## PRASA Revenues and Expenditures and Market Test 2018-2022

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### Background
- GFS training and TA mission: in-person, July 31–August 11, 2023, Pretoria.
- Mission team: Mr. Philip Stokoe (lead) and Ms. Foyzunnesa Khatun.
- Participants: staff from the South African Reserve Bank (SARB), National Treasury (NT) and Statistics South Africa (STATS SA). Average attendance: 35 participants each day during the training week.
- Training topics: sector classification, revenue, expenditure, financing, consolidation, the balance sheet, compilation of GFS from SOCs/EBIs. Second week: technical discussions on RAF, treatment of financial support to ESKOM, and other methodological issues.

### Key findings on data sources, compilation, and disclosure
- South Africa publishes comprehensive fiscal reports; SARB Quarterly Bulletin (QB) provides consolidated general government revenue, expenditure, financing, and some public corporation balance sheets.
- NT’s deficit presentation is closer to GFSM 1986 than GFSM 2014 due to inclusion of policy lending as expenditure.
- STATS SA does not publish balance sheet information other than the consolidated statement of financial position for municipalities.
- Main national/provincial expenditure source: Vulindlela SCoA (not yet mapped to GFSM 2014). NT leading a project to map SCoA to GFSM 2014.
- Municipal data: STATS SA quarterly surveys (about 130 of 257 municipalities) and Section 71 mSCOA reporting; mSCOA not yet mapped to GFSM 2014.
- SARB currently shows a zero statistical discrepancy by using changes in cash as a residual; mission recommends SARB disclose the statistical discrepancy and aim for discrepancy less than 0.1 percent of GDP.
- Consolidation of grants is challenged by timing (accrual local government vs modified-cash national/provincial) and classification differences.
- SARB’s experimental public sector debt and IEA balance sheets should be reconciled and coverage differences explained.
- Public financial corporations coverage in QB is incomplete (excludes SARB, Land Bank, Postbank, CPD); expand reporting to include all public financial corporations.

### Sector classification and PSCC issues
- PSCC publishes Institutional Sector Classification Guide (ISCG), last updated August 2022.
- GFSM 2014 market test and control criteria underpin classification between general government and public corporations.
- Mission identified specific classification issues and recommended PSCC reviews:
  - RAF: currently classified as a social security fund; mission recommends reclassification to extrabudgetary institutions (EBI).
  - PRASA: ISCG lists PRASA as a public nonfinancial corporation; mission concludes PRASA should be classified as a general government unit, likely back to 2018 and possibly earlier.
  - CODI: newly established; mission recommends classifying CODI as a general government unit.
  - Additional entities for review: MINTEK, South African Nuclear Energy Corporation, Trans-Caledon Tunnel Authority (TCTA), eight regional Water Boards, municipal trading services, universities and TVET colleges.

### PRASA: revenues, expenditures, and market test (values shown as in source)
- Year ending 31 March: 2018, 2019, 2020, 2021, 2022
- Total Revenue: 14,162   13,959   16,204   11,399   18,741
- A Fare Revenue: 1,802   1,516   1,049   178   343
- B Operating lease rental income: 675   773   725   527   608
- C Interest: 968   1,012   1,520   1,095   1,005
- D Other Income: 170   308   273   125   116
- E Operating Subsidy: 5,876   6,577   8,376   9,474   16,669
- F Capital subsidy: 4,671   3,474   4,259   -     -
- G Fair Value Adjustments / actuarial gains: -     299   2   -     -
- Total Expenditure: 12,756   16,101   13,927   14,528   12,891
- H Employment related costs: 5,444   5,688   5,789   5,772   5,876
- I Depreciation and amortization: 2,357   2,184   2,518   2,942   2,479
- J Repairs and maintenance: 645   1,232   1,070   378   410
- K General expenses: 4,339   7,536   4,238   2,602   3,618
- L Finance costs: 12   22   34   29   40
- M Impairment losses / reversal of impairments: (41)  (657)  (19)  1,155   76
- N Loss on disposal of assets: -     96   245   1,535   76
- O Fair value adjustments: -     -     52   115   316
- H Employment related costs (repeated line): 5,444   5,688   5,789   5,772   5,876
- Deficit / Surplus: 1,406   (2,142)  2,277   (3,129)  5,850
- Market Test (A+B+D) / (H+I+J+K+L): 21% 16% 15% 7% 9%
- Mission conclusion: PRASA has not passed the GFSM 2014 quantitative market test and should be reclassified as a government unit; extend the market test and reclassify PRASA as far back as required.

### Road Accident Fund (RAF): transactions, balance sheet, and compilation impacts
- Revenue classification: main revenue (fuel levy) should be classified as excise tax (GFS code 1142) and likely recorded as national government tax revenue then transferred to RAF as a grant.
- Expenditure classification: RAF benefit payments should be recorded as social assistance benefits (not social security benefits).
- RAF liabilities and accounting changes:
  - RAF 2019-20 annual report total liabilities: R332 billion (approximately 6 per cent of GDP), mostly claims liabilities of R331 billion:
    - “liability for outstanding claims recorded” (OCR): R213 billion
    - “liability for claims incurred, but not yet reported” (IBNR): R103 billion
  - RAF latest financial statements (31 March 2022): total liabilities fell to R28 billion, or just 0.4 per cent of GDP, reflecting a new accounting policy.
- Income statement impacts:
  - 2020 accounts showed a deficit for the year of R59 billion (1 per cent of GDP).
  - 2021 and 2022 accounts showed small surpluses.
- Table: RAF Revenue, Expenditure, Deficit and Liabilities 2018-19 to 2021-22 (R billion)
  - Total Revenue: 2018-19: 43.2; 2019-20: 41.2; 2020-21: 42.3; 2021-22: 48.2
  - Total Expenditure: 2018-19: 99.0; 2019-20: 100.9; 2020-21: 40.5; 2021-22: 47.8
  - Deficit for the year: 2018-19: (55.8); 2019-20: (59.6); 2020-21: 1.8; 2021-22: 0.4
  - Total Liabilities: 2018-19: 273.3; 2019-20: 321.7; 2020-21: 31.5; 2021-22: 27.7
- Comparison of accrual vs cash GFS (Table 3 results, R billion):
  - Accrual Basis 2018-19: 1 Revenue: 43.2; 2 Expense: 99.0; 31 Net Investment in nonfinancial assets: 0.0; NLB (1-2-31): (55.8)
  - Accrual Basis 2019-20: 1 Revenue: 41.2; 2 Expense: 100.9; 31 Net Investment in nonfinancial assets: 0.0; NLB: (60.0)
  - Cash Basis 2018-19: 1 Revenue: 42.0; 2 Expense: 42.6; 31 Net Investment in nonfinancial assets: 0.0; NLB: (0.5)
  - Cash Basis 2019-20: 1 Revenue: 42.7; 2 Expense: 42.2; 31 Net Investment in nonfinancial assets: 0.0; NLB: (0.5)
  - Accrual Basis* 2020-21: 1 Revenue: 42.3; 2 Expense: 40.5; 31 Net Investment in nonfinancial assets: 0.0; NLB: 1.8
  - Accrual Basis* 2021-22: 1 Revenue: 48.2; 2 Expense: 47.8; 31 Net Investment in nonfinancial assets: 0.0; NLB: 0.4
  - Source: RAF Annual Reports for 2019-20 and 2021-22 and Mission Calculations; * New accounting basis
- Mission stance:
  - Under prior accounting OCR and IBNR resembled insurance technical reserves; as a general government unit, statistical approach likely records an account payable equal to claims recorded (OCR) but not IBNR.
  - Mission skeptical that RAF’s recent accounting approach and substantially lower claims liabilities are appropriate for fiscal statistics.
  - On a cash basis RAF ran largely balanced budgets or modest surpluses/deficits; mission questioned whether cash accounting is appropriate and suggested a modified cash approach may be better.
  - Follow-up TA missions needed to review RAF classification, transactions, and balance sheet recording; adjustments could materially affect general government deficit and stock of debt.

