notes to the annual financial statements for the year ended 23 December 2012

11. Earnings per share

  December 2012
26 weeks
  June 2012
52 weeks
Per share (cents)       
Basic EPS  319.7    544.4 
Diluted basic EPS  315.4    532.7 
Headline EPS (cents)   326.0    564.5 
Headline EPS before Walmart costs and foreign exchange (taxed) (cents)  423.5    656.9 
Diluted headline EPS (cents)  321.7    552.3 
Diluted headline EPS before Walmart costs and foreign exchange (taxed) (cents)  417.9    642.7 
Ordinary shares (number)       
In issue  216,910,195    216,124,461 
Weighted average  216,413,814    215,539,458 
Diluted weighted average  219,312,755    220,284,100 

  December 2012
26 weeks
  June 2012
52 weeks
  Pre-
taxation
Rm
  Post-
taxation
Rm
  Cents/
share
  Pre-
taxation
Rm
  Post-
taxation
Rm
  Cents/
share
Attributable and headline earnings per share                      
The calculation of attributable and headline earnings per share is based on the weighted average number of ordinary shares.                      
The calculation is reconciled as follows:                      
Profit attributable to the equity holders of the parent     691.8   319.7       1,173.5   544.4
Adjustments after minorities:                      
Loss on disposal of tangible assets 6.2   4.2   1.9   12.6   8.9   4.1
Loss on disposal of business 4.4   3.8   1.8   12.1   9.9   4.6
Fair value adjustment on assets classified as held for sale 0.4   0.3   0.1   7.9   7.9   3.7
Impairment of assets 5.4   5.4   2.5   16.5   16.5   7.7
Headline earnings     705.5   326.0       1,216.7   564.5
Walmart costs 205.2   155.8   72.0   185.4   146.9   68.2
Foreign exchange loss 76.7   55.2   25.5   72.5   52.2   24.2
Headline earnings before Walmart costs and foreign exchange     916.5   423.5       1,415.8   656.9

  December 2012
26 weeks
Rm
  June 2012
52 weeks
Rm
  December 2012
26 weeks
Cents/share
  June 2012
52 weeks
Cents/share
Diluted attributable and diluted headline earnings per share               
The calculation of diluted attributable and diluted headline earnings per share is based on the weighted average number of ordinary shares.               
The calculation is reconciled as follows:               
Profit attributable to the equity holders of the parent  691.8    1,173.5    319.7    544.4 
Adjustment for impact of issuing ordinary shares  -        (4.3)   (11.7)
Diluted attributable earnings  691.8    1,173.5    315.4    532.7 
Headline earnings  705.5    1,216.7    326.0    564.5 
Adjustment for impact of issuing ordinary shares  -        (4.3)   (12.2)
Diluted headline earnings  705.5    1,216.7    321.7    552.3 
Diluted headline earnings before Walmart costs and foreign exchange  916.5    1,415.8    417.9    642.7 


Weighted average shares outstanding December 2012
No of shares
  June 2012
No of shares
Weighted average shares outstanding for basic and headline earnings per share 216,413,814   215,539,458
Potentially dilutive ordinary shares resulting from outstanding options  2,898,941   4,744,642
Weighted average shares outstanding for diluted and diluted headline earnings per share 219,312,755   220,284,100

  • Both the Thuthukani 'A' preference shares and the Black Scarce Skills 'B' preference shares are predominantly dilutive and have a small effect on diluted basic and diluted headline earnings per share.

