RAND WATER ANNUAL REPORT 2023

INTRODUCING OUR INTEGRATED REPORT

Relationship Capital (our interaction with stakeholders and communities), and Intellectual Capital (our know-how and creation of knowledge). This report includes other relevant and significant events that took place under the reporting period. Part of the information in this report is drawn from quarterly performance reports approved by the Board and submitted to the Department of Water and Sanitation (DWS). The Shareholder’s Compact and the Corporate Business Plan serve as the foundation for the quarterly reports. This report serves as our primary communication with stakeholders and investors. All financial figures in this report are derived from Rand Water’s Annual Financial Statements, which are approved by the Board, audited by Auditor-General of South Africa (AGSA), and prepared in accordance with IFRS. The information in this report is also reviewed by subject matter specialists and practitioners from the business, Executive Committee (EXCO), Group Audit and Risk Committee (GARC), and the Board, which bears ultimate accountability for the correctness, completeness, quality, and reliability of the contents in this report. The Annual Financial Statements are produced and published concurrently with this report. • The independence of the external auditors for the Rand Water Group, the audit scope and assessment of the effectiveness of the external audit function and the effectiveness of the Group’s internal controls and internal audit function. • Compliance with legal and regulatory requirements to the extent that it might have an impact on the financial statements. • Condonation of fruitless and wasteful expenditure and irregular expenditure. • The implementation of an appropriate enterprise-wide risk management strategy which is supported by an effective Enterprise-Wide Risk Management Framework (ERMF). • The quality and effectiveness of Rand Water’s risk management systems processes and procedures including the strategies and policies for the management of risks across the organisation.

This Integrated Annual Report is based on the International Integrated Reporting Framework issued by the International Integrated Reporting Council (IIRC), and it aims to demonstrate how the organisation’s strategy, governance, performance, and future plans lead to the creation of value at Rand Water. The report is also guided by the King IV Report on Corporate Governance (King IV) reporting standards and principles that promote good governance within the organisation as well as the benefits of ethical leadership and well-run organisations. Other regulatory requirements such as International Financial Reporting Standards (IFRS), Johannesburg Stock Exchange (JSE) Debt Listing requirements and Public Finance Management Act (PFMA), Act No. 1 of 1999 as amended were also considered in developing this report. Rand Water’s Integrated Annual Report reflects on both its financial and non-financial performance for the period 1 July 2022 to 30 June 2023. The report is organised around Six (6) Capitals: Financial Capital (financial performance), Manufactured Capital (our infrastructure plans and performance) Human Capital (our people), Natural Capital (our interaction with the environment), Social and The Board of Rand Water resolved to form a Group Audit and Risk Committee (GARC), combining the Audit and Risk Committee of the subsidiaries Rand Water Foundation and Rand Water Services, with that of Rand Water. GARC has been established primarily to assist the Board in overseeing, inter alia, the following: • The quality and integrity of Rand Water’s integrated reporting, the consolidated Rand Water Group (the Group) financial statements, sustainability reporting, and public announcements in respect of the financial results. • The effectiveness of Rand Water’s assurance functions and services, with particular focus on combined assurance arrangements, including external assurance service providers, the internal audit, and the finance function.

ASSURANCE APPROACH TO IMPROVE CREDIBILITY

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