March 2007 Inside GCM this month

LEAD STORY • 5 Star Golf Experience 1

COURSE MANAGEMENT • Are Organic Fertilizers an option? 4
SPECIAL FEATURE • The Johannesburg Open 5
FROM THE CMASA • Membership 7
BIRDIES AND BOGEYS • Snippets 9
TAXATION •Tax dispensation for golfing and other clubs 10
COURSE MANAGEMENT • “Thatch” – The No.1 killer  13
HR LEGAL • HIV/AIDS – The Legal Implications 15

A monthly newsletter brought to you by Compleat Golfer magazine.  Volume 3 Issue 3

The 5 Star Golf Experience Awards –

a uniquely South African event
Do traditional golf clubs stand a chance competing against more modern
multi-million Rand golf estates? Ian Leach, co-ordinator of the Compleat Golfer
5 Star Golf Experience Awards looks at what lies behind the statistics.
Compleat Golfer launched the 5 Star Golf today. In the words of Compleat Golfer editor philosophies and concepts required of a
Experience in 2002 and the initial awards Brandon de Kock “we hope that clubs will truly world class golf experience. To the
were presented to nine golf establishments rise to the challenge and in that way we will best of our knowledge this level of judging
in February 2003. The number of recipi- contribute to improving standards of service and awarding clubs with 5 Star status is
ents grew to eleven when the 2004 results excellence and facilities at golf courses unique to South Africa. The current process
were announced in March 2005 and now to throughout the country.” The process differs considers nine sets of criteria each of which
fourteen in 2006, to be awarded at the 2007 from golf course ranking in that it takes the has a number of points allocated. During
awards dinner. total golf experience into account while the a visit to a club the panellist will consider
Why was this process initiated? It was course ranking process considers only techni- each of these criteria based on the actual
the brainchild of the former editor, Duncan calities of the course itself. level of service and observations experi-
Cruickshank, whose vision was, “to create From the experience gained by the panel enced on the day. The process is designed
something that all golf clubs in the country of judges during the initial four years the cri- to be as objective as possible. When two
could strive towards”. This position has not teria were expanded and formalized in 2006.
changed over the years and remains true They still however retain all of the original Continued on page 3

The Country Club Johannesburg. A consistent “traditional” 5 Star Award winner.

 NDREW WILSON • email: anorbury@iafrica.com • cell: 082 575 3861

■ Editorial A A monthly
■ AdvertisinG Simon Turck (National business manager) • email: simon@rsp.co.za • cell: 083 252 8387 newsletter brought
to you by
■ SUBSCRIBE to GCM for R240 a year. Contact Natalie Shekleton • tel: 011 301 4448 • email: natalies@rsp.co.za