12. Property, plant and equipment

  Cost
Rm
  Accumulated
depreciation and
impairment
Rm
  Net book value
Rm
December 2012           
Owned assets           
Freehold land and buildings  908.9    58.9    850.0 
Leasehold improvements  663.5    231.0    432.5 
Fixtures, fittings, plant and equipment  3,836.6    1,668.4    2,168.2 
Computer hardware  511.2    317.9    193.3 
Motor vehicles  210.6    76.1    134.5 
  6,130.8    2,352.3    3,778.5 
Capitalised leased assets           
Freehold land and buildings  49.5    16.1    33.4 
Fixtures, fittings, plant and equipment  38.4    8.3    30.1 
Computer hardware  25.2    13.2    12.0 
Motor vehicles  32.2    18.0    14.2 
  145.3    55.6    89.7 
Total  6,276.1    2,407.9    3,868.2 
June 2012           
Owned assets           
Freehold land and buildings  909.9    52.4    857.5 
Leasehold improvements  598.4    206.0    392.4 
Fixtures, fittings, plant and equipment  3,358.1    1,476.2    1,881.9 
Computer hardware  464.7    283.4    181.3 
Motor vehicles  166.7    62.1    104.6 
  5,497.8    2,080.1    3,417.7 
Capitalised leased assets           
Freehold land and buildings  49.5    15.1    34.4 
Fixtures, fittings, plant and equipment  39.7    7.2    32.5 
Computer hardware  27.5    11.4    16.1 
Motor vehicles  40.4    20.5    19.9 
  157.1    54.2    102.9 
Total  5,654.9    2,134.3    3,520.6 

  • Certain capitalised leased property, plant and equipment is encumbered as per note 23.

Reconciliation of property, plant and equipment

  Opening
net book
value
Rm
  Additions
Rm
  Additions
through
acqui-
sitions
Rm
  Disposals
Rm
  Depre-ciation
Rm
  Foreign
exchange
gain/(loss)
Rm
  Reclas-sifications
Rm
  Impair-ment
Rm
  Classified
as held
for sale
Rm
  Closing
net book
value
Rm
December 2012                                       
Owned assets                                       
Freehold land and buildings  857.5    20.7    -      (0.2)   (6.5)   (0.7)   (20.8)   -      -      850.0 
Leasehold improvements  392.4    56.4    -      (1.1)   (26.7)   (3.3)   20.8    (5.4)   (0.6)   432.5 
Fixtures, fittings, plant and equipment  1,881.9    487.3    7.7    (7.0)   (202.2)   0.7    -      -      (0.2)   2,168.2 
Computer hardware  181.3    55.1    -      (4.7)   (38.4)   -      -      -      -      193.3 
Motor vehicles  104.6    43.4    -      (1.6)   (15.5)   (0.9)   4.5    -      -      134.5 
  3,417.7    662.9    7.7    (14.6)   (289.3)   (4.2)   4.5    (5.4)   (0.8)   3,778.5 
Capitalised leased assets                                       
Freehold land and buildings  34.4    -      -      -      (1.0)       -      -      -      33.4 
Fixtures, fittings, plant and equipment  32.5    -      -      -      (2.4)       -      -      -      30.1 
Computer hardware  16.1    -      -      -      (4.1)       -      -      -      12.0 
Motor vehicles  19.9    3.9    -      (0.2)   (4.9)       (4.5)   -      -      14.2 
  102.9    3.9    -      (0.2)   (12.4)   -      (4.5)   -      -      89.7 
Total  3,520.6    666.8    7.7    (14.8)   (301.7)   (4.2)   -      (5.4)   (0.8)   3,868.2 
June 2012                                       
Owned assets                                       
Freehold land and buildings  751.2    122.7    -      (4.6)   (11.3)   (0.5)   -      -      -      857.5 
Leasehold improvements  303.7    126.1    -      (4.1)   (45.5)   13.8    -      -      (1.6)   392.4 
Fixtures, fittings, plant and equipment  1,407.3    796.1    41.5    (13.6)   (348.8)   2.1    1.3    -      (4.0)   1,881.9 
Computer hardware  131.8    117.7    1.7    (1.0)   (68.5)   0.4    -      -      (0.8)   181.3 
Motor vehicles  61.9    47.8    22.0    (1.7)   (24.7)   0.7    0.8    -      (2.2)   104.6 
  2,655.9    1,210.4    65.2    (25.0)   (498.8)   16.5    2.1    -      (8.6)   3,417.7 
Capitalised leased assets                                       
Freehold land and buildings  36.3    -      -      -      (1.9)   -      -      -      -      34.4 
Fixtures, fittings, plant and equipment  4.9    -      34.5    (0.6)   (5.0)   -      (1.3)   -      -      32.5 
Computer hardware  8.3    13.0    2.5    -      (7.7)   -      -      -      -      16.1 
Motor vehicles  12.4    13.4    4.7    (0.8)   (9.0)   -      (0.8)   -      -      19.9 
  61.9    26.4    41.7    (1.4)   (23.6)   -      (2.1)   -      -      102.9 
Total  2,717.8    1,236.8    106.9    (26.4)   (522.4)   16.5    -      -      (8.6)   3,520.6 

