Basic HTML Version
67
Accounting Policies
Annual Financial Statements for the 15 months ended 30 September 2011
1. Presentation of Annual Financial
Statements
The annual financial statements have been prepared in
accordance with International Financial Reporting Stan-
dards, and the Companies Act 71 of 2008. The annual
financial statements have been prepared on the histori-
cal cost basis, except for the measurement of certain
financial instruments at fair value, and incorporate the
principal accounting policies set out below.They are pre-
sented in South African Rands.
These accounting policies are consistent with the pre-
vious period, except for the changes set out in note 2
new standards and interpretations.
1.1 Consolidation
Basis of consolidation
The consolidated annual financial statements incorpo-
rate the annual financial statements of the company and
all entities, which are controlled by the company.
Control exists when the company has the power to gov-
ern the financial and operating policies of an entity so as
to obtain benefits from its activities.
The results of subsidiaries are included in the consolidat-
ed annual financial statements from the effective date of
acquisition to the effective date of disposal.
Adjustments are made when necessary to the annual fi-
nancial statements of subsidiaries to bring their account-
ing policies in line with those of the group.
All intra-group transactions, balances, income and ex-
penses are eliminated in full on consolidation.
Non-controlling interests in the net assets of consolidat-
ed subsidiaries are identified and recognised separately
from the group’s interest therein, and are recognised
within equity. of subsidiaries attributable to non-control-
ling interests are allocated to the non-controlling inter-
est even if this results in a debit balance being recog-
nised for non-controlling interest.
Transactions which result in changes in ownership lev-
els, where the group has control of the subsidiary both
before and after the transaction are regarded as equity
transactions and are recognised directly in the state-
ment of changes in equity.
The difference between the fair value of consideration
paid or received and the movement in non-controlling
interest for such transactions is recognised in equity at-
tributable to the owners of the parent.
Where a subsidiary is disposed of and a non-controlling
shareholding is retained, the remaining investment is
measured to fair value with the adjustment to fair value
recognised in profit or loss as part of the gain or loss on
disposal of the controlling interest.
Business combinations
The group accounts for business combinations using
the acquisition method of accounting. The cost of the
business combination is measured as the aggregate of
the fair values of assets given, liabilities incurred or as-
sumed and equity instruments issued.Costs directly at-
tributable to the business combination are expensed as
incurred, except the costs to issue debt which are amor-
tised as part of the effective interest and costs to issue
equity which are included in equity.
Contingent consideration is included in the cost of the
combination at fair value as at the date of acquisition.
Subsequent changes to the assets, liabilities or equity
which arise as a result of the contingent consideration
are not affected against goodwill, unless they are valid
measurement period adjustments.
The acquiree’s identifiable assets, liabilities and contin-
gent liabilities which meet the recognition conditions of
IFRS 3 Business Combinations are recognised at their fair
values at acquisition date, except for non-current assets