Golf Club Management March 2007 


Continued from page 1
or more scores are received they are aver-
aged against that specific club. At the end
of the judging period the panellists meet
as a team to consider the final results and
to decide on the eventual recipients of the
5 Star Golf Experience Award. At this time
the team also consider what is known on the
“G Factor” – that something special that dif-
ferentiates each recipient from others.
The criteria used to evaluate a club and
the weighting of each are:
1 Club house facilities 13%
2 Golf Course – Service & 8%
facilities
3 Golf Course – Quality of 22%
experience
4 Halfway House 5%
5 Practice Facilities 5%
6 Quality of Customer 15%
Service
7 Price/Value relationship 7%
8 Services Offered 15%
9 Ambience 10%
For the first time this past year a statistical
record was maintained and this has high-
lighted a number of facts and trends which
should be of interest to club committees and
management. One of the criticisms levelled
against this 5 Star process by some clubs is
that it is, by design, achieveable only by the
exclusive and wealthy. They argue that the
every day members’ club cannot afford to
introduce and offer these high standards of
service excellence. This argument however
is not entirely correct and this is bourne out
in the results recorded.
Another negative argument presented is
that traditional golf clubs cannot compete
against the new, modern, multi-million
Rand golf estates. The majority of recipi-
ents of the award are certainly golf estates
and resorts but analysis of the data gath-
ered suggests that this is because they pay
more attention to service excellence and not
because they have more resources to plough
into their golf experience. More traditional
golf clubs can and should achieve 5 Star
status by paying more attention to detail on
and off the golf course and by improving
their range and levels of services offered.
Certainly it might cost clubs to do this but in
return they could rightfully expect to benefit
from an improvement in total turnover as a
direct result of better customer care.
A comparative analysis between the leading
golf clubs and golf estates shows that the “tra-
ditional” golf clubs have a distinct advantage
on the criteria that considers Price/Value
Relationship. They also score particularly
well on Ambience. This is understandable
when one considers the tradition and his-
tory of many of the older clubs along with
all their trophies and club memorabilia. The
newer more modern facilities cannot expect to
achieve these levels of ambience overnight.
The Golf Course Experience carries
a weighting of 22% and is an important
component of the 5 Star Experience. This
takes into account the experience of the
player on the course itself and includes
playability, shot values, condition, memora-
bility, design balance and routing of the golf
course. Traditional golf clubs feature well
on this criteria notwithstanding the fact that
so many new golf estate and resort courses
have been built at enormous cost. The older
more established golf courses however have
had many years to mature and develop.
They remain fortunate enough not to be sur-
rounded by houses imposing on the player
from all directions.
The glaring weakness in traditional golf
clubs vs. golf estates and resorts lies in the
criteria of:
• Club House Facilities
• Golf Course Services and Facilities
• Quality of Customer Service, and
• (Range of) Services Offered
The older golf clubs cannot compete with
the modern clubhouses built in recent years
on so many of the new resorts and estates.
Having said that, it is a fact that too many
clubs have simply not managed their club-
house facilities well over the years and have
allowed them to deteriorate into unaccept-
able condition. In some cases this will cost
millions of Rand’s to restore while in others
it might mean no more than introducing
proper day-to-day maintenance routines. In
any event this criteria carries a weighting of
only 13%. What is more important, when
special feature
a visitor or member leaves a club after a
day of golf and reflects back on the experi-
ence, what do they think of first? Certainly it
won’t be the bricks and mortar of the build-
ings! Above anything else, most will recall
the way they were received and treated at
the club together with their experience on
the golf course. This is where estates and
resorts have taken the initiative and where
traditional golf clubs, to their detriment,
have too often remained “traditional”.
The three service-related criteria viz. Golf
Course Services and Facilities, Quality of
Customer Service and Services Offered by
the club have a combined weighting of 38%.
Unfortunately service excellence is not a
hallmark of South African society. Nor is it
the outstanding feature of the South African
golf experience. Golf estates and resorts
outperform traditional golf clubs on these
criteria in every respect. This is possibly
because, as a rule, they are commercially
driven while the typical golf club is inwardly
focused on its members. Customer Service,
and everything related to it, is the one area
where golf clubs can make enormous strides
with very little effort and at relatively low
cost. The golfing public has become more
demanding and rightfully expects to receive
excellent service at a fair price.
The 5 Star Golf Experience is an all-
embracing experience that considers every
aspect of what a club has to offer. We hope
that all golf clubs throughout the country, big
or small, metropolitan or rural, traditional
club or estate, new or old, will respond to the
challenge to continuously improve their own
level of golf experience offered to members
and visitors. Not all clubs can achieve 5
Star status and that is not important. What
is important is that every club presents itself
as best it can, on a repetitive basis, to every
person who has the pleasure of visiting and
playing golf at that facility.
A full report on the 5 Star Golf
Experience Awards appears in the
March 2007 issue of Compleat Golfer.
Congratulations to the four new award
winners; see Birdies and Bogeys on
page 9 for details.
Ian Leach, Co-ordinator of the Compleat
Golfer 5 Star Golf Experience programme,
can be contacted on 082 892 8693.
Golf Club Management March 2007 
course management
Are Organic Fertilizers an option?
Darren Berry of Golf Data looks at the pros and cons of using organic fertilizers.
The pressure is slowly mounting on the
golf course maintenance industry to improve
its environmental awareness and adjust
maintenance practices accordingly.
The use of organic fertilizers, to replace
the standard chemical versions, is an area
which has received considerable attention,
but is it a viable option?
The maintenance of healthy turf grass,
which is achieved with the lowest intensity
of maintenance inputs, should always be
the goal.
Turf managers have many options when
selecting products with which to fertilize
their turf. One of these options is the use of
‘natural’ organic fertilizers.
Superintendents must be aware though,
that not all organic products will provide
value for money. Like any category of
product, they have both advantages and dis-
advantages, and some products will simply
not allow for the effective maintenance of
healthy turf grass.
If selected correctly, organic fertilizers
can provide the following advantages to the
golf course and community alike:
• The discouragment of turf disease.
• The encouragement of microbial activity
in the soil.
• The improvement of the organic content
of the soil.
• The use of community by-products.
There are various factors which one must
consider when selecting a suitable organic
product for use on your course.
Nitrogen is the primary element required
by the plant for healthy growth. The nitrogen
provided by the organic fertilizer is exactly
the same as that provided by a standard
chemical product. The turf grass plant
is unable to distinguish between, or use,
organically or chemically applied nitrogen
differently. The nitrogen content though of
organic fertilizers can vary considerably and
is generally significantly lower than that of a
chemical product. One must therefore make
careful note of the amount of actual nitrogen
being applied with an organic application.
It is due to this lower nutrient content that
an organic application will normally involve
 March 2007 Golf Club Management
Organic fertilizers encourage microbial
activity in the soil.
the use of a far higher product volume to
accomplish the same results as a standard
chemical application. This increased bulk
can have disadvantages. Storage and trans-
port costs can sometimes be a concern
depending on site specific conditions and
budget restrictions.
A pelletized organic fertilizer will also not
physically breakdown or dissolve in the same
fashion as a chemical product, which means
one will have to accept the presence of fertilizer
pellets on the turf grass surface for two or three
days after the application. If high volumes are
applied, this presence can be significant.
The maintenance of healthy
turf grass, which is achieved
with the lowest intensity of
maintenance inputs, should
always be the goal.
The higher application volumes can also
have advantages. Organic products will
normally contain various quantities of sec-
ondary and micro-nutrients.
The higher application volumes will ensure
that adequate levels of these nutrients are main-
tained. They are sometimes overlooked in
fertilizer applications to fairways and roughs,
where nitrogen, phosphate and potassium
levels generally receive the most attention.
The ash content is an important factor to
consider, especially when utilizing organic
products on greens. Ash content can vary
considerably between different products.
Ash can be defined as the inorganic mate-
rial which is left after all the organic matter
is combusted. Ash could include sand, silt,
clay or nutrient salts.
The presence of significant quantities
of ash can be a concern due to its potential
to accumulate in the top layers of the soil
profile, thereby increasing the percentage
of fines. This accumulation could lead
to unwanted layering and poor or inhib-
ited movement of oxygen and moisture.
If a problem does develop, an aggressive
aeration and topdressing program will be
required to rectify the situation.
The release rate of organic fertilizers
is dependent on microbial activity. The
microbes break down the organic fertilizer
and convert the nutrients to forms which
the plant is able to utilize. The microbial
activity is in turn dependent on soil tem-
perature. The higher the temperature the
more microbial activity will be present. As
the temperatures rise, the release rates and
curves associated with organic fertilizers
become more difficult to predict. The most
effective and predictable release rates are
experienced with soil temperatures between
11ºC and 28ºC.
The soil pH will also affect the release
rates due to decreased microbial activity.
The pH should be maintained above 5.5.
The ideal range for healthy turf growth is
between 6 and 6.5.
The use of natural organic fertilizers
should be encouraged during the golf course
construction phase. The pre-planting or
seeding period provides an ideal opportunity
to incorporate an organic fertilizer into the
soil. If selected carefully, the product will
provide the necessary pre-plant fertility as
well as kick-starting the microbial activity
and organic component of the soil.
All factors considered, the use of organic
fertilizer on golf courses is a viable option
provided that the products are selected care-
fully and that all stake holders are aware of the
potential disadvantages attached to their use.
For more information contact
Darren Berry of Golf Data on
darren@gdmaint.co.za or
on 0836719399 or (044) 3840680/3.
 SPECIAL FEATURE

