ANNEXURE 9
DRAFT GRANTS POLICY
2013/2014
Document Information and Revision Log
File Name
Draft Grants Policy
Original Author (s) CoCT
George van Schalkwyk
Current Revision Author (s)
George van Schalkwyk
Next Review Date
19 April 2013 (Officials)
3 May 2013 (Finance Portfolio Committee)
Version
Date
Authors
Revision Notes
1
25 January 2013
1 Finance Portfolio Committee Workshop on
Budget Related policies (Kristo Pienaar
Centre)
Draft
2
8 February 2013
ISL Workshop with Subcouncil Managers and
other Officials (Parow Civic)
Draft 2
3
1 March 2013
2 Finance Portfolio Committee Workshop on
Budget Related policies (Parow Council
Chamber)
st
nd
Draft 3
Approval of Policy
Please note that the implementation of the policy contained in this document is subject to approval
and signing off by all relevant Heads and/or Committees, including but not limited to:




Executive Director : Finance
Portfolio Committee : Finance
MAYCO
Council
1
CITY of CAPE TOWN
GRANTS POLICY
CONTENTS
PAGE
Preamble
Definitions
Abbreviations and Acronyms
INDEX
1.
2
3
3.1
3.2
3.3
3.4
4.
5.
6.
7.
7.1
7.2
8.
8.1
8.2
9.
10.
Introduction
Purpose
Statutory provisions and compliance
Approved budget for Grants
Procedural and regulatory oversight Grants
Committee
Constitutional Powers and Functions
VAT and SCM
Organisations or bodies making application for Grants – Qualifying
criteria and those organisations who may be considered for grant
funding
Projects and expenditure that cannot be funded by means of a Grant in
terms of this Policy
Other requirements
Processing of applications and Grant approvals –
Administrative, regulatory and approval processes
Sub-council Grants
Line Department Grants
Processing of Grant payments
Sub-council Grants
Line Department Grants
Utilisation of Grants – Control, monitoring and reporting –
Sub-councils and Line Departments
Status Reports, Audits and the City’s Annual Financial
Statements
2
10.1 Reports to the Grants Committee
10.2 Reports to Council, Portfolio Committees and Subcouncils confirmation of outcomes
10.3 Internal Audit department
10.4 Auditor General’s office
10.5 Grants Footnote to Statement of Financial
Position of the City’s Annual Financial Statements
11. Budget and Accounting requirements
12. Funding Acknowledgement and Intellectual Property Rights
of the City
ANNEXURES
“A1” Grants Application form
“A2” – Business and Project Plan
“A3” – Expenditure Report
“B” Memorandum of Agreement
“C1” Project Qualifying Criteria in terms of Constitutional
Competencies and
any additional powers and functions assigned in terms of
relevant legislation
“C2” Section 156 and Schedules 4 and 5 Parts B of the
Constitution
“C3” Social Developmental and Early Childhood Developmental
Programmes Implementation Protocol
Commencement date – 1 December 2012
Termination Date:
(a) six (6) months from the date on which a newly elected Council
has approved the new Integrated Development Plan for the City or;
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(b)the commencement date of a new Implementation Protocol,
which ever shall come first.
“C4” Implementation of Projects and Initiatives in Support of the City’s
Arts and Culture Programmes – Implementation Protocol
Commencement Date 7 November 2012 and Termination Date:
(a) This Protocol commences on the commencement date and will
remain in effect for a period of 3 years.
“D”
Responsibilities, Mandates and Terms of Reference of
various officials and Grants Committee.
“E”
Documentation required by Expenditure Department
(Accounts Payable)
“F”
Template - Section 67(4)(b)(ii) certificate for
Auditor-General
“G”
Template Approval Process (TAP)
“H”
Template Self-Regulatory Process
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PREAMBLE
The City of Cape Town (the City), apart from entering into commercial and
other business transactions or specific delivery agreements with organisations
or bodies outside any sphere of government to deliver goods and services
within its area of jurisdiction, also makes grants to such organisations or bodies
to fund projects that benefit the community and, in partnership with the City,
also utilise these grants to carry out projects that assist the City in realising its
goals and objectives as set out in its IDP and strategies to be an opportunity, a
safe, a caring, an inclusive and a well-run City.
The projects and/or programmes supported by these grants assist the City in: Addressing the social developmental and early childhood developmental
needs of communities as set out in the Social Development and Early
Childhood Developmental Implementation Protocol (Annexure “C3”);
 Building and growing arts and culture within communities and involving
youth in Arts and Culture programmes as set out in the Arts and Culture
Implementation Protocol (Annexure “C4”);
 Promoting sports and recreation and the utilisation of local sports
facilities;
 Ensuring the safety of the public when using the City’s beaches by
supporting lifesaving clubs affiliated to Western Province Lifesaving;
 Fighting crime to ensure the safety and security of its citizens by
supporting the establishment of neighbourhood watch services within
communities; and,
 Pursuing its mandates and responsibilities relating to existing health
situations in terms of the Health Act.
The funds for such grants are provided on the City’s approved budget in terms
of the Local Government: Municipal Finance Management Act, 56 of 2003
(MFMA) and in compliance with the provisions of the Constitution of the
Republic of South Africa, Act 108 of 1996 (the Constitution) and other relevant
5
legislation. This Legislation, together with the need to ensure good
governance, follow proper accounting practice and procedures and comply
with National Treasury Regulations, prescribes the need to establish and
implement an effective regulatory and procedural framework in order to
ensure that the grants are not approved, processed and utilised in an irregular,
fruitless and wasteful or unauthorised manner.
The Grants Policy (“the/this Policy”) was drafted in order to ensure that all
grants allocated in terms of this Policy are properly regulated, approved,
processed and monitored, the application of sound financial management and
internal control and the principles associated with good corporate governance.
