JOHANNESBURG CITY PARKS

(An association incorporated under Section 21)

Registration No: 2000/028782/08

(In terms of Section 121 of the

Municipal Finance Management Act, 2003 and Section 46 of the Municipal Systems
Act, 2000)
 JOHANNESBURG CITY PARKS
AN ASSOCIATION INCORPORATED UNDER
SECTION 21 OF THE COMPANIES ACT

COMPANY INFORMATION:

Registration number : 2000/028782/08

Registered Address : Johannesburg City Parks

City Parks House
40 De Korte Street
Braamfontein
2017

Postal Address : P O Box 2824

Johannesburg
2000

Telephone number : (011) 712-6600

Fax number : (011) 712-6796

Website : www.jhbcityparks.com

Bankers : ABSA Bank of SA Limited

Auditors : Auditor-General

Vision
To be the leading African green environment
And cemetery management company.

Mission
To develop, maintain and conserve the
green environment and cemeteries
for present and future generations.

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 TABLE OF CONTENTS

CHAPTER ONE: INTRODUCTION AND CORPORATE PROFILE

Section 1: Corporate Profile and Overview of the entity 4

Section 2: Strategic Objectives 7
Section 3: Foreword by Member of the Mayoral Committee 9
Section 4: Chairperson’s Report 10
Section 5: Managing Director’s Report 14
Section 6: Statement of Responsibility 24

CHAPTER TWO: PERFORMANCE HIGHLIGHTS

Section 1: Highlights and Achievements 25

Section 2: Financial Performance 28
Section 3: Capital Projects 31
Section 4: Performance against IDP and City Scorecard 38
Section 5: Assessment of Arrears on municipal taxes and service charges 42
Section 6: Statement on amounts owed by Government Departments and public entities 44
Section 7: Recommendations and Plans for the next financial year. 45

CHAPTER THREE: DIRECTOR’S REPORT AND GOVERNANCE

Section 1: Corporate Governance Statement 46

Section 2: Board of Directors 46
Section 3: Board Committees 50
Section 4: Director’s Remuneration 52
Section 5: Company Secretarial Function 54
Section 6: Risk Management and Internal controls 55
Section 7: Internal Audit Function 58
Section 8: Response to the Auditor-General Report 59
Section 9: Corporate Ethics and Organisational Integrity 60
Section 10: Sustainability Report 61
Section 11: Corporate Social Responsibility Report 62

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CHAPTER FOUR: HUMAN RESOURCES AND ORGANISATIONAL MANAGEMENT

Section 1: Human Resource Management 64

Section 2: Employment Equity 66
Section 3: Skills Development and Training 68
Section 4: Performance Management 69
Section 5: HIV/AIDS on the Workplace 70
Section 6: Employee Benefits 73
Section 7: Supply Chain Management and Black Economic Empowerment 74

CHAPTER FIVE: AUDITED STATEMENTS AND RELATED FINANCIAL INFORMATION

Report of the Auditor-General 76

General Information 81
Directors’ Responsibilities and Approval of Statement 83
Directors’ Report 85
Report of the Company Secretary 87
Statement of Financial Position 88
Statement of Financial Performance 89
Statement of Changes in Net Assets 90
Cash Flow Statement 91
Notes to the Annual Financial Statements 92
Detailed Statement of Financial Performance 140
Annexure E 142

CHAPTER SIX: FUNCTIONAL AREA SERVICE DELIVERY REPORT 141

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CHAPTER ONE: INTRODUCTION AND CORPORATE PROFILE

Section 1: Corporate Profile and Overview of the entity

Johannesburg City Parks (JCP) is the greening, conservation and cemetery management
entity for the City of Johannesburg (CoJ). It was incorporated under the seal of the Registrar of
Companies on 15 November 2000 as a Section 21 (non-profit) Company and business
commenced on 1 January 2001.

Johannesburg City Parks’ mandate is to provide and manage the parks, designated open
spaces, environmental conservation services and cemeteries for and on behalf of the City of
Johannesburg.

Accordingly Johannesburg City Parks manages the following assets:

Area of Management Quantity

Number of Parks and Arterials 2 328
Area of Developed Parks and Arterials 6 587,5 hectares
Area of Undeveloped Parks 3 576,5 hectares
Nature Reserves 1 569 hectares
Street Verges 5 500 hectares
Street Trees 1,3 – 1,6 million
Number of Cemeteries 35
Area of Cemeteries 904 hectares
Number of Crematoria 2
Number of Nurseries 2
Water surfaces 174 hectares
Bird sanctuaries 24,6 hectares
Trails and River Trails 107km
Environmental & Education Centres 6
Size of fleet 321 Vehicles; 136 Trailers

Total number of employees as at 30 June 2008: 1 799

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Johannesburg City Parks is committed to the principles of the Jo’burg 2030 Vision as
encapsulated in the strategy of the City of Johannesburg. The Company aligned its Business
Plan with the Integrated Development Plan and Environmental Sector Plan of the CoJ via its
programmes and projects.

Functional areas
Parks, Designated Public Open Space, Nature Conservation Areas and Cemetery
Maintenance
- Horticultural Services
- Arboriculture Maintenance
- Infrastructure Maintenance
- Nursery Operations

Cemeteries Management
- Burials
- Cremations
- Archival Records

Environmental Conservation
- Biodiversity management
- Environmental awareness
- Environmental training, empowerment and capacity building
- Bio-aquatic management
- Botanic research, monitoring & information sharing
- Conservation, Rehabilitation, Enhancement of ecosystems
- Invader species control
- Open space impact management and provisioning
- Environmental Compliance and Open Space Impact Management
- Ecotourism and conservation business development

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Project Management
- Planning
- Design
- Landscaping

Marketing
- Marketing and Market Research
- Stakeholder Liaison
- Communication
- Media Liaison
- Business Development

Training and Education

- Horticultural and other job related training
- Training of temporary workers through EPWP, with regard to the required
safety standards and task related skills

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Section 2: Strategic Objectives

JCP has aligned its strategic objectives with the City of Johannesburg’s Mayoral Priorities,
strategic plans and five-year programmes as follows:

Improve Service Delivery

JCP’s service delivery mainly consists of development, maintenance and conservation of
public open space and the natural environment, greening of the City (i.e. planting of trees),
and securing of burial space for the future.
This strategic objective has been successfully achieved and exceeded in many ways.

Effective Financial Management

JCP addressed the Mayoral Priority of a “Well Governed and Managed City” with the strategic
objectives of Sound Financial Management, Capex Implementation and the Management of
Risks. Corporate Governance and MFMA assessments were also done as well as regular
internal audits. The unqualified audit results proved that JCP has been well governed and
managed.

A Safe, Clean and Green City

By its very nature JCP contributes to the greening of the City with special emphasis on those
areas requiring attention in this regard. To safeguard conservation areas JCP initiated areas
to be re-proclaimed as nature areas. Also, areas to be rezoned as parks have been identified
and advised to the CoJ.

Occupational Health, Safety and Security

The design and layout of facilities have been done with safety in mind, and the safety in our
facilities has been improved through our Park Warden monitoring system and the involvement
of other MOE’s such as Metro Police. Through compliance to the Occupational Health and
Safety Act, and the SMME safety programmes, safety in the workplace and at our facilities has
been enhanced.

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HIV and AIDS
JCP continues to combat HIV and AIDS through the development and education of staff as
well as wellness programmes to ensure staff performance. JCP complies with the City’s and
its own HIV and AIDS policies.

Customer Satisfaction and Responsiveness

Through improved service delivery JCP has improved customer satisfaction. JCP’s employee
satisfaction, sustainability of our service delivery and service delivery excellence also played a
valuable role towards community development.

Economic Development and Job Creation

JCP continues to contribute to economic development and job creation through the
implementation of the Expanded Public Works Programme. New jobs were created, people
were trained and the extent of SMME procurement contributed to achieving this Mayoral
Priority.

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Section 3: Foreword by Councillor P. Naidoo, Environmental Portfolio member of the
Mayoral Committee

City Parks has and continues to play a significant role in protecting, maintaining and
expanding the City Of Joburg’s green and open spaces.

The Honourable Mayor, Cllr Amos Masondo, set City Parks the ambitious task of planting 200
000 trees by the year 2010. It is with a great sense of pride that I can categorically state that
City Parks is comfortably on track to achieving this difficult task.

City Parks has aggressively pursued the objective of developing open spaces in previously
disadvantaged townships. They have launched and continuously service parks to the highest
quality standards in townships throughout the city. City Parks in partnership with Township TV
have turned our parks into spaces of learning and community gatherings.

Central to the many achievements by City Parks, is their valued participation in the Klipriver/
Klipspruit Rehabilitation Project. Once again the quality of the development of the
environmental nodes along these waterways can be judged by the number of people utilising
the facilities City Parks has developed and maintains in the areas along these rivers.

Under the leadership of Mr Luther Williamson and it’s hard working employees, City Parks will
leave a legacy of green spaces that will be appreciated by many generations to come.

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Section 4: Chairperson’s Report

Introduction

2007/2008 started with a challenge for JCP as our Managing Director was seconded to Pikitup
and a number of our Board members were serving their first term. In spite of these challenges,
I am pleased to report that JCP continued to set high standards and pursued high levels of
service delivery. The 96% overall achievement in the scorecard by our Executive Management
bears testimony to this.

Our Executive management team experienced some changes with the replacement of the
Company Secretary and the HR Executive in the third quarter of the year. In spite of these
changes at the Executive Management levels, staff have continued to demonstrate their
commitment, enthusiasm and innovation in fulfilling JCP’s mandate and the CoJ’s Service
Level Agreements with JCP.

Mandate

The mandate of JCP is to develop, maintain and conserve open spaces. In this financial year,
JCP continued to align its business plan to the Mayoral Priorities and to the Environmental
Sector Plan in order to meet the expectations of its customers and stakeholders. It is in this
context that the performance of JCP must be viewed.

Performance Review

A key focus of our activities, in addition to the maintenance of our portfolio, has been the 200
000 tree planting campaign. We are pleased that this campaign is gaining ground and trees
are now visible, especially in the underserved areas of our population. These areas, through
this campaign and the beautification of our side walks and road islands have made our city to
look vibrant, green and fresh. Management has championed this project with vigour and
aplomb and we want to express our greatest appreciation to the Companies and individuals
that have supported this initiative financially and through their donation of trees.

Our flagship program, the Extreme Park Makeover, where a park is developed in 24 hours,
benefitted the community of Diepkloof in this financial year where 2 hectares of land was
converted to one of the most aesthetically pleasing parks in the City of Johannesburg. We are
proud to yet again announce another first, the development of a Park for People with
Disabilities. This was achieved through a combination of JCP allocations, contributions by
Standard Bank and the prize money of £10 000 Pound Sterling that JCP won as part of the
LivCom awards.

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On behalf of the Board we wish to congratulate management on benchmarking our work with
international norms and winning 8 awards of the International LivCom awards that were held in
London. This continues to demonstrate the continued emphasis on innovation and sound
business processes that JCP always aspires towards.

We are in the process of establishing a cemetery in the South in anticipation of the near full
capacity of Avalon cemetery. Approximately 260 hectares of land have been acquired and
fenced and the EIA processes are in progress. This initiative will have to be capitalised to the
tune of +/-R9m in the financial year 2008/2009 if the City were to be ready to replace the fast
filling Avalon Cemetery.

Financial Performance

The Financial performance of the Company is detailed and outlined in the report of the Chief
Financial Officer. Management and the Audit Committee of the Board have worked hard in
ensuring that JCP remains accountable for the resources that are allocated to it by the City.

In spite of revenue growth and cost containment efforts and strategic cash flow management,
we unfortunately have to report a slight deficit in operational expenditure. This was occasioned
largely by an increased level of activities that had to be concluded and many of the unfunded
mandates that we found ourselves having to perform in an effort to maintain high service
delivery standards across the City. The reasons and the extent of the deficit are fully disclosed
in the report of the Chief Financial Officer.

Corporate Governance

The Board is responsible for oversight of the organisation. Management is responsible for
running the organisation. In our oversight roles, the Board has done this through the
establishment of various committees. These committees include the Committee of Chairs
which reviews the strategic inputs of each committee, the Remuneration Committee which
reviews the performance of the Executives and considered a number of remuneration matters,
the Internal Risk and Audit Committee which provided strategic insight and risk containment
measures for the organisation, the Human Resource Committee which reviews on an ongoing
basis our human capital requirements and challenges, the Finance and Operations Committee
which supports and reviews operational and financial requirements of the organisation and
the SHEQ Committee which focuses on Health and Safety issues in the organisation.

In this financial year the activities of the board were heightened and a number of policies and
mandates were revised. Key amongst these was the SHEQ policy, the Remuneration Policy,
Sexual Harassment, Smoking and Acting policies. The board also dedicated its time by
reviewing the Company’s strategy and formulated a new strategic plan. Scorecards were
11
revised for the period 2009-2011, in line with the dictates of the CoJ Integrated Development
Plan and the Environmental Sector Plan.

To attest to the work of the Board, the Board Assessment results published by Price
Waterhouse Coopers under contract with the Share Holder Unit have indicated positive results
of the JCP Board.

The Internal Audit function performed to expectation and provided assurance to the Board on
the effectiveness of internal controls, risk management and governance processes within the
Organisation. The safety, health and environmental issues were reviewed and monitored
quarterly and reported on as part of risk management.

Employment Equity and Black Economic Empowerment.

JCP is committed to correcting past imbalances in terms of employment equity. We are

however clear that affirmative action is not a recipe for the replacement of skilled labour but an
instrument to increase representation of the previously disadvantaged in critical job categories
of the organisation.

In the current financial year, almost all new appointments were from the previously
disadvantaged groups, of which 78% were African Females. In addition management
successfully implemented a vigorous Women’s Development Program where 12 women were
identified and mentored for management advancement in the organisation. The targets set in
terms of the equity plan were continuously monitored and managed by the HR committee in a
manner that resulted in the set targets being met.

The company has continued to ensure that Black owned companies are provided
opportunities by exercising the Preferential Procurement Act of 2000. This is illustrated in the
amount of work that was allocated to BEE companies including women owned and controlled
companies. The target of 85% set for procurement from BEE suppliers was exceeded.

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JCP looking into the future

The company is committed to the mandate of the City as well as to the alignment of its
business to the Mayoral priorities and the Environmental Sector Plan and will in the next
financial year focus on the following areas: The 2010 Soccer World Cup, the Greening of
Soweto, the planting of the balance of the 200 000 trees, the rehabilitation of the Kliprivier /
Klipspruit Project, the Beautification of the City, Road Island beautification, the development of
more water features and the finalisation of a Landscaping Master Plan. It will also place
emphasis on regular Park and Cemetery development and review initiatives to enhance Park
safety as well as increase its service portfolio and provide added value in Capital projects.
Women empowerment, and the Expanded Public Works Programme will continue to be our
focus.

Acknowledgements

My heartfelt congratulations and thanks go to the Management and Employees of JCP whose
commitment, loyalty and drive continue to be the cornerstone of these excellent results.

Thanks to all our Stakeholders, Customers and Suppliers. The support and encouragement of
the Member of the Mayoral Committee (MMC), Councillor Prema Naidoo, the Executive
Director for Environment, Ms. Flora Mokgohloa and her staff as well as the City is
acknowledged. I am proud to have been part of all the achievements and would like to thank
all the Board Members for their contribution yet again.

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Section 5: Managing Director’s Report

Overview

The Global economic turmoil brought on many challenges for our operations, but in spite of
these challenges, City Parks produced favourable results. We remained focused on our Key
Performance Areas and all objectives that contributed to customer and stakeholder value add
were met. The focus for the year under review was to ensure that we provide a service to our
communities that is globally competitive, through increased productivity and quality services.
There were a number of unique initiatives and innovations that drew a significant amount of
interest both globally and nationally and one such example is our Xtreme Park Make Over.
Specific attention was placed on ensuring that our customers are part of the number of our
Capital projects and programmes that were implemented; this has fundamentally contributed
to our sound corporate reputation and increased customer satisfaction rating.

The Sound IDP performance scorecard results were influenced by a carefully planned strategy
that ensured that we back our operations by effective systems and controls. This is evident
under the section: Performance against IDP scorecard. Examples of these areas of
performance or initiatives are: the development of another 24 hour Xtreme Park Makeover,
planting in excess of 49 000 trees, receiving a number of International Awards for specific
projects and the partnering with Township TV to provide educational as well as recreational
programmes into the previously disadvantaged areas.

Talent management and skills development were some of the critical aspects that contributed
to the added investment in our people resources. Human Capital management, training and
development, the Expanded Public Works Programme and our Employment Equity
Programme was on track with the transformation objectives that were set. The strategic
objectives were effectively achieved because of the passion and tenacity of our employees to
remain focused on the collectively developed goals and objectives that were set. The
Performance Highlights serve to qualify and support the placed emphasis on getting all our
people to do extraordinary things.

Performance Highlights
 In this reporting year (2007/8), 49 245 trees were planted compared to 21 653 trees
planted in the previous year.
 The survival level of newly planted trees was maintained at 95%.
 Street trees enquiries for the year 2007/8 totalled to 8 109, bringing a 10% reduction
when compared to the amount of enquiries that was received for the period 2006/7,
being 8 920.
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  3 New developments in parks were completed including 4 New developments in
cemeteries.
 The customer satisfaction index was 78%.
 Stakeholder visits increased to 1 668 vs. the previous year’s 344.
 External Services’ revenue increased by 148% to R38 m.
 BEE Procurement increased from 84% to 87%.
 1 049 Employees were trained in the period 2007/8.
 100% of Capital projects were completed.
 19 684 learners were reached through environmental training programmes. 49 684
Primary Beneficiaries were reached by our Environmental Education awareness
programmes.
 Emphasis was placed on job creation in that 1 133 jobs were created in 2007/8. In the
previous year 963 jobs were created.
 93% of appointments effected were from PDI, 59% of that was female, with 84% of that
being African Black.
 Development of the first Xtreme Park Make-Over in Soweto at Immink Road, Diepkloof

Financial Performance
This was a challenging year for City Parks due to fuel price increases and the absorption of
prior year Capital Projects and projects that were completed during the year that were added
to our maintenance portfolio. The increase in sales revenue and the resultant surplus from
External Services assisted operations in some degree to maintain and provide services to
those areas that were beyond the scope of budgeted activities. The financial results were
relatively close to budget and the results are to be read bearing in mind the portfolio growth
and the efficiencies that we applied to ensure that the deficit is conservative and is in-keeping
with a non profit organisation. Our balance-sheet reflects a very positive cash position and all
liabilities are adequately provided for, resulting in a reasonable liquidity position. The
performance during the financial year presents a positive outlook for the years to come with an
added degree of financial prudency.

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Financial headlines
Revenue excluding interest increased in relation to the prior year by R57,1 m and concluded
at R425.3 m and the complimentary department to the significant increase in revenue was
external services which experienced revenue growth to the tune of R27 m. External Services
revenue book concluded at R42 m. Cemeteries revenue (R15.5 m) equally influenced the
increase in total revenue in that cemeteries revenue exceeded budget by R1.1 m. Events
revenue was slightly under budget in that income realised was R1.2 m against a budget of
R1. 5 m

Expenditure was budgeted at R429.8 m and closed at an actual of R449.6 m, the increase in
expenditure being influenced by the cost of sales relating to the increased order book. The
year- end cash position (Share-member sweeping cash debtor balance due to City Parks)
R181.2 m.

BEE
The Broad- based Black Economic Empowerment codes of Good Practice, legislated in 2007,
has enabled us to engage with a number of stakeholders who have enabled a number of the
Small Medium Enterprises on our database to grow from strength to strength. Black Economic
Empowerment increased from 84% in the last financial year to 87% this year. A great
emphasis was placed on developing SMME’s and our supplier chain database of black service
providers has increased in number, in order to generate a more competitive procurement
environment. The EPWP programme works in conjunction with our empowerment programme
and SMME’s are enabled to render service by drawing on people who were trained through
the EPWP programme.

Operations
Our flexibility in the face of external and internal challenges contributed to successful service
delivery but we have now placed emphasis on improving standards of our facilities so to meet
new customer expectations. Operations are mindful of the fact that yesterday’s greatness can
be tomorrow’s mediocrity when considering new and divergent customer aspirations and
expectations. The emphasis over the past financial year has been on the development of
qualitative maintenance standards rather than focusing on the traditional quantitative-based
measures. There was a reduction in customer complaints considering the increase in the
utilisation of our facilities as a result of the role out of new products in our park like Township
TV.

19 684 Learners attended the various environmental programmes and this was complimented
by National Arbor Week and the Greening of Soweto.

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Street Trees
With the Mayor stretching our tree planting targets from 20 000 to 50 000 per annum in
December 2007, Johannesburg City Parks planted a total of 49 245 for the financial year.
Collectively 90 738 trees have been planted and we are on course to meet the challenge of
200 000 trees by 2010/11.

Cemetery Operations
The implementation of the resource planning strategy and qualitative maintenance at
cemeteries has resulted in the desired maintenance standards being achieved. Burials and
cremation records over a five year period have shown a marginal decrease from the number of
21 575 for 2005/06, The total burials and cremations for 2006/07 amounted to 21 173, and
2007/8 saw a total of 21 030. The impact of migrant labourers in urban areas directly
contributes to the fluctuation in the number of burials as most return to their areas of family
birth. Strategically the burial rate has directed the development of regional cemeteries within
areas of need and provided time lines for future roll-out plans.

Total Burials- Quarterly Comparison

Burials for this financial year totalled at 17 739, whereas when compared against the 2006/7
period having 18 847 burials there has been a decrease of 6,3% in the total no of burials.

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Cremations per Facility

The graph above highlights the distribution of cremations within our 3 facilities. A total of 2521
cremations for 2007/08 have been recorded. When compared with a total of 2226 in 2006/07,
there has been as increase of 13,2%.

Pauper and Indigent Burials

Indigent burials have shown a steady increase since the introduction of the Social Policy but
have shown a conservative increase. Pauper burials continue to be unpredictable and have
increased by 7% when compared to last year. The total for 2007/08 is 916, whereas in
2006/07 it was 856. This could be attributed to cell phones, ID documents, drivers licenses as
well as banking details that people carry on them that enhances the likelihood of identification.

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Gender

The average gender ratio throughout South Africa according to Statistics South Africa is 93
males to 100 females whilst the ratio for the CoJ is recorded as close to being equal. During
the year, the ratio reflects a 51% female and 49% male burial rate which is line with the CoJ
statistics.

Natural versus Unnatural Deaths

The above figures are in line with the 6% national average of unnatural deaths.

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Environment
The Company aims to protect, manage and restore the integrity of the Sharemembers
ecological systems with special concern for biodiversity and natural processes within open
spaces. In order to achieve the abovementioned, the Company aligned its Business Plan in
terms of the Environmental Sector Plan.

The following are examples of projects which have been dealt with in terms of the
Environment Sector Plan: A Bio-Aquatics Management Plan has been developed (Zoo lake,
Bruma lake, Westdene Dam, Moroka Dam, Dorothy Nyembe Dam, Blue Dam and Florida
Lake were maintained).

Manage and control of reeds taking into account ecological and social consideration: Dorothy
Nyembe wetland, Mofolo South, Dlamini & Lenasia nodes reed control was undertaken.

Wetlands were rehabilitated (Mapetla wetland, Baileyspruit SANBI intervention, Florance

Bloom & Bosmontspruit wetland). Five (5) Ecological Management Plans were developed for
the following areas: KNR, Kloofendaal, Cosmo City, Melville Koppies, Rietfontein and The
Wilds.

Expanded Public Works Programme

The main objective of the Expanded Public Works Programme (EPWP) is to create jobs, to
train and develop workers/contractors with the result of improved service delivery and
economic growth. The plan was to create 350 jobs (60 000 man days) and to facilitate 2000
training days of skills development for 2007/08.

