Contents
NOTES TO THE
ANNUAL FINANCIAL STATEMENTS
for the year ended 30 September 2006
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Commentary
Directors’ responsibility
Secretaries’ certification
Report of the independent auditors
Directors’ report
Accounting policies
Income statements
Balance sheets
Cash flow statements
Notes to the cash flow statements
Statements of changes
in equity
Notes to the annual financial statements
Principal subsidiaries
Share ownership analysis
Shareholders’ diary
Corporate administration and information
Currency conversion table
Notice of annual general meeting - PDF 106kb
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    GROUP   COMPANY
    2006 
Rm 
 
2005 
Rm 
(Restated)
  2006 
Rm 
 
2005 
Rm 
(Restated)
2. OPERATING PROFIT IS STATED AFTER:          
  Administration, management and other fees 37,7  21,3    29,5  16,3 
  Auditors’ remuneration:          
  Audit fees 10,2  7,0    5,1  2,8 
  Other fees 2,5  1,7    1,6  0,7 
  Expenses 0,1  0,1    —  — 
    12,8  8,8    6,7  3,5 
  Depreciation:          
  Buildings 3,4  1,1    0,7  0,6 
  Plant and equipment 51,6  43,4    21,2  17,0 
  Vehicles 4,9  1,9    2,8  0,6 
    59,9  46,4    24,7  18,2 
  Amortisation:          
  Intangible assets  3,3  3,5    1,3   0,7 
  Impairments in respect of the group relating to buildings of Rnil (2005: R4,1 million), plant and equipment of Rnil (2005: R0,8 million), and goodwill
of R3,4 million (2005: Rnil) have been included in abnormal items (refer to note 5).
         
  Bad debt expense 12,5  11,2    2,4  — 
  Rental income from investment properties
(included in revenue)
(4,5) (3,4)   —  — 
  Direct operating expenses arising from investment properties that generated rental income   2,3  2,1    —  — 
  Direct operating expenses arising from investment properties that did not generate rental income 0,2  —    0,2  — 
  Net realised gains/(losses) on currency exchange differences 3,5  (37,1)   (4,6) (34,3)
  Net unrealised (losses)/gains on currency exchange differences —  19,0    (20,9) 18,7 
  Net realised gains on fair value adjustments to derivative instruments 62,1  (1,5)   14,3  (2,0)
  Net unrealised gains/(losses) on fair value adjustments to derivative instruments (refer note 34) 67,7  (16,4)   38,7  (11,9)
    133,3  (36,0)   27,5  (29,5)
  Income from subsidiaries:          
  Fees       5,7 4,3
  Rental (included in revenue)       6,9 7,0
          12,6 11,3
  Operating lease charges:          
  Land and buildings 26,3 31,0   12,4 14,9
  Vehicles and other 0,9 0,6   0,6 0,1
    27,2 31,6   13,0 15,0
  Research and development expenditure:          
  Financed by revenue from customers 17,4 32,8  
  Not financed by revenue from customers 43,9 40,3   35,0 30,9
    61,3 73,1   35,0 30,9
  Net surplus/(loss) on disposal of plant and equipment 2,6 (0,2)   (0,3) 0,1
  Staff costs:          
  Salaries and wages 852,0 741,0   138,3
  Pension fund contributions 7,8 9,3   0,5
  Provident fund contributions 52,9 45,9   8,2
  Other staff costs 44,7 60,5   23,1
    957,4 856,7   170,1
  Share-based payment expense in respect of the group’s share option scheme (refer to note 23). 9,6 6,7   9,6 6,7
  Equity instrument offered to Powerhouse Utilities (Pty) Limited (“Powerhouse”) to take up 25,1% of the A shares of ATC (Pty) Limited (“ATC”). 24,1      
  The group entered into an agreement with Powerhouse, whereby on 1 December 2004 25,1% of the A shares of ATC were transferred to Powerhouse at a cost of R130 million. IFRS requires the reversal of the sale since the purchase consideration has not been fully paid for by Powerhouse and conditions are attached to the unpaid portion, notwithstanding that the legal effect of this transaction is in fact a sale. The earnings attributable to Powerhouse are included in arriving at the earnings attributable to shareholders in Reunert Limited and an equity instrument of R24,1 million, which values the Black Economic Empowerment (BEE) deal in terms of IFRS 2, has been expensed in arriving at operating profit in the previous year. As and when dividends are paid to Powerhouse they will be treated as an appropriation of profits (refer to note 25).          
  Compensation of key management personnel          
  The remuneration paid to directors and other key management personnel of Reunert Limited during the year was as follows:          
  Short-term benefits 32,5 26,1   1,1 1,0
  Post-employment benefits 2,5 2,4      
  Share-based payments 18,0 8,0      
    53,0 36,5   1,1 1,0
  The remuneration of directors and key management personnel is determined by the remuneration committee having regard to the performance of individuals and market trends.          
   
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