DEFINITIONS
In this Policy unless the context indicates otherwise –
“Accounting Officer” -
means the municipal official referred to in
section 60 of the Local Government: Municipal
Finance Management Act, 56 of 2003 (MFMA)
and includes a person acting as the accounting
officer;
“accounts payable” -
means a division within the Expenditure
Department of the Finance Directorate that
processes all payments to outside
organisations who either deliver goods and
services to or receive grants from the City;
“approved budget”
means the City’s annual budget approved by
the Council in terms of Section 24 of the MFMA
and includes such an annual budget as revised
by an adjustments budget in terms of Section
28 of the MFMA for each particular financial
year;
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“Budget Department”
means the department in the City’s Finance
Directorate responsible for the compilation,
management and administration of the City’s
budget and is an office established in terms of
Section 80 (1) of the MFMA;
“chief financial officer” (“CFO”) means a person designated in terms of section
80(2)(a) of the MFMA;
“City Secretariat”
means the secretariat responsible for the
administrative functions of official Council
meetings;
“Commercial or other business transactions”
means a contract or transaction entered into
between the City and an outside contractor or
vendor in terms of the City’s SCM Policy and
Procedures for the supply of goods and/or
services by the contractor or vendor;
“community”
means the residents of the City;
“disclosure and declaration of interests - Councillors”
means disclosures and declarations by
Councillors as required in terms of Sections 5
and 7 of Schedule 1 – (Code of Conduct for
Councillors) of the Local Government:
Municipal Systems Act, 32 of 2000 (MSA);
“Disclosure of benefits and declaration of interests – municipal staff members”
means disclosure of benefits and declaration of
interests by municipal staff members as
required in terms Sections 5 and 5A of
Schedule 2 of the Municipal Systems Act, Act
32 of 2000 – Code of Conduct for Municipal
Staff Members
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“Directorate”
means one of the City’s directorates so
designated – within the official organogram
and which is managed by an official appointed
in terms of Section 57 of the Local
Government: Municipal Systems Act, 32 of
2000 (MSA).
“Early Childhood Development (ECD) Facility”
means any place, building or premises,
including a private residence, maintained or
used partly or exclusively, whether for profit or
otherwise, for the reception, protection and
temporary or partial care of more than six
children that shall be registered with the WCG
and be managed and maintained in terms of
the Children’s Amendment Act, 41 of 2007;
“Expenditure Department” -
means the department in the City’s Finance
Directorate responsible for the processing of all
payments and administration of all expenditure
in the City;
“Finance Directorate”
means the directorate of the City controlled
and managed by the CFO;
“finance manager”
means the official in a Directorate or Line
Department who is responsible for the financial
management and administration of his/her
directorate or department ;
“grant”
means a grant or allocation, as referred to in
Section 17 (3)(j)(iv) of the MFMA, by the City to
any organisation or body referred to in Section
67(1) and to be utilised to assist the City in
fulfilling the Constitutional mandates including
social developmental and arts and culture
programmes as set out in the respective
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Implementation Protocol agreements with the
WCG (Annexures “C3” and “C4” refer) and as
set out in Annexure “C1” of this Policy;
“Implementation Protocol”
means an agreement entered into between
different organs of state in order to co-ordinate
their actions in an appropriate manner and
thereby creates the necessary capacity to
ensure effective service delivery in respect of a
statutory function;
“Line Department” -
means a department so designated within the
City’s official organogram;
“memorandum of agreement” (“MOA”)
means the agreement entered into between
the City and any organisation or body which
receives a grant in terms of this Policy;
“municipal account” -
means the municipal services account
rendered by the City in respect of property
rates, service and user charges for services
rendered ;
“National Treasury”
means a directorate of national government
which manages the national economic policy,
prepares the government’s annual budget and
manages the government’s finances in the
Finance Ministry;
“Non-governmental Organisations”
Means non-governmental organisations (NGO)
that are legally constituted organisations
created by national or legal people that
operate independently from any form of
government;
9
“Non-profit Organisation”
means non-profit Organisations (NPO)
registered in terms of Section 13 of the NPO
Act, 71 of 1997, as provided for under Chapter
11 (Goods and Services) and the Municipal
Supply Chain Management regulations of the
MFMA;“other relevant policies”
means
other policies approved by the City and which
contain provisions that may impact on the
application of this Policy or are directly or
indirectly linked;
“project and/or programme”
means, in the context of this Policy, a
compliant and qualifying programme,
enterprise, undertaking or activity that is
focussed on achieving outcomes that benefit
the City and its residents within the City’s area
of jurisdiction;
“project manager”
means the official in a Line Department who is
responsible for the management;
administration, control, monitoring and
reporting on projects or programmes funded
by means of a grant allocated in terms of this
Policy;
“Secretariat”
means the secretariat of the Grants Committee
who is responsible for all the administrative
functions relating to the Grants Committee;
“section 67”
means transfers of funds made in compliance
with section 67 of the MFMA to an
organisation or body outside any sphere of
government otherwise than in compliance with
a commercial or other business transaction;
“Grants Committee”
means the committee established in terms of
clause 3.2.2 of this Policy;
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“Grants Division”
means a division of the Inter-Service Liaison
Department of the Finance Directorate;
“specific delivery agreement” means an agreement entered into between the
City and a service provider to deliver goods and
services of a specialised and unique nature
and/or require specific expertise and special
skills to produce, install and/or provide;
“sports equipment”
means any gear, apparatus and clothing
required in order to participate in sporting and
recreational activities and encourage the
utilisation of local sports facilities;
“sub-council”
means one of the 24 metropolitan sub-councils
as established in terms of section 62 of the
Municipal Structures Act, 5 of 2000;
“sub-council manager” -
means the senior official appointed to manage
a sub-council’s administration and is the
project manager in respect of grant funds
allocated by his/her sub-council in terms of this
Policy;
“the City”
means the City of Cape Town;
“the/this Policy”
means the Grants
“Treasury Department”
means a department within the City’s Finance
Directorate that is responsible for all its
treasury and accounting functions and
responsibilities and is an office established in
terms of Section 80(1) of the MFMA;
“VAT section”
means a section of the Treasury Department of
the Finance Directorate which is responsible
for the administration of all VAT matters.
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Policy;
ABBREVIATIONS AND ACRONYMS
AO
The Accounting Officer or his/her nominee. The municipal
manager of a municipality is the accounting officer of the
municipality
CBO
Community Based Organisation
CFO
Chief Financial Officer or his/her nominee
FSP
First Screening Process
IDP
Integrated Development Plan
MFMA
Local Government: Municipal Finance Management Act, 56 of
2003
MOA
Memorandum of Agreement
MPRA
Municipal Property Rates Act, 6 of 2004
MSA
Local Government: Municipal Systems Act, 32 of 2000
NGO
Non-Governmental Organisation
NPO
Non-profit Organisation
SCM
Supply Chain Management
SLA
Service Level Agreement
SSP
Second Screening Process
TAP
Template Approval Process
WCG
Western Cape Government
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13
THE GRANTS POLICY
1. Introduction
1.1
Grants in terms of this Policy, are allocations of funds, from the City’s
approved budget, to organisations or bodies outside any sphere of
government. These allocations are gratuitous or unrequited transfers
by the City to the grantee organisations and are not payments made
in compliance with any commercial or other business transaction or
other transfers, or grants, made in terms of other policies of the City.
2. Purpose
2.1
These grants provide organisations or bodies with funds for carrying
out projects and/or programmes which assist the City in exercising
certain of its legislative obligations and Constitutional mandates.
Grants, in terms of this Policy, are, similarly, made to organisations
or bodies in terms of Implementation Protocol Agreements (Refer
Annexures “C3” and “C4”) entered into between the provincial
government of the Western Cape and the City.