For the year 2007/2008, 1 133 new jobs were created and 2 152 jobs have been sustained
through Opex/ Capex projects. 433 People (2 824 training days) were trained in General
horticulture, occupational health & safety, brush cutting & chainsaw handling, pesticide &
herbicide application and fire fighting accredited courses. On site on- the- job training related
to an additional 714 training days.

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Security in facilities
The Company was more visible in terms of the Park Rangers at the various facilities under our
control than in the previous year. The total number of facility visits by JCP Park Rangers for
the current financial year amounted to 21 252 compared to the 12 710 facility visits of the
previous financial year. This contributed significantly to a reduction in incidents at our facilities.
The increase in patrols resulted in various positive results such as increased visibility of teams
and utilisation of facilities, and a decrease in incidents in cemeteries.

During the year, the Park Rangers also participated in 20 special operations in conjunction
with the SAPS and JMPD. During the year 339 arrests were made, 76 spot fines were issued
and 3 346 vagrants were removed with the assistance of JMPD and SAPS.

Risk Management
The Board approved the Risk Management framework and also assessed the Companies risk
management appetite. Management were tasked with ensuring that the reporting of risks,
monitoring, measurement and management cuts across all spheres of operations.

At the beginning of the 2007/08 financial year, Risk Assessment workshops were facilitated
throughout the Organisation in line with the City of Johannesburg’s Risk Framework. This
resulted in the compilation and development of Corporate and Operational Risk Registers.
Risk interventions and timelines and Risk owners were agreed upon in the respective areas.
The implementation of risks identified in both the Corporate and Operational risk registers,
were closely monitored during the year. The implementation of the risk interventions resulted
in substantial movement on the residual risk exposure of some risks.

We are comfortable that the risks identified were managed to the desired level. The emerging
risks were also identified and closely monitored for both the Corporate and Operational Risk
Registers during the current financial year. The Company’s top five risks are being closely
monitored in order to bring the residual risks to the desired level.

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Internal Audit
The key role of the Internal Audit is to assist the Board and/or its Audit and Risk Committee in
discharging its oversight role through the review of systems and processes i.e. to evaluate the
adequacy and effectiveness of the internal controls within the Company. Internal Audit and
Risk Management Quarterly Reports were presented to the Audit and Risk Committee on a
quarterly basis. This enabled the Audit and Risk Committee to form an opinion on the
adequacy and effectiveness of the system of internal controls within the Organisation.

There were no significantly material internal control issues which came to the attention of
Internal Audit during the 2007/2008 financial year. Internal Control weaknesses or areas that
require improvement were discussed with management and appropriate recommendations
were suggested to mitigate any possible exposures or risks.

Human Resources
Human resources are a critical ingredient of our operational objectives and a significant
emphasis was placed on ensuring that we fully achieve on the skills plan objectives, provide
unique training programmes with emphasis being placed on succession planning and
retention.

Our employment equity targets are on track, training that was planned was achieved and
contributed to increased operational performance. The performance management system
which applies incorporates all facets of the strategic objectives and these were packaged into
the scorecards of all relevant employees. There are various recognition programmes outside
of the remuneration option which serve to encourage and motivate employees.

Women development was a priority. A number of women were part of a mentorship

programme which enabled them to develop under the mentorship of Executive and Senior
Management. All training, planned and delivered, for the reporting period was derived from the
Workplace Skills plan submitted to the AgriSETA at the beginning of the year.

Corporate Wellness phased in an Incapacity Management process to help Managers manage

sick leave, abuse thereof and absenteeism.
New programmes were identified for Corporate Wellness and the phasing in of the Quality of
Work Life strategy will be implemented to ensure organisational effectiveness for the new
financial year.

The absenteeism management programme was successfully implemented throughout the

Organisation. The managers and supervisors were trained across all disciplines in the

22
Company. The training assisted managers to understand, interpret and implement the
Absenteeism management reporting tool on a monthly basis.

Prospects
Our emphasis on trying to understand our stakeholders and customers better has enabled us
to pay more attention to their dreams and their realities, this is now clearly evident in how we
design all our new Parks and Cemeteries. Operating conditions will going forward create more
risks but we see an even greater opportunity to work together with our customers and attempt
more importantly to deliver on the 200 000 trees Mayoral Priority. In the years ahead we will
passionately attempt to pioneer the landscaping master-plan so to demonstrate to the world
that the City of Johannesburg has fully embraced it and will be catalytic in its approach to
environmental and greening matters. Emphasis will be placed on ensuring that our eco-
tourism products are re-designed, re-packaged and promoted to an extent that they could
significantly influence revenue.

Appreciation
A special thanks to the Board, Executive team and our Employees for their tireless
commitment and all their efforts of related and unrelated parties, who have contributed to the
excellent performance achieved in the last year. The skills that we have developed over time
will assist us to face the many challenges and create more opportunities in a global and
competitive environment. Our customers, who have continuously shown interest in our
products and services, can expect an even greater commitment to service delivery, with the
approach of the 2010 World Cup and beyond. A heartfelt thanks to our Sharemember for their
continuous support to the environmental projects and programmes.

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Section 6: Statement of Responsibility

The directors are responsible for the preparation, integrity and fair presentation of the financial
statements of JCP. The financial statements presented in Section 5 of this report has been
prepared in accordance with SA GAAP and includes amounts based on judgement and
estimates made by management.

The directors are responsible for the preparation of the other information in the annual report
and are responsible for both its accuracy and its consistency with the financial statements.
The going concern basis has been adopted in preparing the financial statements and based
on the forecast and available cash resources the directors have no reason to believe that the
entity will not be a going concern in the foreseeable future.

The Auditor-General, who was given unrestricted access to all financial records and related
data, including minutes of all meetings of shareholders, the Board of Directors and committees
of the Board, has audited the financial statements. The directors believe that all
representations made to the Auditor-General during their audit are valid and appropriate. The
Auditor-General’s unqualified audit report is presented on page 76 to 79. The financial
statements were approved by the Audit and Risk Committee on 27 August 2008 and signed by
the Managing Director Mr L.L. Williamson and the Chairperson of the Audit and Risk
Committee Mr T.B. Nzimakwe.

24
CHAPTER TWO: PERFOMANCE HIGHLIGHTS

Section 1: Highlights and Achievements

 LivCom awards
8 Awards were won in the International greening LivCom (Living Communities)
competition, of which 4 were gold.

 Trees planted
The focus this year was on tree planting in order to achieve the Mayor’s target of 200 000
trees to be planted by 2010. This year 49 245 trees were planted vs the initial annual plan
of 20 000 per annum.
In December 2007 the Mayor raised the target for annual trees to be planted from 20 000
to 50 000. The number of trees planted during Arbor Week in the next financial year, will
contribute towards the attainment of the annual target.
Collectively 90 738 trees have been planted vs the 2010 target of 200 000.
The survival rate of newly planted trees is 95%.

 “My Dream Park” competition

Three “My Dream Park” facilities were handed over to schools.

 External Services
An order book of R38 m was achieved vs an annual plan of R18 m.

 Customer Complaints
89% Of customer complaints were resolved vs a target of 72%.

 EPWP and job creation

1 133 EPWP jobs were created for the year vs an annual plan of 350 jobs.

 Xtreme Park in previously disadvantaged areas.

Development of the first Xtreme Park Makeover in Soweto at Immink Road, Diepkloof.

 Water fountains
There are now 68 functional water features in the City of Johannesburg, which exceeds
the annual target of 40.

25
 Beautification projects
The target of 30 Beautification Projects was exceeded by 9.

 Plant availability
Plant availability was 100% vs a plan of 95%.

 Fleet availability
Fleet availability was 99% vs a plan of 95%.

 Beneficiaries reached through environmental education

For the period under review, 19 684 beneficiaries attended various environmental
programmes, which exceeded the IDP target of 10 000 by 96%. An additional 30 214
households were reached during the tree survey as part of the greening of Soweto project.

26
Environmental Highlights

 Water Week Celebrations

City Parks, Paulshof Residents and Ratepayers Association and Toyota jointly conducted
clean up campaign sections of the Sandspruit and Braamfontein Spruit as part of the
Water Week celebrations

Environment and Conservation Development and the Marketing Department received an

invitation to exhibit and conduct interactive learners' activities during the Joburg Water
Festival held at Elka Stadium Soweto.

 Tree planting
Tree planting took place in Meadowlands as part of the Mayoral Legacy Project for 2010.

 Environmental theme days

Environmental theme days such as Water Week, Bird Week and National Environmental
Week were celebrated.

 Tree planting survey, and tree education

The Braamfischerville and Dobsonville Tree Planting Survey Report was completed, as
well as the Tree Education & Awareness Programme and draft After Care Programme.

 Greening of the workforce programme

The Greening the Workforce Programme was implemented with the theme “Alien Invasive
in our Facilities”.

27
Section 2: Financial Performance

The South African economic environment entered a year of instability with inflation breaching
the Reserve Bank’s range of 3-6% for much of the year and interest rates rising steadily
throughout the year. This was compounded by dramatic increases in fuel prices.

The Company was resilient and able to deliver an improved level of service to the community.

2.1.1 REVENUE

The Company posted revenue excluding interest of R426 m (2007: R368 m) for the year, an
increase of 15,8% over the previous year. The grant from the sharemember, the City of
Johannesburg Metropolitan Municipality, made up 85% (2007:91%) of total revenue received,
with an increase of 8,5% over the previous year. Revenue from cemeteries remain stable at
R15.5 m. External Services revenue resulting from grass cutting and tree pruning activities
with related parties grew by 179% to R42.3 m.

2.1.2 RESULTS OF OPERATIONS

Operational costs increased for the year by 16,8% to R415 m for the period (2007: R356 m).
The key contributing factor to this was the positive impact of the increased revenue streams
from External Services supporting the Mayoral 2010 Greening project of 200 000 trees.

The Company posted a deficit of R4.1 m for the period under review, against a surplus of
R9.6 m (restated) for the previous year. The contributing factors to the current deficit are as
reflected in the table on the following page.

28
Contributing factors to the current deficit:
R’000

Income: 15,692

External Services and Increased sales activities 14,865

cemeteries
Other Income Increased income 827

Cost of Sales Increased sales activities ( 10,027)

Expenditure: ( 7,389)

Payroll Prior year adjustments ( 1,810)

Fleet Increased interest rates and fuel prices ( 2,606)
Consulting Fees Increased activities (275)
General Expenses Tree Planting ( 3,043)
Depreciation and Amortisation FV 345
Repairs and maintenance Increased activity ( 2,321)

Investment Income Interest FV and Interest Paid ( 81)

( 4,126)

2.1.3 CASH FLOW

The Company ended the year in a favourable cash position and through effective cash flow
management and the previous year surplus, ended the year with cash on hand of R181 m
(2007 = R189 m). The decrease over the previous year was due to an investment of R11.3 m
in a new Head Office in Braamfontein.

29
2.1.4 STATEMENT OF FINANCIAL POSITION

Property, Plant and Equipment increased by a net R21.8 m to R59.2 m at cost. The increase
is due to the replacement of aging and obsolete operational equipment, and the refurbishment
of the Head Office.

The ability of the Company to meet its financial obligations remains stable with the current
ratio test remaining steady at 1, 51: 1 (2007 = 1, 67: 1).The decrease is largely due to the
investment in property, plant and equipment.

During the year, actuarial valuation of all employee benefits was undertaken. A company
specific valuation was done on some of the employee benefits, and the liability taken to the
Statement of Financial Position. The City of Johannesburg Metropolitan Municipality in the
Sale of Business Agreement agreed to accept all liabilities relating to these employee benefits
prior to January 2001. The value of this asset has been accounted for in the Statement of
Financial Position.

The valuation of the defined benefit pension funds was undertaken at member level and the
City of Johannesburg Metropolitan Municipality has accepted liability for all funding deficits up
to and including 30 June 2007. The Company will be liable for any further deficits that may
arise post 30 June 2008 when a company specific valuation is undertaken.

30
Section 3: Capital Projects

The Capex budget for 2007/8 is made up of R12.5 m CoJ Capex, R10 m MIG, R6 m Bulk
Contribution, R12.5 m Bulk Contribution for Beautification and R11.6 m for 2010. This
resulted in a R52.5 m Capex allocation for this financial year.

All the projects for 2007/08 have reached practical completion. Reflected expenditure is
inclusive of Retention and maintenance fees. Job opportunities of about 667 (Capex only)
have been created through the EPWP Programme that forms part of the projects execution.

Summary of the key areas of expenditure and funding source

Details Original Revised Actual

Budget Budget Expenditure

R’000 R’000 R’000

Capex 10 200 12 500 12 288

MIG 10 000 10 000 10 000

2010-KK 0 11 600 11 930

Bulk Contributions 6 000 6 000 6 562

Beautification 4 084 12 584 12 056
(Bulk Contribution)
TOTAL 30 284 52 684 52 836

The table above reflects total Capex expenditure.

31
 PROJECT/ INFRASTRUCTURE REPORT
Analysis of the Master Capital Programmes
PROGRAMME PROJECT COMPLETION
PROJECT PERIOD DATE

Start Date Duration Capex Community

Yrs R'000 Region No
Cemeteries and
Crematoria
Avalon July-07 1 2 000 D June 2008

Avalon 2 July-07 1 2 300 D June 2008

Diepsloot July-07 1 2 000 A June 2008

Lenasia July-07 1 2 000 G June 2008

New Park
Developments
Diepkloof July-07 1 2 000 D June 2008
Memorial
Diepkloof July-07 1 1 500 D June 2008
Extension
Chiawelo July-07 1 700 D June 2008
TOTAL 12 500

The above table indicates the Capex Masterplan as agreed with the COJ in the business
plan.UAC programmes shows alignment with the overall City’s Capital Investment
Programmes and it has been ensured that City Park’s programmes are aligned. This excludes
2010 projects.

32
NUMBER OF PROJECTS APPROVED PER AREA OF DEVELOPMENT
Project Category Approved Cancelled / Deferred Balance

New Park Development 4 0 4

Park Upgrades 4 0 4

Cemetery Upgrades 3 0 3

KK Programme 5 0 5

Bulk Contributions 7 0 7

TOTAL 23 0 23

The table above emphasises the number of projects to be executed in this financial year as
per the Business Plan.

JCP CAPEX 2007/8 SUMMARY

Project Project Original Revised Actual Project Zone Jobs
Name Description Budget Budget Exp. Status Created
R’000 R’000 R’000
Cemeteries and Crematoria
Avalon Cemetery 2000 2000 1 997 Complete 3 20
Upgrade
Avalon 2 Cemetery 2300 2300 2 197 Complete 3 0
Upgrade
Diepsloot Cemetery 2000 2000 1 933 Complete 4 16
Upgrade
Lenasia Cemetery 2000 2000 1 957 Complete 3 15
Upgrade
Park Upgrades
Diepkloof Park Upgrade 2000 2000 1 999 Maintenance 3 29
Memorial Phase
Park
Diepkloof Park Upgrade 750 *1500 1 506 Construction 3 29
Park 1284 Phase

Chiawelo Park Upgrade 700 700 699 Maintenance 3 39

Park Phase
Mapetla Park Upgrade 5000 5000 5000 Maintenance 3 217
Park Phase
Pioneer Park Upgrade 2550 2550 2550 Complete 4 86
Park

33
 Project Project Original Revised Actual Project Zone Jobs
Name Description Budget Budget Exp. Status Created
R’000 R’000 R’000
New Park Developments
Cosmo City New Park 2450 2450 2450 Maintenance 2 19
Parks Development Phase

2010- KK Programme
Open Mofolo & 0 7300 7 320 Practical 3 191
Space Dev. Mapetla Parks completion
Rehabilitation
Spatial EIA & Designs 0 3500 3 613 Complete Various 0
Layout and
Studies
Dorothy Construction 0 800 997 Practical 3 6
Nyembe of a Nursery in completion
Nursery Soweto
TOTAL 21 750 34 100 34 218 667

The table above summarises the Capex for 2007/8.

34
BULK CONTRIBUTIONS PROJECTS
PROJECT NAME WARD BUDGET SCOPE STATUS COMMITTED AMOUNT
R’000 FUNDS R’000 PAID
R’000

Weltevreden Park 89 500 Landscaping Complete 499 473

Midrand Cemetery 94 1000 Entrance gate & Practical 979 979

admin block completion
Rietfontein NR 94 2270 Refurbishment of Complete 2 270 2 269
office building &
building of multi
purpose hall
Witkoppen Park 94 1000 Park Practical 1000 1000
development completion
Innisfree Park 103 1000 Park Practical 572 572
development completion
Botanical Gardens 88 1191 Construction of Complete 1 259 1 115
the Entrance
Panorama 97 155 Building structure Practical 154 154
Cemetery for ashes completion
TOTAL 7 116 6 733 6 562

This table shows the projects funded by Bulk Contributions that have been implemented in the
current fiscal year 2007/ 08.

35
Beautification and road island development projects
NO Project Name Region Zone Completion Date Size of Work Description Project Cost Funding
2007-8 Project (Rands) Source

1 Golf Driving Range at Alexandra E 1 1st Quarter 300m Development of tee box, putting green & 136 000 JCP
target greens
2 Planting of trees at Alex Driving E 1 1st Quarter 300 trees Planting of 300 trees Street Trees
Range
3 Makhoarane Primary School D 3 1st Quarter 2500m2 1st Prize My Dream Park Competition- water 250 000 Total SA
feature, paving, grass, trees, playground
equipment & landscaping
4 Skeen Primary School E 4 1st Quarter 1000m2 2nd Prize My Dream Park Competition- 150 000 Total SA
paving, grass, trees, playground equipment &
landscaping
5 Ikaneng Primary School D 3 1st Quarter 1000m2 3rd Prize My Dream Park Competition- 100 000 Total SA
playground equipment & lanscaping
6 Rose Ave Park, Lenasia G 3 1st Quarter 10000m2 Planting of lawn, roses & general 161 000 JCP
infrastructure & horticultural development
7 Planting of trees in Noordgesig C 2 1st Quarter 500 trees Planting of 500 trees- Greening of Soweto JCP

8 Christiaan de Wet development C 2 2nd Quarter 850m Landscaping, trees, ornamental pots, lawn, 832 998 BULK
of road island at Clearwater Mall pebbles, jumbo rocks & irrigation

9 Development of Olievenhout C 2 2nd Quarter 1100m Water Feature, lawn, roses, ground covers, 709 103 BULK
street, Randpark Ridge palm trees, bollards, irrigation
10 Development of intersection- C 2 2nd Quarter 120m2 Planting of aloes & installing jumbo rocks 71 994 BULK
Christiaan de Wet/ Ontdekkers
11 Development of Linksfield Town E 1 2nd Quarter 7500m2 Development of water feature, landscaping, 520 363 JCP
Entrance planting of lawn, palm trees & plants.

12 Development of Katherine Street, B 4 2nd Quarter 570m Planting of roses, repairs to irrigation system, 170 000 BULK
Sandton cover with bark chips
13 Planting of trees, Marie Street E 4 2nd Quarter 60 trees Planting of 60 trees on road islands JCP
Parkmore
14 Kliprivier Road Pruning of Trees F 1 3rd Quarter 3km Pruning of trees JCP
between Booysens & Rifle Range
Road
15 Development of Glenvista Town F 3 3rd Quarter 1500m2 Horticultural development, water feature 198 098 BULK
Entrance
16 Development of Road Islands on F 3 3rd Quarter 2.5km Planting of trees on road islands and basic BULK
Bellairs Drive, Glenvista horticultural development
17 Extreme Park Makeover- D 3 4th Quarter 19000m2 Full Park Development- hard and soft 4 600 000 Capex/
Diepkloof landscaping, water feature, TV screen, etc. Sponsor

18 Cedar Road - Fourways C 2 4th Quarter 250 m Beautification of road islands-planting of 299 484 Bulk
trees and flower beds, paving and hardscape Contribution
work
19 Cedar Road - Witkoppen C 2 4th Quarter 350 m Beautification of road islands-planting of 388 878 Bulk
trees and flower beds, paving and hardscape Contribution
work
20 New Road - Midrand A 4 4th Quarter 1044 m Beautification of road islands- planting of 725 704 Bulk
trees and flower beds, paving and hardscape Contribution
work
21 Rivonia Road B 4 4th Quarter 450 m Beautification of road islands-planting of 500 000 Bulk
trees and flower beds, paving and hardscape Contribution
work
22 Katherine Street B 4 4th Quarter 300 m Extension of road island development, 151 000 Bulk
planting of roses Contribution
23 William Nicol Road C 4 4th Quarter 500 m Beautification of road islands-planting of 892 466 Bulk
trees and flower beds, paving and hardscape Contribution
work
24 Sandton CBD Area, Rivonia Road B 4 4th Quarter 330 m Beautification of road islands- development 317 935 Bulk
of flowerbeds Contribution
25 Main Road B 4 4th Quarter 300 m Beautification of road islands-development of 236 386 Bulk
flowerbeds Contribution
26 South Road, Wendywood A 4 4th Quarter 1200 m2 Beautification of road islands-planting of 163 536 Bulk
trees and flower beds, paving and hardscape Contribution
work
27 Six Street, Midrand A 4 4th Quarter 200 m Another venue to be identified by Zone 434 960 Bulk
Manager, Coubrough Road is not suitable for Contribution
development
28 Church Str, Midrand A 4 4th Quarter 420 m Development new Road Islands and planting 172 927 Region A
additional plants in existing Islands

29 Old Pta Road, Midrand A 4 4th Quarter 3 km Refurbishment of the Middle Road Islands, 156 604 Region A
planting of additional plants
30 Midrand Court A 4 4th Quarter 500 m2 Development of Garden Outside the Court, 169 814 Region A
including the installation of a Waterfeature

31 Bungalore Park, Lenasia G 3 4th Quarter 7000 m2 Development of a Park with a Waterfeature 200 000 Hort. Dev

32 Devland Park, Soweto D 3 4th Quarter 7500 m2 Development of a Park with a Waterfeature 600 000 Region D

33 Naledi Park, Soweto D 3 4th Quarter 2000 m2 Development of a Park with a Waterfeature 500 000 Region D

34 Meadowlands Park, Soweto D 3 4th Quarter 9000 m2 Development of a Park with a Waterfeature 700 000 Region D

35 Bram Fischer Park, Soweto C 3 4th Quarter 1 ha Development of a Park with a Waterfeature 277 707 Region C

36 Traffic Circle, Main Reef Road C 2 4th Quarter 300 m2 Developoment of circle plus a Waterfeature 40 000 Bulk

37 Krugersdorp / JHB Town C 2 4th Quarter 200 m2 Developoment of Town Entrance with a 20 000 Bulk
Entrance Waterfeature
38 Road Island, Main Reef / Corlett C 2 4th Quarter 100 m2 Development of Road Island plus a 45 000 Bulk
Road Waterfeature
39 Road Island, Main Reef / C 2 4th Quarter 200 m2 Development of Road Island plus a 25 000 Bulk
Highgate Waterfeature

36
The table on the previous page indicates a total of R15 m was spent in this financial year on
beautification projects with funding from various sources, including Bulk Contributions,
Sponsors, Regions and JCP Capex. Included in the list of projects completed were 24 road
island beautification projects and 11 park developments, including the very successful 24-hour
Extreme Park Makeover in Diepkloof.

Water Features reinstatement and development 2007-8

A total of 40 water features were reinstated / developed during 2007-8 resulting in a total of 68
operational water features in the City of Johannesburg for which the Company is responsible.
City Parks is therefore well on track towards achieving the target of 100 water features by
2010, as displayed in the figure below.