  • The Group has reviewed the residual values and useful lives of the assets. No material adjustment resulted from such review in the current period.
  • The impairment of assets in the current year relates to the impairment of leasehold improvements in Masscash.
  • The following useful lives are used in the calculation of depreciation.
         - Buildings 50 years
         - Fixtures, fittings, plant and equipment 4 to 15 years
         - Motor vehicles 4 to 10 years
         - Computer hardware 3 to 8 years
         - Leasehold improvements Shorter of lease period or useful life
  • There is no investment property in the Group and all assets are held at historical cost.

13. Goodwill

  December 2012
Rm
  June 2012
Rm
Reconciliation of goodwill:       
Balance at the beginning of the year  2,521.4    2,049.4 
Additions through acquisitions  38.4    486.4 
Impairment    (16.5)
Disposal  (2.0)  
Transferred to assets classified as held for sale  (0.7)  
Foreign exchange gain/(loss) 0.6    2.1 
Balance at the end of the year  2,557.7    2,521.4 
Carrying amount of significant goodwill:       
Masscash Holdings (Pty) Ltd  1,122.9    1,090.7 
Builders Trade Depot (a division of Massbuild (Pty) Ltd) 900.9    901.1 
Fruitspot  168.2    163.9 
Rhino Cash and Carry Group  321.3    321.3 

  • Goodwill acquired in a business combination is allocated, at acquisition, to the cash generating units (CGUs) that are expected to benefit from that business combination.
  • The Group tests goodwill annually for impairment, or more frequently if there are indications that goodwill might be impaired.
  • When testing goodwill for impairment, the recoverable amounts of the CGUs are determined as the lower of value in use and fair value less costs to sell. The key assumptions for the value in use calculations are discount rates, growth rates and expected changes to selling prices and direct costs during the period. Management estimates discount rates using rates that reflect current market assumptions of the time value of money and the risks specific to the CGUs. The growth rates are based on industry growth forecasts. Changes in selling prices and direct costs are based on past practices and expectations of future changes in the market.
  • The Group prepares cash flow forecasts based on the CGUs' results for the next five years. A terminal value is calculated based on a conservative growth rate of 3% (June 2012: 3%). This rate does not exceed the average long-term growth rate for the relevant markets. The valuation method applied is consistent with the prior period.
  • The rate used to discount the forecast cash flows is 10.5% (June 2012: 10.5%).
  • The impairment of goodwill in the prior year relates to the impairment of certain acquired goodwill in Masscash.
  • In December 2012 the additions through acquisitions relate to the purchase of business assets in Masscash (Pty) Ltd T/A Upington Cash and Carry, Masscash (Pty) Ltd T/A Super Bloemfontein Cash and Carry, Masscash (Pty) Ltd T/A Kimberly Cash and Carry, Masscash (Pty) Ltd T/A Sydenham Liquors Cash and Carry and Cambridge Food (Pty) Ltd T/A Temba. Further details relating to these acquisitions can be found in note 3.
  • The majority of additions through acquisitions in June 2012 relate primarily to the purchase of Rhino Cash and Carry Group and Fruitspot. Further details relating to these acquisitions can be found in note 3.
  • During the prior year the Massbuild division completed a S45 transaction resulting in all the assets and liabilities being recorded in one entity, namely Builders Trade Depot. Goodwill illustrated above includes the goodwill for the whole division.