2.2
These grants are also aimed at funding projects and/or programmes
that complement the strategic goals or focus areas (the 5 pillars) and
objectives of the IDP of the City in order to create a sustainable,
credible and caring City by establishing partnerships and enabling
environments to empower and build communities, promote social
and early childhood development and arts and culture and enhance
growth, create job opportunities and promote safety and security for
all.
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3.
Statutory provisions and compliance
3.1
Approved budget for Grants allocated in terms of this
Policy
3.1.1 Section 16(2) of the MFMA provides that a mayor of a municipality
must table the annual budget at a Council meeting at least 90 days
before the start of a budget year. Section 17(3)(j)(iv) provides that
when an annual budget is tabled in terms of section 16(2) it must
include particulars of any proposed allocations or grants to any
organisation or body referred to in section 67. National Treasury
Circular number 51 dated 19 February 2010 confirms that any
allocations or grants made to organisations or bodies that are not
reflected in a municipality’s budget or adjustment budget must be
regarded as unauthorised expenditure because they are grants by the
City otherwise than in accordance with the provisions of Section
17(3)(j).
3.1.2 The tabling of the annual budget is followed by a public participation
process inviting input and/or comment on the tabled budget before
the budget is approved by Council in terms of Section 24 of the
MFMA.
3.2
Procedural and regulatory oversight and
Committee
the Grants
3.2.1 Section 67 of the MFMA requires the City to implement and sustain
proper and effective controls and procedures when transferring
funds of the City to an organisation or body outside any sphere of
government. Compliance with the regulatory and control measures
as set out in Section 67(1) must be enforced by the AO through
contractual and other appropriate measures in terms of Section
67(3).
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3.2.2 This regulatory process will receive oversight from a Grants
Committee (“the Committee”). The members of the Committee shall
be officials of the City appointed by the CFO. The Committee will
have broad representation by including officials from various
functional areas in the City as members and will be chaired by the
CFO or his/her nominee. This policy, and its associated procedures,
are aligned to the annual budget process, GRAP accounting
standards, VAT legislation and administration, financial and internal
control requirements of the Treasury Department and the SCM
processes as administered by the SCM Department through its
application of the SCM Policy and procedures and the municipal SCM
regulations in the MFMA.
3.2.2.1
The Committee will administer, co-ordinate and control the
Second Screening Process (SSP) in respect of applications
recommended by line departments and subcouncils. The
Committee must ensure that each of the recommended
grants complies with all the provisions contained in this
Policy, the Constitution and relevant legislation,
Implementation Protocol Agreement and other policies of
the City where applicable. The Committee is mandated to
either support or not support a recommendation received
from a subcouncil or a line department dependent upon the
outcome of its assessment of the grant proposal or
recommendation.
3.2.2.2 The Committee must be satisfied that the business and
project plan were properly scrutinised and verified for
completeness, compliancy and accuracy at the FSP to
ensure that the organisation or body making application for
a grant has the capacity and has agreed to comply with the
requirements of section 67(1)(a) of the MFMA or, in the
case of an organisation or body which receives a grant that
does not exceed the prescribed limit (currently R25 000) set
in terms of section 67(4), is satisfied that the organisation
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or body has the capacity and has agreed to comply with the
requirements and controls of this Policy. The Committee
must also confirm that the project and subcouncil managers
shall ensure compliance with section 67(4)(b) as set out
under paragraphs 8.1.1.4, 8.2.1.4 and 9.2 of this Policy.
3.2.2.3 The Committee must also ensure compliance with section
67(1)(b) and take note of where an organisation failed to
comply with the requirements of section 67(1) of the MFMA
in respect of a previous transfer in which case a further
transfer, as per section 67(1)(c), may be made to that
organisation and provided that the requirements of section
67(2) are complied with.
3.2.3 Self-regulatory Process:The self-regulatory process (SRP) may be used by a line department
to submit grant proposals to the Committee for consideration at the
SSP before submission of grant reports to the relevant Portfolio
Committee and Council for approval.
The Finance and Project Managers of the relevant line department
are required to complete and sign off the standard section 67 Grants
SRP template (Annexure”H”) for submission to and consideration by
the Committee at the SSP. The completed and signed template
confirms to the Grants Committee that: the Line Department and relevant Councillors have met with
the beneficiary organisation to discuss the proposed project(s)
at a FSP in order to achieve mutual understanding in respect of
the requirements of this Policy;
 the line department has appropriate regulatory, monitoring,
reporting, and administrative procedures in place to ensure
effective accountability; and,
 accurate records will be kept to confirm proper and authorised
utilisation of the City’s funds by the beneficiary organisation in
terms of the MOA.
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3.2.3.1 The utilisation of this specific process, aligned to the
regulatory processes in this Policy, does not, however,
relieve the Line Department from complying with the
requirements of paragraphs 9, 10.1 and 10.2 of this Policy,
any legal and statutory determinations by the Legal Services
Department, the City’s SCM Policy and procedures as
applied by the SCM Department and the relevant provisions
as contained in the VAT Act, 89 of 1991 (“the VAT Act”), as
interpreted and applied by the VAT Section.
3.2.3.2 This process only applies where grants are allocated in
terms of this Policy. It therefore does not apply to any
allocation of funds for projects and expenditure listed as
exclusions under paragraphs 5.1 and 5.2 of this Policy.
These either represent projects or expenditure that, will not
qualify for grant funding under this Policy, or, are
administered and regulated in terms of other specific
policies and procedures that shall at least include similar
monitoring requirements, controls and reports as reflected
under paragraphs 9 and 10.2 of this Policy. Apart from
consultation with the Legal Services Department in terms of
legal compliance, the VAT Section and the SCM Department
shall be consulted before allocations processed in terms of
the SRP are submitted to the relevant Portfolio Committees
and to Council for consideration in order to ensure that the
relevant empowering legislation and/or policies and
procedures are being complied with.
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3.3
Constitutional powers and functions and Implementation
Protocols
3.3.1
In terms of section 156 of the Constitution, the City has
executive authority in respect of and the right to administer
the local government matters as listed in parts B of
schedules 4 and 5 (Annexure “C2” refers) and any other
matter assigned to it by national or provincial legislation.
Annexure “C1” reflects the project qualifying
criteria utilised to assess compliance with these
requirements and provisions.
3.3.2
Social Development and Early Childhood Developmental
Implementation Protocol (Annexure “C3”)
This is an agreement entered into between the Provincial
government of the Western Cape and the City in order for
the City to address the social developmental needs of
communities.
3.3.3
Arts and Culture Implementation Protocol (Annexure “C4”)
This is an agreement entered into between the Provincial
government of the Western Cape and the City in order for
the City to build and grow arts and culture within
communities and involving youth in Arts and Culture
Programmes.
