ANNUAL PERFROMANCE PLAN 2013 – 2016

ANNUAL PERFROMANCE PLAN 2013 – 2016 REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

PRESENTATION OUTLINE • UPDATED SITUATIONAL ANALYSIS • ALIGNMENT OF GOVERNMENT WIDE PRIORITIES WITH EAAB ACTIVITIES • ORGANISATIONAL ENVIRONMENT • RELEVANT LEGISLATION APPLICABLE TO EAAB • EAAB MANDATE • TRANSFORMATION • OVERVIEW OF 2013 MTEF ESTIMATES • SUB PROGRAMME – COMPLIANCE • SUB PROGRAMME – EDUCATION AND TRAINING • SUB PROGRAMME – CORPORATE SERVICES • SUB PROGRAMME – FIDELITY FUND • MATERIALITY FRAMEWORK REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

UPDATED SITUATIONAL ANALYSIS • Performance Environment • Economic factors that impact Estate Agency growth: • Lower forecasted Economic growth • Higher anticipated inflation rate and interest rates. • Implementation of the National Credit Act • Scarcity of new developments • Stricter bank lending to property buyers • 8 million consumer with impaired credit records REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

UPDATED SITUATIONAL ANALYSIS • Performance Environment - Continued • Other factors that affect Estate Agents Industry: • Estate Agents may take advantage in the growing inexperienced property consumers. This may lead to higher claims made against Fidelity Fund. • Mismanagement of Trust fund has continued to be a challenge within the Industry. • The growing use of technology has impacted the practices of Property practices. REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

ALIGNMENT OF GOVERNMENT WIDE-PRIORITIES WITH EAAB ACTIVITIES REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

ALIGNMENT OF GOVERNMENT WIDE- PRIORITIES WITH EAAB ACTIVITIES REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

ALIGNMENT OF GOVERNMENT WIDE-PRIORITIES WITH EAAB ACTIVITIES REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

ORGANISATIONAL ENVIRONMENT Executive Authority Board of Directors Risk and Strategy Company Secretary Chief Executive Officer Internal Audit Fidelity Fund Executive Corporate services Executive Compliance Executive Inspections Executive Registrations Executive Education & Training REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

RELEVANT LEGISLATURE APPLICABLE TO EAAB • Legislative Mandates • The South African Constitution; Act 108 of 1996; • The Estate Agency Affairs Act, 112 of 1976; • The Public Finance Management Act, 1 of 1999; • The Preferential Procurement Framework Act of 2000; • The Financial Intelligence Centre Act, 38 of 2001; • The Labour Relations Act, 66 of 1995; • The SA Qualifications Authority Act, 58 of 1995; and • The Skills Development Act, 97 of 1998 • The Promotion of Administrative Justice Act 3 of 2000 • The Promotion of Access to Information Act 2 of 2000 • The National Credit Act 34 of 2005 • The Consumer Protection Act 68 of 2008 REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

EAAB MANDATE • Primary Mandate of EAAB • Regulate, maintain and promote the standard of conduct of estate agents having due regard to the public interest; • Issue fidelity fund certificates to qualifying applicants; • Prescribe the standard of training of estate agents; • Investigate complaints against estate agents and institute disciplinary proceedings against offending estate agents where required; and • Manage and control the Estate Agents Fidelity Fund. • Additionally to the primary mandate: • The EAAB is the Supervisory Body of the estate agency profession pursuant to the Financial Intelligence Centre Act and is obliged to take all steps required to prevent; alternatively, identify and report on, anti-money laundering and terrorist financing activities REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

TRANSFORMATION • One of the initiatives that has been discussed and agreed with the industry players is for each Estate Agency to recruit one potential Estate Agent from previously disadvantaged background. This individual will be put through a mentorship programme which will consist of the following: • Mentor assist the trainee in registration process as an intern • Train the intern in terms of the requirements set by EAAB, including compliance to Logbook checklist • Assist in the achievement of NQF Level 4 & 5 qualifications, including Professional designation examination. REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

TRANSFORMATION (Continued) • This initiative should be operated in partnership with Services Seta in order to assist EAAB with additional resources. The resourcing of the initiative will be as follows: • EAAB to fund the Education and Training of the trainee. i.e. Intern registration fees, NQF Level 4 & 5 education courses including the Professional Designation Examination. This should cost approximately R10,000 per trainee. There are `11,100 Estate Agencies. The total cost is R111 million. • Services Seta will provide an allowance to sustain the trainee during the internship period. Service Seta will reimburse the Estate Agencies for Education and Training related expenses. • The Estate Agencies will provide resources in respect of office space and equipment required for the trainee to perform his duties. REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

