COMPANIES: FINANCIAL STATEMENTS

G.P.MVUBU

INTRODUCTION Financial statements are the presentation of balances in the three statements,

namely the statement of profit or loss, the statement of changes in equity and the statement of financial position. The fourth statement, namely the statement of cash flows

These statements focused on the presentation, and not necessarily on the disclosure, of balances because it was prepared for the owner and the employees of the entity, who are familiar with the circumstances and activities of the entity. The financial statements prepared in this work up to now, are also known as financial statements for internal purposes.

Financial statements prepared for internal purposes, has the characteristic that the expenses in the statement of profit or loss basically represent all the balances of the general ledger expense accounts. Smaller expenses are presented by adding these expenses together in a line item called “other expenses”. With regards to internal financial statements, expenses are therefore presented with reference to the nature of the expense.

Internal financial statements furthermore have the characteristic that, besides the amounts as presented in the financial statements, limited additional information is disclosed in narrative notes. The reason for this is that internal financial statements are prepared for users that are familiar with the circumstances and activities of the entity. Financial statements prepared for internal purposes do not have much utility for external parties such as the bank or payables of the entity.

CONTINUED INTRO…Already at the beginning of the previous century, legislators recognised the importance of financial statements for users that are not involved in the management of a company, such as shareholders, banks, payables and the government of a country. In the RSA, the Companies Act of 1926 contained stipulations regarding so-called published financial statements which, besides being published in the press, had to be filed with the registrar of companies. The published financial statements also had to be available to shareholders. The government, banks and payable usually insisted on a copy of the statements. The contents of these statements were, to a large extent, regulated by the Fourth schedule of the Companies Act.

THE COMPANIES ACT (71 OF 2008)

Accounting records

The company must keep accurate and complete accounting records at or accessible from the registered office in at least one of the official languages to enable the proper compilation of financial statements and to conduct an audit or review as required by the Act

The prescribed records should include records of all assets and liabilities, loans to directors, prescribed officers and employees, liabilities and obligations, property held in fiduciary capacity, revenue and expenses, and stock.

FINANCIAL STATEMENTS be prepared within six months of the year-end; be prepared according to the applicable accounting

standards fairly present the state of affairs and business of the

company, and explain the transactions and financial position;

show the assets, liabilities and equity, as well as the company's income and expenses;

disclose the date on which the statements were approved, as well as the accounting period;

on the first page state whether it is audited, reviewed or not audited or reviewed;

include an auditor’s report if the statements are audited

FINANCIAL STATEMENTS CONT… include a report by the directors with respect to the state

of affairs, the business and profit or loss of the company, including:

any matter material for the shareholders to appreciate the company’s state of affairs; and

any prescribed information;

be approved by the board of directors and signed by an authorised director; and

be presented to the first shareholders’ meeting after the statements have been approved by the board.

Financial statements may not be false, misleading or incomplete, and any person who is a party to the preparation, approval, dissemination or publication of such statements thereof is guilty of an offence. (Sections 29 and 30)

PUBLIC INTEREST SCORE The public interest score is an indication of the extent of

the public interest in a company. The extent of the public interest score of a private company determines the reporting standards applicable to the company as well as whether the private company’s financial statements are subject to an audit or an audit review.

The public interest score is calculated by awarding 1 mark for each of the following:

Every R1 million turnover; Every employee (average number); Every security holder; and Every R1 million third party obligation (Regulation 26).

REPORTING STANDARDS FOR PUBLIC- AND PRIVATE COMPANIES

The following summary shows the financial reporting standards that should be applied in terms of the Companies Act, 2008 by public- and private companies to all financial years commencing on or after 1 May 2011 (Regulation26)

Public companies listed on an exchange

IFRS

Public companies not listed on anexchange

One of• IFRS; or• IFRS for SMEs, provided that companymeets scoping requirements outlined inthe IFRS for SMEs

Private companies whose public interestscore for the particular financial year is atleast 350 OR who holds assets in excessof R5 million in a fiduciary capacity

One of –• IFRS; or• IFRS for SMEs, provided that companymeets scoping requirements outlined inthe IFRS for SMEs

Private companies whose public interestscore for the particular financial year is atleast 100, but less than 350

One of –• IFRS; or• IFRS for SMEs, provided that companymeets scoping requirements outlined inthe IFRS for SMEs

Private companies whose public interestscore for the particular financial year isless than 100, and whose statements areindependently compiled