14. Other intangibles

  Cost
Rm
  Accumulated
amortisation and
impairment
Rm
  Net book
value
Rm
December 2012           
Owned assets           
Computer software  653.4    306.1    347.3 
Right of use  46.9    7.9    39.0 
Trademarks  4.3    3.0    1.3 
Total  704.6    317.0    387.6 
June 2012           
Owned assets           
Computer software  572.9    268.6    304.3 
Right of use  46.8    5.5    41.3 
Trademarks  4.4    2.9    1.5 
Total  624.1    277.0    347.1 

Reconciliation of other intangible assets

  Opening
net book
value
Rm
  Additions
Rm
  Additions
through
acquisitions
Rm
  Disposals
Rm
  Amortisation
Rm
  Foreign
exchange
gain
Rm
  Classified
as held
for sale
Rm
  Closing
net book
value
Rm
December 2012                               
Owned assets                               
Computer software  304.3    80.9        (37.9)       347.3 
Right of use  41.3    2.4        (2.8)   (0.8)   (1.1)   39.0 
Trademarks  1.5          (0.2)       1.3 
Total  347.1    83.3        (40.9)   (0.8)   (1.1)   387.6 
June 2012                               
Owned assets                               
Computer software  271.2    101.7      (0.3)   (68.3)   0.4    (0.4)   304.3 
Right of use  35.9    9.0    0.1      (3.7)       41.3 
Trademarks  1.9          (0.4)       1.5 
Total  309.0    110.7    0.1    (0.3)   (72.4)   0.4    (0.4)   347.1 

  • The Group has reviewed the useful lives of the assets for reasonability. There were no material adjustments in the current period.
  • The following useful lives are used in the calculation of amortisation:
    ~ Computer software 3 to 8 years
    ~ Right of use 10 years
    ~ Trademarks 10 years

15. Investments

  December 2012
Rm
  June 2012
Rm

Unlisted investments 

     
Fair value through profit or loss (FVTPL)       
Held for trading       
Bare dominium revaluation  110.0    82.0 
Investment in a trading and logistics structure  104.0    177.2 
Total financial assets classified as held for trading  214.0    259.2 
Designated as at FVTPL       
Participation in insurance cell-captive on extended warranties  -      18.8 
Participation in insurance cell-captive on premium contributions  34.8    35.1 
Total financial assets designated as at FVTPL  34.8    53.9 
Total fair value through profit or loss (FVTPL)  248.8    313.1 
Loans and receivables       
Trencor export partnership  2.5    3.0 
Total loans and receivables  2.5    3.0 
Held-to-maturity investments carried at amortised cost       
Other investments  0.1    0.1 
Total held-to-maturity investments  0.1    0.1 
Total unlisted investments  251.4    316.2 

Listed investments 

     
Available-for-sale investments       
Other investments  7.4    5.7 
Total listed investments  7.4    5.7 
Total investments  258.8    321.9 

  • The directors value the unlisted investments at R251.4 million (June 2012: R316.2 million).
  • For IAS 39 Financial Instruments: Recognition and Measurement accounting treatment of these investments, see note 38.
  December 2012
Rm
  June 2012
Rm
Reconciliation of financial assets carried at fair value through profit or loss (FVTPL)      
Opening balance 313.1    360.0 
Fair value adjustments taken to the income statement 27.7    20.8 
Interest on investment taken to finance income 0.5    1.4 
Realisation of a portion of the investment in offshore trading structure recognised in cash reserves (74.7)   (109.4)
Other   (7.9)
Participation in insurance cell-captive on extended warranties consolidated in the current period (18.8)  
Foreign exchange gains/(losses) taken to the income statement 1.0    48.2 
Closing balance 248.8    313.1 