JCP Water Features Development & Reinstatement-

Progress against plan
80 68 68
70
60 54
47
50
40 33
28
30
20 10 13
10
0
YTD
2004-5 2005-6 2006-7 Sep-07 Dec-07 Mar-08 Jun-08 Sep-08 Dec-08 Mar-09 Jun-09 Sep-09 Dec-09 Mar-10
07-08
Target 0 0 15 5 8 13 14 5 5 5 5 5 5 5 5
Actual 10 3 15 5 14 7 14 40
Cumulative 10 13 28 33 47 54 68 68

37
Section 4: Performance against IDP and City Scorecard

Johannesburg City Parks had a very successful year in terms of performance and
achievement. Set out below, is an analysis of JCP’s performance against its KPI’s for the
2007/08 financial year as set out in the City’s IDP scorecard. The report analyses the
performance of JCP in terms of the IDP scorecard, measuring performance in terms of both
JCP’s impact and its financial and resource management.

Targets exceeded

Key Performance Area: Service Delivery

JCP exceeded the following service delivery targets:

1) The target of 10 000 for the number of mature, indigenous trees to be planted, was
exceeded by 39 245 trees.

2) The following two targets for maintenance cycles were exceeded due to increased
maintenance in specific areas as a result of a special effort to increase service delivery:
 Road island maintenance cycles were improved from 60 days to 40 days on average; a
variance of +33%.
 Side walk’ maintenance cycles were improved from a target of every 120 days to an
average of 100 days; a variance of +16.6%.

3) The target of 3 developments in cemeteries were exceeded, as 4 developments were

done.

Key Performance Area: Occupational Health, Safety and Security

1) The target of 10 for the number of security interventions by the Park Rangers was
exceeded by 21 interventions.

38
Key Performance Area: Economic Development and Job Creation

1) In terms of BEE procurement, the Company exceeded both its total expenditure as
well as Operating targets: the total BEE expenditure target of 70% was exceeded
with an actual of 87% having been achieved and the Capex target of 70% was
exceeded with an actual of 84%.

2) JCPs’ EPWP programme performed well and the annual target of 350 for job
creation was exceeded with 1 133 jobs being created.

Key Performance Area: Customer Satisfaction and responsiveness

1) The annual customer satisfaction index rating’s target of 70% was well exceeded
with an actual rating of 78%.

2) The target of 10 000 beneficiaries reached through environmental education

programmes was exceeded with 9 684 beneficiaries being reached.

Key Performance Area: Safe, Clean and Green City

1) A target of 2 was set in terms of the number of Conservation Areas initiated for
re-proclamation as Nature Reserves. This was well exceeded as a number of 16
applications were initiated.

2) The target of 5 for areas in Regions to be initiated in which parks and open spaces
can be appropriately rezoned to reserve the land, was exceeded as 18 areas were
initiated.

3) Compliance to OHASA checklist. The percentage compliance with the OHASA

checklist: the target of 85% compliance was exceeded with 90% having been
achieved.

39
Targets achieved

JCP achieved the following IDP targets:

Key Performance Area: Service delivery

 Maintenance cycles of 7 days for flagship parks were achieved

 Maintenance cycles of 21 days for developed parks were achieved
 Maintenance cycles of 60 days for undeveloped parks were achieved
 Maintenance cycles of 14 days for selected main arterials were achieved
 Target for 3 developments in parks were achieved

Key Performance Area: Occupational Health, Safety and Security

 Percentage Compliance with Environmental Management System: the target of 90%

compliance was achieved.

Key Performance Area: Effective Financial Management

 Fully SA GAAP compliant asset register: the target of 100% compliance was achieved.
 Reconciliation of inter-company balances with the CoJ: the target of 100% compliance was
achieved and maintained.
 Reconciliation of intra-company balances with other Metropolitan Entities: the target of
100% compliance was achieved.
 Percentage attainment of clean Audit Report attained by JCP: the target of 100% was
achieved.

Key Performance Area: Customer Responsiveness

 Number of monitoring reports on maintenance of parks: the target of 1 per quarter was
achieved.

40
Key Performance Area: HIV and AIDS

 100% of the workforce had been exposed to HIV and AIDS awareness programmes.

Key Performance Area: Staff Development

 Percentage Skills training as a percentage of payroll budget: the 1 % target was achieved.

Targets partially achieved

Key Performance Area: Effective Financial Management

 Percentage of ME’s Capital budget spent: JCP spent 100,1% of its Capital budget
against a target of 100%.
 Variance against ME’s operating budget 2,3% versus a target of 0% variance. This was
due to extra revenue received that resulted in high input costs and increased service
delivery.

41
Section 5: Assessment of Arrears on municipal taxes and service charges

5.1 Amounts owed by JCP for service charges

Name of entity Amount Status Comments

Owed
R’000
City of 2,177 Amount provided for in Current
Johannesburg JCP’s books
City Power 686 Amount provided for in Current
JCP’s books
Jo’burg Water 4,364 Amount provided for in Current plus accounts
JCP’s books under dispute relating to
transactions from prior
years
Piki Tup 137 Amount provided for in Current
JCP’s books
Propcom 5 Amount provided for in Current
JCP’s books
Jo’burg Zoo 16 Amount provided for in Current
JCP’s books
Civic Theatre 2 Amount provided for in Current
JCP’s books

All accounts are current as at 30 June 2008 payable in July 2008, except for Jo’burg Water,
where certain billings are investigated.

42
5.2: Assessment of Director’s and senior managers’ municipal accounts

Name of Designation Name of Municipal Account Comments

Director/ Senior Municipality Account Name & Status
Manager Account Number
G Zabala Chairperson of Johannesburg G Zabala In order
the Board 900706021
L L Williamson Managing Johannesburg LL Williamson In order
Director 900104563
HC Kasan Non-Executive Johannesburg Kasan HC In order
Director 500065574
K Venier Non-Executive Johannesburg No personal In order The Property
Director municipal account Managers
Body Imbali
Lodge Body
Corporate
BS Ritchken
Ref. nr. 52701
V Ramsing Non-Executive Midvaal VB & GH Ramsing In order
Director 40000786
M Bahula Non-Executive Johannesburg M Bahula In order Glenvista
Director G063 Village
Complex
A C Carolissen Non-Executive Tshwane Carolissen AC & In order
Director AL
2068458900
2028316835
N Mabaso Non-Executive Johannesburg Mabaso TM & NN In order
Director 400764321
S M B Nyalunga Non-Executive Tshwane Nyalunga SMB In order
Director 2079410101
T B Nzimakwe Non-Executive Johannesburg Nzimakwe In order
Director 206922545
G Cooke Operations Johannesburg Cooke G &VW In order
Executive 206747903
H H Fouche Marketing & Johannesburg Fouche BN In order
Communications 502444401
L Radzuma GM: Assurance Johannesburg No personal In order Sectional Title
Services municipal account Pipers Brook
Body
Corporate
NL Radzuma
4210/0019
K J van Eck Chief Financial Johannesburg K J van Eck In order
Officer 202029210
M Sayed Company Johannesburg M Sayed Hassan In order
Hassan Secretary 504120480
P Meyer Operations Johannesburg Meyer PS & MD In order
Executive: 302336913
Environment and
Infrastructure
A Buzo- Human City of No personal In order Sectional Title
Gqoboka Resources Ekhuruleni municipal account
Executive

43
Section 6: Statement on amounts owed by Government Departments and public entities

Name of entity Amount Owed Status Comments

R’000
NIL NIL NIL NIL

44
Section 7: Recommendations and Plans for the next financial year.

Recommendations and plans for 2008/9

Tree planting plan for 2010

The planting of 200 000 trees by 2010 remains a challenge in terms of financial resources and
the availability of trees in the market. Johannesburg City Parks is trying to collaborate with the
private sector in an effort to obtain financial resources for trees.

Delivery Agenda 2008

The planting of 62 000 trees in 2008/9 as well as the beautification projects for 2010 will take
high priority.

Environmental Sector Plan

As for the Environmental Sector Plan, the management of wetlands, dams and other water
bodies inter alia will comprise of the following projects:
 Removal of aquatic invasive plants from water bodies (mainly hyacinth)
 Maintenance and control of reeds
 Maintenance of bird sanctuaries, river trails and corridors.

With regard to the biodiversity protection programme, projects will inter alia include the
following:
 Development and implementation of ecological master plans for selected nature areas
 Zoning of selected priority open spaces
 Implementation of open space biodiversity education programmes.

Challenges for 2008/9

A challenge for 2008/9 is the provision of burial space in the South and financial resources for
the Klipriver/ Klipspruit Corridor Legacy projects. Also, new Capex developments without
Opex for the maintenance thereof remain a challenge.

45
CHAPTER THREE: DIRECTOR’S REPORT AND GOVERNANCE

Section 1: Corporate Governance Statement

The Board of Directors and Executives recognise and are committed to the principles of
openness, integrity and accountability advocated by the King Committee’s Code of Corporate
Practices and Conduct. Corporate Governance within Johannesburg City Parks is managed
and monitored by a unitary Board of Directors, several Board committees and the Executives.

The Board is of the opinion that the Company currently complies with the principles
incorporated and enunciated in the Code of Corporate Practices and Conduct, as set out in
the King Report ll.

Section 2: Board of Directors

The Board is chaired by a non-executive director, Mr G Zabala, and consists of nine non-
executives and one executive director, the Managing Director, Mr L L Williamson. There were
no changes in the directorship of Johannesburg City Parks during the period under review.

The Board remains responsible to the CoJ, the sole member, in the exercise of its duties.
Johannesburg JCP is accountable to its stakeholders, the Johannesburg Citizens and its
parent municipality. A Service Delivery Agreement (SDA) concluded in accordance with the
provisions of the Municipal Systems Act governs JCP’s relationship with the CoJ. The Board
provides Monthly, Quarterly, Bi-Annually and Annual Reports on its performance and service
delivery to the parent municipality as prescribed in the SDA, the MFMA and the MSA.

Non-executive Directors contribute an independent view to matters under consideration and

add to the depth of experience of the Board. The roles of Chairperson and Managing Director
are separate, with responsibilities divided between them. The Chairperson has no executive
functions.

Board meetings are held at least quarterly, with additional meetings called where
circumstances necessitate.

Members have unlimited access to the Company Secretary, who acts as an advisor to the
Board and its committees on matters including compliance with Company Rules and
Procedures, statutory regulations and sound corporate governance.

46
The Board or any of its members may, in appropriate circumstances and at the expense of the
Company, obtain the advice of independent professionals.

During the course of the financial year, the Directorship and skills base was used to determine
the appropriate committees of the Board and the membership thereof. These changes to the
committees of the Board resulted in more diligent monitoring of performance and guided the
company strategy.

To this end, the Corporate Strategy was reviewed early in 2008 and a new corporate strategy
was developed. All the Operational areas reviewed their Key Performance Areas and were
aligned to the Corporate Scorecard which was geared towards accountable service delivery.

The Audit & Risk Committee which meets regularly and has there Independent Non-Executive
Directors over and above the two non-executive directors who sit on the board continued to
emphasize the balance of the portfolio. In addition, specific attention was drawn to
performance as envisaged in the Municipal Finance Management Act of 2003.

The Committee of Chair’s, chaired by the Chairperson of the Board reviewed matters
considered by the committees and advised the Board Agenda. The Committee’s membership
comprises of the chairpersons of the various committees of the Board who present on all
matters considered and deliberations which took place at committee level. This provides an
opportunity for members of the Board to be better advised of company matters prior to Board.

The following committees had existed at the beginning of the year, each of which is chaired by
a non-executive director:
 Audit and Risk Committee
 Remuneration Committee
 Committee of Chairs
 Marketing Committee
 Human Resources Committee
 Finance and Operations Committee
 SHEQ Committee

At the end of the Year, the Finance and Operations Committee and the SHEQ Committees
had been restructured to Finance and SHERQ Committee and Operations Committee.

47
Attendance at meetings held during the year was as follows:

Attendance at meetings AGM Board Audit Remune Committee Finance Human Marketing SHEQ
held during the year was and -ration of Chairs and Resource
as follows: Risk Operations s

No. of meetings held 1 6 6 4 4 4 6 4 4

G Zabala#
(MA) 1 6 4 4
L Williamson
(MC) Managing Director 1 5 6 4 4 1 5 1 1
A Carolissen
(MC) 1 6 1 4 3 4
N Mabaso
(FA) 5 4 4 1 5 4
SMB Nyalunga
(FA) 1 5 1 3 3
TB Nzimakwe
(MA) 1 6 6 4 2 1 6
VB Ramsingh
(MI) 1 5 3 4 6 4
K Venier
(FW) 1 5 4 1 1 3
H Kasan
(MI) 1 5 1 4 4
M Bahula
(MA) 1 6 3 3

F Female A African W White

M Male C Coloured I Indian
# Chairperson

For details, refer to the previous pages.

48
The Board of Directors has adopted the Board Charter, which encapsulates the City of
Johannesburg’s Governance Protocol and includes matters of ethics, procedure and the
conduct of committee members. Registers are kept and updated on the disclosure and
declaration of interests of directors and senior management.

The Board and Senior Management ensure that there is full material compliance to all
relevant legislation. The Company Secretary has certified that all statutory returns have
been submitted to the Registrar of Companies

49
Section 3: Board Committees

The following committees have been formed, each of which is chaired by a non-executive
director.

 Audit and Risk Committee

The Audit Committee was chaired by Mr T Nzimakwe who is an independent non-
executive director of the Company.

The Committee has been established, in line with the King reports recommendations on
Corporate Governance, with the goal of deliberating and taking decisions on matters
relating to the Company’s Finances, Strategy and policies.

 Remuneration Committee
The Remuneration Committee was chaired by Mr G Zabala, the Chairperson of the
Board of Directors and comprises of the Chairpersons of the Committees of the Board,
who are all independent non-executive directors of the Company.

The Committee has been established, in line with the King reports recommendations on
Corporate Governance, with the goal of considering and recommending to the Board of
Directors on matters pertaining to the remuneration packages of executives and
employees.

 Committee of Chairs
The Committee of Chairs was chaired by Mr G Zabala, the Chairperson of the Board of
Directors.

The Committee has been established with the goal of maintaining and guiding the
strategic direction of the company of reviewing the reports and matters considered by the
committees of the Board. To this end, the committee is attended by the Chairpersons of
the various committees.

50
 Finance and SHERQ Committee
The SHEQ Committee was chaired by Mr A Carolissen who is an independent non-
executive director of the Company.

The Committee has been established with the goal of considering matters relating to the
Financial affairs of the company as well as the Occupational Health and Safety and
Environmental impact of JCP’s operational activities.

 Human Resources Committee

The Human Resources Committee was chaired by Mr V Ramsingh who is an
independent non-executive director of the Company.

The Committee has been established with the goal of considering matters relating to the
conditions of service and employer-employee relationship.

 Marketing Committee
The Marketing Committee was chaired by Ms N Mabaso who is an independent non-
executive director of the Company.

The Committee has been established to develop and manage the company’s reputation
and exposure through policy development and marketing initiatives.

 Operations Committee
The Operations Committee was chaired by Ms S.M.B Nyalunga who is an independent
non-executive director of the Company.

The Committee has been established with the goal of considering ad recommending to
the Board on matters relating to the Company’s operational activities, policies, service
delivery and Information Technology solutions.

51
Section 4: Directors’ Remuneration

Executive Director

2008 2007
R’000 R’000 R’000 R’000 R’000

Position Salary Travel Bonus Total Total

LL Williamson Managing Director 1 247 32 255 1 534 981

Non- Executive Directors

Name Directors Fees

R’000
G Zabala 231
A Carolissen 109
M Bahula 85
N Mabaso 106
SMB Nyalunga 81
TB Nzimakwe 158
V Ramsingh 129
K Venier 91
H Kasan 89
Total 1 079

52
Senior Management

2008 2007
Position R’000 R’000 R’000 R’000 R’000

Position Salary Travel Bonus Total Total

G Cooke Operations Executive 875 80 191 1 146 1 112

HH Fouche Marketing and Communications

Executive
795 91 177 1 063 999

HG Nel Company Secretary (resigned 31 - - - - 999

May 2007)

DT Nkosi Human Resources Executive - - - -

(resigned 30 April 2007)
861

L Radzuma General Manager: Assurance

Services (appointed June 2006)
591 55 64 710 561

KJ van Eck Chief Financial Officer 835 120 191 1 146 1 076

B Andrews Acting Human Resources

Executive (July to November
228 20 51 299 118
2007)

A Buzo-Gqoboka Human Resources Executive 454 42 99 595 -

(Appointed 1 December 2007)

M Sayed-Hassan Acting Company Secretary

(appointed 1 September 2007)
378 54 90 552 55

P Meyer Operations
Executive:Infrastructure
65 7 172 244 298
(appointed 1 June 2008)

4 221 469 1 035 5 725 6 079

53
Section 5: Company Secretarial Function

The Company Secretary is responsible for the following areas of Johannesburg City Parks’
business:
 Corporate Governance
 Legislative & Statutory Compliance
 Secretarial
 Legal Advice
 Safety, Health, Environment and Quality (SHEQ)

In terms of protocol arrangements, the MoE’s (including Johannesburg City Parks) liaise with
the Office of the City Manager through the SHU on governance and compliance issues and
service delivery matters.

The Company has complied, and is in compliance, with the Companies Act and all other
applicable legislation. The Company simultaneously strives to comply with the King Reports
on Corporate Governance and the new amendments to the Municipal Finance Management
Act (MFMA) and the Municipal Systems Amendments Act.

The Company Secretary has in addition ensured that the Directors of the Company were
advised of their roles, duties and responsibilities.

The Company registers and related statutory requirements have all been maintained as
required by the Company’s Act and best practice.

54
Section 6: Risk Management and Internal controls

Risk Management within Johannesburg City Parks is a process, effected by the Board of
directors, management and other personnel, applied in a strategy setting and across the
company, designed to identify potential events that may affect the company, and manage
risk to be within its risk appetite and to provide reasonable assurance regarding the
achievement of the company’s objectives.

Risk Management Unit

The key risks facing Johannesburg City Parks have been classified according to the
following nine broad risk categories: strategic, financial, human capital, mayoral priorities,
environment, regulatory, reputation, technology and labour.

The following risk management activities were undertaken during the year under review:

RISK ASSESSMENT

Corporate and Operational risk assessments have been completed for all areas within
Johannesburg City Parks. Risk registers have been prepared for all departments and are
updated on a quarterly basis in terms of any changes and progress made on actions taken
to improve management of identified risks. The status of the risk registers are
communicated to The Audit and Risk Committee and Operations Committee on a quarterly
basis.

DISASTER MANAGEMENT AND BUSINESS CONTINUITY

Disaster Management Plan

The current year has noted a significant improvement on the implementation of the disaster
management within the organization. The disaster management plan was reviewed and
approved by the Board during the second quarter.

55
Business Continuity Plans

A highlight for the financial year under review has been the development of business
continuity plans for the business functions identified as critical to the continuity of
Johannesburg City Parks Operations.

The process entailed identifying mission critical activities, conducting risk assessments and
selecting the suitable strategies. Possible business disruptions in each department were
identified and appropriate continuity plans were also developed. The finalized continuity
plans have been submitted to the Executive Committee for consideration and will further be
tabled before the Audit and Risk Committee for recommendation to the Board for approval.
This process is expected to be finalized in the first quarter of the new financial year.

Training

The disaster management team members were formally appointed and trained. Training still
needs to be conducted at a lower level.

Disaster Management and Emergency management Forums

Disaster and Emergency Management Forums were formally established. This is line with
the Disaster Management Framework. These forums will be used as a platform to deliberate
on all Disaster and Emergency Management issues of the Company and to make
appropriate recommendations, where necessary. The Disaster Management forum is mainly
represented by General Managers and Managers from Operations and other departments,
while the Emergency Management Forum comprise of Specialists, Zone managers and
SHERQ co-ordinators.

The focus in 2008/09 financial year will be on training the Emergency Management
Committees in the depots and to roll out the Operational Emergency Management Manual.

Disaster Risk Assessments

Disaster risk assessments for twenty five (25) sites were conducted and the Emergency
Management Manual was developed for the Operations department.

56
Risk Control Standards

The City Of Johannesburg’s Risk Control department introduced Risk Control Standards for
all municipal entities. The standards are considered vital in the prevention or minimisation of
the daily threats faced by our Operations environment. The standards mainly focus on the
following areas: Risk Management, Security, Motor fleet, Legal liability in terms of OHSACT,
Fire defence and Emergency planning. A minimum level of 85% compliance is required in
each Municipal Entity. The CoJ Risk Control department also conducted site assessments in
the selected facilities, with the aim of identifying levels of compliance to the Risk Control
Standards in our organization. According to the reports obtained, the safety and risk
standards for the three depots (namely, depot 406 & Springfield – Facilities Management,
Cemeteries & Crematoria) assessed were found to be fairly managed.

The CoJ Risk Control department also conducted presentations on the Risk Control
standards to the Specialists and SHERQ coordinators.

RISK FINANCING

There has been a reasonable reduction in losses for the current year based on a quarter per
quarter analysis except for the second quarter. The huge variance in the second quarter
relates to major event claims resulting from hail storms as well as the theft of cables within
various facilities. Majority of the claims were assets claims as a result of damaged and
stolen fence, theft of computer equipment, etc.

Management is continuously developing and enhancing its risk and control procedures to
improve the mechanisms for identifying, evaluating and monitoring risks.

57
Section 7: Internal Audit Function

The Board has the overall responsibility for the Company’s system of internal control. The
responsibility has been delegated to the Audit and Risk Committee. The Audit and Risk
Committee exercises this oversight role on internal controls through the review of quarterly
audit and risk reports.

Internal Audit is an integral part of Johannesburg City Parks. It is an independent appraisal

function to examine and evaluate the Company’s activities. The primary objective of the
Internal Audit is to provide assurance on the adequacy and effectiveness of systems of
internal controls, risk management and governance processes.

In terms of section 165 (1) of the Municipal Finance Management Act (MFMA), each
Municipal Entity must have an internal audit unit. It is functionally responsible to the Audit
and Risk Committee and reports administratively to the Managing Director in providing
reasonable assurance of the effectiveness of the Company’s corporate governance, risk
management processes and the system of internal control.

The Company’s internal controls and systems are designed to provide cost effective,
reasonable, but not absolute assurance as to the integrity and the reliability of the annual
financial statements and that assets are adequately safeguarded against material losses or
unauthorized losses and transactions are properly authorized and recorded. Management
ensures that internal controls are embedded as part of the daily operational activities.

Areas of improvement identified in some of the audits conducted during the course of the
year. Management has committed to implement recommendations agreed upon and in our
opinion; this will contribute to an improvement of the internal control environment and
effective governance processes.

Section 165 (2) (a) of the Municipal Finance Management Act (MFMA) specifically states
that each municipal entity must prepare a risk-based audit plan for each financial year.
Therefore, key risks identified by management during the corporate risk assessment, which
could be detrimental to the attainment of strategic objectives were considered in the
development of the plan. The plan was approved by the Audit and Risk Committee and
successfully implemented. The plan enabled the unit to evaluate the effectiveness of
internal controls, risk management and governance processes.

58
Section 8: Response to the Auditor-General Report
The Auditor General raised the following issues for the year-ended 30 June 2007. The
following is the status report as at 30 June 2008.

1. Recognising revenue and or expenses based on the stage of completion of the

project
The nature of JCP’s business is to provide the parks, cemeteries and environmental
conservation services for and on behalf of the City of Johannesburg and other Municipal
Owned Entities (“MOE”). Many of these services are rendered on a project basis, as well
as contracting in external service providers where JCP has a shortfall in recourses.

Thus revenue is earned and project costs incurred on various projects. We have noted
that the revenue generated from MOE’s, as well as the expenses incurred for external
contractor services procured, were not recorded on a stage of completion basis as
required by IAS 18: Revenue (refer paragraph 20(c)). This standard requires
management to record all revenue earned, as well as the matching expenses incurred on
a time basis, reflecting the stage of completion of the project, and not only when amounts
are invoiced to the relevant MOE, or when invoices are received from the external
contractor.

