Annual reports are primarily intended, but not limited to address the information requirements of the PFMA and National Treasury’s Annual Report guidelines.
The purpose of this Annual Report Guide is to provide minimum requirements of information that must be included in a National or Provincial Department’s Annual Report. The Annual Report provides information of performance against plans and budgets.
Annual reports for private and public organisations are usually put together using a similar methodology (see below for an example). At the front of the report you will find a narrative overview of the past year's performance written by senior managers from the organisation.
Following the internationally accepted principles of integrated reporting, the report should also contain any relevant financial and other data, and a detailed explanation of the reporting methodology and how headline figures are calculated.
The City of Johannesburg's 2020/21 income statement, showing top line revenue and expenses
Usually this means the inclusion of the annual income statement, showing revenue and expenditure, and balance sheet, which shows the value of assets owned. Detailed expenditure per department may also be included, along with indicators relating to the Annual Performance Plan. While there may not be specific procurement data, the annual report is often the place to measure procurement impact: if targets and budgets were set aside to build a certain number of houses last year, did the department succeed?
Detail from the City of Johannesburg's 2021 Annual Report showing missed budget targets for household water provision. Not every organisation provides this detail in its annual report.
Submission of the annual report to the Auditor-General (AGSA)
The annual report must be submitted to the General (AGSA): the Auditor General by 31 May. The Auditor General will review the contents of the annual report to ensure that the content of the annual report is consistent with the annual financial statements.
A confirmation letter must be completed by the Accounting Officer to accept responsibility for the accuracy and fair presentation of the Annual Report including the information on predetermined objectives submitted to the AGSA and relevant treasury, and confirms that the Annual Report conforms to certain set guidelines.
Legislation: Section 40 of the PFMA and chapter 18 of the Treasury Regulations set out the legal requirements for departments’ annual reports PFMA.
Responsibilities and regulations highlighted in the PFMA;
Accounting officers’ reporting responsibilities
Treasury Regulations
Contents of annual reports [Section 40(1)(d) of the PFMA]
Additional annual reporting requirements for departments controlling trading entities, and public entities