Further details on the investments in this category:
  • The 'bare dominium revaluation' reflects Massmart's right to acquire a 49.9% share in the bare dominium over seven Makro properties. At the end of January 2013, Massmart acquired control of the seven Makro stores. This transaction is covered in more detail in note 42.
  • The 'investment in a trading and logistics structure' is in M-class preference shares representing an international treasury, shipping and trading business unit.
  • The 'participation in an insurance cell-captive on extended warranties' relates to an insurance arrangement with Mutual & Federal pertaining to extended warranties sold within the Group. In the current reporting period this cell-captive has been consolidated on a line by line basis.
  • The 'participation in an insurance cell-captive on premium contributions' relates to an insurance arrangement with Unison pertaining to general insurance within the Group. Massmart is one of four parties in the cell-captive and the substance of the relationship between the cell-captive and Massmart does not indicate that Massmart controls the cell-captive.
  December 2012
Rm
  June 2012
Rm
Reconciliation of loans and receivables      
Opening balance 3.0    3.6 
Investment realised (0.5)   (0.6)
Closing balance 2.5    3.0 

Further details on the investments in this category:

  • The 'Trencor export partnership' represents our participation in export containers.
  December 2012
Rm
  June 2012
Rm
Reconciliation of held-to-maturity investments      
Opening balance 0.1    0.1 
Amortisation taken to the income statement  
Closing balance 0.1    0.1 
Reconciliation of available-for-sale investments      
Opening balance 5.7    3.9 
Fair value adjustment 1.7    1.8 
Closing balance 7.4    5.7 


Further details on the investments in this category:

  • Listed investments include shares held on the JSE and the Zimbabwe Stock Exchange.

16. Other financial assets

  December 2012
Rm
  June 2012
Rm
Employee share trust loans to the directors and executive committee members of Massmart Holdings Limited:       
Balance at the beginning of the year  82.4    91.8 
Advanced during the year  0.9    2.2 
Repayments  (12.7)   (11.6)
Balance at the end of the year  70.6    82.4 
Other employees' loans:       
Housing and staff loans  0.4    0.5 
Finance lease deposit  33.0    37.6 
Third party loan 20.2    13.9 
Other loans  2.3    0.2 
  55.9    52.2 
  126.5    134.6 

  • These loans are classified as 'Loans and receivables'. For IAS 39 Financial Instruments: Recognition and Measurement accounting treatment of these values, see note 38.
  • All housing and staff loans bear interest at various rates below the prime interest rate. The loans to the employee share trust participants, including executive directors, attract interest of zero percent and are secured by the underlying ordinary shares in Massmart Holdings Limited. Recourse is not limited to these shares and should shares sold to repay these loans be insufficient to recover the balance outstanding, the unrecovered portion remains a debt due and payable. 1,121,116 (June 2012:1,382,228) shares with a market value of R 213,164,175 (June 2012: R232,698,084) have been pledged.
  • The finance lease deposit accrues interest at 13.8%.
  • Details of the housing and employee share trust loans to the directors and executive committee members of Massmart Holdings Limited:
  Pattison,
GM
Rm
  Hayward,
GRC
Rm
  Zwarenstein,
I
Rm
  Other
executive
committee
Rm
  Total
Rm
December 2012                   
Balance at the beginning of the year  24.6    19.8      38.0    82.4 
Advanced during the year  0.3    0.2      0.4    0.9 
Repayments  (0.6)   (6.1)     (6.0)   (12.7)
Balance at the end of the year  24.3    13.9      32.4    70.6 
June 2012                   
Balance at the beginning of the year  25.8    20.7      45.3    91.8 
Advanced during the year  0.6    0.5      1.1    2.2 
Repayments  (1.8)   (1.4)     (8.4)   (11.6)
Balance at the end of the year  24.6    19.8      38.0    82.4 

17. Deferred taxation

  December 2012
Rm
  June 2012
Rm
The movements during the year are analysed as follows:       
Net asset at the beginning of the year  301.7    242.8 
Credit/(charge) to the income statement (including foreign exchange movements) 56.3    66.3 
Credit/(charge) to other comprehensive income  1.6    (3.2)
Acquisitions/(disposals) of subsidiaries    3.1 
Non-current assets classified as held for sale    (7.3)
Net assets at the end of the year  359.6    301.7 
Deferred taxation balances are presented in the statement of financial position as follows:       
Deferred taxation assets  396.3    330.2 
Deferred taxation liabilities  (36.7)   (28.5)
  359.6    301.7 

