CIDA EMPOWERMENT TRUST
(Registration number: IT5016/04)
ANNUAL FINANCIAL STATEMENTS

CIDA Empowerment Trust Annual Financial Statements
28 February 2007


Report of the independent auditors
to the trustees’ of the CIDA Empowerment Trust


We have audited the annual financial statements of CIDA Empowerment Trust which comprises the trustees’ report, the balance sheet as at 28 February 2007, the income statement and the statement of changes in equity, a summary of significant accounting policies and other explanatory notes, as set out on pages 3 to 13.
 
Trustees’ Responsibility for the Financial Statements
The trustees are responsible for the preparation and fair presentation of these financial statements in accordance with South African Statements of Generally Accepted Accounting Practice. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatements, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

Auditor’s Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.
 
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.  In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control.  
 
An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant estimates made by the directors, as well as evaluating the overall financial statement presentation and disclosures. We believe that the audit evidence that we have obtained is sufficient and appropriate to provide a reasonable basis for our opinion.

Opinion
In our opinion, the financial statements present fairly, in all material respects, the financial position of the trust at 28 February 2007, and of its financial performance and its cash flows for the year then ended in accordance with South African Statements of Generally Accepted Accounting Practice.
 


Deloitte & Touche
 
Per: B.G.C. Fannin
Partner
21 February 2008



REPORT OF THE TRUSTEES

The trustees have pleasure in presenting their report on the activities of the trust for the year ended 28 February 2007.

General review
The trust was registered on 14 June 2004.
 
CIDA Empowerment Trust is an investment trust which was established to fund higher level education in the accredited higher education institution, CIDA City Campus.  To achieve this objective, the Trust pursues investment opportunities related to broad-based Black Economic Empowerment.  
 
The primary objectives of the CIDA Empowerment Trust and that of its subsidiary, CIDA Empowerment (Pty) Limited, are:

  • To fund the education of its beneficiaries, the current and future black students of the CIDA Education Group, 60% of whom must be black women students (in accordance with the specifications of its Trust Deed) into perpetuity.
  • To develop, educate and train Black persons (as defined in the Broad-Based Black Empowerment Act (“the Act”), Black women and Black Designated Groups (as defined in the Act.).

In its role as a Black Economic Empowerment investor, the principle activity of the Trust is to build and manage a high-yielding investment portfolio which will generate a continuous flow of income thus enabling the Trust to fulfil its stated objectives.
 
Financial results
The results of the trust are set out in the attached annual financial statements.

Subsequent events
No events of a significant nature have occurred between the reporting date and the date of this report.

Trustees
The trustees of the trust during the year under review and up to the date of this report were as follows:

A P Blecher  
W V Cuba  (Resigned: 12 March 2007)
M E Davids  
J S De Jager (Resigned: 25 August 2007)
N P Hani Dongwana (Resigned: 1 May 2007)
P L Heinamann (Resigned: 13 December 2006)
N P Khumalo  
J Kogl
D M Lawrence  
L  Y Mashologu           
N N Mazwai  
C T Mhlongo (Resigned: 27 April 2007)
S S Ndlungwane  
C Ramaphosa   (Resigned: 5 June 2006)
D Skwambane  


The business and postal address is as follows:

Registered office Postal address
3 on Glenhove Postnet Suite 218
Corner Glenhove and Tottenham Roads Private Bag X31
Melrose Estate Saxonwold
2196   2132



INCOME STATEMENT


Notes

2007

2006



R

R

Income




Donations


7 476

-

Administration expenses

 

12 250 900

-

Profit before fair value adjustments


(180)

-

Fair value gains

3

12 250 799

-

Profit before taxation


12 258 095

-

Taxation

6

(2 450 160)

-

Net surplus for the year


9 807 935

-


BALANCE SHEET


Notes

2007

2006



R

R

Assets




Non-current assets




Investments

4

12 250 900

100

       

Current assets




Affiliated accounts receivable

5

4 430

-

Cash & cash equivalents


2 865

105 164

Total current assets


7 295

105 164

Total assets


12 258 195

105 264

       

Funds and liabilities




Funds




Founding donation


100

100

Accumulated surplus 


9 807 935

-

Total funds and reserves  

9 808 035

100


Deferred capital gains taxation

6

2 450 160

-

Current liabilities




Affiliated accounts payable

7

-

105 164

Total current liabilities


-

105 164

Total funds and liabilities

 

12 258 195

105 264


STATEMENT OF CHANGES IN FUNDS


Founding donation

Accumulated surplus

Total



R

R

Balance at 28 February 2006

100

-

100

Surplus for the year

-

9 807 935

9 807 935

Balance at 28 February 2007 

 100

9 807 935

9 808 035


CASH FLOW STATEMENT


Notes

2007

2006



R

R

Operating activities:




Cash generated from operations

8

(102 299)

105 164

Net cash (utilised in) from operating activities

 

(102 299)

105 164

       

Financing activities




Increase in trust funds received

 

-

100

Increase in investment


-

(100)

Net cash  from financing activities


-

-

       

Net (decrease) increase in cash and cash equivalents


(102 299)

105 164

Cash and cash equivalents at the beginning of the year


105 164

-

Cash and cash equivalents at end of the year


2 865

105 164


NOTES TO THE ANNUAL FINANCIAL STATEMENTS
 
1.  Presentation of financial statements

These financial statements are presented in Rands since this is the currency in which the majority of the company’s transactions are denominated.
 
