TANZANIA CIVIL AVIATION AUTHORITY - tcaa.go.tz report_Final.pdf · TANZANIA CIVIL AVIATION...

TANZANIA CIVIL AVIATION AUTHORITY

ANNUAL REPORT FOR THE YEAR ENDED 30TH JUNE, 2011

Aviation Safety and Efficiency. Our Commitment. In Partnership

1TCAA Annual Report June 2011

Table of ConTenTslIsT of fIGURes 2lIsT of abbReVIaTIons 3 - 4oPeRaTIonal PeRfoRManCe 7

1.0 safeTY anD seCURITY ReGUlaTIon 71.1 Personnel Licensing Section 71.1.1 Examination 81.1.2 LicencesandCertificatesissued 91.1.3 Renewals 91.1.4 Endorsements 101.1.5 SaleofDocuments 10-111.1.6 Accidents and Incidents 111.1.7 AviationSecurity 12

2.0 eConoMIC ReGUlaTIon 152.1 AirTransportRegulation 152.2 Licensingofairandgroundhandlingservices 152.2.1Statusoflicensingofairservicesoperators 152.2.2Statusoflicensingofgroundhandlingservicesoperators 172.3 Bilateral Air Services Agreements (BASAs) 182.4 Coordination of facilitation of Air Transport 182.5. Statistical Reports 182.6. TrafficPerformance 18

3.0 aIR naVIGaTIon seRVICes 213.1 Air Navigation Services 213.1.2 AirTrafficIncidents 213.1.3 ProficiencyandadequacyofStaff 213.1.4 AvailabilityofNewCNSfacilities 213.1.5 Operationoffacilitiesatoptimumlevel 213.1.6 AirTrafficServices 223.1.7 AeronauticalInformationServices 233.1.8 TheCivilAviationTrainingCentre 24

4.0 CoRPoRaTe seRVICes 244.1 HumanResources 244.1.1 Procurement. 254.1.2 AviationHouse 25

5.0 RePoRTs anD fInanCIal sTaTeMenTsfoR THe YeaR enDeD 30 JUne 20115.1 CorporateInformation 295.2 ReportoftheDirectors 30-315.3 Statement of Directors’ Responsibilities 325.4 IndependentAuditor’sReport 33-345.4 StatementofComprehensiveIncome 355.7 Statement of Financial Position 365.8 StatementofChangesinEquity 375.9 StatementofCashFlows 385.10 NotestotheFinancialStatements 39-60

2 TCAA Annual Report June 2011

lIsT of fIGURes

Figure1: FlightOperationsInspectionsandSurveillance 7

Figure2: AirworthinessInspectionandsurveillance 8

Figure3: TechnicalExaminations 9

Figure4: LicenceandCertificate 10

Figure5: Licence/Certificate/Rating 11

Figure6: Endorsement 11

Figure7: Saleofdocument 12

Figure8: AccidentsandIncidents 13

Figure9: Oversighttask 14

Figure10:Certificate/Renewals 15

Figure11:Statusoflicensingofairservicesoperator 17

Figure12:Statusoflicensingofgroundhandlingservicesoperators 18

Figure13:AircraftMovementsin2009/10and2010/2011 21

Figure14:PassengerTrafficin2009/10and2010/2011 22

Figure15:CargoTraffic(Tons)in2009/10and2010/2011 22

Figure16:AirTrafficMovementsatAirports 26

Figure17:TotalNumberofAirTrafficMovementsbyMonths 26


lIsT of abbReVIaTIons

ACC Area Control CentreAFCAC African Civil Aviation CommissionAFI Africa-IndianOceanRegionAIP AeronauticalInformationPublicationAMEs AircraftMaintenanceEngineersAMOs AircraftMaintenanceOrganizationsANS Air Navigation ServicesAOC AirOperatorsCertificateATCL AirTanzaniaCompanyLtdATCOs AirTrafficControlOfficersATM AirTrafficManagementATSDS AirTrafficServicesDirectSpeechAVSEC AviationSecurityAWOS AutomatedWeatherObservationSystemBASA Bilateral Air Service AgreementCASSOA CivilAviationSafetyandSecurityOversightAgencyCATC Civil Aviation Training CentreCCC ConsumerConsultativeCouncilCCs ComplianceChecklistsCMCC CivilMilitaryCoordinationMeetingCNS Communications,NavigationandSurveillanceCVOR ConventionalVeryHighFrequencyOmni-DirectionalRadioRangeDME DistanceMeasuringEquipmentDVOR DopplerVeryHighFrequencyOmni-directionalRadioRangeEAC EastAfricanCommunityEIB EuropeanInvestmentBank.ENAC FrenchInstituteofCivilAviationTrainingERB Engineers Registration BoardFAA Federal Aviation AdministrationFPL FlightPlanFIR FlightInformationRegionGDP GrossDomesticProductGHRs GroundHandlingRegulationsGPS GlobalPositioningSystemHF HighFrequencyIASA InternationalAviationSafetyAssessments/AuditIATA International Air Transport Association


ICAO International Civil Aviation OrganisationICT InformationCommunicationTechnologyIET InstituteofEngineersofTanzaniaISO International Standard OrganisationJNIA JuliusNyerereInternationalAirportKIA Kilimanjaro International AirportKRA KeyResultsAreaNAFISAT North-EasternAfricaandIndianOceanRegionVSATNetworkNACTE NationalCouncilforTechnicalEducationNC National Coordinator (for ICAO USOAP)NDB Non-DirectionalRadioBeaconNOF InternationalNOTAMOfficeNOTAM NotificationtoairmanOJT On-the-JobTrainingOPRAS OpenPerformanceReviewandAppraisalSystemPPRA PublicProcurementRegulatoryAuthorityRCC RescueCoordinationCentreRSC RescueSub-CoordinationCentreRVSM ReducedVerticalSeparationMinimumSAR SearchandRescueSIDS StandardInstrumentsDepartureRoutesSSI StationStandingInstructionsSMS SafetyManagementSystemSWOT Strengths,Weaknesses,OpportunitiesandThreatsTAISOA TanzaniaAeronauticalInformationOfficersAssociationTANEEA TanzaniaAirNavigationandElectronicsEngineersAssociationTANRs TanzaniaAirNavigationRegulationsTATCA TanzaniaAirTrafficControllersAssociationTCARs TanzaniaCivilAviationRegulationsUFIR UnifiedUpperFlightInformationRegionUACC Upper Area Control CentreUSAP UniversalSecurityAuditProgrammeUSOAP UniversalSafetyOversightAuditProgrammeVSAT VerySmallApertureTerminalVCCS VoiceCommunicationandControlSystemVHF VeryHighFrequencyVOR VeryHighFrequencyOmni-directionalRadioRangeWAN WideAreaNetworkYD YamoussoukroDecision


CHaIRMan’s sTaTeMenT

I am delighted once again to present theAuthority’sAnnualReportandAuditedAccountsfortheyearended30June,

2011.This istheeighthreportsincetheAuthoritywasestablishedinNovember2003.Thisgivesmeanother

opportunity to highlight to our stakeholders thesteadyprogressmadebytheAuthorityduringthepastyearandhowithasdischargeditsdutiesand

responsibilities as per its mandate.

During the period, the Authority continued to implement its second Five YearStrategicPlan,aswellastheassociatedBusinessPlanandBudget.Emphasishasbeenin

consolidatingtheachievementsmadeunderthefirstFiveYearPlan,withaviewtosteeringtheAuthority intoamoreeffectiveandefficientorganizationbybench-marking itsservicesagainstbest practices.

Withregardtosafety,inoverallterms,theindustrywasrelativelysafeduringtheperiodalthoughtherewere twelve incidents/accidents reported as compared to thirteen incidents/accidents in2009/10,whichisadecreaseofabout8%.TheAuthoritycontinuedtoimplementitsStateSafetyProgram(SSP),aswellasSafetyManagementSystem(SMS),inordertoimproveaviationsafetyin thecountry.However,effective implementationofSSPandSMSwasadverselyaffectedbydelayinissuanceofguidancematerialsbyICAO.

With regard to economic regulatory framework, theAuthority embarked on the revision ofAirServiceLicensingandGroundhandlingRegulations.TheReviewswerenecessitatedbychallengesfacedintheimplementationoftheseregulations.Furthermore,theobjectiveofthereviewwastoensurethateconomicregulatoryactivitiesactasacatalystratherthananimpedimenttoaviationdevelopmentinthecountry.

Financially,theAuthorityagainrecordedamodestsurplus,whichwasusedtoaugmentitsSpecialAccount,staffdevelopmentandcapitalexpenditure.However,themajorchallengesfacingtheAuthorityaretohaveadequatefinancialresourcestofunditsnowexpandedmandate,contributiontothenationalbudgetandhavinginplaceadequateandmodernairnavigationinfrastructure.

On behalf of the Board of Directors, I wish to thank all our stakeholders for their continuedcooperationandcommendtheManagementandStaffforworkingtogetherasateam.ThishasenabledtheAuthoritytoachievethepositiveresultsashighlightedintheReport.

Mwatumu J. MalaleChairmanoftheBoardofDirectors


DIReCToR GeneRal’s sTaTeMenT

During the year ended 30 June 2011, theAuthority continued to provide safety, security andeconomicoversightoftheaviationindustry,aswellas,theprovisionofairnavigationservices.TheAuthorityactivitiesduringtheyearwereinlinewiththe2009/10-2013/14StrategicPlan,whoseprimaryfocusistoensuresafe,secure,regularandsustainablecivilaviationindustry.

Withregardtosafety,theAuthorityinspected36operatorsandissuedAirOperatorsCertificate(AOC),outof38operatorsexpected.Further,120aircraft,outof186expectedwereinspectedforrenewalofcertificateofairworthiness.Also,11aircraftoperatorstrainingfacilities, includingsyntheticflighttrainers,wereinspected.

Economic oversight function continuedwith the review of theTanzaniaCivilAviation (GroundHandling Services) Regulations, 2007. The Authority also started the process to review theTanzaniaCivilAviation(LicensingofAirServices)Regulations,2006.

Passengertrafficincreasedfrom2,865,103passengersin2009/10to3,255,364passengersin2010/11,recordingagrowthof13.6%.Aircraftmovementsincreasedfrom170,777movementsto176,420movementsinthesameperiod,recordingagrowthof3.3%.Cargotrafficontheotherhand,grewfrom24,940.7tonsto36,673.9tonsin2009/10and2010/11respectively.

Withrespecttoairnavigationservices,airtrafficcontrolservicescontinuedtobeprovidedattheTCAA13StationsasperBusinessPlan.Also,AeronauticalSearchandRescueoperations inDaresSalaamFlightInformationRegion(FIR)continuedtobecoordinatedbytheAuthority.InviewofthisRescueCoordinationCentreatJNIAwasconstantlyinthestateofpreparednessforimmediateaction,intermsoffacilitiesanddata,aswellastrainedpersonnel.

Finally,IwouldliketotakethisopportunitytoexpressmysincereappreciationtotheAuhority’sstakeholdersfortheircooperation,whichhasenabledthecivilaviationindustry’sperformancetogenerallyimproveduringtheperiod,comparedtothepreviousyear.

fadhili J. ManongiDirector General


annUal RePoRT JUlY 2010 To JUne 2011

oPeRaTIonal PeRfoRManCe

During the period 2010/11, the performance of the Authority, measured against set targets wassatisfactory.Allkeyresultsareasoftheorganisationregisteredreasonableachievement.

1.0 safeTY anD seCURITY ReGUlaTIon

Various activities thatwere planned during the period for implementation and enforcement of theTanzaniaCivilAviationRegulations(TCARs)2006toensureacompliantindustrywerecarriedout.Thefollowingfiguresindicateperformanceinthespecificareas:

1.1 Personnel Licensing Section

FlightOperationsinspectionsandsurveillanceDuringtheyearthefollowingFlightoperationsandsurveillancewereconductedasperBusinessPlan.

Figure 1: Flight Operations Inspections and Surveillance

source: TCaa


Figure 2: Airworthiness Inspection and surveillance

source: TCaa

1.1.1 Examination

Atotalof428examinationswerebookedin2010/11comparedto562in2009/10recordinga13%decrease. This includedwrittenexaminations togetherwithvariousflying tests forgrant, renewal,conversion,extensionandvalidationoflicencesandcertificates.

