SSRA Annual Report 2013-14.pdf

1SSRA 2013/14 Annual Report SSRA 2013/14 Annual Report

Award for Effective Supervision

Through Technology

SSRA Board Chairman, Mr. Juma Muhimbi holding an award for Effective Supervision through Technology that was presented by the President of the International Social Security Association (ISSA), Mr. Errol Frank Stoové (right). The award was presented in Casablanca, Morocco during the ISSA Regional Social Security Forum for Africa in December 2014.

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Award for Best Workforce Focused

Organisation

SSRA staff in jubilation after the Authority received the ATE award for Best Workforce Focused Organisation

3SSRA 2013/14 Annual Report

Corporate Information

Social Security Regulatory Authority (SSRA)Plot No. 25, 2nd Floor, Alfa House, Bagamoyo Road,P.O.BOX 31846, Dar es Salaam.Tel: + 255 22 276 1683/4-9Fax: + 255 22 276 1681Email: info @ssra.go.tz or [email protected]: www.ssra.go.tz

PARENT MINISTRY

Ministry of Labour and Employment, P. O. Box 1422,Dar es Salaam, Tanzania.

BANKERSStanbic BankHead Office – Plot No. 99AAli Hassan Mwinyi/Kinondoni Road, P. O. Box 72647,Dar es Salaam, Tanzania

National Microfinance BankHead Office-NMB House,Azikiwe /Jamhuri Street,P.O. BOX 9213,Dar es Salaam, Tanzania.

CRDB Bank LimitedHead Office- Azikiwe Street, P.O. Box 268,Dar es Salaam, Tanzania

AUDITORSController and Auditor GeneralNational Audit Office,P.O. Box 9080,Dar es Salaam, Tanzania.

2 SSRA 2013/14 Annual Report

Award for Best Workforce Focused

Organisation

SSRA staff in jubilation after the Authority received the ATE award for Best Workforce Focused Organisation



Social Security Regulatory Authority (SSRA)Plot No. 25, 2nd Floor, Alfa House, Bagamoyo Road,P.O.BOX 31846, Dar es Salaam.Tel: + 255 22 276 1683/4-9Fax: + 255 22 276 1681Email: info @ssra.go.tz or [email protected]: www.ssra.go.tz

PARENT MINISTRY

Ministry of Labour and Employment, P. O. Box 1422,Dar es Salaam, Tanzania.

BANKERSStanbic BankHead Office – Plot No. 99AAli Hassan Mwinyi/Kinondoni Road, P. O. Box 72647,Dar es Salaam, Tanzania

National Microfinance BankHead Office-NMB House,Azikiwe /Jamhuri Street,P.O. BOX 9213,Dar es Salaam, Tanzania.

CRDB Bank LimitedHead Office- Azikiwe Street, P.O. Box 268,Dar es Salaam, Tanzania

AUDITORSController and Auditor GeneralNational Audit Office,P.O. Box 9080,Dar es Salaam, Tanzania.


ESTABLISHMENTSocial Security Regulatory Authority was established by Social Security (Regulatory Authority) Act No. 8 of 2008 as amended by Social Security Laws (Amendment) Act No. 5 of 2012

VISION“Tanzanians enjoying quality, extended and sustained social security services”

MISSION “To supervise and regulate Social Security Sector in order to ensure that quality social security services reach every Tanzanian”

CORE VALUES:In pursuing its roles and responsibilities Social Security Regulatory Authority observes the following core values.

IntegritySSRA will be consistent, fair and objective in dealings with all parties, demonstrating neither favour nor prejudice.

ProfessionalismSSRA is and will continue to be very professional and transparent in the implementation of the regulatory framework and in decision-making. SSRA will always provide sufficient reasons and relevant information to justify decisions and to ensure fairness.

Team workSSRA believes in team work. The Authority will build synergies and teamwork to promote and achieve its vision and strategic objectives.

InnovationHaving a strong and very dynamic team, SSRA will encourage innovation both in-house and in the sector in order to come up with both broad and specific products and services that meet the need of stakeholders. SSRA will always be ready to recognize innovators.

ConfidentialitySSRA believes in confidentiality of sensitive information from its Schemes, Custodians and Fund Managers and other stakeholders.

Customer Focused ServicesSSRA shall strive to know its customers and deliver services that customers are expecting. SSRA shall remain relevant to customers, alighning organizational capabilities to optimize relationship.



Authority: Unless otherwise specified shall mean the Social Security Regulatory Authority

Act: Means the Social Security (Regulatory Authority) Act, No. 8 of 2008 as amended by Social Security Laws (Amendments) Act No. 5 of 2012

Financial Statements: Means statements of Financial Position, Financial Performance, Cash Flows, Changes in Equity, a Summary of Significant Accounting Policies and other Explanatory Information.

Ministry: Unless otherwise specified shall mean the Ministry of Labour and Employment.

Definition of Terms


List of Abbreviations

ATE - Association of Tanzania EmployersBEST - Business & Entrepreneurs Support of TanzaniaBOT - Bank of TanzaniaCAG - Controller and Auditor GeneralCHODAWU - Conservation, Hotels, Domestic and Allied Workers’ Union CISNA - Committee of Insurance, Securities and Non-Banking Financial AuthoritiesCMPIC - Capital Markets, Pension and Insurance Committee of the East African Community DCR - Director of Compliance and RegistrationDG - Director GeneralDITF - Dar es Salaam International Trade FairEAC - East African CommunityEAPSA - East African Pension Supervisors Association ECASSA - East and Central Africa Social Security AssociationERM - Enterprise-wide Risk ManagementFSP - Financial Sector ProgrammeGEPF - GEPF Retirement Benefits FundICT - Information Communication TechnologyIOPS - International Organization for Pension SupervisorsIPSAS - International Public Sector Accounting StandardsISSA - International Social Security AssociationLAPF - LAPF Pensions FundMoU - Memorandum of UnderstandingNASCAP - National Anti-Corruption Strategy and Action PlanNBAA - National Board of Accountants and AuditorsNHIF - National Health Insurance FundNSSF - National Social Security FundPCCB - Prevention and Combating of Corruption BureauPPF - PPF Pensions FundPPRA - Public Procurement Regulatory Authority PSPF - Public Service Pensions FundSSRA - Social Security Regulatory Authority TUCTA - Trade Union Congress of Tanzania


Letter of Transmittal

Hon. Gaudentia M. Kabaka,Minister for Labour and Employment,P. O. Box 1422,Dar es Salaam.

Honorable Minister,

RE: THE ANNUAL REPORT OF THE SOCIAL SECURITY REGULATORY AUTHORITY FOR THE FINANCIAL YEAR 2013/2014

In accordance with Section 53 (1) of SSRA Act, No. 8 of 2008 as amended by Act No. 5 of 2012, I have the honor to submit, on behalf of the Board of Directors, the Annual Report of the Social Security Regulatory Authority for the financial year ended 30th June, 2014.

The report contains Chairperson’s Statement, Director General’s Statement and Audited Accounts of the Authority for the period ended 30th June, 2014.

I submit.

Mr. Juma A. MuhimbiBoard Chairman


List of Abbreviations

ATE - Association of Tanzania EmployersBEST - Business & Entrepreneurs Support of TanzaniaBOT - Bank of TanzaniaCAG - Controller and Auditor GeneralCHODAWU - Conservation, Hotels, Domestic and Allied Workers’ Union CISNA - Committee of Insurance, Securities and Non-Banking Financial AuthoritiesCMPIC - Capital Markets, Pension and Insurance Committee of the East African Community DCR - Director of Compliance and RegistrationDG - Director GeneralDITF - Dar es Salaam International Trade FairEAC - East African CommunityEAPSA - East African Pension Supervisors Association ECASSA - East and Central Africa Social Security AssociationERM - Enterprise-wide Risk ManagementFSP - Financial Sector ProgrammeGEPF - GEPF Retirement Benefits FundICT - Information Communication TechnologyIOPS - International Organization for Pension SupervisorsIPSAS - International Public Sector Accounting StandardsISSA - International Social Security AssociationLAPF - LAPF Pensions FundMoU - Memorandum of UnderstandingNASCAP - National Anti-Corruption Strategy and Action PlanNBAA - National Board of Accountants and AuditorsNHIF - National Health Insurance FundNSSF - National Social Security FundPCCB - Prevention and Combating of Corruption BureauPPF - PPF Pensions FundPPRA - Public Procurement Regulatory Authority PSPF - Public Service Pensions FundSSRA - Social Security Regulatory Authority TUCTA - Trade Union Congress of Tanzania



Hon. Gaudentia M. Kabaka,Minister for Labour and Employment,P. O. Box 1422,Dar es Salaam.

Honorable Minister,

RE: THE ANNUAL REPORT OF THE SOCIAL SECURITY REGULATORY AUTHORITY FOR THE FINANCIAL YEAR 2013/2014

In accordance with Section 53 (1) of SSRA Act, No. 8 of 2008 as amended by Act No. 5 of 2012, I have the honor to submit, on behalf of the Board of Directors, the Annual Report of the Social Security Regulatory Authority for the financial year ended 30th June, 2014.

The report contains Chairperson’s Statement, Director General’s Statement and Audited Accounts of the Authority for the period ended 30th June, 2014.

I submit.


SSRA 2013/14 Annual Report



CHAIRMAN’S STATEMENT

Mr. Juma A. Muhimbi

At the outset, I wish to express my appreciations to his Excellency, Dr. Jakaya Mrisho Kikwete, the President of the United Republic of Tanzania, for the trust and confidence he has bestowed on me when he appointed me the second Chairman of the Board of Directors of the Social Security Regulatory Authority. SSRA being a regulator for Social Security Sector is not only central to the economic development of Tanzania, but also a key player in the development and enhancement of Social Protection Floors for all Tanzanians. As such, I feel greatly honoured and indeed privileged to have been chosen among many equally qualifying and deserving Tanzanians to lead this institution and make it a respected regulator both within the country as well as in the international arena.

Since the leadership of my Board’s tenure commenced at a time when the first three years Strategic Plan (2010/11 to 2013/14) had ended and a new five years Strategic Plan 2014/15-2018/19 ushered in; I feel obliged to inter alia give account of the key achievements and challenges that the Authority went through during its first phase i.e. 2010/11 to 2013/14, as follows:

Major Achievements

1. Creation of a Conducive Social Security Legal and Regulatory Framework

During the first phase, the Authority coordinated review of the Social Security Regulatory Authority Act No. 8 of 2008 and the Social Security Schemes Acts that were then prevailing. These were reviewed and ammended through Social Security Laws (Amendements) Act No. 5 of 2012. The Authority also participated in the transformation of the Government Employees Provident Fund (GEPF) from a Provident Fund into a Pensions Fund.

Additionally, during the period under review, SSRA issued a total of 5 guidelines on different challenging regulatory areas.

2. Protection of Members’ Interests

On annual basis the Authority has been conducting onsite and offsite supervision activities to all registered Mandatory Social Security Schemes with a view to establish compliance


to the requirements of the laws and regulations governing the Social Security Sector. In addition, the Authority received and resolved about 400 complaints (annual average) from different stakeholders. The registered complaints mainly centred on delay in payment of benefits, unfair benefit computation formula, poor customer services from the Schemes and wrong calculations of benefits.

Furthermore, in protecting of members’ interests, SSRA has been monitoring financial sustainability and soundness of Social Security Schemes. During the implementation period the Authority conducted a comprehensive actuarial review of all registered Mandatory Social Security Schemes and conducted portfolio reviews of all investments of the Social Security Schemes. This formed a strong basis in coming up with some of the above mentioned guidelines.

3. Registration of Supplementary Schemes, Fund Managers and Custodians

During the period under review, SSRA registered six Mandatory Schemes, five Supplementary Schemes, eleven Fund Managers as well as eight Custodians.

4. Designing of the Social Security Reform Programme

In the process of realizing SSRA’s Mission and Vision in compliance with ILO declarations No. 102, and 202 on minimum benefits and Social Protection Floors, the Authority has drafted a comprehensive Social Security Reform Programme. The document was submitted to the Ministry of Labour and Employment (MoLE) for review and guidance. The suggested reform programme aims at revising and sustaining the national social security system in line with domestic and international benchmarks.

5. Extending Social Security Coverage

A number of efforts to increase coverage of social security in the country were adopted, including operationalization of the SSRA Act No. 8 of 2008 and Social Security Laws (Amendments) Act No. 5 of 2012 which for the first time paved way for inclusion of the informal sector in social security services. In addition the Authority prepared and put into operation a Strategy for Extension of Social Security Coverage. Efforts to introduce universal pension for senior citizens is also in good cause. As a result of the efforts exerted, the social security coverage has increased from 7% in 2010 to 9% of the labour force in June 2014.

6. Public Education and Awareness Programmes

Since its establishment, SSRA has embarked on extensive public education and awareness programmes targetting different groups such as desicion makers, social security members, workers, employers and the public at large. The public has been reached through, television and radio programmes, exhibitions and trade fairs, brochures and newspaper articles.

7. Financial Resources

To a large extent, operations of SSRA during the period were dependent on Government Subvention. The experience garnered during the periods (2010/11 and 2011/12) is that approved budgets were invariably way below the Authority’s respective proposed financial plans or budgets. In addition, disbursements of approved funds had been below the approved budgets . This situation strained the Authority’s operations quite significantly. However, as luck would have it, towards the end of 2012/13 financial year the Government machinery allowed SSRA to levy Social Security Schemes with a view to cover the Authority’s


operational budget. As far as financial management is concerned, SSRA has been keenly observing stipulated legal, financial and accounting requirements. This practice has enabled the Authority to receive clean audit reports from inception to the reporting date. In addition, SSRA was awarded by NBAA medals and certificates for being the first winner in 2012 and 2013 in the competition for best presented financial statements in the country.

8. Partnerships/Networks

In the aspect of public relations, SSRA has forged a very good working relationships with its key stakeholders that support its interventions. Such stakeholders include Social Partners, Social Security Schemes, Financial Sector Regulatory Authorities just to mention a few. Furthermore, SSRA is a member, and has actively participated in activities of regional and international social security organizations such as EAC, IOPS, CISNA, EAPSA and ECASSA. Lessons learnt from attending these forums have helped in preparing and designing the Universal Pension Scheme and Social Security Sector Reform Programme.During the period under review, the Social Security Sector has experienced notable progress in terms of various performance indicators as follows:

Social security coverage increased from 6.3% of the labour force in 2010 to 9% in 2014 . The membership size of the Schemes, including NHIF, has increased from 1.6 million members in 2010 to 1.95 million in June 2014 which is equivalent to a growth rate of 22%. The Net Assets of the Social Security Schemes increased by 85.4%, from TZS 4.1 trillion in June 2010 to TZS 7.6 trillion in June 2014. This is a reflection of the initiatives undertaken by the Schemes to increase members in various ways.

Challenges and Future Strategies

As stated in previous annual reports, the sector is still facing a number of challenges which need to be addressed in the future. One of the major challenges is the low level of coverage of the labour force; this has been attributed to by several factors including low awareness on Social Security issues among members of the public. The Authority is working closely with Schemes to ensure that public awareness programmes are expanded and reach all eligible citizens. Un-harmonized benefits formulas was another major challenge that the Sector encountered. I am happy to report that a cure to this chronic problem has been found. A harmonized formula was expected to be announced in the ensuing period and we hope this move will significantly reduce some of the problems relating to benefits.

As stated above, the Authority has continued to develop guidelines to increase effective operation of the Schemes and to ensure that members’ interests are adequately protected. Guidelines such as the Totalization of Contribution Periods which were issued in 2013, have contributed to a decline in members’ complaints, particulary those members who during their working life contributed to more than one Scheme for various reasons including change of employment, operational transfers by the employers, etc.

The Authority will continue to work hand in hand with stakeholders including Trade Unions, Employers’ Organizations and the Schemes to address other challenges such as inadequacy of benefits, low coverage and improved products across the sector.


Appreciation

I wish to express my sincere gratitude to the Minister of Labour and Employment, Honourable Gaudentia Mugosi Kabaka (MP), the Deputy Minister, Milton Makongoro Mahanga (MP) and the Permanent Secretary Mr. Eric F. Shitindi for their trust in my capability to lead the SSRA Board of Directors. In a very special way, I wish to thank and pay tribute to my predecessor, the late Mr. Siraju Juma Kaboyonga, his Vice Chairperson Mrs. Jayne Nyimbo and members of the first Board of Directors who ably led the Authority from its initial stage to a level where SSRA was virtually known to most Tanzanians and for their contribution towards ensuring that almost all stakeholders are aware of the fact that social security services is for all. This commitment is actually enshrined in the first Authority’s Strategic Plan for 2010/11-2013/14. My appreciation will not be complete without recognizing the tireless commitment and visionary and professional leadership of the current Board of Directors, Mrs. Irene Charles Isaka, the Director General, Management and Staff of SSRA. They have as a team, worked very hard towards realizing the Authority’s vision and mission. Last but not least, I wish to thank all our stakeholders for their enormous support throughout the existence of the Authority. There is no doubt that without their support, the Authority would not have been where it is now.


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The newly inaugurated

Board of Directors

The Minister of Labour and Employment, Hon Gaudentia Kabaka (sitting centre); Deputy Minister, Hon. Makongoro Mahanga (on her right) and the Permanent Secretary, Mr. Eric Shitindi (sitting on her extreme left) with the newly inaugurated Board of Directors of SSRA. Sitting on the Minister’s left is Mr. Juma Muhimbi and on her extreme right is Mrs. Irene Isaka. Standing from right: Ms. Jayne Nyimbo; Mr. Charles Chenza; Mr. Sylvester Mwakitalu; Mr. Saul Kinemela; Mr. Mchafu Chakoma; Mr. Jones Sikira; and Prof. Hamza Kiko.