One of –• IFRS; or• IFRS for SMEs, provided that companymeets scoping requirements outlined inthe IFRS for SMEs

Private companies whose public interestscore for the particular financial year isless than 100, and whose statements areinternally compiled

The financial reporting standard asdetermined by the company

CATEGORIES OF COMPANIES THAT MUST BE AUDITED The following companies’ financial statements are

subject to an audit (Regulation 28): Public company; Private company who holds assets in excess of R5

million in a fiduciary capacity; Private company with a public interest score of 350

or more; Private company with a public interest score of at

least 100, but less than 350 and of which the financial statements are compiled internally; and

Private company that voluntarily decides that the financial statements are subject to an audit.

GENERAL PURPOSE FINANCIAL STATEMENTS IAS 1 Presentation of Financial

Statements sets out overall requirements for the presentation of financial statements, guidelines for their structure and minimum requirements for their content.

THE COMPONENTS OF GENERAL PURPOSE FINANCIAL STATEMENTS A complete set of financial statements

comprises: a statement of profit or loss for the reporting

period; a statement of changes in equity for the

reporting period; a statement of financial position as at the

reporting date; a statement of cash flows for the reporting

period; and notes comprising a summary of the significant

accounting policies and other explanatory information.

THE OBJECTIVE OF GENERAL PURPOSE FINANCIAL STATEMENTS Financial statements are a structured exposition of

the financial position and the financial performance of the reporting entity. The objective of general purpose financial statements is to provide financial information about the financial position, the financial performance and the cash flow of the reporting entity, which is useful to a wide range of users in making economic decisions. Financial statements also reflect the result of the stewardship of an entity's management over the resources entrusted to them. To achieve this objective, financial statements provide information about the reporting entity’s assets, liabilities, equity, income, expenses and cash flow.(IAS 1.09)

THE OBJECTIVE OF GENERAL PURPOSE FINANCIAL STATEMENTS CONT…To achieve this objective, financial statements should have: general; as well as qualitative characteristics and should furthermore

comply with the stipulations of IFRS. and should furthermore comply with the stipulations of IFRS. To ensure fair presentation, financial statements should have qualitative characteristics that influence the quality of the financial statements, but also general features. There is some overlapping between the general features and qualitative characteristics

QUALITATIVE CHARACTERISTICS OF GENERAL PURPOSE FINANCIAL STATEMENTSSubsequently, attention is paid on an introductory basis to the characteristics that financial information should dispose of to be useful.For financial information to be useful it should have the fundamental qualitative characteristics of financial information, namely that it must be relevant and a faithful representation of what it purports to represent. Apart from the fundamental qualitative characteristics of financial information, the enhancing qualitative characteristics of financial information, which enhances the usefulness of information that is relevant and faithfully represented, are distinguished. The following enhancing qualitative characteristics are distinguished, namely comparability, verifiability, timeliness and understand ability

GENERAL FEATURES OF GENERAL PURPOSE FINANCIAL STATEMENTSFair presentation and compliance with IFRSs

Financial statements must fairly/faithfully present the financial position, financial performance and cash flows of an entity. This requires the faithful representation of the effects of transactions, other events and conditions in accordance with the definitions and recognition criteria for assets, liabilities, income and expenses, as set out in the Framework 2010. The application of IFRSs, with additional disclosure, when necessary, is presumed to result in financial statements that achieve a fair/faithful presentation. (IAS 1.15)

GOING CONCERN

The reporting entity normally prepares financial statements on the assumption that the entity is a going concern and will therefore continue in operation for the foreseeable future.

ACCRUAL BASIS OF ACCOUNTING In order to achieve the set objectives, the statement of profit or

loss, the statement of changes in equity and the statement of financial position are prepared from accounting records in which the effect of transactions and events are accumulated in accordance with accrual accounting, where applicable.

In accordance with accrual accounting, the effect of transactions and events are recognised in the period in which it occurs, even if the resulting cash inflow and cash outflow occurs in a different period. (Framework 2010, OB17) Or stated differently, in accordance with the accrual basis of accounting, items are recognised as assets, liabilities, equity, income and expenses (that is the elements of financial statements) when the items satisfy the definition and recognition criteria of that element. (IAS 1.28) The practical implication of accrual accounting is that the purchase of an asset on credit, the receipt of a loan, the sale of trade inventories on credit, the incurrence of an expense on credit and the subsequent settlement of the debt, are separate transactions.