The Johannesburg Open:

an impact assessment.
The Joburg Open was seen by over 400 million people worldwide. GCM asked
Garry Marais, CEO of the Royal Johannesburg and Kensington Golf Club and
Ross Grainger the Chairman of the Greens Committee what went into the preparation
of the course before the event, and what were the benefits to members and future
visitors. Here’s what they had to say.
Garry Marais – CEO of Royal requested that the greens run at 10ft 6ins on
Johannesburg and Kensington Golf Club. the stimpmeter and not any faster.
During the run-up to the event and now that The East Course fairways were given
the tournament is successfully behind us, we an application of slow release fertiliser and
were frequently asked “what has the Joburg once coverage was achieved this was then
Open done for Royal?” Now that we have followed by the application of a growth
had time to reflect on matters, a number of retardant which has the side benefits of
very positive aspects have emerged. Firstly, enhancing colour and reducing flowering
members have seen for themselves the fan- of the kikuyu. No fairways were reshaped
tastic exposure and accolades the courses as there simply was not enough time for the
received from players and tournament grass to grow. The rough on the East Course
organisers alike. was allowed to grow to 110mm whilst
We watched the opening ceremony with the rough on the West Course was kept at
quite a lot of emotion and no doubt many The team at Royal pulled out all the stops 75mm.
members felt the same. Our captain had for the Joburg Open. In addition to the above big ticket items
every reason to be proud of his team at a myriad of activities were tackled, for
Royal. Lots of effort and hard work went example the top dressing of all spring dead
into the planning and hosting of the event, premier, the mayor, as well as other VIP's spots.
in addition to the very thorough plan- and officials have been hosted at our club. Both golf courses, but particularly the
ning and execution by experienced events • The proposal of a traffic light at the East, received some wonderful praise
organiser Sharon Bruyns on behalf of the Gemmil/Club intersection has been well- from players, commentators, news editors
promoters easyGolf Worldwide.  received by city officials and pursuing and officials during the Joburg Open. The
Apart from TV coverage and plenty of this prospect looks very encouraging. courses were simply magnificent and the
pats on the back for course superintendent presentation superb. Well done to Graham
Graham Corbett, there are other spin-offs, Ross Grainger – Chairman of the Greens Corbett and his entire team.
not only for the club but for the suburb and Committee. TV coverage of the event was extensive
community as well: A tremendous amount of tournament spe- with an estimated worldwide viewership of
• Street lighting has been repaired and cific work went into the preparation of the 400 million. Significant time was given to
upgraded. two courses. The greens received a special our Audobon status, and the development of
• Pavements have been cleaned up. fertiliser treatment and then as the tourna- wetlands, natural grasses and other environ-
• Our security systems, surveillance as well ment approached watering was done more mentally responsible activities.
as manpower complement, have been and more by hand so that a minimal amount And finally the weather was really kind
reviewed and upgraded. of irrigation water was used which in turn to us although it could have rained a little bit
• The bridal path along the Huddle Park firmed up the greens. At the same time the less in late December.
boundary has been cleared. greens were rolled to smooth them out and Much of the work that went into the prep-
• Trees on the boundary have been trimmed the mowing height dropped in steps from aration of the courses should provide long
down as well as thinned out. 3.5mm to 3.0 mm (rolling provides short term condition benefits. 
• Fences along the Huddle boundary have term benefits but in the long term compacts
been repaired. the greens which then have to be hollow- For more details contact
• High-ranking officials of the city such as the tyned). Interestingly the tournament directors Garry Marais on 011640 3021.