THE BOARD OF DIRECTORS

OF THE SSRA

Mr. Juma A. Muhimbi

Board Chairman

Mr. Juma A. Muhimbi initially was appointed a non-executive Member of the SSRA Board of Directors on 13th September, 2010 as an expert in social security matters. In March 2014, Mr. Muhimbi was appointed the second SSRA Board of Directors Chairman. Mr. Muhimbi is self-employed and is the Managing Director of a private consulting company, IMMMA Consultancy Services Limited since 2002. From 1993 to 2001, he was the Director of Finance of the Parastatal Pensions Fund (PPF). Prior to joining PPF, he was a Senior Lecturer of the then Institute of Development Management (IDM) Mzumbe which is now Mzumbe University. Mr. Muhimbi has more than 22 years of experience in the Social Security Sector. He is an Auditor and Tax Consultant, a member of the National Board of Accountants and Auditors (NBAA), member of the Audit Committee of the Unit Trust of Tanzania (UTT), Muhimbili National Hospital and Ardhi University.

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The newly inaugurated

Board of Directors

The Minister of Labour and Employment, Hon Gaudentia Kabaka (sitting centre); Deputy Minister, Hon. Makongoro Mahanga (on her right) and the Permanent Secretary, Mr. Eric Shitindi (sitting on her extreme left) with the newly inaugurated Board of Directors of SSRA. Sitting on the Minister’s left is Mr. Juma Muhimbi and on her extreme right is Mrs. Irene Isaka. Standing from right: Ms. Jayne Nyimbo; Mr. Charles Chenza; Mr. Sylvester Mwakitalu; Mr. Saul Kinemela; Mr. Mchafu Chakoma; Mr. Jones Sikira; and Prof. Hamza Kiko.



OF THE SSRA

Mr. Juma A. Muhimbi

Board Chairman

Mr. Juma A. Muhimbi initially was appointed a non-executive Member of the SSRA Board of Directors on 13th September, 2010 as an expert in social security matters. In March 2014, Mr. Muhimbi was appointed the second SSRA Board of Directors Chairman. Mr. Muhimbi is self-employed and is the Managing Director of a private consulting company, IMMMA Consultancy Services Limited since 2002. From 1993 to 2001, he was the Director of Finance of the Parastatal Pensions Fund (PPF). Prior to joining PPF, he was a Senior Lecturer of the then Institute of Development Management (IDM) Mzumbe which is now Mzumbe University. Mr. Muhimbi has more than 22 years of experience in the Social Security Sector. He is an Auditor and Tax Consultant, a member of the National Board of Accountants and Auditors (NBAA), member of the Audit Committee of the Unit Trust of Tanzania (UTT), Muhimbili National Hospital and Ardhi University.

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Ms. Jayne NyimboBoard Vice Chairperson

Ms. Jayne Nyimbo joined SSRA as a Member of the Board of Directors in 2010 representing the Association of Tanzania Employers. In March 2014, Ms. Nyimbo was reappointed as SSRA Board Member and subsequently elected as the Vice Chairperson of the Board of Directors. Ms. Nyimbo has more than 20 years experience in the field of Human Resources Management. In addition, Ms. Nyimbo has served and still serves in other Boards of Directors including the following:

i) Vocational Education Training Authority as Board Member from July 2011 to date.

ii) Tanzania Private Sector Finance, Administration & Audit Board Committee Member.

iii) Tanzania Private Sector Board Member from March 2008 to March 2010.

iv) Executive Board Member with Tanga Cement Company Limited from 2007 to August 2010.

Mr. Mchafu ChakomaDirector

Mr. Mchafu Chakoma joined SSRA in 2010 as a Member of the Board of Directors representing Employees’ Organizations. In March 2014, Mr. Mchafu was reappointed to serve a second term as SSRA Board Member. He is a seasoned trade unionist and a long serving General Secretary of the Tanzania Seafarers Workers Union (TASU). Mr. Mchafu is a serving member of the Executive Committee-General Council and Congress of the Trade Unions Confederation of Tanzania (TUCTA), the Africa Vice- Chair (Inland Waters Navigation) of the International Transport Workers Federation (ITF-London), Seafarers and Dockers Fair Practice Committee Member of the International Transport Workers Federation (ITF-London). Mr. Mchafu is also a Board Member of the Seafarers Education Fund as well as the Wage Board (Seafarers and Fishing). 2010.

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Prof. Hamza Kiko

Director

Prof. Kiko Hamza is a Member of the Board of Directors representing Employees’ Organizations. Prof. Kiko is a serving member of the Executive Committee-General Council and Congress of the Trade Unions Confederation of Tanzania (TUCTA). He also serves as the National Chairman of Researchers, Academicians and Allied Workers Union (RAAWU). He is the Chairman of the Board of Tanzania Labour College (TLC), Advising Board Forest Industry Training Institute (FITI). Prof. Kiko is a Board member in Vocational Education Training Authority (VETA) and Institute of Adult Education (TEWW). Prof. Kiko holds a Phd since 2004 and is working with SUA, Morogoro

Mr. Saul KinemelaDirector

Mr. Saul Kinemela is the Labour Commissioner at the Ministry of Labour and Employment. He also serves as the Secretary to the Labour, Economic and Social Council (LESCO), a statutory body charged with advising the Government on Labour, Economic and Social Issues. Mr. Kinemela is a lawyer by profession. He is a long-serving high ranking judicial officer and a professional town planner.

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Ms. Jayne NyimboBoard Vice Chairperson

Ms. Jayne Nyimbo joined SSRA as a Member of the Board of Directors in 2010 representing the Association of Tanzania Employers. In March 2014, Ms. Nyimbo was reappointed as SSRA Board Member and subsequently elected as the Vice Chairperson of the Board of Directors. Ms. Nyimbo has more than 20 years experience in the field of Human Resources Management. In addition, Ms. Nyimbo has served and still serves in other Boards of Directors including the following:

i) Vocational Education Training Authority as Board Member from July 2011 to date.

ii) Tanzania Private Sector Finance, Administration & Audit Board Committee Member.

iii) Tanzania Private Sector Board Member from March 2008 to March 2010.

iv) Executive Board Member with Tanga Cement Company Limited from 2007 to August 2010.

Mr. Mchafu ChakomaDirector

Mr. Mchafu Chakoma joined SSRA in 2010 as a Member of the Board of Directors representing Employees’ Organizations. In March 2014, Mr. Mchafu was reappointed to serve a second term as SSRA Board Member. He is a seasoned trade unionist and a long serving General Secretary of the Tanzania Seafarers Workers Union (TASU). Mr. Mchafu is a serving member of the Executive Committee-General Council and Congress of the Trade Unions Confederation of Tanzania (TUCTA), the Africa Vice- Chair (Inland Waters Navigation) of the International Transport Workers Federation (ITF-London), Seafarers and Dockers Fair Practice Committee Member of the International Transport Workers Federation (ITF-London). Mr. Mchafu is also a Board Member of the Seafarers Education Fund as well as the Wage Board (Seafarers and Fishing). 2010.

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Prof. Hamza Kiko

Director

Prof. Kiko Hamza is a Member of the Board of Directors representing Employees’ Organizations. Prof. Kiko is a serving member of the Executive Committee-General Council and Congress of the Trade Unions Confederation of Tanzania (TUCTA). He also serves as the National Chairman of Researchers, Academicians and Allied Workers Union (RAAWU). He is the Chairman of the Board of Tanzania Labour College (TLC), Advising Board Forest Industry Training Institute (FITI). Prof. Kiko is a Board member in Vocational Education Training Authority (VETA) and Institute of Adult Education (TEWW). Prof. Kiko holds a Phd since 2004 and is working with SUA, Morogoro

Mr. Saul KinemelaDirector

Mr. Saul Kinemela is the Labour Commissioner at the Ministry of Labour and Employment. He also serves as the Secretary to the Labour, Economic and Social Council (LESCO), a statutory body charged with advising the Government on Labour, Economic and Social Issues. Mr. Kinemela is a lawyer by profession. He is a long-serving high ranking judicial officer and a professional town planner.

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Mr. Charles Chenza

Director

Mr. Charles M. Chenza is a Member of Board of Directors representing private sector. Mr Chenza has long serving experience in the Social Security Sector as a Director of Planning and Investments at Parastatal Pensions Fund, also served as a Senior Economist at Bank of Tanzania.

Mr. Sylvester Anthony Mwakitalu

Director

Mr. Sylvester Anthony Mwakitalu is a Member of the Board of Directors representing Attorney General’s Office. He is a State Attorney at Attorney General’s Chambers. He also serves as a part time tutor at Law School of Tanzania.

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Mr. Elias Mwakibinga

Director

Mr. Elias Mwakibinga is a Member of the Board of Directors representing Treasury Registrar’s Office. He is an Assistant Treasury Registrar and has at different times served as a Member of different Board of Directors various Government institutions including University of Dar es Salaam (UDSM), Institute of Finance Management (IFM), Public Service Pensions Fund (PSPF), Tanzania Telecommunications Company Limited (TTCL) and Commission for Science and Technology (COSTECH).

Mr. Jones Sikira

Director

Mr. Jones Sikira is a Member of the Board representing the Association of Tanzania Employers (ATE). Mr. Sikira is an experienced Human Resources and General Management Professional with more than 25 years of working and consultancy experience in these fields. He is a long serving Director of Human Resources with Unilever Tea Tanzania (formerly Brooke Bond). He currently serves as Executive Director of the Tea Association of Tanzania and also The Executive Secretary of Tea Research Institute of Tanzania.

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Mr. Charles Chenza

Director


Mr. Sylvester Anthony Mwakitalu

Director

Mr. Sylvester Anthony Mwakitalu is a Member of the Board of Directors representing Attorney General’s Office. He is a State Attorney at Attorney General’s Chambers. He also serves as a part time tutor at Law School of Tanzania.

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Mr. Elias Mwakibinga

Director

Mr. Elias Mwakibinga is a Member of the Board of Directors representing Treasury Registrar’s Office. He is an Assistant Treasury Registrar and has at different times served as a Member of different Board of Directors various Government institutions including University of Dar es Salaam (UDSM), Institute of Finance Management (IFM), Public Service Pensions Fund (PSPF), Tanzania Telecommunications Company Limited (TTCL) and Commission for Science and Technology (COSTECH).

Mr. Jones Sikira

Director


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Mrs. Irene C. IsakaBoard Secretary and Director General

Mrs. Irene C. lsaka was appointed as Director General and the founder of SSRA in 2010. She is the Secretary to the Board of Directors. Prior to joining SSRA, Mrs. lsaka worked with Stanbic Bank (T) as the Country Head of International Development Group (lOG), Non- Banking Financial Institution (NBFI) and Public Sector.

Mrs. lsaka has more than 14 years of working experience in Social Security Sector in different areas including Portfolio Management and Investment Management. Mrs. lsaka has worked as PPP advisor for Health Sector Programs for 35 councils throughout Tanzania.

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On behalf of the Management and Members of Staff of the Authority, I am humbled to present the performance of the Authority for the Financial Year 2013/2014. The report provides details of achievements made, challenges and the future look. 2013/14 was the last year of the first Authority’s Strategic Plan and I am delighted to report abundant success which was made possible through the efforts and commitment of the Authority’s Board of Directors, Management, Staff and other stakeholders. The following report presents the Authority’s achievements against each strategic objective for the year as stipulated in the SSRA Strategic Plan for 2011/12-2013/14.:

1. Financial Performance

The Authority during the 2013/14 Financial Year planned to spend TZS 10.84 billion for capital expenditure, personal emoluments and operational expenditure. As indicated on the Table 1, the Authority received from different sources a total of TZS 9.7 billion equivalent to 90% of the approved budget. Out of the total amount received, TZS 1.34 billion came from the Government as subvention in respect of salaries and statutory obligations, TZS 8.2 billion came from Social Security Schemes as levy revenue to cater for capital and operating expenditures. Further TZS 183 million were received from other sources. The Authority is very grateful to the Government of the Unite Republic of Tanzania and Social Security Schemes for their financial support.

Table1: Revenue Performance FY 2013/14

Revenue type Annual Income/ Expenditure (A)

Actual Income/ Expenditure (B)

Received revenue as % of budget

Government Subventions 2,629,228,800 1,341,070,000 -51.01%

Levy Income 8,211,114,521 8,232,642,182 100.26%

Other Income 183,823,827 100.00%

TOTAL REVENUE 10,840,343,321 9,757,536,009 90.01%

STATEMENT BY THE

DIRECTOR GENERAL

SSRA 2013/2014 PERFORMANCE REVIEW


Mrs. Irene C. IsakaBoard Secretary and Director General

Mrs. Irene C. lsaka was appointed as Director General and the founder of SSRA in 2010. She is the Secretary to the Board of Directors. Prior to joining SSRA, Mrs. lsaka worked with Stanbic Bank (T) as the Country Head of International Development Group (lOG), Non- Banking Financial Institution (NBFI) and Public Sector.

Mrs. lsaka has more than 14 years of working experience in Social Security Sector in different areas including Portfolio Management and Investment Management. Mrs. lsaka has worked as PPP advisor for Health Sector Programs for 35 councils throughout Tanzania.

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On behalf of the Management and Members of Staff of the Authority, I am humbled to present the performance of the Authority for the Financial Year 2013/2014. The report provides details of achievements made, challenges and the future look. 2013/14 was the last year of the first Authority’s Strategic Plan and I am delighted to report abundant success which was made possible through the efforts and commitment of the Authority’s Board of Directors, Management, Staff and other stakeholders. The following report presents the Authority’s achievements against each strategic objective for the year as stipulated in the SSRA Strategic Plan for 2011/12-2013/14.:

1. Financial Performance

The Authority during the 2013/14 Financial Year planned to spend TZS 10.84 billion for capital expenditure, personal emoluments and operational expenditure. As indicated on the Table 1, the Authority received from different sources a total of TZS 9.7 billion equivalent to 90% of the approved budget. Out of the total amount received, TZS 1.34 billion came from the Government as subvention in respect of salaries and statutory obligations, TZS 8.2 billion came from Social Security Schemes as levy revenue to cater for capital and operating expenditures. Further TZS 183 million were received from other sources. The Authority is very grateful to the Government of the Unite Republic of Tanzania and Social Security Schemes for their financial support.

Table1: Revenue Performance FY 2013/14

Revenue type Annual Income/ Expenditure (A)

Actual Income/ Expenditure (B)

Received revenue as % of budget

Government Subventions 2,629,228,800 1,341,070,000 -51.01%

Levy Income 8,211,114,521 8,232,642,182 100.26%

Other Income 183,823,827 100.00%

TOTAL REVENUE 10,840,343,321 9,757,536,009 90.01%

STATEMENT BY THE

DIRECTOR GENERAL

SSRA 2013/2014 PERFORMANCE REVIEW


2. Developing Conducive Legal and Regulatory Framework to Facilitate Faster Development of Social Security Sector in the Country

During the period under review the Authority continued with the efforts of strengthening legal and regulatory framework for the Sector through issuance of guidelines and regulations. During the year, three new guidelines and one amended guideline were issued as follows:

a) Social Security Schemes (Conduct of Annual Members’ Conference) Guidelines, 2014

The guidelines provide guidance on how annual members’ conferences should be organized and conducted. The aim being to give social security members opportunity to better understand and give comments on the operations of their respective Schemes.

b) Social Security Schemes ( Annual Reporting) Guidelines, 2014

The guidelines were issued essentially to supplement the reporting and disclosure requirements issued by the International Financial Reporting Standard Board by specifying additional disclosure matters which will enable social security members and other stakeholders to understand better the operation and performance of the Social Security Scheme.

c) Social Security Schemes (Interoperability) Guidelines, 2014

The guidelines are meant to provide a framework and connectivity mechanism between the registered Social Security Schemes and the Authority. It is expected to provide a platform through which information exchange between the Authority and registered Schemes will be enhanced.

d) Social Security Schemes (Totalization of Periods of Contributions) Guidelines, 2013 The instrument was amended during the year to address some of the practical challenges experienced

during its implementation. Following issuance of the instrument, members who have contributed to different Schemes are entitled to aggregate their periods of contributions for purposes of meeting the minimum benefit payments.

3. Sector Highlights

The Authority during FY 2013/2014 made considerable progress in expanding and improving the quality of social security services to Tanzanians. The performance of the Social Security Schemes is as shown below.

500,000

700,000

900,000

1,100,000

1,300,000

1,500,000

1,700,000

1,900,000

2,100,000

2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14

Membership of Schemes


-

500

1,000

1,500

2,000

2,500

2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14

Contributions (Billions)

-

200

400

600

800

1,000

1,200

1,400

1,600

2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14

Benefits Paid (Billions)

-

20,000

40,000

60,000

80,000

100,000

120,000

2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14

Number of Pensioners


-

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

2007/8 2008/9 2009/10 2010/11 2011/12 2012/13 2013/14

Investment Values (Billions)

Membership has increased from 1,856,245 in 2012/13 to1,951,751 in 2013/14. Total social security coverage in the Formal Sector as of June 2014 stood at the rate of 10% of working population. Total annual contributions have grown from TZS 1.63 trillion in 2013 to TZS 1.98 trillion in 2014, indicating a growth of 21%. This growth was higher than that of 2012/13 Financial Year (19%). Benefits payments have grown from TZS 1.06 trillion in 2012/13 to TZS 1.38 trillion in 2013/14 indicating a growth of 30%. This growth was smaller compared to the 2012/13 Financial Year growth of 46%. The number of pensioners has increased from 88,427 pensioners in 2012/13 to 97,425 pensioners in 2013/14, indicating a growth of 10% compared to the growth of previous year (22%). Investments of Social Security Schemes have grown from 5.65 trillion in 2012/13 to 6.7 trillion in 2013/14, equivalent to 18% annual growth.

