety, health and other related issues
of Economic Development, Tourism and facing the entity.
Environmental Affairs – EDTEA) for such
performance. The Board`s Charter sets out the Management is responsible and accounts to
responsibilities of Board Members and confirms the Board for developing, implementing and
the Board’s responsibility for the adoption monitoring the processes as outlined and
of strategic plans, monitoring of operational integrating them into operational activities of the
performance and management, determination entity.
of policy and processes to ensure the integrity The Board established appropriate governance
of the KZN Liquor Authority’s Risk management structures. Guided by the recommendation of
and internal controls, communication policy, and the King Code on Corporate Governance and
director selection, orientation and evaluation. the circumstances of the Public Entity, the KZN
The Board provides strategic direction to Liquor Authority has established the following
the entity and is further responsible for the Board Committees, which are appointed by the
development of a Fraud Prevention Policy, as well Chairperson of the Board:
27K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
MR M. THANGO
CHAIRPERSON
AUDIT AND RISK COMMITTEE
The Audit and Risk Committee is chaired by 3. Comment in the annual financial statements
Mr M. Thango who was appointed by the on the financial statements, the accounting
KwaZulu-Natal Liquor Authority, the Committee practices and the effectiveness of the internal
comprises of majority of the members which are financial controls;
financially literate. The Board has appointed two
4. Review the disclosure of sustainability issues
(2) independent non-executive directors namely
in the integrated report to ensure that it is
Mr S Hlophe and Mr D Mncwabe as members of
reliable and does not conflict with the financial
the Audit and Risk Committee. The Audit and
information;
Risk Committee has terms of reference which
outline the composition, operations and guides 5. Recommend to the Board the engagement
the functioning of the Committee. The Audit of an external assurance provider on material
and Risk Committee is responsible for improving sustainability issues;
management reporting by overseeing audit 6. Recommend the integrated report for
functions, internal controls and the financial approval by the Board;
reporting process. The Committee is further
responsible for monitoring and Managing Risk 7. Consider the frequency for issuing interim
issues as delegated by the Board. results;
The Committee’s primary responsibility is as 8. Consider whether the external auditor should
follows: perform assurance procedures on the interim
results
A. Integrated Reporting
9. Review the content of the summarized
The Committee oversees integrated reporting, information for whether it provides a balanced
and in particular the Committee must: view; and
1. Have regard to all factors and risks that may 10. Engage the external auditors to provide
impact on the integrity of the integrated assurance on the summarized financial
report, including factors that may predispose information.
management to present a misleading picture,
significant judgments and reporting decisions B. Combined Assurance
made, monitoring or enforcement actions by a The Committee will ensure that a combined
regulatory body, any evidence that brings into assurance model is applied to provide a
question previously published information, coordinated approach to all assurance activities,
forward-looking statements or information; and in particular the Committee should:
2. Review the annual financial statements, interim Ensure that the combined assurance received
reports, preliminary or provisional result is appropriate to address all the significant risks
announcements, summarised integrated facing the company; and
information, any other intended release of
price-sensitive information and prospectuses, 11. Monitor the relationship between the external
trading statements and similar documents; assurance providers and the company
28K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
C. Finance Function and Financial Director 5. Ensure that there is a process for the audit
Committee to be informed of any Reportable
The Committee reviews the expertise, resources
Irregularities (as identified in the Auditing
and experience of the company’s finance function,
Profession Act, 2005) identified and reported
and discloses the results of the review in the
by the external auditor;
integrated report. The Committee also considers
and satisfies itself of the suitability of the expertise 6. Review the quality and effectiveness of the
and experience of the financial director every year. external audit process; and
7. Consider whether the audit firm and, where
D. Internal Audit appropriate, the individual auditor that will
be responsible for performing the functions of
The Committee is responsible for overseeing of auditor are accredited as such on the JSE list of
internal audit, and in particular the Committee Auditors and their advisors as required by the
must: JSE Limited Listings Requirements.
1. Be responsible for the appointment,
performance assessment and/or dismissal of
G. Authority
the Chief Audit Executive;
The Committee, in terms of its terms of reference
2. Approve the internal audit plan; and
as approved by the Board, has authority as follows:
3. Ensure that the internal audit function is
1. The Committee recommends to the Board
subject to an independent quality review,
with regard to its statutory duties and is
as and when the Committee determines it
accountable in this respect to the Board. On
appropriate
all responsibilities delegated to it by the Board
outside of the statutory duties, the Committee
E. Risk Management makes recommendations for approval by the
Board.