Current Status: This matter has been resolved.

2. Long duration of vacancies

When we inspected the vacancy listing for the period 1 July 2006 to 30 June 2007, we
identified vacancies that were not filled for longer than the norm of 3 months (65 working
days).
The following vacancies were open for longer than 65 days (in order: department;
position):

 Finance: Fixed Assets Officer; and

 Project management: Project Coordinator

Current Status: This matter has been resolved.

3. Fix asset labels

The following asset selected for physical verification was found not to have a label:

Asset ID Description Acquisition Cost Acquisition date

509-000003 DIGITAL COPIER 1018 R 22 869.00 19/08/2001
AFICIO

It must be noted that we did not perform a full review of the fixed asset register to identify any
other such unlabelled assets.

Current Status: This matter has been resolved.

59
Section 9: Corporate Ethics and Organisational Integrity

JCP places a high premium on sound ethical behaviour and integrity, which should be
beyond reproach. To achieve this, the Board adopted a Code of Conduct and a Charter
encapsulating sound governance and an ethical approach to the way its directors, officers
and employees conduct business internally and externally. This Charter subscribes to the
principles set out in the King Reports ll.

In addition to the above, the organisation is structured in a manner that sees clear and
material observance of the Municipal Structures Act, Municipal Systems Act and Municipal
Financial Management Act, as well as other pertinent legislation including the Companies
Act, Labour Relations Act, Occupational Health and Safety Act and financial/tax legislation.

The Audit and Risk Committee, consisting of independent non-executive directors as

members as well as three additional independent members appointed by the member,
oversees and considers audit matters and risk management issues.

From the outset of the Company’s existence, there has been a clear system of delegated
authority in place, which has a set framework for the organisational structure and executive
implementation supported by the appropriate committee structures.

All the above support the regular assessments of governance and legislative compliance
reflecting a positive status in relation to ethics and organisational integrity.

60
Section 10: Sustainability Report

Johannesburg City Parks trades in a solvent position and it is not anticipated that this will
change. As is required by the MFMA, JCP has an approved budget and receives regular
subsidy payments from the CoJ. The Board of Directors, and specifically the Audit and Risk
Committee, consider the aspect of trading as a going concern and consider the Financial
Reports.

Human development receives high priority with training a special focus aimed at not only
enhancing productivity and service delivery, but also the empowerment and skilling of
employees and through the EPWP, community members. The employees of JCP are
regarded as an extremely valuable asset and are treated in a caring manner.

By its very nature, JCP is focused on the social and environmental issues, which are
paramount for the development of a large metropolis and the approval of its inhabitants’
wellbeing. The development of parks and nature areas, especially in the previously
disadvantaged areas, receives specific priority. It is acknowledged that the taking care of
ancestors and ensuring a suitable final resting place for them, is especially important to
many of the cultures represented in the community and JCP has ensured that sufficient
burial space is provided both in the immediate and long term.

61
Section 11: Corporate Social Responsibility Projects

 Ernest W. Hobbs Primary School Tree Planting

Johannesburg City Parks donated 6 trees to Ernest W. Hobbs Primary School in

Eldorado Park, Extension 2. Learners planted trees in celebration of and highlighting the
importance of Arbor Week.

 My Dream Park Prize Competition

The competition is aimed at educating, inspiring and instilling in learners the importance
and value of nurturing our public open spaces, while acting as a catalyst to build civic
pride.

 International Day of the Disabled Person

Christmas in the Park, the theme of the party held to mark International Day of the
Disabled Person and to highlight the plight of disabled people. Johannesburg City Parks
and Cell C adopted the initiative as part of a strategic vision to ensure that all outdoor
recreation facilities cater for the disabled. Johannesburg City Parks and its private sector
partner, Cell C, held an early Christmas party for more than a thousand disabled
children. Zola 7 and Lesego Motsepe from Isidingo joined the festivities.

 World Wetlands Day

World Wetlands Day is marked each year around the world on 2 February. The aim of
the day is to spread the message of the importance of preserving wetlands and serves to
emphasize the value of wetlands on the biodiversity and human wellbeing. 2008's theme
focused on the importance of well-functioning wetlands in ensuring human health and
wellbeing by managing diseases, creating space for recreation, providing clean water,
food and medicine.

 Diepkloof Xtreme Park

The countdown for the Diepkloof Xtreme Park, which poised to become the leading
outdoor recreation hub in the Southern quadrant of Johannesburg, began on Thursday, 8
May 2008 at 18:00. The project was designed to act as a catalyst and to ready Joburg’s
communities for the 2010 FIFA World Cup. In just 24 hours, the inviting green park with a
big screen television, sports field and other exciting outdoor facilities was ceremonially
opened by the Executive Mayor of Johannesburg.

62
 Take a Girl Child To Work Day
Johannesburg City Parks Head Office and Various Depots
A partnership project between Johannesburg City Parks and Cell C with the sole aim of
exposing girl children to various areas of their aspired or desired career choices, and
thus allowing them to ensure that career selection enhances their personality, their ability
to endure challenges and can therefore survive in such an environment in future.

 Environmental Youth Summit – KNR Kibler Park

The 2008 theme was “ALL HANDS ON DECK: TOWARDS LOW CARBON
ECONOMY” and our key messages were:

1. Waste Management
2. Climate Change
3. Bio-diversity
4. Energy Efficiency

63
-

CHAPTER FOUR: HUMAN RESOURCES AND ORGANISATIONAL MANAGEMENT

Section 1: Human Resource Management

The human resources strategy in JCP focuses on attracting and retraining staff with key skills and
competencies which will assist the company in achieving its objectives. To this end it seeks to create
a sound industrial relations environment and sustainable employee wellbeing. The focus is also on
dynamic training and development programs aimed at succession planning, retention and increased
skills and productivity. Management encourages employees to think innovatively which is evidenced
by the entries submitted to local and international awards programmes which focus on environmental
management and the creation of liveable communities. In both instances JCP employees have been
nominated for outstanding contributions made with regards to the implementation of projects in local
communities.

The company participates in the annual salary surveys run by reputable external remuneration
consultants to ensure that it remains competitive in its remuneration policies and practices and that
our pay scales are in line with market rates. We remain cognisant of the requirements of the relevant
legislation such as the MFMA and also the CoJ’s policies.

The table below indicates expenditure on salaries over the last 3 years:

2007/8 2006/7 2005/6

R’000 R’000 R’000

Total expenditure 415 453 355 660 316 607

Total payroll expenditure 273 040 240 943 212 494

The table below indicates the total payroll expenditure over the last 3 years as a % of the total budget:

2007/8 2006/7 2005/6

Payroll expenditure as a % of total 66% 68% 67%

budget

64
Age analysis
AGE NUMBER OF OPERATIONS NUMBER OF SUPPORT COMPANY COMPANY
EMPLOYEES EMPLOYEES SERVICES
OPERATIONS % SUPPORT % TOTALS %
SERVICES
61-70
75 4.57% 2 1.27% 78 4.3%
51-60
671 40.86% 35 22.29% 708 39.2%
41-50
656 39.95% 42 26.75% 701 38.8%
31-40
209 12.73% 51 32.48% 262 14.5%
21-30
31 1.89% 27 17.20% 58 3.2%
15-20
0 0% 0 0.00% 0.00 0.00%
TOTAL
1642 91,2% 157 8,8% 1799 100.00%

The majority of the company’s workforce is in the age categories 51-60 and 41–50. These two
categories represent approximately 77% of the company’s workforce. The company is cognisant of
the possible implications of the age profile on productivity and service delivery challenges, and has
investigated alternatives to mitigate this.
NO OF STAFF PER FUNCTION (30.06.2008)

DEPARTMENT COMPLEMENT FILLED VACANT

Parks 995 987 8
Street Trees 199 196 3
Project Management Unit 13 11 2
Cemeteries 195 156 3
External Services 11 11 0
Technical Training 6 5 1
Facilities Management 147 158 11
Environmental Conservation 120 118 2
Marketing & Communication 57 56 1
Human Resources 27 26 1
Finance 48 46 2
Office of the MD 21 21 0
Company Secretariat 8 8 2
Company Totals 1847 1799 35

The table above indicates number of employees per function.

65
Section 2: Employment Equity

The following Employment Equity Targets were set in 2003 for a period of 5 years, based on the
economically active population for Gauteng.
Employment Equity targets as set in 2003
Target - Male Target - Female Total PDI PDI %
Categories Total
A C I W A C I W
Executives 1 1 0 2 1 0 1 0 6 4 66

General 4 0 0 1 1 1 0 1 8 7 87
Managers
Middle 14 6 2 14 5 4 2 4 51 37 72
Management
Professionals 17 1 1 8 8 0 1 3 40 31 77
Technicians 6 1 0 8 5 0 1 2 23 15 65

Employment equity as at 30 June 2008

Target - Male Target - Female Total PDI PDI %
Categories Total
A C I W A C I W
Executives 1 2 1 2 1 0 0 0 7 5 71

General 2 1 0 3 3 1 0 0 10 7 70
Managers
Middle 12 5 0 8 6 2 1 3 37 29 78
Management
Professionals 15 1 0 7 22 0 1 3 49 36 85
Technicians 13 2 0 8 5 0 1 1 30 22 73

As can be seen from the above table, our performance is still on track based on our 2008 targets.
Our focus then was based on redressing the situation at management levels, i.e. levels 2 – 4, which
were predominantly white male at the time. Significant progress has been made in all of the above
levels but increasing the female ratio at management level remains a priority for the organisation. In
addition, the company will be reviewing its targets in the new year as we have completed the current
5 year cycle. 93% of all appointments during this financial year were from designated persons in
previously disadvantaged groups, of which 59% was female and 78.2% African.

66
Employment Equity breakdown by Category (as at 30 June 2008)

WHITE FOREIGN
MALE FEMALE
MALE NATIONALS
OCCUPATIONAL
A C I A C I W W Male Female
LEVELS
Top Management 0 1 0 0 0 0 0 0 0 0 1
Senior Management 3 1 1 2 0 0 0 4 0 0 11
Professionally
qualified and
experienced 11 6 0 9 3 1 1 10 0 0 41
specialists and mid-
management
Skilled technical and
academically
qualified workers,
junior management, 46 8 2 34 7 7 11 21 0 0 136
supervisors,
foremen and
superintendents
Semi-skilled and
discretionary 503 13 4 69 4 0 6 12 0 0 611
decision making
Unskilled and
defined decision 940 5 1 51 0 0 0 0 0 0 999
making

Total Permanent 1503 34 8 165 14 8 18 47 0 0 1797

Non-permanent
1 0 0 1 0 0 0 0 0 0 2
Employees
GRAND TOTAL 1504 34 8 166 14 8 18 47 0 0 1799

67
Section 3: Skills Development and Training

Training planned and delivered during the period under review was aligned to the company’s overall
objectives of improved service delivery and stakeholder satisfaction. Training needs were identified
through the departmental training needs analysis exercise and implemented according to the
Workplace Skills Plan submitted to the SETA. The focus for the period under review was on
management training which included project management, corporate governance, management of
absenteeism, supervisory skills and disciplinary management. Customer Care, Safety, Adults Basic
Education and HIV Aids awareness continues to feature high on the list of priorities for the company.
Other training initiatives were aimed at improving technical skills such as horticulture, computer
training, Environmental and waste Management systems, artisans, administrative and communication
skills.

Twelve women were identified for Mentorship Programme and were exposed to the following training
interventions, Business English, Time Management, Business Presentation Skills. They were also
exposed to on-the-job training at the level higher than their current levels, under experienced mentors.

JCP complied with the requirements of Skills Development Act and as such received Mandatory Levy
Grants in terms of the Act. In addition to the Mandatory grant received JCP also received
Discretionary grants for Apprenticeship, Internship and Learnership Programmes.

Through our Environmental and Conservation Development Unit, JCP partnered with the Department
of Environmental Affairs and Tourism (DEA&T) by serving as a host employer and offered practical
aspect of DEA&T Learnership Programme in Environmental Education, Training and Development
Practices to DEA&T 28 learners. The duration of the Learnership Programme was 12 months.

The financial investment in employee training and development over the last three years is as follows:

Financial investment in employees 2007/08 2006/07 2005/06

R’ 000 R’ 000 R’ 000
TOTAL 9 40 548 3 006 2 876

68
Section 4: Performance Management

This system is in place for level 1 to 5 appointees and other strategic positions. It was introduced to
motive, improve organizational performance and reward employees who consistently meet and
exceed corporate goals and objectives. Johannesburg City Parks performance management model is
based on the balanced scorecard and is in line with CoJ model/ policy. The balanced score card is
aimed at ensuring that the organization is aligned and focuses on critical performance measures that
enhance individual and organizational performance. The strategic review of the JCP business
includes an annual review of the imperatives that drive JCP. These include but not limited to the JCP
business plan, the environment in which JCP operates the CoJ Integrated Development Plan (IDP)

Development of Scorecard

Based on the processes here outlined, strategic performance objectives are set for each perspective
of the balanced score card and are weighted. Key Performance Area (KPA) support each strategic
performance objective are identified and Key Performance Indicator (KPI) for each KPA as well as
means to verify are identified and articulated. This process is cascaded from the MD to the Executive
in charge of each department who further cascades this to the relevant direct reports. This is to
ensure proper alignment from the MD to individual levels.

An appropriate incentive scheme is currently being explored for those employees who fall outside the
levels indicated above. The focus will again be on improving service delivery and meeting
stakeholder requirements and needs. There is quarterly review template as well as the performance
management deviation memorandum; this forms the basis of managing performance to ensure
continuous improvement and furthermore enhances the personal development areas of the
individuals which is service delivery based. The latter templates also ensures that there is
accountability and commitment attached to the individual on areas where deviation is sought due to
non-achievement of the set goals based on the timeframes.

69
Section 5: HIV AND AIDS MANAGEMENT

Johannesburg City Parks has an HIV and AIDS Policy approved by the Board. The policy is
strategically implemented to ensure compliance to the legislation. In the implementation of the policy
matters that are kept closely in mind mentioned in the policy are:
 Comprehensive health care
 Confidentiality and disclosures
 Non discrimination
 Education and awareness

Comprehensive Health Care

Employees are assisted to know their HIV status through accessing voluntary counselling and testing
(VCT). Johannesburg City Parks has embarked on the VCT campaigns since 2006/2006 financial
years. The 2007/2008 VCT Campaign took place from 15 May to 18 July 2008. There was a marked
decline in the 2007/8 financial year as compared to 2005/6 financial. This may be attributed by the
fact that most employees know their status and are on treatment. The figures below give the
comparative analysis by financial years as follows:

GRAND TOTALS VCT 2005/6

1. Number of Employees accessed VCT 1132

2. Positive 149
3. Negative 980

GRAND TOTALS VCT 2006/7

1. Number of Employees accessed VCT 830
2. Positive 79
3. Negative 751

GRAND TOTALS VCT 2007/8

1. Number of Employees accessed VCT 716
2. Positive 43
3. Negative 667

70
Confidentiality and Disclosures

Employees have come forward to disclose their status gradually mostly after VCT Campaigns, the
number have risen to 60. Most of these ones are on treatment through Right to Care and through
Faranani Disease Management. Others disclose their HIV status after diagnosed with incurable
“Multiple / Extreme Drug Resistant TB” those ones are under ongoing treatment and the one’s
diagnosed with XDR opt to take medical boarding since the recuperation is slow.

Education and Awareness

Education and awareness is ongoing at Johannesburg City Parks, this education take place on Health
and Wellness days, the recent Wellness Day was held on the 24 July 2008. The level of awareness
can only be measured and or tested against the participation levels of the employees as that
demonstrate a level of maturity to deal with the disease management.
World AIDS Days are also used to educate employees broadly about lifestyle and coping with HIV,
the Company thus dedicate times for commemoration as means of entrenching positive HIV and
AIDS messages.

Peer Educators are actively involved in day to day conscientisation of their peers at depots regarding
the spread of HIV and AIDS and prevention thereof. They are receiving ongoing training on HIV and
other related diseases, treatment programmes and prevention programmes.

Right to Care, Faranani Doctors and the Company Doctor are involved in reducing the impact of HIV
in the workplace by suggesting treatment and disease management programmes.

Through Employee Assistance Programmes and counselling employees are helped to stay productive
for longer and are advised regarding lifestyle management and healthy living.

Programmes such as retirement and substance abuse are used to mainstream HIV education to help
employees who are affected and infected to cope with the disease if its affecting them or significant
others.

Currently the Company is sourcing primary health care services that will be onsite to manage
Tuberculosis effectively and to reduce absenteeism and sick leave. The objective is to ensure that
employees are kept productive and effective for longer by ensuring that they access TB treatment
onsite regularly to the point of recuperation.

71
Incapacity Management

Managers are trained in incapacity management. This process is meant to help managers identify
incapacity problems timeously. Employees found to be incapacitated are confronted by their
managers through processes of counselling letters and explanation of Company procedures.

This then helps incapacitated employees to evaluate themselves in terms of their inputs to the
Company most of them would then acknowledge their problem and may seek to be relieved of their
duties through medical boarding and other means.

The programme is assisting Johannesburg City Parks reduce absenteeism and thus remain effective
as an organisation

Future Plans

Health and Wellness days to be conducted by zones in 2008/9 financial year, to ensure that all
employees access all available health screening services, namely, hypertension, diabetes, HIV and
AIDS, cholesterol, and BMI tests etc. That would reduce the stigma of HIV if all employees know their
health status, also would encourage balanced healthy lifestyles.

72
Section 6: Employee Benefits

JCP currently operates six pension funds and five medical aid schemes for employees. Employees
on cost to company packages exercise their choices in medical aid membership and retirement
funding.

PENSION FUNDS MEDICAL AID

Municipal Employee Pension Fund (60) Bonitas (232)
Municipal Gratuity Pension Fund (252) Keyhealth (ex Munimed) (70)
City of Johannesburg Pension Fund (550) L A Health (28)
Johannesburg Municipal Pension Fund (53) SAMWUMed (34)
eJoburg (769) Hosmed (1)
Joint Municipal Pension Fund (13) Day One Health (1302)

The Day One Health insurance scheme was introduced for all employees without medical aid. This
scheme provides basic benefits, and most importantly, HIV cover with full hospitalisation benefits.
The subscription cost is borne by the company and covers the principal member only. Employees
can enrol family members at a small additional cost which is for their own account.

73
Section 7: Supply Chain Management and Black Economic Empowerment

The Procurement Policy for the Company was approved and implemented in 2004. Its pillars are the
various pieces of legislation, such as the Preferential Procurement Policy Framework Act of 2000, the
Preferential Procurement Regulations of 2001, the Broad-Based Black Economic Empowerment Act
of 2003 and the accompanying Strategy and Draft Codes of Practice, and the Municipal Finance and
Management Act (MFMA). A Board Supply Chain Management Framework has been approved by the
Executive Committee which incorporates the provisions of Section 111 of the MFMA, the National
Treasury: Municipal Supply Chain Management Regulations of 2005, and the Construction Industry
Development Act.

The Company has set a target of 75% BEE procurement for the financial year. The target has been
divided into various sections:

Woman owned-companies (+25% woman shareholding) = 25%

BEE (+50% black shareholding) = 50%
Joint Venture (50%+ black shareholding) = 3%
78%
The Company has actively focused on the level of woman-owned companies and, this resulted in
expenditure in woman-owned companies of 30%.

With the company’s focus on planting of trees, watering services created an opportunity for women to
get involved in the operation aspects of a business. The company continued to leverage off the
foundation of women-owned companies created in previous years.

The following table is a summary of the BEE spend for the year.

Item BEE Traditional Total BEE %

Description R’000 R’000 BEE
R’000
Opex 178 711 21 358 200 069 89
Committed
Expenditure
Capex 60 332 12 274 72 606 83
Committed
Expenditure
Total 239 043 33 632 272 675 87

74
CHAPTER FIVE: AUDITED STATEMENTS AND RELATED FINANCIAL
INFORMATION

JOHANNESBURG CITY PARKS

Association Incorporated under Section 21
(Registration Number 2000/028782/08)

ANNUAL FINANCIAL STATEMENTS

For the year ended 30 June 2008

75
76
77
78
79
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

ANNUAL FINANCIAL STATEMENTS

For the year ended 30 June 2008

The reports and statements set out below comprise the Annual Financial Statements presented to the
member:

Index Page

General Information 81
Directors’ Responsibilities and Approval of Statement 83
Directors’ Report 85
Report of the Company Secretary 87
Statement of Financial Position 88
Statement of Financial Performance 89
Statement of Changes in Net Assets 90
Cash Flow Statement 91
Notes to the Annual Financial Statements 92
Detailed Statement of Financial Performance 140

80
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

GENERAL INFORMATION
For the year ended 30 June 2008

Country of Incorporation

Republic of South Africa

Nature of Business

The Company is a municipal entity and has been appointed as the greening, conservation and
cemetery management agency for the City of Johannesburg Metropolitan Municipality. The Company’s
mandate is to provide and manage parks, open spaces, environmental conservation services and
cemeteries. The Company operates solely within the municipal boundaries of the City of Johannesburg
Metropolitan Municipality, South Africa. The following is included in the scope of operation within the
City of Johannesburg Metropolitan area:

Number of parks and arterials: 2 328

Area of developed parks and arterials: 6 588 hectares
Area of undeveloped parks: 3 577 hectares
Nature reserves: 1 569 hectares
Street verges: 5 500 hectares
Area of cemeteries: 904 hectares
Water surfaces: 174 hectares
Street trees: 1,3 to 1,6 million
Cemeteries: 35
Crematoria: 2
Nurseries: 2
Bird sanctuaries: 24,6 hectares
Trails and river trails: 107 kilometres
Environmental and educational centres: 6
Size of fleet: vehicles 321
trailers 136
Number of employees: 1 799

Directors

The following directors held office during the year under review:

G. Zabala* - Chairperson
L.L. Williamson – Managing Director
B. Bahula*
A. Carolissen*
H. Kasan*
N. Mabaso*
S.M.B. Nyalunga*
T.B. Nzimakwe*
V. Ramsingh*
K. Venier*
*Non-executive

81
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

GENERAL INFORMATION
For the year ended 30 June 2008

Registered Office and Business Address

40 De Korte Street
Braamfontein
2017

Postal Address

P.O. Box 2824

Johannesburg
2000

Parent Municipality (Sole Member)

City of Johannesburg Metropolitan Municipality

Bankers

ABSA Limited

Auditors

The Auditor-General

Company Secretary

M Sayed Hassan

Attorneys

Sim and Botsi Attorneys

Company Registration Number

2000/028782/08

82
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

DIRECTORS’ RESPONSIBILITIES AND APPROVAL STATEMENT

For the year ended 30 June 2008

The Directors are required by the Municipal Finance Management Act No. 56 of 2003 and the South
African Companies Act No. 61 of 1973, to maintain adequate accounting records and are responsible
for the content and integrity of the financial statements and the related financial information included in
this report. It is their responsibility to ensure that the annual financial statements fairly present the state
of affairs of the company as at the end of the financial year and the results of its operations and cash
flows for the period then ended, in conformity with South African Statements of Generally Accepted
Accounting Practice (SA GAAP) and the prescribed Standards of Generally Recognised Accounting
Standards (GRAP). The external auditors are engaged to express an independent opinion on the
annual financial statements.

The annual financial statements have been prepared in accordance with South African Statements of
Generally Accepted Accounting Practice (SA GAAP) including any interpretations of such Statements
issued by the Accounting Practises Board, the Municipal Finance Management Act No. 56 of 2003 and
the Companies Act No. 61 of 1973, with the prescribed Standards of Generally Recognised Accounting
Practises (GRAP) issued by the Accounting Standards Board replacing the equivalent SA GAAP
Statement as follows:

Standard of GRAP Replaced Statement of SA GAAP

GRAP 1: Presentation of Financial Statements IAS 1: Presentation of Financial Statements

GRAP 2: Cash Flow Statements IAS 7: Cash Flow Statements

GRAP 3: Accounting policies, changes in IAS 8: Accounting policies, changes in accounting

Accounting estimates and errors estimates and errors

The Directors are of the opinion that the company is in material compliance with all aspects of the
Municipal Finance Management Act.