4. Public Awareness

The Authority further, in efforts to extend social security coverage to include Informal Sector and promotion of social security services, conducted 57 educational seminars to different groups across the Sector i.e. Informal Sector, Government officials, members of Trade Unions and Employers Association; Workers Councils, Members of Parliament, SME groups where by more than 1,700,000 people were reached. A number of interviews, TV and radio programmes, exhibitions, have been implemented in dissemination of information, awareness creation and sensitization. Throughout the outreach programmes conducted during the year, the emphasis was placed in resolving challenges in the Social Security Sector through increasing awareness and facilitate innovation of products and services that target the Informal Sector. We believe this action will consequently increase coverage of Social Security Sector especially inclusion of Informal Sector.


Public Awareness Campaign

Meeting

Head of Public Relations and Promotions Unit Sarah Msika kibonde during public awareness campaign


5. National and International Cooperation and Partnerships

During the year, the Authority has continued implementing International Standards and best practices on regulations and supervision of the Social Security Sector. The Authority actively participated in nine (9) International and Regional Forums organized by IOPS, ECASSA CISNA, ISSA and ILO. According to EAC rules of procedures, SSRA is the current chair of the East African Pension Regulators Association (EAPSA). The association brings together EAC Securities and Pension Regulators in discussing and sharing regulatory experience and challenges experienced in their countries.

In addition, SSRA during the period strengthened its partnership with other Financial Sector Regulators in the Country i.e. Bank of Tanzania (BOT), Tanzania Insurance Regulatory Authority (TIRA), and Capital Markets and Securities Authority (CMSA). As a testament to the high esteem in which our work is held, the three regulators jointly hosted the 32nd Bi-Annual meeting of SADC Committee of Insurance, Securities and Non-Banking Financial Authorities (CISNA) in Tanzania from April 7th – 11th 2014. The meeting was attended by over 100 delegates and it focused mainly on exchange of regulatory experience, challenges and possibility of having a harmonized regulatory framework within SADC region.

Furthermore, in order to enhance cooperation with key stakeholders for the purposes of strengthening regulations and supervision of social security entities, the Authority during the FY 2013/14 signed three Memoranda of Understanding (MoU) with three national entities.

The first MoU was signed between the Authority and the National Audit Office on information sharing on matters of mutual interest. The second MoU was entered between SSRA and the National Bureau of Statistics on co-operation in the statistics related to Social Security Schemes and other matters of mutual interests. In addition SSRA, signed a multilateral MoU with other Financial Sector Regulators in Tanzania on financial stability. The objective of the MoU being to cooperate in enhancing and ensuring financial stability of the Financial Sector in Tanzania.

CISNA Meeting

SSRA Director General Mrs. Irene C. Isaka (center) during CISNA meeting in Dar es Salaam in April, 2014.On her right is Capital Markets and Securities Authority (CMSA) CEO Mrs. Nasama Massinda and on her left is CISNA Secretariat Ms. Anna Mang’anyi.


6. Registration of Schemes, Fund Managers and Custodians

In the year 2013/2014 the Authority registered four (4) Custodians; CRDB Bank plc, Stanbic Bank Ltd, Standard Chartered Bank Ltd and Bank M Tanzania Ltd. It also registered eight (8) Fund Managers including UTT-AMIS Public Co. Ltd, TSL Investment Management Ltd, Core Securities Ltd, Zan Securities Ltd, Exim Advisory Service Ltd, African Life Assurance (T) Ltd, Orbit Securities Ltd and E.A Capital Ltd. In addition the Authority registered one (1) Supplementary Scheme.

7. Supervision of the Social Security Sector

As our services grow in scope and size the number of complaints also increases. The Authority during the year received five hundred twenty eight (528) complaints from social security members and stakeholders. Five hundred and five (505) of these complaints were fully attended and closed, representing 96% closure rate. The Authority attended two hundred thirty eight (238) walk in members and responded to fifty five (55) calls from members on different matters pertaining to social security. With enhanced public awareness campaign, we look forward for reduced number of complaints.

Furthermore, the Authority conducted onsite inspection of four Schemes namely National Social Security Fund (NSSF), LAPF Pension Funds (LAPF), Public Service Pensions Fund (PSPF) and the National Health Insurance Fund (NHIF). The Authority also undertook continual offsite surveillance for all the six Mandatory Schemes. In both scenarios, the Schemes were found to be generally stable, financially sound and comply with the requirements set by the Authority.

8. Information Communication Technology

In order to promote effective ICT usage in the sector, the Authority started implementation of the Core Business Application (CBA) Project where seven modules were completed and put in use. These include Electronic Services Portal, Case Management Modules, Document Management and Workflow Module, Complaints Management Module, Registration and Compliance Module, Payroll and Staff Self-service HR System, Overtime Module and Flight Booking Module. In addition Hifadhi ya Jamii and Social Security Systems web pages for public awareness went live during the period. We plan to continue with Core Business Application Project in order to enhance the Authority’s ICT capacity to cope with rapid technological change and adhering to international standards and best practices.

9. Human Resources Management

In enhancing employee’s technical and soft skills, during the period under review, a number of trainings including long, short and tailor made courses were conducted to both Board Members and Staff. The conducted training, seminars and workshops mainly centered on areas of Social Security, Governance, Accounting, Leadership, Actuarial, ICT and Customer Services. Apart from structured capacity building programmes, the Authority also made it possible for all staff to participate in inhouse awareness sessions held every Monday. Indeed, the built human capital capacity enabled the Authority to provide better services to the Sector and public in general.

As part of our efforts to address shortage of professionals and strengthen Human Resources, the Authority in collaboration with Public Service Recruitment Secretariat (PSRS), initiated a recruitment process for nineteen (19) staff to fill various vacant posts in the Authority.

In recognition of SSRA’s commitments and dedications to being employer of choice, the Authority was recognized and awarded a trophy for emerging as Best Employer of the Year (EOY) under Work Focused


Category. The competition is run annually by the Association of Tanzania Employers (ATE). This award and the one obtained from NBAA i.e. Regulatory Authority with best presented Financial Statements under IPSAS, speaks loudly about our commitment to excellence.

10. Efficient System for Financial Management

The Authority during the year prepared and rolled out the second five years Strategic Plan for 2014/15-2018/19. The new SSRA Strategic Plan is a compass which indicates the Authority’s direction for reaching its mission of “ensuring quality social security services reaches every Tanzanian.”

The financial resources at the disposal of the Authority have continued to be managed prudently and in compliance with the set regulations and procedures. This is reflected in the Controller and Auditor General’s audit opinion which forms part of this document. In this regard, the Authority during the year prepared and tabled before CAG for auditing purpose, the Authority’s Financial Statements for the year ended 30th June, 2014. The External Auditors (CAG) issued for the fourth time a clean audit opinion on the Financial Statements of the Authority. I am pleased to report further that SSRA, during the year 2014 Accountants and Auditors’ Annual Conference held in Arusha, was named for the second time in a row by the National Board of Accountants and Auditors as the first winner of the Best Presented Financial Statements under IPSAS category.

11. HIV/AIDS Policy

SSRA puts a lot of emphasis on HIV and AIDS matters. During the year in consideration, one sensitization seminar on the dangers and impact of HIV and AIDS was held where 31 staff participated. Efforts were also put on protection and prevention of HIV and AIDS to its staff whereby HIV and AIDS protections gears were made available to staff and visitors throughout the year. As it is the case in the National HIV/AIDS Policy, no member of staff has been and will be discriminated due to his/ her HIV/AIDS status.

12. Employee’s Welfare

The total number of employees during the year in consideration was 45 out of these 27 were males and 18 were females. The number includes 18 staff who are on short term contractual terms. The relationship between the employees and Management is sound and there were no unresolved complaints received by Management from employees during the year. As way of involving SSRA staff in work related decision making, SSRA Workers’ Council was established and was launched by Hon Gaudentia Kabaka (MP) Minister for Labour and Employment on February 6th 2014.

13. Anti-Corruption

In conducting its activities, SSRA maintains transparency and observes its core values and principles of good governance. The Authority, during the year conducted one seminar on the SSRA Code of Ethics and role of staff in the fight against corruption. The seminar was conducted in collaboration with PCCB and was attended by 38 staff. In addition, the Authority during the year established an Ethics Committee responsible for handling unethical issues including corruption. SSRA has established Tender Board and Procurement Management Unit, organs which ensure that transparency prevails in all procurement transactions.

14. Risk Management

The Authority recognizes that risk is an integral component of its daily operations and carefully considers the


level of risk it is prepared to tolerate. The Authority fosters a risk-awareness corporate culture in all decision making, and is committed to managing all risk in a proactive and effective manner through competent risk management. To support this commitment, risk is analyzed in order to inform the management decisions taken at all levels within the organization. The principles of the risk analysis and management process are set out in the Risk Policy.

The Risk Policy is supported by an integrated Risk Management Framework of risk governance and reporting specifying how the Authority organizes and handles enterprise wide risks. Together with the Policy, the Framework provides an ongoing process for identifying, evaluating and managing the significant risks faced by the Authority. Clear accountability for risk management is defined throughout the Authority and is a key performance area of line managers.

15. Challenges and Future Strategies

Apart from the named achievements, there are still some challenges in the sector which need to be addressed. Some of the challenges encountered are, low social security coverage especially of the informal sector, inadequate benefits and low awareness on social security products and services. In future, the Authority will continue working on the existing challenges as well as implementing new strategic objectives and activities with the view to achieve its vision and mission.

16. Appreciation

The achievements of the Authority during this year have been possible through the tremendous support received from our key stakeholders including the President’s Office, the Prime Minister’s Office, Ministry of Labour and Employment, Ministry of Finance, Bank of Tanzania, Attorney General’s Chambers, the Controller and Auditor General’s Office, Trade Union Congress of Tanzania, Association of Tanzania Employers, Social Security Schemes, Media Houses and the development partners like the World Bank and International Labour Organization.

I wish to recognize the continuous professional guidance from the Board of Directors under the leadership of the Chairman Mr. Juma Muhimbi. Indeed, the Board has been instrumental to the achievement made to-date. Last but not least, special appreciation to the Management and Members of Staff of the Authority for their dedication and perseverance to see to it that the Authority achieves its strategic objectives.

Once again, I would like to assure our stakeholders and particularly the Social Security Scheme members whom we have been established to look after their interests, that SSRA has a great platform for the future and has established strong capabilities and operational path for the execution of its strategic objectives for the benefit of members, stakeholders and the public at large.

Thank you very much,

Mrs. Irene C. IsakaDirector GeneralSocial Security Regulatory Authority (SSRA)


SSRA MANAGEMENT

Mrs. Irene C. Isaka

Director General

Academic qualifications: Masters Degree in Economics from the University of Dar es Salaam specializing in Econometrics and Monetary Economics.

Irene has held the position of Director General of SSRA since its inception in 2010. Prior to joining SSRA, Irene worked with Stanbic Bank (T) Ltd. as the Country Head of International Development Group (IDG), Non-Banking Financial Institutions (NBFIs) and the Public Sector. She has also worked for a number of years in the arena of pension investments with stints at the National Social Security Fund and the PPF Pensions Fund. She has also worked in the health sector as Public Private Partnership (PPP) Advisor to 35 councils in the mainland Tanzania.

She has Master’s Degree of Economics specialising in Econometrics and Monetary Economics. She has a Bachelor degree in Economics specializing in Industrial Economics, a post graduate Diploma in Pension Fund Investments, a diploma in Risk Management for Investment of Pension Funds and a diploma in Housing Finance. Irene has been a trailblazer in pensions reform in Tanzania and continues to work tirelessly to ensure a soundly regulated pensions sector.

..............................................................................


..............................................................................

..............................................................................Mr. Ansgar A. Mushi

Director of Research, Actuarialand Policy Development

Academic qualifications: Masters of Science in Social Protection Financing (SPF), Post-graduate Diploma in Financial Management and an Advanced-Diploma in Social Security Administration;

Mr. Mushi joined SSRA in July, 2011 as the Director of Research, Actuarial and Policy Development. Prior to joining SSRA, Mr. Mushi was the National Project Coordinator - Social Protection with the ILO Area Office in Dar es Salaam. He was a Technical Officer responsible for advising ILO partners (Government, Workers and Employers) on social security and policy issues, coordinating, organizing and implementing social security/protection project activities. Mr. Mushi also served as a lecturer in Social Security Administration, Actuarial Practices in Social Security Schemes and Financing of Social Security Schemes at the Institute of Finance Management for nine years.

Mr. Mohamed A. NyasamaDirector of Finance Planning and

Human Resource Management

Academic qualifications: Masters of Science in Accounting and Finance, Bachelor of Commerce in Accounting and he is a Certified Public Accountant [CPA (T)].

Mr. Nyasama joined SSRA in September, 2011 as Director of Finance Planning and Human Resource Management. Prior to joining SSRA, he was the Manager for Market Development of the Capital Market and Securities Authority (CMSA). He also worked as Manager Market Supervision at CMSA, Manager Planning, Budgeting and Forecasting at the Tanzania Cigarette Company Limited (TCC). Mr. Nyasama was also a lecturer at the Institute of Finance Management (IFM) and is registered with the National Board of Accountants and Auditors (NBAA) as an Associate Certified Public Accountant (ACPA). He has more than 19 years of experience in development and supervision of Financial Sector in Tanzania.


SSRA MANAGEMENT

Mrs. Irene C. Isaka

Director General

Academic qualifications: Masters Degree in Economics from the University of Dar es Salaam specializing in Econometrics and Monetary Economics.

Irene has held the position of Director General of SSRA since its inception in 2010. Prior to joining SSRA, Irene worked with Stanbic Bank (T) Ltd. as the Country Head of International Development Group (IDG), Non-Banking Financial Institutions (NBFIs) and the Public Sector. She has also worked for a number of years in the arena of pension investments with stints at the National Social Security Fund and the PPF Pensions Fund. She has also worked in the health sector as Public Private Partnership (PPP) Advisor to 35 councils in the mainland Tanzania.

She has Master’s Degree of Economics specialising in Econometrics and Monetary Economics. She has a Bachelor degree in Economics specializing in Industrial Economics, a post graduate Diploma in Pension Fund Investments, a diploma in Risk Management for Investment of Pension Funds and a diploma in Housing Finance. Irene has been a trailblazer in pensions reform in Tanzania and continues to work tirelessly to ensure a soundly regulated pensions sector.

..............................................................................


..............................................................................

..............................................................................Mr. Ansgar A. Mushi

Director of Research, Actuarialand Policy Development

Academic qualifications: Masters of Science in Social Protection Financing (SPF), Post-graduate Diploma in Financial Management and an Advanced-Diploma in Social Security Administration;

Mr. Mushi joined SSRA in July, 2011 as the Director of Research, Actuarial and Policy Development. Prior to joining SSRA, Mr. Mushi was the National Project Coordinator - Social Protection with the ILO Area Office in Dar es Salaam. He was a Technical Officer responsible for advising ILO partners (Government, Workers and Employers) on social security and policy issues, coordinating, organizing and implementing social security/protection project activities. Mr. Mushi also served as a lecturer in Social Security Administration, Actuarial Practices in Social Security Schemes and Financing of Social Security Schemes at the Institute of Finance Management for nine years.

............................................................................................................................................................

Mr. Mohamed A. NyasamaDirector of Finance Planning and

Human Resource Management

Academic qualifications: Masters of Science in Accounting and Finance, Bachelor of Commerce in Accounting and he is a Certified Public Accountant [CPA (T)].

Mr. Nyasama joined SSRA in September, 2011 as Director of Finance Planning and Human Resource Management. Prior to joining SSRA, he was the Manager for Market Development of the Capital Market and Securities Authority (CMSA). He also worked as Manager Market Supervision at CMSA, Manager Planning, Budgeting and Forecasting at the Tanzania Cigarette Company Limited (TCC). Mr. Nyasama was also a lecturer at the Institute of Finance Management (IFM) and is registered with the National Board of Accountants and Auditors (NBAA) as an Associate Certified Public Accountant (ACPA). He has more than 19 years of experience in development and supervision of Financial Sector in Tanzania.

.............................................................................. ..............................................................................


..............................................................................

..............................................................................Dr. Carina Wangwe

Head of Management Information Systems Unit

Academic qualifications: PhD (Information Security for e-Government), Masters of Science in Computer Science, CGEIT and CISM;

Dr. Wangwe joined SSRA in July 2011, as Head of Management Information Systems Unit. Prior to joining SSRA she worked for nine years as Director, Information Systems at PPF Pensions Fund. Dr. Wangwe has twenty years of experience in project management, service delivery and ICT governance.

............................................................................................................................................................

Ms. Lightness Mauki

Director of Compliance and Registration

Academic qualifications: Masters of Business Administration in Finance and Bachelor of Commerce;

Ms. Mauki joined SSRA in July 2011, as the Director of Compliance and Registration. Prior to joining SSRA she worked for Stanbic Bank Tanzania Limited as a Country Head of Compliance & Risk Management. Ms. Mauki has eleven years of experience in the field of Regulatory Compliance and Risk Management.

.............................................................................. ..............................................................................


