Page 335 - SAMRC Annual Report 2024-2025

FINANCIAL INFORMATION

ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2025
NOTES TO THE ANNUAL FINANCIAL STATEMENTS

(CONTINUED)

41. Public Finance Management Act (PFMA)

Section 55 (2)
No material losses through criminal conduct were incurred during the period ended 31 March 2025. Irregular and
fruitless and wasteful expenditure incurred has been disclosed in note 39.
Section 54 (2)
In terms of the PFMA and Treasury Regulation 28.3 the entity has developed and agreed to a framework of
acceptable levels of materiality and significance.
42. Budget differences

Material differences between budget and actual amounts
Other non-tax revenue were higher than anticipated. Lower than anticipated external funding from contracts and
grants were received during the period under review. The decrease in external contracts and grant funding had a
material effect on the salaries and expenditure on goods and services which were much lower than anticipated.

The adjustment reflects the VAT which is allocated as a transfer and subsidies expense.The SACENDU grant and
funding for the Social Impact Bond (SIB) was included in the budgeted transfers received, but was allocated to
the sale of goods and services as this is managed as separate contracts.
43. Contingencies

Contingent liabilities
There are two high court claims by research trial participants. The matters will be defended. At this stage, the
outcome of the cases is unknown and it is not practical to estimate the financial effect of the claim.

The SAMRC will be applying to National Treasury to retain the accumulated surplus funds of R473,614,819 if
approved, the accumulated surplus funds will not have to be paid to National Treasury.

Contingent assets
In October 2017 and November 2017 the South African Revenue Service (SARS) re-assessed the September 2016
vat period. Output vat amounting to R2,824,561 was disallowed and interest and penalties were levied amounting
to R370,726 and R294,150 respectively. The amount of R3,492,222 was deducted from a refund due to SAMRC.
SAMRC has lodged a dispute with SARS for the disallowed output vat and the interest and penalties. The
output vat is valid and has been claimed in the 2021/2022 period. SAMRC anticipates to recover the interest and
penalties amounting R664,876 from SARS.
44. Going concern

The annual financial statements have been prepared on the basis of accounting policies applicable to a going
concern. This basis presumes that funds will be available to finance future operations and that the realisation of
assets and settlement of liabilities, contingent obligations and commitments will occur in the ordinary course
of business.

SAMRC ANNUAL REPOR T 2025-26 333