SARCC

1
SARCC Portfolio Committee on Transport Budget
Presentation 18 MARCH 2005
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Presentation Outline

• Introduction Eddie Lekota - CEO
• SARCC Overview
• Business Focus
• Finance
• Budgets
• Conclusion

3
Business Focus

• Service
• Rolling Stock
• Safety Security
• Focused Projects
• Service Extension
• Funding

4
CAPEX Allocation
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                          Table 1
 
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2003/4 AUDIT REPORT

Property Plant and Equipment
Rolling Stock Classification
AUDIT QUALIFICATION
Impairment
Depreciation
7
PROGRESS TO DATE
Investment
Materiality Framework
Capitalisation and Maintenance
1. POLICIES IN PLACE
Research and Development
PPE Accounting Policy
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COMPLIANCE TO GAAP - PPE

•  
• Items of Assets (PPE) not carried at fair value,
  retrospective application of AC123 (revised) will
  be conducted.
• A detailed analysis of ensuring that our fixed
  asset system has all the functionalities to
  calculate all the requirements of AC123 is
  underway.
• All assets are to be split into components. A
  guideline is being prepared for the
  identification of minimum components.
• 4. The Residual values and useful lives will be
  evaluated every year.
• SARCCs Group Policy and Procedure Manual will be
  updated regularly to comply with the
  requirements.
• Annual Report 2004/5
• Qualification

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2003-2005 Budget
Allocations
R'million
R'million
R'million
Actual
Actual
Budget
2002/2003
2003/2004
2004/2005
A
OPERATIONAL SUBSIDY
Income
1,847
2,034
2,172
Subsidy
1,679
1,874
1,546
Rental of assets
60
60
60
184
Property Development
214
238
57

Net interest
81
2,021
B
Less Expenditure
1,806
2,172
Commuter services
1,216
1,291
1,414
Asset rental/Spoornet station
maintenance
48
47
48
Heavy repairs/Operational
185
282
216
Property expenses
189
200
247
111
Insurance
144
158
Head Office other
57
57
89
Operational Subsidy
Surplus
(A-B)
41
13
0
CAPITAL SUBSIDY
Capital
555
565
555
Rolling Stock
100
100
100
Additional Capital
663
665
655
10
2006 2008 Budget Allocation
R'million
R'million
R'million
Budget
Budget
Budget
2005/2006
2006/2007
2007/2008
A
OPERATIONAL SUBSIDY
Income
2,069
2,194
2,310
Subsidy
1,780
1,887
1,982
Rental of assets
60
60
60
Property Development
229
247
268
B
Less Expenditure
2,264
2,399
2,525
Commuter services
1,484
1,574
1,656
Asset rental/Spoornet station
maintenance
48
48
48
Heavy repairs/Operational
227
238
250
Property expenses
246
265
284
Insurance
164
171
178
Head Office other
95
100
106
Khayelitsha extension operational
requirements
3
3
Operational Subsidy
(shortfall)/surplus
(195)
(205)
(215)
(A-B)
CAPITAL SUBSIDY
Capital
588
630
666
Rolling Stock
100
100
100
Additional Capital
100
250
688
830
1,016
VAT
(85)
(102)
(125)
603
728
891
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Subsidy Allocation
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CONCLUSION

• Budget Vs Strategy
• Implications of the Consolidation