3.4
VAT and SCM
3.4.1
In determining that the payment is in terms of this policy,
such payment will, in terms of the VAT Act, be deemed zero
rated if it’s made to a registered Welfare Organisation as
defined in sections 30(1) and 30(3) of the Income Tax Act,
58 of 1962 (“the Income Tax Act”). Payments made to other
organisations/bodies that are VAT vendors can also be
deemed a zero rated grant, provided that the grant paid to
or on behalf of that vendor is in the course or furtherance of
19
an enterprise carried on by that vendor. All other payments
to non-VAT vendors will not be seen as a grant in terms of
the VAT Act but a transfer payment made in compliance
with Section 67. All VAT and non-VAT vendors must be
registered on the City’s SAP Vendor Data Base which forms
part of the SCM process.
3.4.2
The appointment of outside contractors to perform
functions and deliver goods and services that are normally
performed and delivered by the City’s line departments
should be undertaken by the line departments utilising
funds provided for such functions or for the delivery of
goods and services on their approved operating budgets.
Line departments also utilise funds allocated and
transferred by the various subcouncils, from their ward
allocations, to the relevant line departments to appoint
contractors to perform such functions and deliver goods and
services. All appointments of contractors shall be made in
terms of the City’s SCM Policy and procedures as applied
and interpreted by the SCM Department and such
appointments shall be regulated and managed as
commercial or business transactions. Grants allocated in
terms of this Policy may not be utilised to fund such
expenditure.
Line Departments may, apart from appointing contractors in
terms of the SCM Policy, also utilise Specific Delivery
Agreements entered into with certain service providers to
carry out projects for the delivery of goods and services. Such
projects or deliverables are funded directly by the respective
departments utilising their approved budget and not by means
of grants allocated in terms of this Policy. The goods and
services provided should be of such a nature that they can
only be effectively delivered by a specialist organisation. Line
Departments utilising this delivery model shall be identified
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under paragraph 5.2 below confirming that these transfers of
funds are not Grants allocated in terms of this Policy. These
departments should draft appropriate and specific policies
and procedures that make provision for an effective regulatory
and administrative framework in order to ensure compliance
with all relevant legislation, including the requirements of
section 67 of the MFMA, and applicable Council policies. These
specific policies should however, at least, include similar
monitoring requirements, controls and reports as reflected
under paragraphs 9 and 10.2 of this Policy.
4 Organisations or bodies making application for grants in
terms of this Policy – specific qualifying criteria.
Applicants, who apply for grants in terms of this Policy in
order to carry out projects and/or programmes that meet
the project qualifying criteria as set out in Annexures “C1”
and “C2”,
which includes programmes identified in
Annexures “C3 and C4” in terms of the Implementation
Protocol agreements with provincial government of the
Western Cape, , shall either be one or more of the following:
4.1
a registered welfare organisation being a public benefit
organisation as contemplated in the definition of public
benefit organisations in sections 30(1) and 30(3) of the
Income Tax Act; or,
4.2
a NPO registered as such in terms of section 13 of the NonProfit Organisations Act, 71 of 1997; or,
4.3
a company incorporated in terms of section 21 of the
Companies Act, 71 of 2008, or a Non Profit Company
as defined in that Act; or,
4.4
an ECD site or child care and development facility such as a
crèche, day care or educare centre that is duly registered
with the Department of Social Services of the WCG as a
21
place of care in terms of the Children’s Amendment Act, 41
of 2007; or,
4.5
an old age home registered with the Department of Social
Services: Western Cape in terms of the Older Persons Act,
13 of 2006 provided the grant is to be used for the
promotion of sport and utilisation of sports facilities, or
where the old age home utilises the grant to provide a
service to the community in respect of poverty alleviation
projects ; or,
4.6
any religious institution or body of a public character; or,
4.7
any school, where grants may only be allocated and used
to provide and/or maintain their own sports facilities
and/or acquire sports equipment in order to promote
access to sporting activities and the utilisation of such sports
facilities thereby assisting the City in pursuing its broader
developmental and municipal health mandates in respect of
the youth; or,
4.8
any amateur sports club, association or group which
actively promotes the utilisation and provision of sport
facilities, and the repairs and maintenance thereof and/or
provides sports equipment thereby assisting the City in
pursuing its broader mandates in terms of promoting
community and municipal health provided that membership
of such an organisation is not exclusive; or,
4.9
life saving clubs affiliated with Western Province Life Saving
and who assist the City in its endeavours to ensure the
safety of the public when using the City’s beaches.
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5.
Projects, programmes and expenditure that cannot be funded
by means of a grant allocated in terms of this Policy
5.1
The following, being either, projects, activities,
programmes or types of expenditure, will not qualify for
grant funding in terms of this Policy:-
5.1.1
bursaries of any kind; or,
5.1.2
disaster management and relief; or,
5.1.3
donation of assets, moveable or immovable; or,
5.1.4
public functions , conferences and seminars of any kind; or,
5.1.5
rewards and awards; or,
5.1.6
sponsorships, of any kind, as defined in and regulated by
other policies of the City; or,
5.1.7
luncheons, dinners, parties and functions of any
kind; or,
5.1.8
festivals and markets of any kind; or,
5.1.9
if not aligned to the priorities, strategies and
objectives as set out in the City’s IDP; or,
5.1.10
retrospective funding of expenditure that has already been
incurred or to fund any over expenditure that may be
incurred on an approved grant project; or,
5.1.11
where only an individual will benefit; or,
5.1.12
which are to be carried out beyond the City’s area
of jurisdiction unless a clear and compelling benefit to the
City and its residents can be demonstrated; or,
5.1.13
for the benefit of any particular political party, organisation,
group grouping or affiliation; or,
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5.1.14
subsidisation or funding of municipal rates, tariffs, service or
user charges; or,
5.1.15
the funding of any expenditure relating to or associated with
the operation of special rating areas established in terms of
the MPRA; or,
5.1.16
funding any organisation’s or body’s normal operational
expenditure including employee costs or any expenditure
required to establish an organisation or to make it viable; or,
5.1.17
any commercial or other business transactions entered into
between the City and outside contractors or suppliers, in
terms of the City’s SCM Policy for the supply of goods or
services; or,
5.1.18
any undertaking or enterprise operating as a business for
profit or gain except in the case of an ECD site or child care
facility referred to in paragraph 4.5 above; or,
5.1.19
grants to civic or ratepayers associations.