Mr. Peter Mbelwa

Head of Internal Audit Unit

Academic qualifications: Masters of Science in Finance, CPA (T), CISA and ADCA.

Mr. Mbelwa joined SSRA in July 2011 as the Head of Internal Audit. Mr. Peter Mbelwa is an experienced professional Accountant specializing in Internal Auditing. He is the Chief Internal Auditor of Social Security Regulatory Authority, with seasoned and successful experience of over 18 years. He is a member of the National Board of Accountants and Auditors (NBAA), where he is registered in the category of Associate Certified Public Accountant since 2004. Mr Mbelwa holds MSc-Finance from Strathclyde University.

Ms. Sarah Kibonde Msika

Head of Public Relations and Promotions Unit

Academic qualifications: Masters of Business Administration in Marketing, Bachelor of Commerce in Marketing (Hons) Ms. Msika joined SSRA in July 2011, as Head of Public Relations and Promotions. Prior to joining SSRA she worked for seven years at PPF Pensions Fund, among which four years she was a Public Relations Manager. Ms. Msika has twelve years of work experience in Social Security Industry in the field of marketing, public relations and promotions.

..............................................................................

..............................................................................


..............................................................................

..............................................................................Dr. Carina Wangwe

Head of Management Information Systems Unit

Academic qualifications: PhD (Information Security for e-Government), Masters of Science in Computer Science, CGEIT and CISM;

Dr. Wangwe joined SSRA in July 2011, as Head of Management Information Systems Unit. Prior to joining SSRA she worked for nine years as Director, Information Systems at PPF Pensions Fund. Dr. Wangwe has twenty years of experience in project management, service delivery and ICT governance.

Ms. Lightness Mauki

Director of Compliance and Registration

Academic qualifications: Masters of Business Administration in Finance and Bachelor of Commerce;

Ms. Mauki joined SSRA in July 2011, as the Director of Compliance and Registration. Prior to joining SSRA she worked for Stanbic Bank Tanzania Limited as a Country Head of Compliance & Risk Management. Ms. Mauki has eleven years of experience in the field of Regulatory Compliance and Risk Management.


Mr. Peter Mbelwa

Head of Internal Audit Unit

Academic qualifications: Masters of Science in Finance, CPA (T), CISA and ADCA.

Mr. Mbelwa joined SSRA in July 2011 as the Head of Internal Audit. Mr. Peter Mbelwa is an experienced professional Accountant specializing in Internal Auditing. He is the Chief Internal Auditor of Social Security Regulatory Authority, with seasoned and successful experience of over 18 years. He is a member of the National Board of Accountants and Auditors (NBAA), where he is registered in the category of Associate Certified Public Accountant since 2004. Mr Mbelwa holds MSc-Finance from Strathclyde University.

SSRA 2013/14 Annual Report SSRA 2013/14 Annual Report

Ms. Sarah Kibonde Msika

Head of Public Relations and Promotions Unit

Academic qualifications: Masters of Business Administration in Marketing, Bachelor of Commerce in Marketing (Hons) Ms. Msika joined SSRA in July 2011, as Head of Public Relations and Promotions. Prior to joining SSRA she worked for seven years at PPF Pensions Fund, among which four years she was a Public Relations Manager. Ms. Msika has twelve years of work experience in Social Security Industry in the field of marketing, public relations and promotions.

..............................................................................

..............................................................................


Mr. Emmanuel M. Urembo

Head of Procurement Management Unit

Academic qualifications: Masters of Business Administration in Corporate Management from Mzumbe University, CPSP (PSPTB), ADPS (Hons) Tanzania Institute of Accountancy and CIPP (IAPM)

Mr. Urembo joined SSRA in July, 2011 as Head of Procurement Management Unit. Prior to joining SSRA, he worked as the Principal Supplies Officer of the Ministry of Labour and Employment and Ministry of Finance. He has over twenty years of experience in the field of Public Procurement System and Donor Funded Projects.

..........................................................................................................................................................................................................................................

Mr. Ngabo Patrick Ibrahimu

Director of Legal Services

Academic qualifications: Masters of Laws (LLM), and Bachelor of Laws (LLB)

Mr. Ibrahimu joined SSRA in July, 2011 as Director of Legal Services. Prior to joining SSRA, he was the Legal Services Manager and Head of the Legal Services Unit of the Public Services Pensions Fund. He also worked as a State Attorney in the Ministry of Finance and Economic Affairs. He has more than fifteen years of experience in the Social Security Sector. Mr. Ibrahimu is an Advocate of the High Court of Tanzania and subordinate courts thereto. He also serves as a non-executive Director of the National Organization for Legal Assistance (NOLA) as well as the Institute of Public Policy and Law (IPPL).

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SSRA

MAN

AGEM

ENT

TEAM


Mr. Emmanuel M. Urembo

Head of Procurement Management Unit

Academic qualifications: Masters of Business Administration in Corporate Management from Mzumbe University, CPSP (PSPTB), ADPS (Hons) Tanzania Institute of Accountancy and CIPP (IAPM)

Mr. Urembo joined SSRA in July, 2011 as Head of Procurement Management Unit. Prior to joining SSRA, he worked as the Principal Supplies Officer of the Ministry of Labour and Employment and Ministry of Finance. He has over twenty years of experience in the field of Public Procurement System and Donor Funded Projects.

..............................................................................

Mr. Ngabo Patrick Ibrahimu

Director of Legal Services

Academic qualifications: Masters of Laws (LLM), and Bachelor of Laws (LLB)

Mr. Ibrahimu joined SSRA in July, 2011 as Director of Legal Services. Prior to joining SSRA, he was the Legal Services Manager and Head of the Legal Services Unit of the Public Services Pensions Fund. He also worked as a State Attorney in the Ministry of Finance and Economic Affairs. He has more than fifteen years of experience in the Social Security Sector. Mr. Ibrahimu is an Advocate of the High Court of Tanzania and subordinate courts thereto. He also serves as a non-executive Director of the National Organization for Legal Assistance (NOLA) as well as the Institute of Public Policy and Law (IPPL).

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33SSRA 2013/14 Annual Report 33SSRA 2013/14 Annual Report SSRA 2013/14 Annual Report SS

RA M

ANAG

EMEN

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34 SSRA 2013/14 Annual Report 34 SSRA 2013/14 Annual Report SSRA 2013/14 Annual Report

SSRA WORKERS’ COUN

CIL

SSRA Workers’ Council M

embers in a group photo after their m

eeting in February 2014 held in Bagamoyo

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REPORT

OF THE CONTROLLER

AND AUDITOR GENERAL


SSRA WORKERS’ COUN

CIL

SSRA Workers’ Council M

embers in a group photo after their m

eeting in February 2014 held in Bagamoyo

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39SSRA 2013/14 Annual Report 39SSRA 2013/14 Annual Report

REPORT

OF THE CONTROLLER

AND AUDITOR GENERAL

THE UNITED REPUBLIC OF TANZANIANATIONAL AUDIT OFFICE

REPORT OF THE CONTROLLER AND AUDITOR GENERAL ON THE FINANCIAL STATEMENTS OF

THE SOCIAL SECURITY REGULATORY AUTHORITY FOR THE YEAR ENDED 30TH JUNE, 2014

The Controller and Auditor General,National Audit Office,Samora Avenue/Ohio Street,P. O. Box 9080,Tel: 255 (022) 2115157/8Fax: 255 (022) 2117527E-mail [email protected]: www.nao.go.tzDAR ES SALAAM

January, 2015 AR/SSRA/2014

Office of the Controller and Auditor General AR/SSRA/2014i

TABLE OF CONTENTS

Definition of Terms and Abbreviations iii

Background Information 1

Report of the Board of Directors 3

Audit Report on the Financial Statements 20

Audited Financial Statements and Notes to the Financial Statements 22

1.0

2.0

3.0

4.0

Office of the Controller and Auditor General AR/SSRA/2014

ii

_______________________________________________________________________________

Office of the Controller and Auditor General AR/SSRA/2014 ii

Office of the Controller and Auditor General National Audit Office The United Republic of Tanzania (Established under Article 143 of the Constitution of the URT) The statutory duties and responsibilities of the Controller and Auditor General are enshrined under Article 143 of the Constitution of the URT of 1977 (Revised 2005) and further amplified under Sect. 10 of the Public Audit Act. No.11 of 2008 Vision To be a centre of excellence in public sector auditing Mission To provide efficient audit services in order to enhance accountability and value for money in the collection and use of public resources. In providing quality services, NAO is guided by the following Core Values: Objectivity: We are an impartial organization, offering services to our

clients in an objective and unbiased manner; Excellence: We are professionals providing high quality audit services

based on best practices; Integrity: We observe and maintain high standards of ethical behaviour

and the rule of law; People focus: We focus on stakeholders’ needs building a culture of good

customer care having competent and motivated work force; Innovation: We are a creative organization that constantly promotes a

culture of developing and accepting new ideas from inside and outside the organization; and

Best resource utilization: We are an organization that values and uses public resources entrusted to it in efficient, economic and effective manner.

We do this by: - Contributing to better stewardship of public funds by ensuring that our

clients are accountable for the resources entrusted to them; Helping to improve the quality of public services by supporting innovation

on the use of public resources; Providing technical advice to our clients on operational gaps in their

operating systems; Systematically involve our clients in the audit process and audit cycles; and Providing audit staff with adequate working process tools and facilities that

promote independence.

© This audit report is intended for use by SSRA Management. However, upon adoption of the report by the SSRA Board, this report becomes a matter of public record and its distribution may not be limited.

Office of the Controller and Auditor General AR/SSRA/2014iii

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Office of the Controller and Auditor General AR/SSRA/2014 iii

Definition of Terms and Abbreviations: Financial Statements: mean statement of financial position, statement of financial performance, cash flows statement, statement of changes in equity, a summary of significant accounting policies and other explanatory information.

The Ministry: Unless otherwise specified shall mean the Ministry

responsible for matters related to Social Security. The Authority: Unless otherwise specified shall mean the Social Security

Regulatory Authority ATE Association of Tanzania Employers BOD Board of Directors BOT Bank of Tanzania (BOT) CISNA Committee of Insurance, Securities and Non-Banking

Financial Authorities CMSA Capital Markets and Securities Authority DG Director General GEPF GEPF Retirement Benefits Fund GOT Government of Tanzania HIV/AIDS Human Immunodeficiency Virus/Acquired Immune

Deficiency Syndrome ICT Information Communication Technology ILO International Labour Organization INTOSAI International Organization of Supreme Audit Institutions IPSAS International Public Sector Accounting Standards ISA International Standard of Auditing ISACA Information Systems Audit and Control Association ISSA International Social Security Associations IT Information Technology MOU Memorandum of Understanding NAO National Audit Office NHIF National Health Insurance Fund NSSF National Social Security Fund OSHA Occupational Safety and Health Administration PPA Public Procurement Act PPF Parastatal Pension Fund PPR Public Procurement Regulations PSPF Public Services Pension Fund SADC Southern Africa Development Community SSRA Social Security Regulatory Authority TFRS Tanzania Financial Reporting Standards TIRA Tanzania Insurance Regulatory Authority TUCTA Trade Union Congress of Tanzania URT United Republic of Tanzania

Definition of Terms and Abbreviations:

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Office of the Controller and Auditor General AR/SSRA/2014iii

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Office of the Controller and Auditor General AR/SSRA/2014 iii

Definition of Terms and Abbreviations: Financial Statements: mean statement of financial position, statement of financial performance, cash flows statement, statement of changes in equity, a summary of significant accounting policies and other explanatory information.

The Ministry: Unless otherwise specified shall mean the Ministry

responsible for matters related to Social Security. The Authority: Unless otherwise specified shall mean the Social Security

Regulatory Authority ATE Association of Tanzania Employers BOD Board of Directors BOT Bank of Tanzania (BOT) CISNA Committee of Insurance, Securities and Non-Banking

Financial Authorities CMSA Capital Markets and Securities Authority DG Director General GEPF GEPF Retirement Benefits Fund GOT Government of Tanzania HIV/AIDS Human Immunodeficiency Virus/Acquired Immune

Deficiency Syndrome ICT Information Communication Technology ILO International Labour Organization INTOSAI International Organization of Supreme Audit Institutions IPSAS International Public Sector Accounting Standards ISA International Standard of Auditing ISACA Information Systems Audit and Control Association ISSA International Social Security Associations IT Information Technology MOU Memorandum of Understanding NAO National Audit Office NHIF National Health Insurance Fund NSSF National Social Security Fund OSHA Occupational Safety and Health Administration PPA Public Procurement Act PPF Parastatal Pension Fund PPR Public Procurement Regulations PSPF Public Services Pension Fund SADC Southern Africa Development Community SSRA Social Security Regulatory Authority TFRS Tanzania Financial Reporting Standards TIRA Tanzania Insurance Regulatory Authority TUCTA Trade Union Congress of Tanzania URT United Republic of Tanzania


Financial Statements: mean statement of financial position, statement of financial performance, cash flows statement, statement of changes in equity, a summary of significant accounting policies and other explanatory information.

The Ministry: Unless otherwise specified shall mean the Ministry responsible for matters related to Social Security

The Authority: Unless otherwise specified shall mean the SociaRegulatory Authority

ATE Association of Tanzania EmployersBOD Board of Directors BOT Bank of Tanzania (BOT)CISNA Committee of Insurance, Securities and Non

Financial Authorities


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1

Office of the Controller and Auditor General AR/SSRA/2014 1

1.0 BACKGROUND INFORMATION 1.1. Introduction

I have audited the financial statements of the Social Regulatory Authority (SSRA) for the year ended 30th June, 2014. Audit findings and recommendations arising from the examination of the accounting records, appraisal of activities as well as evaluation of the internal control system which requires management attention and action are set out in the Management Letter issued separately to the Authority’s management.

1.2. Financing For the year under review, the Authority activities were fully financed by the Government subventions, World Bank Subvention and other own sources. The financing was as follows: Details Amount (Tshs) Government Subvention 1,341,070,000 Levy 6,879,510,817 Other Sources 137,022,869 Revenue from ILO 116,184,925 Total Revenue 8,473,788,611

1.3. Audit Objectives

The main objective of conducting the audit is to enable the Controller and Auditor General to express an independent opinion on the financial statements of the Social Security Regulatory Authority for the year ended 30th June, 2014 and in particular: To determine whether the financial statements of SSRA have been

prepared in accordance with IPSAS; accrual basis of Accounting. To verify whether procurement of goods and services for the

Authority were acquired through laid down procurement procedures;

To determine whether funds due to SSRA were collected and spent as per the approved work plan, and

To evaluate the overall accuracy of information presented.

1.4. Scope of Audit The audit of the Social Security Regulatory Authority financial statements for the year ended 30th June, 2014 was carried out in accordance with the International Standards of Supreme Auditor Institutions (ISSAI) and such other audit procedures that were considered necessary under the circumstances. The audit covered evaluation of the effectiveness of the financial accounting system and internal controls over the activities of SSRA, the examination and verification of the accompanying financial statements and other auditing procedures as were considered necessary under the circumstances for the purpose of forming an opinion on the financial statements. The audit was carried out on a test basis therefore; the

BACKGROUND INFORMATION

ed the financial statements of the Social Regulatory Authority (SSRA) for the year ended 30th June, 2014. Audit findings

commendations arising from the examination of the accounting records, appraisal of activities as well as evaluation of the internal control system which requires management attention and action are set out in the Management Letter issued separately to the Authority’s

For the year under review, the Authority activities were fully by the Government subventions, World Bank Subvention and

other own sources. The financing was as follows:

Amount (Tshs)vention 1,341,070,000

1.0 BACKGROUND INFORMATION

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audit findings and recommendations are confined to the extent that records, documents and information requested for the purpose of audit were made available to us.

As auditor I am not required to specifically search for fraud and, therefore, my audit cannot be relied upon to disclose all such matters. However, my audit however was planned in such a way that I would have a reasonable expectation of detecting material errors or misstatements in the financial statements resulting from irregularities or fraud. The responsibility for detection, prevention of irregularities or fraud and the maintenance of an effective and adequate system of internal control rest with the management of the Authority.

1.5. Audit Methodology In auditing the financial statements together with the related records of SSRA, the following steps were followed: Planning the audit to obtain an adequate understanding of

SSRA, its activities, operations and assessment of the major risk areas;

Carrying out substantive tests of the balances reported by SSRA management in order to obtain reasonable assurance regarding the amounts and disclosures included in the financial statements;

A review of the internal control structure to assess significant risks, and controls in place to mitigate them;

Examination of receipts and disbursements to establish compliance with financial regulations and other instructions or directives issued;

Conducting interviews and discussions with SSRA management and staff on the audit;

Conducting entrance and exit meetings with the auditee to discuss the audit activities and the results of the audit respectively.

Appraise the previous audit recommendations to determine whether management of the Authority has taken adequate corrective actions.













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1.0 BACKGROUND INFORMATION

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2.0 REPORT OF THE BOARD OF DIRECTORS FOR THE YEAR ENDED 30TH

JUNE, 2014

2.1 Introduction

In compliance with section 52 (3) of the Social Security Regulatory Authority Act No. 8 of 2008 as amended, the Public Finance Act 2001 as revised in 2004, Public Procurement Act, No. 7 of 2011, Public Procurement Regulations 2013 and the Tanzania Financial Reporting Standard (TFRS) No. 1 on Directors’ Report, the Board of Directors submit the Financial Statements of the Social Security Regulatory Authority (SSRA) for the year ended 30th June, 2014.