The Directors acknowledge that they are ultimately responsible for the system of internal financial
control established by the company and places considerable importance on maintaining a strong control
environment. To enable the Directors to meet their responsibilities, the Board of Directors sets
standards for internal control aimed at reducing the risk of error or loss in a cost effective manner. The
standards include the proper delegation of responsibilities within a clearly defined framework, effective
accounting procedures and adequate segregation of duties to ensure an acceptable level of risk. These
controls are monitored throughout the company and all employees are required to maintain the highest
ethical standards in ensuring the company’s business is conducted in a manner that in all reasonable
circumstances is above reproach. The focus of risk management in the company is on identifying,
assessing, managing and monitoring all known forms of risk across the company. While operating risk
cannot be fully eliminated, the company endeavours to minimise it by ensuring that appropriate
infrastructure, controls, systems and ethical behaviour are applied and managed within predetermined
procedures and constraints. The internal auditors independently evaluate the internal controls and
implementation of policies.

The Directors are of the opinion, based on the information and explanation given by management that
the system of internal control provides reasonable assurance that the financial reports may be relied on
for the preparation of the financial statements. However, any system of internal control can provide only
reasonable, and not absolute, assurance against material misstatement or loss.

83
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

DIRECTORS’ RESPONSIBILITIES AND APPROVAL STATEMENT (continued)

For the year ended 30 June 2008

The Directors have reviewed the Company’s cash flow statement for the year to 30 June 2008 and, in
the light of this review and the current financial position, they are satisfied that the Company has
access to adequate resources to continue in operational existence for the foreseeable future. The
Company is wholly dependent on the City of Johannesburg Metropolitan Municipality for continued
funding of operations. The financial statements are prepared on the basis that the Company is a going
concern and that the City of Johannesburg Metropolitan Municipality has neither the intention nor the
need to liquidate or curtail materially the scale of the Company’s operations. The budget for the financial
year ended 30 June 2008 has been approved by the Mayoral Committee of the City of Johannesburg
Metropolitan Municipality.

The Directors are primarily responsible for the financial affairs of the Company.

The external auditors are responsible for independently reviewing and reporting on the Company’s
financial statements.

The financial statements are set out on pages 88 to 141 which have been prepared on the going
th
concern basis, were approved by the Audit Committee of the Board on the 27 August 2008.

JOHANNESBURG
27 August 2008

84
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

DIRECTORS’ REPORT
For the year ended 30 June 2008

The Directors have pleasure in submitting the report for the year ended 30 June 2008.

Incorporation

The company was incorporated in the Republic of South Africa on 15 November 2000, and commenced
business on 1 January 2001.

Review of activities

The Company is a municipal entity and has been appointed as the greening, conservation and
cemetery management agency for the City of Johannesburg Metropolitan Municipality. The Company’s
mandate is to provide and manage parks, open spaces, environmental conservation services and
cemeteries. During the period under review, there were no changes to this mandate. The operating
results and state of affairs of the company are fully set out in the attached financial statements.

Property, plant and equipment

The Company acquired plant and equipment at a cost of R 11,5m (2007 – R 5,6m) during the financial
year under review. There was no change in the nature of the assets or in respect of the use thereof.
During the previous financial year, the company acquired a property to be utilised as its administrative
Head Office. The cost of the property was R 11,3m and refurbishment costs of R 12,7m have been
incurred to date. The property is located at 40 De Korte Street, Braamfontein. Further capital
expenditure of R 0,075 m has been committed at year end.

Going concern

The Company is wholly dependent on the City of Johannesburg Metropolitan Municipality for continued
funding of operations. The financial statements are prepared on the basis that the Company is a going
concern and that the City of Johannesburg Metropolitan Municipality has neither the intention nor the
need to liquidate or curtail materially the scale of the Company’s operations.

Subsequent events

The Directors are not aware of any matters or circumstances arising since the end of the financial year.

Directors

The following directors held office during the year and to the date of this report:

G. Zabala* - Chairperson
L.L. Williamson – Managing Director
B. Bahula*
A. Carolissen*
H. Kasan*
N Mabaso*
S.M.B. Nyalunga*
T.B. Nzimakwe*
V. Ramsingh*
K. Venier*
*Non-executive
All directors’ are of South African nationality

85
No directors had any interest in any contracts entered into by the Company during the year under
review.

JOHANNESBURG CITY PARKS

Association Incorporated under Section 21
Registration No. 2000/028782/08

DIRECTORS’ REPORT (continued)

For the year ended 30 June 2008

Parent municipality (sole member)

City of Johannesburg Metropolitan Municipality

Bankers

ABSA Limited
The management of the treasury function within the Company is managed under the auspices of the
City of Johannesburg Municipality Assets and Liabilities Committee and Treasury department.

Auditors

In accordance with Section 92 of the Municipal Finance Management Act No. 56 of 2003, the Auditor-
General will continue as the Company’s external auditor.

Company secretary

M Sayed Hassan

Registered office and business address

40 De Korte Street
Braamfontein
2017

Postal address

P.O. Box 2824

Johannesburg
2000

Company registration number

2000/028782/08

86
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

REPORT OF THE COMPANY SECRETARY

For the year ended 30 June 2008

CERTIFICATE BY COMPANY SECRETARY FOR THE YEAR ENDED 30 June 2008.

In terms of section 268G(d) of the South African Companies Act, No. 61 of 1973 as amended, I certify
that the Company has lodged with the Registrar all such returns as are required by the Companies Act
and that all such returns are true, correct and up to date.

M Sayed Hassan
Company Secretary

87
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

STATEMENT OF FINANCIAL POSITION

As at 30 June 2008

Restated
2008 2007

R’000 R’000
Notes
ASSETS

Current assets 239 348 240 610

Trade and other receivables 6 49 585 47 899

VAT 6 4 823 2 356
Cash and cash equivalents 7.2 32 21
Inventory 8 3 712 586
Loans to share-member 9 181 196 189 748

Non-current assets 116 288 104 291

Property, plant and equipment 3 43 870 25 641

Intangible Assets 4 3 843 4 640
Employee benefit investment 5 68 575 74 010

Total assets 355 636 344 901

LIABILITIES

Current liabilities 158 030 143 977

Trade and other payables 10 147 750 133 697

Short-term portion of finance lease liability 18.3 183 170
Provisions 11 10 097 10 110

Non-current liabilities 88 687 87 879

Employee benefit obligations 5 88 655 87 706

Long-term portion of finance lease liability 18.3 32 173

Total liabilities 246 717 231 856

Net Assets 108 919 113 045

NET ASSETS

Loans from share-member 9 28 098 28 098

Accumulated surplus 80 821 84 947

Total Net Assets 108 919 113 045

88
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

STATEMENT OF FINANCIAL PERFORMANCE

For the year ended 30 June 2008

Restated
2008 2007
R’000 R’000
Notes

Revenue – exchange 12 425 314 368 211

Cost of sales (34 113) (14 935)
_______ _______

Gross surplus 391 201 353 276

Other income 712 -
Operating expenses (415 446) (355 661)
_______ _______

Operating deficit 13 (23 533) (2 385)

Investment income 14 26 559 19 771
Finance costs 15 (7 152) (7 732)
_______ _______

(Deficit)/Surplus for the year (4 126) 9 654

89
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

STATEMENT OF CHANGES IN NET ASSETS

For the year ended 30 June 2008

Accumulated
Surplus
R’000
Note

Balance at 1 July, 2006 – restated 2 75 293

Surplus for the year ended 30 June 2007 - restated 2 9 654
______

Balance as at 1 July 2007 - restated 84 947

Deficit for the year ended 30 June 2008 (4 126)
______

Balance as at 30 June 2008 80 821

90
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

CASH FLOW STATEMENT

For the year ended 30 June 2008

Restated
2008 2007
R’000 R’000

Notes

Cash flows from operating activities

Cash receipts from customers 421 873 356 145

Cash paid to suppliers and employees (432 624) (364 774)
Cash utilised by operations 7.1 (10 751) (8 629)
Investment income 26 559 19 771
Finance costs (7 152) (7 686)

Net cash from operating activities 8 656 3 456

Cash flows from investing activities

Expenditure to maintain operating capacity (17 069) (17 348)

Property, plant and equipment acquired (22 898) (18 343)
Intangible assets acquired (642) (2 418)
Plant and equipment disposed 1 036 1 218
Intangible assets disposed - 193
Employee benefit investment 5 435 2 001

Cash flows from financing activities

8 424 13 892
Share-member loans 8 552 13 683
Finance lease liability (128) 209
_______ _______
Increase in cash and cash equivalents
11 -

Cash and cash equivalents at beginning

of the year 21 21
_______ _______
Cash and cash equivalents at the end
of the year 7.2 32 21

91
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS

For the year ended 30 June 2008

1. ACCOUNTING POLICIES AND GLOSSARY OF FINANCIAL TERMS

1. 1 PRINCIPAL ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of the annual financial statements of the company
are set out below:

1.1.1 Presentation of Financial Statements

The financial statements have been prepared in accordance with South African Statements of Generally
Accepted Accounting Practice including any interpretations of such Statements issued by the
Accounting Practices Board, the prescribed Standards of Generally Recognised Accounting Practices,
The Municipal Finance Management Act No. 56 of 2003 and The Companies Act No. 61 of 1973, with
the prescribed Standards of Generally Recognised Accounting Practices (GRAP) issued by the
Accounting Standards Board replacing the equivalent SA GAAP Statement as follows:

Standard of GRAP Replaced Statement of SA GAAP

GRAP1: Presentation of Financial
Statements
GRAP2: Cash Flow Statements
GRAP3: Accounting policies, changes in
accounting estimates and errors
IAS1: Presentation of Financial
Statements
IAS7: Cash Flow Statements
IAS8: Accounting policies, changes in
accounting estimates and errors

The recognition and measurement principles in the above GRAP and GAAP Statements do not differ or
result in material differences in items presented and disclosed in the financial statements. The
implementation of GRAP 1,2 & 3 has resulted in the following significant changes in the presentation of
the financial statements:

1. Terminology differences:
Standard of GRAP Replaced Statement of SA GAAP
Statement of financial performance Income Statement
Statement of financial position Balance Sheet
Statement of changes in net assets Statement of changes in equity
Net assets Equity
Surplus/deficit for the period Profit/loss for the period
Accumulated surplus/deficit Retained Earnings
Contributions from owners Share capital
Distribution to owners Dividends
Reporting date Balance sheet date

2. The cash flow statement can only be prepared in accordance with the direct method.
3. Specific information such as:
(a) receivables from non-exchange transactions, including taxes and transfers;
(b) taxes and transfers payables;
(c) trade and other payables from non-exchange transactions;
must be presented separately on the statement of financial position.
4. The amount and nature of any restrictions on cash balances is required to be disclosed.
5. Paragraph 11-15 of GRAP 1 has not been implemented as the budget reporting standard is in the
process of being developed by the international and local standard setters. Although the inclusion of
budget information would enhance the usefulness of the financial statements, non-disclosure will not
affect fair presentation.

92
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

1. ACCOUNTING POLICIES AND GLOSSARY OF FINANCIAL TERMS (continued)

1. 1 PRINCIPAL ACCOUNTING POLICIES (continued)

1.1.2 Underlying concepts

The financial statements are prepared on the going concern basis using accrual accounting.
Assets and liabilities, and income and expenses are not offset unless specifically permitted by an accounting
standard.
Financial assets and financial liabilities are offset and the net amount reported only when a legally
enforceable right to set off exists and the intention is either to settle on a net basis or to realise the asset and
settle the liability simultaneously.
Changes in accounting policies are accounted for in accordance with the transitional provisions in the
accounting standards and interpretations. If no such guidance is given, they are applied retrospectively
unless it is impracticable to do so, in which case they are applied prospectively.
Changes in accounting estimates are recognised in the Statement of Financial Performance.
1.1.3 Recognition of assets and liabilities

Assets are only recognised if they meet the definition of an asset, in that it is probable that future economic
benefits associated with the asset are within the control of the company, the economic benefits will flow to
the company and the cost or fair value can be measured reliably.
Liabilities are only recognised if they meet the definition of a liability, in that it is probable that future economic
benefits associated with the liability will flow from the company and the cost or fair value can be measured
reliably.
Financial instruments are recognised when the company becomes party to the contractual provisions of the
instrument.

1.1.4 Derecognition of assets and liabilities

Assets are derecognised on disposal or when no future benefits are expected from their use.

Liabilities are derecognised when the relevant obligation has been discharged or cancelled or expired.

1.1.5 Post Statement of Financial Position events

Where events arise after the Statement of Financial Position date that existed at that date, these are
recognised in the financial statements.

Where events arise after the Statement of Financial Position date that existed after that date, these are
recognised in the financial statements by way of a note.

1.1.6 Comparative figures

Comparative figures are restated in the event of change in accounting policy or prior year error where
practicable.

93
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

1. ACCOUNTING POLICIES AND GLOSSARY OF FINANCIAL TERMS (continued)

1. 1 PRINCIPAL ACCOUNTING POLICIES (continued)

1.1.7 Property, plant & equipment

Property, plant & equipment represent tangible assets that are held for use in the production or supply of
goods or services, for rental to others, or for administrative purposes. Such assets are expected to have a
useful life of more than one year.

The cost of an item of property, plant and equipment is recognised as an asset when:
o It is probable that future economic benefits associated with the item will flow to the company;
and
o The cost of the item can be reliably measured.

Costs include costs incurred initially to acquire or construct an item of property, plant and equipment and
costs incurred subsequently to add to, replace part of, or service it. If a replacement cost is recognised
in the carrying amount of an item of property, plant and equipment, the carrying amount of the replaced
part is derecognised.

The initial estimate of the costs of dismantling and removing the item and restoring the site on which it is
located is also included on the cost of property, plant and equipment.

Plant & equipment are stated at cost less accumulated depreciation and accumulated impairment
losses. Land and buildings are shown at fair value, based on periodic valuations by external
independent valuers, less subsequent depreciation for buildings. Any accumulated depreciation at the
date of revaluation is eliminated against the gross carrying amount of the asset, and the net amount is
restated to the revalued amount of the asset.

Increases in the carrying amount arising on revaluation of land and buildings are credited to other
reserves. Decreases that offset previous increases of the same asset are charged against other
reserves; all other decreases are charged to the statement of financial performance.

Land is not depreciated. Depreciation is charged on a straight-line basis over their estimated useful lives
to estimated residual values.

Where significant parts of an asset have different useful lives to the asset itself, these parts are
accounted for as separate assets and depreciated over their respective estimated useful life.

The useful life and residual values are reviewed on an annual basis.

Assets held under finance leases are depreciated over the lower of their expected useful lives or the
term of the lease.

Gains or losses on disposal or scrapping is recognised in the Statement of Financial Performance.

Subsequent costs, which can be reliably measured, are included in the assets carrying amount only
when it is probable that such expenditure increases the future economic benefits associated with the
asset by either increasing output capacity or the useful life of the asset. All other repairs and
maintenance are charged to the Statement of Financial Performance during the period in which they are
incurred.

94
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

1. ACCOUNTING POLICIES AND GLOSSARY OF FINANCIAL TERMS (continued)

1. 1 PRINCIPAL ACCOUNTING POLICIES (continued)

1.1.8 Intangible assets

An intangible asset is recognised when:

o It is probable that the expected future economic benefits that are attributable to the asset
will flow to the entity; and
o The cost of the asset can be measured reliably.

Intangible assets are initially recognised at cost.

Intangible assets are carried at cost less any accumulated amortisation and any impairment losses.

Amortisation is provided on a straight line basis over their estimated useful life.

The amortisation period and the amortisation method for intangible assets are reviewed every year-end.

1.1.9 Inventories

The cost of inventories is assigned using the weighed average formula. The same cost formula is used
for all inventories having a similar nature and use to the entity.

Technical stores comprise of items used in the day-to-day maintenance of park facilities and depot
buildings.

1.1.10 Financial instruments

Initial recognition
The company classifies financial instruments, or their component parts, on initial recognition as a
financial asset, a financial liability or an equity instrument in accordance with the substance of the
contractual arrangement.

Financial assets and financial liabilities are recognised on the company’s Statement of Financial
Position when the company becomes party to the contractual provision of the instrument.

1.1.10.1 Financial assets

A financial asset is an asset and is recognised as such when a contractual right to receive an economic
benefit exists and are derecognised when these rights or obligations no longer exist.

Financial assets are initially measured at fair value plus transaction costs.

Derivatives that are assets are measured at fair value, with changes in fair value being recognised in the
Statement of Financial Performance. Derivatives embedded in non-financial host contracts are treated as
separate derivatives when their risk and characteristics are not closely related to those of the host contract
and the host contract is not classified as at fair value through the Statement of Financial Performance.

95
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS

For the year ended 30 June 2008

1. ACCOUNTING POLICIES AND GLOSSARY OF FINANCIAL TERMS (continued)

1. 1 PRINCIPAL ACCOUNTING POLICIES (continued)

1.1.10 Financial instruments (continued)

1.1.10.2 Financial liabilities

A financial liability is a liability and is recognised as such when a contractual obligation exists to pay an
economic benefit and is derecognised when these rights or obligations no longer exist.
Financial liabilities are initially measured at fair value plus transaction costs.

Derivatives that are liabilities are measured at fair value, with changes in fair value being recognised in
the Statement of Financial Performance. Derivatives embedded in non-financial host contracts are
treated as separate derivatives when their risk and characteristics are not closely related to those of the
host contract and the host contract is not classified as at fair value through the Statement of Financial
Performance.
1.1.10.3 Trade and other receivables

Trade and other receivables are measured at initial recognition at fair value, and are subsequently
measured at amortised cost using the effective interest rate method. Appropriate allowances for
estimated irrecoverable amounts are recognised in surplus or deficit when there is objective evidence
that the asset is impaired. The allowance recognised is measured as the difference between the asset’s
carrying amount and the present value of estimated cash flows discounted at the effective interest rate
computed at initial recognition.

1.1.10.4 Trade and other payables

Trade and other payables are initially measured at fair value, and are subsequently measured at
amortised cost, using the effective interest rate method.

1.1.10.5 Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and demand deposits and other short-term highly
liquid investments that are readily convertible to a known amount of cash and are subject to an
insignificant risk of changes in value. These are initially and subsequently recorded at fair value.

1.1.11 Post-retirement employee benefit obligations

1.1.11.1 Pension Plans

The company participates in a number of defined benefit and defined contribution retirement plans
consisting primarily of active members (current employees of the company, the City of Johannesburg
Metropolitan Municipality and its subsidiaries) and pensioners.

Defined Benefit Plans: For defined benefit plans the cost of providing the benefits is determined using
the projected credit method.

Actuarial valuations are conducted on an annual basis by independent actuaries separately for each
plan.

96
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS

For the year ended 30 June 2008

1. ACCOUNTING POLICIES AND GLOSSARY OF FINANCIAL TERMS (continued)

1. 1 PRINCIPAL ACCOUNTING POLICIES (continued)

1.1.11 Post-retirement employee benefit obligations (continued)

1.1.11.1 Pension plans (continued)

Consideration is given to any event that could impact the funds up to Statement of Financial Position
date where the interim valuation is performed at an earlier date. Past service costs are recognised
immediately to the extent that the benefits are already vested, and are otherwise amortised on a straight
line basis over the average period until the amended benefits become vested.

To the extent that, at the beginning of the financial year, any cumulative unrecognised actuarial gain or
loss exceeds ten percent of the greater of the present value of the projected credit obligation and the fair
value of the plan assets (the corridor), that the portion is recognised in the Statement of Financial
Performance over the expected average remaining service lives of the participating employees.
Actuarial gains and losses within the corridor are not recognised.

Gains or losses on the curtailment or settlement of a defined benefit plan are recognised when the
company is demonstrably committed to curtailment or settlement.

The amount recognised in the Statement of Financial Position represents the present value of the
defined benefit obligation as adjusted for unrecognised actuarial gains and losses and unrecognised
past service costs, and reduces by the fair value of plan assets.

Any asset is limited to unrecognised actuarial losses, plus the present value of available refunds and
reduction in future contributions to the plan.

Defined Contribution Plans: Payments to defined contribution retirement benefit plans are charged as an
expense as they fall due.

Payments made to industry-managed (or state plans) retirement benefit schemes are dealt with as
defined contribution plans where the company’s obligation under the schemes is equivalent to those
arising in a defined contribution retirement benefit plan.

1.1.11.2 Other

Post-Retirement Medical Aid: The Company provides post-retirement health care benefits for certain
retirees. The entitlement is based on the employee remaining in the service of the company until
retirement age and the completion of a minimum of 15 years of service. The expected cost of these
benefits is accrued over the period of employment, using the present value methodology. Independent
qualified actuaries carry out valuations of these obligations. Valuations for company accounting
purposes are carried out annually. Actuarial gains and losses are recognised immediately in the profit
and loss.

Post-Retirement Housing: The Company provides housing subsidies in respect of certain retirees. The
subsidy may continue to a maximum of 10 years after retirement. The expected cost of these benefits is
accrued over the period of employment, using the present value methodology. Independent qualified
actuaries carry out valuations of these obligations. Valuations for company accounting purposes are
carried out annually. Actuarial gains and losses are recognised immediately in the profit and loss.

97
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS

For the year ended 30 June 2008

1. ACCOUNTING POLICIES AND GLOSSARY OF FINANCIAL TERMS (continued)

1. 1 PRINCIPAL ACCOUNTING POLICIES (continued)

1.1.11 Post-retirement employee benefit obligations (continued)

1.1.11.2 Other (continued)

Gratuities: The Company provides gratuities on retirement or prior death (i.e. for those members that
have died prior to retirement date) in respect of certain qualifying employees who have service with the
City of Johannesburg Metropolitan Municipality or the Company when they were not members of one of
the retirement benefit plans. The expected cost of these benefits is accrued over the period of
employment, using the present value methodology. Independent qualified actuaries carry out valuations
of these obligations. Valuations for company accounting purposes are carried out annually. Actuarial
gains and losses are recognised immediately in the profit and loss.

1.1.12 Provisions

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of
past events, and it is probable that an outflow of resources embodying economic benefits will be required to
settle the obligation, and a reliable estimate of the amount of the obligation can be made.

The amount of the provision is the present value of the expenditure expected to be required to settle the
obligation.

When some or all of the expenditure required to settle a provision is expected to be reimbursed by
another party, the reimbursement shall be recognised when, and only when, it is virtually certain that
reimbursement will be received if the entity settles the obligation. The reimbursement shall be treated as
a separate asset. The amount recognised for the reimbursement shall not exceed the amount of the
provision.

Provisions are not expected for future operating deficits.

If an entity has a contract that is onerous, the present obligation under the contract shall be recognised
and measured as a provision.

A constructive obligation to restructure arises only when an entity:

o Has a detailed formal plan for the restructuring, identifying at least:
 The business or part of a business concerned;
 The principal locations affected;
 The location, function, and approximate number of employees who will be
compensated for terminating their services;
 The expenditures that will be undertaken; and
 When the plan will be implemented; and
o Has raised a valid expectation in those affected that it will carry out the restructuring by starting
to implement that plan or announcing its main features to those affected by it.

Contingent assets and liabilities are not recognised. Disclosure is provided explaining the contingencies.

