105 / 170
2016
R’000
2015
R’000
29. PROVISIONS
Long-term portion
397 970
340 649
Short-term portion
358 319
267 094
756 289
607 743
Onerous
contracts
R’000
Dismantling
and site
restoration
R’000
Customer
loyalty
programme
R’000
Other
R’000
Total
R’000
Balance at July 1 2014
42 760
324 039
98 599
44 815
510 213
Created
22 847
69 909
35 846
39 764
168 366
Utilised
259
(58 329)
(28 845)
(13 940)
(100 855)
Net acquisition of businesses
–
2 704
–
25 238
27 942
Exchange rate adjustments
1 908
5 692
(5 931)
408
2 077
Balance at June 30 2015
67 774
344 015
99 669
96 285
607 743
Created
806
166 865
25 031
53 173
245 875
Utilised
(31 649)
(65 400)
(18 832)
(60 039)
(175 920)
Net acquisition of businesses
–
2 149
(178)
(1 533)
438
Exchange rate adjustments
7 338
27 912
17 159
17 136
69 545
Effect of discounting
1 383
7 225
–
–
8 608
Balance at June 30 2016
45 652
482 766
122 849
105 022
756 289
Onerous contracts
Onerous contracts are identified through regular reviews of the terms and conditions of contracts as well as on the acquisition of businesses.
A provision for onerous contracts is calculated as the present value of the portion which management deems to be onerous in light of the
current market conditions, discounted using market-related rates. An annual expense is recognised over the life of the contracts.
Provision for cost of dismantling and site restoration
A provision is raised for the estimated costs of dismantling and removing items, and restoring the property on which they are located. The
change in the liability arising as a result of unwinding the discount is recognised in the statement of profit or loss as a finance charge. The
dismantling of the plant and recommissioning of buildings is expected to coincide with the end of the useful life of the plant and lease periods.
Customer loyalty programme
This is a customer loyalty programme introduced by certain operations within the group, whereby customers can earn points for redemption in
the form of gift certificates and products of the operations. The provision is calculated based on the points outstanding at year-end.
Other
Other consists of various individually insignificant provisions.
Bidcorp Limited Annual integrated report 2016 |
Page 101
Financial overview