  Opening
balance
Rm
  Credit/(charge)
to the income
statement
Rm
  Credit/(charge)
to other
comprehensive
income
Rm
  Acquisitions/
disposals of
subsidiaries
Rm
  Non-current
assets
classified as
held for sale
Rm
  Foreign
exchange
movements
Rm
  Closing
balance
Rm
December 2012                           
Temporary differences                           
Trademarks  0.8    0.3            1.1 
Assessed loss unutilised  158.6    42.2          (2.4)   198.4 
Export partnerships  (3.2)   0.5            (2.7)
Debtors provisions  18.2    (0.5)           17.7 
Prepayments  (206.6)   (21.6)           (228.2)
Creditors provisions  55.1    11.3          (0.2)   66.2 
Property, plant and equipment  (109.7)   (20.7)         (0.2)   (130.6)
Finance leases  0.7    (2.4)           (1.7)
Long-term provisions  48.5    37.4            85.9 
Income not accrued             
Deferred income  42.1    6.6          0.1    48.8 
Operating lease adjustment  303.8    11.9          (0.2)   315.5 
Other temporary differences  (6.6)   2.2    1.6        (8.0)   (10.8)
Total  301.7    67.2    1.6        (10.9)   359.6 
June 2012                           
Temporary differences                           
Trademarks  0.8              0.8 
Assessed loss unutilised  88.7    67.7        (1.0)   3.2    158.6 
Export partnerships  (3.8)   0.6            (3.2)
Debtors provisions  14.1    4.0      0.1        18.2 
Prepayments  (179.4)   (27.2)           (206.6)
Creditors provisions  74.4    (14.9)     0.3    (4.3)   (0.4)   55.1 
Property, plant and equipment  (93.7)   (18.4)     2.4        (109.7)
Finance leases  8.4    (8.0)     0.3        0.7 
Long-term provisions  47.1    1.4            48.5 
Income not accrued  (0.1)   0.1           
Deferred income  48.1    17.3        (24.6)   1.3    42.1 
Operating lease adjustment  277.1    26.8          (0.1)   303.8 
Other temporary differences  (38.9)   12.2    (3.2)     22.6    0.7    (6.6)
Total  242.8    61.6    (3.2)   3.1    (7.3)   4.7    301.7 

  • Deferred tax assets have not been recognised for assessed losses to the value of R113.6 million (June 2012: R61.9 million). Had a deferred tax asset been raised, the asset value would have been R34.3 million (June 2012: R18.7 million).

18. Inventories

  December 2012
Rm
  June 2012
Rm
Food       
Inventory at cost  3,339.8    2,619.9 
Provisions  (271.8)   (185.9)
  3,068.0    2,434.0 
Liquor       
Inventory at cost  800.5    539.6 
Provisions  (37.9)   (20.0)
  762.6    519.6 
General Merchandise       
Inventory at cost  4,619.0    3,490.6 
Provisions  (368.3)   (268.9)
  4,250.7    3,221.7 
Home Improvement       
Inventory at cost  1,820.8    1,614.8 
Provisions  (210.6)   (174.5)
  1,610.2    1,440.3 
Total inventory net of provisions  9,691.5    7,615.6 
Carrying amount of inventories carried at net realisable value  182.8    167.8 
Inventory recognised as expense in period  29,523.2    49,957.1 

  • Inventories are carried at the lower of cost and net realisable value.
  • Provisions include: shrinkage and obsolescence provisions, write-downs to net realisable value and unearned rebates and settlement discounts per SAICA Circular 9/2006 Transactions giving rise to Adjustments to Revenue/Purchases.
  • Inventory is fully funded by trade payables. Details of trade payables can be found in note 25.
  • No inventory is pledged as security.