### Recording of ESKOM support
- NT plan (Annexure W3, 2023 Budget Review): relieve portion of ESKOM’s unsustainable debt via interest free subordinated loan convertible to equity.
- Mission guidance: record the operation above the line as payments for financial assets (capital injection), consistent with GFSM 2014 Chapter 6 and Appendix 3.
- Key GFSM 2014 considerations for classification: absence of effective claim and unlikely realistic return support above-the-line recording as payments for financial assets.

### Recording of free basic services
- National policy: free basic water (six kiloliters/month per poor household), energy (50 kilowatt-hours/month), sanitation and refuse removal.
- 2023 Budget Review Annexure W1: local government equitable share for 2023/24 attributable to basic services shown as almost R71 billion — almost 23% of total general government social benefits recorded by SARB in fiscal year 2021/2022.
- Recommendation: record free basic services as social benefits in GFS; further work needed to identify and record the relevant flows and to separate municipal trading services from wider local government.

### Balance sheet compilation for public corporations and presentation issues
- SARB uses IFRS/SA GAAP balance sheets to compile GFS but conceptual differences require adjustments:
  - Provisions (e.g., ESKOM provisions ~R60 billion) may not be recorded in macro statistics except in defined circumstances.
  - Deferred tax assets/liabilities and preference shares require careful statistical treatment (preference shares treated as debt security per GFSM 2014 §7.150).
- Presentational recommendations:
  - Revise social security funds sub-sector balance sheet presentation to align with local government presentation and avoid misleading recording of liabilities as equity.
  - Ensure terminology for instruments is consistent across tables (e.g., "debt securities" and "securities other than shares").
  - Expand experimental public sector debt tables to show instrument breakdowns by main sub-sectors.

### Discrepancies across compilers and data differences
- Comparison 2020/21 consolidated general government GFS between STATS SA and SARB (R million):
  - Revenue cash flows: STATS SA 1,564; SARB 1,826; Differences 262
  - Selected revenue components:
    - 11 Taxes: 1,364; 1,379; Differences 15
    - 14 Other receipts: 171; 419; Differences 248
  - Expense cash flows total: Statistics SA 1,983; SARB 2,217; Differences 235
  - Net cash flow from operating activities: -419; -391; Differences 28
  - NET CHANGE IN THE STOCK OF CASH: 123; 69; Differences -54
- NT’s consolidated government account and ISCG differ on inclusion of PRASA and several public nonfinancial corporations; PSCC review recommended to ensure consistent delineation.

### Priority recommendations, target dates, and responsibilities
- December 2023:
  - Record the ESKOM Bailout as a capital transfer, above the line, in line with GFSM 2014 guidance — Responsible: SARB / STATS SA / NT
- December 2024:
  - Review the Classifications of RAF, PRASA and CODI and classify / reclassify (as appropriate) in the ISCG — Responsible: PSCC
  - Review the treatment of RAF transactions and balance sheet entries, include as key topic in follow up TA Mission — Responsible: SARB, STATS SA, NT
  - Authorities to prioritize NT led project to map the national SCoA to GFSM 2014 — Responsible: NT, STATS SA, SARB
  - Review classification of other nonfinancial corporations (e.g., Mintek, Water Boards) treated as part of consolidated government by NT — Responsible: PSCC/NT
  - Publish the statistical discrepancy between above- and below-the-line measures of the deficit in the QB — Responsible: SARB
  - Revise presentation of balance sheet data for social security funds sub-sector to align with local government presentation — Responsible: SARB
  - Expand experimental public sector debt presentation to include instrument breakdowns by key sectors — Responsible: SARB
  - Expand publication of data for public financial corporations to include SARB, CPD, Land Bank and Post Bank — Responsible: SARB
  - Revise balance sheet data for local governments and public corporations to align with statistical definitions of assets and liabilities — Responsible: SARB
  - Review classification of municipal trading services and municipal owned companies; classify as public nonfinancial corporations/quasi-corporations where appropriate — Responsible: PSCC
  - Review governance arrangements for universities and TVET colleges and confirm classification basis — Responsible: PSCC

### Appendix highlights (selected numeric exhibits)
- RAF GFS Data 2018-19 to 2021-22 (cash and accrual basis) — selected entries (R million):
  - Accrual Basis 2018-19 Revenue: 43,239,323; Expense: 99,018,733; NLB: -55,779,410
  - Accrual Basis 2019-20 Revenue: 41,240,480; Expense: 100,864,358; NLB: -59,597,779
  - Cash Basis 2018-19 Revenue: 41,990,522; Expense: 42,575,156; NLB: -510,081
  - Cash Basis 2019-20 Revenue: 42,699,184; Expense: 42,231,756; NLB: 491,132
  - Accrual Basis* 2020-21 Revenue: 42,248,516; Expense: 40,464,724; NLB: 1,783,792
  - Accrual Basis* 2021-22 Revenue: 48,154,678; Expense: 47,756,820; NLB: 390,997
- Appendix II — Stock-flow adjustments for 2022 Annual GFS submission (2018-2021) — selected entries (R million):
  - Financial assets: Currency and deposits Stock: 520 (2018), 566 (2019), 663 (2020), 670 (2021)
  - Liabilities: Debt securities Stock: 2,732 (2018), 3,178 (2019), 3,822 (2020), 4,059 (2021)

*IMF | Technical Report – South Africa Government Finance Statistics*

### 1.     PRASA Revenues and Expenditures and Market Test 2018-2022 ___________________________ 14

### 1.     PRASA Revenues and Expenditures and Market Test 2018-2022 ___________________________ 14

### Background
- A Government Finance Statistics (GFS) training and technical assistance (TA) mission was conducted in-person between July 31–August 11, 2023, in Pretoria at the request of the authorities.
- Mission team: Mr. Philip Stokoe (lead) and Ms. Foyzunnesa Khatun.
- Participants: staff from the South African Reserve Bank (SARB), National Treasury (NT) and Statistics South Africa (STATS SA). Average attendance: 35 participants each day during the training week.
- Training covered: sector classification, revenue, expenditure, financing, consolidation, the balance sheet, and compilation of GFS from the financial statements of state-owned companies (SOCs) or extrabudgetary institutions (EBIs).
- Second week focused on technical discussions including classification and treatment of the Road Accident Fund (RAF), treatment of financial support to ESKOM, and other methodological issues.