The Committee is an integral component of the
risk management process and specifically the 2. The Committee acts in accordance with its
Committee must oversee: statutory duties and the delegated authority
of the Board as recorded in this terms of
1. Financial reporting risks; reference. It has the power to investigate
2. Internal financial controls; any activity within the scope of its terms of
reference.
3. Fraud risks as it relates to financial reporting;
and 3. The Committee, in the fulfilment of its duties,
may call upon the chairman of the other Board
4. IT risks as it relates to financial reporting. Committees, any of the executive directors,
F. External Audit employees, and Board secretary or assurance
providers to provide it with information
The Committee is responsible for recommending subject to Board approved process.
the appointment of the external auditor and to
oversee the external audit process and in this 4. The Committee has reasonable access to the
regard the Committee must: entity’s records, facilities, employees and any
other resources necessary to discharge its
1. Approve the terms of engagement and duties and responsibilities subject to following
remuneration for the external audit Board approved process.
engagement;
5. The Committee may form, and delegate
2. Monitor and report on the independence of authority to, Sub-Committees and may
the external auditor in the annual financial delegate authority to one or more designated
statements; members of the Committee.
3. Define a policy for non-audit services provided 6. The Committee has the right to obtain
by the external auditor; independent outside professional advice
4. Pre-approve the contracts for non-audit to assist with the execution of its duties, at
services to be rendered by the external auditor; company’s cost, subject to a Board approved
process being followed.
29K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
DR C N KHUMALO
CHAIRPERSON
HUMAN RESOURCES AND
REMUNERATION COMMITTEE
The Human Resource and Remuneration 4. To advise the Board on Human Resources and
Committee is chaired by Dr C N Khumalo, compensation matters;
who was appointed by the KwaZulu-Natal
5. To recommend to the Board for approval,
Liquor Authority. The Board has appointed an
overall Human Resources Strategy
independent Non-Executive Director, to serve
as a member of the Committee and provide the 6. To recommend to the Board for approval, key
required expertise to assist the Board in achieving human resources policies and procedures in
its mandate. The Human Resources and line with the corporate strategy and other
Remuneration Committee has Terms of Reference statutory requirements
which outline the composition, operations and
guides the functioning of the Committee. 7. To recommend to the Board for approval,
overall compensation policy framework for
The Committee’s primary function include the organisation and consider annually a
reviewing and recommending to the Board the report on the proposed salary increases for
following: staff across the entity
1. To review the performance objectives and 8. To recommend to the Board for approval
determine and agree the appropriate levels of staff conditions of service and other related
compensation, i.e. salary, bonus and incentive matters
arrangements,
9. To recommend organisational structure to
2. Human Resources Management and the Board
Development; and Staff Training and
10. for approval
Development;
11. To recommend to the Board and monitor on
3. Overall oversight responsibility on
behalf of the Board the corporate training
compensation matters of the entity to review
plan
the design and management of organisation’s
salary structures and incentive schemes and
ensure proper authorization for awards made
under such schemes
30K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
INKOSI M I TEMBE
CHAIRPERSON
FINANCE COMMITTEE
The Finance Committee was established in 3. Review and recommending an annual
the Second Quarter of the 2018/19 financial operating budget and annual capital budget;
year and is chaired by INKOSI M I TEMBE, who 4. Review and recommending capital
was appointed by the KwaZulu-Natal Liquor expenditures and unbudgeted operating
Authority and the Committee comprising of expenses that, per Board approved policy, are
above management authority but below the
three (3) directors with backgrounds in finance,
threshold required for Board approval;
accounting, business, investment management,
executive leadership, and business ownership. 5. Review the financial aspects of major
proposed transactions, new programs and
The overall role of the Committee is to review services, as well as proposals to discontinue
the annual financial statements and the mid-year programs or services, and making action
budget and performance assessment reports, and recommendations to the Board;
other financial information to be made public, 6. Monitor the financial performance of the
prior to submission and approval by the Board. entity as a whole and its programmes against
approved budgets, long-term trends, and
Functions of the Committee: industry benchmarks
To monitor the Entity’s activities with regard to
7. Require and monitor corrective actions to
matters relating to –
bring the entity into compliance with its
1. Recommend policies that maintain and budget and other financial targets
improve the financial health and integrity of
8. Recommend to the Board policies governing
the Entity
investments and pension plans
2. Review and recommending a long-range
financial plan for the Entity
31K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
MRS S PILLAY
CHAIRPERSON
SOCIAL AND ETHICS COMMITTEE
The Social and Ethics Committee is chaired by 2. The report of the committee may take the
Mrs S Pillay, who is appointed by the Board’s form of an oral or written report by the
Chairperson and the Committee comprising of chairperson or any other member of the
three (3) directors. The Committee is responsible Committee designated by the Committee to
for ensuring ethical conduct of Management make such report; and
and Staff and collective responsibilities of Board
members in respect of their fiduciary duties 3. The committee should not assume the
and responsibilities, and they must continue to functions of management, which remain
exercise due care and judgment in accordance the responsibility of the executive directors,
with their legal obligations. officers and other members of senior
management;
4. The committee must monitor on-going
Functions of the Committee investigations and appeals brought to its’