2.2 Establishment

The Social Security Regulatory Authority (SSRA) was established under the Social Security Regulatory Act No. 8 of 2008 as amended with the main objective of regulating and supervising the Social Security Sector in the country. SSRA became operational in September, 2010. In light of its legal mandate provided in the Act, the Authority plays an important role in regulating and supervising the provisions of social security services in the country and has attached great influence on socio-economic and general well-being of the Tanzanian population.

2.3 Vision, Mission and Values

a) Vision Statement Tanzanians enjoying quality extended and sustained social security services.

b) Mission Statement To ensure quality social security services reach every Tanzanian through soundly regulated Social Security Sector.

c) Core Values The following values are observed and guides SSRA’s conducts when dealing with internal and external customers/clients in fulfilling the Authority’s objectives. (i) Integrity

SSRA values integrity and is committed, consistent, fair and objective in dealing with all parties demonstrating neither favors nor prejudice.

(ii) Professionalism With a competent team, SSRA professionally protects interest of members and providers of Social Security Services through sound and transparent regulations, guidelines, rules and orders.

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Page

(iii) Team work

SSRA promotes teamwork to achieve its vision and strategic objectives. It upholds interdepartmental co-operation and develops its human resource for achievement of strategic goals using a common approach and holds ourselves accountable for our achievement and leverage on complainant’s complementarity.

(iv) Innovativeness

SSRA values radical and gradual improvements in rendering its services. Through service improvements, it develops new methods by means of which services can be rendered more efficiently and effectively using modest investment and conventional know how and recognizes its teams innovation. The Authority places an immense importance of sharing best practices and innovation across the sector.

(v) Confidentiality

SSRA has strict policies and practices regarding confidentiality of its stakeholders’ information. We respect the value and ownership of information and do not disclose without appropriate authority unless there is a legal or professional obligation to do so. SSRA operates in line with the requirements of the Government circular on confidentiality.

2.4 Corporate Governance

SSRA puts emphasis on highest Standards of Corporate Governance. The Organizational structure which includes the Board of Directors is flexible to accommodate changes from internal as well as external environment. The Authority adheres to the global and domestic standards and practices of good Corporate Governance.

The Board of Directors is the governing body of the Authority. It consists of nine non-executive directors including the Chairperson. The Chief Executive Officer is the Secretary to the Board. The Board takes overall responsibility for the Authority, including supervision and administration of the assets of the Authority. The Board is also responsible for ensuring that a comprehensive system of internal control policies and procedures is operative and complies with sound corporate governance principles. The Social Security (Regulatory Authority) Act, 2008 requires the Board of Directors to meet at least four times a year. The Board delegates the day to day management of the Authority to the Director General, who is assisted by Management.

The Board of Directors has a Board Evaluation Tool which is used for assessment of the Board’s performance in discharging its mandate. During the year ended 30th June, 2014, the Board’s performance was not evaluated because the Board’s tenure came

2.0 REPORT OF THE BOARD OF DIRECTORS FORTHE YEAR ENDED 30TH JUNE, 2014


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2.0 REPORT OF THE BOARD OF DIRECTORS FOR THE YEAR ENDED 30TH

JUNE, 2014

2.1 Introduction

In compliance with section 52 (3) of the Social Security Regulatory Authority Act No. 8 of 2008 as amended, the Public Finance Act 2001 as revised in 2004, Public Procurement Act, No. 7 of 2011, Public Procurement Regulations 2013 and the Tanzania Financial Reporting Standard (TFRS) No. 1 on Directors’ Report, the Board of Directors submit the Financial Statements of the Social Security Regulatory Authority (SSRA) for the year ended 30th June, 2014.

2.2 Establishment

The Social Security Regulatory Authority (SSRA) was established under the Social Security Regulatory Act No. 8 of 2008 as amended with the main objective of regulating and supervising the Social Security Sector in the country. SSRA became operational in September, 2010. In light of its legal mandate provided in the Act, the Authority plays an important role in regulating and supervising the provisions of social security services in the country and has attached great influence on socio-economic and general well-being of the Tanzanian population.

2.3 Vision, Mission and Values

a) Vision Statement Tanzanians enjoying quality extended and sustained social security services.

b) Mission Statement To ensure quality social security services reach every Tanzanian through soundly regulated Social Security Sector.

c) Core Values The following values are observed and guides SSRA’s conducts when dealing with internal and external customers/clients in fulfilling the Authority’s objectives. (i) Integrity

SSRA values integrity and is committed, consistent, fair and objective in dealing with all parties demonstrating neither favors nor prejudice.

(ii) Professionalism With a competent team, SSRA professionally protects interest of members and providers of Social Security Services through sound and transparent regulations, guidelines, rules and orders.

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Page

(iii) Team work

SSRA promotes teamwork to achieve its vision and strategic objectives. It upholds interdepartmental co-operation and develops its human resource for achievement of strategic goals using a common approach and holds ourselves accountable for our achievement and leverage on complainant’s complementarity.

(iv) Innovativeness

SSRA values radical and gradual improvements in rendering its services. Through service improvements, it develops new methods by means of which services can be rendered more efficiently and effectively using modest investment and conventional know how and recognizes its teams innovation. The Authority places an immense importance of sharing best practices and innovation across the sector.

(v) Confidentiality

SSRA has strict policies and practices regarding confidentiality of its stakeholders’ information. We respect the value and ownership of information and do not disclose without appropriate authority unless there is a legal or professional obligation to do so. SSRA operates in line with the requirements of the Government circular on confidentiality.

2.4 Corporate Governance

SSRA puts emphasis on highest Standards of Corporate Governance. The Organizational structure which includes the Board of Directors is flexible to accommodate changes from internal as well as external environment. The Authority adheres to the global and domestic standards and practices of good Corporate Governance.

The Board of Directors is the governing body of the Authority. It consists of nine non-executive directors including the Chairperson. The Chief Executive Officer is the Secretary to the Board. The Board takes overall responsibility for the Authority, including supervision and administration of the assets of the Authority. The Board is also responsible for ensuring that a comprehensive system of internal control policies and procedures is operative and complies with sound corporate governance principles. The Social Security (Regulatory Authority) Act, 2008 requires the Board of Directors to meet at least four times a year. The Board delegates the day to day management of the Authority to the Director General, who is assisted by Management.

The Board of Directors has a Board Evaluation Tool which is used for assessment of the Board’s performance in discharging its mandate. During the year ended 30th June, 2014, the Board’s performance was not evaluated because the Board’s tenure came


10

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Table 8: Technical Committee S/N Name Position Qualifications

/ Discipline Nationality Remarks

1 Mr. Jones Sikira

Chairman Seasoned Human Resources Management Expert

Tanzanian Representing t h e Association of Tanzania Employers (ATE)

2 Ms. Jayne Nyimbo Vice Chair person

Seasoned Human Resources Management Expert

Tanzanian Representing t h e Association of Tanzania Employers (ATE)

3 Mr. Mihalale Mwakibinga

Member Seasoned Economist

Tanzanian Representing the Treasury Registrar

4 Mr. Sylvester Mwakitalu

Members Professional Lawyer

Tanzanian Representing the Attorney General’s Office

d) Board Meetings While the new Committees could not meet during the year, the new Board held one extraordinary meeting as shown below: Table 9 Board and Board Committee Meetings

Type of Meeting Board Audit Committee Technical Committee

Ordinary Meeting 0 0 0

Extraordinary Meeting 1 0 -

Total 1 0 0

2.5 Management

The Management of the Authority is under the Director General and is organized in the following directorates and units. a) Directorate of Research, Actuarial and Policy Development; b) Directorate of Compliance and Registration; c) Directorate of Legal Services; d) Directorate of Finance, Planning and Human Resources

Management; e) Internal Audit Unit; f) Information and Communication Technology Unit; g) Public Relations and Promotion Unit; and h) Procurement Management Unit.

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2.6 Principal Activities

Pursuant to section 5 of the Act as amended, the functions of the Authority are to:- a) Register all Managers, Custodians and Schemes; b) Regulate and Supervise the performance of all Managers,

Custodians and Social Security Schemes; c) Issue guidelines for the efficient and effective operation of the

Social Security Sector; d) Protect and safeguard the interests of Scheme’s members; e) Advise the Minister on policy and operational matters relating

to Social Security Sector; f) Adopt and promulgate broad guidelines applicable to all

managers, custodians and social security schemes; g) Monitor and review regularly the performance of Social

Security Sector; h) Initiate studies, recommend, coordinate and implement

reforms in the Social Security Sector; i) Appoint interim administrator of schemes, where necessary; j) Facilitate extension of social security coverage to non-covered

areas including informal groups; and k) Conduct programmes for public awareness, sensitization and

tracing on social security.

2.7 Existing and Future Plans of Social Security Regulatory Authority

The Authority had a three years Strategic Plan running from year 2011/12 to year 2013/14. SSRA’s Plan therefore was geared towards achieving four key Strategic Objectives listed below:- a) Developing conducive legal and regulatory framework to

facilitate faster development of social security in the country by June, 2014;

b) Extending Social Security Coverage to Include Informal Sector by June, 2014;

c) Developing Institutional Capacity of SSRA by June, 2014 d) Promoting Public Education and Awareness Programs on Social

Security Services to Every Tanzanian by June, 2014.

In order to achieve the above key strategic Objectives, the Authority has put in place the following strategies along with the performance indicators


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(55) calls from members on different matters pertaining to social security;

(vii) SSRA signed Multilateral MOU with other financial sector regulators in Tanzania on financial stability. SSRA in collaboration with others financial sector regulators in the country i.e. Bank of Tanzania (BOT), Tanzania Insurance Regulatory Authority (TIRA), and Capital Markets and Securities Authority (CMSA) jointly hosted the 32nd bi-annual meeting of the SADC Committee of Insurance, Securities and Non – Banking Financial Authorities (CISNA) in Tanzania from April 7th - 11th 2014.

(viii) Developed and put in use registration guide for the Supplementary Schemes, Fund Managers and Custodians;

(ix) Registered one (1) Supplementary Scheme; (x) Registered four (4) Custodians; (xi) Registered nine (9) Fund Managers (xii) Conducted Onsite Iinspections to four (4) mandatory Social

Security Schemes (xiii) Conducted offsite surveillance to six Social security

Schemes;; (xiv) Provided oversight on social security registration exercise of

newly recuited public employees across the country; . (xv) Entered into agreement with ILO to conduct benefit specific

actuarial valuation for all registered mandatory Social Security Schemes in the country;

(xvi) Prepared and submitted to the Government for consideration recommendations for the Social Security Reform Programme;

(xvii) Prepared and submitted to the Government for considerations recommendations for improvements and harmonization of social security benefits;

(xviii) Prepared and rolled out Social Security Coverage Extension Strategy;

(xix) Engaged the Tanzania Bureau of Standards to review and advise on implementation of a Quality Management System.

(xx) In collaboration with ILO ,the Ministry of Labour and Employment facilitated workshop on Social Budgeting and Actuarial Modeling for key stakeholders in the social security sector. In collaboration with the Ministry of Labour and Employment, the Authority facilitated a high level workshop on the social protection financing for key policy and decision makers in the Government

(xxi) Conducted fifty seven (57) social security educational and awreness seminars to different groups of people across sectors; where by total of 9,500 people attended;

(xxii) Prepared and rolled out Social Security Communiction Strategy;

(xxiii) Conducted two (2) Press Conference regarding Social Security for All, Social Security Guidelines and application of Section 30 of the SSRA Act of 2008;

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(xxiv) Conducted one (1) media forum which involved managing editors of all major Media Houses;

(xxv) Published through English and Kiswahili newspapers about 93 articles on various subjects relating to social security matters;

(xxvi) Aired twenty (20) TV programmes on different social security matters;

(xxvii) Aired fifteen (15) Radio programmes on social security matters printed and distributed promotional and educational materials.;

(xxviii) Conducted TV and Radio interviews on theree (3) TV and five (5) radio stations explaining various issues relating to social security;`

(xxix) Coordinated and made presentations to Schemes’ Annual General Meetings;

(xxx) Designed and published internal SSRA newsletter; (xxxi) Designed and produced SSRA jingle and song; (xxxii) Participated in six (6) exhibitions organised by ILO, Angles

moment, ISACA, TUCTA), OSHA and President’s Office; Participated on Higher learning institutions Career day;.

(xxxiii) Participated on May Day;. (xxxiv) Engaged consultant to conduct study on planned new social

security products including health products; (xxxv) Engaged consultant to conduct baseline study of social

protection programmes/ initiatives; (xxxvi) Rolled out Hifadhi ya jamii and social security systems for

public awareness; (xxxvii) Started implementation of the Core Business Application

Project where five modules were completed and became operational;

(xxxviii) Facilitated two (2) long term capacity building of staff; Faciliated nineteen (19) staff to attend capacity buiding seminars and workshops in different areas including: Auditing, Business Continuity Management and Disaster Recovery; Social Security; Leadership; Procurement; ICT; Actuarial Modeling; Office Administration and Management; International Public Sector Accounting Standards (IPSAS); Fraud and Governance asm well as Strategic Human Resource Management; ;

(xxxix) Facilitated two (2) seminars for Board Members. One on Social Security Systems and the other on Corporate Governance Enhancement;

(xl) in collaboration with Public Service Recruitment Secretariat (PSRS), facilitated recruitment of nineteen (19) new staff for the Authority;Facilitated establishment and launching of Workers;

(xli) SSRA was named and awarded a trophy by ATE for being the best Employer of the Year (EOY) under Small Company’s category.


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(xxiv) Conducted one (1) media forum which involved managing editors of all major Media Houses;

(xxv) Published through English and Kiswahili newspapers about 93 articles on various subjects relating to social security matters;

(xxvi) Aired twenty (20) TV programmes on different social security matters;

(xxvii) Aired fifteen (15) Radio programmes on social security matters printed and distributed promotional and educational materials.;

(xxviii) Conducted TV and Radio interviews on theree (3) TV and five (5) radio stations explaining various issues relating to social security;`

(xxix) Coordinated and made presentations to Schemes’ Annual General Meetings;

(xxx) Designed and published internal SSRA newsletter; (xxxi) Designed and produced SSRA jingle and song; (xxxii) Participated in six (6) exhibitions organised by ILO, Angles

moment, ISACA, TUCTA), OSHA and President’s Office; Participated on Higher learning institutions Career day;.

(xxxiii) Participated on May Day;. (xxxiv) Engaged consultant to conduct study on planned new social

security products including health products; (xxxv) Engaged consultant to conduct baseline study of social

protection programmes/ initiatives; (xxxvi) Rolled out Hifadhi ya jamii and social security systems for

public awareness; (xxxvii) Started implementation of the Core Business Application

Project where five modules were completed and became operational;

(xxxviii) Facilitated two (2) long term capacity building of staff; Faciliated nineteen (19) staff to attend capacity buiding seminars and workshops in different areas including: Auditing, Business Continuity Management and Disaster Recovery; Social Security; Leadership; Procurement; ICT; Actuarial Modeling; Office Administration and Management; International Public Sector Accounting Standards (IPSAS); Fraud and Governance asm well as Strategic Human Resource Management; ;

(xxxix) Facilitated two (2) seminars for Board Members. One on Social Security Systems and the other on Corporate Governance Enhancement;

(xl) in collaboration with Public Service Recruitment Secretariat (PSRS), facilitated recruitment of nineteen (19) new staff for the Authority;Facilitated establishment and launching of Workers;

(xli) SSRA was named and awarded a trophy by ATE for being the best Employer of the Year (EOY) under Small Company’s category.


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2.9 Challenges

Despite the above summarized achievements, the Authority encountered a number of challenges as follows:

(i) Delay in receipt of levy Funds Due to delay in finalization of Levy Regulations and Levy Order, the expected levy funds were received two months after commencement of financial year. Some schemes paid their dues as planned while others due to different reasons paid their dues toward the end of financial year. Consequent to that some of the planned activity could not start in time.

(ii) Other Challenges In addition to the above challenges, the Authority faced the following challenges during the year ended June, 30th 2014:

a) Understaffing; b) Limited office space; c) Inadequate ICT capacity to cope with rapid technological

change and international standards and best practice.

(iii) Challenges facing the Sector a) Fragmentation of benefits structure; b) Low social security coverage; c) Inadequate awareness of social security products and

services; d) Inadequate benefits to members.

2.10 Accounting Policies

The Authority prepared its books of accounts and Financial Statements in compliance with the International Public Sector Accounting Standards (IPSAS) Accrual Basis. During the period under review, one new International Standard became applicable i.e. IPSAS 32 Service Concession Arrangements: Grantor due.

2.11 Performance for the Year The Authority during the year ended 30th June, 2014 posted a surplus of TZS 1,327 million compared to a deficit of TZS 669 million in the preceding year. The Annual revenue increased from TZS 2,907 million in June, 2013 to TZS 8,473 million in June, 2014. The increase translates to 191 % increase. Moreover operating expenditures increased by 100% from TZS 3,578 million in June, 2013 to TZS 7,147 million in June, 2014. The increase in both revenues and expenditures is attributed to increased operations financed by levy from Social Security Schemes which the Authority started receiving during the period under review. During the period under review, the Authority budgeted to collect a total revenue amounting to TZS10.84 billion from two major sources namely; Government Subvention TZS 2.6 billion and Levy and other revenues TZS 8.21 billion. By the end of year

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under review, the Authority received 51% of the budgeted revenues from Government Subvention. Non receipt of the funds under this source is mainly due to delays in obtaining recruitment permit from the Government, as a result the Authority could not recruit planned staff as expected. Further the Authority received 100% of Levy fund from Social Security Schemes as planned. The Authority further received TZS 183 million from other revenue source.

