CGE ANNUAL REPORT

2022/23 ANNUAL REPORT

Financial Statements for the year ended 31 March 2023

Notes to the Financial Statements for the year ended 31 March 2023

Figures in Rand

2023

2022

26.

Contingencies

In terms of the National Treasury practice notes, the Commission is required to surrender surplus funds generated from operating activities in a reporting period back to the Revenue Fund. For the 2022/2023 period, the Commission reported a net surplus of R 7 301 347. The possible exposure of the surrender of the surplus funds has been estimated to be R 14 982 905 based on the computation guidelines provided by National Treasury. The Commission intends to apply for a permission to retain the whole of the surplus for use during the 2023/2024 financial year, and it is expected that National Treasury will grant the application. In terms of the regulatory prescriptions, the decision for surrender or retention will be made upon a declaration based on the audited results and contingent upon the discretion of the Director-General of National Treasury. A final determination shall be upon application by the Commission on the basis of audited outcomes set for 31 July 2023. In addition, a claim by a former Chief Executive Officer on unfair discrimination have been referred to the Labour Court, and the Commission through its lawyers has since opposed the suit. As of reporting date, the matter is yet to be decided in the Labour Court. In terms of Section 194 of the Labour Relations Act No.66 of 1995, a limit to compensation is between 12 and 24 months salary which is therefore to a maximum of R3 million at the upperbound of the financial exposure to the Commission. Furthermore, the former Chief Executive Officer is also challenging CGE in the Labour Court on leave days issue. The Commission through its lawyers has not opposed and the claim have been accrued pending the final determination by the Court.

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