19. Trade, other receivables and prepayments

  December 2012
Rm
  June 2012
Rm
Trade receivables  1,777.0    1,628.0 
Allowance for doubtful debts  (84.1)   (82.8)
  1,692.9    1,545.2 
Prepayments  71.6    33.9 
Other accounts receivable  1,908.7    1,353.9 
FEC asset  8.5    20.9 
Total receivables net of provisions  3,681.7    2,953.9 
Movement in allowance for doubtful debts       
Balance at the beginning of the year  82.8    59.8 
Amounts previously in the provision written off during the year  (12.8)   (17.8)
Amounts previously in the provision recovered during the year  (7.1)   (2.4)
Decrease in provision relating to assets classified as held for sale    (1.5)
Increase in provision recognised in the income statement  21.2    44.7 
Balance at the end of the year  84.1    82.8 
Ageing of debtors provided for:       
30 to 60 days  10.2    8.8 
60 to 90 days  3.1    4.0 
90 to 120 days  3.2    4.4 
120+ days  67.6    65.6 
Total  84.1    82.8 

  • No interest is charged on the trade receivables for the first 30 days from the date of the invoice. Thereafter, differing structures exist between the Divisions with interest being charged between 0% and 24% (June 2012: 0% and 24.0%) per annum on the outstanding balance. Trade receivables between 30 days and 180 days are provided for based on estimated irrecoverable amounts from the sale of goods, determined by reference to past default experience. It is the Group's policy to provide fully for all receivables that are past due that are not insured or the Group does not hold any security over the debtors, because historical experience is such that these receivables are generally not recoverable.
  • Before accepting any new customer, the Group uses an external credit scoring system to assess the potential customer's credit quality and defines credit limits by customer. Limits and scoring attributed to customers are reviewed quarterly to once a year. There is no customer who represents more than 5% of the total balance of trade receivables.
  • Included in the Group's trade receivables balance are debtors with a carrying amount of R138.6 million (June 2012: R73.1 million) which are past due at the reporting date for which the Group has not provided. The Group considers the amounts recoverable and currently holds security over these debtors or the debtors are insured. The average age of these receivables is 57 days (June 2012: 78 days).
  December 2012
Rm
  June 2012
Rm
Ageing of past due debtors but not impaired       
30 to 60 days  18.9    35.3 
60 to 90 days  57.4    16.9 
90 to 120 days  31.9    13.9 
120+ days  30.4    7.0 
Total  138.6    73.1 

  • In determining the recoverability of a trade receivable, the Group considers any change in the credit quality of the trade receivable from the date credit was initially granted up to the reporting date. The concentration of credit risk is limited due to the customer base being large and unrelated. Accordingly, the directors believe that there is no further credit provision required in excess of the allowance for doubtful debts.
  • A debtor in Massbuild has filed for liquidation. The Group remains optimistic of recovering the full outstanding amount as the payment plan identified has been met. This debtor has however been fully provided for. There were no specific trade receivables under liquidation in the prior year.
  • Trade receivables are classified as 'Loans and receivables'. For IAS 39 Financial Instruments: Recognition and Measurement accounting treatment of these values, see note 38.

20. Non-current assets classified as held for sale

Assets classified as held for sale represents small cash and carry businesses in the process of being sold that are reported in the Masscash segment. The current period comprises one business in South Africa, and the prior period comprises one business in Mozambique. In the prior period, the decision was taken to dispose of a Masscash business in South Africa, which was also completed in that period. The decision to dispose of the businesses was taken when the financial results indicated that the businesses were not producing the long-term gains anticipated and the Group is currently looking for a buyer. The assets and liabilities of the businesses classified as held for sale have been revalued to the lower of carrying value and fair value less costs to sell and disclosed separately as current in the statement of financial position.

  December 2012
Rm
  June 2012
Rm
Included in the income statement in other operating costs:       
Fair value adjustment on assets classified as held for sale  (0.4)   (7.9)
Loss on disposal of business  (4.4)   (12.1)
Included in the statement of financial position:       
Non-current assets  2.2    16.3 
Property, plant and equipment  0.4    8.6 
Goodwill  0.7   
Other intangibles  1.1    0.4 
Deferred taxation    7.3 
Current assets  0.3    86.9 
Inventories    62.5 
Trade, other receivables and prepayments  0.3    22.5 
Taxation    1.9 
Total assets  2.5    103.2 
Current liabilities    141.9 
Trade and other payables    141.9 
Total liabilities    141.9