2.12 Risk Management and Internal Control

The Board accepts final responsibility for the risk management and internal control systems of the Authority. It is the responsibility of Management to ensure that adequate internal financial and operational control systems are developed and maintained on an ongoing basis in order to provide reasonable assurance regarding: i) The effectiveness and efficiency of operations; ii) The safeguarding of the Authority’s Assets; iii) Compliance with applicable laws and regulations; iv) The reliability of accounting records. v) Business sustainability under normal as well as adverse

conditions; and vi) Responsible behaviors towards all stakeholders. The Authority has a well-established Risk Management Policy and the Enterprise Risk Management Framework to guide the Management on key risks facing the Authority.

The Board assessed the internal control systems throughout the financial year ended 30th June, 2014 and was of the opinion that they met accepted criteria. The Board carries risk and internal control assessment through the Audit and Risk Management Committee.

2.13 Ownership

Social Security Regulatory Authority (SSRA) is fully owned by the Government of the United Republic of Tanzania.

2.14 Solvency

The Authority’s state of affairs as at 30th June, 2014 is reflected in these Financial Statements prepared using International Public Sector Accounting Standards (IPSAS) Accrual. The Board considers the Authority to be solvent.

2.15 Related Party Transactions

All related party transactions and balances are disclosed in note number 14 to these Financial Statements.


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2.16 Employees’ Welfare The total number of employees during the year under review remained at the level of twenty seven (27).Out of which fifteen (15) is males and (12) are females. During the period under review, the Authority continued to enjoy stability in terms of labour retention whereby no incidences of employees leaving the employment of the Authority occurred. Furthermore, initial stage of recruitment of 19 staff commenced following obtaining of employment Permit from the President’s Office Public Services Management. The exercise is carried out by President’s Office Employment Secretariat in consultation with SSRA Management.

The relationship between the employees and SSRA Management was sound and there were no unresolved complaints received by Management from employees during the year. A Workers’ Council was established and launched during second quarter of 2013/14.

2.17 Persons with Disabilities SSRA is an equal opportunity employer, giving equal access to employment opportunities and ensures the best available person is appointed to any given position without discrimination of any kind and without regard to any factors like gender, marital status, tribes, religion and disability (that does not impair ability to discharge requisite duties).

2.18 Training and Development Training programs have been developed to ensure that employees are equipped with additional skills at all levels. During the year under review, the Authority secured and placed in different long and short term capacity building programmes some of its staff and Board Members. The secured capacity building programmes ranged from basic to advanced skills in social security regulations, legal and regulatory framework, ICT, procurements, actuarial science, Corporate Governance Human Resources and leadership.

2.19 Medical Assistance All SSRA staff is members of the National Health Insurance Fund. In addition, the Authority meets all uncovered medical expenses of its employees and their immediate dependents in accordance with SSRA Health Policy of 2012.

2.20 HIV/AIDS Policy Management of HIV/AIDS and other non-Communicable diseases is an important challenge for the Tanzania Government and its respective institutions. SSRA emphasizes on the protection and prevention of HIV/AIDS and other non-Communicable diseases to its staff and strives to offer the right support to victims. No member of staff has been and will be discriminated due to his/ her HIV/AIDS or other non-Communicable diseases status.

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2.21 Employees’ Pension Benefit Plan

The Authority pays pension contributions to the mandatory Social Security Schemes for its employees on monthly basis. Under this arrangement, contributions are paid to the respective Schemes where staff has been registered. During the year in consideration, the Authority have staff contributing to all registered Schemes that is NSSF, PPF Pensions, GEPF Retirement Fund, PSPF, and LAPF.

2.22 Financial Support Loans, salary advances and other assistance are available to all confirmed employees in accordance with approved Financial and Staff Regulations. In addition, SSRA staff has formed and are operating SSRA SACCOS for purpose of availing them with short term financial support.

2.23 Political and Charitable Donations The Authority did not make any political donations during the year in consideration. The Authority however made charitable donations to Dodoma Hospital in terms equipment necessary for the wellbeing of patients.

2.24 Anti-Corruption Campaign In conducting its activities, SSRA maintains transparency and observes the principles of good governance. It has established an Ethics Committee and it has prepared and put in implementation a Code of Ethics dealing with unethical issues including corruption.

2.25 Auditors The Controller and Auditor General is the Statutory Auditor of the Authority by virtue of Article 143 of the Constitution of the United Republic of Tanzania as amplified under section 10 (1) of the Public Audit Act No 11 of 2008 and section 53 of the Social Security (Regulatory Authority) Act, 2008 as amended.

2.26 Statement of Directors’ Responsibilities The Board is required under section 53 of the Social Security (Regulatory Authority) Act; of 2008 as amended, to prepare Financial Statements for each year that give a true and fair view of the state of affairs of the Authority as at the end of the financial year and of the surplus or deficit of the Authority for that period.

The Board confirms that suitable accounting policies have been used and applied consistently, and reasonable and prudent judgments and estimates have been made in the preparation of the Financial Statements for the year ended 30th June, 2014. The Board, also confirms that the International Public Sector Accounting Standards (IPSAS) Accrual; have been complied with in


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2.16 Employees’ Welfare The total number of employees during the year under review remained at the level of twenty seven (27).Out of which fifteen (15) is males and (12) are females. During the period under review, the Authority continued to enjoy stability in terms of labour retention whereby no incidences of employees leaving the employment of the Authority occurred. Furthermore, initial stage of recruitment of 19 staff commenced following obtaining of employment Permit from the President’s Office Public Services Management. The exercise is carried out by President’s Office Employment Secretariat in consultation with SSRA Management.

The relationship between the employees and SSRA Management was sound and there were no unresolved complaints received by Management from employees during the year. A Workers’ Council was established and launched during second quarter of 2013/14.

2.17 Persons with Disabilities SSRA is an equal opportunity employer, giving equal access to employment opportunities and ensures the best available person is appointed to any given position without discrimination of any kind and without regard to any factors like gender, marital status, tribes, religion and disability (that does not impair ability to discharge requisite duties).

2.18 Training and Development Training programs have been developed to ensure that employees are equipped with additional skills at all levels. During the year under review, the Authority secured and placed in different long and short term capacity building programmes some of its staff and Board Members. The secured capacity building programmes ranged from basic to advanced skills in social security regulations, legal and regulatory framework, ICT, procurements, actuarial science, Corporate Governance Human Resources and leadership.

2.19 Medical Assistance All SSRA staff is members of the National Health Insurance Fund. In addition, the Authority meets all uncovered medical expenses of its employees and their immediate dependents in accordance with SSRA Health Policy of 2012.

2.20 HIV/AIDS Policy Management of HIV/AIDS and other non-Communicable diseases is an important challenge for the Tanzania Government and its respective institutions. SSRA emphasizes on the protection and prevention of HIV/AIDS and other non-Communicable diseases to its staff and strives to offer the right support to victims. No member of staff has been and will be discriminated due to his/ her HIV/AIDS or other non-Communicable diseases status.

_______________________________________________________________________________


2.21 Employees’ Pension Benefit Plan

The Authority pays pension contributions to the mandatory Social Security Schemes for its employees on monthly basis. Under this arrangement, contributions are paid to the respective Schemes where staff has been registered. During the year in consideration, the Authority have staff contributing to all registered Schemes that is NSSF, PPF Pensions, GEPF Retirement Fund, PSPF, and LAPF.

2.22 Financial Support Loans, salary advances and other assistance are available to all confirmed employees in accordance with approved Financial and Staff Regulations. In addition, SSRA staff has formed and are operating SSRA SACCOS for purpose of availing them with short term financial support.

2.23 Political and Charitable Donations The Authority did not make any political donations during the year in consideration. The Authority however made charitable donations to Dodoma Hospital in terms equipment necessary for the wellbeing of patients.

2.24 Anti-Corruption Campaign In conducting its activities, SSRA maintains transparency and observes the principles of good governance. It has established an Ethics Committee and it has prepared and put in implementation a Code of Ethics dealing with unethical issues including corruption.

2.25 Auditors The Controller and Auditor General is the Statutory Auditor of the Authority by virtue of Article 143 of the Constitution of the United Republic of Tanzania as amplified under section 10 (1) of the Public Audit Act No 11 of 2008 and section 53 of the Social Security (Regulatory Authority) Act, 2008 as amended.

2.26 Statement of Directors’ Responsibilities The Board is required under section 53 of the Social Security (Regulatory Authority) Act; of 2008 as amended, to prepare Financial Statements for each year that give a true and fair view of the state of affairs of the Authority as at the end of the financial year and of the surplus or deficit of the Authority for that period.

The Board confirms that suitable accounting policies have been used and applied consistently, and reasonable and prudent judgments and estimates have been made in the preparation of the Financial Statements for the year ended 30th June, 2014. The Board, also confirms that the International Public Sector Accounting Standards (IPSAS) Accrual; have been complied with in


19

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preparation of 2014 Financial Statements. The Board is responsible for keeping proper accounting records, for safeguarding the assets of the Authority and hence taking reasonable steps for prevention of fraud and other irregularities.

BY ORDER OF THE BOARD --------------------------------- ----------------------------

Juma A. Muhimbi Irene Isaka Board Chairman Director General

Date……..…………

_______________________________________________________________________________


3.0 AUDIT REPORT ON THE FINANCIAL STATEMENTS

To: Mr. Juma A. Muhimbi Chairman of Board of Directors,

Social Security Regulatory Authority, P.O. Box 13884, DAR ES SALAAM

RE: REPORT OF THE CONTROLLER AND AUDITOR GENERAL ON THE

FINANCIAL STATEMENTS OF THE SOCIAL SECURITY REGULATORY AUTHORITY FOR THE YEAR ENDED 30TH JUNE, 2014

Introduction I have audited the accompanying financial statements of the Social Security Regulatory Authority (SSRA) which comprises the statement of financial position as at 30th June, 2014, statement of financial performance, statement of cash flows and statement of changes in equity for the year then ended and a summary of significant accounting policies and other explanatory notes set out from pages 26 to 39 of this report. Directors’ responsibility for the financial statements The Board of Directors of the Social Security Regulatory Authority is responsible for the preparation and fair presentation of these financial statements in accordance with the International Public Sector Accounting Standards (IPSAS). This responsibility includes designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatements, whether due to fraud or error, selecting and applying appropriate accounting policies and making accounting estimates that are reasonable in the circumstances. Responsibility of the Controller and Auditor General My responsibility as auditor is to express an independent opinion on the financial statements based on the audit. The audit was conducted in accordance with the International Standards of Supreme Audit Institutions (ISSAI) and such other audit procedures I considered necessary in the circumstances. Those standards require that I comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal controls relevant to the Authority’s preparation and fair presentation of financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of


_______________________________________________________________________________


3.0 AUDIT REPORT ON THE FINANCIAL STATEMENTS

To: Mr. Juma A. Muhimbi Chairman of Board of Directors,

Social Security Regulatory Authority, P.O. Box 13884, DAR ES SALAAM

RE: REPORT OF THE CONTROLLER AND AUDITOR GENERAL ON THE

FINANCIAL STATEMENTS OF THE SOCIAL SECURITY REGULATORY AUTHORITY FOR THE YEAR ENDED 30TH JUNE, 2014

Introduction I have audited the accompanying financial statements of the Social Security Regulatory Authority (SSRA) which comprises the statement of financial position as at 30th June, 2014, statement of financial performance, statement of cash flows and statement of changes in equity for the year then ended and a summary of significant accounting policies and other explanatory notes set out from pages 26 to 39 of this report. Directors’ responsibility for the financial statements The Board of Directors of the Social Security Regulatory Authority is responsible for the preparation and fair presentation of these financial statements in accordance with the International Public Sector Accounting Standards (IPSAS). This responsibility includes designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatements, whether due to fraud or error, selecting and applying appropriate accounting policies and making accounting estimates that are reasonable in the circumstances. Responsibility of the Controller and Auditor General My responsibility as auditor is to express an independent opinion on the financial statements based on the audit. The audit was conducted in accordance with the International Standards of Supreme Audit Institutions (ISSAI) and such other audit procedures I considered necessary in the circumstances. Those standards require that I comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal controls relevant to the Authority’s preparation and fair presentation of financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of


21

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expressing an opinion on the effectiveness of the Authority’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. Sect. 10 (2) of the PAA No. 11 of 2008 requires me to satisfy myself that the accounts have been prepared in accordance with the appropriate accounting standards and that; reasonable precautions have been taken to safeguard the collection of revenue, receipt, custody, disposal, issue and proper use of public property, and that the law, directions and instructions applicable thereto have been duly observed and expenditures of public monies have been properly authorized. Further, Sect 44 (2) of the Public Procurement Act No. 21 of 2004 and Reg. No. 31 of the Public Procurement (Goods, Works, Non-consultant Services and Disposal of Public Assets by Tender) Regulations of 2005 requires me to state in my annual audit report whether or not the auditee has complied with the provisions of the Law and its Regulations. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion. Unqualified Opinion In my opinion, the financial statements fairly reflect in all material respects, the financial position of the Social Security Regulatory Authority as at 30th June, 2014, its financial performance and its cash flows for the year then ended, in accordance Public Sector Accounting Standards. Report on Other Legal and Regulatory Requirements Statement of Compliance with Public Procurement Act In view of my responsibility on the procurement legislation, and taking into consideration the procurement transactions and processes I reviewed as part of this audit, I state that the Social Security Regulatory Authority procurement procedures have generally complied with the requirements of the Public Procurement Act of 2011 and its underlying regulations of 2013. Prof. Mussa Juma Assad CONTROLLER AND AUDITOR GENERAL National Audit Office Dar es salaam Date: 27th January, 2015

_______________________________________________________________________________


4.0 AUDITED FINANCIAL STATEMENTS AND NOTES TO THE FINANCIAL STATEMENTS

STATEMENT OF FINANCIAL POSITION AS AT 30TH JUNE, 2014

NOTE 30.06.2014 30.06.2013

TZS TZS

ASSETS Non-Current Assets Property, Plant and

Equipment 02

827,297,801

444,391,694

Intangible Assets 03

216,486,774

71,722,288

Total Non-Current Assets

1,043,784,575

516,113,982

Current Assets

Cash and Cash Equivalents 04

1,909,583,493

906,748,226

Receivables 05

34,558,616

103,420,952

Supplies Inventories 06

15,930,477

10,923,473

Held for Sale Fixed assets

6,748,437

Total Current Assets

1,960,072,586

1,027,841,088

TOTAL ASSETS

3,003,857,161

1,543,955,070

EQUITY AND LIABILITIES Liabilities

Current Liabilities 07

1,615,780,890

1,807,068,930

Long term Liabilities 07

324,381,980

-

Total Liabilities

1,940,162,870

1,807,068,930

Net Assets (Equity)

1,063,694,291

(263,113,861)

TOTAL EQUITY AND LIABILITIES

3,003,857,161

1,543,955,070

The Statement of Financial Position is to be read in conjunction with the notes to Accounts and forming part of the Financial Statements set out in pages 26 to 39 were authorized for issue by Board of Directors and signed on behalf by: --------------------------------- --------------------------------

Board Chairman Director General

------------------------------------------ Date


_______________________________________________________________________________


expressing an opinion on the effectiveness of the Authority’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. Sect. 10 (2) of the PAA No. 11 of 2008 requires me to satisfy myself that the accounts have been prepared in accordance with the appropriate accounting standards and that; reasonable precautions have been taken to safeguard the collection of revenue, receipt, custody, disposal, issue and proper use of public property, and that the law, directions and instructions applicable thereto have been duly observed and expenditures of public monies have been properly authorized. Further, Sect 44 (2) of the Public Procurement Act No. 21 of 2004 and Reg. No. 31 of the Public Procurement (Goods, Works, Non-consultant Services and Disposal of Public Assets by Tender) Regulations of 2005 requires me to state in my annual audit report whether or not the auditee has complied with the provisions of the Law and its Regulations. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion. Unqualified Opinion In my opinion, the financial statements fairly reflect in all material respects, the financial position of the Social Security Regulatory Authority as at 30th June, 2014, its financial performance and its cash flows for the year then ended, in accordance Public Sector Accounting Standards. Report on Other Legal and Regulatory Requirements Statement of Compliance with Public Procurement Act In view of my responsibility on the procurement legislation, and taking into consideration the procurement transactions and processes I reviewed as part of this audit, I state that the Social Security Regulatory Authority procurement procedures have generally complied with the requirements of the Public Procurement Act of 2011 and its underlying regulations of 2013. Prof. Mussa Juma Assad CONTROLLER AND AUDITOR GENERAL National Audit Office Dar es salaam Date: 27th January, 2015

_______________________________________________________________________________


4.0 AUDITED FINANCIAL STATEMENTS AND NOTES TO THE FINANCIAL STATEMENTS

STATEMENT OF FINANCIAL POSITION AS AT 30TH JUNE, 2014

NOTE 30.06.2014 30.06.2013

TZS TZS

ASSETS Non-Current Assets Property, Plant and

Equipment 02

827,297,801

444,391,694

Intangible Assets 03

216,486,774

71,722,288

Total Non-Current Assets

1,043,784,575

516,113,982

Current Assets

Cash and Cash Equivalents 04

1,909,583,493

906,748,226

Receivables 05

34,558,616

103,420,952

Supplies Inventories 06

15,930,477

10,923,473

Held for Sale Fixed assets

6,748,437

Total Current Assets

1,960,072,586

1,027,841,088

TOTAL ASSETS

3,003,857,161

1,543,955,070

EQUITY AND LIABILITIES Liabilities

Current Liabilities 07

1,615,780,890

1,807,068,930

Long term Liabilities 07

324,381,980

-

Total Liabilities

1,940,162,870

1,807,068,930

Net Assets (Equity)