98
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS

For the year ended 30 June 2008

1. ACCOUNTING POLICIES AND GLOSSARY OF FINANCIAL TERMS (continued)

1. 1 PRINCIPAL ACCOUNTING POLICIES (continued)

1.1.13 Revenue

Revenue from the sale of goods is recognised when all the following conditions have been satisfied:
o the company has transferred to the buyer the significant risks and rewards of ownership of the
goods;
o the company retains neither continuing managerial involvement to the degree usually
associated with ownership nor effective control over the goods sold;
o the amount of revenue can be measured reliably;
o it is probable that the economic benefits associated with the transaction will flow to the
company; and
o the costs incurred or to be incurred in respect of the transaction can be measured reliably.

99
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS

For the year ended 30 June 2008

1. ACCOUNTING POLICIES AND GLOSSARY OF FINANCIAL TERMS (continued)

1. 1 PRINCIPAL ACCOUNTING POLICIES (continued)

1.1.13 Revenue (continued)

When the outcome of a transaction involving the rendering of services can be estimated reliably,
revenue associated with the transaction is recognised by reference to the stage of completion of the
transaction at the Statement of Financial Position date. The outcome of the transaction can be
estimated reliably when all of the following conditions are satisfied:
o the amount of revenue can be measured reliably;
o it is probable that the economic benefits associated with the transaction will flow to the
company;
o the stage of completion of the transaction at the Statement of Financial Position date can be
measured reliably; and
o the costs incurred for the transaction and the costs to complete the transaction can be
measured reliably.

When the outcome of the transaction involving the rendering of services cannot be estimated reliably,
revenue shall be recognised to the extent of the expenses recognised that are recoverable.

Stage of completion is determined by surveys of work performed or services performed to date as a

percentage of total services to be performed or the proportion of costs incurred to date bear to the total
estimated costs of the transaction.

Revenue is measured at the fair value of the consideration received or receivable and represents the
amounts receivable for goods and services provided in the normal course of business.

1.1.14 Cost of sales

When inventories are sold, the carrying amount of those inventories is recognised as an expense in the
period in which related revenue is recognised. The amount of any write-down of inventories to net
realisable value and all losses of inventories are recognised as an expense in the period the write-down
or loss occurs. The amount of any reversal of any write-down of inventories, arising from an increase in
net realisable value, is recognised as a reduction in the amount of inventories recognised as an expense
in the period in which the reversal occurs.

The related cost of providing services recognised as revenue in the current period is included in cost of
sales.

Contract costs comprise:

o Costs that relate directly to a specific contract.
o Costs that are attributable to contract activity in general and can be allocated to the contract;
and
o Such other costs as are specifically chargeable to the customer under the terms of the contract.

1.1.15 Impairment of assets

Assets that are depreciated are reviewed annually for impairment whenever events or changes in
circumstances indicate that the carrying amount of such asset exceeds the asset’s fair value less cost to
sell or its value in use.

100
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS

For the year ended 30 June 2008

1. ACCOUNTING POLICIES AND GLOSSARY OF FINANCIAL TERMS (continued)

1. 1 PRINCIPAL ACCOUNTING POLICIES (continued)

1.1.15 Impairment of assets (continued)

The company assesses at each Statement of Financial Position date whether there is any indication that
an asset may be impaired. If any such indication exists, the company estimates the recoverable amount
of the asset.

If there is any indication that an asset may be impaired, the recoverable amount is determined for the
individual asset. If it is not possible to estimate the recoverable amount of the individual asset, the
recoverable amount of the cash-generating unit to which the asset belongs is determined.

The recoverable amount of an asset or cash-generating unit is the higher of its fair value less costs to
sell and its value in use.

If the recoverable amount is less than the carrying amount, the carrying amount of the asset is reduced
to the recoverable amount. That reduction is an impairment loss.

In assessing value in use, the estimated future cash flows are discounted to their present value using a
pre-tax discount rate that reflects current market assessments of the time value of money and the risks
specific to the asset.

An impairment loss of assets carried at cost less any accumulated depreciation or amortisation is
recognised immediately in surplus or deficit. Any impairment loss of a revalued asset is treated as a
revaluation decrease.

A reversal of an impairment loss of assets carried at cost less accumulated depreciation or amortisation
other than goodwill is recognised immediately in surplus or deficit. Any reversal of an impairment loss of
a revalued asset is treated as a revaluation increase.

1.1.16 Leases

Financial leases: Leases where the company assumes substantially all the benefits and risks of
ownership are classified as finance leases. Finance leases are capitalised under property, plant &
equipment at the lower of fair value or the present value of the minimum lease payments at the inception
of the lease with an equivalent amount being stated as a finance lease liability.

The capitalised amount is depreciated over the useful life of the asset. Lease payments are allocated
between capital repayments and borrowing costs using the effective interest rate method.

Finance charges are charged to surplus or deficit, unless they are directly attributable to qualifying
assets, in which case they are capitalised in accordance with the company’s general policy on borrowing
costs.

The discount rate used in calculating the present value of the minimum lease payments is the interest
rate implicit in the lease or the incremental borrowing rate.

Operating leases: Operating lease payments are recognised as an expense on a straight-line basis over
the lease term. The difference between the amounts recognised as an expense and the contractual
payments are recognised as an operating lease asset or liability. This liability is not discounted. Any
contingent rents are expensed in the period they are incurred.

101
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS

For the year ended 30 June 2008

1. ACCOUNTING POLICIES AND GLOSSARY OF FINANCIAL TERMS (continued)

1. 1 PRINCIPAL ACCOUNTING POLICIES (continued)

1.1.17 Government grants and assistance

Government grants are recognised when there is reasonable assurance that:

o The company will comply with the conditions attaching to them; and
o The grants will be received

Government grants related to assets: Such are government grants whose primary condition is that the
company should purchase, construct or otherwise acquire long-term assets. Other conditions may also
be attached restricting the type or location of the assets or the periods during which they are to be
acquired or held. On completion of the conditions, the company transfers the assets to the City of
Johannesburg Metropolitan Municipality.

Government grants related to assets, including non-monetary grants at fair value are presented in the
Statement of Financial Position by deducting the grant in arriving at the carrying amount of the asset.

The above-mentioned grants are not recognised as income in the company’s Statement of Financial
Performance.

Government grants related to income: Such grants are recognised as income over the periods
necessary to match them with the related costs that they are intended to compensate.

1.1.18 Judgements made by management

In preparing the financial statements, management is required to make estimates and assumptions that
affect the amounts represented in the financial statements and related disclosure. Use of the available
information and the application of judgement are inherent in the formation of estimates. Actual results in
the future could differ from these estimates which may be material to the financial statements.

The following subjective judgements or assessments have been identified:

Assets useful life and residual values: Property, plant and equipment is depreciated over its entire useful
life taking into account residual values, if applicable. The useful life and residual values are assessed
annually and are dependent on numerous factors such as advances in technology, life cycle of the
assets, repairs and maintenance, future market conditions, the remaining life of the asset and projected
disposal values.

102
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS

For the year ended 30 June 2008

1. ACCOUNTING POLICIES AND GLOSSARY OF FINANCIAL TERMS (continued)

1. 1 PRINCIPAL ACCOUNTING POLICIES (continued)

1.1.18 Judgements made by management (continued)

The following estimated useful lives are used to depreciate property, plant & equipment to estimated
residual values:

Property 20 years
Plant & equipment:
-Small plant (brushcutters, chainsaws, small lawnmowers, etc.) 2 – 3 years
-Medium plant (slashers, ride-on lawnmowers, chippers, etc) 5 – 7 years
Office equipment 5 – 10 years
Computer equipment 3 – 5 years
Spares for maintenance of plant and equipment 0 years
Leasehold improvements The lower of the
balance of lease or 5 years
The following estimated useful lives are used to amortise intangible assets to estimated residual values:

Application software 3 – 5 years

Impairment: Property, plant and equipment, and intangible assets are considered for impairment if there
is reason to believe that an impairment may be necessary. Factors such as the economic viability of the
asset are considered.

Post-retirement benefit plan obligations: These are provided for certain existing and former employees.
Actuarial valuations are based on assumptions, that are largely prescribed, which include employee
turnover, mortality rates, the interest rates (based on the yield to redemption of appropriate government
or corporate securities, the terms of which are reasonable in relation to those of the pension funds), the
discount rate, the expected long-term rate of return of retirement plan assets, healthcare inflation costs
and rates of increase in compensation costs. Actuarial gains and losses comprise experience
adjustments (the effects of differences between the previous actuarial assumptions and what has
actually occurred), and the effect of changes in actuarial assumptions. These may be spread forward
over the remaining service years of the employees

1.1.19 Financial risk management

Liquidity risk
The company’s risk to liquidity is a result of the funds available to cover future commitments. The
company manages liquidity risk through an ongoing review of future commitments and credit facilities.

Interest rate risk

Deposits attract interest at a rate that varies with prime. The parent treasury policy is to manage interest
rate risk so that fluctuations in variable rates do not have a material impact on surplus or deficit.

103
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS

For the year ended 30 June 2008

1. ACCOUNTING POLICIES AND GLOSSARY OF FINANCIAL TERMS (continued)

1. 1 PRINCIPAL ACCOUNTING POLICIES (continued)

1.1.20 Financial risk management (continued)

Credit risk

Credit risk consists mainly of cash deposits, cash equivalents and capital debtors. All cash deposits are
managed by the parent treasury department.

1.1.21 Borrowing costs

Borrowing costs are recognised as an expense in the period in which they are incurred.

Borrowing costs that are directly attributable to the acquisition, construction or production of qualifying
asset are capitalised as part of the cost of that asset until such time as the asset is ready for its intended
use.

The amount of borrowing costs eligible for capitalisation is determined as follows:

 Actual borrowing costs on funds specifically borrowed for the purpose of obtaining a qualifying
asset less any temporary investment of these borrowings.
 Weighted average of the borrowing costs applicable to the entity on funds generally borrowed
for the purpose of obtaining a qualifying asset. The borrowing costs capitalised do not exceed
the total borrowing costs incurred.

Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets,
which are assets that necessarily take a substantial period of time to get ready for their intended use or
sale, are added to the cost of those assets, until such time as the assets are substantially ready for their
intended use or sale. Investment income earned on the temporary investment of specific borrowings
pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for
capitalisation.

The capitalisation of borrowing costs commences when:

 Expenditures for the asset have occurred;
 Borrowing costs have been incurred, and
 Activities that are necessary to prepare the asset for its intended use or sale are in progress.

Capitalisation is suspended during extended periods in which active development is interrupted.

Capitalisation ceases when substantially all the activities necessary to prepare the qualifying asset for
its intended use or sale are complete.

All other borrowing costs are recognised as an expense in the period in which they are incurred.

104
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

1. ACCOUNTING POLICIES AND GLOSSARY OF FINANCIAL TERMS (continued)

1. 1 PRINCIPAL ACCOUNTING POLICIES (continued)

1.1.22 Unauthorised, irregular, fruitless and wasteful expenditure

All expenditure relating to unauthorised, irregular or fruitless and wasteful expenditure is recognised as
an expense in the statement of financial performance in the year that the expenditure was incurred. The
expenditure is classified in accordance with the nature of the expense, and where recovered, it is
subsequently accounted for as revenue in the statement of financial performance.

1.2 GLOSSARY OF FINANCIAL REPORTING TERMS

The glossary of financial reporting terms is provided to ensure clarity of meaning as certain terms may
not always have the same meaning or interpretation.

Accrual accounting The effects of transactions and other events are recognised when they occur
rather than when the cash is received.

Actuarial gains and The effects of differences between the previous actuarial
losses assumptions and what has actually occurred as well as changes in actuarial
assumptions.

Asset A resource in control of the company as a result of a past event from which
future economic benefits are expected to flow.

Carrying amount The amount at which an asset is recognised after deducting any accumulated
depreciation and accumulated impairment losses.

Cash and cash Comprise cash on hand and balances with banks and other financial
equivalents institutions.

Change in accounting An adjustment to the carrying amount of an asset, liability or the

estimate amount of the periodic consumption of an asset that results from new
information or new developments.

Constructive An obligation that derives from an established pattern of past

obligation practice, published policies or a sufficiently specific current statement such that
it creates a valid expectation on the part of other parties that the obligation will
be met.

Contingent liability A possible obligation that arises from past events and whose existence will be
confirmed only by the occurrence or non-occurrence of one or more uncertain
future events not wholly within the control of the company, or a present
obligation that arises from past events but is recognised because it is not
probable that an outflow of resources embodying economic benefits will be
required to settle the obligation or the amount of the obligation cannot be
measured with sufficient reliability.

Depreciation The systematic allocation of the depreciable amount of an asset over its useful
life. The depreciable amount of an asset is the cost of an asset, or other amount
substituted for cost, less its residual value.

105
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2006

1. ACCOUNTING POLICIES AND GLOSSARY OF FINANCIAL TERMS (continued)

1. 2 GLOSSARY OF FINANCIAL REPORTING TERMS (continued)

Derecognition The removal of a previously recognised asset or liability from the Statement of
Financial Position.

Derivative instrument A financial instrument

- whose value changes in response to movements in interest rates or similar
variable; and
- whose terms require or permit net settlement at a future date.

Discount rate The rate used for purpose of determining discounted cash flows defined as the
yield at which the company receives on its sweepings bank account from the
City of Johannesburg Metropolitan Municipality Treasury. Risks specific to the
relevant asset or liability are not factored in determining the discount rate.

Employee benefits All forms of consideration given in exchange for services rendered by
employees.

Fair value The value for which an asset could be exchanged or a liability settled in a
market related transaction.

Financial lease A lease that transfers substantially all the risks and rewards incidental to
ownership of an asset. Title may or may not eventually be transferred.

Financial instrument A contract that gives rise to a financial asset of one company and a financial
liability or equity instrument of another company.

Financial results These comprise the financial position (assets, liabilities and equity), results of
operations (revenue and expenses) and cash flows of the Company.

Going concern The assumption that the company will continue in operation for at
basis least twelve months from the Statement of Financial Position date.

Immaterial An amount which, if individually or collectively, would not influence the

economic decisions of the readers of the financial statements.

Impairment loss The amount by which the carrying amount of an asset or a cash-generating unit
exceeds its recoverable amount.

Liability A present obligation of the company arising from a past event, the settlement of
which is expected to result in the outflow of resources embodying economic
benefits.

Long-term A period longer than twelve months from Statement of Financial Position date.

Net assets Net operating assets plus cash and cash equivalents.

Net operating assets Current and non-current assets less current and non-current liabilities.

Operating lease A lease other than a financial lease.

106
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2006

1. ACCOUNTING POLICIES AND GLOSSARY OF FINANCIAL TERMS (continued)

1. 2 GLOSSARY OF FINANCIAL REPORTING TERMS (continued)

Post – Retirement Employee benefits (other than termination benefits) that are payable
benefits after the completion of employment.

Post – Retirement Formal arrangements under which the company provides post-retirement
benefit plans benefits to employees. Defined contribution benefit plans are where there are
no legal or constructive obligations to pay further contributions if the fund does
not hold sufficient assets to pay all employee benefits relating to employee
service in the current and prior periods. Defined benefit plans are post-
retirement benefit plans other than defined contribution plans.

Prior period errors An omission from or misstatement in the financial statements for one or more
prior periods arising from a failure to use, or misuse of, reliable information that
was available when the financial statements for those periods were approved
and one could have reasonably expected to have been obtained and taken into
account in the preparation of those financial statements.

Recoverable amount The amount that reflects the greater of the net selling price and value in use
that can be attributed to an asset as a result of its ongoing use by the
Company. In determining the value in use, expected cash flows are discounted
to their present values using the discount rate.

Related party 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.

Residual value The estimated amount which the company would currently receive on disposal
of the asset, after deducting the estimated costs of disposal, if the asset were
already of the age and in the condition expected at the end of its useful life.

Retrospective Applying a new accounting policy to transactions, other events and

application conditions as if that policy had always been applied.

Retrospective Correcting the recognition, measurement and disclosure of amounts

restatement if a prior period error had never occurred.

Revenue Revenue comprises turnover and interest received.

Turnover Turnover comprises revenue generated by the operating activities and includes
sale of gravesites, crematoria services, hire of park facilities, sale of trees,
services rendered and municipal subsidy.

Useful life The period over which an asset is expected to be available for use from which
future economic benefits are expected to flow.

107
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

2. PRIOR PERIOD ERRORS AND RESTATEMENTS

The statements have been prepared as noted above in note 1.

During the 2004 financial year, un-reconciled items within salaries and wages totaling R 410 775 were ring-
fenced for a prescriptive period of three years. No claims were made against these funds and were thus
written back to the opening retained income as at 1 July 2006.

An adjustment in the timing of withdrawals during the previous financial year from the Gratuity Notional
account held was made during the current financial year. The impact on the retained earnings for the year
ended 30 June 2007 was an increase in investment income of R 172 098.

During the previous financial year, the company re-registered for VAT in terms of the Small Business Tax
Amnesty and Amendment of Taxation Laws Act, 2006 (Act No. 9 of 2006). During the implementation of the
above, an error in the calculation of the investment by the share-member occurred. The adjustment of R 141
519 did not impact the retained earnings.

The following reconciliation highlights the restatement of prior year errors:

Reconciliation of net assets

30 June
2007
R’000

Net Assets previously reported under SA GAAP 84 364

Adjustment for prior period errors and restatements 583

Net Assets reported 84 947

Net Asset Adjustment

Retained Earnings:
- Salaries and allowances 411
- Investment Income 172
583

Assets and Liabilities Adjustment

Trade and other receivables 30

Trade and other payables 411
Loans from share-member 142
583

108
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

2. PRIOR PERIOD ERRORS AND RESTATEMENTS (continued)

2.2 Reconciliation of Surplus for period ended 30 June 2007

Previously Prior Restated

reported Period
errors
R’000 R’000 R’000

Revenue 368 211 - 368 211

Gross surplus 353 276 - 353 276

Operating expenses (355 661) - (355 661)

Operating deficit (2 385) - (2 385)

Investment income 19 599 172 19 771

Finance costs (7 732) - (7 732)

Surplus for the period 9 482 172 9 654

3. PROPERTY, PLANT AND EQUIPMENT

2007 2008

COST ACCUMULATED CARRYING COST ACCUMULATED CARRYING

DEPRECIATION VALUE DEPRECIATION VALUE
R’000 R’000 R’000 R’000
R’000 R’000

Land and
buildings 12 679 - 12 679 24 058 - 24 058
Leasehold
improvements 849 (487) 362 849 (594) 255
Plant and
equipment 12 836 (6 221) 6 615 18 177 (7 525) 10 652
Park facilities 591 (372) 219 591 (416) 175
Office
equipment 4 205 (2 424) 1 781 6 366 (2 881) 3 485
Computer
equipment 4 809 (2 093) 2 716 7 361 (3 555) 3 806
Spare
parts 964 - 964 1 252 - 1 252
Total 36 933 (11 597) 25 336 58 654 (14 971) 43 683

109
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

3. PROPERTY, PLANT AND EQUIPMENT (continued)

RECONCILIATION OF PROPERTY, PLANT AND EQUIPMENT

2007
Carrying Additions Disposals Carrying value
value at Depreciation at end of year
beginning of
year
R’000 R’000
R’000 R’000 R’000
Land and
buildings
Leasehold - 12 679 - - 12 679
improvements
Plant and 151 459 - (248) 362
equipment
Park facilities 5 109 2 605 (365) (734) 6 615
Office equipment 325 - - (106) 219
Computer 1 421 788 (5) (423) 1 781
equipment
Spare 2 680 1 407 (494) (877) 2 716
parts
1 552 - (588) - 964
Total 11 238 17 938 (1 452) (2 388) 25 336

2008
Carrying Additions Disposals Carrying value
value at Depreciation at end of year
beginning of
year
R’000 R’000
R’000 R’000 R’000
Land and
buildings
Leasehold 12 679 11 379 - - 24 058
improvements
Plant and 362 - - (107) 255
equipment
Park facilities 6 615 6 415 (229) (2 149) 10 652
Office equipment 219 - - (44) 175
Computer 1 781 2 281 (78) (499) 3 485
equipment
Spare 2 716 2 480 (17) (1 373) 3 806
parts
964 288 - - 1 252
Total 25 336 22 843 (324) (4 172) 43 683

110
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

3. PROPERTY, PLANT AND EQUIPMENT (continued)

FINANCE LEASED ASSETS

2007 2008

COST ACCUMULATED CARRYING COST ACCUMULATED CARRYING

DEPRECIATION VALUE DEPRECIATION VALUE
R’000 R’000 R’000 R’000
R’000 R’000

Office
equipment 510 (205) 305 565 (378) 187

Total 510 (205) 305 565 (378) 187

RECONCILIATION OF FINANCE LEASED ASSETS

2007
Carrying value Additions Disposals Carrying value
at beginning Depreciation at end of year
of year
R’000 R’000
R’000 R’000 R’000

Office
equipment 405 - (188) 305
88
Total 88 405 - (188) 305

2008
Carrying value Additions Disposals Carrying value
at beginning Depreciation at end of year
of year
R’000 R’000
R’000 R’000 R’000

Office
equipment 305 55 - (173) 187

Total 305 55 - (173) 187

111
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

4. INTANGIBLE ASSETS

2007 2008

COST ACCUMULATED CARRYING COST ACCUMULATED CARRYING

AMORTISATION VALUE AMORTISATION VALUE
R’000 R’000 R’000 R’000
R’000 R’000

IT Software 7 600 (2 960) 4 640 8 242 (4 399) 3 843

Total 7 600 (2 960) 4 640 8 242 (4 399) 3 843

RECONCILIATION OF INTANGIBLE ASSETS

2007
Carrying value Additions Disposals Carrying value
at beginning Amortisation at end of year
of year
R’000 R’000
R’000 R’000 R’000

IT software 2 419 (193) (2 006) 4 640

4 420
Total 4 420 2 419 (193) (2 006) 4 640

2008
Carrying value Additions Disposals Carrying value
at beginning Amortisation at end of year
of year
R’000 R’000
R’000 R’000 R’000

IT software 4 640 642 - (1 439) 3 843

Total 4 640 642 - (1 439) 3 843

112
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

5. EMPLOYEE BENEFITS

Post-Employment Benefit Funds:

The City of Johannesburg Metropolitan Municipality and its associated Municipal Entities (ME’s) provide
post-employment benefits to all their permanent employees through eight defined contribution funds,
five defined benefit funds and two hybrid funds. The following funds provide benefits for the group
employees:

Defined Contribution Funds:

 E-Joburg Retirement Fund
 City Power Retirement Fund
 Municipal Employees Gratuity Fund
 Municipal Gratuity Fund
 National Fund for Municipal Workers
 Meshawu National Local Authorities Retirement Fund
 Municipal Councillors Pension Fund
 South African Municipal Workers Union National Provident Fund

In the case of these defined contribution funds, the contributions paid have been expensed as required
in terms of IAS 19.

Defined Benefit Funds:

 Johannesburg Municipal Pension Fund
 City of Johannesburg Pension Fund
 Soweto City Council Pension Fund
 South African Local Authorities Pension Funds
 Diepmeadow Pension Fund

Hybrid Funds:
 Municipal Employees Pension Fund
 Joint Municipal Pension Fund

Management, as a result of insufficient information of the multi-employer plans being available, could
not determine the proportionate share of the obligation, plan assets and associated costs for any of the
defined benefit funds. Accordingly, all funds have been accounted for using a defined-contribution basis
at the ME level.

However, full-defined benefit accounting has been applied at the Group level in the accounts of the
Group for the City of Johannesburg Pension Fund, Johannesburg Municipal Pension Fund, South
African Local Authorities Pension Fund and Soweto City Council Pension Fund. The City of
Johannesburg Metropolitan Municipality has undertaken to carry all pension obligations up to the 30
June 2008.

Contributions to the Diepmeadow Pension Fund were ceased for the Group with effect from 31 July
2003. Benefits have been made paid up and will accumulate for members on a defined contribution
basis.

