8/12/2019 Legislative Policies - Financial Statements - Notes on Financial Statements - GAAP

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Notes on financial statements

1. Accounting Policies

1.1. Borrowing cost

Borrowing costs incurred in respect of qualifying assets are capitalized. This represents a change in accountingpolicy. Refer to note 4.

1.3. Revenue

Revenue fro sale of goods consists of wholesale and retail sales to custoers e!cluding value"added ta!ation

and urgency coissions and is recognized when the significant ris#s and rewards of ownership have passed t

the $uyer. Revenue fro the rendering of services is recognized with reference to the stage of copletion at th$alance sheet date% $ased on costs incurred to date in relation to total estiated costs% and royalty revenue is

recognized on an accrual $asis according to the underlying royalty agreeent.

&. Revenue coprises'

(ale of goods !!!!!!!

(ervices rendered !!!!!!Royalties !!!!!

)ncluded in sales of goods is an aount of R*** that arose fro the e!change of goods for repairs done.

3. )ncoe Ta! e!pense

(A noral ta!ation" current !!!!!

" deferred !!!!!

(econdary Ta! on copanies !!!

Tax rate reconciliationAccounting profit !!!!Ta! + 3,- !!!!

Ta!ation affects of'

on"ta!a$le incoe /!!!!0

(econdary Ta! on opanies !!!!

* 2ividends received /!!! 3,-0

4. (econdary ta! on copanies

(T is paya$le at a rate of 1&% - on the distri$ution of profits. The potential (T on possi$le future distri$utions

e!isting reserves aounts to R!!!.

4. hange in accounting policy

The copany has changed its accounting policy in respect $orrowing costs. 5here $orrowing costs on qualifyingassets were previously recognized as an e!pense% it is now capitalized. This was done to give a fairer account of

total acquisition cost attri$uta$le to qualifying assets. The change in policy has $een accounted for retrospectivel

and coparative figures have $een appropriately restated. The effect of the change in accounting policy is asfollows'

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8/12/2019 Legislative Policies - Financial Statements - Notes on Financial Statements - GAAP

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&,6 &, R R

2ecrease in finance charges !!!!! !!!!!)ncrease in ta! e!pense /!!!0 /!!!0

""""""""""" """"""""""""

)ncrease in profit 7777777 77777777

)ncrease in property% plant and equipent !!!!! !!!!!

2ecrease in deferred ta! asset /!!!0 /!!!0)ncrease in equity !!!!! !!!!!

Ad8ustent against retained earnings at the $eginning of &, !!!!!

)ncrease in earnings per share /!!!! 9 !!!!0: /!!!!9 !!!!0 !!! !!!!!

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