attention and which are relevant to the ethical
1. The Committee must monitor, report, advise conduct of those associated with the entity.
and make recommendations to the Board
regarding the ethical conduct of the Entity, 5. The Committee must consider and
its directors and its employees having regard recommend any policy relating to social and
to the applicable legislation, principles and ethics responsibilities for the KZNLA and/or its
guidelines. staff.
32K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
PROF. B DUMISA
CHAIRPERSON
BOARD’S ADJUDICATION COMMITTEE
The KwaZulu-Natal Liquor Authority established was subject to review by the Board at any given
a Committee comprising of three (3) Board point. The Board ensured that due diligence was
members and chaired by Prof. B Dumisa, to carry applied in consideration of all applications lodged
out the function of adjudication. The Committee in terms of the applicable Act.
has the key responsibility to consider, grant or
reject liquor licence applications in the Province.
The adjudication Committee reports to the Board
Board Members’ Remuneration
on all matters finalised by the Committee.
The MEC for Economic Development, Tourism
The Board during the year of reporting, delegated
and Environmental Affairs, determined the rate
certain adjudication responsibilities to the CEO
for remuneration of Board members. The fee
for processing. The Board continued to provide
structure outlines the full terms for payment of
oversight over the delegated responsibility to
each member either for attendance at Board
ensure that the entity and the clients we serve,
meetings, or participation in Board Committees.
were not compromised. The Board, however, met
The remuneration determinations by the MEC,
to consider the remainder of the undelegated
further in the case of KZNLA, outline the rate for
function through its adjudication Committee as
payment of members for adjudication processes.
reported on above.
Board members were paid in accordance with
At the end of the year of reporting, the Board, in the determinations which clearly states that
line with section 21(1) (a) (i) of the KZN Liquor members are paid a retainer and attendance fee
Licensing ACT no. 06 of 2010 amended in 2013, for Board meetings but are just paid a retainer for
delegated to the CEO the following applications participation in Committee meetings. Members
as contemplated on the same ACT, section 41, are paid an hourly rate for attendance at special
52, 55, 69, 74, 75, 77 and 89(12). The delegation meetings, if these are over and above the meetings
prescribed within the retainer fee.
33K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
AUDIT REPORT
REPORT OF THE AUDIT AND RISK COMMITTEE NUMBER OF
MEMBER MEETINGS
The Audit and Risk Committee is an operating ATTENDED
Committee of the Board of KwaZulu-Natal Liquor Mr M Thango – Chairperson 6
Authority, charged with oversight of financial
reporting and disclosure. The members of the Mr S Hlophe – Independent external member 4
Committee are drawn from and appointed Mr D Mncwabe – Independent external Member 5
by the company’s Board of directors, with the Mr E M Mashile – Ex Officio Member (Resigned) 3
Chairperson remaining as the representative from
Mr B E Radebe – Ex Officio Member 4
the Board. The Committee is charged with the
responsibility to assist the Board in discharging Mr B B Mbanjwa – ex-officio member 6
its duties relating to the safeguarding of assets,
effective management of liabilities and working
capital, the operation of adequate systems and RISK MANAGEMENT
process of internal control and the preparation of The Audit and Risk Committee, considered
financial reports and Annual Financial Statements. the organisational Risk Register which was
reviewed by management with the assistance
of Provincial Treasury. The Committee further
AUDIT COMMITTEE’S RESPONSIBILITY assessed the risks as identified and ensured that
The Audit Committee reports that it has performed strategic Risks were effectively monitored. The
its duties and complied with its responsibilities in Committee monitors the implementation of
accordance with the Public Finance Management controls as identified, through reports tabled and
Act and the Treasury Regulations. The Audit interrogated during the Audit and Risk Committee
Committee also reports that it has approved meetings on a quarterly basis. The Audit and
Terms of Reference, which were adopted as the Risk Committee constantly monitors the roll-out
Audit and Risk Committee Charter which the of risk management to ensure that this process
Committee regulated its affairs in compliance reaches maturity with a reasonable time. The
with and discharged all its responsibilities as Committee engaged on a process to develop
contained therein. The Committee held a Special the Risk Management Framework, and guided
meeting to consider and finalize the Annual management in this process.