MATERIALITY AND AGGREGATION The concept of materiality and

aggregation has limited application and mainly plays a role in the decision regarding which information should be disclosed in a note in respect of the expenses aggregated and presented per function.(IAS 1.29 and 1.30).

OFFSETTINGIncome and expense may not be offset (against each other) if it relates to income and expenses from normal operating activities, for example sales and cost of sales a represented separately in the statement of profit or loss. Offsetting is on the other hand allowed in respect of the sale of a non-current asset such as a vehicle. In the case of the sale of an old delivery vehicle by an entity, the carrying amount of the vehicle sold is subtracted from the proceeds with the sale of the vehicle in order to calculate the profit or loss on the sale of the vehicle and consequently to present and disclose the profit or loss. If two PPE items of the same category (e.g.. vehicles) were sold, one at a profit and the other at a loss, the profit and loss will be offset and be disclosed as a net profit or loss on the disposal of the PPE item(vehicles). In this case, the profit or loss on the disposal of PPE items of different categories (e.g. vehicles and equipment) will be disclosed separately. The presentation of trade receivables after the allowance for doubtful debts was offset, does not representoffsetting. (IAS 1.32 and .33)

AN ENTITY MUST PRESENT A COMPLETE SET OF FINANCIAL

STATEMENTS AT LEAST ANNUALLY.

Frequency of reporting

COMPARATIVE INFORMATION In respect of all amounts in the current

year’s financial statements, comparative amounts of the previous period must be presented. (IAS 1.38)

STRUCTURE AND CONTENTStatement of profit or loss

Fair value adjustment of listed shares are recognised and presented as income.

With reference to the framework of the statement of profit or loss, attention is paid to a few aspects of the presentation and disclosure of income.

In this case the first line item in the statement of profit or loss, namely revenue, includes only income from the sale of merchandise, net of returns (in), discounts and value added tax.

There is an accounting policy note in respect of the recognition of income from sales (note3.10 of the framework), as well as a note to the line item “Revenue” (note 5 of the framework)in the statement of profit or loss, which states the fact that revenue comprises only income from the sale of merchandise.

STATEMENT OF PROFIT AND LOSS CONT.Income items, other than income from the sale of merchandise, are presented in the following three line items in the statement of profit or loss: Other incomeThis line item includes items such as: Profit on the disposal of PPE items (per PPE category) or Trademarks Insurance claim proceeds in respect of a PPE item destroyed in an incident; Profits arising from changes in the fair value of investments in listed shares or

investment property and Rent income from investment property Detail in respect of the abovementioned items are disclosed in a note to the statementof profit or loss, called “Profit before tax”. Income from subsidiaryThis line item includes income such as dividends and management fees received from asubsidiary . Income from financial investmentsThis line item includes interest received on a fixed term deposit as well as dividends received in respect of investments in listed or unlisted shares of companies, which are not subsidiaries.With reference to the framework of the statement of profit or loss, attention is paid to a few aspects of the presentation and disclosure of expenses.

STATEMENT OF PROFIT AND LOSS CONT.Cost of sales is presented as a separate line item Expenses may be presented in the statement of profit or loss by using a

classification that relates to the nature of the expenses or to a classification that relates to the functions within the entity in respect of which the expenses are incurred. In this work, expenses in the case of companies are presented in the statement of profit or loss according to the function thereof.

When expenses are presented according to the nature thereof, line items such as employee benefits expense, water and electricity, transport costs, insurance, etc. are used. This presentation is generally found with financial statements which are prepared for internal purposes (IAS 1.102) or with financial statements that are prepared for a sole trader.

In this case , expenses in the case of companies are presented in accordance with the function it relates to. The following three line items are used to present expenses, other thancost of sales, finance costs and income tax expense:

Distribution costs; Administrative expenses; and Other expenses. (IAS 1.103)

STATEMENT OF PROFIT AND LOSS CONT.

At the end of the reporting period, expense accounts are closed off against retained earnings. In the case of the presentation of expenses according to the function thereof, the accounting system would be set up in such a way that the expenses are automatically allocated to the function it relates to.

