MENU Notes to the financial statementsfor the year ended 30 June 2015

  1. Accounting policies
  2. Definitions
  3. Revenue
  4. Cost of sales
  5. Trading profit
  6. Share-based payments
  7. Finance revenue
  8. Finance cost
  9. Taxation
  10. Earnings per share
  11. Headline earnings per share
  12. Dividends paid in the current year
  13. Property, plant and equipment
  14. Investment properties
  15. Investments
  16. Long-term financial assets
  17. Goodwill
  18. Deferred taxation
  19. Inventories
  20. Trade and other receivables
  21. Cash and cash equivalents
  22. Stated capital
  23. Non-distributable reserve
  24. Interest-bearing loans and borrowings
  25. Trade and other payables
  26. Provisions
  27. Reconciliation of profit before taxation to cash generated from operations
  28. Taxation paid
  29. Dividends paid
  30. Commitments and contingencies
  31. Employee benefits
  32. Financial risk management objectives and policies
  33. Related-party transactions
  34. Segment report (restated)
  35. Subsequent events
  36. Discontinued operations
  37. Loss of control in subsidiary
  38. Group entities
Company           Group  
2015  
Rm’s  		     2014  
Rm’s  		         2015  
Rm’s  		     2014  
Rm’s  
          15.  Investments            
        15.1 Investments            
            Unlisted            
8       8       Investment in subsidiaries            
51       34       Equity instruments – at cost            
125       124       Preference shares            
184       166       Directors’ valuation of unlisted investments            
            Investments in subsidiaries are carried at cost less accumulated impairment. A list of subsidiaries appears in note 38.            
            Equity instruments in the Company’s records relates to the notional investment cost as a result of the Group share-based payment schemes as disclosed in note 6.            
            Unlisted equity instruments have no reliable measure of fair value as there is no active trading market for these instruments, therefore these investments are carried at cost less accumulated impairment.            
          15.2   Investment in associates            
            Ezeetile            
           

During the 2011 financial year, the Group began accounting for an existing investment in Ezeetile, a national manufacturer of adhesive, grout and related products, in accordance with the equity accounting requirements of IAS 28 – Investments in Associates. The Group holds an effective 46% stake in the Ezeetile group.  

          
            Carrying value of investment in the Ezeetile group:            
            Cost – closing balance     19       17  
            Cost – opening balance     17       17  
            Purchase of additional minority interest     2       —  
            Share of profit and reserve movements post commencement of equity accounting
(net of dividends) 		   20       13  
            Share of profits     26       18  
            Reserve movements     —       —  
            Dividends received     (6)      (5) 
                39       30  
            Ceramic Industries (Pty) Ltd            
            During the 2013 financial year, the Group acquired a 20% stake in Ceramic Industries (Pty) Ltd, a national manufacturer of tiles and sanitaryware, at a cost of R529 million. This investment is accounted for as an associate in terms of IAS 28, as management is of the opinion that by virtue of the supply relationship, significant influence exists.            
            Carrying value of Investment in Ceramic Industries (Pty) Ltd:            
            Cost     529       529  
             Share of profit and reserve movements post commencement of equity accounting (net of dividends)    4       (37) 
            Share of profits     84       30  
            Reserve movements     4       7  
            Dividends received     (84)      (74) 
                533       492  
            SER-Export s.p.a.            
            During the current year the Group disposed of a 20% stake in SER-Export s.p.a. to its existing partner in this entity, reducing the Group’s effective shareholding to 30%. The result of the loss of control means that the Group now accounts for its investment in SER-Export s.p.a. as an investment in associate in accordance with IAS 28 – Investment in Associates and Joint Ventures and IFRS 10 – Consolidated Financial Statements (refer to note 37).            
            Carrying value of investment in SER-Export s.p.a.:            
            Cost     19       —  
                19       —  
            Total carrying amount of investments in associates     591       522  
            The following tables illustrate the summarised financial information of the Group’s investment in the Ezeetile group, Ceramic Industries (Pty) Ltd and SER-Export s.p.a.:            
            Statement of financial position:            
            Non-current assets     989       798  
            Current assets     1 007       789  
            Non-current liabilities     (57)      (87) 
            Current liabilities     (393)      (267) 
            Equity     1 546       1 233   
            Statement of comprehensive income:            
            Turnover     2 891       2 329  
            Profit for the year     299       130  
            Profit attributable to ordinary shareholders of Italtile Limited     62       29  
            Reserve movements attributable to ordinary shareholders of Italtile Limited     (3)      3  
            Less: Dividends     (12)      (64) 
            Share of associated companies’ income     47       (32)