5. Employer grants and project expenses The Auditor-General identified the following: a) According to the Skills Development Act Grant Regulation 7(5), a discretionary grant paid in terms of sub-regulation 7(1)(a) to (n) must fund all project costs for any project funded by a discretionary grant under sub-regulation 7(1) inclusive of project administration costs for the discretionary project subject to the approval by a SETA Board or Council. b) A separate budget for the project administration costs not exceeding a maximum of 10% of total project costs may be approved by the SETA Board or Council. c) The SETA could not provide the Board's approval for the administration expenses on discretionary project for audit purposes. d) ESETA recognised discretionary grant expenditure amounting to R1 283 000 which relates to prior periods in the current financial year.