### Key Findings
- South Africa publishes a wide range of comprehensive fiscal reports. The Quarterly Bulletin (QB) produced by SARB is one of the most comprehensive fiscal reports, with data on revenue, expenditure, and financing for consolidated general government, and information on non-financial and (some but not all) financial public corporations. The QB includes balance sheets for local governments, social security funds, and public corporations. Experimental statistics on consolidated public sector debt are published.
- STATS SA and NT also compile and publish annual government finance statistics. NT’s presentation of the deficit is closer to GFSM 1986 than GFSM 2014 due to inclusion of policy lending as part of expenditure. STATS SA do not compile or publish balance sheet information other than the consolidated statement of financial position for municipalities.
- Data sourcing and compilation can be improved. A key improvement is use of data from the Vulindlela system. NT is leading a project to map the national accounting data (SCoA) to GFSM 2014, which should simplify and streamline compilation of GFS data. Greater use of Municipal Chart of Accounts (MSCOA) could improve local government data.
- SARB should publish the statistical discrepancy between above-the-line (revenues and expenditure) and below-the-line (financing) measures of the deficit. The mission recommended aiming for a discrepancy of 0.1 percent of GDP or less. The QB currently shows a zero statistical discrepancy achieved by using changes in cash as a residual; SARB is encouraged to disclose the statistical discrepancy and investigate large discrepancies.
- Public sector classification underpins fiscal data. The Public Sector Classification Committee (PSCC) publishes classifications in the Institutional Sector Classification Guide (ISCG), with the most recent iteration published in September 2022.
- The mission identified several classification issues and recommended PSCC reconsider classifications for several entities:
  - RAF is currently classified as a social security fund but should be reclassified as an extrabudgetary institution.
  - PRASA is currently classified in ISCG as a public nonfinancial corporation but should likely be reclassified as a government unit back to 2018 and likely several years beforehand.
  - The newly established CODI should likely be classified as a general government unit, consistent with GFSM 2014 guidance on financial protection schemes.
  - Additional units for further consideration include MINTEK, the South African Nuclear Energy Corporation, the Trans-Caledon Tunnel Authority, and the eight regional Water Boards.
- STATS SA and SARB treat municipality trading entities differently. STATS SA treat these entities as public nonfinancial corporations (reducing local government revenues and expenditures relative to SARB). STATS SA’s treatment is likely correct for many entities, but a full classification review is necessary.
- RAF accounting changes in recent years have significantly reduced reported liabilities and annual accrual deficit; these changes are the subject of legal dispute between RAF and the Auditor General of South Africa (AGSA). The mission and the auditor general are skeptical that the more recent accounting approach and substantially lower claims liabilities are appropriate from a statistical perspective.
  - On a cash basis, RAF has run a largely balanced budget or modest surpluses / deficits.
  - Large accrual deficits (at least in the accounts prior to 2021) raise questions about whether cash accounting is appropriate for RAF and whether a modified cash approach would be better.
  - Further work is needed to clarify how RAF should be recorded in fiscal statistics; this will be a key task for a follow-up TA mission.
- Treatment of ESKOM support: NT intends to relieve a portion of ESKOM’s unsustainable debt via interest free loans that would subsequently be converted into equity. The mission reiterated this operation should be recorded above the line (capital transfers) in line with GFSM 2014.
- Other recommendations for fiscal data improvements included:
  - Investigating options to adjust data to reflect provision of free basic services to households (water, electricity and refuse collection).
  - Improvements to compilation of balance sheet data for social security funds, public financial and nonfinancial enterprises and corporations.
  - Reporting data for all public financial enterprises and corporations (current SARB QB tables exclude SARB itself, Land Bank, Postbank and Corporation for Public Deposits (CPD)).
  - Presentational improvements to experimental public sector debt tables.

### Priority Recommendations (with target dates and responsible institutions)
- December 2023: Record the ESKOM Bailout as a capital transfer, above the line, in line with GFSM 2014 guidance — SARB / STATS SA / NT
- December 2024: Review the Classifications of RAF, PRASA and CODI and classify / reclassify (as appropriate) in the ISCG — PSCC

### Other Recommendations (with target dates and responsible institutions)
- December 2024: Review the treatment of RAF transactions and balance sheet entries, and determine the correct treatment in fiscal statistics — include as a key topic in follow up TA Mission — SARB, STATS SA, and NT
- December 2024: Authorities are encouraged to prioritize the NT led project to map the national SCoA to GFSM 2014 — NT, STATS SA, SARB
- December 2024: Review the classification of other nonfinancial corporations (e.g., Mintek, Water Boards) treated as part of the consolidated government by NT, and confirm the correct classification — PSCC
- December 2024: Publish the statistical discrepancy between above and below-the-line measures of the deficit in the QB — SARB
- December 2024: Revise the presentation of balance sheet data for the social security funds sub-sector to be in line with the local government presentation — SARB
- December 2024: Expand the presentation of experimental public sector debt to include instrument breakdowns by key sectors of the public sector — SARB
- December 2024: Expand the publication of data for public financial corporations to include all public financial corporations, including SARB, CPD, Land Bank and Post Bank — SARB
- December 2024: Revise balance sheet data for social security funds and public corporations to ensure data is in line with statistical definitions of assets and liabilities — SARB
- December 2024: Review the classification of municipal trading services and municipal owned companies, and where appropriate classify as public nonfinancial corporations and quasi-corporations — PSCC
- December 2024: Review the governance arrangements for universities and technical and vocational colleges and confirm the basis for classification in the public sector — PSCC

### Detailed Technical Assessment — Compilation of GFS
- The SARB Quarterly Bulletin (QB) publishes quarterly statistics on revenue, expenditure, and financing activities for the consolidated general government in accordance with GFSM 2014.
- The QB contains information on non-financial and financial public corporations, but these are not consolidated with general government to produce consolidated public sector data (except for the Nonfinancial public sector borrowing requirement, published in Table S-77 of the QB).
- STATS SA and NT compile annual government finance statistics. NT’s presentation of the deficit is closer to GFSM 1986 than GFSM 2014 because policy lending is included as expenditure.
- Section 32 of the Public Financial Management Act (PFMA) requires National Treasury to publish a statement of actual revenue and expenditure with regard to the National Revenue Fund within 30 days of the end of the month. Provincial treasuries must submit statements at least quarterly. SARB uses Section 32 reports when compiling GFS but notes Section 32 reports have limited information on expenditure.
- Main data source for national and provincial government expenditure is the Vulindlela system, which uses a Standard Chart of Accounts (SCoA) not yet mapped to GFSM 2014. Mappings are currently performed separately by STATS SA. STATS SA map at a more granular level (based on descriptions under economic classifications in the SCoA) than SARB, which does not have access to Vulindlela data. This can result in classification and data differences between GFS compiled by STATS SA and SARB. A comparison for 2020/21 is provided in Table 4 of Annex C.
- NT’s project to map the SCoA for National and Provincial governments to GFSM 2014 is important. Once completed, the mapped SCoA should form the basis of GFS compilation for National and Provincial governments for all organizations.
- Vulindlela is supplemented with other sources. Examples:
  - Legislatures and parliament report on an accrual basis of accounting, while the rest of departments are under modified cash basis.
  - STATS SA also use audited Annual Financial Statements (AFS).
- Local government information is primarily sourced from STATS SA surveys conducted quarterly, typically receiving responses from 130 selected municipalities of the 257 municipalities. Section 71 of the Municipal Finance Management Act (MFMA) requires municipalities to report revenue, expenditure, and borrowings to Provincial Treasuries monthly; NT publishes this in-year monitoring information. STATS SA has a project to compare survey data with Section 71 reports for municipalities reporting to the survey. It is important to understand differences and use one main source as the basis for local government GFS.

*IMF | Technical Report – South Africa Government Finance Statistics*

### 24.        Section 71 reports include a Municipal Standard Chart of Accounts (mSCOA). Similar to

### tarea2024013 - 24.        Section 71 reports include a Municipal Standard Chart of Accounts (mSCOA). Similar to

### Municipal Standard Chart of Accounts (mSCOA) and mapping to GFSM 2014
- Local governments report revenue and expenditure using a SCoA; mSCOA is not currently mapped to GFSM 2014.
- Authorities are encouraged to conduct an exercise that maps the mSCOA to GFSM 2014 consistently with the national SCoA.