5.2
This Policy does also not apply to the following which are
either processed and regulated in terms of other polices of
the City or are administered and regulated in terms of
other empowering legislation, are considered to be
commercial or business transactions, or are transfers
made in terms of Specific Delivery Agreements referred to
in paragraph 3.4.2.1 as utilised by certain Line
Departments:-
5.2.1
housing billing subsidies; or,
5.2.2
housing development subsidies; or,
5.2.3
indigent grants and rates rebates; or,
5.2.4
inter-governmental grants; or,
5.2.5
grants to other municipalities; or,
24
5.2.6
grants to other organs of state; or,
5.2.7
grants to municipal entities; or,
5.2.8
allocations by the Sports and Recreation Department, in
terms of special delivery agreements to fund municipal
delivery partnerships utilised to regulate the funding of
“caretaker allocations”, municipal facility management
committees and district sports councils and annual
allocations to the Western Province Life Saving Association.
The provisions for these allocations are made on the
approved operating budget of that department under the
relevant GL accounts and not 457100; or,
5.2.9
allocations in terms of environmental or heritage
management and/or conservation special delivery
agreements entered into by the Environmental Resource
Management Department with other organs of state and
non-governmental organisations which are registered NPO’s
or section 21 companies. The provisions for these
allocations are made on the approved operating budget of
that department under the relevant GL accounts and not
457100; or,
5.2.10
provision of capital infrastructure and the erection of
buildings or the extension of or alterations to buildings on
property either belonging to the City or property belonging
to the organisation or body making application for a grant in
terms of this Policy or to property being leased by such
organisation and body from another party; or,
5.2.11
repairs and maintenance to Council owned facilities,
buildings or properties utilised by organisations either in
terms of a lease agreement with the City, or hired at the
applicable tariff in terms of its tariff policies; or,
25
6.
5.2.12
funds established and operated by the City in terms of
section 12 of the MFMA; or,
5.2.13
events of any kind, including the marketing thereof, which
include sporting and cultural events, concerts, shows
and/or exhibitions and “indabas”; or,
5.2.14
the promotion of tourism or destination marketing; or,
5.2.15
the promotion of economic development including creating
of an enabling environment for such development.
Other requirements
6.1
Applications for grant funding in terms of this Policy shall
only be considered where organisations or bodies have
responded to advertisements published in the local press.
All grant applications received in response to the
advertisement must be processed and be submitted to
Council for consideration. The need to process grant
applications in an organised and timeous manner is dictated
by the provisions of section 17(3)(j)(iv) of the MFMA which
section provides that the annual budget tabled at Council at
least 90 days before the start of the budget year (section
16(2)) must be accompanied by particulars of any proposed
allocations or grants by the City to any organisations or
bodies referred to in section 67. The City may however
consider grant applications during a financial year, as and
when these are received, and such applications shall also be
processed in terms of this Policy. Such requests, being
exceptions to the norm, shall be processed as adjustments
to the approved operating budget as regulated by section
28 of the MFMA and as provided for under paragraph 3.1.1
above. Any adjustments to the approved budget must be
contained within the total approved budget for ward
allocations (operating) in the case of sub-councils and the
26
total approved budget (operating) for each department in
the case of a line department.
6.1.1.
All applications must be submitted by organisations or
bodies using the standardised application form and business
and project plan (Annexure ”A” and Appendix “A”). All
applications and business and project plans must be fully
and properly completed. No late applications received in
response to an advertisement by either the sub-council
manager or project manager after the advertised closing
date, may be considered and processed.
6.1.2
The organisation must also be up to date with its municipal
account(s), where applicable, by either settling any arrears
or amounts outstanding in full or making the necessary
payment arrangements, as agreed with and applied by the
City’s Revenue Department, in terms of the City’s Credit
Control and Debt Collection Policy before an application/or
a grant can be fully processed.
6.1.3
The organisation must also be up to date with any lease
rental and services charges where it is leasing property from
the City before a grant shall be processed. No grant funds
shall be allocated to any organisation if, apart from the need
to comply with this Policy, it is precluded from carrying out
the particular project, for which it requires grants, on the
property leased from the City in terms of the lease
agreement.
6.1.4
The owner of a property that is leased to an organisation
applying for a grant must be up to date with his/her
municipal account before the grant can be processed. The
organisation should also ascertain from the City that it may,
in terms of other relevant legislation and policies, utilise the
property for the purpose for which it requires the grant. The
lease agreement with the lessor must also be taken into
account in order to ensure the City’s funds are not paid over
27
at risk should the lease agreement in any way serve to
curtail an organisation’s ability to perform specifically as
stipulated in the MOA entered into with the City when
accessing the grant.
6.2
A grant shall only be paid over to an organisation after all of
the above has been complied with, the Council has
approved the grant and the MOA has been signed.
6.2.1
Approved grants may be paid over as a single payment or in
tranches as determined or required dependent upon the
nature and/or progress of the project. The disbursement of
the grant, by way of progress payments, must be arranged,
in advance, with the Expenditure Department (Accounts
Payable), by the sub-council or project manager. The full
amount of the approved grant must be disbursed in the
financial year that co-incides with the relevant approved
budgets.
6.2.2
Unexpended grant funds, as reflected on the operating
budgets of subcouncils and line departments, in any
financial year, may not be carried over into any ensuing
financial year.
6.2.3
All organisations or bodies making application for grants
must register as vendors on the City’s SAP Vendor Data Base
in terms of the City’s SCM policy and procedures. Such SCM
vendor registration process includes the submission of an
original and up to date tax clearance certificate issued by
SARS. A vendor who is registered for VAT purposes must
also submit a zero rated VAT invoice when applying for
registration as a vendor on the SCM database.
6.3
The organisation or body shall commence the project within
6 (six) months after the grant funds are deposited into its
bank account by EFT failing which all such grant funds must
immediately be refunded to the City together with any
interest that may have accrued thereon in terms of clause
28
8.9 of the MOA. The MOA will be cancelled in terms of
clause 18 thereof and the grant, together with any accrued
interest, shall be immediately repaid to the City. Should this
not occur within 30 calendar days of the organisation
receiving a written notice from the City, the subcouncil or
project manager shall refer the matter, together with all the
relevant details, to the Finance Directorate’s Revenue
Department who shall pursue recovery of any amounts due
to the City in terms of clause 18 of the MOA.
7.
Processing of applications and grant approvals
administrative, regulatory and approval processes.
–
7.1 Subcouncil grants.
7.1.1
First Screening Process (FSP)
7.1.1.1
The Grants Division, shall, in conjunction with the
relevant subcouncil manager and ward councillors,
carry out a FSP of all grant applications received by
the advertised closing date. The FSP shall be chaired
by the subcouncil manager. All Councillors of the
particular subcouncil are welcome to attend the FSP.
All applications must be delivered or posted to the
offices of the subcouncil manager and no applications
may be delivered to or be accepted by any Councillor.
The subcouncil manager shall ensure that the
following requirements and/or procedures are
adhered to or implemented during the FSP:
The date of receipt of the application
must be confirmed by the subcouncil
manager who shall date stamp and sign
the application in the section reserved for
official purposes on the application form.