Figure 3: Technical Examinations

source: TCaa


1.1.2 LicencesandCertificatesissued

Atotalof318licencesincludingcertificateswereissuedduring2010/11comparedto243in2009/10resultingina13%increaseasshowninthetablebelow.

Figure 4: Licence and Certificate

source: TCaa

1.1.3 Renewals

Atotalof696licencesincludingcertificatesandratingswererenewedduringtheperiodof2010/11comparedto570in2009/10thisis9%increase.


Figure 5: Licence/Certificate/Rating

source: TCaa

1.1.4 Endorsements

A total of 318 endorsementsweremade on various licences and certificates compared to 232 in2009/10resultingina15%increase.

Figure 6: Endorsement

source: TCaa


1.1.5 SaleofDocuments

Atotalof184variousdocumentsweresoldduringtheperiodof2010/11comparedto176in2009/10resultingina3%increase.

Figure 7: Sale of document

source: TCaa

1.1.6 Accidents and Incidents

Twelve accidents were reported during the period as compared to thirteen accidents reported in2009/10which is a decrease of about 10%.Sensitization is going on for implementation of safetymanagementsystemacrossallsafetyrelateddisciplinesintheaviationindustry.

2010/11 2009/10Incidents 9 0accidents 3 13Total 12 13


Figure 8: Accidents and Incidents

source: TCaa

1.1.7 AviationSecurity

TheAviationSecuritySectionestablishedabaselineof0(zero)actsofunlawfulinterferencefortheCountryforYear2009/10.

TheCivilAviation (Security)Regulations, 2007was reviewed.TheNationalCivilAviationSecurityProgramme (NCASP) andNational CivilAviation SecurityQuality Control Programme (NCASQP)werereviewedandamended.TheNationalCivilAviationSecurityTrainingProgramme(NCASTP)andCertificationofScreenerManualwerecombinedtoformtheNCASTPandtheoversightchecklistsforairport,aircraftaudit,inspectionandtestweredeveloped.Furthermore,3Airportsecurityprogrammes,5Airlinesecurityprogrammesand1CateringAgentSecurityProgrammewerereviewedandapproved.

Attotalof73securityoversightswereconductedin2010/11comparedto61conductedin2009/10asindicatedinthetable.Thiswasanincreaseof16%.Theoversightsinvolvedtheaudits,followupinspections and tests tasksof airports, aircraft, cateringandhandling agents’ security operations.Theoversightsassistedoperators to identify the security lapsesandmade immediate correctionsand those taking long timeandhugefinances,operators haveputupactionplans to remedy thedeficiencies.

02468

101214

Num

bers

2009/2010 2011/2010

Years

Accidents and Incidents

Incidents

Accidents

Total


aviationsecurityoversight

Figure 9: Oversight task

source: TCaa

Five airport committeemeetings and 3 interactivemeetingswith stakeholderswere conducted toencourage the industry to accept compliance responsibility. During the period, the National CivilAviationSecurityCommitteeheldfourmeetingsalso.Themeetingsgreatlycontributedinresolvingsecurityconcernsbyoperators.

In 2010/11, a total of 150 screener certificateswere issued/ renewed compared to 120 issued in2009/10,asshownintheTable.Thiswasanincreaseof20%.

Certificates Issued/ Renewals

s. no Certificate/Renewals 2010/11 2009/101 Screeners 150 120

source: TCaa


Figure 10: Certificate/Renewals

source: TCaa


2.0 eConoMIC ReGUlaTIon

2.1 AirTransportRegulation

During the financial year 2010/11, the Authority initiated a process to review the Tanzania CivilAviation(GroundHandlingServices)Regulations,2007.ThereviewwasnecessitatedbydifficultiesexperiencedduringtheimplementationoftheRegulationswhichwerepromulgatedintheyear2007.Thereviewisexpectedtobecompletedduringtheyear2011/12.

Furthermore,reviewoftheCivilAviationActwascompletedandthedraftlegislationwasforwardedtotheMinistryforfurtheraction.TheAuthorityalsostartedtheprocesstoreviewtheTanzaniaCivilAviation(LicensingofAirServices)Regulations,2006.

2.2 Licensingofairandgroundhandlingservices

Duringtheyearunderreview,theBoardheldtwoLicensingBoardMeetings(oneinOctober2010andtheotheroneinJune2011)andconsidered37(thirtyseven)and8(eight)applicationsforairandgroundhandlingservicesrespectively,asdetailedbelow:

2.2.1 Statusoflicensingofairservicesoperatorsin2010/11vs.2009/10

october/november May/June Total

approved Disapproved approved Disapproved approved Disapproved

2009/10 New applicants 2 0 10 0 12 0

Applicants for renewal/variation

17 0 26 0 43 0

Total 19 0 36 0 55 0

2010/11 New applicants 3 0 4 3 7 3

Applicants for renewal/variation

11 0 16 0 27 0

Total 14 0 20 3 34 3

source: TCaa


Figure 11: Status of licensing of air services operator

source: TCaa


2.2.2 Statusoflicensingofgroundhandlingservicesoperatorsin2010/11vs.2009/10

october/november May/June Total

approved Disapproved approved Disapproved approved Disapproved

2009/10 New applicants

3 1 7 1 10 2

Applicants forrenewal/variation

0 0 0 1 0 1

Total 3 1 7 2 10 3

2010/ 11 New applicants

4 0 3 0 7 0

Applicants forrenewal/variation

1 0 0 0 1 0

Total 5 0 3 0 8 0

source: TCaa

Figure 12: Status of licensing of ground handling services operators

source: TCaa


2.3 BilateralAirServicesAgreements(BASAs)

s/no. Year Country Date1. New BASAs negotiated 2009/10 •Turkey

•Jordan•Bahrain

October2009February2010November2009

2010/11 Nil

2. BASA reviewed 2009/10 •Kenya•Mozambique•DRC

July2009July2009February2010

2010/11 Kenya February2011

3. BASA signed 2009/10 •Mozambique•Turkey

August2009February2010

2010/11 Jordan February2011

source: TCaa

2.4 Coordination of facilitation of Air Transport

During the period under review, two NationalAir Transport Facilitation (National FAL) CommitteemeetingsandtwoEastAfricanconsultations(EastAfricanFAL)meetingsonairtransportwereheld.

The29thand30thNationalFALmeetingswereheld inMwanzaandZanzibar inNovember2010andMay2011respectively.TheEastAfricanFALmeetings(29thand30th)wereheldinBujumbura,BurundiandMombasa,KenyainDecember2010andMay2011respectively.

2.5. Statistical Reports

TheStatisticalReportfor2010wasout inOctober,2011,whilefour(4)quarterlyStatisticalreportswereissuedinNovember2010,February2011,May2011andAugust2011.

2.6. TrafficPerformance

Atotalof32,649 internationalaircraftmovementswerehandled in thecountry in theyear2010/11recordingagrowthby35.6%.Thecountryhandled24,085movementsin2009/10.Thecorrespondingnumberofpassengershandledincreasedby15.6%,fromatotalof1,289,191passengersin2009/10to1,490,130passengersin2010/11.TheincreasesinbothaircraftmovementsandpassengersarearesultofintroductionofservicesbyTurkishAirlines,ComAirLtd,resumptionofservicesbyOmanAir,expansionofservicesbyFiveForty(540)Aviation(K)LtdandincreaseoffrequenciesbyKenyaAirways,QatarAirwaysandEthiopianAirways.

Internationalcargohandledincreasedby51%,from22,216tonsin2009/10to33,548tonsin2010/11.


Thiswasdue to increaseof frequenciesbyKenyaAirways,QatarAirways,EthiopianAirlinesandcommencementofservicesbyTurkishAirlines.

Domesticaircraftmovementsontheotherhanddecreasedby2%,from146,692movementsin2009/10to143,771movementsin2010/11.ThiswasaresultofsuspensionofservicesbyATCL.However,thecorrespondingdomesticpassengersrecordeda12%increasefrom1,575,912passengersin2009/10to1,765,234passengersin2010/11whichwasduetoincreasedtouristarrivalsconnectingtodomesticdestinations.

Domesticcargoincreasedfrom2,726tonsin2009/10to3,126tonsin2010/11,equivalentto14.6%increase.ThisisaresultofincreaseintourismandexpansionofservicesbyFly540andPrecisionAirServicesLtdwhichincreasedflightstoArushaandKilimanjaroto3timesdailyfromtheprevious2flights.

Theshareofdomestic trafficwentdown to54% from theprevious55%,since international trafficregisteredahigherpercentagegrowthof15%comparedto12%growthindomestictraffic,between2009/10and2010/11.

Overall trafficperformanceof the industry recordedagrowthof3.3% inaircraftmovements, from170,777in2009/10to176,420in2010/11.

Figure 13: Aircraft Movements in 2009/10 and 2010/2011

source: TCaa

Overall passenger traffic increased from2,865,103 tons in 2009/10 to3,255,364 tons in 2010/11,equivalentto13.6%increase.


Figure 14: Passenger Traffic in 2009/10 and 2010/2011

source: TCaa

Overallcargorecordeda47%increase,from24,940.7tonsin2009/10to36,673.9tonsin2010/11.

Figure 15: Cargo Traffic (Tons) in 2009/10 and 2010/2011

source: TCaa


3.0 aIR naVIGaTIon seRVICes

Duringthisperiod, theperformanceof theDivision,measuredagainstset targetswassatisfactory.Specifically,thefollowingwastheperformancelevelsinthevariouskeyresultsareas:

3.1 Air Navigation Services

Duringthisperiod,theAuthorityprovidedairtrafficservicesintheDaresSalaamFlightInformationRegion(FIR),includingtheairspaceabove24,500feetovertheterritoriesofBurundiandRwanda,satisfactorily.Operationandmaintenanceofcommunication,navigationandsurveillancefacilitiesinthecountrywerecarriedoutsatisfactorilyalsoandinaccordancewiththeAfrica-IndianOcean(AFI)AirNavigationalPlan.Theservicetargetsreachedinthespecificareasareasfollows:

3.1.2 AirTrafficIncidents

During the year, 4 incidents (all ‘AIRPROX’)were reported out of 75,393movements at the areacontrolcentre(ACC),givingarateof0.53incidentsper10,000aircraftmovements.Thisisadeclineby6%ofthesettarget(0.50)andanimprovementby13.1%bylastyearrate(0.61%).

3.1.3 ProficiencyandadequacyofStaff

Theproficiencyoftheairtrafficcontrollersearmarkedforcheckingwasundertakenasplanned.Further,during the period,more than95%of the training of air traffic controllers, aeronautical informationofficersandairnavigationengineerswascompleted.Fourairnavigationengineerswere recruited().Therecruitmentof8AIOswillbedoneinnextfinancialyear.Additionally13ATMOtraineeswhosuccessfullypassedinstructionalaerodromecontrolcourseandonjobtraining(OJT)wereemployedasATMO-Aerodrome

3.1.4 AvailabilityofNewCNSfacilities

Duringthisperiod,newNDBswereinstalledinDodoma,PembaandArusha.VHFMAIN/STANDBYandTransceiversequipmentwereinstalledatArusha,Dodoma,IringaandMbeya.Inaddition,newVoicerecordingsystemswereinstalledatMwanza,ArushaandZanzibar.

3.1.5 Operationoffacilitiesatoptimumlevel

Allthefacilitiesweremaintainedonaregularbasisasprogrammed.Sparesavailabilityimprovedandanaverageequipmentserviceabilityof98%wasattained.Thedetailedserviceabilityofthedifferentfacilitieswasasfollows:

• BothNavigationAidsandSurveillanceequipmentoperatedatserviceabilitylevelof99%.


• ServiceabilityoftheVHFAreaCoveraveragedat99%duringtheyearwhiletheserviceabilityoftheVHFstationradioswas100%

• ServiceabilityoftheATSDSlinkwas99%

• WithregardtotheAeronauticalFixedTelecommunicationNetwork,serviceabilityoftheequipmentfortheyearwas98%fortheinternationalcircuitsand77%forthedomesticcircuits.