### SARB surveys, extra-budgetary units, and public corporations
- SARB conducts quarterly surveys (F02 and F04 Form surveys) to obtain information on:
  - revenue, expenditure, transactions in financial assets and liabilities, and stocks.
- Survey usage and limitations:
  - Data used to compile GFS for national extra-budgetary units, social security funds, and public financial and non-financial corporations.
  - Surveys have issues with response rates, requiring quarterly estimation by SARB for institutions that have not responded.
  - Larger public corporations such as Eskom consistently report on a quarterly basis.

### Consolidation of grants and inter-government transactions
- Two main types of grants from National Government to other levels:
  - division of revenue grants (based on the Division of Revenue Act);
  - conditional grants for national priorities in provincial and local budgets.
- Consolidation challenges:
  - SARB and STATS SA experience difficulties consolidating grants fully, notably due to timing differences as local governments report on an accrual basis whereas national and provincial governments report on a modified-cash basis.
  - Variances can arise from differences in classification between national and other levels of government.
  - Other transactions such as payments for services between government units are also consolidated.
- Planned follow-up:
  - Issues around consolidation of grants will be explored in a future technical assistance mission.

### Statistical discrepancy, above- and below-the-line deficit, and disclosure
- GFSM 2014 encourages compilation of detailed GFS including above-the-line (revenues and expenditure) and below-the-line (financing) to allow deficit calculation both ways; conceptually deficits should match.
- Definition and recommended threshold:
  - Any difference between above and below-the-line deficit is the “statistical discrepancy”.
  - It is recommended that this is less than 0.1   percent of GDP.
- Current practice and recommendation:
  - The QB shows a zero statistical discrepancy as movements in cash are used as a residual for differences between net lending/borrowing and financing.
  - SARB are strongly encouraged to disclose this statistical discrepancy and seek to keep it at recommended levels.
- Recommendation with target date:
  - December 2024: Publish the statistical discrepancy between above and below the line measures of the deficit in the QB — Responsible: SARB.

### Public sector balance sheets, IEA, and stock-flow adjustments (SFA)
- Experimental public sector debt and balance sheet data:
  - Published using SARB’s Integrated Economic Accounts (IEA).
  - QB contains an experimental balance sheet compiled from SARB’s IEA project.
  - Differences exist between IEA balance sheet information and official statistics in SARB; SARB have a project to identify and resolve differences.
  - Ideally, public sector balance sheets in the QB and IEA should be the same; any coverage differences should be explained.
- Other economic flows and SFAs:
  - GFSM 2014 integrated framework requires all changes in the balance sheet between two periods be explained by transactions and other economic flows.
  - SARB do not report other economic flows (holding gains/losses and other changes in volume of assets and liabilities) in the QB or the annual submission to the IMF.
  - Differences between transactions and changes in stock levels can be inferred as a “stock-flow-adjustment” (SFA).
  - The mission presented SFAs from the annual GFS submission (shown in Table 3 in Appendix B).
  - SARB should review any large differences to ensure no data quality or compilation issues.
- Recommendation with target date:
  - December 2024: Authorities are encouraged to prioritize the NT led project to map the national SCoA to GFSM 2014. — Responsible: NT, STATS SA, SARB.

### Sector classification: institutional boundaries and governance
- Framework and coordination:
  - Classification of institutional units and delineation of public sector between general government and public corporations is the starting point for high-quality fiscal data.
  - GFS compilers in South Africa jointly agree on classification through the PSCC.
  - SARB publishes the Institutional Sector Classification Guide (ISCG) for South Africa, updated every 5-6 years; last updated and published in August 2022.
- GFSM 2014 guidance highlights:
  - General government consists of resident institutional units that fulfill the functions of government as their primary activity.
  - General government includes all non-market units controlled by government units, with guidance on recognizing control (extent of government ownership, powers to appoint management, regulatory ability), with different rules for companies versus not-for-profit entities.
  - Public corporations must be “market producers”; GFSM 2014 provides quantitative “market test” for nonfinancial activities and functional tests for financial activities.

### Findings on specific classifications and entities
- ISCG coverage:
  - ISCG identifies public sector units across subcategories: central government, consolidated provincial governments, local governments, and wider public sector.
  - The wider public sector identifies 38 public nonfinancial corporations and a number of public financial corporations in several sub-categories.
  - Some public financial corporations are not clearly identified in ISCG, including SARB itself, the Land Bank, and the Post Bank; SARB may wish to consider restructuring ISCG to more clearly identify all public financial corporations.
- Review outcomes and recommended reclassifications:
  - The mission did not conduct a comprehensive review of ISCG listings but identified entities for further review.
  - Road Accident Fund (RAF):
    - Currently classified in ISCG as a social security fund; this is incorrect.
    - Social security funds operate contributory social insurance schemes; RAF benefits are social assistance (not contingent on contributions) and RAF is funded by a tax on fuel.
    - GFSM 2014 §5.96 treats such levies as excises taxes even if used to finance social benefits.
    - Recommendation: review RAF classification with expectation it would be reclassified from social security funds sub-sector to national extrabudgetary institutions sub-sector.
  - Passenger Rail Authority of South Africa (PRASA):
    - ISCG lists PRASA as a public nonfinancial corporation; mission concludes it should be classified as a general government unit.
    - PRASA has been heavily reliant on government subsidies to meet operating costs; it has not passed the quantitative market test in GFSM 2014 §2.69.
    - Mission recommends the market test for PRASA be extended and PRASA reclassified as a government unit as far back as required.
    - Table 1: PRASA Revenues and Expenditures and Market Test 2018-2022 (values shown as in source):
      - Year ending 31 March: 2018, 2019, 2020, 2021, 2022
      - Total Revenue: 14,162   13,959   16,204   11,399   18,741
      - A Fare Revenue: 1,802   1,516   1,049   178   343
      - B Operating lease rental income: 675   773   725   527   608
      - C Interest: 968   1,012   1,520   1,095   1,005
      - D Other Income: 170   308   273   125   116
      - E Operating Subsidy: 5,876   6,577   8,376   9,474   16,669
      - F Capital subsidy: 4,671   3,474   4,259   -     -
      - G Fair Value Adjustments / actuarial gains: -     299   2   -     -
      - Total Expenditure: 12,756   16,101   13,927   14,528   12,891
      - H Employment related costs: 5,444   5,688   5,789   5,772   5,876
      - I Depreciation and amortization: 2,357   2,184   2,518   2,942   2,479
      - J Repairs and maintenance: 645   1,232   1,070   378   410
      - K General expenses: 4,339   7,536   4,238   2,602   3,618
      - L Finance costs: 12   22   34   29   40
      - M Impairment losses / reversal of impairments: (41)  (657)  (19)  1,155   76
      - N Loss on disposal of assets: -     96   245   1,535   76
      - O Fair value adjustments: -     -     52   115   316
      - H Employment related costs (repeated line): 5,444   5,688   5,789   5,772   5,876
      - Deficit / Surplus: 1,406   (2,142)  2,277   (3,129)  5,850
      - Market Test (A+B+D) / (H+I+J+K+L): 21% 16% 15% 7% 9%
  - Discrepancies across compilers:
    - NT’s consolidated government account (Annexure W2 of the 2023 Budget Review) and ISCG listings differ; NT includes PRASA and several ISCG-listed public nonfinancial corporations in consolidation (e.g., MINTEK, South African Nuclear Energy Corporation, TCTA, eight regional Water Boards).
    - Recommendation: PSCC review classification of these entities to ensure common approach and shared view of the general government boundary.
  - Universities and TVET Colleges:
    - SARB classifies universities and TVET Colleges within general government; NT does not consolidate these in its consolidated government accounts.
    - Classification varies internationally; mission recommends PSCC review extent of public sector control over South African universities to confirm classification inside public sector.
  - Municipal trading services and municipal owned companies:
    - Municipalities largely responsible for distribution of water and electricity; services handled by separate entities (e.g., City Power Johannesburg (Pty) Ltd, Johannesburg Water SOC Ltd) or ringfenced accounts.
    - STATS SA treats these trading services as separate nonfinancial corporations in national accounts and annual GFS; SARB does not separate these in GFS.
    - Result: SARB-published local government and general government GFS data show higher revenue and expenditure compared to STATS SA data for same period (STATS SA excludes trading entities).
    - Mission’s review suggests STATS SA approach is likely correct.
    - Recommendation: PSCC should identify municipal owned companies and their trading services (or quasi-corporations where separate companies do not exist) as public nonfinancial corporations and quasi-corporations (see GFSM 2014 §2.33).
  - Corporation for Deposit Insurance (CODI):
    - SARB had proposed classifying CODI as a public insurance corporation; mission recommended classifying CODI as a general government unit.
    - Financial protection schemes guidance (GFSM 2014 §2.132-2.135): schemes are classified inside general government when participation is compulsory, fees are out of proportion to service, or fees are not being set aside.
    - CODI participation is typically mandatory; recommendation is to classify CODI inside general (central) government sector.
    - IMF Statistics Department Financial Institutions Division shares view CODI should be classified inside general (central) government.