Golf Club Management March 2007 

CLUB MANAGEMENT ASSOCIATION OF SOUTHERN AFRICA
Is there a hole in the bottom of your
membership bucket?
All clubs face the challenge of membership attrition. Beryl Acres, General Manager of
the CMASA, looks at ways to help you keep your members.
The old adage of “there are two certainties in
life – death and taxes” could be expanded to
include “in club life – members will resign;
this is inevitable”. You have no control over
some of the causes: relocation, retirement,
illness or financial. However the primary
controllable reason why a member resigns
from your club is “lack of use”. Clubs who
are effective in reducing their membership
attrition are clubs that proactively prevent
member apathy or dissatisfaction. Some of
their needs, interests and expectations are the
same ones they had when they joined the club,
while other’s may be new due to a change in
lifestyle. Don’t wait until the member resigns
to find out what they did not like about your
club.
Let’s look at eight ways you can reduce
attrition?
• Determining Members’ Needs, Interests
and Expectations
– Conduct focus group sessions,
member surveys and interviews. These
are great for identifying any significant
changes or trends affecting member
expectations and needs.
– Don’t take it for granted that you
know why your members are joining
the club and what they want – ASK
THEM AND KEEP ASKING.
– Club staff should interact with mem-
bers regularly. It is important that the
staff be aware of the members’ needs,
to service them, and to continuously
ask what the club could be doing better
to satisfy their needs and interests.
• Respond and act upon
recommendations
– If you receive recommendations from
members and you do not respond to them
or incorporate them in your operations or
long range plan, you run the risk of frus-
trating and sometimes infuriating your
members.
– Your members will stop informing you
of what they want and how they feel.
They will become dissatisfied with the
facilities and services, resulting in a lack
of use, and ultimately a resignation.
Continued on page 8
 CMASA
Continued from page 7

– Club Committees and staff should have an efficient system,

whereby all comments and recommendations are collected.
No matter how large or small the contribution, these should
be responded to in a timeous manner.
• Member Recognition
– Member recognition should be a principal standard of
operation in a club. If a club is to be a members’ “home
away from home”, they must feel as though they belong.
Treat him as a “customer” and he will remain a “customer”.
He will purchase the product and move on. Treat him as
a “member” and he will behave as if he belongs, and will
want to maintain his membership.
– Make a point to have your staff learn three members’
names a day.
– Include as many as possible of your members’ names in
your newsletters. They love to read about themselves.
• Member Involvement
– Inform members of the events you know will interest them.
– Offer introductory golf lessons – what is that I hear – “who is
going to pay for this?” Your member will appreciate the effort.
– Involve a members’ spouse and children in activities at
the club. A member is less likely to resign if his spouse and
children are using and enjoying the club.
– Monitor your members’ usage pattern. Call the member
who has stopped using the club to find out why.
• Thank your members
– Members do the club a favour every time they visit the
club. Remember to thank them for their support. Some
clubs send a letter once a year to members, signed by the
Club President, simply thanking them for being a member!
• Continuous Value Building
– It is important to reinforce your members’ pride in their
club. Ensure your newsletters promote the club’s facilities,
forthcoming events and services.
– Create new membership benefits. Maintaining tradition is
important but so is adding new services.
• Communication
– How well do you communicate with your members?
– Do you inform your members of new policies and
procedures?
– Do your members know your long-range plan?
– Informed members are more comfortable with their club
when they know what is happening, what is planned and
what is expected of them.
• Quality
– Members use their club by choice. A concerted effort at
all levels of operation to deliver quality is essential. Proud
members will use their club and be reluctant to resign.
Service the needs, interests and expectations of your members.
Ask them what the club could be doing better – then take action.
By implementing a few of these ideas, you will reduce attrition.