3.1.6 AirTrafficServices

AirTrafficControlservicescontinuedtobeprovidedon24hoursbasisattheAreaControlCentre,JuliusNyerereandZanzibarInternationalAirports.AtMwanzaAirportserviceswereprovidedfor17hourscommencingfrom06:00amandoccasionallyextendedtocaterfornon-scheduledflights.Attheremaining11airports,serviceswereprovidedduringdaytime.

TwentyfourhoursterminalradarcontrolservicescontinuedtobeprovidedatDaresSalaamandarearadarservicewasavailableforen-routeairtrafficwithintheEasternsector.

Duringthisperiod,thenumberofaircraftmovementshandledbytheDaresSalaamAreaControlCentreincreasedby13.6%,from65,151to75,393.

At the thirteen airports in Tanzania where the Authority provides air traffic control services, thetotal aircraftmovements increasedby25.1%, comparedwith theprevious year, i.e. from116,782movementsin2009/10to155,992movementsin2010/11.

Figure 16: Air Traffic Movements at Airports

source: TCaa


Figure 17: Total Number of Air Traffic Movements by Months

source: TCaa

Figure 18: Total Number of Air Traffic Movements by Months

source: TCaa

3.1.7 AeronauticalInformationServices

Twenty-fourhourservicecontinuedtobeprovidedatJNIAandZanzibarwhile12hourservicewasprovidedatArusha,Dodoma,and13hrsatTerminalOne(atJNIA).Similarly,14hourservicewasprovidedatMwanzaAirports.

Duringtheyear,theInternationalNOTAMOffice(NOF)handled69,117foreignNOTAMscompared

Domestic and International Air Traffic Movement

0

500

1000

1500

2000

2500

3000

3500

4000

4500

July

August

Septem

ber

Octobe

r

Novem

ber

Decem

ber

Jan

Feb MarApri

lMay

June

Months

Num

ber o

f Mov

emen

t


to57467inthepreviousyearandissued808NOTAMsrelevanttoTanzaniacomparedto784in2009/10.Additionally, 7,424Aeronautical Pre-Flight Information Bulletins (PIB) were provided toairlines operating at JNIA compared to 6088 in 2009/10. Other targets achieved with regard toprovisionofAISareasdetailedhereunder:

• Provisionofaeronauticalinformationonatimelybasis

Fouramendments to theAIPwere issuedthisyear.AerodromeIndexChartandATSRouteStructureinFIRchartwereupdatedandreissued,followingchangesinadditionalairstripsandroutesrespectively.

• AeronauticalFixedServices

Thenumberofmessageshandledwas2,546,996(International1,000,812Domestic1,546,184)compared to 2,021,193 (International 860,638Domestic 1,160,555)messages handled theprevious year. Most of the international messages are transit traffic between Nairobi andJohannesburgCentres.

3.1.8 TheCivilAviationTrainingCentre

• The Civil Aviation Training Centre continued offering aviation related training courses totheAuthority and the industry fromwithin and also from neighbouring/regional countries ofBotswana,Namibia,Uganda,Rwanda,andBurundi.

• During theyear, theCentreconducteda totalof20courses involving283participants,173malesand110femaleswhocomprise196localstudentsand87internationalstudents.Thetotal revenue generated from courses was 37,790,000 Tanzanian shillings and 82,542 USDollars.

• Duringtheperiod,theCentre’scapacitywasupliftedbyrecruitingtwo(2)Instructorsandtrainingten(10)instructorsinvariousprofessionalsandacademiccourses.Two(2)Instructorswereretiredduringtheperiodandtheirpositionshavebeencovered.

• FullaccreditationfromNACTEhasbeenpursuedduringtheperiod.TheCurriculumdevelopmentexercisewhichinvolvedlabourmarketdemandsurveywascompleted.Thenextstagewhichinvolvepre-curriculumwriteupisinprogress.

• Six(6)InstructorswereregisteredbyNACTEaftermeetingthebasicrequirements.

• IntheeffortsofattainingcertificationfromTCAA,CATChasengagedinpreparationofTrainingandProceduresManual.Thedocumentisreadyandthenextstagewhichinvolvesevaluation,demonstration and inspection is in progress.

4.0 CoRPoRaTe seRVICes

4.1 HumanResources

Asof30June2011,theAuthorityhadatotalnumberof387outofwhom264weremalesand123werefemales.TheAuthoritycontinuedtorecruitnewemployeestofillvacantpositionswhicharoseduetoresignation,retirementandretrenchment.Duringtheperiodunderreviewatotaloften(10)newstaffwererecruited.

Duringthisperiod,theAuthoritycontinuedtoimplementthethreeyeartrainingprogramme(2009/2010–2010/2012).Fortheyearunderreview,atotalof138staffweretrained,63staffshorttermcoursesand66staffoncorporatecourses.66staffattendedinductioncourse.


DuetolabourmobilityatotalnumberofonestaffsterminatedhiscontractswiththeAuthorityandjoinedotherinstitution.

Atotalnumberofsix(6)staffretiredduringtheperiodunderreviewafterattainingthecompulsoryretirement age.

4.1.1 Procurement

Duringtheperiodunderreview,theAuthoritycontinuedtoimplementthePublicProcurementActandPPRArequirementandpreparedanAnnualprocurementPlanasoneoftherequirementsoftheProcurementAct.andPPRA.

ThefollowingmajorProcurementsofgoodsandservicesweredoneduringthisperiod:

(i) SupplytwodoublecabinsforKigomaandMtwarastationsforoperations.

(ii) ProcurementofMultichannelRecordersforArusha,MwanzaandZanzibar.

(iii) ProcurementofstaffuniformsfortheAuthority’sstaff

(iv) ProcurementofofficemachinesandInformationTechnologyEquipment

(ComputersandAccessories.)

(v) ProcurementofAirnavigationequipments.

(vi) ConstructionofofficepartitioningforCentralworkshopatChang’ombeCentralstores.

4.1.2 AviationHouse

TheAuthoritycontinued implementationof theConstructionofAviationHouse. TheconstructionworkswerecompletedinFebruary2011andrelocationoftheHeadOfficeofficestothenewbuildingwasdonewitheffectfrom6March2011.

THE UNITED REPUBLIC OF TANZANIA NATIONAL AUDIT OFFICE

REPORT OF THE CONTROLLER AND AUDITOR GENERAL

ON THE FINANCIAL STATEMENTS OF THE

TANZANIA CIVIL AVIATION AUTHORITY

FOR THE YEAR ENDED 30TH JUNE, 2011

The Controller and Auditor General

National Audit O�ce,

Samora Avenue/Ohio Street,

P. O. Box 9080

Dar es Salaam

Telegram: “Ukaguzi”

Telephone: 255 22 2115157/8

Fax: 255 22 2117527

E-mail: [email protected]

March, 2012


TANZANIACIVILAVIATIONAUTHORITY 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)

Thestatutorydutiesandreponsibilitiesof theControllerandAuditor General are givenunder Article 143 fo theConstitution of theURTof 1977 (revised2005)andfurtherelaboratedunderSect.10(1)ofthePublicAuditActNo.11of2008.

Vision Tobeacentrefoexcellenceinpublicsectorauditing

Mission Toprovideefficientauditservicesinordertoenhanceaccountabilityandvalue

formoneyinthecollectionanduseofpublicresources.

In providing quality services, nao is guided by the following Core Values: ✓ objectivity :Weareanimpartialorganization,offeringservicestoourclients

inanobjective,andunbiasedmanner; ✓ excellence : We are professionals providing high quality audit services

basedonbestpractices; ✓ Integrity:Weobserveandmaintainhighstandardsofethicalbehaviorand

theruleoflaw; ✓ People focus:We focus on stakeholders’ needs by building a culture of

goodcustomercareandhavingcompetentandmotivatedworkforce; ✓ Innovation: We are a creative organization that constantly promotes a

cultureofdevelopingandacceptingnewideasfrominsideandoutsidetheorganization;and

✓ best resource utilization:We are an organization that values and usespublicresourcesentrustedtoitinefficient,economicandeffectivemanner.

We do this by:- • Contributingtobetterstewardshipofpublicfundsbyensuringthatourclients

areaccountablefortheresourcesentrustedtothem; • Helpingtoimprovethequalityofpublicservicesbysupportinginnovationon

theuseofpublicresources; • Providingtechnicaladvicetoourclientsonoperationalgapsintheiroperating

systems; • Systematicallyinvolveourclientsintheauditprocessandauditcycles;and • Providingauditstaffwithadequateworkingtoolsandfacilitiesthatpromote

independence.

© This report is intended to be used by Tanzania Civil Aviation Authority. However, upon receipt and adoption of this report by the TCAA Board of Directors, the report becomes a matter of public record and its distribution may not be limited.


TANZANIACIVILAVIATIONAUTHORITY

CORPORATEINFORMATION

DIRECTORS Mrs.MwatumuJ.Malale Chairman Mr.MbwanaJ.Mbwana ViceChairman Mrs.MargaretT.Munyagi DirectorGeneral(Retiredon14October2010) Mr.FadhiliManongi DirectorGeneral(Appointedon14October2010) Hon.ThuwaybahKissasi Director(Non-Executive) Prof.ArnoldTemu Director(Non-Executive)

AUTHORITYSECRETARY Tanzania Civil Aviation Legal Department AviationHouse Nyerere/KitundaRoad Junction P.O.Box2819 Dar-es-Salaam Tanzania

REGISTEREDOFFICE AviationHouse Nyerere/KitundaRoadJunction P.O.Box2819 Dar-es-Salaam Tanzania

BANKERS NationalBankofCommerceLimited CorporateBranch Dar-es-Salaam Tanzania

NMBBankPlc BankHouseBranch Dar-es-Salaam Tanzania

CRDBBankPlc AzikiweBranch Dar-es-Salaam Tanzania



RePoRT of THe DIReCToRsfoR THe YeaR enDeD 30 JUne 2011

The directors are pleased to present their report and the audited financial statements for the year ended30June2011.

esTablIsHMenT anD aCTIVITIes

The Tanzania Civil Aviation Authority also referred to as “TCAA” or “the Authority” was established on 1November2003asacorporatebody,pursuanttotheTanzaniaCivilAviationAuthorityAct2003(ActNo.10of2003)whichasbeenconsolidatedwiththeCivilAviationAct1977(ActNo.13of1977)andnowtitledastheCivil Aviation Act (CAP 80) of 2006.

ThisActmandatestheAuthoritytoregulatetheactivitiesofpersonsandinstitutionscarryingoutairservices,aeronauticalairportservicesandairnavigationservicesaswellascontinuewith theprovisionofnavigationservices.

ResUlT foR THe YeaR

Theresultsfortheyeararesetoutonpage8ofthesefinancialstatements.

DIReCToRs

ThedirectorsoftheAuthorityatthedateofthisreportandthosewhohaveservedduringtheyeararesetouton page 2.

DIReCToR’s InTeResT

TheauthorityiswhollyownedbytheGovernmentoftheUnitedRepublicofTanzania.DirectorsdonothaveanyinterestintheAuthority.

RelaTeD PaRTY TRansaCTIons

Detailsoftransactionswithrelatedpartiesaredisclosedinnote24ofthefinancialstatements.Alltransactionswithrelatedpartieswereundertakenonarm’slengthbasis.

eMPloYees WelfaRe

Therelationshipbetweenmanagementandemployeescontinuedtobegood.Attheyearend,therewerenounresolvedcomplaintsreceivedfromemployees.

TheAuthorityhadatotalof386employeesasat30June2011(2010:totalof393employees)outofwhich263or 68 percent were male and 123 or 32 percent were female.

employment Policy

TanzaniaCivilAviationAuthority iscommitted toemploymentpolicieswhich followbestpractices,basedonequalopportunity forall employees irrespectiveof sex, race, religious,disability, ageormarital status.TheAuthority recognizes theneed for ensuring fair employmentpractices in recruitment and selection, and theretention,trainingandcareerdevelopmentofstaff.AsameasuretowardimprovingEmployer/Employeegoodrelationship,duringtheyear2011managementconvenedonemeetingwithallstaff.

Management/employees Relationship

Therelationshipbetweenmanagementandstaffiscordial.Employeesareinvolvedinmajorchangesaffectingthemthroughsuchmeasuresasmonthlydepartmentalmeetings,internalcommunicationandworkerscouncilmeetings. There are well established procedures, including regular meeting with trade union (TUGHE), toensurethattheviewsofemployeesaretakenintoaccountinreachingdecisions.