### Recommendations (summary and responsibilities)
- December 2024: Publish the statistical discrepancy between above and below the line measures of the deficit in the QB — Responsible: SARB.
- December 2024: Authorities are encouraged to prioritize the NT led project to map the national SCoA to GFSM 2014 — Responsible: NT, STATS SA, SARB.
- PSCC to review classification of borderline entities (RAF, PRASA, MINTEK, South African Nuclear Energy Corporation, TCTA, regional Water Boards, universities, municipal trading services, CODI) to ensure consistent classification across compilers and correct delineation of general government and public corporations.

*IMF | Technical Report – South Africa      Government Finance Statistics*

### 45.        Any reclassifications have the potential to impact the GFS data published by SARB, NT or

### 45.        Any reclassifications have the potential to impact the GFS data published by SARB, NT or

### Reclassifications — recommendations and timing
- Any reclassifications could impact the GFS data published by SARB, NT or STATS SA, and the GFS data provided to the IMF’s African and Statistics Departments.
- The mission did not discuss timescales for implementing revisions in detail; some revisions will be more technically challenging and may require adjustments to data collections.
- Mission recommendation on timing:
  - Aim to agree on simpler reclassifications by the end of 2023.
  - Carry out more difficult reviews in 2024, with changes to data implemented later.
  - Some classifications can be discussed during follow up technical assistance.

- Recommendations (all with Target Date: December 2024 unless otherwise stated):
  - Review the classification of the RAF, and reclassify as an EBI. — Responsible: PSCC
  - Review the classification of PRASA, and reclassify as an EBI from the appropriate point in time. — Responsible: PSCC
  - Review the classification of CODI, and classify as an EBI from its creation. — Responsible: PSCC
  - Review the classification of other nonfinancial corporations (e.g., Mintek, Water Boards) treated as part of the consolidated government by NT, and confirm the correct classification. — Responsible: PSCC/NT
  - Review the classification of municipal trading services and municipal owned companies, and where appropriate classify as public nonfinancial corporations and quasi-corporations. — Responsible: PSCC
  - Review the governance arrangements for universities and TVET colleges and confirm the basis for classification in the public sector. — Responsible: PSCC

### C. Specific Issues in Fiscal Data — background and scope
- The mission discussed additional issues where improvements can be made to fiscal data compilation and/or dissemination:
  - Recording of the transactions and balance sheet positions of the Road Accident Fund (RAF).
  - Recording of financial support being provided to ESKOM.
  - Recording of free basic services (water and electricity).
  - Improvements to the compilation of balance sheet data for public corporations to better align with statistical standards.
  - Incomplete recording of public financial corporations in SARB’s QB.
  - Presentational changes to some items in the current QB, and to the experimental public sector debt statistics.

### Recording of transactions and balance sheet positions for the RAF — findings
- Reclassification:
  - Important to reclassify RAF from the social security funds sub-sector to the extrabudgetary institutions sub-sector, but more important to correctly classify RAF’s transactions and balance sheet positions in GFS.
- Revenue classification:
  - Main revenue source, the fuel levy, should be classified as an excise tax (GFS code 1142).
  - Applying GFSM 2014 guidance on tax attribution (GFSM 2014 §5.33-5.34), the fuel levy should likely be classified as tax revenue for the national government and then transferred to RAF as a grant.
- Expenditure classification:
  - Payments of benefits by RAF should be recorded not as social security benefits, but as social assistance benefits, given RAF does not operate a social security scheme.
- Balance sheet and accounting changes:
  - RAF 2019-20 annual report: total liabilities of R332 billion (approximately 6 per cent of GDP), mostly current and non-current claims liabilities of R331 billion, subdivided into:
    - “liability for outstanding claims recorded” (OCR): R213 billion
    - “liability for claims incurred, but not yet reported” (IBNR): R103 billion
  - RAF latest financial statements (31 March 2022): total liabilities fell to R28 billion, or just 0.4 per cent of GDP, reflecting a new accounting policy that significantly reduced contingent liabilities.
  - Income statement impacts:
    - 2020 accounts showed a deficit for the year of R59 billion (1 per cent of GDP).
    - 2021 and 2022 accounts showed small surpluses.

- Table 2: RAF Revenue, Expenditure, Deficit and Liabilities 2018-19 to 2021-22 (R billion)
  - Total Revenue: 2018-19: 43.2; 2019-20: 41.2; 2020-21: 42.3; 2021-22: 48.2
  - Total Expenditure: 2018-19: 99.0; 2019-20: 100.9; 2020-21: 40.5; 2021-22: 47.8
  - Deficit for the year: 2018-19: (55.8); 2019-20: (59.6); 2020-21: 1.8; 2021-22: 0.4
  - Total Liabilities: 2018-19: 273.3; 2019-20: 321.7; 2020-21: 31.5; 2021-22: 27.7

- Compilation approaches and impacts:
  - SARB currently uses cash basis GFS compiled from cash flow statement.
  - Mission compiled indicative GFS from RAF financial statements on a cash and accrual basis for 2018-19 and 2019-20, and accrual-based GFS for 2020-21 and 2021-22. Results (Table 3) show large differences between cash and accrual approaches for earlier years, with material impact on South Africa’s general government fiscal accounts published by SARB, NT and STATS SA.