1,063,694,291

(263,113,861)

TOTAL EQUITY AND LIABILITIES

3,003,857,161

1,543,955,070

The Statement of Financial Position is to be read in conjunction with the notes to Accounts and forming part of the Financial Statements set out in pages 26 to 39 were authorized for issue by Board of Directors and signed on behalf by: --------------------------------- --------------------------------


------------------------------------------ Date


23

_______________________________________________________________________________


SOCIAL SECURITY REGULATORY AUTHORITY STATEMENT OF FINANCIAL PERFORMANCE FOR YEAR ENDED

30TH JUNE, 2014

NOTE 30.06.2014 30.06.2013

OPERATING REVENUE

TZS TZS Non Exchange Revenue

Government Subvention 08

1,341,070,000

2,625,082,750

Social security Levy 08

6,879,510,817

Revenue from ILO 09

116,184,925

279,684,628 Exchange Revenue

Other Income 10

137,022,869

2,903,648

TOTAL OPERATING REVENUE

8,473,788,611

2,907,671,026

LESS: EXPENDITURES

Operating Expenses 12

6,626,629,183

3,259,896,473

Board Expenses 13

283,529,984

129,105,450

Audit Fees

18,000,000

18,000,000

Depreciation Expenses 02

185,443,491

125,528,409

Amortizations – Intangibles 03

25,005,243

19,560,624

Impairment Loss

-

25,476,018

Loss on Disposal

8,372,558

-

TOTAL OPERATING EXPENSES

7,146,980,459

3,577,566,975

Surplus/(deficit) from Operating Activities

1,326,808,152

(669,895,949)

The Statement of Financial Performance is to be read in conjunction with the notes to Accounts and forming part of the Financial Statements set out in pages 26 to 39. The Statement of Financial Performance was authorized for issue by Board of Directors and signed on behalf by:

--------------------------------- --------------------------------- Board Chairman Director General

………………..… Date

_______________________________________________________________________________


SOCIAL SECURITY REGULATORY AUTHORITY

STATEMENT OF CHANGE IN NET ASSETS/EQUITY FOR THE YEAR ENDED 30TH JUNE, 2014

30.06.2014 30.06.2013

TZS TZS

Net Assets at the Beginning of the Year

(263,113,861)

406,782,090

Add: Over Expenditure for the Last period

-

Net Surplus/(Deficit) for the Year

1,326,808,152 (669,895,949)

Net Assets at the end of the Year(Equity)

1,063,694,291

(263,113,861)

The Statement of Change in Net Assets/Equity is to be read in conjunction with the notes to

Accounts and forming part of the Financial Statements set out in pages 26 to 39. The

Statement of Change in Net Assets was authorized for issue by Board of Directors and signed

on behalf by:

--------------------------------- ---------------------------------


Date……………..…


_______________________________________________________________________________


SOCIAL SECURITY REGULATORY AUTHORITY STATEMENT OF FINANCIAL PERFORMANCE FOR YEAR ENDED

30TH JUNE, 2014

NOTE 30.06.2014 30.06.2013

OPERATING REVENUE

TZS TZS Non Exchange Revenue

Government Subvention 08

1,341,070,000

2,625,082,750

Social security Levy 08

6,879,510,817

Revenue from ILO 09

116,184,925

279,684,628 Exchange Revenue

Other Income 10

137,022,869

2,903,648

TOTAL OPERATING REVENUE

8,473,788,611

2,907,671,026

LESS: EXPENDITURES

Operating Expenses 12

6,626,629,183

3,259,896,473

Board Expenses 13

283,529,984

129,105,450

Audit Fees

18,000,000

18,000,000

Depreciation Expenses 02

185,443,491

125,528,409

Amortizations – Intangibles 03

25,005,243

19,560,624

Impairment Loss

-

25,476,018

Loss on Disposal

8,372,558

-

TOTAL OPERATING EXPENSES

7,146,980,459

3,577,566,975

Surplus/(deficit) from Operating Activities

1,326,808,152

(669,895,949)

The Statement of Financial Performance is to be read in conjunction with the notes to Accounts and forming part of the Financial Statements set out in pages 26 to 39. The Statement of Financial Performance was authorized for issue by Board of Directors and signed on behalf by:

--------------------------------- --------------------------------- Board Chairman Director General

………………..… Date

_______________________________________________________________________________


SOCIAL SECURITY REGULATORY AUTHORITY

STATEMENT OF CHANGE IN NET ASSETS/EQUITY FOR THE YEAR ENDED 30TH JUNE, 2014

30.06.2014 30.06.2013

TZS TZS

Net Assets at the Beginning of the Year

(263,113,861)

406,782,090

Add: Over Expenditure for the Last period

-

Net Surplus/(Deficit) for the Year

1,326,808,152 (669,895,949)

Net Assets at the end of the Year(Equity)

1,063,694,291

(263,113,861)

The Statement of Change in Net Assets/Equity is to be read in conjunction with the notes to

Accounts and forming part of the Financial Statements set out in pages 26 to 39. The

Statement of Change in Net Assets was authorized for issue by Board of Directors and signed

on behalf by:

--------------------------------- ---------------------------------


Date……………..…


25

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SOCIAL SECURITY REGULATORY AUTHORITY STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30TH JUNE, 2014

NOTE 30.06.2014 30.06.2013

TZS TZS

CASH FLOWS FROM OPERATING ACTIVITIES

Net Cash flows from Operating Activities 11

1,742,578,715 995,853,575

CASH FLOWS FROM INVESTING ACTIVITIES

Purchase of Property, Plant and Equipment 02

(577,433,219)

(207,294,544)

Purchase of Intangible Assets 03

(169,769,730)

-

Proceed of Sale of Property, Plant and Equipment

7,459,500

NET CASH FLOWS FROM INVESTING ACTIVITIES

(739,743,449)

(207,294,544)

CASH FLOWS FROM FINANCING ACTIVITIES

-

-

NET CASH FLOWS FROM FINANCING ACTIVITIES

-

-

NET INCRESE/DECRESE IN CASH AND CASH EQUIVALENT

1,002,835,267

788,559,031

Cash and cash equivalent at the beginning of the year

906,748,226 118,189,195

CASH AND CASH EQUIVALENT AT THE YEAR END 03

1,909,583,493

906,748,226

The Statement of Cash flows is to be read in conjunction with the notes to Accounts and

forming part of the Financial Statements set out in pages 26 to 39.The Statement of Cash

Flow was authorized for issue by Board of Directors and signed on behalf by:

--------------------------------- --------------------------------------


------------------------------------

Date

_______________________________________________________________________________


Notes to the Financial Statements for the Year Ended 30th June, 2014 NOTE 1 i) General Information

(a) The Social Security Regulatory Authority was established by the

Social Security (Regulatory Authority) Act; of 2008 .The Act stipulates in detail the objectives, functions and powers of the Authority. The Authority offices are located at the 2nd Floor, Alfa House, along New Bagamoyo Road.

(b) The overall management of SSRA is vested in the Board of Directors as the Governing body under the supervision of the Ministry of Labor and Employment. The Director General carries out the day to day operations of the Authority assisted by Management.

ii) Statement of Compliance and Basis of Preparation These Financial Statements have been prepared in accordance and comply with the International Public Sector Accounting Standards (IPSAS) and SSRA ACT no 8 of 2008 as amended by Act No. 5 of 2012. The measurement base applied is historical cost basis except where otherwise stated in the accounting policies stated below. The Financial Statements are presented in Tanzanian Shillings (TZS).

iii) Changes in Accounting Policies and Disclosures

The accounting policies adopted are consistent with those of the previous financial year.

iv) New and Amended Standards adopted by the Authority During the year, SSRA adopted IPSAS 32 Service Concession Arrangements: Grantor (IPSAS 32). Service concession arrangements provide a way for governments and other public sector entities to build the infrastructure necessary to maintain and improve critical public services. The Authority does not expect any material impact on its financial position or performance.

v) Key Judgments and Sources of Estimation Uncertainty The preparation of financial statements requires Judgments, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The key judgments Management has made in preparing the financial statements are as follows: a) The lives of intangible assets and property, plant and equipment

and b) Inventory provision.


_______________________________________________________________________________


Notes to the Financial Statements for the Year Ended 30th June, 2014 NOTE 1 i) General Information

(a) The Social Security Regulatory Authority was established by the

Social Security (Regulatory Authority) Act; of 2008 .The Act stipulates in detail the objectives, functions and powers of the Authority. The Authority offices are located at the 2nd Floor, Alfa House, along New Bagamoyo Road.

(b) The overall management of SSRA is vested in the Board of Directors as the Governing body under the supervision of the Ministry of Labor and Employment. The Director General carries out the day to day operations of the Authority assisted by Management.

ii) Statement of Compliance and Basis of Preparation These Financial Statements have been prepared in accordance and comply with the International Public Sector Accounting Standards (IPSAS) and SSRA ACT no 8 of 2008 as amended by Act No. 5 of 2012. The measurement base applied is historical cost basis except where otherwise stated in the accounting policies stated below. The Financial Statements are presented in Tanzanian Shillings (TZS).

iii) Changes in Accounting Policies and Disclosures

The accounting policies adopted are consistent with those of the previous financial year.

iv) New and Amended Standards adopted by the Authority During the year, SSRA adopted IPSAS 32 Service Concession Arrangements: Grantor (IPSAS 32). Service concession arrangements provide a way for governments and other public sector entities to build the infrastructure necessary to maintain and improve critical public services. The Authority does not expect any material impact on its financial position or performance.

v) Key Judgments and Sources of Estimation Uncertainty The preparation of financial statements requires Judgments, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The key judgments Management has made in preparing the financial statements are as follows: a) The lives of intangible assets and property, plant and equipment

and b) Inventory provision.


27

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Key estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised, if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

vi) Principal Accounting Policies The principal accounting policies adopted in the preparation of these financial statements are set out below. These policies have been consistently applied throughout preparation of these financial statements, unless otherwise stated. a) Property, Plant and Equipment Property, Plant and Equipment are initially recoded at cost. These assets are subsequently shown at historical cost, less depreciation and impairment. Historical cost includes expenditure that is directly attributable to the acquisition of the items. Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that the future economic benefits associated with the item will flow to Authority and the cost of the item can be reliably measured. Where an asset is acquired at no cost, or for a nominal cost through a non-exchange transaction, its cost shall be measured at its fair value as at the date of acquisition.

FOR THE YEAR ENDED 30 JUNE 2009 Depreciation is calculated on a straight line method so as to allocate the cost or revalued amount to its residual value over estimated useful life as follows:

Description Rate (%) Per Annum

Motor vehicles 25 Computers and ICT Equipment 25 Office Equipment 20 Furniture and Fittings 25 Buildings 4 Plant : Generators 10

Major renovations are depreciated over the remaining useful life of the related assets or to the date of the next major renovation, whichever is sooner. All other repairs and maintenance expenditure is charged to the Statement of Financial Performance during the financial period in which it is incurred. The asset’s residual values and useful lives are reviewed and adjusted if appropriate at each statement of financial position date. An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount.

_______________________________________________________________________________


b) Intangible Assets and Computer Software Costs associated with developing or maintaining computer software programs are recognized as expenses as and when incurred. Costs that are directly associated with identifiable and unique software products are recognized as Intangible assets. Expenditure that enhances the performance of computer software programs beyond their original specifications is recognized as capital improvement and added to the original cost of the software. The intangible would be amortized over its five years useful life to the Authority with a residual value equal to zero percent of the intangible’s fair value at the date it was acquired. Intangibles will also be reviewed for impairments in accordance with IPSAS 21 c) Impairment of Assets Assets that are subject to the depreciation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable service amount.

A non-cash-generating asset is impaired when the carrying amount of the Asset exceeds its recoverable service amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purpose of assessing impairment, assets are grouped at the lowest levels for which there are separable identifiable cash flows (cash generating units).

d) Inventories Inventories are valued at the lower of cost and net realizable value. Cost is determined on a weighted average cost method and includes expenditure incurred in acquiring the inventories and bringing them to their existing location and condition.

FOR THE YEAR ENDED 30 JUNE 200 Net realizable value is the estimated selling price in the open market less applicable selling expenses. Store and consumables are stated at cost less any provision for obsolescence. Any obsolete items are provided for in full in the year they are detected. e) Revenue Recognition Revenue is defined as the gross inflow of economic benefits or service potential received and receivable by reporting entity during the reporting period which represents an increase in net assets/equity other than increases relating to contribution from owners or collection on behalf other third parties.


_______________________________________________________________________________


b) Intangible Assets and Computer Software Costs associated with developing or maintaining computer software programs are recognized as expenses as and when incurred. Costs that are directly associated with identifiable and unique software products are recognized as Intangible assets. Expenditure that enhances the performance of computer software programs beyond their original specifications is recognized as capital improvement and added to the original cost of the software. The intangible would be amortized over its five years useful life to the Authority with a residual value equal to zero percent of the intangible’s fair value at the date it was acquired. Intangibles will also be reviewed for impairments in accordance with IPSAS 21 c) Impairment of Assets Assets that are subject to the depreciation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable service amount.

A non-cash-generating asset is impaired when the carrying amount of the Asset exceeds its recoverable service amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purpose of assessing impairment, assets are grouped at the lowest levels for which there are separable identifiable cash flows (cash generating units).

d) Inventories Inventories are valued at the lower of cost and net realizable value. Cost is determined on a weighted average cost method and includes expenditure incurred in acquiring the inventories and bringing them to their existing location and condition.

FOR THE YEAR ENDED 30 JUNE 200 Net realizable value is the estimated selling price in the open market less applicable selling expenses. Store and consumables are stated at cost less any provision for obsolescence. Any obsolete items are provided for in full in the year they are detected. e) Revenue Recognition Revenue is defined as the gross inflow of economic benefits or service potential received and receivable by reporting entity during the reporting period which represents an increase in net assets/equity other than increases relating to contribution from owners or collection on behalf other third parties.


29

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SSRA Revenues as defined in IPSAs are recognized on accrual basis of accounting. Revenue is recognized only when it is probable that the economic benefits or service potential associated with the transaction will flow to the Authority. SSRA’s Revenue shall come primarily from government subvention, registration fees, levy fees collected from regulated entities, penalties and other fees relevant to the functions of the Authority. The SSRA may also accept grants, donations and other contributions which do not impair its independence in discharging its functions. f) Transfer Revenue Assets and revenue recognized as a consequence of a transfer are measured at the fair value of the assets recognized as at the date of recognition. Non-monetary assets are measured at their fair value, which is determined by reference to observable market values or by independent appraisal by a member of the valuation profession. Receivables are recognized when a binding transfer arrangement is in place but cash or other assets have not been received. Assets and revenue arising from transfer transactions are recognized in the period in which the transfer arrangement becomes binding, except for some services in-kind. The Authority recognizes only those services in-kind that are received as part of an organized program and for which it can determine a fair value by reference to market rates. Other services in-kind are not recognized. Where a transfer is subject to conditions that, if unfulfilled, require the return of the transferred resources, the Authority recognizes a liability until the condition is fulfilled.

g) Non-Exchange Revenue Non-Exchange revenue or Government grants are assistance by government in the form of transfers of resources to an entity in return for past or future compliance with certain conditions relating to the operating activities of the entity. When the conditions attaching to non-exchange revenue (government grants) have been complied with they are recognized in the Statement of Financial Performance as normal income. When they are for expenses or losses already incurred, they are recognized immediately in Statement of Financial Performance as normal expenditure. When the conditions attaching to non-exchange revenue (government grants) have not been complied with they are recognized in the Statement of Financial position as deferred revenue.

_______________________________________________________________________________


h) Employees Benefits a) Pension Obligation

The Authority has statutory obligations to contribute to various pension schemes in favour of all the employees employed under contract for specified and unspecified period of time. The pension schemes in force which the Authority contributes are NSSF, PPF and PSPF which are all defined benefits plans. Contributions to these plans are recognized as an expense in the period the employee renders the related services. The Authority has no further obligation once the contributions are paid.

b) Short Term Benefits

The cost of all short term benefits such as salaries, employees entitlement to leave pay, medical aids, long service award, other contributions etc. are recognized as staff expenses in period in which the employee renders the related services to the Authority.

c) Termination Benefits

Termination benefits are payable whenever an employee’s employment is terminated before the normal retirement date or whenever an employee accepts voluntary redundancy in exchange of these benefits.

i) Foreign Currency Translation (a) Functional and Presentation Currency

Items included in the financial statements are measured in Tanzanian shillings, the currency of the primary environment in which the entity operates "functional currency". The financial statements are presented in Tanzanian Shillings, which is the Authority's functional and presentation currency.

(b) Transaction and Balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing on the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognized in the Statement of Financial Performance.

Non-monetary items that are measured at historical cost in a foreign currency are translated using the exchange rate at the date of the transaction. Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date the fair value was determined.

