RAND WATER ANNUAL REPORT 2023

Consolidated Annual Financial Statements for the year ended 30 June 2023

Notes to the Consolidated Annual Financial Statements

Figures in Rand thousand

Group

Rand Water

2023

2022 Restated *

2023

2022 Restated *

39. Contingencies Contingent assets Net over and under billing on contracts with customers

69 606 21 667

69 606 21 667

69 606 21 667

69 606 21 667

Claims against service providers

Legal proceedings to recover amounts due to Rand Water

266 228 266 228 266 228 266 228 357 501 357 501 357 501 357 501

Contingent liabilities Legal claims for damages against Rand Water

258 497 258 497 258 497 258 497

Claims for standing time by service providers ‑ Force Majuere Legal claim of loss of income due to cancelled contracts

- -

38 397 50 167

- -

38 397

50 167 258 497 347 061 258 497 347 061

Guarantees Performance guarantees given to customers and other guarantees and claims

5 751

4 751

5 751

4 751

Supply agreement

648 166 648 166 648 166 648 166 653 917 652 917 653 917 652 917

In the current year certain changes in the nature of current liabilities and assets including guarantees resulted in adjustments to the classification of contingent liabilities, contingent assets and guarantees to financial liabilities and financial assets.

Contingent Asset

1.1. The Group has a potential contingent asset of R69.6 million (2022: R69.6 million) which arose as a result of a net under‑billing against certain customers. The net under‑billing was due to incorrect meter readings. The Group, through its annual meter inspection process, identified multiple meters that were not operating as required. The Group is still in the process of negotiating the balance with the relevant customers. Collection thereof is still uncertain as of the end of the reporting period. 1.2. The Group’s R21.7 million (2022: R21.7 million) contingent asset results from a claim from a service provider where the Group was an implementing agent. The court has set aside the original judgement which had resulted in the Group being awarded R21.7 million as settlement. Based on the court ruling to set aside the default judgement, the Group has instituted a counter‑claim to recover the monies already expended. 1.3. Included in the balance of contingent assets are amounts owed to Rand Water by various customers. In these circumstances services to the entities involved are discontinued, in line with the Credit Management Policy, to recover the sums owed, amounting to R266 million.

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