- Table 3: RAF GFS Data 2018-29- to 2021-22 (R billion)
  - Accrual Basis 2018-19:
    - 1 Revenue: 43.2
    - 2 Expense: 99.0
    - 31 Net Investment in nonfinancial assets: 0.0
    - NLB Net Lending / Borrowing (1-2-31): (55.8)
  - Accrual Basis 2019-20:
    - 1 Revenue: 41.2
    - 2 Expense: 100.9
    - 31 Net Investment in nonfinancial assets: 0.0
    - NLB Net Lending / Borrowing (1-2-31): (60.0)
  - Cash Basis 2018-19:
    - 1 Revenue: 42.0
    - 2 Expense: 42.6
    - 31 Net Investment in nonfinancial assets: 0.0
    - NLB Net Lending / Borrowing (1-2-31): (0.5)
  - Cash Basis 2019-20:
    - 1 Revenue: 42.7
    - 2 Expense: 42.2
    - 31 Net Investment in nonfinancial assets: 0.0
    - NLB Net Lending / Borrowing (1-2-31): (0.5)
  - Accrual Basis* 2020-21:
    - 1 Revenue: 42.3
    - 2 Expense: 40.5
    - 31 Net Investment in nonfinancial assets: 0.0
    - NLB Net Lending / Borrowing (1-2-31): 1.8
  - Accrual Basis* 2021-22:
    - 1 Revenue: 48.2
    - 2 Expense: 47.8
    - 31 Net Investment in nonfinancial assets: 0.0
    - NLB Net Lending / Borrowing (1-2-31): 0.4
  - Source: RAF Annual Reports for 2019-20 and 2021-22 and Mission Calculations
  - * New accounting basis

- Mission observations and statistical stance:
  - Under previous accounting, OCR and IBNR were estimated using assumptions and valued at net present value; methods resemble insurance technical reserves although RAF is not an insurance corporation.
  - As a general government unit, likely correct statistical approach is to record an account payable equal to the value of claims recorded (likely close to OCR), but not to include IBNR which resemble provisions or contingent liabilities.
  - Mission skeptical that RAF’s recent accounting approach and substantially lower claims liabilities are appropriate for fiscal statistics.
  - On a cash basis, RAF has run largely balanced budgets or modest surpluses/deficits; mission questioned whether cash accounting is appropriate for RAF and whether a modified cash approach might be better.
  - Further work in follow up missions needed to review RAF data, compile appropriate stocks and flows in South Africa’s GFS, and discuss with RAF and AGSA; adjustments may be contentious but fiscal impact on general government deficit and stock of debt (defined to include other accounts payable) could be very significant.

### Recording of financial support being provided to ESKOM — findings
- NT published Annexure W3 on ESKOM debt relief as part of the 2023 Budget Review outlining plans to relieve a portion of ESKOM’s unsustainable debt via advances from the government in the form of an interest free subordinated loan that would, provided conditions are met, be converted into equity.
- Mission guidance and classification:
  - During training the mission provided guidance on recording capital injections into public corporations using GFSM 2014 Chapter 6 and Appendix 3.
  - Meeting on August 10, 2024 (NT, SARB, STATS SA, mission, Acting IMF Mission Chief) discussed recording of the operation.
  - In the budget presentation (Annexure W2 Structure of the Government Accounts), the operation to assist ESKOM should likely be recorded above the line, within the category "payments for financial assets" as defined by NT (includes lending to or making equity investments in public corporations as well as debt takeovers for policy purposes). NT treats payments for financial assets as expensed rather than financing.
  - Mission confirmed GFSM 2014 treatment: record above the line.
- Key GFSM 2014 considerations:
  - When financing a public corporation in distress, key questions are whether government has an effective financial claim on the corporation (for loans) and whether a realistic return can be expected (for other injections).
  - For the ESKOM injection:
    - No effective claim for the loan as it is intended to be converted to equity rather than repaid.
    - Ex ante, a realistic rate of return is extremely unlikely given ESKOM’s longstanding financial and operational problems and erosion of its customer base.
  - Conclusion: operation should be recorded above the line as payments for financial assets under GFSM 2014.

### Recording of provision of free basic services — findings
- Free basic services provided to low-income households (water, sanitation, electricity, refuse removal) should be recorded as social benefits in South Africa’s GFS data.
- Specifics:
  - National policy provides free basic water (six kiloliters per poor household per month), energy (50 kilowatt-hours per month), and sanitation and refuse removal (based on service levels).
  - 2023 Budget Review, Annexure W1: local government receives the “local government equitable share” which accounts for costs of providing these basic services.
    - The amount of the equitable share for 2023/24 as a result of the need to provide basic services is shown as almost R71 billion — almost 23% of the total general government social benefits recorded by SARB in fiscal year 2021/2022.
- Recording complications:
  - Need to identify all flows that should be recorded. Transfers (presumably recorded as grants) exist between National Government and local government via the equitable share, but actual free services are presumably provided by municipal trading services discussed in Section B.
  - Desirable to separate trading services from wider local government in SARB’s GFS data.
  - Further work required in future technical assistance to fully identify and record the provision of free basic services in GFS.

### Improve compilation of balance sheet data for public corporations — findings
- SARB compiles and disseminates balance sheet data for public nonfinancial corporations and a subset of public financial corporations in the QB, using balance sheet data prepared under IFRS or SA GAAP.
- Key conceptual differences between accounting standards and macroeconomic statistics:
  - Provisions: recorded in IFRS/GAAP but generally not recorded in macroeconomic statistics (except in tightly defined circumstances).
    - Example: ESKOM’s 2022 Group Statement of Financial Position records provisions of almost R60 billion as liabilities.
  - Deferred tax assets and tax liabilities: may appear on corporate financial statements but in many cases need not be recorded in statistical balance sheets; government may not record corresponding liabilities or accounts receivable.
  - Preference shares: footnote indicates “ordinary and preference shares” in shares and other equity liabilities of public financial corporations, but preference shares are classified as a type of debt security (GFSM 2014 §7.150) because they pay fixed returns.
- Mission provided training on compiling GFS and balance sheet data from financial statements; authorities recognized adjustments will be required to align with statistical manuals.

### Incomplete reporting of public financial corporations in SARB's QB — findings and recommendation
- SARB’s QB includes data for general government, public nonfinancial corporations, and public financial corporations, but public financial corporations data is incomplete.
  - QB includes financial public enterprises such as the Industrial Development Corporation (IDC) of SA Ltd, but explicitly excludes SARB, Corporation for Public Deposits (CPD), the Land Bank and Postbank (excluded because covered in monetary statistical pages).
  - Exclusion leads to incomplete reporting and understates the size of the public financial corporations sector.
- Mission encouragement:
  - Authorities should expand reporting to include all public financial corporations, including SARB, CPD, Land Bank and Postbank.
  - Options: maintain existing tables and add separate tables for public deposit taking corporations and SARB, or compile revised tables providing data for all public financial corporations.

### Presentational changes — findings
- Minor inconsistencies in terminology noted in the QB.
- Major presentational change recommended for social security funds sub-sector balance sheets:
  - Current presentation shows total assets equal to total liabilities with substantial equity and investment fund shares liability (divided between reserves and retained earnings), and significant amounts of other accounts receivable (including accumulated deficit of RAF) — this is misleading.
  - Much of the recording error arises from RAF; reclassification of RAF outside social security funds and correct recording of RAF will address part of the issue.
  - Conceptual presentation of the social security funds sub-sector should be adjusted to be similar to local government balance sheet presentation — showing total assets equal to liabilities and net worth, without recording liabilities as equity and investment fund shares.

_Italic: IMF | Technical Report – South Africa Government Finance Statistics_

### 68.        More minor changes are to ensure terminology is fully aligned in the document. For example,

### tarea2024013 - 68. More minor changes are to ensure terminology is fully aligned in the document. For example,

### Terminology and balance sheet presentation
- Finding: The balance sheet presentation for financial public enterprises and corporations:
  - Refers to "debt securities" on the liabilities side.
  - Refers to "securities other than shares (as debt securities were known in GFSM 2001)" on the asset side.
- Recommendation: Ensure terminology is aligned across all the tables in the document so that the same terms are used consistently for instruments on assets and liabilities.