Beryl Acres of the CMASA can be contacted on

(011) 482-7542 or at gm@clubmanagement.co.za

LABOUR PAINS
Snippets of Labour law
What are your staff’s
current maternity leave
entitlements?
Your employees are entitled to four month’s
maternity leave and although you do not have
to pay them during this period, you have to
ensure that they are able to claim UIF.
An employee should let you know in
writing the date on which she intends to
commence her maternity leave and the date
on which she intends returning to work.
This should be given to you at least four
weeks before the intended commencement
of maternity leave.
An employee may commence maternity
leave any time from four weeks before the
expected date of birth, unless otherwise
agreed, and should return no sooner than six
weeks after the birth.
These dates can vary if a medical practi-
tioner or midwife certifies that it is necessary
for the employee’s health or for that of the
unborn baby.
Further more, an employee is entitled to
job security during pregnancy and the period
of maternity leave. To refuse employment,
terminate a contract or change the terms
and conditions of employment based purely
on the pregnancy of the employee would
be deemed an automatically unfair labour
practice. If found guilty, your club could be
liable for up to two years’ compensation.
For the full details on maternity leave
refer to section 25 of the Basic Conditions
of Employment Act or go to the government
website www.labour.gov.za
New winners of the 5 Star Golf Experience Awards
For your club to be awarded 5 Star status in
the Compleat Golfer 5 Star Golf Experience
Awards is probably as challenging as win-
ning an international golf tournament.
GCM would like to congratulate the four
new winners to be announded at the 2007
awards’ dinner. You guys and gals have
obviously put a lot of time and effort into all
facets of the golf experience at your clubs.
Well done to the four of you and keep it up;
you are joining a very select group.
Reader’s Comment
Jon Skead, the Captain of Golf at the
Victoria Country Club contacted GCM
to say how much he had enjoyed the
December and January articles on the
relationship between Club and Pro.
Their course has been closed since May
2006 to allow Golf Data to revamp their
course design and install new greens.
They are hoping to re-open their course
as this issue of GCM goes to press. They
are also considering re-structuring their
operations in line with the suggestions
made in the two lead articles.
Good luck Jon with both the re-struc-
turing of your course and your operations.
We at GCM look forward to hearing how
you get on.
To everyone else out there, please get
in touch with us so we can keep in touch
with you.
Contact details: Andrew Wilson
of Golf Club Management can be
contacted on 0825753861 or
021 7979866 or anorbury@iafrica.com
People on the move
GCM congratulates the following people
on their recent appointments and wishes
them well for the future.
Andrew Truluck, to Glendower Golf
Club as Golf Professional.
Adriaan de Waal, to Oubaai Golf Estate
as Clubhouse Manager.
Gavin Woodroffe, to Oubaai Golf
Estate as Golf Director.
The four new winners are:
• De Zalze Golf Estate – Western Province.
• Erinvale Golf Estate – Western Province.
• Selbourne Country Club
– Kwazulu-Natal.
• Steenberg Golf Club – Western Province.
See our feature article on pages 1 and 3
in this issue of GCM. For more details of
the awards and a full list of winners, refer
to your March copy of Compleat Golfer.
birdies and bogeys
The Pro Shop
The Pro Shop should not only be a centre
of excellence for advice on all matters
relating to golf; it should also be a centre
of excellence when it comes to customer
service. A core component of customer
service is the sales technique. How often
are we, as customers, faced with either
apathy or hard sell for something we don’t
really need. If you want your members
and visitors to view you as their pre-
ferred provider of golf related equipment,
clothing and accessories, the following
five-step selling process can help.
• Ask. The first step is to ask the right ques-
tions. Find out what the customer is really
looking for. What the customer wants
and what the customer needs may be
two different things. Make sure you fully
understand what the customer needs!
• Listen. Then you need to listen, not
only with your ears but also your eyes.
Try to put yourself in your custom-
er’s proverbial shoes. By listening and
observing you need to not only fully
understand what the customer needs, but
also why they need it.
• Advise. Now you are in a position to
advise the customer on the best solutions
to meet their needs. Make sure your
advice and suggestions are in line with
your customer’s needs and not what you
would like to get rid of! You may laugh,
but it is a common fault.
• Reassure. Once the sale is agreed upon
let the customer know that you are always
there for them. At the end of the day, it
is the customer’s choice whether to buy
or not; let them know that you think they
have made an excellent choice, and if
they have any further needs or problems
they must feel free bring them to you.
• Thank. As they are about to leave
your shop, thank them for their business.
You want them to come back again so
let them know that you appreciate their
business. Pro shops can rarely compete
on price but you can compete on person-
alised and professional service.
Remember, people love to talk to
their friends about the service they
received, both good and bad. What
they say about you is in your hands.
Golf Club Management March 2007 
taxation
The new tax dispensation for golfing
and other recreational clubs
Golf clubs are facing significant changes to the tax laws as from 1st April 2007. GCM
asked Erle Koomets of auditors and gof sponsors PriceWaterhouseCoopers for advice.
Up until now, section 10(1)(d)(iv)(aa) of the
Income Tax Act 58 of 1962 has granted an
exemption from income tax to any company,
society or association established to provide
social and recreational amenities or facili-
ties for its members (in short, recreational
clubs). The exemption was extremely gen-
erous, for it covered all of the club’s income,
even its investment income.
The definition of “recreational clubs” in
the new legislation is wide enough to cover
what are more commonly called “sporting
clubs”, such as golf clubs.
SARS has become concerned that recrea-
tional and sporting clubs have been enjoying
this total tax-exemption even where they
allow their amenities to be used (for a fee)
by non-members, and that some clubs are
involved in extensive business activities to
supplement their income from membership
fees. Many clubs, for example, hire out their
premises to non-members for weddings,
parties and corporate events.
SARS has also taken note of concerns
that the exemption accorded to recreational
clubs is anomalous, in that they are presently
treated more leniently than public benefit
organizations, which have recently been
made subject to a system of partial taxation.
Under the new tax dispensation, foreshad-
owed by the Revenue Laws Amendment Bill
of 2006, recreational clubs are to be subject
to a system of partial taxation. The new tax
rules will come into effect at the start of rec-
reational clubs’ tax years which commence
on or after 1 April 2007.
Exempt club income under
the new tax rules
Under the new dispensation, recreational
clubs will be exempt from tax on income
they derive –
• in the form of membership fees or sub-
scriptions paid by members; and the
club’s constitution will have to state that
10 March 2007 Golf Club Management
The definition of
“recreational clubs” in the
new legislation is wide enough
to cover what are more com-
monly called “sporting clubs”,
such as golf clubs.
Where a non-member pays fees,
such as green fees, to use the
club facilities, those fees will not
be exempt income in the
hands of the club.
all members are obliged to take out annual
or seasonal membership; (a club will not
be approved by SARS if its constitution
provides for “day members” or “visiting
members”. Where a non-member (such
as a visitor to the club) pays fees, such
as green fees, to use the club facilities,
those fees will not be exempt income in
the hands of the club;
• from any business undertaking or trading
activity that is integral and directly related
to the provision of social and recreational
amenities to members of the club, and
which is carried on substantially on a
cost-recovery basis and does not result in
unfair competition in relation to taxable
entities; all clubs will be anxious that,
inter alia, the club bar and restaurant,
which are clearly business undertakings,
fall under this category and are regarded
as “integral and directly related” to the
provision of social and recreational
amenities to the club members, so that the
income is tax-exempt. It is not a foregone
conclusion that SARS will automatically
accept that all club bars and restaurants
fall into this category, particularly if the
profit margins, for example on the sales of
liquor, go far beyond mere cost recovery;
• from any fund-raising activities of the
club which are of an occasional nature
and undertaken substantially with
assistance on a voluntary basis without
compensation; the key words here are “of
an occasional nature” and “substantially”;
all clubs which undertake fund-raising
activities will need to ensure that the
fund-raising event complies with these
restrictions, or else the moneys raised
will not be tax-exempt;
• from any other source, but only up to a
maximum of R50 000 per annum or 5%
of the total membership fees and sub-