The “Profit before tax” note must inter alia disclose the following expenses: Depreciation – per category of property, plant and equipment (IAS 1.104); Amortisation – trademarks (IAS 1.104); Impairment loss – property, plant and equipment (IAS 36); Impairment loss – trademarks (IAS 36); Employee benefit expense (IAS 1.104); Settlement of law suits (IAS 1.98); Management-, technical-, administrative- and secretarial services (to non-

employees)(IAS 1.104); Auditors’ remuneration (according to tradition); Directors’ remuneration (Section 69); Loss on disposal of PPE items (per PPE category) and Intangible assets (per

category)(IAS 1.104); Loss on PPE items destroyed in an incident (IAS 1.104); Operating lease (IAS 17); and Losses arising from changes in the fair value of investments in listed shares or investment property

STATEMENT OF CHANGES IN EQUITYStatement of financial position The statement of financial position indicates the financial

state/position of the entity at a specific date, usually the reporting date. The statement of financial position deals with the assets, liabilities and equity of an entity in a specific format.

Assets consist of various items and are presented in the statement of financial position under two classification headings, namely non-current assets and current assets. (IAS 1.66)

Non-current assets are defined as all assets that are not current assets. (IAS 1.66)

An entity will classify an asset as a current asset if: the asset is primarily held for the purposes of trading, with the

expectation to sell or use the asset within the normal operating cycle (e.g. trade inventories and trade receivables); or

the asset will realise into cash within twelve months from the current reporting date (e.g. term deposit); or

the asset is cash or cash equivalents. (IAS 1.66)

STATEMENT OF FINANCIAL POSITION CONT.

Liabilities consist of various liability-items and are presented in the statement of financial position under two classification headings, namely non-current liabilities and current liabilities.

Non-current liabilities are defined as all liabilities that are not current liabilities.

An entity will classify a liability as a current liability if: it is the expectation to settle the liability in cash within

the normal operating cycle (e.g. other payables); or the liability is primarily held for trading (e.g. trade

payables); or the liability has a settlement date that falls within twelve

months from the current reporting date (e.g. a bank loan)

FINANCIAL STATEMENTS: FRAMEWORK FOR PRESENTATION AND DISCLOSUREThe framework for the presentation and disclosure in respect of financial statements are preparedwith reference to IFRS and is applicable to private- and publiccompanies.

NOTES TO THE FINANCIAL STATEMENTS1.COMPLIANCE WITH IFRS (IAS 1.16)The financial statements have been prepared in accordance with the International Financial Reporting Standards (IFRSs) as issued by the International Accounting Standards Board(IASB).2.MEASUREMENT BASES (IAS 1.117)The financial statements have been prepared in accordance with the historical-cost basis, with the exception of investment property as well as financial investments which are shown at fair value and inventories which are shown at the lower of cost and net realisable value.

3.ACCOUNTING POLICY3.1 Property, plant and equipment

Items of property, plant and equipment are measured at cost less accumulated depreciation and less accumulated impairment losses.

Depreciation is charged so as to allocate the cost of assets less their estimated residual values over their estimated useful lives to an expense. The following depreciation methods and annual rates (where applicable) are used to depreciate property, plant and equipment:Land no depreciation is written off on landBuildings 2% per year on the straight line methodMachinery 20% per year on the straight line methodVehicles 32% per year on the diminishing balance method

If there is an indication that there has been a significant change in the useful life, residual value or of the utilisation pattern of assets, the depreciation is revised prospectively to reflectthe new estimates.

Impairment of assetsAt each reporting date, property, plant and equipment are reviewed to determine whetherthere is any indication that those assets have suffered an impairment loss. If there is anindication of possible impairment, the recoverable amount of any affected asset is estimatedand compared with its carrying amount. If the estimated recoverable amount is lower, thecarrying amount is reduced to its estimated recoverable amount, and an impairment loss isrecognised immediately.

3.2 Investment property

Investment property is property held to earn rentals and/or for capital appreciation (including property under construction for such purposes).Investment property is initially measured at its cost, including transaction costs. Subsequent to initial recognition, investment property is measured at fair value. Profits and losses arising from changes in the fair value of investment property are included in profit or loss in the period in which they arise.3.3 Intangible assets

Purchased intangible assets are measured at cost less accumulated amortisation (and accumulated impairment losses). Amortisation is charged so as to allocate the cost of the intangible assets over their estimated useful lives to an expense. Intangible assets are amortised on the straight line method at the following rates:Trademarks xx%Patents xx%

3.4 Investment in subsidiaryInvestment in subsidiary is measured at cost price less accumulated impairment

3.5 Financial investments3.5.1 Listed shares

Investments in listed shares are initially recognised at cost price (excluding any transaction costs). Subsequent to initial recognition, investments in listed shares are measured at fair value. Profits and losses arising from changes in the fair value of investments in listed shares are included in profit or loss in the period in which they arise3.5.2 Unlisted shares

Investments in unlisted shares are initially recognised at cost price (including transaction costs). Subsequent to initial recognition, investments in unlisted shares are measured at cost price less accumulated impairment (if applicable).3.6 Inventories

Trade inventories are measured at the lower of cost and net realisable value. Cost is calculated by using the FIFO cost formula (or the weighted average cost formula, if applicable).