RePoRT of THe DIReCToRs (ConTInUeD)

eMPloYees WelfaRe (Continued)

Training

TheAuthorityregardstrainingasinvestmentinhumanresources.TheAuthority,therefore,setsasidesufficientresourcesinitsannualbudgetandplanstomeetingtrainingobjectives.Allemployeesaretrainedwiththeaimofequipping themwithknowledge,skills,attitudeandabilitiesnecessary toachieveTanzaniaCivilAviationAuthoritystrategicgoals.TrainingisnormallycarriedoutwithfocusoncorebusinessoftheAuthorityacademicandprofessional improvementand technicalprograms.Training isconducted inaccordancewithanannualtrainingprogramdrawnfromtrainingneedsassessment,which takes intoaccount identifiedskillsgapsandexposuretonewandeverchangingworkingandbusinessenvironment.ThisguaranteesavailabilityofhighcaliberemployeescapableofmeetingtheAuthority’svisionandmission.

Medical assistance

TheAuthoritymeetsmedicalexpensesofitsemployeesandtheirimmediatedependantsthroughcontributingtoNationalHealthInsuranceFund(NHIF).

HIV/aIDs Policy

TheAuthorityHIV/AIDSpolicyfocusesoncreatingawarenessonHIV/AIDSamongstaffmembersbyprovidingthemwithupdateinformationonHIV/AIDSwithemphasisonthepreventivestrategiesandeducationagainstthe pandemic. The policy also focuses on encouraging employees to undertake voluntary counseling andtesting (VCT).

financial support

Loans,salaryadvancesandotherfinancialassistanceareavailabletoallconfirmedemployeesinaccordancewithapprovedstaffpoliciesandpractices.

solVenCY

ThestateofaffairsoftheAuthorityasat30June2011issetoutonpage9ofthesefinancialstatements.ThedirectorsconsidertheAuthoritytobesolvent.

aUDIToRs

Deloitte&Touchewerethe independentauditorsof theAuthority for thefinancialyearended30June2011followingtheirre-appointmentbytheControllerandAuditorGeneral.

bY oRDeR of THe boaRD

______________________________Mr.MbwanaJ.MbwanaVice Chairman

______________________ 2012



sTaTeMenT of DIReCToRs’ ResPonsIbIlITIes

TheTanzaniaCivilAviationAuthorityActNo.13of1997asamendedin2006requirethedirectorstopreparefinancial statements foreachfinancial yearwhichgivea trueand fair viewof thestateofaffairsof theAuthorityasattheendofthefinancialyear,andoftheresultsfotheAuthorityforthatyear.ItalsorequiresthedirectorstoensurethattheAuthoritykeepsproperaccountingrecordswhichdisclosewithreasonableaccuracyatanytimethefinancialpositionoftheAuthority.TheyarealsoresponsibleforsafeguardingtheassetsoftheAuthority.

The directors are responsible for the preparation and fair presentation of these financial statements inaccordancewith International FinancialReportingStandards and themanner required by theTanzaniaCivilAviationAuthorityAct.No.13of1997asamendedin2006,andforsuchinternalcontrolsasdirectorsdetermine are necessary to enable the preparation of financial statements that are free frommaterialmisstatement,whetherduetofraudorerror.

Thedirectorsaccept responsibility for theannualfinancialstatements,whichhavebeenpreparedusingappropriate accounting policies supported by reasonable and prudent, judgements and estimates, inconformitywithInternationalFinancialReportingStandardsandTanzaniaCivilAviationAuthorityActNo.13of1997asamendedin2006.ThedirectorsareoftheopinionthatthefinancialstatementsgiveatrueandfairviewofthestateofthefinancialaffairsoftheAuthorityandofitsoperatingresults.Thedirectorsfurtheracceptresponsibilityforthemaintenanceofaccountingrecordswhichmayberelieduponinthepreparationoffinancialstatements,aswellasadequatesystemsofinternalfinancialcontrol.

Nothinghascome to theattentionof thedirectors to indicate that theAuthoritywill not remainagoingconcernatleastforthenexttwelvemonths.

______________________________ _______________________Mr.MbwanaJ.Mbwana Prof.ArnoldTemuVice Chairman Director

____________________ 2012 _____________________ 2012


To: The Chairman, board of Directors, Tanzania Civil aviation authority, P.o. box 2819, Dar es salaam,

RePoRT of THe ConTRolleR anD aUDIToR GeneRal on THe fInanCIal sTaTeMenT of THe TanZanIa CIVIl aVIaTIon aUTHoRITY foR THe YeaR enDeD 30TH JUne 2011

IntroductionIhaveauditedtheaccompanyingfinancialstatementsof theTanzaniaCivilAviationAuthority, which comparises the statement of financial position as at 30th June,2011,and thestatementofcomprehensive income,statementofchanges inequityandstatementofcashflowsfor theyear thenended,andthenotes to thefinancialstatements which includes a summary of significant accounting policies and otherexplanatorynotessetoutonpages8to33ofthisreport.

Directors’ Responsibility for the financial statementsTheBoardofDirectorsoftheTanzaniaCivilAviationAuthority isresponsibleforthepreparationandfairpresentationofthesefinancialstatementsinaccordancewiththeInternational Financial Reporting Standards. This responsibility includes designing,implementing andmaintaining internal controls relevant to the preparation and fairpresentationoffinancialstatementsthatarefreefrommaterialmisstatements,whetherdue to fraud or error, selecting and applying appropriate accounting policies andmakingaccountingestimatesthatarereasonableinthecircumstances.

Responsibilities of the Controller and auditor GeneralMy responsibility as auditor is to express an independent opinion on the financialstatements based on the audit. The audit was conducted in accordance with theInternational Standards onAuditing (ISA), the International Standards of SupremeAuditInstitutions(ISSAI),andsuchotherauditproceduresIconsiderednecessaryinthecircumstances.Thesestandards require that Icomplywithethical requirementsandplan andperform the audit to obtain reasonable assuranceaboutwhether thefinancialstatementsarefreefrommaterialmisstatements.

Anauditinvolvesperformingprocedurestoobtainauditevidenceabouttheamountsanddisclosuresinthefinancialstatements.Theproceduresselecteddependontheauditor’sjudgement,includingtheassessmentoftherisksofmaterialmisstatementsof the financial statements, whether due to fraud or error. In making those riskassessments, the auditor considers internal controls relevant to the Authority’spreparationandfairpresentationofthefinancialstatementsinordertodesignauditprocedures that are appropriate in the circumstances, but not for the purpose ofexpressing an opinion on the effectiveness of theAuthority’s internal controls. Anauditalsoincludesevaluatingtheappropriatenessoftheaccountingpoliciesusedandthe reasonablenessof theaccountingestimatesmadebymanagement, aswell asevaluatingtheoverallpresentationofthefinancialstatements.

Inaddition,Section10(2)of thePAAof2008requiresme tosatisfymyself that theaccountshavebeenprepared inaccordancewithappropriateaccountingstandardsand that, reasonable precautions have been taken to safeguard the collection ofrevenue,receipt,custody,disposal,issueandproperuseofpublicproperty,andthatthe law,directionsand instructionsapplicabletheretohavebeendulyobservedandexpendituresofpublicmonieshavebeenproperlyauthorized.


Furthermore, Section 44(2) of the Public Procurement Act No. 21 of 2004 andRegulation 31 of the Public Procurement (Goods,Works, Non-Consultant ServicesandDisposalofPublicAssetsbyTender)Regulations2005requiresmetostateinmyannualauditreportwhetherornottheauditeehascompiledwiththeprovisionsoftheLawanditsRegulations.

IbelievethatthatauditevidenceIhaveobtainedissufficientandappropriatetoprovideabasisformyauditopinion.

Unqualified OpinionIn my opinion, the financial statements present fairly, in all material respects, thefinancialpositionoftheTanzaniaCivilAviationAuthorityasof30thJune,2011anditsfinancialperformanceanditscashflowsfortheyearthenendedinaccordancewiththeInternational Financial Reporting Standards.

Report on other legal and Regulatory Requirements

Compliance with Public Procurement actInviewofmyresponsibilityontheprocurementlegislation,andtakingintoconsiderationtheprocurement transactionsandprocesses Ihave reviewedaspartof thisaudit, IstatethatTanzaniaCivilAviationAuthorityprocurementhasgenerallycompliedwiththerequirementsofthePublicProcurementAct,2004anditsrelatedRegulationsof2005.

LudovickS.L.UtouhConTRolleR anD aUDIToR GeneRal

OfficeoftheControllerandAuditorGeneral,NationalAuditOffice,DaresSalaam,Tanzania

20thMarch,2012


TANZANIACIVILAVIATIONAUTHORITYSTATEMENTOFCOMPREHENSIVEINCOMEFOR THE YEAR ENDED 30 JUNE 2011

note 2011 2010 TZs ‘000 TZs ‘000

Revenue 4 22,497,084 18,486,873

OtherIncome 52,656 82,328

Operatingandadministrativeexpenses 5 (11,790,219) (10,730,167)

Staff costs 7 (9,129,727) (6,846,744)

Interestincome 199,102 508,864

Interestexpense 8 (221,132) -

surplus for the year 9 1,607,764 1,501,154

other comprehensive income

Gainonavailableforsaleinvestments 13 1,188 1,486

Totalcomprehensiveincome 1,608,952 1,502,640



STATEMENTOFFINANCIALPOSITIONAS AT 30 JUNE 2011

note 2011 2010 TZs ‘000 TZs ‘000

asseTsnon current assets 11 25,484,620 23,468,754Propertyandequipment 12 133,483 422,630Intangible assets 25,618,103 23,891,384

Current assetsAvailableforsaleinvestment 13 14,261 13,073Inventory 14 1,238,705 403,468Tradeandotherreceivables 15 3,608,893 2,932,193Termdeposits 16 4,394,608 7,287,926Cashandbankbalances 3,488,434 4,071,599

12,744,901 14,708,259

Total assets 38,363,004 38,599,643

eQUITY anD lIabIlITIesCapital and ReservesCapitalfund 18 6,694,229 6,694,229Investmentrevaluationreserves 11,030 9,842Accumulatedsurplus 19 20,271,155 18,663,391

Total equity 26,976,414 25,367,462

lIabIlITIesnon-current liabilitiesBorrowings 20 7,528,491 7,967,735Gratuitypayable 21(iii) 913,215 795,695

8,441,706 8,763,430

Current liabilitiesBorrowings 20 1,037,393 2,128,897Fundsheldforspecialproject 22 330,114 330,114Tradeandotherpayables 23 1,577,377 2,009,740

Total liabilities 2,944,884 4,468,751

Total equity and liabilities 38,363,004 38,599,643

Thefinancialstatementsonpages8to33wereapprovedbytheboardofdirectorson..................2012andweresignedonitsbehalfby:

Mr.MbwanaJ.Mbwana Prof.ArnoldTemuVice Chairman Director


TANZANIACIVILAVIATIONAUTHORITYSTATEMENTOFCHANGESINEQUITYFOR THE YEAR ENDED 30 JUNE 2010

Investment Capital revaluation accumulated fund reserve surplus Total equity TZs ‘000 TZs ‘000 TZs ‘000 TZs ‘000

at 1 July 2009 6,694,229 8,356 17,162,237 23,864,822

Surplusfortheyear - - 1,501,154 1,501,154

other comprehensive income:

Gainonavailableforsaleinvestment(Note12) - 1,486 - 1,486

at 30 June 2010 6,694,229 9,842 18,663,391 25,367,462

at 1 July 2010 6,694,229 9,842 18,663,391 25,367,462

Surplusfortheyear - - 1,607,764 1,607,764

other comprehensive income:

Gainonavailableforsaleinvestment(Note12) - 1,188 - 1,188

at 30 June 2011 6,694,229 11,030 20,271,155 26,976,414



STATEMENTOFCASHFLOWSFOR THE YEAR ENDED 30 JUNE 2011

note 2011 2010 TZs ‘000 TZs ‘000

oPeRaTInG aCTIVITIessurplus for the year 1,607,764 1,501,154Adjustmentsfor:Depreciationandamortization 2,252,666 1,618,813