scriptions payable by its members during
the particular tax year, whichever is the
greater; this will cover any other kinds
of income derived by the club during a
given tax year;
Each of these bulleted points presents
problems of interpretation on which a club
will have to seek expert advice as to how
they apply to that particular club.
Phrases such as a “business undertaking
or trading activity that is integral and directly
related to the provision of social and recrea-
tional amenities to members of the club” and
“occasional nature” are somewhat rubbery,
and only time will tell how SARS and the
courts will interpret them.
The compliance burden
Even if the new tax rules do not result in
a club having to pay a great deal of tax, or
indeed any tax at all, a substantial and poten-
tially expensive compliance burden will fall
on clubs to arrange their affairs so as to keep
in line with the new legislation.
Of particular concern will be that amounts
derived from non-members will not be tax-
exempt, and will have to be recorded in
the club’s financial records as such, and
disclosed as such in the club’s tax returns.
For example, if a non-member buys a drink
at the club bar, that money will not be tax-
exempt in the hands of the club.
Clubs are going to have a rule either that
their facilities are only open to members,
or that any food, drink, etc, provided to a
non-member must be paid for by a member
– or the club will have to devise a method
of tracking each and every amount paid by
non-members.
Compliance expenses will include the
cost of taking professional advice on legal
and accounting issues raised by the new
legislation, and perhaps the cost of
modifying the club’s computer sys-
tems to record amounts paid to the
club by non-members.
Expenditure in producing
exempt income; roll-
over of capital gains
Where some of a club’s income falls
outside the exempt categories, the
club’s expenditure incurred in pro-
ducing tax-exempt income cannot
be offset against non-exempt income when
calculating the club’s taxable income and
hence its tax liability.
Capital gains on the disposal of club
assets, for example, the sub-division and sale
of part of the club property, will qualify for
roll-over relief, and CGT will be deferred if
the club uses the proceeds of the sale to pur-
chase an asset for the club that will produce
tax-exempt income.
Tax exemption for
recreational clubs will no
longer be automatic, and
clubs seeking the benefits
of the new tax dispensation
will have to apply to SARS
for exemption.
Clubs will have to apply to
SARS for exemption
Tax exemption for recreational clubs will
no longer be automatic, and clubs seeking
the benefits of the new tax dispensation
will have to apply to SARS for exemption
in much the same way as public benefit
organisations.
Clubs are to be accorded a lengthy window
period in this regard, and application must
be made by 31 March 2009 or the last day of
the club’s first year of assessment.
TAXATION
The Commissioner cannot withhold
approval if the club’s constitution complies
with the new section 30A. In this regard, the
constitution must stipulate that –
• the club is committed to carrying on its
activities in a non-profit manner;
• the club’s surplus funds cannot be distrib-
uted, except upon dissolution, in which
event the club must transfer its funds and
assets to another SARS-approved club or
to approved public benefit organization;
• the club pays only reasonable
remuneration;
• all members are entitled to annual or sea-
sonal membership;
• members cannot sell their membership
rights;
Where a club’s constitution does not sat-
isfy these requirements, it will suffice if a
person in a fiduciary position vis-à-vis the
club gives the Commissioner a written under-
taking that the club will be administered in
compliance with these requirements.
Before granting approval, the
Commissioner must be satisfied that the
club is and was not knowingly involved in
or a party to tax avoidance schemes.
Violation of the provisions of section 30A
can result in the club’s forfeiting its tax-
exempt status, but SARS must give the club
prior notice before withdrawing its approval,
and an opportunity to put its affairs in order
within a stipulated period.
Once the Commissioner has withdrawn
approval of a recreational club, it must
within six months transfer its remaining
assets to another approved recreational club
or an approved public benefit organisation,
other than a connected person vis-à-vis the
club.
If the club fails so to transfer its assets,
or take reasonable steps to do so, then the
market value of the assets not transferred,
minus the club’s bona fide liabilities, will
be deemed to be taxable income accruing to
the club in the tax year in which the
Commissioner withdrew approval.
For further information,
please contact Erle Koomets on
+27 (011) 797 4036 or via e-mail
at erle.koomets@za.pwc.com
Golf Club Management March 2007 11