2.  Summary of significant accounting policies

The annual financial statements have been prepared under the historical cost convention with the exception of certain assets that are carried at fair value, and in accordance with South African Statements of Generally Accepted Accounting Practice. The principal accounting policies adopted in the preparation of these annual financial statements are set out below and are consistent in all material respects with those applied in the previous year.
 
Taxation
Income tax expense represents the sum of the tax currently payable and deferred tax.

Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible.  The Trust’s liability for current tax is calculated using tax rates that have been enacted or substantially enacted by the balance sheet date.

Deferred tax
Deferred tax is recognised on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method.  Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised.  Such assets and liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the taxable profit not the accounting profit.
  
Deferred tax liabilities are recognised for taxable temporary differences associated with investments in subsidiaries and associates, and interests in joint ventures, except where the Trust is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future.
 
Deferred tax assets arising from deductible temporary differences associated with such investments and interests are only recognised to the extent that it is probable that there will be sufficient taxable profits against which to utilise the benefits of the temporary differences and they are expected to reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.


Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the balance sheet date. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the trust expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Trust intends to settle its current tax assets and liabilities on a net basis.

Financial instruments
Financial assets and financial liabilities are recognised on the company’s balance sheet when the company has become a party to the contractual provisions of the instrument.

Measurement
Financial instruments are initially measured at cost, which includes transaction costs.  Subsequent to initial recognition, these instruments are measured as set out below:

Trade and other receivables
Trade and other receivables are stated at their nominal value as reduced by appropriate allowances for estimated irrecoverable amounts.

Cash and cash equivalents
Cash and cash equivalents are measured at fair value.

Trade and other payables
Trade and other payables are stated at their nominal value.

Gains and losses on subsequent measurement
Gains and losses arising from a change in the fair value of financial instruments that are not part of a hedging relationship are included in net profit or loss for the year in which it arises.

Investments
Investments are recognised on a trade-date basis and are initially measured at cost.

At subsequent reporting dates, debt securities that the company has the expressed intention and ability to hold to maturity (held-to-maturity debt securities) are measured at amortised cost, less any impairment loss recognised to reflect irrecoverable amounts.  The annual amortisation of any discount or premium on the acquisition of a held-to-maturity security is aggregated with other investment income receivable over the term of the instrument so that the revenue recognised in each period represents a constant yield on the investment.

Investments other than held-to-maturity debt securities are classified as either a financial asset at fair value through profit and loss or as available-for-sale investments.  These investments are measured at subsequent reporting dates at fair value.  Unrealised gains and losses on a financial asset at fair value through profit and loss are dealt with in net profit or loss for the period.

Unrealised gains or losses on investments classified as available-for-sale are recognised in equity, through the statement of changes in equity, until the financial asset is derecognised, at which time the cumulative gain or loss previously recognised in equity is recognised in profit or loss for the period.


Cash and cash equivalents
For the purpose of the cash flow statement a change in the fair value of financial instruments that are not part of a hedging relationship on call with bank nets of bank overdraft, all of which are available for use by the company unless otherwise stated.


NOTES TO THE ANNUAL FINANCIAL STATEMENTS


% Holding

2007

2006



R

R

3. Fair value gains




ABSA Batho Bonke investment
- 180 000 ordinary shares held in Business Venture Investment no 927

8

12 250 799

-

 

12 250 799

-

 

4. Investments




Unlisted

 

 

 

3.1 At cost


 

 

- Cida Empowerment (Pty) Ltd

100 %

100

100

3.2 At fair value


 

 

-  ABSA Batho Bonke investment
180 000 ordinary shares held in  Business venture Investment no 927


12 250 800

-


12 250 900

100


5. Affiliated accounts receivable

 

 

 

CIDA Empowerment (Pty) Ltd

 

4 430

-

The amounts receivable are short-term in nature. The trustees consider that the carrying amount of affiliate accounts receivable approximate their fair value.             


 

 


6. Deferred capital gains taxation

 

 

 

Balance at the beginning of the year

 

-

-

Charge to the income statement


2 450 160

-

Balance at the end of the year

 

2 450 160

-

 

Comprising:

 

 

-

Fair value gains

 

2 450 160

-


7. Affiliated accounts payable

 

 

 

CIDA Empowerment (Pty) Ltd

 

-

105 164


8. Cash flow from operations

 

 

 

Surplus before taxation

 

12 258 095

-

Adjustments for:


 

-

Fair value gains

 

(12 250 800)

-

 

Cash flow from operations before adjustments for changes in working capital

 

7 295

-

       
Adjustments to working capital:      

Increase in affiliated accounts receivables

 

(4 430)

-

(Decrease) increase in affiliated accounts payable  

(105 164)

105 164

Total  

(105 164)

105 164

Cash flow from operations  

(102 299)

105 164


“The education offered at CIDA City Campus is designed to make students relevant, truly empowered, integrated citizens and leaders that are skilled and equipped to build the South African economy and society.”

- President Thabo Mbeki, addressing Parliament, 2001

 

“I believe the students at CIDA are using creativity and lateral thinking skills to a remarkable degree.”

- Edward De Bono

 


view print-ready
version of this page

or

cida