Operatingsurplusbeforeworkingcapitalchanges 3,860,430 3,119,967

Working capital changes(Increase)/decreaseinventories (835,237) 72,544Increaseintradeandotherreceivables (676,700) (100,713)Increaseingratuitypayable 117,520 171,128(Decrease)/increaseintradeandotherpayables (432,364) 877,095

net cash from operating activities 2,033,649 4,140,021

INVESTING ACTIVITIESAcquisitionofproperty,plantandequipment (3,979,385) (10,151,880)Acquisitioninintangibleassets - (164,166)Movementintermdeposits 221,131 (1,493,133)

net cash used in investing activities (3,758,254) (11,809,179)

FINANCING ACTIVITIES

Netborrowings(repaid)/received (1,530,747) 2,365,723

Netcashgeneratedfromfinancingactivities (1,530,747) 2,365,723

(Decrease)/increaseincashandcashequivalent (3,255,352) (5,303,435)

Cashandcashequivalentsatthebeginningoftheyear 9,504,326 14,807,761

Cashandcashequivalentsattheendoftheyear 17 6,248,974 9,504,326



NOTESTOTHEFINANCIALSTATEMENTSFOR THE YEAR ENDED 30 JUNE 2011

1. SIGNIFICANT ACCOUNTING POLICIES

statement of compliance

ThefinancialstatementshavebeenpreparedinaccordancewiththeInternationalfinancialReportingStandards.Theprincipalaccountingpoliciesadoptedinthepreparationofthesefinancialstatementsarestatedbelow:

(i) Newstandardsandamendmentstopublishedstandardseffectivefortheyearended30June2011.

new and revised standards affecting presentation and disclosure only

Effectiveforannualperiods beginning on or after Amendments and revised standards

VariousimprovementsresultingfromApril2009Annual 1January2010 improvements to IFRSs

IAS32,FinancialInstruments:Presentation- 1February2010 amendmentsrelatingtoclassificationofrightsissues

ImprovementstoIFRSs(2010) 1July2010

New Interpretation

IFRIC19,ExtinguishingFinancialLiabilitieswithEquity 1July2010 Instruments

(ii) Relevant newand amended standards in issue but not yet effective in the year ended 30June2011

Effectiveforannualperiods beginning on or after

New and Amendments to standards

IFRS7,FinancialInstruments:Disclosures- 1July2011 amendmentsenhancingdisclosuresabouttransfersof financialassets

IFRS9,FinancialInstruments-Classificationand 1January2013 Measuremets(2010)

IAS24,RelatedPartyDisclosures-reviseddefinitionof 1January2011 related parties

VariousimprovementsresultingfromMay2010Annuay 1January2011 Improvements to IFRSs

IAS1,PresentationofFinancialStatements- 1July2012 Presentationofitemsofothercomprehensiveincome

IAS19,EmployeeBenefits(2011) 1January2013

IFRS12,DisclosureofInterestsinOtherEntities 1January2013

IFRS13,FairValueMeasurement 1January2013



NOTESTOTHEFINANCIALSTATEMENTS(CONTINUED)

1. sIGnIfICanT aCCoUnTInG PolICIes (Continued)

(iii) Impactofnewandamendedstandardsandinterpretationsonthefinancialstatementsfortheyearended30June2011

amendments to IfRs 7 financial Instruments: Disclosures

These make amendments to IFRS 7 Financial Instruments: Disclosures resulting from the IASB’scomprehensivereviewofoffbalancesheetactivities.

Theamendmentsintroduceadditionaldisclosures,designedtoallowusersoffinancialstatementstoimprovetheirunderstandingoftransfertransactionsoffinancialassets(forexample,securitisations),includingunderstandingthepossibleeffectsofanyrisksthatmayremainwiththeentitythattransferredtheassets.Theamendmentsalsorequireadditionaldisclosuresifadisproportionateamountoftransfertransactionsareundertakenaroundtheendofareportingperiod.

Various improvements resulting from april 2009 annual improvements to IfRss

A number of the amendments in this tranche are largely technical, clarifying particular terms, oreleminatingunintendedconsequences.Otherchangesaremoresubstantial,suchasthecurrent/non-currentclassificationofconvertibleinstruments,theclassificationexpendituresonunrecognisedassetsinthestatementofcashflowsandtheclassificationofleasesoflandandbuildings.

Ias 32, financial Instruments: Presentation

Amendmentsrelatingtoclassificationofrightsissues

(iv)Earlyadoptionofstandards

TheAuthoritydidnotearly-adoptanyneworamendedstandardsduringtheyear

basis of accounting

Thefinancialstatementshavebenpreparedonthehistoricalcostbasis,exceptfortherevaluationofequityshareswhichcarriedatfairvalue.

Revenue Recognition

RevenueisrecognisedtotheextentthatitisprobablethateconomicbenefitswillflowtotheAuthorityand the revenue can be reliablymeasured. Revenue on provision of services is recognised whenserviceshavebeenprovidedtotheoperator.

accounting for grants

Agrantisrecognisedasincomeonacashbasisi.e.whenreceived.Grantsreceivedfromdonorsinrespect of capital expenditureare crediteddirectly toanappropriate capital grantsaccount.Grantsreceived inrespectofrevenueexpenditurearecreditedto incomeandexpenditurestatement inthesameperiodinwhichtherelatedrevenueexpenditureischarged.

Interest Income

Interestincomeisaccruedonatimebasis,byreferencetotheprincipaloutstandingandattheeffectiveinterestrateapplicable,whichistheratethatexactlydiscountsestimatedfuturecashreceiptsthroughtheexpectedlifeofthefinancialassettothatasset’snetcarryingamount.





foreign currency translation

(i)Functionalandpresentationcurrency

Items included in the financial statementsof theAuthorityaremeasuredusing the currencyof theprimaryeconomicenvironment inwhich theAuthorityoperates(“functionalcurrency”).ThefinancialstatementsarepresentedinTanzanianShillings,whichistheAuthority’sfunctionalandpresentationcurrency.

(ii)Transactionsandbalances:

Foreign currency transactions are translated into Tanzanian shillings using the exchange ratesprevailingatthedatesoftransactions.Attheendofeachreportingperiod,monetaryitemsdenominatedinforeigncurrenciesaretranslatedtoTanzanianShillingsattherateprevailingatthatdate.Exchangedifferencesarerecognizedinprofitorlossintheperiodinwhichtheyarise.

borrowing costs

Borrowingcostsdirectlyattributabletotheacquisition,constructionorproductionofqualifyingassets.whichareassetsthatnecessarilytakeasubstantialperiodoftimetogetreadyfortheirintendeduseorsale,areaddedtothecostofthoseassets,untilsuchtimeastheassetsaresubstantiallyreadyfortheirintendeduseorsale.

Investment income earned on the temporary investment of specific borrowings pending theirexpenditureonqualifyingassetsisdeductedfromtheborrowingcostseligibleforcapitatisation.

Allotherborrowingcostsarerecognisedinprofitorlossintheperiodinwhichtheyareincurred.

Property and equipment

Propertyandequipmentarestatedatcost,lessaccumulateddepreciationandaccumulatedimpairmentlosses.

Depreciationiscalculatedtowriteoffthecostoffixedassetsonastraight-linebasisovertheusefullifeoftheassets.Theannualdepreciationrates,whichhavebeenconsistentlyapplied,areasfollows:

Buildings 4% MotorVehicles 20% TelecommunicationsEquipment 7% FurnitureandFittings 10% Computershardware 20%

Intangible assets: Computer software

Intangible assets acquired are carried at cost less accumulated amortization and accumulatedimpairment losses. Internally generated intangible assets, excluding capitalised development costsarenotcapitalisedandexpenditureischargedtoprofitorlossintheyearinwhichtheexpenditureisincurred.

Intangibleassetsareamortisedovertheusefuleconomiclifeandassessedforimpairmentwheneverthereisanindicationthattheintangibleassetmaybeimpaired.


TANZANIACIVIL AVIATION AUTHORlTY



amortization of Intangible assets

Amortizationiscalculatedonastraight-linebasistowriteoffthecostofintangibleassetsovertheirestimatedusefullives,Theannualratesofamortizationwhichhavebeenconsistentlyappliedare:

MISProject 25%

Impairment of assets

At theendofeachreportingperiod, theAuthority reviewsthecarryingamountsof itsassets todeterminewhetherthereisanyindicationofimpairment.Ifanysuchindicationexists.theasset’srecoverableamountisestimatedandanimpairmentlossisrecognizedintheprofitorlosswheneverthecarryingamountoftheassetexceedsitsrecoverableamount.

Inventories

Inventoriesarestatedat the lowerofcostandnet realizablevalue.Cost isdeterminedusing theFirst-in-Firstout(FIFO)method.Netrealizablevalueistheamountthattheitemcanrealizeinthemarketlesscostof bringing to the saleable condition.Specific provision ismade for obsolete, slowmovinganddamagedInventory.

financial instruments

Financial assets are classified into the following specified categories: ‘available-for-sale” (“AFS”) financialassets,heldtomaturity(“HTM”)and“loansandreceivables”.Theclassificationdependsonthenatureandpurposeofthefinancia!assetsandisdeterminedatthetimeofinitialrecognition.Atthereportingdates,theAuthorityhadloansandreceivablesonly.

(a)Effectiveinterestmethod

Theeffectiveinterestmethodisamethodofcalcufatingtheamortisedcostofafinancialassetandofallocatinginterestincomeovertherelevantperiod.Theeffectiveinterestrateistheratethatexactlydiscountsestimatedfuturecashreceipts(includingall feesonpaintspaidorreceivedthatformanintegralpartoftheeffectiveinterestrate, transactioncostsandotherpremiumsordiscounts) throughtheexpected lifeof thefinancialasset,or,whereapproprtare.iashorterperiod,Incomeisrecognisedonaneffectiveinterestbasisfordebtinstruments.

(b)Loansandreceivables

Tradereceivables,loans,andotherreceivablesthathavefixedordeterminablepaymentsthatarenotquotedinanactivemarketareclassifiedasloansandreceivables.Loansandreceivablesaremeasuredatamortisedcostusingtheeffectiveinterestmethod,lessanyimpairment.Interestincomeisrecognisedbyapplyingtheeffectiveinterestrateexceptforshort-termreceivableswhentherecognitionofinterestwouldbeimmaterial.

(c)Impairmentoffinancialassets

Financial assets areassessed for indicators of impairment at theendof each reportingperiod.Financialassetsareimpairedwherethereisobjectiveevidencethat,asaresultofoneormoreeventsthatoccurredaftertheinitialrecognitionofthefinancialasset,theestimatedfuturecashflowsoftheinvestmenthavebeenimpacted.

Objective evidence of impairmentcouldinclude: l significantfinancialdifficultyoftheissuerorcounterparty;or l defaultordelinquencyininterestorprincipalpayments;or l itbecomingprobablethattheborrowerwillenterbankruptcyorfinancialre-organization.

Forfinancialassetscarriedatamortizedcost, theamountof the impairment isthedifferencebetweentheasset’scarryingamountand thepresentvalueofestimated futurecashflows,discountedat thefinancialasset’s original effective interest rate.





financial instruments (continued)

Thecarryingamountofthefinancialassetisreducedbytheimpairmentlossdirectlyforallfinancialassetswiththeexceptionoftradereceivables,wherethecarryingamountisreducedthroughtheuseofanallowanceaccount.

Whenatradereceivableisconsidereduncollectable, it iswrittenoffagainsttheallowanceaccount.Subsequentrecoveriesofamountspreviouslywrittenoffarecreditedagainsttheallowanceaccount.Changesinthecarryingamountoftheallowanceaccountarerecognizedinprofitorloss.

If, in a subsequent period, the amount of the impairment loss decreases and the decrease canbe related objectively to an event occurring after the impairment was recognized, the previouslyrecognizedimpairmentlossisreversedthroughprofitorlosstotheextentthatthecarryingamountoftheinvestmentatthedatetheimpairmentisreverseddoesnotexceedwhattheamortizedcostwouldhavebeenhadtheimpairmentnotbeenrecognized.