29

No late applications received after due
date shall be tabled at the FSP or be
processed or
considered. All the
applications must be properly listed and
detailed on the latest version of the
standard TAP template Annexure “G” by
the subcouncil manager.

This template together with all the
applications, business and project plans
and other relevant documentation must
be made available at the FSP.

The FSP must be used to assess the
applications according to the criteria set
out in this Policy and detailed in the
application form and business and
project plan.

It must ensure that the funding is
required for viable and sustainable
projects as detailed in the business and
project plans which form part of the
standardised application forms.

It ascertains that the project will be
completed with the available funds and
that there is sufficient evidence that
proper financial control will be exercised,
by the organisations, over the utilisation
of funds transferred by the City.

The process also includes the verification
of the status of the municipal account
(where applicable).
The TAP Template must be fully completed and all
decisions taken and actions required to be
undertaken or implemented by the Sub-council
manager shall be properly recorded in the official
minutes of the FSP. These minutes must reflect the
30
details and results of the assessment process in
respect of the applications being considered.

The FSP is not an official committee
meeting but an administrative process
that is chaired by the subcouncil manager
and therefore no grants applications can
be recommended at such FSP as only the
subcouncil,
in
committee,
may
recommend grants. In view of the fact
that the FSP is not an official committee
meeting any declaration or disclosure of
interests by any councillor at such FSP in
terms of the requirements of sections 5
and 7 of Schedule 1 of the Code of
Conduct for Councillors in the MSA must
be recorded in the minutes of the FSP.

The subcouncil at its meeting after the
FSP, where it considers which grant
recommendations it wishes to make,
must be informed by the subcouncil
manager of disclosures or declarations of
interests made by a councillor(s) at the
FSP. Any declaration or disclosure of
interests made by a councillor(s) at the
FSP must then be addressed by the
subcouncil in terms of Schedule 1 of the
MSA, the Code of Conduct for
Councillors.

The FSP, in addition to ensuring that all
grant
applications
and
relevant
documentation have been submitted
timeously and have been properly
completed, also serves as an information
gathering exercise that provides the
Councillors and officials with information
31
that will guide and assist in ensuring that
only those applications that have been
received by due date, that have been
fully and properly completed and that
detail projects and/or programmes which
meet the requirements of this Policy, and
other relevant policies of the City, receive
further consideration at the sub-council
meetings where the grant applications
are considered and recommended to
Council for consideration.
7.1.1.2
The FSP is mandatory and both the Budget
Department and the Grants Division will not process
or submit to the Grants Committee any grant
recommendations from subcouncils if the FSP has not
taken place and the minutes have not been
completed, verified and signed off.
7.1.2 Sub-councils - recommendations on grant funding
proposals
7.1.2.1
All the grant applications, scheduled for the FSP, must
be submitted to a meeting of the sub-council by the
sub-council manager utilising the TAP template. The
subcouncil’s decision, submitted to the Budget
Department and the Grants Division, should reflect
details of the grants recommended to Council. The
subcouncil manager must also confirm with the VAT
Section whether there are any VAT implications in
respect of the grants recommended by the Subcouncil and, if there are, what actions need to be
carried out in order to properly account for VAT.
32
7.1.3
Processing of Sub-council recommendations
7.1.3.1
The sub-council manager completes the TAP
template by including all the details of the
organisations recommended, by the subcouncil, to
receive grant allocations. The TAP template must be
fully completed and will be checked and verified by
the Grants Division before submission to the
Committee in order for it to carry out the SSP. The
decision by the Committee to support various grants
is reported to MayCo and the details of the grants
supported by the Committee are communicated to
the Budget Department by the Section 67 Grants
Division. The Budget Department will then carry out
the necessary actions to update the budget details in
either the tabled annual budget in March, the annual
budget submitted to Council for approval in May or
during the new Financial year as reports are
submitted to Council with the grant details relating to
globular amounts reflected in the approved budget.
7.1.4
Second Screening Process
subcouncil recommendations
7.1.4.1
Grants Committee – Second Screening Process (SSP)
(SSP)
considering
The Committee meets to conduct the SSP to consider
the fully completed TAP reflecting all grants
recommended by the subcouncil. The Committee will
consider all the details reflected on the completed
TAP and any additional information provided by the
Grants Division and individual members. It will then
consider whether the grants as recommended can be
supported or not depending upon whether or not the
33
projects and organisations are compliant and qualify
with or in terms of the requirements of this Policy,
other relevant policies and applicable legislation.
7.1.4.3
Where the Committee decides not to support any
grant recommendations the Grant Division will inform
the particular subcouncil(s) accordingly and request
it/them to re-consider or re-confirm its/their
recommendations. Should a subcouncil decide to reconfirm its original decision, notwithstanding the
reasons provided by the Committee for not
supporting the grant(s), the Committee will then
request the Grants Division to submit a report to
MayCo providing its reasons for not supporting the
grant and request Council to make a decision whether
it makes to approve the grant(s) as recommended by
the subcouncil notwithstanding the reasons provided
by the Committee.
7.1.4.4
MayCo and Council – report on recommendations
The Grants Secretariat drafts a report to MayCo and
Council which provides details of all grants
recommended and confirms the Committee’s
decisions to support the grants as detailed on TAP
which is signed off by the Chairperson of the
Committee. The report is initialled by the Budget
Department and signed off by the CFO or his/her
nominee before being submitted to the Legal Services
Department for confirmation of legal compliance. . It
is then submitted by the Secretariat to MayCo and
Council for consideration.
34
7.1.5 Council and Expenditure Department (Accounts Payable)
– approval and payment of subcouncil grants
7.1.5.1
The subcouncil manager shall only arrange for the MOA to
be signed after Council has considered and approved the
grants and the subcouncil manager has again confirmed
that the organisation or body is up to date with its
municipal account, where applicable, as provided for under
paragraph 6.2 above. A MOA may however only be signed
by the parties on or after 1 July of a particular financial year
notwithstanding the fact that Council has approved the
annual Budget for that year and, consequently, any grant
included therein, in the previous financial year (usually by
end of May of that year).
7.1.5.2
The subcouncil manager shall attach the relevant Council
resolution and signed TAP from the Council report together
with all other relevant documents, as required by Accounts
Payable and as set out in Annexure “E”, to his/her request
for payment of the grant and shall check and clear his/her
relevant SAP workflow message inbox each day to ensure
that all requests for release of payments of grants are
responded to and processed promptly.
7.2 Line Department grants
7.2.1
First Screening Process (FSP)
7.2.1.1
The relevant line department’s project manager,
finance manager and director in conjunction with
other relevant officials, shall carry out a first screening
of all grant applications received. The FSP must assess
the applications according to the criteria contained in
this Policy. This should ensure that the grant funding
is for viable projects as detailed in the business and
project plans which form part of the standardised
application forms, that the projects are sustainable,
35
will be completed with the available funds and there
is sufficient evidence that proper financial control will
be exercised over the grant funds.