113
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

5. EMPLOYEE BENEFITS (continued)

Other Employee Benefits

o Post Retirement Medical Aid Liabilities

The Company has obligations to subsidise medical aid contributions in respect of certain qualifying staff
and pensioners and their surviving spouses. Only pensioners and employees who were aged 50 or over
and were members of LA Health and Key Health medical schemes on 1 July 2003 are eligible for
benefits. The amount of the subsidy is 60% for pensioners and members older than 55 on 1 July 2003
and 60% for other qualifying employees and is subject to a maximum of R 1 953 per month. The
subsidy maximum increases annually on 1 July in accordance with the general ‘cost of living’ salary
increase in the City of Johannesburg Metropolitan Municipality.

The above liability is unfunded. However, the City of Johannesburg Metropolitan Municipality has
undertaken to cover such portion of the liability for staff of the Company who are entitled to benefits that
relate to their service with the City of Johannesburg Metropolitan Municipality before the Company was
established. This amount was determined as at 1 July 2003 and has been crystallised in the form of
notional loan accounts which earn interest and against which the Company may claim benefit payments
made. This loan account does not constitute a plan asset and in terms of IAS 19 cannot be offset
against the liability. It has however been included in the Statement of Financial Position of the Company
as an asset.

2008 2007
Post Retirement Medical Obligation

R’000 R’000
Amounts recognised in the Statement of Financial Position
Present value of unfunded obligation 21 989 22 778

Amounts recognised in the Statement of Financial Performance

Finance Cost 2 000 2 000
Net Current Year Service Cost 791 810
Actuarial (Gain)/Loss (3 344) (1 969)
Total included in costs (553) 841

Movements in amount recognised in the Statement of Financial Position

Liability at start of the year 22 778 22 172
Net expense recognised in the Statement of Financial Performance (553) 841
Benefit payments (236) (235)
Liability at end of the year 21 989 22 778

Notional Loan Account with the City of Johannesburg Metropolitan

Municipality
Amounts recognised in the Statement of Financial Position
Face value of loan account 15 638 14 281

Amounts recognised in the Statement of Financial Performance

Investment Income in respect of the account 1 357 1 058

Movements in amount recognised in the Statement of Financial Position

114
 Face value at start of the year 14 281 13 223
Investment Income 1 357 1 058
Payments claimed against the account - -
Face value at end of the year 15 638 14 281
Key Assumptions
Discount Rate 9.5% 8.00%
Expected return on assets 9.5% 8.00%
Rate of increase in employer post retirement medical aid contributions 7.5% 5.75%

JOHANNESBURG CITY PARKS

Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

5. EMPLOYEE BENEFITS (continued)

o Post Retirement Medical Aid Liabilities (continued)

A sensitivity analysis was undertaken on the impact of medical aid contribution increases. The liability is
sensitive to the real rate of return earned (i.e. the difference between the rate of discount and the rate at
which medical aid contributions increase). The sensitivity analysis undertaken utilised alternative real
rates by varying the assumed rate of discount in order to demonstrate the impact on the accrued
liability. The sensitivity analysis yields very similar results if, instead of varying the assumed rate of
discount, the assumed rate of increase in medical scheme contributions is increased and decreased by
1%. The valuation accounted for was based on 9,5%, as shown in bold.

Rate of discount Active members Pensioners Total Percentage

(real rate of (R’000) change
discount) (R’000) (R’000)
8.5% 15,322 3,583 18,905 -14,03%
9.5% 18,022 3,967 21,989 0%
10.5% 21,445 4,426 25,871 17,65%

115
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

5. EMPLOYEE BENEFITS (continued)

o Post Retirement Housing Subsidy

The Company provides housing subsidies in respect of certain qualifying staff. In the event that the
housing loan that the subsidy relates to is not fully paid at retirement date the subsidy will continue in
the member’s retirement. The subsidy amount is based on the subsidy being received at the date of the
valuation. It is assumed to remain constant and to continue for a period of 10 years after retirement.

The above liability is unfunded. However, the City of Johannesburg Metropolitan Municipality has
undertaken to cover such portion of the liability for staff of the Company who are entitled to benefits that
relate to their service with the City of Johannesburg Metropolitan Municipality before the Company was
established. This amount was determined as at 1 July 2003 and has been crystallised in the form of
notional loan accounts which earn interest and against which the Company may claim benefit payments
made. This loan account does not constitute a plan asset and in terms of IAS 19 cannot be offset
against the liability. It has however been included in the Statement of Financial Position of the Company
as an asset.

2008 2007
R’000 R’000
Post Retirement Housing Subsidy
Amounts recognised in the Statement of Financial Position
Present value of unfunded obligation 15 15

Amounts recognised in the Statement of Financial Performance

Finance cost 1 6
Net current year service cost 1 1
Actuarial gain (2) (55)
Total included in costs - (48)

Movements in amount recognised in the Statement of Financial Position

Liability at start of the year 15 63
Net expense recognised in the Statement of Financial Performance - (48)
Liability at end of the year 15 15

Notional Loan Account with the City of Johannesburg Metropolitan

Municipality
Amounts recognised in the Statement of Financial Position
Face value of loan account 113 103

Amounts recognised in the Statement of Financial Performance

Investment Income in respect of the account 10 7

Movements in amount recognised in the Statement of Financial Position

Face value at start of the year 103 96
Investment income 10 7
Face value at end of the year 113 103

Key Assumptions
Discount Rate 9.5% 8.0%
Expected return on assets 9.5% 8.0%
Rate of increase in housing subsidy payments 0.0% 0.0%

116
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

5. EMPLOYEE BENEFITS (continued)

o Gratuity Liabilities

The Company provides gratuities on retirement or prior death (i.e. for those members that have died
prior to retirement date) in respect of employees who have service with the City of Johannesburg
Metropolitan Municipality or the Company when they were not members of one of the retirement funds
and who meet certain service requirements in terms of the City of Johannesburg Metropolitan
Municipality’s conditions of employment. The gratuity amount is based on 1 (one) month’s salary per
year of non-retirement funding service and a bonus of 1 (one) month’s salary for every 5 (five)
completed years of non-retirement funding service.

The above liability is unfunded. However, the City of Johannesburg Metropolitan Municipality has
undertaken to cover such portion of the liability for staff of the Company who are entitled to benefits that
relate to their service with the City of Johannesburg Metropolitan Municipality before the Company was
established. This amount was determined as at 1 July 2003 and has been crystallised in the form of
notional loan accounts which earn interest and against which the Company may claim benefit payments
made. This loan account does not constitute a plan asset and in terms of IAS 19 cannot be offset
against the liability. It has however been included in the Statement of Financial Position of the Company
as an asset.

2008 2007
R’000 R’000
Gratuity Liability
Amounts recognised in the Statement of Financial Position
Present value of unfunded obligation 66 651 64 913

Amounts recognised in the Statement of Financial Performance

Finance cost 5 078 5 680
Actuarial loss/(gain) 1 706 (1 267)
Total included in costs 6 784 4 413

Movements in amount recognised in the Statement of Financial Position

Liability at start of the year 64 913 65 731
Net expense recognised in the Statement of Financial Performance 6 784 4 413
Benefit payments (5 046) (5 231)
Liability at end of the year 66 651 64 913

Notional Loan Account with the City of Johannesburg Metropolitan

Municipality
Amounts recognised in the Balance Statement of Financial Position
Face value of loan account 52 824 51 999

Amounts recognised in the Statement of Financial Performance

Investment income in respect of the account 4 820 2 165

Movements in amount recognised in the Statement of Financial Position

Face value at start of the year 51 999 55 065
Adjustment to opening balance 171 -
Investment income 4 820 2 165
Payments claimed against the account (4 166) (5 231)
Face value at end of the year 52 824 51 999

Key Assumptions
Discount rate 9.5% 8.0%
Expected return on assets 9.5% 8.0%
Rate of increase in salaries 7.0% 5.5%

117
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

5. EMPLOYEE BENEFITS (continued)

o Annual Leave Liabilities

The liability is calculated as the full value of accrued annual leave as if paid out with immediate effect to
all employees, based entirely on the ‘package remuneration’ at the valuation date.

The above liability is unfunded. However, the City of Johannesburg Metropolitan Municipality has
undertaken to cover such portion of the liability for staff of the Company who are entitled to benefits that
relate to their service with the City of Johannesburg Metropolitan Municipality before the Company was
established. This amount was determined as at 1 July 2003 and has been crystallised in the form of
notional loan accounts which earn interest and against which the Company may claim benefit payments
made. This loan account does not constitute a plan asset and in terms of IAS 19 cannot be offset
against the liability. The City of Johannesburg Metropolitan Municipality paid out the balance of the
notional account during the year.

2008 2007
R’000 R’000
Annual Leave Liability
Amounts recognised in the Statement of Financial Position
Present value of unfunded obligation - 9 739

Amounts recognised in the Statement of Financial Performance

Net current year charge - (2 326)
Total included in employee remuneration costs - (2 326)

Movements in amount recognised in the Statement of Financial Position

Liability at start of the year 9 789 12 115
Net expense recognised in the Statement of Financial Performance - (2 326)
Liability at end of the year (see note 11-Provisions) 9 789 9 789

Notional Loan Account with the City of Johannesburg Metropolitan

Municipality
Amounts recognised in the Statement of Financial Position
Face value of loan account - 7 627

Amounts recognised in the Statement of Financial Performance

Investment income in respect of the account - -

Movements in amount recognised in the Statement of Financial Position

Face value at start of the year 7 627 7 627
Benefit payments - -
Investment income - -
Payment of notional loan account asset (7 627) -
Face value at end of the year - 7 627

118
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

5. EMPLOYEE BENEFITS (continued)

o Summary

Employee Benefit Investment

2008 2007
R’000 R’000

Post retirement medical aid 15 638 14 281

Post retirement housing subsidy 113 103
Gratuity 52 824 51 999
Annual leave - 7 627
_____ _____
Total 68 575 74 010

Employee Benefit Obligation

2008 2007
R’000 R’000

Post retirement medical aid 21 989 22 778

Post retirement housing subsidy 15 15
Gratuity 66 651 64 913
_____ _____
Total 88 655 87 706

119
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

6. TRADE AND OTHER RECEIVABLES

Restated
2008 2007
R’000 R’000

Trade receivables 9 545 2 034

VAT 4 823 2 356
1
Group companies receivables 4 574 11 123
- City of Joburg Property Company (Proprietary) Limited 64 119
- City Power Johannesburg (Proprietary) Limited 3 510 10 160
- Piki Tup Johannesburg (Proprietary) Limited 60 560
- Johannesburg Roads Agency (Proprietary) Limited 208 280
- Johannesburg Tourism Company (Proprietary) Limited 14 4
- Johannesburg Fresh Produce Market (Proprietary) Limited - -
- Johannesburg Civic Theatre (Proprietary) Limited - -
- Johannesburg Zoo - -
- Johannesburg Development Agency (Proprietary) Limited - -
- Metropolitan Trading Company (Proprietary) Limited - -
- Johannesburg Water (Proprietary) Limited 718 -
- Johannesburg Social Housing (Proprietary) Limited - -
- Johannesburg Metropolitan Bus Services (Proprietary) Limited - -
- Roodepoort City Theatre - -
- City Housing Company (Proprietary) Limited - -
2
Member’s receivables 35 802 34 872
- Capital projects 27 916 13 750
- Employee Benefits - 172
- Development Contributions 3 912 18 425
- Other 3 974 2 526
Subsequent fair value measurement of trade receivables at year
end (336) (130)
_____ _____
Total 54 408 50 255

Credit Quality of Trade and Other Receivables

Trade receivables compromise two main categories: government (including group companies) and
corporate. Management evaluates credit risk relating to customers on an ongoing basis. The
assessment takes into account the financial position, past experiences and other factors.

Revenue within the cemetery fee environment is considered cash, as the economic benefit of the
service only passes when funds have been banked. Returned cheques within this environment result in
the blacklisting of the undertaker concerned. Revenue within the External Services environment is
exclusively with government, including group companies.

Trade and other receivables are measured at initial recognition at fair value, and are subsequently
measured at amortised cost using the effective interest rate method.

1
This relates to monies owing from other Municipal Owned Entities within the City of Johannesburg Metropolitan
Municipality
2
This represents monies owing for capital projects, movable assets, external services and current employee benefits from
the City of Johannesburg Metropolitan Municipality

120
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

6. TRADE AND OTHER RECEIVABLES (continued)

Trade and Other Receivables past due but not impaired

Trade and Other Receivables which are past due are not considered to be impaired.

The aging of amounts past due but not impaired is as follows:

2008 2007
R’000 R’000 R’000 R’000 R’000 R’000

30 60 90 +90 Total Total

days days days days
Government 2 320 1 356 1 668 4 335 9 679 6 247
Corporate 5 331 173 583 4 6 091 549
Total 7 651 1 529 2 251 4 339 15 770 6 796

During the year, the company wrote off R 6 682 in bad debts.

7. NOTES TO THE CASH FLOW STATEMENT

7.1 Cash generated from operations is calculated as follows:

Restated
2008 2007
R’000 R’000

Operating (Deficit)/Surplus (4 126) 9 654

Adjustments:
- Depreciation and Amortisation 5 784 4 581
- Investment Income (26 559) (19 771)
- Finance Cost 7 152 7 732
- (Profit)/Deficit on sale of assets (712) 234
- Movement on retirement benefit assets and liabilities 949 (260)
- Movement in provisions (13) (2 005)
- Other non-cash items due to prior period errors - 413

Operating cash flows before movements in working capital (17 525) 578

Increase in trade and other payables 14 053 3 477

Increase in inventory (3 126) (586)
Increase in trade and other receivables (4 153) (12 098)
____ __ ____ __
Cash utilised in operations (10 751) (8 629)

121
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

7. NOTES TO THE CASH FLOW STATEMENT (continued)

7.2 Cash and cash equivalents

The company operates a current account with ABSA Ltd.

This account is swept every evening via the City of Johannesburg Metropolitan Municipality’s Treasury
department. Thus the current account balance is shown as a Loan to the Sharemember and at 30 June
2008 the balance on the account was R 181 196 040. (2007 – R 189 747 862)

Cash and cash equivalents consist of cash on hand. Cash and cash equivalents included in the cash
flow statement comprise the following Statement of Financial Position amounts:

2008 2007
R’000 R’000

Cash and cash equivalents 32 21

8. INVENTORY

2008 2007
R’000 R’000

Trees 3 262 -
Consumable Stores 450 586
Total Inventory 3 712 586

9. LOANS TO/(FROM) SHARE-MEMBER

Current Assets
2008 2007
R’000 R’000

Sweeping Account 181 196 189 748

The above loan represents a treasury loan account. The loan is unsecured and accrues interest
daily.

Loans to Share-member

The loans to the share-member are measured at initial recognition at fair value, and are
subsequently measured at amortised cost using the effective interest rate method.

Loans to Share-member past due but not impaired

Loans to the share-member are not considered to be impaired.

122
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

9. LOANS TO/(FROM) SHARE-MEMBER (continued)

Current Liabilities

R’000
Balance at 1 July, 2006 (25 907)
4
Investment by member (2 333)

Balance at 1 July, 2007 (28 240)

Prior period error 142

Balance at 30 June 2008 (28 098)

The above loan is unsecured, finance cost free, and has no fixed repayment terms.
The above loan is at amortised cost.

Loans from Share-member

The loans from the share-member are measured at initial recognition at fair value, and are
subsequently measured at amortised cost using the effective interest rate method.

Loans from Share-member past due but not impaired

Loans from the share-member are not considered to be impaired.

3
This relates to investment by the sole member, the City of Johannesburg Metropolitan Municipality, in the acquisition of
movable assets.

123
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

10. TRADE AND OTHER PAYABLES

Restated
2008 2007
R’000 R’000

Trade payables 60 959 47 501

Accruals 18 577 16 675
- Accrued operating expenses 8 443 5 661
- Performance bonus+ - 3 651
- Annual bonus+ - 6 382
- Leave pay* 9 789 -
- Personnel costs 345 981
Trade payables: inter-company 7 387 10 026
- City of Johannesburg Metropolitan Municipality 2 177 2 647
- City Power Johannesburg (Proprietary) Limited 686 1 031
- Johannesburg Water (Proprietary) Limited 4 364 5 684
- Pikitup Johannesburg (Proprietary) Limited 137 379
- Johannesburg Roads Agency (Proprietary) Ltd - 222
- Johannesburg Zoo 16 43
- Johannesburg Development Agency (Proprietary)
Limited - -
- Metropolitan Trading Company (Proprietary) Limited - -
- Johannesburg Social Housing (Proprietary) Limited - -
- Roodepoort City Theatre - -
- City Housing Company (Proprietary) Limited - -
- Johannesburg Tourism Company (Proprietary)
Limited - -
- City of Joburg Property Company (Proprietary)
Limited 5 -
- Johannesburg Fresh Produce Market (Proprietary)
Limited - -
- Johannesburg Metropolitan Bus Services
(Proprietary) Limited - 6
- Johannesburg Civic Theatre (Proprietary) Limited 2 14
5
Pre-payment on CMIP project 18 135
6
Monies held in trust 58 701 59 393
Learnership Grant 133 -
Pre-payment on capital developments 1 991 -
Subsequent fair value measurement of trade payables
at year end (16) (33)
______ ______
Total 147 750 133 697

* Annual and Performance Bonus transferred to Provisions

+ Leave Pay transferred from Provisions

Trade and other payables are at amortised cost.

5
These funds are Municipal Infrastructure Grant funds for the continued development of Dorothy Nyembe Park in Soweto,
for which purpose they are retained.
6
These funds consist of development contributions towards engineering/development of bulk services, e.g. parks in terms of
the Township and Town Planning Ordinance 1986, and are accordingly to be utilised for capital projects, for which purpose
they are retained.

124
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

11. PROVISION

Opening Provision Additional Closing

Balance At utilised Provision Balance at
Beginning during the End of Year
of Year Year
Restated
R’000 R’000
R’000 R’000
Legal Proceedings
Annual leave* 371 (371) - -
Performance Bonus+ 9 739 (9 739) - -
Annual Bonus+ - - 4 629 4 629
- - 5 468 5 468
Total 10 110 (10 110) 10 097 10 097

*Annual leave transferred to Trade and Other Payables: Accruals

+Annual and Performance Bonus transferred from Trade and Other Payables: Accruals

12. REVENUE

Revenue comprise government grants related to income received from the City of Johannesburg
Metropolitan Municipality for fulfilling the Company’s mandate, and from hiring of venues, the sale of
cemetery plots and the provision of grass cutting services to related parties. All revenue is of exchange
in nature.

Major classes of exchange revenue comprise:

2008 2007
R’000 R’000

Government grants related to income 364 145 335 679

External services 42 344 15 311
Admission fees (Hiring of facilities) 1 217 992
Cemetery fees 15 475 14 143
Project admin fees 895 432
Sundry revenue 1 561 1 785
Subsequent fair value measurement of trade receivables
at year end (323) (130)
_______ _______
Total 425 314 368 211

125
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

13. OPERATING (DEFICIT)/SURPLUS

Operating (deficit)/surplus is stated after:

2008 2007
R’000 R’000

Expenditure
Auditor’s remuneration
- Audit Fee: Current year 682 641
Depreciation and amortisation
- Property, plant and equipment 4 345 2 575
- Intangible assets 1 439 2 006
Employee costs 273 038 240 943
Legal costs 336 310
Lease rentals 34 590 25 992
- Premises 2 416 2 580
- Equipment 213 238
- Fleet: Lease 31 961 23 174

Included in depreciation and amortisation is a change in estimate of R 812 804, arising from the review
of the residual values and useful lives of property, plant & equipment. The initial impact on future
periods will result in the above amount being recognised as an expense in future periods. The impact
per specific period will be assessed when the residual values and useful lives are reviewed on an
annual basis.

14. INVESTMENT INCOME

Restated
2008 2007
R’000 R’000

Interest on trade and receivables sweeping account 20 256 16 323

Interest on notional employee loan account 6 187 3 402
Interest on subsequent fair value measurement of trade
receivables at year end 116 46
Total investment income 26 559 19 771

15. FINANCE COSTS

2008 2007
R’000 R’000

Interest on employee liabilities ( 7 079) (7 686)

Interest on finance lease (35) (46)
Interest on late payment of creditors (5) (-)
Interest on subsequent fair value measurement of trade
payables at year end (33) (-)
Total finance costs (7 152) (7 732)

126
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

16. EMOLUMENTS

16.1 Executive Directors

2008 2007
R’000 R’000 R’000 R’000 R’000

Salary Travel Bonus Total Total

LL Williamson 1 247 32 255 1 534 981

16.2 Non- Executive Directors

2008 2007
R’000 R’000

Directors Directors
Fees Fees
G Zabala 231 121
PF Radebe (resigned 31 January 2007) - 71
A Carolissen 109 94
M Bahula 85 41
DW Kirkby (resigned 31 January 2007) - 32
N Mabaso 106 85
K Venier (appointed 31 January 2007) 91 21
SMB Nyalunga 81 64
TB Nzimakwe 158 99
HAB Sutherland (resigned 31 January 2007) - 45
V Ramsingh (appointed 31 January 2007) 129 41
H Kasan (appointed 31 January 2007) 89 38
L Williamson ( 1 March 2007 to 30 June 2008) - 517
Total 1 079 1 269

127
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

16. EMOLUMENTS (continued)

16.3 Senior Management

2008 2007
R’000 R’000 R’000 R’000 R’000

Position Salary Travel Bonus Total Total

G Cooke Operations Executive: 875 80 191 1 146 1 112
HH Fouche Marketing and Communications
Executive 795 91 177 1 063 999
HG Nel Company Secretary (resigned 31
May 2007) - - - - 999
DT Nkosi Human Resources Executive
(resigned 30 April 2007) - - - - 861
L Radzuma General Manager: Assurance
Services 591 55 64 710 561
KJ van Eck Chief Financial Officer 835 120 191 1 146 1076
B Andrews Acting Human Resources Executive
(July to November 2008) 228 20 51 299 118
A Buzo- Human Resources Executive
Gqoboka (appointed 1 December 2007) 454 42 99 595 -
M Sayed Company Secretary
Hassan (appointed 1 September 2007) 378 54 90 522 55
P Meyer Operations Executive: Infrastructure
(appointed 1 June 2008) 65 7 172 244 298
4 221 469 1 035 5 725 6 079

17. TAXATION

The City of Johannesburg Metropolitan Municipality enjoys tax-exempt status in terms of section
10(1)(b) of the Income Tax Act, 1962 (Act No. 58 of 1962) (‘the Income Tax Act’).

The Company was incorporated on 9 November 2000 in order to undertake nature conservation as
envisaged in section 10 (1)(cB)(i)(cc) of the Income Tax Act, as well as certain designated municipal
functions of a public nature previously performed by the City of Johannesburg Metropolitan Municipality.

In terms of the provisions of section 21 (2)(a) of the Amended Income Tax Act No. 30 of 2000, the
Company would continue to enjoy tax-exempt status in terms of section 10(1)(cB) until the
Commissioner approves the exempt status in terms of section 30 of the Act. During December 2003,
the Company made application as a Public Benefit Organisation, and in January 2006 was awarded
such status in terms of section 30 of the Income Tax Act No.30 of 2000 and section 10(1)(cN) of the
Income Tax Act No.58 of 1962.

128
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

18. COMMITMENTS

18.1 Authorised Capital Expenditure

Already contracted for but not provided for

2008 2007
R’000 R’000

Land and buildings 75 8 000

Plant and equipment - 4 041
Intangible assets - -
Total 75 12 041

This committed expenditure relates to the improvements to the administrative Head Office at 40 De
Korte Street Braamfontein.