(d)Derecognitionoffinancialassets

TheAuthorityderecognizesafinancialassetonlywhenthecontractualrightstothecashflowsfromtheassetexpire;orittransfersthefinancialassetandsubstantiallyalltherisksandrewardsofownershipoftheassettoanotherentity.IftheAuthorityneithertransfersnorretainssubstantiallyalltherisksandrewardsofownershipandcontinuestocontrolthetransferredasset,itrecognizesitsretainedinterestintheassetandanassociatedliabilityforamountsitmayhavetopay.IftheAuthorityretainssubstantiallyall the risks and rewards of ownership of a transferred financial asset, theAuthority continues torecognizethefinancialassetandalsorecognizesacollateralizedborrowingfortheproceedsreceived.

available for sale Investments

Available-forsale Investmentsare those intended tobeheld foran Indefiniteperiodof time,whichmaybesoldinresponsetoneedsforliquidityorchangesininterestrates,exchanqerates,orequityprices.TheAuthority classifies equity investments, other than those acquired for trading purposesasavailable-for-sale.An investment inquotedsharesofTwigaCementCompanyLimitedhasbeenclassifiedasavailableforsalefinancialassets.

Cash and Cash equivalents

Cashandcashequivalentsinthestatementoffinancialpositioncomprisecashatbankandinhandandshorttermdepositswithmaturityofthreemonthsorless.ForpurposeofcashfIowstatement,cashandcashequivalentsconsistsofcashandcashequivalentasdefinedabove,netofoutstandingbankoverdrafts.

Provisions

ProvisionsarerecognisedwhentheAuthorityhasapresentobligation(legalorconstructive)asaresultofapasteventinwhichitisprobablethatanoutflowofresourcesembodyingeconomicbenefitswillberequiredtosettletheobligationandareliableestimatecanbemadeoftheamountoftheobligation.Iftheeffectofthetimevalueofmoneyismaterial,provisionsarediscountedusingacurrentpre-taxratethatreflects,whereappropriate,therisksspecifictotheliability.Wherediscountingisused,theincreaseinprovisionduetopassageoftimeisrecognisedasaborrowingcost.





Pensions and other post-employment benefits

TheAuthoritycontributestoadefinedcontributionsplanandadefinedbenefitplan.

(i) Pension obligations

Underthedefinedcontributionplan,theAuthority’semployeesaremembersofstateownedpensionschemes,thePublicServicePensionFund(PSPF)andNationalSocialSecurityFund(NSSF).TheAuthoritycontributestotheschemes15%and10%ofgrosssalaryforeachemployee,andemployeecontributes5%and10%respectively.TheAuthority’scontributionstothefundarechargedtotheprofitorlossinmeperiodinwhichtheyrelate.

(ii) Shorttermbenefits

Thecostofallshorttermemployeebenefitssuchassalaries,employee’sentitlementstoleavepay,medicalaids,longserviceaward,andothercontributionsetcarerecognisedduringtheperiodinwhichtheemployeerendersrelatedservices.

(iii) Terminalbenefits

TerminationbenefitsarepayablewhenemploymentisterminatedbytheAuthoritybeforethenormalretirement date or whenever an employee accepts voluntary redundancy in exchange for thesebenefits.TheAuthority recognises terminationbenefitswhen it isdemonstrablycommitted toeitherterminatingtheemploymentofcurrentemployeesaccordingtoadetailedformalplanwithoutpossibilityofwithdrawal,orprovidingterminationbenefitsasaresultofanoffermadetoencouragevoluntaryredundancy. Benefits falling due more than twelve months after reporting date are discounted topresentvalue.

(iv)Gratuitybenefits

TheAuthorityprovidesgratuitybenefitstoitscontractemployee’spayableonexpiryofthecontract.TheAuthoritycontributes25%ofthebasicsalarytowardsthatfund.Gratuityischangedtoprofitorlossduringtheperiodinwhichtheemployeerendersrelatedservices.

Value added Tax (VaT)

TheAuthoritybeinggovernmentdepartmentisnotregisteredforValueAddedTax(VAT).NoVATischargedforall invoicesraisedbytheAuthority.VAT incurredonapurchaseofassetsandservicesisnot recoverableandare therefore recognisedaspartof thecostofassetpurchasedorexpenseincurred.

Trade and other payables

Tradeandotherpayablesarestatedattheirnorninalvalue.Tradepayablesarenon-interestbearingandarenormallysettledbetween15to30dayswhenthecompanycollectspremiumsfromcustomers.




2. CRITICal aCCoUnTInG JUDGeMenTs anD KeY soURCes of esTIMaTIon UnCeRTaInITIes

ThepreparationoffinancialstatementsinconformitywithInternationalFinancialReportingStandardsrequirestheuseofcertaincriticalaccountingestimates.Italsorequiresmanagementtoexerciseitsjudgementintheprocessofapplyingtheauthority’saccountingpolicies.Theareasinvolvingahigherdegreeofjudgementorcomplexity,orareaswhereassumptionsandestimatesaresignificanttothefinancialstatementsaredisclosedbelow.

(i) Impairment provision

Management carries out a regular review of the status of trade receivables, inventories and otherfinancial assets to determine whether there is any indication that these assets have suffered anyimpairmentloss.Ifanysuchindicationexists,therecoverableamountoftheassetisestimatedinordertodetermine theextentof impairment loss,which is thendealtwith inprofitor loss. Indeterminingwhetheranimpairmentlossshouldberecognizedintheprofitorloss,managementcheckswhetherthere is objective evidence that the assets are impaired and that the fair values have declined.Managementestimatesof the requiredprovisionsarebasedoncriticalevaluationof theeconomiccircumstancesinvolved,historicalexperienceandotherfactorsthatareconsideredtoberelevant.

(ii) Property and equipment, and intangible assets

Managementreviewstheusefullivesandresidualvaluesoftheitemsofproperty,andequipmentandintangibleassetsonaregularbasis.Duringthefinancialyear,thedirectorsdeterminednosignificantchangesintheusefullivesandresidualvalues.

3. fInanCIal RIsK. ManaGeMenT

Theauthority’sactivitiesexposeittoavarietyoffinancialrlsks,includingcreditrisk,foreigncurrencyexchangeratesand interest rates.TheAuthority’soverall riskmanagementprogrammefocusesontheunpredtctabllltyoffinancialmarketsandseekstominimisepotentialadverseeffectsonitsfinancialperformancewithintheoptionsavailableinTanzania.RiskmanagementiscarriedoutbytheaccountingunitundertheresponsibilityoftheBoardofDirectors.

Themostimportanttypesofriskare:

l Creditrisk: l Liquidityrisk; l Marketrisk(interestrateriskandexchangeraterisk).

Credit risk management

Credit risk ismanagedonanentity-widebasis.Credit riskarises fromcashandcashequivalents,depositswithbanks,aswellastradeandotherreceivables.TheAuthorityassessesthecreditqualityofeachcustomer,takingintoaccountitsfinancialposition,pastexperienceandotherfactors.

TheAuthority doesnot haveany significant credit risk exposure to any single counterparty or anygroupofcounterpartleshavingsimilarcharacteristics.TheAuthoritydefinescounterpartiesashavingsimilarCharacteristicsiftheyarerelatedentities.Thecreditriskonliquidfundsandderivativefinancialinstrumentsislimitedbecausethecounterpartiesarebanks.


TANZANIACIVilAVIATIONAUTHORITY


3. fInanCIal RIsK ManaGeMenT (ConTInUeD)

Credit risk management (Continued)

TheamountthatbestrepresentstheAuthority’smaximumexposuretocreditriskat30Junewithouttakingaccountofthevalueofanycollateralobtainedwas:

2011 2010 TZs ‘000 TZs ‘000

Tradeandotherreceivables 3,624,476 2,932,193Term deposits 4,394,608 7,287,926Cashatbankandinhand 3,488,434 4,071,599

11,507,518 14,291,718

Thecustomersunderthefullyperformingcategoryarepayingtheirdebtsastheycontinuetrading.Thedefaultrateislow.

Thedebtthatisoverdueisnotimpairedandcontinuestobepaid.Thefinancedepartmentisactivelyfollowingthisdebt.

Thedebtthatisimpairedhasbeenfullyprovidedfor.However,managementisactivelyfollowinguprecoveryoftheimpaireddebtThemovementintheprovisionforbadanddoubtfuldebtsisassetoutbelow:

2011 2010 TZs ‘000 TZs ‘000

Atthebeginningoftheyear 1,053,010 964,538Provisionfortheyear 144,828 88,472

Attheendoftheyear 1,197,838 1,053,010

Indeterminingtherecoverabilityofatradereceivable,theauthorityconsidersanychangeinthecreditqualityofthetradereceivablefromthedatecreditwasinitiallygranteduptothereportingdate.Thedirectorsbelievethatthereisnofurtherprovisionrequiredinexcessoftheallowancefordoubtfuldebtsalreadyrecognised.

Fair value of financial assets and liabilities

TheAuthorityonlyhastheavailableforsaleinvestmentearnedatfairvalue.Thesearegroupedintolevel1asperclassificationbelow:

i) Level 1 fair valuemeasurements are those derived fromquoted prices (unadjusted) in activemarketsforidenticalassetsorliabilities;

ii) Level2fairvaluemeasurementsarethosederivedfrominputsotherthanquotedpricesincludedwithinlevel1thatareobservablefortheassetorliability,eitherdirectly(i.e.asaprice)orindirectly(i.e,derivedfromprices);and

iii) Level3fairvaluemeasurementsarethosederivedfromvaluationtechniquesthatincludeinputsfortheassetorliabilitythatarenotbasedonobservablemarketdata(unobservableinputs).

liquidity risk management

This is monitored on a daily basis by the finance manager by monitoring of cash forecasts inconsiderationofmaturingliabilitiesandassets.


TANZANIACIVILAVIATIONAUTHORlTY



liquidity risk management (Continued)

Maturityanalysisforfinancialliabilitiesshowingtheremainingcontractualmaturities:

1 - 5 5 - 12At30June2011 <1 month months months > 1 year Total TZs’000 TZs’000 TZs’000 TZs’000 TZs’000

Tradeandotherpayables 934,295 1,556,298 - - 2,490,593Borrowings - 1,037,393 - 7,528,491 8,565,884

Total 934,295 2,593,691 - 7,528,491 11,056,477

At30June2010

Tradeandotherpayables 2,009,740 795,695 - - 2,805,435Borrowings - 2,128,847 - 7,967,735 10,096,582

Total 2,009,740 2,924,542 - 7,967,735 12,902,017

Maturityanalysisforfinancialassetsshowingtheremainingcontractualmaturities:

1 - 5 5 - 12 >1At30June2011 <1 month months months > 1 year Total TZs’000 TZs’000 TZs’000 TZs’000 TZs’000

Availableforsaleinvestments - - - 14,261 14,261Tradereceivables 980,103 2,454,073 - - 3,434,176Termdeposits - 2,760,540 1,259,787 374,281 4,394,608Cashandbankbalances 3,488,434 - - - 3,488,434

Total 4,468,537 5,214,613 1,259,787 388,542 11,331,479

At30June2010

Availableforsaleinvestments - - - 13,073 13,073Tradereceivables 599,678 2,332,515 - - 2,932,193Termdeposits - 5,432,727 1,500,694 354,505 7,287,926Cashandbankbalances 4,071,599 - - - 4,071,599

Total 4,671,277 7,765,242 1,500,694 367,578 14,304,791

Market risk management

Theauthority’sactivitiesexposeIttothefinancialriskofchangesinforeigncurrencyexchangeratesand interest rates.

foreign currency risk management

TheAuthority’s costs and expenses are principally incurred in Tanzanian Shillings (TZS) and USDollars(US$).TheAuthoritydoesnotenterintoformalhedgingtransactionstomanageitsexposuretoforeignexchangeratefluctuations.VolatilityintheexchangerateofUS$againstTZSwouldmaketheAuthority’scostsandresultslesspredictablethanwhenexchangeratesaremorestable.