TRANSFORMATION – Current Statistics per Race REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

TRANSFORMATION – Current Statistics per Race (Continued) . REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

OVERVIEW OF 2013 BUDGET AND MTEF ESTIMATES • STATEMENT OF FINANCIAL POSITION - EAAB REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

OVERVIEW OF 2013 BUDGET AND MTEF ESTIMATES • STATEMENT OF FINANCIAL PERFORMANCE – EAAB (Refer to APP for Detail) REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

OVERVIEW OF 2013 BUDGET AND MTEF ESTIMATES • STATEMENT OF FINANCIAL PERFORMANCE – EAFF(Refer to APP for Detail) REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

SUB-PROGRAMME - COMPLIANCE • STRATEGIC OBJECTIVE • To improve compliance to the Estate Agency Affairs Act • STRATEGIES TO IMPROVE COMPLIANCE TO EAA Act • Implementation of on-line registration systems to improve registration turnaround times. • Implementation of on-line system to improve efficiency in resolving complaints. • Partnership with key stakeholders to restrict illegal Estate Agents performing property transactions without a valid FFC . • Set up of satellite offices in provinces to improve accessibility Nationally. REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

SUB-PROGRAMME - COMPLIANCE • STRATEGIES TO IMPROVE COMPLIANCE TO EAA Act (Continued) • Legislative amendments to the Property Transaction to increase EAAB powers in prosecutions • Effective inspections performed through implementation of in-house inspectorate. REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

COMPLIANCE PROGRAM PERFORMANCE INDICATORS REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

SUB-PROGRAMME – EDUCATION AND TRAINING • STRATEGIC OBJECTIVE • To build capacity of key stakeholders and professionalise the Estate Agency Sector • STRATEGIES TO BUILD CAPACITY OF KEY STAKEHOLDERS • Encouragement of RPL assessment Centre's to be registered and accredited by Department of Higher Education and Training institutions. • Increase the number of exam sittings in order to certify more candidates for NQF 4 and NQF 5 qualifications from 4 per annum to 8 per annum. • Implement the CPD programme for currently qualified Estate Agents. REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

EDUCATION AND TRAINING PROGRAM PERFORMANCE INDICATORS REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

SUB-PROGRAMME – CORPORATE SERVICES • STRATEGIC OBJECTIVE • To improve the effectiveness and efficiency of the EAAB. • To increase stakeholder awareness of the EAAB and its role and services. • STRATEGIES TO INCREASE STAKEHOLDER AWARENESS OF EAAB AND ITS ROLE AND SERVICES • Build capacity in order to perform more effective consumer campaigns. • STRATEGIES TO IMPROVE THE EFFECTIVENESS AND EFFICIENCY OF EAAB. • Implementation and providing support of IT initiatives to perform all major operations on-line. i.e. registrations, PDE and CPD applications, on-line tracking mechanisms for claims, disciplinary cases and audit reports submissions. REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

CORPORATE SERVICES PROGRAM PERFORMANCE INDICATORS REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

SUB-PROGRAMME – FIDELITY FUND • STRATEGIC OBJECTIVE • To effectively and efficiently control and manage the Fidelity Fund • strategies to improve efficiency and effectiveness of managing the fidelity fund. • EAAB has formed partnerships with key Stakeholders to improve the collection of Interest accrued to Fidelity Fund from Estate Agents Trust Funds. • The EAAB is improving liaison with the commercial crimes unit of the police service to improve the recovery of claims from Estate Agents. REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

FIDELITY FUND PROGRAM PERFORMANCE INDICATORS REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

MATERIALITY FRAMEWORK • Quantitative Materiality level is set at R60,501. • Qualitative aspects of materiality includes: • Unusual transactions entered into that are not of a repetitive nature and are disclosed purely due to the nature thereof due to knowledge thereof affecting the decision making of the user of the financial statements. • Transactions entered into that could result in reputational risk to the Estate Agency Affairs Board. • Any fraudulent or dishonest behavior of any officer or staff of Estate Agency Affairs Board. REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

MATERIALITY FRAMEWORK • Qualitative aspects of materiality includes (continued): • Procedures/processes required by legislation or regulation (e.g. PFMA and the Treasury Regulations). • Unauthorized, irregular or fruitless and wasteful expenditure. • Items of a non-financial nature, which would impact on the continued operation and deliverables of the Estate Agency Affairs Board. REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

THANK YOU REDRESSING THE PAST, BUILDING THE FUTURE, GUIDING THE REAL ESTATE INDUSTRY TOWARDS PROFESSIONALISM

ANNUAL PERFROMANCE PLAN 2013 – 2016