Balances in the Financial Position which are in foreign currency are translated at the closing rate at the date of that statement of Financial Position


_______________________________________________________________________________


h) Employees Benefits a) Pension Obligation

The Authority has statutory obligations to contribute to various pension schemes in favour of all the employees employed under contract for specified and unspecified period of time. The pension schemes in force which the Authority contributes are NSSF, PPF and PSPF which are all defined benefits plans. Contributions to these plans are recognized as an expense in the period the employee renders the related services. The Authority has no further obligation once the contributions are paid.

b) Short Term Benefits

The cost of all short term benefits such as salaries, employees entitlement to leave pay, medical aids, long service award, other contributions etc. are recognized as staff expenses in period in which the employee renders the related services to the Authority.

c) Termination Benefits

Termination benefits are payable whenever an employee’s employment is terminated before the normal retirement date or whenever an employee accepts voluntary redundancy in exchange of these benefits.

i) Foreign Currency Translation (a) Functional and Presentation Currency

Items included in the financial statements are measured in Tanzanian shillings, the currency of the primary environment in which the entity operates "functional currency". The financial statements are presented in Tanzanian Shillings, which is the Authority's functional and presentation currency.

(b) Transaction and Balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing on the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognized in the Statement of Financial Performance.

Non-monetary items that are measured at historical cost in a foreign currency are translated using the exchange rate at the date of the transaction. Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date the fair value was determined.

Balances in the Financial Position which are in foreign currency are translated at the closing rate at the date of that statement of Financial Position


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31

_______________________________________________________________________________


j) Cash and Cash Equivalent Cash and cash equivalent include cash in hand, deposit held at call with banks, other short –term highly liquid investments with original maturities of three months or less, and bank overdraft. Bank overdraft is shown within borrowings in current liabilities.

k) Provisions

Provisions are recognized when the Authority has a present or constructive obligation as a result of past events which it is probable will result in an outflow of economic benefits that can be reliably estimated.

l) Financial Risk Management The overall risk management focuses on unpredictable financial markets and is aimed at minimizing potential adverse effects on Authority’s financial performance. The final responsibility of the Authority’s risk management is primarily vested in the hands of the Board of Directors. Management has a duty of developing and maintaining adequate operational and financial internal control systems.

a) Liquidity Risk Management

The Authority has a prudent liquidity risk management procedures through maintaining sufficient cash and marketable securities to cover committed credit facilities and working capital requirements as budgeted in each financial year based on the approved funds disbursed to the Authority from the Government and other donors as well as own generated funds.

b) Credit Risk Management

The potential credit risk involves short-term cash and receivables which are managed as follows:

i) Short Term Cash Surpluses: The Authority may deposit with banks of high credit reputation his short term surpluses.

ii) Receivables

The Authority’s receivables mainly constitute staff debts, schemes which have not paid their registration fees or levy on due dates. If all efforts to collects the outstanding dues from the scheme fail, full provision for impairment are made in accounts and when further efforts fail, Board approval for write off is later sought.

c) Foreign Currency Risks

As and when the need arises, the Authority enters into transactions denominated in foreign currencies (primarily United States Dollars (US$). Foreign currency Risk is managed

_______________________________________________________________________________


at operational level and is monitored by Finance Planning and Administration directorate. Losses arising from foreign currency liabilities are managed through timely payments of outstanding liabilities.

a) Reclassifications and Comparative Figures Certain reclassifications have been made to the prior year’s financial statements to enhance comparability with the current year’s financial statements. As result, certain line items have been amended in the Statement of financial Performance. Comparative figures have been adjusted to conform to the current year’s presentation. The items were reclassified as follows:

Item Previously Reported

classifications After classifications

Public Awareness Expense

141,197,296 +36,846,507 178,043,803

Administrative Expenses

487,059,864 -19,618,336 467,441,528

Capacity Building Expenses

277,724,922 -55,005,265 222,719,657

Staff Costs 2,353,914,392 +37,777,094 2,391,691,486


_______________________________________________________________________________


at operational level and is monitored by Finance Planning and Administration directorate. Losses arising from foreign currency liabilities are managed through timely payments of outstanding liabilities.

a) Reclassifications and Comparative Figures Certain reclassifications have been made to the prior year’s financial statements to enhance comparability with the current year’s financial statements. As result, certain line items have been amended in the Statement of financial Performance. Comparative figures have been adjusted to conform to the current year’s presentation. The items were reclassified as follows:

Item Previously Reported

classifications After classifications

Public Awareness Expense

141,197,296 +36,846,507 178,043,803


487,059,864 -19,618,336 467,441,528


277,724,922 -55,005,265 222,719,657

Staff Costs 2,353,914,392 +37,777,094 2,391,691,486


33

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SOCIAL SECURITY REGULATORY AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30TH JUNE, 2014

NOTE. 02 MOVEMENTS OF PROPERTY, PLANT AND EQUIPMENTS

Furniture and Fittings

Computers and

Photocopier Other

Equipment Motor

Vehicle Plant;

Generator TOTAL

COST TZS TZS TZS TZS TZS TZS

As at 01st July 2013

234,284,744

243,308,735

86,386,400

36,971,400

48,000,000

648,951,279 Additions

Additions for the Year -

241,699,682 4,820,900

330,912,637 - 577,433,219

Disposals

(1,844,000)

(11,139,400) - - -

(12,983,400)

As at 30th June, 2014

232,440,744

473,869,018

91,207,300

367,884,037

48,000,000

1,213,401,099

DEPRECIATION (RATE) 25% 25% 20% 25% 10%

At 01st July, 2013

44,802,159

89,524,746 21,470,962

18,485,700 4,800,000 179,083,567

Charge for the Year

58,126,186

91,476,984 21,797,471

9,242,850 4,800,000 185,443,491

Accumulated Depreciation of Disposed Assets

(911,063)

(2,988,717)


102,017,283

178,013,013

43,268,433

27,728,550

9,600,000

360,627,279

130,423,461

295,856,004

47,938,867

340,155,487

38,400,000

852,773,820

Accumulated Impairment Gain(Loss)

(5,018,751)

(20,457,268 )

(25,476,019)

NET BOOK VALUE

At 30th June, 2014

125,404,710

275,398,736

47,938,867

340,155,487

38,400,000

827,297,801


184,463,835

133,326,721

64,915,438

18,485,700

43,200,000

444,391,694

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SOCIAL SECURITY REGULATORY AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

30TH JUNE, 2014 NOTE. 03

MOVEMENTS OF INTANGIBLE ASSETS

TOTAL

COST

TZS As at 01st July, 2013

97,803,120

Additions Additions for the Year

169,769,730 Disposals

-


267,572,850

DEPRECIATION (RATE)

20% As at 01st July, 2013

26,080,832

Charge for the Year

25,005,243 As at 30th June, 2014

51,086,075

NET BOOK VALUE As at 30th June, 2014

216,486,774 As at 30th June, 2013

71,722,288


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SOCIAL SECURITY REGULATORY AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

30TH JUNE, 2014 NOTE. 03

MOVEMENTS OF INTANGIBLE ASSETS

TOTAL

COST

TZS As at 01st July, 2013

97,803,120

Additions Additions for the Year

169,769,730 Disposals

-


267,572,850

DEPRECIATION (RATE)

20% As at 01st July, 2013

26,080,832

Charge for the Year

25,005,243 As at 30th June, 2014

51,086,075

NET BOOK VALUE As at 30th June, 2014

216,486,774 As at 30th June, 2013

71,722,288


35

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SOCIAL SECURITY REGULATORY AUTHORITY SCHEDULE TO THE ACCOUNTS FOR YEAR ENDED 30TH JUNE, 2014

30.06.2014 30.06.2013

TZS TZS

04 CASH AND CASH EQUIVALENTS

Cash in Hand

32,450

25,400

Stanbic Bank Ltd

30,197,583 893,142,918

NMB Bank

1,879,353,460 13,579,907

TOTAL

1,909,583,493

906,748,226

05 RECEIVABLE:

Social security schemes

5,000,000 5,000,000

Pension Contribution Receivables

- 84,939,000

BOT/ILO

9,486,590 9,486,590

Staff Debtors

19,972,026 3,995,362

SSRA SACCOS Ltd

100,000

TOTAL

34,558,616

103,420,952

06 Supplies Inventory

Food and Refreshments Stock

2,811,102

986,102

Stationery Stock

13,119,375 9,937,371

15,930,477

10,923,473

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30.06.2014 30.06.2013

07 LIABILITIES

Current Liabilities

Provision for Audit Expenses 18,000,000 18,000,000

Deferred Income 1,083,326,585 54,577,200

Other payables (accrued liabilities) 511,454,305 310,767,059

PAYE

- 518,444,511

Directors' Fee Payable

3,000,000 14,000,000

Prepaid Levy - NSSF

- 891,280,160

Sub Total Current Liabilities 1,615,780,890

Long term Liabilities

Deferred Income 324,381,980

TOTAL LIABILITIES

1,940,162,870

1,807,068,930

INCOME:

08 GOVERNMENT SUBVENTION

Government Subventions (PE) 1,341,070,000 1,275,080,550

Government Subventions (OC)

1,350,002,200

Levy Income 6,879,510,817

TOTAL

8,220,580,817

2,625,082,750

09 NON - EXCHANGE REVENUE

FSP 46,800,957 63,125,084

ILO

9,265,000

FSP(ASSETS)


170,931,744

Other equipment

36,362,800

Intangible Assets 69,383,968

-

116,184,925

279,684,628

10 OTHER INCOME

Sale of Tender Documents

5,700,000

300,000

Interest Received on FDR 131,322,869 2,603,648

TOTAL

137,022,869

2,903,648


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30.06.2014 30.06.2013

07 LIABILITIES

Current Liabilities

Provision for Audit Expenses 18,000,000 18,000,000

Deferred Income 1,083,326,585 54,577,200

Other payables (accrued liabilities) 511,454,305 310,767,059

PAYE

- 518,444,511

Directors' Fee Payable

3,000,000 14,000,000

Prepaid Levy - NSSF

- 891,280,160

Sub Total Current Liabilities 1,615,780,890

Long term Liabilities

Deferred Income 324,381,980

TOTAL LIABILITIES

1,940,162,870

1,807,068,930

INCOME:

08 GOVERNMENT SUBVENTION

Government Subventions (PE) 1,341,070,000 1,275,080,550

Government Subventions (OC)

1,350,002,200

Levy Income 6,879,510,817

TOTAL

8,220,580,817

2,625,082,750

09 NON - EXCHANGE REVENUE

FSP 46,800,957 63,125,084

ILO

9,265,000

FSP(ASSETS)


170,931,744

Other equipment

36,362,800

Intangible Assets 69,383,968

-

116,184,925

279,684,628

10 OTHER INCOME

Sale of Tender Documents

5,700,000

300,000

Interest Received on FDR 131,322,869 2,603,648

TOTAL

137,022,869

2,903,648


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30.06.2014 30.06.2013

11 CASH GENERATED FROM OPERATIONS

Reconciliation of surplus/Deficit for the year to cash generated from operations:

Surplus/(Deficit) for the year:

1,326,808,152

(672,320,949)

Adjustments for:

Depreciation -PPE

185,443,491

125,528,409

Amortization - Intangibles

25,005,243

19,560,624

Impairment Loss

-

25,476,018

Cash generated from operations before working capital changes

1,537,256,886

(501,755,898)

Changes in working capital:

Increase in staff and other receivables

68,862,336

(89,434,482)

Increase in accounts payable

133,093,940

1,592,774,030

Increase in inventory for office supplies

(5,007,004)

(5,730,075)

Losses on sale of property, plant and equipment

8,372,557

-

Cash generated from operations

1,742,578,715

995,853,575

12 OPERATING EXPENSES


672,958,796

467,441,528


904,625,916

222,719,657

Public Awareness Expenses

920,731,745

178,043,803

Staff cost

2,837,048,551

2,391,691,486

Research Supervision and Regulations Expenses

1,291,264,174

Total Operating Expenses

6,626,629,183

3,259,896,474

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30.06.2014 30.06.2013

13 BOARD EXPENDITURE

Directors' Fee 3,000,000

24,500,000

Board Expenses 280,529,984

70,451,700

Board Committee Expenses -

44,653,750

TOTAL 283,529,984

139,605,450

14 RELATED PARTY TRANSACTIONS AND BALANCES

The key management personnel (as defined by IPSAS 20, “Related Party

Disclosures”) are the members of board of directors and management.

The aggregate remuneration and number of members of the Board of

Directors and management are:-

30.06.2014 30.06.2013

TZS TZS

Details

i. Directors remuneration

Directors’ fees 18,000,000 24,500,000

Sitting allowance 36,100,000 71,891,000

ii. Senior staff remuneration

Salaries 1,030,000,000 1,030,000,000

The senior staff consists of the Director General, the Heads of Directorates

and of Units.

15 COMMITMENTS

As at the financial position (Balance sheet) date, the Authority had no

Capital Commitment

16 CURRENCY

These Financial Statements are presented in Tanzanian Shillings (TZS).


_______________________________________________________________________________



30.06.2014 30.06.2013

13 BOARD EXPENDITURE

Directors' Fee 3,000,000

24,500,000

Board Expenses 280,529,984

70,451,700

Board Committee Expenses -

44,653,750

TOTAL 283,529,984

139,605,450

14 RELATED PARTY TRANSACTIONS AND BALANCES

The key management personnel (as defined by IPSAS 20, “Related Party

Disclosures”) are the members of board of directors and management.

The aggregate remuneration and number of members of the Board of

Directors and management are:-

30.06.2014 30.06.2013

TZS TZS

Details

i. Directors remuneration

Directors’ fees 18,000,000 24,500,000

Sitting allowance 36,100,000 71,891,000

ii. Senior staff remuneration

Salaries 1,030,000,000 1,030,000,000

The senior staff consists of the Director General, the Heads of Directorates

and of Units.

15 COMMITMENTS

As at the financial position (Balance sheet) date, the Authority had no

Capital Commitment

16 CURRENCY

These Financial Statements are presented in Tanzanian Shillings (TZS).


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39

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17 CONTRACTUAL COMMITMENTS

The contractual Commitments presented in the table below represents

Authority’s future payments under fixed contractual obligations and

commitments. The following table summarizes our contractual

commitment as at June 30th, 2014:

Payments due by period Total Within 1- 12 Months

13-24 Months

(TZS in millions) Contractual commitment for consultancy services 211 210.6 -

Purchase commitment for Office Equipment 118 118

Contractual commitment for Actuarial Services 973 649 324

Contractual commitment for acquisition of software 51 51

Total 1,353 1,029 324


SSRA WINNER OF VARIOUS AWARDS

The SSRA Board Chairman receiving award from the PSPF Board Chairman Mr. George Yembesi in appreciation of the Authority’s social security supervision during the PSPF Annual General meeting held in Dodoma.

SSRA Director General holding a trophy for the Best Presented Financial Statement Award from the National Board of Accountants (NBAA), pausing to her right is the Director of Finance, Planning and Human Resource Management Mr. Mohamed Nyasama in a group photo with SSRA Officers in December 2014

REGISTERED MANDATORY SOCIAL SECURITY

SCHEMES

National Social Security Fund,Benjamin Mkapa Towers,Azikiwe Street,P.O. BOX 1322DAR ES SALAAM.www.nssf.or.tz

National Health Insurance Fund,Kurasini, BenderaTatu,P.O. BOX 11360DAR ES SALAAM.www.nhif.or.tz

LAPF Pensions Fund,CDTF Building,Mtendeni Street,P.O. BOX 1501DODOMA.www.lapftz.org

Public Service Pensions Fund,Golden Jubilee,Ohio Street,P.O. BOX 4843DAR ES SALAAM.www.pspf-tz.org


GEPF Retirement Pensions Fund,GEPF Building,New Bagamoyo Road,P.O. BOX 11492DAR ES SALAAM.www.gepf.or.tz

GEPF Building,New Bagamoyo RoadP.O.BOX 1422DAR ES SALAAM

PPF Pensions Fund,PPF House,Morogoro Road/Samora Avenue,P.O. BOX 72473DAR ES SALAAM.www.ppftz.org

GEPF RETIREMENT BENEFITS FUND

REGISTERED MANDATORY SOCIAL SECURITY

SCHEMES

National Social Security Fund,Benjamin Mkapa Towers,Azikiwe Street,P.O. BOX 1322DAR ES SALAAM.www.nssf.or.tz

National Health Insurance Fund,Kurasini, BenderaTatu,P.O. BOX 11360DAR ES SALAAM.www.nhif.or.tz

LAPF Pensions Fund,CDTF Building,Mtendeni Street,P.O. BOX 1501DODOMA.www.lapftz.org


GEPF Retirement Pensions Fund,GEPF Building,New Bagamoyo Road,P.O. BOX 11492DAR ES SALAAM.www.gepf.or.tz

GEPF Building,New Bagamoyo RoadP.O.BOX 1422DAR ES SALAAM

PPF Pensions Fund,PPF House,Morogoro Road/Samora Avenue,P.O. BOX 72473DAR ES SALAAM.www.ppftz.org


Voluntary Savings Retirement Scheme (VSRS)GEPF Building,New Bagamoyo Road,P.O. BOX 11492DAR ES SALAAM.www.gepf.or.tz

ELCT Retirement Scheme,Boma Road,P.O. BOX 3033,Tel: +25527250885-7,Fax: +255272548858ARUSHA.Email: [email protected] / [email protected]

PPF Deposit Administration Scheme (DAS)PPF House,Morogoro Road/Samora Avenue,P.O. BOX 72473DAR ES SALAAM.www.ppftz.org


REGISTERED SUPPLEMENTARY SOCIAL

SECURITY SCHEMES

LAPF Defined Contribution (LAPF-DC),CDTF Building,Mtendeni Street,P.O. BOX 1501DODOMA.www.lapftz.org

PSPF Supplementary Scheme (PSS),Golden Jubilee,Ohio Street,P.O. BOX 4843DAR ES SALAAM.www.pspf-tz.org

SSRA Annual Report 2013-14.pdf

Documents

Transcript of SSRA Annual Report 2013-14.pdf