Market risk management (Continued)

ThecarryinqamountsoftheAuthority’srnaterialforeigncurrencydenominatedmonetaryassetsandliabilitiesthatwillhaveanimpactonprofitorlosswhenexchangerateschangeasat30June2011areasfollows:

UsD eUR Total TZs’000 TZs’000 TZs’000

Tradereceivables 3,020,776 - 3,020,776

Cashandcashequivalents 4.440.499 374,281 4,814,780

Tradepayables (1,193,583) - (1,193,583)

Openposition 6,267,692 374,281 6,641,973

ThecarryingamountsofttleAuthority’smaterialforeigncurrencydenominatedmonetaryassetsandliabilitiesthathaveanimpactonprofitorlosswhenexchangerateschange,asat30June2010wereasfollows:

UsD eUR Total TZs’000 TZs’000 TZs’000

Tradereceivables 2,145,720 - 2,145,720

Cashandcashequivalents 8,404,823 354,505 8,759,328

Tradepayables (1,359,735) - (1,359,735)

Openposition 9,190,808 354,505 8,545,313

Foreigncurrencysensitivityanalysis

At30June2011,iftheTZShadweakened/strengthenedby5%againsttheUS$andEurowithallothervariablesheldconstant,theimpactonsurplusfortheyearwouldhavebeenTZS332,099,650(2010:TZS477,265,850)higher/lower.

Interest rate risk management

Theauthorityisexposedtointerestrateriskasitborrowsfundsatbothfixedandfloatinginterestrates.Theriskismanagedbyaclosemanagementmonitoringcontrol,TheAuthority’sexposurestointerestratesonfinancialassetsandfinancialliabililiesaredetailedintheliquidityriskmanagementsection.





Market risk management (Continued)

Interestratesensitivityanalysis:

At30June2011,Iftheinterestratehadincreased/loweredby5%withallothervariablesheldconstant,the impactonsurplusfor theyearwouldhavebeenTZS428,294,216(2010:TZS504,831,613)higher/lower.

financial Instrument categorization

30 June 2011 financial liabilities carried at Non financial loans and amortized liabilities or receivables costs assets equity Total TZs’000 TZs’000 TZs’000 TZs’000 TZs’000

asseTs non Current assets Property,plantandequipment - - 25,484,619 - 25,484,619Intangibleasset - - 133,482 - 133,482

Current assets Availableforsaleinvestment 14,262 14,262Inventories - - 1,238,705 - 1,238,705Tradeandotherreceivables 3,434,176 - 607,317 - 4,041,493Termdeposits 4,394,608 - - - 4,394,608Bankandcashbalances 3,488,434 - - - 3,488,434 11,331,480 - 27,464,123 - 38,795,603

eQUITY anD lIabIlITIesCapital and Reserves Capitalfund - - - 6,694,229 6,694,229Investmentrevaluationreserves - - - 11,030 11,030Accumulatedsurplus - - - 20,703,753 20,703,753

non current liabilitiesBorrowings - 7,528,491 - - 7,528,491

Current liabilities Fundsheldforspecialprojects - - 330,114 - 330,114Tradeandotherpayables - 2,490,593 - - 2,490,593Borrowings - 1,037,393 - - 1,037,393

- 11,056,477 330,114 27,409,012 38,795,603





financial instrument categorization (continued)

30 June 2011 financial liabilities carried at Non financial loans and amortized liabilities or receivables costs assets equity Total TZs’000 TZs’000 TZs’000 TZs’000 TZs’000

asseTs non Current assets Property,plantandequipment - - 23,468,754 - 23,468,754Intangibleasset - - 422,630 - 422,630

Current assets Availableforsaleinvestment 13,073 - - - 13,073Inventories - - 403,468 - 403,468Tradeandotherreceivables 2,932,193 - 432,548 - 3,364,741Termdeposits 7,287,926 - - - 7,287,926Bankandcashbalances 4,071,599 - - - 4,071,599 14,304,791 - 27,727,400 - 39,032,191

eQUITY anD lIabIlITIesCapital and Reserves Capitalfund - - - 6,694,229 6,694,229Investmentrevaluationreserves - - - 9,842 9,842Accumulatedsurplus - - - 19,095,989 19,095,989

non current liabilitiesBorrowings - 7,967,735 - - 7,967,735

Current liabilities Fundsheldforspecialprojects - - 330,114 - 330,114Tradeandotherpayables - 2,805,435 - - 2,805,435Borrowings - 2,128,847 - - 2,128,847

- 12,902,017 330,114 25,800,060 39,032,191




2011 2010 TZs ‘000 TZs ‘000

4. ReVenUe

AirNavigationServices 12,279,032 10,005,178 SafetyFee 7,710,351 6,495,994 LandingandParklngServices 2,400,453 1,821,678 AirServiceLicensing 1,232,147 1,005,764 AirworthinessCertification 380,269 298,154 FlightOperationFees 143,997 198,665 Students’Fees 173,912 147,796 PersonnelLicensing 146,611 131,727 AdministrationFees 115,388 75,423 AirportServiceCertification 48,662 48,505 FlightSafetyDocuments 2,495 4,551 AlPLogBookSales 13,757 4,344

TOTAL 24.647,074 20,237,779 Less:SharerevenueduetoTanzaniaMeteorologicalAgency (TMA)17.5%Airnavigationfees (2,149,990) -’1,750.906.

NetRevenuefromoperatingactivities 22,497,084 18,486,873

*Revenue sharing Ratio Landing and Parking services amount is net amount receivable from TanzaniaAirportAuthority

(TAA).AirNavigationandLandingchargessharingratiois82.5%,0%,17.5%and30%,60%,10%forTCAA,TAA,andTMA respectively.TCAAcollectsanddistributes theAirNavigationServicesrevenueinthegivenratios.




2011 2010 TZs ‘000 TZs ‘000 5. oPeRaTInG anD aDMInIsTRaTIVe CosTs Depreciationandamortization 2,252,667 1,618,812 Seminarsandconferences-Localandabroad 1,048,631 821,767 Otheradministrativecosts(Note6) 989.412 805,878 Repairandmaintenancecosts 843,048 1,866,473 Cleaning,officesundries,waterandelectricity 806,425 810,894 Trainingcosts-Localandabroad 795,740 1,077,173 Inspection,safetyoversightandaccidentinvestigation 736,579 573,978 SADCandCASSOAcosts 710,620 832,486 Motorvehiclefuels,insuranceandparkingfees 558,110 452,711 Telephoneandleasedcircuitcharges 501,222 647,134 Printing,stationery,advertisementandpublicity 452,959 396,734 Regionalandtendermeetings 356,105 197,001 Officerent 238,940 187,266 Transfer&ReliefDuties 215,163 112,335 Computersupplies 198,992 184.866 Consumerconsultativecouncilcosts 172,526 165,767 Securitycharges 153,322 163,496 lATACommissions 144,092 127,504 Allowancesfordoubtfuldebts 144,828 90,957 Postage,faxandemail 117,242 155,080 ISO9000certification 111,278 116,617 Bankcharges 94,486 88,761 ICAD&familyday 83,059 121,102 Publicityandpromotionalcosts 59,006 114,794 Consultancyfees 24,515 68,547 Airportcharges - - Foreignexchangegain (18,748) (1,067,966) 11,790,219 10,730,167

6. oTHeR aDMInIsTRaTIVe CosTs

WorkersCouncil 137,555 72,057 BoardofDirectors 121,855 84,740 Strategic,Business&BudgetPreparation 108,460 87,616 AuditFees 93,535 83,896 TugheExpenses 84,379 83,360 CATCOtherRunningExpenses 70,705 46,872 CATCTeachingAllowance 57,240 61,164 MedicalExpenses 53,477 24,043 PublicationsNewspapers&Periodicals 52,956 39,757 Computersoftwaremaintenance 49,368 20,780 ICAO&OtherMembershipContribution 38,141 94,092 MCTExpenses 32,307 27,664 GovernmentHospitality 23,977 15,715 CATCStudentAllowances 21,445 12,453 Auditteamexpenses 19,077 18,100 Donation&SocialResponsibility 13,361 15,524 BenchMarking&CashinTransit 11,574 13,436 Search&Rescue - 4,609 989,412 805,878




2011 2010 TZs ‘000 TZs ‘000

7. sTaff CosTs Salaries 6,061,914 4,394,392 Otherstaffcosts(note10) 860,570 729,947 Gratuityexpense 523,380 391,356 PublicServicePensionFundcontributions 500,694 365,607 Leavepassage 388,732 359,073 Overtime 309,044 290,612 NationalSocialSecurityFundcontributions 228,549 149,020 Healthinsurancecontribution 173,941 138,634 Staffretirement 82,903 28,103 Total 9,129,727 6,846,744

8. InTeResT eXPense Interestonborrowings 221,132 -

TheAuthoritycapitalizedinterestfromborrowingsamountingtoTZS204.402million(2010:TZS433million)inaccordancetoIAS23-Borrowingcosts(Revised).Thestandardpermitsentitiestocapitalizeborrowingcostsonqualifyingassetsuntilthoseassetsarecommissioned.InterestexpenseincurredaftercommissioningofAviationHousehasbeenchargedtoprofitofloss.

2011 2010 TZs ‘000 TZs ‘000

9. sURPlUs foR THe YeaR Surplusofincomeoverexpenditureisstatedundercharging: Depreciationandamortization 2,254,976 1,618,813 Auditcommitteeexpenses 25,370 18,100 Boardofdirectors’meetingsexpenses 121,855 84,740 ConsumerConsultativeCouncilsupport 160,229 165,767

10. oTHeR sTaff CosTs Mealallowance 203,386 116,928 Shiftallowance 118,023 100,841 Inspectorsallowance 113,000 216,000 Staffuniform 74,108 660 Staffrecruitment 70,893 91,343 Furnitureallowance 64,500 10,500 Actingallowance 48,635 27,895 Transportallowance 46,803 44,842 CasualLabour&wages 38,335 33,233 Houseallowance 38,095 54,569 Deathandcondolences 25,644 16,03 Outfitallowance 9,900 15,600 Cashintransitallowance 9,249 - Marriageallowance - 1,500

Total 860,571 729,947


TANZA

NIACIVILAVIATIONAUTH

ORlT

Y

NOTE

STOTHEFINANCIALSTATE

ME

NTS

(CO

NTI

NU

ED

)

11.

PRo

PeR

TY a

nD

eQ

UIP

Men

T

furn

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O

ffice

M

otor

Te

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m&

an

d

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k in

bu

ildin

g ve

hicl

es

Nav

aid

fittin

gs

Com

pute

r Eq

uipm

ent

prog

ress

To

tal

TZs

‘000

TZ

s ‘0

00

TZs

‘000

TZ

s ‘0

00

TZs

‘000

TZ

s ‘0

00

TZs

‘000

TZ

s ‘0

00

Cos

t

At1July2009

1,489,271

1,270,036

9,614,105

892,362

1,406,729

1,049,961

6,020,454

21,742,918

Additions

129,025

147,260

3,581,588

69,755

159,422

105,659

5,959,171

10,151,880

At30June2010

1,618,296

1,417,296

13,195,693

962,117

1,566,151

1,155,620

11,979,625

31,894,798

At1July2010

1,618,296

1,417,296

13,195,693

962,117

1,566,151

1,155,620

11,979,625

31,894,798

Additions

2,092,597

175,995

1,349,579

72,266

215,583

73,365

-3,979,385

Transfers

9,656,437

-437,584

277,220

-1,608,384

(11,979,625)

-

At30June2011

13,367,330

1,593,291

14,982,856

1,311,603

1,781,734

2,837,369

-35,874,183

D

epre

ciat

ion:

At1July2009

438,238

808,324

3,809,116

387,321

962,130

604,559

-7,009,688

Chargefortheyear

63,132

184,759

733,166

92,007

192,343

150,949

-1,416,356

At30June2010

501,370

993,083

4,542,282

479,328

1,154,473

755,508

-8,426,044

At1July2010

501,370

993,083

4,542,282

479,328

1,154,473

755,508

8,426,044

Chargefortheyear

217,362

298,125

1,001,991

108,078

163,416

174,547

-1,963,519

At30June2.011

718,732

1,291,208

5,544,273

587,406

1,317,889

930,055

-10,389,563

NBV30June2010

1,116,926

424,213

8,653,411

482,789

411,678

400,112

11,979,625

23,468,754

NBV30June201112,648,598

302,083

9,438,583

724,197

463,845

1,907,314

-25,484,620




2011 2010 TZs ‘000 TZs ‘000 12. InTanGIble asseTs

software Costs

CosT

At1July 1,143,879 979,713

Additions - 164,166

At30June 1,143,879 1,143,879

aMoRTIZaTIon

At1July (721,249) (518,792)

Chargefortheyear (289,147) (202,457)

At30June (1,010,396) (721,249)

neT booK ValUe

At30June 133,483 422,630

13. aVaIlable foR sale InVesTMenT

At1July 13,073 11,587 Effectsofchangesinfairvalue 1,188 1,486

14,261 13,073

Availableforsaleinvestmentsrepresent7,428equitysharesofTwigaPortlandCementCompanyLtdpurchasedduringtheInitialPublicOfferingatacostofTZS435pershare.