### Experimental public sector debt tables and instrument breakdowns
- Finding: SARB prepared experimental public sector debt tables included in the QB, presented in two tables that show:
  - (i) the debt of each of the different sub-sectors of the public sector (See figure 1);
  - (ii) total public debt broken by instrument.
- Mission suggestion: Add additional tables to show the instrument breakdown of debt by the main sub-sectors (probably the National Government, General Government, Nonfinancial and financial corporations), because the type of debt held by the different sub-sectors are very different.
- Note: The ISCG lists 14 different public financial corporations – 2 financial auxiliaries, 6 public sector financial intermediaries, 5 public sector non-life insurers and 1 public sector life insurer – it is not clear which of these are included in the data.

### Key recommendations, target dates, and responsible institutions
- December 2023
  - Record the ESKOM Bailout as a capital transfer, above the line, in line with GFSM 2014 guidance.
  - Responsible institutions: SARB / STATS SA / NT
- December 2024
  - Review the treatment of RAF transactions and balance sheet entries, and determine the correct treatment in fiscal statistics – include as a key topic in follow up TA Mission.
  - Responsible institutions: SARB, STATS SA, and NT
- December 2024
  - Revise the presentation of balance sheet data for the social security funds subsector to be in line with the local government presentation.
  - Responsible institution: SARB
- December 2024
  - Expand the presentation of experimental public sector debt to include instrument breakdowns by key sectors of the public sector.
  - Responsible institution: SARB
- December 2024
  - Expand the publication of data for public financial corporations to include all public financial corporations, including SARB, CPD, Land Bank and Post Bank.
  - Responsible institution: SARB
- December 2024
  - Revise balance sheet data for local governments and public corporations to ensure data is in line with statistical definitions of assets and liabilities.
  - Responsible institution: SARB

### Officials met during the mission (selected entries)
- South African Reserve Bank
  - Mr. Lesetja Kganyago — Governor
  - Mr. Kuben Naidoo — Deputy Governor
  - Mr. Michael Manamela — Head of Department, Economic Statistics Department
  - Ms. Susana Paulse — Senior Manager, Economic Statistics Department
  - Ms. Lisa De Beer — Lead Economist, Economic Statistics Department
  - Mr. Barend de Beer — Senior Manager, Economic Statistics Department
  - Ms. Akhona Mgwele — Senior Economist, Economic Statistics Department
  - Ms. Eldoret DeLange — Associate Economist, Economic Statistics Department
  - Mr. Victor Ramphele — Senior Economist, Economic Statistics Department
  - Ms. Tlhologelo Thoka — Economist, Economic Statistics Department
  - Ms. Theresa Gumbi — Economist, Economic Statistics Department
  - Ms. Mothwale Maboea — Economist, Economic Statistics Department
  - Ms. Vutlhari Mathe — Associate Economist, Economic Statistics Department
  - Ms. Vutomi Nkuna — Economist, Economic Statistics Department
  - Ms. Freelancia Pulutsoana — Junior Economist, Economic Statistics Department
  - Ms. Keitumetse Sathikge — Team Leader - Financial Reporting, Financial Services Department
  - Mr. Mahlatse Mdluli — Associate Economist, Economic Statistics Department
  - Mr. Kgomotso Thanwane — Economist, Economic Statistics Department
  - Mr. Gray Morai — Junior Economist, Economic Statistics Department
  - Ms. Keletso Morwane — Graduate, SARB Academy
  - Ms. Khumbudzo Muneri — Senior Economist, Economic Statistics Department
  - Ms. Lerato Enele — Economist, Economic Statistics Department
- Statistics South Africa
  - Ms. Elizabeth Makhafola — Director, Government Financial Statistics, National and Provincial Government Institutions
  - Ms. Nomvula Nobiya — Deputy Director: Economist, Government Financial Statistics, National and Provincial Government Institutions
  - Mr. Ephraim Mowa — Assistant Director: Economist, Government Financial Statistics, National and Provincial Government Institutions
  - Mr. Elvis Mulaudzi — Assistant Director: Economist, Government Financial Statistics, National and Provincial Government Institutions
  - Ms. Lerato Sindani — Assistant Director: Economist, Government Financial Statistics, National and Provincial Government Institutions
  - Mr. William Mello — Economist, Government Financial Statistics, National and Provincial Government Institutions
- National Treasury
  - Mr Edgar Sishi — Head, Budget Office
  - Mr. Hennie Swanepoel — Chief Director, Budget Office
  - Ms. Lindy Bodewig — Chief Director, Office of the Accountant General
  - Ms. Busi Motlhabedi — Chief Director, Budget Office Government Finance Statistics
  - Ms. Alice Mahlomotja — Director, Budget Office Government Finance Statistics
  - Ms. Tumi Tjale — Director, Budget Office Government Finance Statistics
  - Mr. Patrick Mbedzi — Deputy Director, Budget Office Government Finance Statistics
  - Ms. Kegomoditswe Setlhogo — Deputy Director, Budget Office Government Finance Statistics
  - Ms. Sebina Molise — Deputy Director, Budget Office Government Finance Statistics
  - Ms. Vanessa Parker — Deputy Director, Budget Office Government Finance Statistics
  - Mr. Vuyo Ngqukumba — Deputy Director, Budget Office Government Finance Statistics
  - Ms. Mokelane Ndaba — Deputy Director, Budget Office Government Finance Statistics
  - Ms. Takalani Rasalanavho — Deputy Director, Budget Office Government Finance Statistics
  - Ms. Kakanyo Mosikare — Director, Office of the Accountant General Technical Support Services
  - Ms. Moushumi Dullabh — Director, Office of the Accountant General Technical Support Services
  - Mr. Mthembisi Gama — Deputy Director, Office of the Accountant General Technical Support Services
  - Ms. Ledile Mello — Deputy Director, Office of the Accountant General Technical Support Services