7.2.1.2
7.2.1.3
The FSP shall also confirm that the municipal
accounts, where applicable, are up to date as
provided for under paragraph 6.2. The project
manager must keep proper minutes of each FSP.
These minutes shall reflect the details and results of
the assessment process and shall also include
disclosure of any interests and benefits of municipal
staff members in terms of Sections 5 and 5A of
Schedule 2 of the MSA. of any of the officials present
at the FSP in respect of the applications being
considered. Disclosures should be recorded on a
declaration template and be evaluated by a
supervisor to assess if any further action is required.
These templates must be signed off by the supervisor
and details recorded in a disclosure of interest
register. The FSP is not a process to either
recommend or to approve any grant application. It is
an administrative procedure and information
gathering forum that provides project and finance
managers with information that will guide and assist
them in ensuring that only those applications that are
properly and fully completed and those proposed
projects that meet the requirements of this Policy,
other relevant policies of the City and relevant
legislation, should receive further consideration.
The FSP is mandatory and the Grants Division will not
process any submissions received from line
departments if project managers have not confirmed
on the TAP template that the process has taken place
in terms of the requirements of this Policy.
36
7.2.2
Project managers and finance managers – reports
and complete documentation
7.2.2.1
The project manager, together with the relevant finance
manager, prepares reports to the relevant Portfolio
Committee recommending the grants, as considered at the
FSP, to be allocated to various organisations. These reports
must be accompanied by duly completed TAP template
when tabled at the Portfolio Committee.
7.2.2.2
Supply Chain Management (SCM) Department
Project managers must ensure that no grants are
allocated in terms of this Policy to any projects and/or
programmes which are normal line department
functions that should be carried out by line
departments as outlined in paragraph 3.4.2.
7.2.2.3
Grants Committee – (SSP)
The Secretariat arranges meetings of the Committee
in order that it can consider the reports and various
grant proposals as recommended by the line
department. The Committee need only consider the
detailed reports submitted to Portfolio Committees if
the line department has not utilised the SRP as set out
in paragraph 3.2.3 above.
The relevant finance
manager and project manager shall attend the SSP
meeting of the Committee when the item is
considered in order for the Committee to obtain
further information and more clarity as deemed
necessary.
7.2.2.2
Treasury Department (VAT Section)
37
The project and/or finance managers of the Line
Department will communicate with the officials of
the Treasury Department (VAT Section) to verify
whether there are any VAT implications, in terms of
the VAT Act The VAT Section will advise what steps
must be followed by the project and/or finance
managers in order to accommodate such implications.
7.2.3
Line Departments reports - Portfolio Committees,
MayCo and Council
The TAP as signed off by the chairperson of the
Committee is then attached to the report to the
Portfolio Committee and Council by the Line
Department to confirm the decision of the
Committee. The relevant Line Department’s Director
signs the report and it is submitted to the CFO or
nominee and Legal Services Department by the Line
Department for final signing off before being
submitted to the relevant Portfolio Committee,
MayCo and Council.
7.2.4
Council and Expenditure Department (Accounts
Payable) – approval and payment of line department
grants
7.2.4.1
The project manager shall only arrange for the MOA to be
signed after Council has considered and approved the
grants and the project manager has again confirmed that
the organisation or body is up to date with its municipal
account, where applicable, as provided for under paragraph
6.2 above. A MOA may however only be signed by the
parties on or after 1 July of a particular financial year
notwithstanding the fact that Council has approved the
annual Budget for that year and, consequently, any grant
38
included therein, in the previous financial year (usually by
end of May of that year).
8.
Processing of grant payments
8.1 Subcouncil grants
8.1.1
Subcouncil managers and the Expenditure
Department (Accounts Payable) – proper and
complete documentation and processing of
grant payments
8.1.1.1
Subcouncil managers shall only inform the successful
applicants, in writing, of Council’s decision once
Council has considered and approved the various
section 67 grants as recommended by MayCo.
8.1.1.2
The subcouncil manager arranges for the MOA,
Annexure “B”, to be signed by the organisation,
provided that the municipal account, where
applicable, is up to date as provided for under
paragraph 6.2. The MOA may only be signed by the
parties on/or after 1 July of any particular financial
year as provided for under paragraph 7.1.5 above.
8.1.1.3
The MOA, together with all the relevant
documentation as required by the Expenditure
Department (Accounts Payable) as per Annexure “E”,
is processed by that department who will deposit the
grant amount into the organisation’s bank account by
means of an electronic funds transfer after the
subcouncil manager has processed the release for
payment in SAP.
8.1.1.4
Subcouncil managers shall also inform the
unsuccessful applicants, in writing, that their grant
applications were not successful, and provide reasons
why.
39
8.1.1.5
Subcouncil managers must complete Annexure “F”
and submit it to the Auditor-General for all grants of
R25, 000 or less.
8.2
Line Department grants
8.2.1
Line Department project and finance managers and
the Expenditure Department (Accounts Payable) –
proper and complete documentation and processing
of grant payments.
8.2.1.1
Project managers shall only inform the successful
applicants, in writing, of Council’s decision once
Council has considered and approved the various
section 67 grants.
8.2.1.2
The project manager arranges for the MOA,
Annexure “B”, to be signed by the organisation when
the grant is approved provided the municipal
account, where applicable, is up to date as provided
for in paragraph 6.2. The MOA may only be signed by
the parties on/or after 1 July of any particular
financial year as provided for under paragraph 7.2.4
above.
8.2.1.3
The MOA together with all relevant documentation
as required by the Expenditure Department
(Accounts Payable) is processed by that department
who will deposit the grant amount into the
organisation’s bank account by means of an
electronic funds transfer after the relevant Line
Department has processed the release for payment in
SAP.
8.2.1.4
Project managers shall also inform the unsuccessful
applicants, in writing, that their grant applications
were unsuccessful and provide reasons why.
40
8.2.1.5
9.
Project manager must complete Annexure “F” and
submit it to the Auditor-General for all grants of
R25, 000 or less.
Utilisation of grants – control, monitoring, reporting and
recovery of grant funds - Sub-councils and Line
Departments.
9.1 Sub-council and project managers shall ensure that
those organisations or bodies who have received grants
in terms of this policy:9.1.1 comply with all the provisions of the completed and signed
MOA;
9.1.2 execute their projects successfully and achieve the clearly
defined outputs and targets and realise community
developmental outcomes.
9.1.2.1 The outputs should confirm that the grant funds have been
properly utilised in terms of the details reflected in the
approved business plan and whether the targets indicated
therein have been effectively achieved.