Duringtheyear, theAuthorityearneddividends incomefromthesharesamountingtoTZS945,258(2010;TZS965,640).

2011 2010 TZs ‘000 TZs ‘000 14. InVenToRY

Maintenanceandtechnicalsupplies 1,032,598 213,078 Stationery 206,108 140,514 Consumablesupplies - 49,876

1,238,706 403,468




2011 2010 TZs ‘000 TZs ‘000 15. TRaDe anD oTHeR ReCeIVables Tradereceivables 3,361,320 2,817,919 Staffreceivables 99,810 104,466 Duefromrelatedparties(Note24) 1,141,096 1,016,052 Otherreceivables 204,505 46,766 4,806,731 3,985,203 Allowancefordoubtfuldebts (1,197,838) (1,053,010)

3,608,893 2,932,193

16. TeRM DePosITs Bankdepositsmaturingwithin3months(Note17) 2,760,540 5,432,727 Restrictedfund* 374,281 354,505 Bankdepositsmaturingafter3months 1,259,787 1,500,694

4,394,608 7,287,926

*RestrictedfundsrelatedtofundsreceivedfromICAO(Note20),whicharenotsubjecttouseuntiltheproject starts.

Termbankdepositsrepresenttheamountsinvestedinfixeddepositswithcommercialbanksforfixedtermswithanaverageinterestrateof3.7%.(2010;4%).

17. CasH anD CasH eQUIValenTs

Forthepurposeofthecashflowstatement,cashandcashequivalentscomprisethefollowing:

2011 2010 TZs ‘000 TZs ‘000

TermDeposits-maturingwithin3months(Note16) 2,760,540 5,432,727 Cashandbankbalances 3,488,434 4,071,599

6,248,974 9,504,326




18. CaPITal fUnD

BytheprovisionscontainedintheCivilAviationAct(Act10,)2003,allmovableandimmovablepropertieswhich immediatelybeforethecommencementof theActwerevested in theformerTC,establishedunderExecutiveAgenciesAct.No.3of1997,vestedintheTanzaniaCivilAviationAuthoritysubjecttoallinterests,liabilities,charges,obligationsandtrustsaffectIngthosepropertsConsequently.thecapitalfund representspartof thenetassetsand liabilities then identifiedand takenoverby theAuthorityafter transferring residential buildings toTanzaniaBuildingAgency in July 2003 and adjustment ofoverstated trade receivables.

19. aCCUMUlaTeD sURPlUs

TheCivilAviationActNo10of2003,whichhasbeenconsolidatedwiththeCivilAviationActof1977andnowcitedastheCivilAviationActCap80of2006.TheActrequirestheAuthoritytodepositsurplusincometoaspecialaccountandusethosefundsforspecificindustrydeveloprnetpurposesandthatsection48(1)requirestheAuthoritytoestablishandcontributetowardsatrainingfund.Asat30June2011;theAccumulatedSurplushadatotalbalanceofTZS20,271,155,000(2010:TZS18,663,391,000}.Thisaccumutatedsurplusisrepresentedbyfixeddeposits,TrainingPilotsandAircraftMaintenanceEngineersandcapitalinvestmentsoftheAuthority.

20. boRRoWInGs

Theborrowingsareanalysedasfollows:

2011 2010 TZs ‘000 TZs ‘000

non Current Portion LongtermloanfromTreasury 925,044 1,958,193 LongtermloanfromCommercialBankofAfrica 6,603,447 6,009,542

7,528,491 7,967,735

Current Portion LongtermloanfromCommercialBankofAfrica 427,393 1,518,847 LongtermloanfromTreasury 610,000 610,000

1,037,393 2,128,847

Total borrowings 8,565,884 10,096,582

Detailsoftheborrowingsareasfollows:

(i) long term loan from Treasury

TheGovernmentofUnitedRepublicofTanzaniaobtaineda loanofEuro4,650,000fromEuropeanInvestmentBank towards improvement of theAirTrafficEquipment at the J.Nyerere InternationalAirport.SubsequentlytheGovernmententeredintoalendingagreementwiththethenTanzaniaCivilAviationAuthority.Theamount lentwasfreeof interest.Oneofthetermsandconditionsof lendingagreementwastheconversionofthefacilityinTanzanianShillingsusingBankofTanzaniaexchangerateapplicableinthedateofreceivingtheloan.TheconvertedloanamountedtoTZS4,391,580,903.

TheAuthorityhasbeenrepayingtheloaneveryyearwiththeloanexpectedtobefullyrepaidbyJuly2013.Asof30June2011TZS1,037,393,000,becamecurrentandnasbeendisclosedaspart ofcurrentliabilityinthestatementoffinancialposition.

(ii) long term from Commercial bank of africa

TheAuthorityhasaborrowingfacilityfromCommercialBankofAfricaforTZS6.25billionrepayableinfiveyears towards theconstructionofTCAAHeadquartersat the interestof7%perannum.Thedrawdownasat30June2011wasUS$5,400,000,whichisequivalenttoTZS7,523,874,000.




20. boRRoWInGs (Continued)

(iii) short term loan from Commercial bank of africa

TheAuthorityinJuly2010,borrowedShortTermLoanfromCommercialBankofAfrica

USD1,000,000whichwasequivalenttoTZ.S1,509,000,000topaymaturingAviationHouseobligationsfromMainContractorandSubcontractors.TheShortTermFacilitywasrepaidbyNovember2010asagreed.

21. eMPloYee benefITs

(i) Retirement Benefits

TheAuthoritycontributestoapensionschemadministeredbythePublicServicePensionFund(PSPF)and a scheme administered by the National Social Security Fund (NSSF) depending on terms ofemployment.

Inaddition,theAuthorityhasanendowmentschemeadministeredbyavoluntaryagreementbetweenmanagementandTUGHEasprovidedforinthestaffbenefitpackagetoprovideretirementbenefitstoemployeesreachingretirementage.Theretiredemployeeispaidinmaterialormonetaryequivalenttothematerialbasedonthelengthofservice

Thecostof theendowmentschemeand the retirementagebenefitsare fullymetby theAuthority.Contributionstothesefundsarerecognisedasanexpenseintheperiodtheemployeesrendertherelated services.

(ii) Termination Benefits

Termination benefits are payable whenever an employee’s employment is terminated before thenormalretirementdateorwheneveranemployeeacceptsvoluntaryredundancyinexchangeofthesebenefits. .

TheAuthority recognises termination benefits when it is constructively obliged to either terminatethe employment or the current employees according to detailed formal plan without possibility ofwithdrawalortoprovideterminationbenefitsasaresultofanoffertoencouragevoluntaryredundancy.TheexpenserecognisedbytheAuthorityduringtheyearwasasfollows:

2011 2010 TZs ‘000 TZs ‘000

EndowmentScheme(Staffretirementbenefits) 82,903 28,103 PublicServicePensionFund 500,694 365,607 NationalSocialSecurityFund 228,549 149,020 Gratuityforcontractstaff 523,380 391,356

Total 1,335,526 934,086




21. eMPloYee benefITs (Continued)

(iii) Provision for Gratuity. contract staff

Under the contract of employment theAuthority contributes to Public Service Pension Fund andNationalSocialSecurityFundforfutureretirementbenefitforitsemployees.However,theAuthoritychargesgratUityexpenseinprofitorlossandmaintainsgratuitypayableaccountforfuturepaymenttocontractstaff.Gratuityrelatestolongserviceawardtoemployeesandiscomputedat25%oftheemployees’basicsalary.Themovementintheprovisionforgratuitywasasfollows:

2011 2010 TZs ‘000 TZs ‘000 At1July 795,695 624,567 Chargefortheyear 523,380 391,356 Releasedduringtheyear (405,860) (220,228) Balanceat30June 913,215 795,695

22. fUnDs HelD foR sPeCIal PRoJeCT

TheAuthority receivedEuro188,852,whichwasequivalent toTZS330.113,978on30September2006fromInternationalCivilAviationOrganization(ICAO)inrespectofintegrationandharmonisationoftheEastAfricanSafetyOversightProject.Asattheendofthereportingperiod,theprojecthasnotcommencedandthefundsareheldinaseparatefixeddepositaccountuntilthetimeofimplementationoftheproject.

23. TRaDe anD oTHeR PaYables

2011 2010 TZs ‘000 TZs ‘000 Tradepayables 1,554,026 1,958,811 Otherpayables 23,351 50,929

1,577,377 2,009,740

24. RelaTeD PaRTY TRansaCTIons anD balanCes

TanzaniaCivilAviationAuthority isabodycorporateestablishedon1November2003LinderCivilAviationAct No. 10 of 2003. TheAuthority is 100% owned byGovernment of United Republic ofTanzaniathroughtheTreasuryRegistrar.

DuringtheyeartheAuthoritydidnothavesignificanttransactionswithrelatedparties:

Duefromrelatedparty 2011 2010 TZs ‘000 TZs ‘000 TanzaniaAirportAuthority 585,414 490,035 AirTanzaniaCompanyLimited 502,703 71,734 MinistryofInfrastructureandDevelopment* 52,446 448,446 GovernmentFlightAgency 533 5,837

1,141,096 1,016,052

*TheamountduefromMinistryofInfrastructureDevelopmentrelatetoexpensespaidbytheAuthorityontheirbehalfandhasbeenfullyprovidedfor.DuringtheyeartheAuthoritywasadvisedtotransferTZS396millionfromMinistryofTransporttoAirTanzaniaCompanyLimited.




24. RelaTeD PaRTY TRansaCTIons anD balanCes (Continued)

Key management personnel

Key management personnel are those persons having authority and responsibility for planning,directingandcontrollingtheactivitiesoftheAuthority,directlyorindirectly.KeymanagementpersonnelhavebeendefinedastheexecutivedirectorsoftheAuthority,andmembersoftheAuthority’sseniormanagement.

Compensation relating to key management personnel

Theremunerationofdirectorsandothermembersofkeymanagementduringtheyearwerefollows:

2011 2010 TZs ‘000 TZs ‘000

Shorttermbenefits 590,470 571,574

25. CaPITal CoMMITMenTs

Asat30June2011theAuthorityhadatotalcapitalcommitmentsamountingtoTZS2,450,450,000forconstructionoftheAuthority’sHeadOfficebuildinginDaresSalaam,installationofVOR/DMEinMwanza,AirNavigationEquipmentandatJuliusNyerereInternationalAirport-DaresSalaam.

2011 2010 TZs ‘000 TZs ‘000

Approvedbutnotcontractedfor 950,450 1,576,307 Approvedandcontractedfor 1,500,000 4,500,000

Total 2,450,450 6,076,307

26. ConTInGenT lIabIlITIes

TheAuthorityhasapendingcourtcasewherebyformeremployeesaresuingtheAuthorityforunfairdismissal.TheemployeesaredemandingacompensationofTZS40million.Theoutcomeofthecasesdependsoncourtruling.Directorshaveassessedthatnolikelyliabilityisexpectedtooccurandhavemadenoprovisioninthefinancialstatements.

27. UlTIMaTe oWneR of THe aUTHoRITY

TheTanzania CivilAviationAuthority is a body corporate established under TheCivilAviationAct No.10of2003,nowCivilAviationAct,(Cap80)of2006.

TheGovernmentoftheUnitedRepublicofTanzaniaistheultimateowneroftheAuthority.

28. RePoRTInG CURRenCY

ThesefinancialstatementsarepresentedinTanzaniaShillings(TZS‘000).

Director GeneralAviation House, 2nd Floor, Nyerere / Kitunda Road Junction,

P. O. Box 2819, Dar es Salaam, TanzaniaTel: (255) 22 2198100, Fax: (255) 22 2844300 / 2844304,

Email: [email protected], Website: www.tcaa.go.tz

Designed and Printed by:

CI GROUP LTD.

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