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Mangosuthu University of Technology Annual Report

19

WRITING-OFF OF ASSETS

Council considered and approved the proposal to write-

off assets with a cost of R7 326 089.99, an accumulated

depreciation of R7 173 344.07 and a net book value of

R162 742.92. The assets were no longer in use as reflected

in the presented schedule. They would be disposed of

by inviting three companies to view the items and make

offers on them. The disposal of assets written off would

be by sealed bids. The highest offer would be accepted.

WRITING-OFF OF MR MABASO’S DEBT

Council considered and approved the writing-off of the

debt of Mr Mabaso from the financial records as it was

unlikely that it would be recovered. After it is written-off,

the debt would be handed over to a debt collector to try

and recover it at an agreed commission percentage of the

funds recovered.

STUDENT DEBT

Council noted that the student debt was increasing every

year as a result of non-payment of fees. As at 31 December

2014, the student debt amounted to R125 million. About

60% of MUT students are funded by NSFAS. Inadequate

NSFAS funding contributes to the increase in the student

debt.

Council deliberated on the means to reduce the

escalating student debt and noted that in addition to

handing over the student debt for collection there are

mechanisms put in place by the University to compel

students to settle outstanding amounts, for example,

holding back certificates after students have completed

their qualifications. Council noted with concern that the

collection rate by Debt Tracker was low. Council requested

that a strategy on the student debt should be submitted

at the Council meeting in September 2015. Other options

besides Debt Tracker should be explored.

2015 SRC BUDGET

Council considered the recommendation for approval of

the 2015 SRC budget. In previous years the SRC budget

had not been submitted to Council for approval, but was

approved by the Finance Department. Council agreed that

a quarterly SRC budget should be presented to Council.

Council approved the 2015 SRC Budget amounting to R3

441 482.10.

2014 ANNUAL FINANCIAL STATEMENTS

Council considered and approved the unqualified

audit opinion on the 2014 Annual Financial Statements

as recommended at the joint meeting of the Finance

& Remuneration Committee and the Audit & Risk

Committee.

Council noted the Management Letter for the year ended

31 December 2014 as well as the Action Plan to address

issues raised in the 2014 External Auditors’ Management

Letter. The Action Plan indicated actions taken to resolve

issued raised.

APPOINTMENT OF PUBLIC OFFICER

Council considered and approved the appointment of the

CFO as the University official to correspond with SARS

regarding obtaining a tax clearance.

#FEES MUST FALL

Council received information regarding the fees must

fall Campaign: that the DHET had committed to pay

R39.540 million to MUT to cover the shortfall arising

out of the by government’s ‘No Fee Increase in 2016’

announcement, that Universities South Africa was working

on plans to manage some of the potential fallout from

the #FeesMustFall campaign at the beginning of 2016. As

part of this plan, Universities South Africa, together with

University Chairs of Council Forum, met with officials from

the DHET to discuss matters of common interest.

EXTENSION OF THE TERM OF THE INTERNAL

AUDITORS

Council considered and approved the extension of the

existing internal auditors’ contract upon expiry, for a

period of not more than three months, pending the

finalisation of the appointment of new internal auditors in

terms of the procurement process.

Edu-Loan Bank Account

Council was informed of how the Edu-Loan bank account

operates in providing loans to parents of students for

study purposes. The account would be opened with the

University’s bankers, ABSA. This is one of the strategies to

minimize the student debt. Council approved the opening

of a separate bank account for Edu-Loan transactions.

EXECUTIVE COMMITTEE OF COUNCIL

The Chairperson highlighted the following crucial issues

that members needed to think of strategies to deal with.

He proposed that these items be discussed at a special

Council meeting:

•

Annual Financial Statements;

•

Management Letter and issues raised by External

Auditors;

•

The Student debt – A detailed report on the student

debt to date and to provide an indication of the

extent to which the debt could be recovered;

•

The DBSA loan – Management should prepare a

business plan for the loan;

•

Financial stability and viability of the Institution;