“Thatch” – The No. 1 killer!
Thatch may look cute on country cottages, but there is no place for it on your golf
course. Danny Maritz of Turftek identifies what causes thatch, the problems it
brings and suggests some solutions.
When most of us hear the word “thatch” it
immediately triggers the thought of a lush,
dense lawn. This, however, is not quite
what “thatch” is. In short, thatch could be
described as a build up layer in the soil con-
sisting mainly of dead organic material. This
normally occurs in the top 100mm (4”) of
your growing medium.
The question now is: why is it a problem?
A good growing medium will continu-
ously supply plant roots with water, air and
nutrients in balanced proportions. When a
“thatch layer” exists, a number of problems
will arise over time.
Firstly, thatch itself (depending on how
thick the layer is) will be in a constant state
of decomposition. This process occurs natu-
rally and is caused by bacteria. When the
bacteria are at work they generate heat and
hydrophobic conditions. This will cause
poor water infiltration into your root-zone.
Timely verti-cutting and scarifying can reduce the risk of thatch developing.
The ultimate result will appear to be under-
watered turf and die-back.
The second problem that will now start
appearing is weeds. Depending on the tem-
perature, a healthy turfgrass root system is
normally between 100mm and 250mm deep.
Regular Verti-cutting and Hollow-tining
is required if you would like to avoid
thatch build-up.
The availability of shallow water will pro-
mote the growth of shallow rooted plants
such as Moss and Poa annua.
The third problem with thatch is that it
is one of the elements needed to form one
of our most destructive problems on greens
called Black-layer. This condition will occur
COURSE MANAGEMENT
where thatch is exposed to anaerobic con-
ditions (absence of air). Instead of your
bacteria breaking it down, it will start to
rot as the absence of air will kill the bac-
teria. The rotting organic layer will then turn
black and produce sulfuric gasses (hydrogen
bi-sulfide) which are toxic to turf and there-
fore cause it to die-back.
Where to from here? Thatch is a silent
killer and takes years to become a monster.
Often greenkeepers inherit these problems
and need to sort it out. You might get a bit of
resistance from the committee at first. (Why
have we never had a problem to deal with
like this in the past?)
At Centurion Country Club we had a bad
case of black-layer four years ago. We made
the decision to double hollow-tine with big
tines twice that year. By removing the black-
layer and replacing it with new sand we are
virtually clear of our problem without major
cost to the club.
Methods of thatch control:
Regular Verti-cutting and Hollow-tining
is required if you would like to avoid
thatch build-up. Don’t over-fertilise your
turf, rather keep it lean and employ a rep-
utable consultant if you are unsure.
Greens should be dusted as often as
possible. Fairways and tee’s should be
scarified and hollow-tined annually and
clippings should be picked up at least
once per week in the growing season.
For more information on tackling Thatch
you can contact Danny Maritz of Turftek at
connall@rootssa.com or on 012 8077282.
Golf Club Management March 2007 13

