CGE ANNUAL REPORT

2022/23 ANNUAL REPORT

Financial Statements for the year ended 31 March 2023

Accounting Policies

1.13 Irregular expenditure Irregular expenditure as defined in section 1 of the PFMA is expenditure other than unauthorised expenditure, incurred in contravention of or that is not in accordance with a requirement of any applicable legislation, including this Act. Irregular expenditure is recognised as an expense in the Statement of Financial Performance in the year that the expenditure was incurred. The expenditure is classified in accordance with the nature of the expense. If liability as a result of losses incurred in relation to irregular expenditure can be attributed to a person, a debt account must be created if such a person is liable in law. 1.14 Fruitless and wasteful expenditure Fruitless expenditure means expenditure which was made in vain and would have been avoided had reasonable care been exercised. Fruitless and wasteful expenditure is recognised as an expense in the Statement of Financial Performance in the year that the expenditure was incurred. The expenditure is classified in accordance with the nature of the expense. If liability as a result of losses incurred in relation to fruitless and wasteful expenditure can be attributed to a person, a debt account must be created if such a person is liable in law. Related parties Significant influence is the power to participate in the financial and operating policy decisions of an entity, but is not control over those policies. Parties are considered to be related if one party has the ability to control the other party or to exercise significant influence or join the party in making financial and operating decisions. Entities in the National Sphere of government are considered related parties of the entity by virtue of the common control through Parliament. Key management is defined as being individuals with the authority and responsibility for planning, directing and controlling activities of the entity. All individuals from Management up to the Commissioners are key management individuals in their dealings with the entity. Other related party transactions are also disclosed in terms of the requirements of the Standard. The objective of the standard and financial statement is to provide relevant and reliable information and therefore materiality is considered in the disclosure of these transactions. 1.15

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