3.7 Financial assetsTerm deposits are initially recognised at cost price. Subsequent measurement occurs at amortised cost by applying the effective interest rate method.

3.8 Long term borrowingsLoans are measured at amortised cost by using the effective interest rate method. The interest expense is recognised on the basis of the effective interest rate method and is included in finance costs3.9a Finance leases

Assets held in accordance with finance lease agreements are capitalised. Depreciation is written off on these assets at rates deemed appropriate to write the assets off over the leaseterm. A finance lease liability is recognised with inception of the lease and is reduced with the capital portion of each instalment.The finance lease costs are recognised over the term of the lease in accordance with the effective interest rate method.3.9b Operating leases

Operating lease payments are recognised as an expense against profit or loss over the term of the relevant lease on a straight line basis.

3.10 Recognition of revenue and other incomeRevenue is measured at the fair value of the consideration received or receivable, excluding discounts, rebates and value added tax. Income from the sale of goods is recognised when the significant risks and rewards associated with ownership of the goods have passed to the buyer. Dividends are recognised according to the accrual basis of accounting when the dividends are declared. Royalties are recognised in accordance with the accrual basis and taking into account the stipulations of the agreement.5 RevenueRevenue comprises: R Net sales of merchandise xxx6 Cost of salesIncluded in cost of sales are: RLoss with write-off of specific inventory items to net realisable value xxxWrite-off of inventory shortages in respect of certain inventory items xxxLoss due to inventories destroyed in an incident xxxInsurance claim proceeds in respect of inventories destroyed in an incident xxx

7 Income from subsidiary RDividends xxxManagement fee xxx xxx8 Income from financial investments RListedDividends xxx

UnlistedDividends xxxInterest xxx xxxTotal income from financial investments xxx

9 Finance costsFinance costs comprise: RFinance costs on bank overdraft xxxFinance costs on bank loans xxxFinance costs on suppliers’ loans xxxFinance costs on mortgage bond xxxFinance costs on finance lease xxxFinance costs on specific loan xxx xxxInterest income on unutilised funds from specific loan (xxx)Interest capitalised against asset under construction (xxx) xxx

10 Profit before taxProfit before tax is shown after inter alia the following items, which are items additional to the income and expenses presented as separate line items, had been taken into account:

INCOME

. .

Income RProfit on disposal of PPE items xxxInsurance claim proceeds in respect of a PPE item destroyed in an incident xxxProfit on disposal of intangible assets xxxProfit with the fair value adjustment of investments in listed shares xxxProfit on the disposal of investments in unlisted shares xxx Profit with the fair value adjustment of investment property xxxRent income from investment property xxx

EXPENSES R Depreciation – per category of property, plant and equipment xxx Amortisation – trademarks xxx Impairment loss – property, plant and equipment xxx Impairment loss – intangible assets xxx Impairment loss – unlisted shares xxx Employee benefit expense xxx Settlement of law suits xxx Management-, technical-, administrative- and secretarial services (to non-employees) xxx Auditors’ remuneration xxx For audit/audit review xxx Other services (specify the service) xxx Expenses (no need to specify) xxx Directors’ remunerationExecutive directors xxx Emoluments xxxNon-executive directors xxx Emoluments xxx Loss on disposal of PPE items (per PPE category) xxx Loss on PPE items destroyed in an incident xxx Loss on disposal of intangible assets (per category) xxx Operating lease – state the type of asset (eg. vehicles/buildings) xxx Loss with the fair value adjustment of investments in listed shares xxx Loss on the disposal of investments in unlisted shares xxx Loss with the fair value adjustment of investment property xxx

11 Income tax expense RCurrent tax xxx

12 Earnings per shareThe calculation of earnings per share is based on earnings of Rxxx and on a weighted average number of ordinary issued shares of xxx.14 Investment property RAt fair valueBalance at beginning of the year xxxAdditions at cost xxxInvestment property under construction at cost xxxDisposals at fair value (xxx)Profit/(loss) on fair value adjustment xxxBalance at end of the year xxx