18.2 Operating Leases – as lessee (expense)

Minimum lease payments due

2008 2007
R’000 R’000

Within one year 23 281 14 973

In second to fifth year 43 131 36 835
Thereafter 4 753 4 786
Total 71 165 56 594

Operating lease payments represent rentals payable by the company for the fleet and the Waterval
Cemetery. The fleet lease ends in January 2011 and the Waterval Cemetery in June 2103. The
company has entered into a 99 year lease on a portion of land designated as a public cemetery.

18.3 Finance Lease Obligations

Minimum lease payments due

2008 2007
R’000 R’000

Within one year 197 198

In second to fifth year 36 178
233 376
Less: future finance charges 18 33
Present value of minimum lease payments due 215 343

129
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

Present Value of minimum lease payments due

2008 2007
R’000 R’000

Within one year 183 170

In second to fifth year 32 173
Total 215 343

It is company policy to lease certain office equipment under finance leases. The average lease term is 3
years and the average effective borrowing rate was 12,75%. Interest rates fluctuate with the prime
lending rate.

19. CONTINGENT LIABILITY

2008 2007
R’000 R’000

Legal costs – ex employees 371 -

South African Local Government Bargaining Council (“SALGBC”) 137 72
508 72

This represents the company’s portion of levies imposed by SALGBC to all employees within a
municipality and its entities. However SALGBC does not recognise the company as an employer, and
thus the company has no right of representation.
Certain grievances were adjudicated by the SALGBC on behalf on previous employees. As the
company is not recognised by such a body, these awards were made in abstentia.

20. NEW ACCOUNTING STANDARD PRONOUNCEMENTS

Accounting pronouncements not adopted at 30 June 2008

In the current year, the company has noted all of the new and revised Standards and Interpretations
issued by the International Accounting Standards Board (“IASB”) and the International Financial
Reporting Interpretations Committee of the IASB that are relevant to its operations. Where applicable,
the adoption of these new and revised Standards and Interpretations has had minimal impact on the
company.

IAS 23 Borrowing costs

The option of immediately recognising as an expense borrowing costs that relate to assets that take a
substantial period of time to get ready for use or sale, has been removed. An entity is therefore
required to capitalise borrowing costs as part of the cost of such assets. The only exceptions are the
capitalisation of borrowing costs relating to assets measured at fair value, and inventories that are
manufactured or produced in large quantities on a repetitive basis, even if they take a substantial period
of time to get ready for use or sale.

The revised Standard applies to borrowing costs relating to qualifying assets for which the
commencement date for capitalisation is on or after 1 January 2009. However, early adoption is
permitted and encouraged.

The company does not believe that the adoption of the interpretation will have any effect.

130
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

20. NEW ACCOUNTING STANDARD PRONOUNCEMENTS (continued)

Accounting pronouncements not adopted at 30 June 2008 (continued)

IFRS 8 Operating Segments

This Standard required an entity to report financial and descriptive information about its reportable
segments, which are operating segments or aggregations of operating segments that meet specified
criteria. Operating segments are components of an entity about which separate financial information is
available that is evaluated regularly by the chief operating decision maker in deciding how to allocate
resources and in assessing performance. The amount reported for each segment item is the measure
reported to the chief operating decision maker for these purposes.

The Standard applies to annual periods beginning on or after 1 January 2009. However, early adoption
Is permitted and encouraged.

The company does not believe that the adoption of the interpretation will have any effect.

In addition, the company noted the following revised accounting Standards and Interpretations which
had no material impact on the results:

IAS 19 Employee benefits – Option to recognise actuarial gains and losses in full, outside
profit or loss, in a statement of changes in equity;

IAS 39 Financial Instruments Recognition and Measurement – Amendment for hedges of
forecast intra-group transactions;

IAS 39 Financial Instruments Recognition and Measurement – Amendment for fair value
option;

IAS 39 Financial Instruments Recognition and Measurement – Amendment for financial
guarantee contracts;

IFRIC 4 Determining whether an arrangement contains a Lease;

IFRIC 5 Rights to Interests arising from Decommissioning, Restoration and Environmental
Rehabilitation Funds;

IFRIC 6 Liabilities arising from participating in a Specific Market – Waste Electrical and
Electronic Equipment;

IFRIC 7 Applying the Restatement Approach under IAS 29 Financial Reporting in
Hyperinflationary Economies:

IFRIC 8 Scope of IFRS 2 – Shared Based Payments

IFRIC 9 Reassessment of Embedded Derivatives

IFRIC 10 Interim Financial Reporting and Impairment

IFRIC 11 IFRS 2: Group and Treasury Share Transactions;

IFRIC 12 Service Concession Arrangements; and

IFRIC 13 Customer Loyalty Programmes.

131
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

20. NEW ACCOUNTING STANDARD PRONOUNCEMENTS (continued)

At the date of authorisation of these financial statements, the following new Standards and
Interpretations were in issue but not yet effective:

IFRIC 14 IAS 19: The Limit on a Defined Benefit Asset, Minimum Funding
Requirements and their Interaction – effective for periods starting on/after 1 January
2008

IFRIC 15: Agreements for the Construction of Real Estate – effective for periods
starting on/after 1 January 2009

IFRIC 16: Hedges of a Net Investment in a Foreign Operation – effective for periods
starting on/after 1 October 2008

At the date of authorisation of these financial statements, the following revised Standards and
Interpretations were in issue but not yet effective:

IFRS 2: Share Based Payments – effective for periods starting on/after 1 January 2009

IFRS 3: Business Combinations – effective for business combinations in annual periods
beginning on or after 1 July 2009, which consequently amended IAS 27: Consolidated
and Separate Financial Statements, IAS 28: Investments in Associates and IAS 31:
Interest in Joint Ventures.

The company anticipates that the adoption of this Standard and Interpretations in future periods will
have no material financial impact on the financial statements of the group.

Accounting pronouncements adopted at 30 June 2008

IFRS 7 Financial Instruments: Disclosures (including amendments to IAS 1

Presentation of Financial Statements)

The company has adopted IFRS 7 and the amendments to IAS 1 with effect from 1 July 2007. This has
resulted in increased disclosure relating to financial instruments, but has had no impact on the reported
profits or financial position of the company. In accordance with the transitional requirements of the
standards, the company has provided full comparative information.

In addition to the notes to the annual financial statements, disclosures under IFRS 7 relating to the
nature and extent of risks may be found in the risk management section.

132
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

21. RELATED PARTIES

Identity of related parties

The Company’s sole member is the City of Johannesburg Metropolitan Municipality.

The Directors are listed in the Directors’ Report.

2008 2007
R’000 R’000
Purchase of goods and services

Purchase of services:

City of Johannesburg Metropolitan Municipality - Water and

Electricity 7 848 6 969
City of Johannesburg Metropolitan Municipality - Hostel Charges 878 3 401
City of Johannesburg Metropolitan Municipality – Insurance 4 508 3 729
City of Johannesburg Metropolitan Municipality – Other 314 132
City Power (Proprietary) Limited– Electricity & other 665 958
Johannesburg Water (Proprietary) Limited– Water & other 1 280 3 989
Piki Tup Johannesburg (Proprietary) Limited- Refuse removal 923 890
Johannesburg Metropolitan Bus Services (Proprietary) Limited
– Bus Hire 7 64
Johannesburg Civic Theatre (Proprietary) Ltd – Water 30 82
Johannesburg Roads Agency (Proprietary) Ltd - -
Johannesburg Zoo - -
Johannesburg Development Agency (Proprietary) Limited - -
Metropolitan Trading Company (Proprietary) Limited - -
Johannesburg Social Housing (Proprietary) Limited 2 420 -
Roodepoort City Theatre - -
City Housing Company (Proprietary) Limited - -
Johannesburg Tourism Company (Proprietary) Limited - -
City of Joburg Property Company (Proprietary) Limited 2 -
Johannesburg Fresh Produce Market (Proprietary) Limited - -
_____ _____
TOTAL 18 875 20 214

The services were supplied by related parties within the City of Johannesburg Metropolitan Municipality.

No transactions were entered into with the Directors of the company, either directly or indirectly.

133
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

21. RELATED PARTIES (continued)

2008 2007
R’000 R’000

Sales of goods and service

Revenue:

City of Johannesburg Metropolitan Municipality – Government

Grants related to Income 364 145 335 679
City of Johannesburg Metropolitan Municipality – Grass cutting,
tree maintenance and plants 8 266 2 586
City of Johannesburg Metropolitan Municipality - Investment
Income 26 443 19 553
City of Johannesburg Metropolitan Municipality - Project Admin
Fees 325 433
City of Johannesburg Metropolitan Municipality - Sundry
Revenue 2 151 779
Piki Tup Johannesburg (Proprietary) Limited- Grass cutting,
compost and consultancy 66 558
Johannesburg Tourism Company (Proprietary) Limited – Grass
cutting 16 13
City of Joburg Property Company (Proprietary) Limited – Rental 526 476
Johannesburg Roads Agency (Proprietary) Ltd – Grass cutting 671 427
City Power (Proprietary) Limited– Grass cutting, tree
maintenance 29 483 9 207
Johannesburg Water (Proprietary) Limited - -
Johannesburg Metropolitan Bus Services (Proprietary) Limited - -
Johannesburg Civic Theatre (Proprietary) Limited - -
Johannesburg Zoo - -
Johannesburg Development Agency (Proprietary) Limited - -
Metropolitan Trading Company (Proprietary) Limited - -
Johannesburg Social Housing (Proprietary) Limited 2 -
Roodepoort City Theatre - -
City Housing Company (Proprietary) Limited - -
Johannesburg Fresh Produce Market (Proprietary) Limited - -
_____ _____
TOTAL 432 094 369 711

All the income was generated from the City of Johannesburg Metropolitan Municipality and related
parties.

No transactions were entered into with the Directors of the company, either directly or indirectly.

All compensation to Non-Executive Directors, Executive Directors and Senior Management are short-
term employee benefits. These parties do not receive any post-employment benefits or any other long-
term employee benefits. (Refer note 16)

134
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

21. RELATED PARTIES (continued)

In terms of Regulation 45 of the Municipal Supply Chain Management Regulation of 2005, the company
must disclose any awards of more than R 2000 – 00 to a person who is a spouse, child or parent in the
service of the state. The following suppliers have declared their related parties as follows:

2008 2007
Supplier Name of Family Capacity of Amount Amount of
Member Employment of Award Award
R’000 R’000
AA van Duuren M van Duuren Office Manager 22 10
Maawu Radebe Contractors LY Maawu Teacher 887 1 135
Makwenzeke Grass Cutting P Sibiya Human Resources 1 409 313
Merafe Business Enterprise K Ngobeni Process Engineer - 37
Midnight Moon Trading V Leballo Community
Developer 16 26
N&H Demolishing & R Maharaj Traffic Officer
Earthworks 2 443 1 378
Phuti Trading Supply PA Mobure Teacher 997 993
Site Office & Stationery J Masitenyane Education
Supplies Department 24 5

22. RISK MANAGEMENT

Capital Risk Management

The company’s prime objectives when managing capital are to safeguard the company’s ability to
continue as a going concern. This allows the company to maintain an optimal capital structure from
which to leverage and increase service delivery to stakeholders.

The company has set a goal of maintaining a minimum debt-to-equity ratio of 60:40.

Debt is considered to be Current and Non-current liabilities, and equity as Net Assets as noted in the
Statement of Financial Position.

Restated
2008 2007
R’000 R’000

Debt 246 717 231 856

Equity 110 346 113 045
Debt-to-Equity Ratio 69:31 67:33

135
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

22. RISK MANAGEMENT (continued)

Financial Risk Management

The company’s overall risk management strategy is done in conjunction with the central treasury
department within the City of Johannesburg Metropolitan Municipality. The treasury department
identifies, evaluates and hedges financial risks in co-operation with the company.

Liquidity Risk Management

The company’s liquidity risk focuses on ensuring that funds are available to cover current and future
commitments.

The following is a summary of the contractual maturity of the company’s financial liabilities. The
amounts reflected are the contractual undiscounted cash flows.

30 June 2008 Less than 1 Between 1 Between 2 Over 5

year and 2 years and 5 years years

R’000 R’000 R’000 R’000

Share-members loan - - - 28 098
Trade and other payables: government 7 387 - - -
Trade and other payables: corporates 60 959 - - -
Trade and other payables: other 35 719 15 000 28 701 -
_______ _______ _______ _______
Total 104 065 15 000 28 701 28 098

30 June 2007 Less than 1 Between 1 Between 2 Over 5

year and 2 years and 5 years years

R’000 R’000 R’000 R’000

Share-members loan - - - 28 240
Trade and other payables: government 10 026 - - -
Trade and other payables: corporates 47 501 - - -
Trade and other payables: other 31 810 15 000 29 393 -
_______ _______ _______ _______
Total 89 337 15 000 29 393 28 240

136
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

22. RISK MANAGEMENT (continued)

Interest Rate Risk Management

The company has significant interest-bearing assets subject to interest rate fluctuations. This has a
direct bearing on the company’s income and operating cash flows. The asset subject to the above is the
sweepings account with the City of Johannesburg Metropolitan Municipality. The following table
highlights the likely cash flow risk to the company in the event of an interest rate fluctuation. The current
interest rate is 11,24%
2008 2007
R’000 R’000
Interest Rate Sweeping Sweeping
account account

10,24% (1 812) (1 897)

11,24% - -
12,24% 1 812 1 897

The company has significant interest-bearing liabilities subject to interest rate fluctuations. This has a
direct bearing on the company’s expenditure and operating cash flows. The liability subject to the above
is the operating lease held with Fleet Africa for the vehicle fleet. The following table highlights the likely
cash flow risk to the company in the event of an interest rate fluctuation. The current interest rate is
10,40%
2008 2007
R’000 R’000
Interest Rate Fleet lease Fleet lease

11,40% (258) (205)

10,40% - -
9,40% 258 205

Price Risk Management

The company is exposed to international commodity price risk relating to oil/price of fuel. The impact of
fuel price changes on the operating costs of the company is highlighted in the following sensitivity
analysis:

2008 2007
R’000 R’000
Fuel price per litre Fuel cost Fuel cost

+R 0,50 (1 344) (1 331)

Current - -
-R0,50 1 344 1 331

137
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

22. RISK MANAGEMENT (continued)

Credit Risk Management

Credit risk management consists mainly of cash equivalents and trade receivables. The cash resources
are swept on a daily basis via the City of Johannesburg Metropolitan Municipality treasury department.
Trade receivables compromise two main categories: government (including group companies) and
corporate. Management evaluates credit risk relating to customers on an ongoing basis. The
assessment takes into account the financial position, past experiences and other factors.

Financial assets exposed to credit risk at year end were as follows:

Restated
2008 2007
R’000 R’000
Loans to Share-member 181 196 189 748
Trade and other receivables 49 921 47 999

23. IRREGULAR, FRUITLESS AND WASTEFUL EXPENDITURE

2008 2007
R’000 R’000
Interest on late payment to creditors 5 -

138
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)

For the year ended 30 June 2008

24. STATEMENT OF FINANCIAL PERFORMANCE AGAINST BUDGET

Restated
2008 2008 2007 2007

R’000 R’000 R’000 R’000

ACTUAL BUDGET ACTUAL BUDGET

REVENUE
Government Grants related to Income 364 145 364 145 335 679 335 679
Consumer Service Charges 59 036 44 171 30 316 22 205
Other Income 2 845 2 018 2 216 1 715
_______ _______ _______ _______
426 026 410 334 368 211 359 599

COST OF SALES 34 113 24 086 14 935 9 216

GROSS OPERATING SURPLUS 391 913 386 248 353 276 350 383

EXPENDITURE
Employee Related Costs-Wages & Salaries 273 038 271 228 240 943 253 840
Contracted Services 43 500 40 894 34 622 38 986
Consulting Fees 1 079 804 775 510
General Expenses –Other 74 995 71 952 59 434 53 595
Repairs and maintenance 17 050 14 729 15 306 13 146
Depreciation and Amortisation 5 784 6 129 4 581 5 306
_______ _______ _______ _______

OPERATING SURPLUS/(DEFICIT) BEFORE (23 533) (19 488) (2 385) (15 000)
INTEREST
Net Investment Income 19 407 19 488 12 039 15 000
_______ _______ _______ _______

NET (DEFICIT)/SURPLUS (4 126) 0 9 654 0

139
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

DETAILED STATEMENT OF FINANCIAL PERFORMANCE

For the year ended 30 June 2008

2008 2007

R’000 R’000

REVENUE
Government Grants related to Income 364 145 335 679
External Services 42 344 15 181
Admission Fees (Hiring of Facilities) 1 217 992
Cemetery Fees 15 475 14 143
Project Admin Fees 895 432
Sundry Revenue 1 950 1 785
_______ _______
426 026 368 211

COST OF SALES
External Services 30 970 12 446
Cemeteries 2 573 2 489
Project Admin 570 -
_______ _______
34 113 14 935

EXPENDITURE
Advertising 608 475
Animal husbandry and feeds 7 4
Audit fees 682 641
Bad Debts 7 51
Bank charges 138 160
Books and publications 79 54
Chemical control 101 274
Cleaning materials 496 515
Conferences and seminars 711 404
Consulting fees 1 079 775
Consumables 958 1 486
Depreciation and amortization 5 784 4 581
First aid 1 4
Employee costs 273 038 240 943
Exhibits and promotions 214 107
Entertainment and refreshments 546 348
Fleet 43 500 34 622
Fuel and oil 2 499 1 797
Hire of buses and equipment 634 874
Horticulture development 28 739 16 032
Insurance 1 313 1 132
Information Technology 1 457 1 222
Legal expenses 336 310
Loss on disposal of plant and equipment - 232
Balance carried forward 362 969 307 044

140
 JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

DETAILED STATEMENT OF FINANCIAL PERFORMANCE (continued)

For the year ended 30 June 2008

2008 2007

R’000 R’000

Balance brought forward 362 969 307 044

Marketing 3 303 2 546

Membership fees 300 141
Other sundry operating expenses 1 341 532
Postage 10 7
Printing and stationery 1 952 1 714
Protective clothing and uniforms 2 174 1 787
Recruitment costs 460 290
Rental paid 2 628 2 834
Repairs and maintenance 17 050 15 306
Security 7 983 7 114
Telecommunications 3 333 2 956
Training and development 941 948
Utilities 11 043 12 443
_______ _______
415 446 355 661

141
 Annexure E
JOHANNESBURG CITY PARKS
Association Incorporated under Section 21
Registration No. 2000/028782/08

STATEMENT OF FINANCIAL PERFORMANCE AGAINST BUDGET

FOR THE YEAR ENDED 30 JUNE 2008
2008 2008 2008
R'000 R'000 R'000
ACTUAL BUDGET VARIANCE Explanation of Significant Variances

REVENUE
Government Grants related to income 364,145 364,145 -
Consumer Service Charges 59,036 44,171 14,865 Increased External Services Sales Activities
Other Income 2,845 2,018 827 Proceeds on Disposal of Fixed Assets

426,026 410,334 15,692

COST OF SALES 34,113 24,086 10,027 Increased External Services Sales Activities

GROSS OPERATING SURPLUS 391,913 386,248 5,665

EXPENDITURE
Employee Related Costs - Wages & Salaries 273,038 271,228 1,810 Payroll Prior Year Adjustments
Contracted Services 43,500 40,894 2,606 Fleet Increased Premium and Fuel Prices
Consulting Fees 1,079 804 275 Increased Activities
General Expenses - Other 74,995 71,952 3,043 Increased Tree Planting Acitivities
Repairs and Maintenance 17,050 14,729 2,321 Increased Activity
Depreciation and Amortisation 5,784 6,129 ( 345) FV of Assets
-
OPERATING SURPLUS/(DEFICIT) BEFORE INTEREST ( 23,533) ( 19,488) ( 4,045)
-
Net Investment Income 19,407 19,488 ( 81) Interest FV and Interest Paid
-
NET (DEFICIT)/SURPLUS ( 4,126) - ( 4,126)

142
 CHAPTER SIX: FUNCTIONAL AREA SERVICE DELIVERY REPORT

The table following this page provides information on the functional area provided by
Johannesburg City Parks incorporated as a section 21 Company to maintain and
develop parks, cemeteries and conservation areas.

Function: Community and Social Services

Sub Function: Johannesburg City Parks
Reporting Level Detail Total
Johannesburg City Parks (JCP) is the greening, conservation and cemetery
Overview:
management agency for the City of Johannesburg (CoJ).)
JCP is a Section 21 (non-profit)
Description of the Company that manages and
Activity: maintains the parks, open
spaces, environmental services
and cemeteries for and on
behalf of the CoJ.
These services extend to include
Municipal parks, -
environmental, conservation and
cemetery services and exclude
similar services on Provincial
and National government levels.
The strategic objectives of this
function are: Service delivery;
Customer satisfaction and
responsiveness; Occupational
Health, Safety and Security;
Economic development and Job
creation; HIV and AIDS; Safe
Clean and Green City; Effective
Financial Management
The Key issues for 2007/8:
- Security requirements have
increased
- New Capex developments
without Opex funding for
the maintenance thereof
- Greening of Soweto,
address the tree planting
backlog
- HIV and AIDS
Analysis of the Statistical information of JCP Number of facilities: Number of
Function: Nature and extent of facilities users:
provided:

143
Function: Community and Social Services
Sub Function: Johannesburg City Parks
Parks, cemeteries, nature Parks and arterials: 2328 The
conservation areas, public open communities
space Area of developed parks and residents
and arterials: within the
6 587.5 hectares boundaries of
the City of
Area of undeveloped Johannesburg
parks: 3 576.5 hectares

Nature Reserves:
1 569 hectares

Street verges:
5 500 hectares

Area of cemeteries:
904 hectares

Water Surfaces:
174 hectares

Street Trees:
1,3 to 1,6 million

Cemeteries: 35

Crematoria: 2

Nurseries: 2

Bird Sanctuaries:
24,6 hectares

Trails and River Trails:

107 km

Environmental and
Educational Centres: 6

Size of fleet:
Vehicles: 321
Trailers: 136

Note: the facilities figure should agree with the assets register

Number and cost to employer of 1 799 R 273 038 000

personnel associated with JCP:
Total operating cost of R 448 132 000
community and social services (the
function assumption is
that all
expenditure is

144
 Function: Community and Social Services
Sub Function: Johannesburg City Parks
community and
social)
Performance During the Year,
Performance Targets Against
Actual Target
Actual Achieved and Plans to
Improve Performance
Key Performance Area

Service Delivery

Maintenance cycles:
Number of maintenance cycles (days) undertaken in Parks per category:
14 Flagship Target achieved 7 Days Average 7 Days Average
Parks’ (main
parks)
Maintenance
Developed Target achieved 21 Days Average 21Days Average
Parks’
maintenance

Undeveloped Target achieved 60 Days Average 60 Days

Parks’ Average
maintenance

Sidewalks’ Target exceeded 100 Days 120 Days

maintenance Average Average
Road Road Islands’ Target exceeded 40 Days 60 Days
Average Average

% Compliance Target achieved 90% 90%

with
Environmental
Management
System
Number of new Target achieved 3 3
developments
in Parks

145
Function: Community and Social Services
Sub Function: Johannesburg City Parks Actual Target
Number of Target exceeded 4 3
developments
in Cemeteries
Number of Target exceeded 49 245 10 000
mature
indigenous
trees planted
(>2 meters
high)
Customer satisfaction
% Increase in
customer
Target exceeded 78% 70%
satisfaction
index
Expanded Public Works Programme (EPWP)
Number of Target exceeded 1 133 350
jobs created,
disregarding
duration
(EPWP)
Key programmes planned for the
2008/9 Integrated Development Plan:
(a) New developments in Parks

(b) Park refurbishments

(c) Planting of 62 000 trees

(d) Greening of the City (primarily previously
disadvantaged areas (the South));
(e) Education of the workforce on HIV/AIDS
to counteract the impact thereof.
(f) Job creation through Expanded Public
Works Programme
(g )Kliprivier/Klipspruit Corridor Legacy
Project

146