A land audit is only required for clients who own multiple properties.

The identification of land ownership is the vital first step in defining an immovable asset register. While there is no single, definitive source to define Client-owned erven, the combination of diverse sources result in a high degree of accuracy.

By definition, Immovable Assets are linked to a geographic position on the earth’s surface. This tangible reference forms the definitive basis against which all other data is linked.

Once the Client owned land has been clearly defined, the next task is to establish any improvements on the land and the area those improvements occupy. Complications that need to be addressed include:

• Differentiation between vacant land and sports fields/gardens etc.
• Multiple buildings constructed on a single erf
• Single building across several erven
• Multi-storey buildings
• Other improvements (i.e. swimming pools)

This aspect can be the most difficult to establish and keep current as the occupier, primary use and intensity of use can change without warning or record. Ideally, each portion of land and each building section must be categorised according to:

• Area description
• Area size
• Occupying dept
• Primary usage
• No of residents (overnight)
• No of day workers
• No of visitors
• Plus numerous other factors that will assist with utility usage and charge analysis.

The importance of completing the above Land, Improvement and Usage audits to achieve an accurate immovable asset list cannot be over-emphasised. Both national legislation and Local Authority bylaws use ownership and usage type to prescribe tariffs, rebates and charges that are applicable or permissible for any particular land parcel or building.

Usage analysis to determine incorrect volumes is similarly not possible until known factors such as no of people, usage type, floor size etc. can be compared to usage norms. For example, statistics of water consumption per occupier differs considerably between a domestic, prison, hotel or hospital environment. The same is true for property valuations per square meter.

Each rates and utility account, and the corresponding metered supply point are linked to the specific land and building recorded on our GIS. The historic usage volumes and charges for each utility point are referenced and compared to the expected volumes given the usage type and intensity of use. The fields of analysis include, but are not limited to:

• Tariff comparison to establish the least charge per unit
• By-law analysis to ensure all dispensations are fully utilised
• Volume comparison against industry norms and standards database
• Seasonal usage pattern analysis
• Establishment of baseline usage parameters

Additional investigation and analysis to achieve further savings will be commissioned by Venn as required, and at Venn’s charge.

Municipal Assessment Rates charges are calculated based on a rate-in-the-Rand of the property valuation, less prescribed allowances and rebates. The Valuation is the combined land and improvement value as per the valuation Roll, as determined by the Municipality’s valuators.

The combined valuation of land (including hanging properties) and improvements is normally reflected as a single rand amount on the rates account. The allowances, tariffs and rebates are also normally reflected on the rates account, or can be derived by decompiling the charges applied.

Valuation

Many Municipalities, particularly the larger Metros, have been somewhat bullish and robust in their valuation assessments resulting in many properties being valued well in excess of their market value.

Based on the land and improvements audit, Venn conducts quantitative, comparative and statistical analysis on the valuations applied to the property portfolio. Where such analysis indicates that the Municipal valuation is excessive, Venn will commission an independent survey and valuation of the land and individual building portions.

Venn’s Valuator shall represent the Client in all objection or appeal proceedings in order to argue and justify the reduced valuations. The charge of the Valuator and all representations shall be borne by Venn.

Tariffs, Rebates and Allowances

Certain Rebates and Allowances are automatic as they are prescribed by the MPRA while others must be applied for on an annual basis. Rebates are determined according to either ownership or usage type. Venn will research rebates and allowances applicable via the relevant legislation, and where additional or increased rebates are available, shall apply for the application of such rebates on the property concerned.

The onus of proving ownership or usage to the satisfaction of the local authority, and thereby achieving reduced tariff rates shall rest with Venn, who shall bear all charges involved.

Water usage is remarkably predictable once the type of use and quantity of people is known. Comparative and statistical analysis based on the land, building and usage audit, in combination with historical usage patterns will generally reveal sites with the greatest percentage of excessive water usage. This could be caused by meter inaccuracy, leaks, circular reticulation, faulty pressure reduction and non-return valves, water supply to neighbouring properties, and blatant water wastage.

Venn’s Technical Department uses state-of-the-art loggers, flow meters, ground microphones, leak correlators, electrical and acoustic pipe location detectors and other methodologies and techniques to locate leaks and supply reticulation.

Once the cause behind an anomaly is identified and isolated, Venn will investigate and report possible options for eliminating or reducing the problem.

Electricity measurement and billing is considerably more complicated than for other utilities. The volume (kWh) and maximum rate of consumption (kVA) are the two primary inputs on electricity accounts. Electricity tariff options depend largely on the installed capacity, the availability of supply to meet demand, and the user’s overall consumption pattern on a daily, weekly, monthly and seasonal basis, generally known as a load profile.

Venn’s technical team obtain load profiles either directly from council electronic meters or through the installation of data loggers. The load profile is then manipulated to accommodate seasonal usage variations which are derived from historical supplier invoices.

Venn’s analysis encompassing all usage data and supply tariff parameters enables the least charge-per-unit combination to be identified. Further optimisation and charge reduction techniques such as load control, load time shifting and power factor correction can then be deployed according to the benefits they will render.