BANKSETA ANNUAL REPORT 2023

ANNUAL FINANCIAL STATEMENTS ACCOUNTING POLICIES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2023 14. SEGMENT REPORTING (continued) The BANKSETA does not have activities or units that meet the definition of a ‘segment’ per the Accounting Standard. The BANKSETA’s administrative units and functional departments do not undertake activities that generate economic benefits or service potential separately from the SETA as a whole. Management has assessed that the BANKSETA operates as one segment both from a service and geographical point of view. Management is of the opinion that the standard is therefore not applicable to the BANKSETA. 15. RESERVES Net assets is classified based on the restrictions placed on the distribution of monies received in accordance with the Skills Development Act and Grant Regulations as follows:

- - - -

Administration reserve Employer grant reserve Discretionary reserve Unappropriated surplus

Employer levy payments are set aside in terms of the Skills Development Act and the regulations issued in terms of the Act, for the purpose of:

2022/23

2021/22

%

%

Administration costs of the SETA

10,5 20,0 49,5 80,0 20,0

10,5 20,0 49,5 49,5 20,0

Employer grant fund levy

Discretionary grants and projects

Received by the SETA

Contribution to the National Skills Fund

100,0

100,0

In terms of section 4(4) of the SETA grant regulations, the Minister determines the percentages for mandatory and discretionary levies and grants in consultation with the sector. In 2012, the Minister changed the mandatory grant and levy percentage from 50% to 20%. In October 2019, the courts set aside the Minister’s 2012 decision to decrease the mandatory grant and levies portion from 50% to 20%. The courts did not set the new mandatory percentage to be applied from the court decision date onwards. The effect of the ruling is that the Minister would have to decide on the percentage for mandatory grants in consultation with the sector. The Minister has not yet made the decision in regard to the mandatory levy or grant percentage. DHET continued to show the mandatory levy portion as 20% in the 2022/23 year in the levy download information. The SETA continued to pay and accrue mandatory grants at 20% in the 2022/23 year in the absence of the revised percentage, as 20% is the amount aligned to the approved annual performance plan. The SETA board has ratified the utilisation of 20% while awaiting the Minister’s decision. The mandatory grants expenditure in note 14 as well as the mandatory grant liability in note 7 were calculated using the mandatory grant percentage of 20%.

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BANKSETA ANNUAL REPORT 2022/23