### Appendix II — Stock-flow adjustments for 2022 Annual GFS submission (2018-2021)
- Financial Assets (R million)
  - Currency and deposits
    - Stock: 520 (2018), 566 (2019), 663 (2020), 670 (2021)
    - Transaction: -18 (2018), 27 (2019), 108 (2020), -53 (2021)
    - SFA: 19 (2018), -11 (2019), 60 (2020)
  - Debt securities
    - Stock: 46 (2018), 25 (2019), 9 (2020), 3 (2021)
    - Transaction: 0 (2018), -6 (2019), -41 (2020), 45 (2021)
    - SFA: -15 (2018), 25 (2019), -51 (2020)
  - Loans
    - Stock: 307 (2018), 449 (2019), 340 (2020), 332 (2021)
    - Transaction: 0 (2018), -3 (2019), 2 (2020), 2 (2021)
    - SFA: 145 (2018), -112 (2019), -9 (2020)
  - Equity and investment fund shares
    - Stock: 710 (2018), 711 (2019), 805 (2020), 797 (2021)
    - Transaction: 16 (2018), 7 (2019), 22 (2020), -6 (2021)
    - SFA: -7 (2018), 72 (2019), -2 (2020)
  - Insurance, pension, and standardized guarantee schemes
    - Stock: 169 (2018), 157 (2019), 214 (2020), 235 (2021)
    - Transaction: 0 (2018), 0 (2019), 1 (2020), 0 (2021)
    - SFA: -13 (2018), 56 (2019), 21 (2020)
  - Other accounts receivable
    - Stock: 389 (2018), 407 (2019), 418 (2020), 426 (2021)
    - Transaction: 25 (2018), 119 (2019), 99 (2020), 83 (2021)
    - SFA: -101 (2018), -88 (2019), -74 (2020)
- Liabilities (R million)
  - Currency and deposits
    - Stock: 0 (2018), 0 (2019), 0 (2020), 0 (2021)
    - Transaction: 0 (2018), 0 (2019), 0 (2020), 0 (2021)
    - SFA: 0 (2018), 0 (2019), 0 (2020)
  - Debt securities
    - Stock: 2,732 (2018), 3,178 (2019), 3,822 (2020), 4,059 (2021)
    - Transaction: 166 (2018), 297 (2019), 535 (2020), 196 (2021)
    - SFA: 148 (2018), 109 (2019), 42 (2020)
  - Loans
    - Stock: 83 (2018), 110 (2019), 171 (2020), 176 (2021)
    - Transaction: 24 (2018), 39 (2019), 71 (2020), 26 (2021)
    - SFA: -13 (2018), -9 (2019), -22 (2020)
  - Equity and investment fund shares
    - Stock: 0 (2018), 0 (2019), 0 (2020), 0 (2021)
    - Transaction: 79 (2018), 9 (2019), 125 (2020), 27 (2021)
    - SFA: -9 (2018), -125 (2019), -27 (2020)
  - Insurance, pension, and standardized guarantee schemes
    - Stock: 0 (2018), 0 (2019), 0 (2020), 0 (2021)
    - Transaction: 10 (2018), -4 (2019), 1 (2020), 0 (2021)
    - SFA: 4 (2018), -1 (2019), 0 (2020)
  - Other accounts receivable
    - Stock: 399 (2018), 433 (2019), 449 (2020), 447 (2021)
    - Transaction: 70 (2018), 150 (2019), 26 (2020), 114 (2021)
    - SFA: -116 (2018), -10 (2019), -117 (2020)

### Appendix III — Comparison of Consolidated General Government GFS between STATS SA and SARB, 2020/21 (R million)
- Revenue cash flows
  - Statistics SA: 1,564
  - SARB: 1,826
  - Differences: 262
- Itemized revenue components
  - 11 Taxes: Statistics SA 1,364; SARB 1,379; Differences 15
  - 12 Social contributions: 27; 27; 0
  - 13 Grants: 2; 2; -1
  - 14 Other receipts: 171; 419; 248
- Expense cash flows for operating activities
  - Total: Statistics SA 1,983; SARB 2,217; Differences 235
  - 21 Compensation of employees: 765; 802; 36
  - 22 Purchases of goods and services: 358; 512; 154
  - 23 Consumption of fixed capital: 0; 0; 0
  - 24 Interest: 247; 250; 3
  - 25 Subsidies: 26; 22; -4
  - 26 Grants: 71; 63; -8
  - 27 Social benefits: 335; 338; 3
  - 28 Other payments: 180; 230; 50
- Net cash flow from operating activities: -419 (Statistics SA), -391 (SARB), Differences 28
- Cash flows from investments in non-financial assets: -1 (Statistics SA), 113 (SARB), Differences 114
- Net cash inflow from financing activities: 662 (Statistics SA), 630 (SARB), Differences -32
- NET CHANGE IN THE STOCK OF CASH: 123 (Statistics SA), 69 (SARB), Differences -54

### Appendix IV — GFS Data for Road Accident Fund 2018-19 to 2021-22 (cash and accrual basis) (R million)
- Accrual Basis and Cash Basis reported values (selected lines)
  - 1 Revenue
    - Accrual Basis 2018-19: 43,239,323
    - Accrual Basis 2019-20: 41,240,480
    - Cash Basis 2018-19: 41,990,522
    - Cash Basis 2019-20: 42,699,184
    - Accrual Basis* 2020-21: 42,248,516
    - Accrual Basis* 2021-22: 48,154,678
  - 11 Taxes: 0 (all columns listed)
  - 12 Social contributions: 0 (all columns listed)
  - 13 Grants
    - Accrual Basis 2018-19: 43,138,770
    - Accrual Basis 2019-20: 41,177,671
    - Cash Basis 2018-19: 41,890,191
    - Cash Basis 2019-20: 42,632,836
    - Accrual Basis* 2020-21: 42,088,592
    - Accrual Basis* 2021-22: 47,931,888
  - 14 Other receipts
    - Accrual Basis 2018-19: 100,553
    - Accrual Basis 2019-20: 62,809
    - Cash Basis 2018-19: 100,331
    - Cash Basis 2019-20: 66,348
    - Accrual Basis* 2020-21: 159,924
    - Accrual Basis* 2021-22: 222,790
  - 2 Expense
    - Accrual Basis 2018-19: 99,018,733
    - Accrual Basis 2019-20: 100,864,358
    - Cash Basis 2018-19: 42,575,156
    - Cash Basis 2019-20: 42,231,756
    - Accrual Basis* 2020-21: 40,464,724
    - Accrual Basis* 2021-22: 47,756,820
  - 21 Compensation of employees
    - 1,735,302 (2018-19), 1,752,737 (2019-20), 1,735,302 (Cash 2018-19), 1,752,737 (Cash 2019-20), 1,941,244 (2020-21), 2,103,544 (2021-22)
  - 22 Purchases of goods and services
    - 515,183 (Accrual 2018-19), 534,456 (Accrual 2019-20), 733,891 (Cash 2018-19), 679,912 (Cash 2019-20), 530,020 (2020-21), 531,316 (2021-22)
  - 23 Consumption of fixed capital
    - 50,527 (Accrual 2018-19), 52,258 (Accrual 2019-20), 0 (Cash 2018-19), 0 (Cash 2019-20), 49,719 (2020-21), 44,836 (2021-22)
  - 24 Interest
    - 291,126 (Accrual 2018-19), 236,803 (Accrual 2019-20), 291,126 (Cash 2018-19), 236,803 (Cash 2019-20), 62,273 (2020-21), 119,089 (2021-22)
  - 27 Social benefits
    - 96,404,834 (Accrual 2018-19), 98,264,139 (Accrual 2019-20), 39,793,076 (Cash 2018-19), 39,538,609 (Cash 2019-20), 37,877,447 (2020-21), 44,952,695 (2021-22)
  - 28 Other payments
    - 21,761 (Accrual 2018-19), 23,965 (Accrual 2019-20), 21,761 (Cash 2018-19), 23,695 (Cash 2019-20), 4,021 (2020-21), 5,340 (2021-22)
  - 31 Net investments in non-financial assets
    - -26,099 (Accrual 2018-19), -74,553 (Accrual 2019-20), -23,704 (Cash 2018-19), 6,861 (Cash 2019-20)
  - NLB Net Lending / Net Borrowing
    - -55,779,410 (Accrual 2018-19), -59,597,779 (Accrual 2019-20), -510,081 (Cash 2018-19), 491,132 (Cash 2019-20), 1,783,792 (Accrual* 2020-21), 390,997 (Accrual* 2021-22)
- Source note: Source: RAF Annual Reports for 2019-20 and 2021-22 and Mission Calculations
- Annotation: Accrual Basis* indicates "New accounting basis"

*IMF | Technical Report – South Africa      Government Finance Statistics*

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_Source: https://www.imf.org/-/media/files/publications/tar/2024/english/tarea2024013.pdf_