HIV/AIDS – The Legal Implications
In last month’s GCM article on HIV/AIDS we outlined an eight-pronged approach to
tackling the challenges of the pandemic in your club or business. This month Andrew
Wilson of GCM focuses particularly on the legal implications.
Although HIV/AIDS is not a notifiable dis-
ease, employers have a legal responsibility
to ensure that the policy principles, outlined
in the government’s Code of good practice
on key aspects of HIV/AIDS and employ-
ment, are communicated to and understood
by employees, and that the principles are
protected and practiced in the workplace.
These policy principles are:
1. The promotion of equality and non-dis-
crimination between individuals with
HIV infection and those without, and
between HIV/AIDS and other compa-
rable health/medical conditions.
2. The creation of a supportive environ-
ment, so that HIV infected employees are
able to continue working under normal
conditions in their current employment
for as long as they are medically fit to
do so.
3. The protection of human rights and dig-
nity of people living with HIV or AIDS is
essential to the prevention and control of
HIV/AIDS.
4. HIV/AIDS impacts disproportionately
on women and this should be taken into
account in the development of workplace
policies and programmes.
5. Consultation, inclusivity and encour-
aging full participation of all stakeholders
are key principles which should under-
pin every HIV/AIDS policy and
programme.
To support these policy principles the
following seven government Acts, in con-
junction with the Constitution, have legal
implications within the employment arena.
1. Employment Equity Act, No 55 of 1998.
2. Labour Relations Act, No 66 of 1995.
3. Occupational Health and Safety Act, No
85 of 1993.
4. Compensation for Occupational Injuries
and Diseases Act, No 130 of 1993.
5. Basic Conditions of Employment Act. No
75 of 1997.
6. Medical Schemes Act, No 131 of 1998.
HUMAN RESOURCES – LEGAL
7. Promotion of Equality and Prevention of
Unfair Discrimination Act, No 4 of 2000.
To save you the unenviable task of reading
all the Acts in detail, GCM has selected the
main relevant sections contained in the Acts
as they relate to golf clubs.
Section 6(1) of the Employment Equity
Act provides that no person may unfairly
discriminate against an employee, or an
applicant for employment, in any employ-
ment policy or practice, on the basis of his
or her HIV status. In any legal proceedings
in which it is alleged that an employer has
discriminated unfairly, the employer must
prove that any discrimination or differentia-
tion was fair.
No employee, or applicant for employ-
ment, may be required by their employer
to undergo an HIV test in order to ascertain
their HIV status. HIV testing by or on behalf
of an employer may only take place where
For more information
on the government’s Code
of Good Practice on Key
Aspects of HIV/AIDS and
Employment visit their
website www.labour.gov.za
the Labour Court has declared such testing
to be justifiable.
In accordance with Section 187(1)(f)
of the Labour Relations Act an employee
with HIV/AIDS may not be dismissed
simply because he or she is HIV positive
or has AIDS. However where there are
valid reasons related to their capacity to
continue working and fair procedures have
been followed, their services may be termi-
nated in accordance with Section 188(1)(a)(i)
of the Labour Relations Act.
In terms of Section 8(1) of the
Occupational Health and Safety Act, an
employer is obliged to provide, as far as is
reasonably practicable, a safe workplace.
This may include that the risk of occupa-
tional exposure to HIV is minimised.
An employee who is infected with HIV
as a result of an occupational exposure to
infected blood or bodily fluids, may apply
for benefits in terms of Section 22(1) of the
Compensation for Occupational Injuries and
Diseases Act.
In accordance with the Basic Conditions
of Employment Act, every employer is
obliged to ensure that all employees receive
certain basic standards of employment,
including a minimum number of day’s sick
leave, [Section 22(2)].
In accordance with Section 24(2)(e) of the
Medical Schemes Act, a registered medical
aid scheme may not unfairly discriminate
directly or indirectly against its members on
the basis of their “state of health”.
In accordance with both common law
and the Constitution, all persons with HIV
or AIDS have a right to privacy, including
privacy concerning their HIV or AIDS
status. Accordingly there is no legal onus on
an employee to disclose their HIV status to
their employer or to other employees.
Andrew Wilson
Human Resource Strategist
Cell: 0825753861
E-mail: anorbury@iafrica.com
Golf Club Management March 2007 15