Financial Statements for submission as per the The Committee considered and approved the
PFMA requirements. Risk Management for the entity which guides
the risk management process within the entity.
The Committee, also adopted a risk governance
MEMBERSHIP AND ATTENDANCE system, which assists the Committee in extracting
The Audit and Risk Committee, for the year under required reports which will guide the Committee
review consisted of the members listed hereunder in effectively providing the oversight as stipulated
and met six (6) times as per approved Terms on the Committee terms of reference.
of Reference, with one (1) special Committee
meeting held.
INTERNAL AUDIT
Internal Audit was operated through an Annual
Operational Plan, between the KZNLA and Nexia
34K W A Z U L U - N A T A L L I Q U O R A U T H O R I T Y | A N N U A L R E P O R T 2 0 1 8 / 1 9
SAB&T which was approved by the Board. The The Audit and Risk Committee reviewed quarterly
audit coverage included mainly recurring audits financial reports and is satisfied that controls are in
and focused on areas considered to be key. The place to monitor spending patterns. The Quarterly
results of the internal audits were presented to reports were submitted to the Board for noting
management for their response on findings and and to the Department of Economic Development
to the Audit and Risk Committee for final review and Tourism in line with the funding agreement.
then to the Board for noting. The Audit and risk The Committee, also placed considerable effort
Committee also thoroughly interrogated the in reviewing the Performance of the entity
Internal Audit Operational Plan and ensured that through considering and aligning performance
the internal audit are effectively executed to the information with the organisational performance
benefit of the entity. as reported by management. The Committee
ensured that, there is a balance and justification in
terms of financial performance and organisational
EXTERNAL AUDIT performance of the entity. Emphasis was placed
on ensuring that the organisational plan for the
The Committee met with the external auditor
2017/18 financial year, is aligned to the budget
to thoroughly engage on the Audit Strategy
allocations and the Committee committed to
for the 2018/19 financial year. The Committee,
ensuring that oversight, in ensuring that this is
committed to ensuring that strategies are in place
monitored, will be conducted.
to ensure that processes run effectively for ease of
Audit implementation.
INFORMATION TECHNOLOGY GOVERNANCE
EVALUATION OF FINANCIAL STATEMENTS The Audit and Risk Committee reports that it
considered all IT policies as reviewed and made
The Committee:
recommendation for consideration and approval
1. Considered all financial information by the Board. The Committee received reports from
2. Considered the appropriateness of policies as the IT Steering Committee, and is thus assured that
developed sufficient oversight is exercised on IT Governance
matters within the entity. The Committee, upon
3. Met separately with management to discuss realizing that the Liquor management system
the draft financial statements, external currently utilized by the entity, is not assisting
auditors to consider the findings on the audit the entity to efficiently execute its mandate,
report and the audit unit at Treasury to plan recommended that management working with
for internal audit processes for the Liquor the IT Steering Committee members, draft Terms
Authority of Reference of the development of a new system.
4. Made appropriate recommendations to the The Committee is constantly updated and
Board regarding corrective actions to be taken continuously provides required direction to
as a consequence of audit findings management and advice to the Board in this
5. Reviewed and recommended for adoption by regard.
the Board financial information that is publicly The Audit and Risk Committee concurs with
disclosed within the annual report and accepts the Auditor-General’s conclusions
on the Annual Financial Statements and is of
the opinion that the audited Annual Financial
GOVERNANCE PROCESSES AND ACCOUNTABILITY Statements be accepted and read together
with the report of the Auditor General.
The Committee reports that it has adopted
appropriate terms of reference which serve as
the Committee charter. All the Committee affairs
have been regulated in compliance with the
Committee charter, and discharging of Committee
responsibilities has been done in accordance with
what is contained therein.
35You can also read