9.1.2.2 The outcomes should be determined and assessed
depending upon the actual benefits that have accrued to
the target community over the long term and should
confirm that the goods and/or services provided with the
grant funds and delivered to the target beneficiaries have
added value and led to an improvement in their living
conditions.
9.1.3 comply with all reporting, financial management and
auditing requirements as stipulated in the MOA;
9.1.4 implement effective, efficient and transparent financial
management as well as internal control systems to guard
against financial misconduct;
41
9.1.5 report at least monthly to the sub-council or project
manager on actual expenditure against such transfer;
9.1.6 promptly, or no longer than 3 months after the end of their
financial year, submit their audited financial statements
(where applicable) to the sub-council manager; and,
9.1.7 provide details of all assets and inventory items acquired
with grant funds and that the subcouncil and project
manager keep an inventory record of such items and
annually, for a period of 3 years, confirm in writing with the
organisation that the items are still being utilised by the
organisation for the purpose acquired.
9.2
The requirements in paragraphs 9.1.3 and 9.1.6 above do not
apply to organisations where the transfer does not exceed the
prescribed limit (to be prescribed by regulation in terms of section
67(4)(a) of the MFMA). The prescribed limit is currently R25, 000.
This amount was approved by Council, at the request of National
Treasury, and may be reviewed from time to time. The sub-council
and project manager shall, in terms of Section 67(4)(b)(i), take all
reasonable steps to ensure that the targeted beneficiaries, as
identified by the organisation or body in their application, receive
the benefit of such grants.
9.3
Should an organisation not comply with the requirements in
paragraphs 9.1.1 to 9.1.6, except in the case where paragraphs
9.1.3 and 9.1.6 are not applicable, it is in breach of the MOA and
the sub-council or project managers shall communicate in writing
with such organisation in terms of clause 18 of the MOA. The
matter, together with all relevant details will be referred to the
Finance Directorate’s Revenue Department, in order to recover
the grant funds and any interest where applicable and cancel the
MOA in terms of clause 18.3, should the organisation not
implement applicable remedial action in terms of the MOA.
42
10.
10.1
Status reports, audits and financial statements
Reports to the Committee
The Grants Division shall prepare monthly status reports on grants
of subcouncils. Such reports shall be submitted to the Committee
and subcouncil managers for information and/or action where
relevant. Quarterly status reports in respect of line department
grants, allocated in terms of this Policy, shall be compiled by the
relevant project and finance manager of each Line Department
and be submitted to the Committee.
10.2
Reports to Council
10.2.1 Subcouncil and project managers shall, in addition to the required
actions prescribed under paragraphs 9 and 10.1, submit quarterly
reports to Council on the status and outputs as defined under
paragraph 9.1.2.1 of all projects carried out with grant funding
allocated in terms of this Policy where such allocation, per project
per organisation, exceeded R200 000 in any financial year. On
completion of such projects a final report shall be submitted to
Council confirming that the project was successfully completed,
that the outputs or targets, as originally submitted and as set out
in the business and project plan Annexure “A”, were effectively
realised and achieved and that all the grant funds were utilised.
This final report will also confirm whether any of the grants funds
were not utilised by the organisation and that such amounts,
together with any interest thereon, where applicable, shall be
recovered by the sub-council or project manager as provided for
in clause 8.6 of the MOA.
10.2.2 Similar quarterly reports for projects equal to or less than
R200 000 shall, respectively, be submitted by subcouncil
managers and line department” project managers to their
subcouncils and Portfolio Committees.
43
10.3 Internal Audit Department
The Grants Division assists the City’s Internal Audit Department
when it conducts audits on grants to the extent of providing it, on
written request, with copies of any relevant supporting
documentation such as TAPs, agendas and minutes of the
Committee meetings as well as Council resolutions as evidence of
procedural governance and proper oversight. The Internal Audit
Department needs to communicate directly with subcouncil
managers and line department’s project and finance managers if it
requires any information relating to the monitoring on how the
grants are being utilised by organisations and if there is proper
compliance with all the requirements of the MOA.
10.4 Auditor General’s Office
The Grants Division provides the Auditor General’s Office, during
the annual audit and upon written request, with information per
request pertaining to the allocation of grants in terms of this
Policy. The Grants Division will provide records containing relevant
supporting documentation such as TAPs, agendas and minutes of
the Committee meetings as well as Council resolutions as
evidence of procedural governance and proper oversight. The
Auditor General’s Office, during its audit of the City’s annual
financial statements, also needs to communicate directly with
sub-council managers and line department’s project and finance
managers in order to obtain relevant details and
records/documentation in respect of grants paid out in a
particular financial year and documentary confirmation that all
the financial controls, monitoring procedures and recovery /
refund processes, where applicable, have been applied or
complied with as required in terms of this Policy.
10.5 Balance Sheet – Footnote
The Grants Division compiles a financial footnote to the Statement
of Financial Position of the City’s Annual Financial Statements
44
summarising details of grants allocated to organisations or bodies
in terms of this Policy during the particular financial year.
11. Budget and Accounting requirements
11.1 For budget and accounting purposes, it is required that:
11.1.1
Subcouncils utilise their approved operating budget
for ward allocations as allocated to projects to be
funded from the operating budget, or portions
thereof, when deciding whether to allocate grants in
terms of this Policy, whilst line departments utilise
funds, provided for this purpose, on their approved
operating budget.
11.1.2
All grant provisions, in respect of grants to be
allocated in terms of this Policy, on the approved
operating budget shall be reflected under GL account
457100 - Grants Policy allocations under each
applicable Cost Centre. Cost element 457100 shall
only be utilised to budget for and record expenditure
for grants allocated in terms of this Policy.
11.1.3
Grants are managed as projects with individual grants
being allocated a WBS number (N Project) in order for
the operating budget provision to be released and
the expenditure to be incurred within the
environment of the SAP co-module.
11.1.4
The narrative fields in SAP must to be utilised within
the prescribed parameters by the sub-council, project
or finance manager on the payment request
submitted to Accounts Payable in order to best
identify the various grant details, as reflected in the
application form and project plan, in order to assist
with the effective monitoring of expenditure and to
compile the financial footnote (paragraph 10.5 refers)
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to the Statement of Financial Position for each
financial year.
12. Funding acknowledgement and intellectual property
rights of the City
12.1 Successful applicants will be required to acknowledge the City as
the provider of grant funding in their funding record as well as any
public record in respect of grants received and in any subsequent
application for further grant funding from the City in the future in
order to confirm that these transfers of funds are also part of the
City’s endeavours to meet its strategic objectives and to assist it in
carrying out its constitutional powers and functions.
12.2 All intellectual property rights, of whatsoever nature, belonging to
the City are protected in terms of clause 11 of the MOA.
GDMC -
4 March 2013
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