16 Investment in subsidiary Rxxx (yy%) Ordinary shares in ABC Ltd at cost price xxxLess: accumulated impairment (if applicable) (xxx) xxx

17 Financial investmentsListed at fair value Rxxx (yy%) Ordinary shares in XYZ Ltd xxxUnlisted at cost pricexxx (yy%) Ordinary shares in FGH Ltd xxxLess: Accumulated impairment (if applicable) (xxx) xxxTotal financial investments xxx

18 InventoriesInventories comprise: RMerchandise xxxConsumables xxx xxxInventories are pledged as security for the bank loan to the

19 Trade receivables RTrade receivables xxxLess: allowance for doubtful debts (xxx) xxxThe allowance for doubtful debts was increased with Rxxx during the course of the year.

20 Share capitalAuthorisedxxx Ordinary sharesxxx y% Preference shares

Issuedxxx Ordinary shares xxxxxx y% Preference shares xxx xxx

Number of shares y% preference Ordinary shares shares Reconciliation of number of shares issuedIssued at the beginning of the reporting period xxx xxxIssued during the reporting period xxx xxxIssued at the end of the reporting period xxx xxx

21 Long term borrowingsDetail of long term borrowings are as follows:Secured RMortgage bond xxxProperty with a carrying amount of Rxxx is pledged as security for the mortgagebond.The interest rate is xx% per year and the loan is repayable in xxx equal annualinstalments of Rxxx each as from xxx 20.11Less: portion payable within 12 months transferred to current liabilities (xxx) xxx

Bank loan xxxInventories with a cost price of Rxxx are pledged as security for the bank loan.The interest rate is xx% per year and the loan is repayable in xxx equal annualinstalments of Rxxx each as from xxx 20.10.Less: portion payable within 12 months transferred to current liabilities

(xxx) xxx

Supplier’s loan xxxA plant item with carrying amount of Rxxx is pledged as security for the supplier’sloan.The interest rate is xx% per year and the loan as well as the interest is repayablein one amount on xxx 20.10ORThe interest rate is xx% per year and the loan is repayable in xxx equal annualinstalments of Rxxx each as from xxx 20.10Less: portion payable within 12 months transferred to current liabilities (xxx) xxx

Finance lease loan xxxA vehicle with a carrying amount of Rxxx is pledged as security for the financelease loan.The loan incurs interest at xx% per year and is repayable in xxx equal annualinstalments of Rxxx each from xxx 20.7.Ownership of the asset transfers to the entity after payment of the last instalment.Less: portion payable within 12 months transferred to current liabilities (xxx) xxxUnsecuredShareholders loan account xxxThe interest rate is xx% per year and the loan has no fixed repayment conditions. xxx

22 Short term provisions RBalance at the beginning of the year xxxAdditional provision xxxBalance at the end of the year xxxThe provision was created in respect of a claim by the local authority for alleged environmental pollution. The case will probably be adjudicated by the court during the second half of 20.11. The court ruling may also have an influence on the possible amount payable.

23 Contractual liabilityA contractual liability exists in respect of plant under construction to the amount of Rxxx.

24 Contingent liabilityA claim was instituted against the company for alleged damage caused by an allegeddefective product. It is unlikely that a future expense will be incurred in this regard.(Note: An entity should compile this note in consultation with its legal representatives.)

25 Change in estimateDuring the year, the estimated remaining useful life of (the asset) was extended from xx years to xx years. The effect of the change in estimate was to increase/reduce the depreciationexpense with Rxxx.ORDuring the year the estimated residual value of (the asset) of Rxxx changed to Rxxx. The effect of the change in estimate was to increase/decrease the depreciation expense withRxxx.ORFrom the beginning of 20.x, the depreciation method of (the asset) changed from the xxx method to the xxx method. The effect of the change in the depreciation method was to increase/decrease the depreciation expense with Rxxx.

26 Future minimum operating lease payments RPayable within a year xxxPayable after one year, but within xxx (should be <5) years xxxPayable after five years xxx xxx

SOURCESCompanies Act (71 of 2008)Marx, Van der Watt and Bourne (2012) Dynamic Auditing, Chapter 2, Tenth Edition (DurbanLexisNexis)Delport P (2011) The new Companies Act Manual Including Close Corporations and Partnerships,Second Edition (Durban LexisNexis