106 / 170
2016
R’000
2015
R’000
30.
COMMITMENTS
Capital expenditure approved:
Contracted for
568 683
407 181
Not contracted for
939 434
989 645
1 508 117
1 396 826
Capital expenditure amounting to R1 459 million (2015: R1 312 million) is in respect of property, plant and equipment and the remaining
balance is in respect of computer software. It is anticipated that capital expenditure will be financed out of existing cash resources.
31.
CONTINGENT LIABILITIES
The group has outstanding legal and other claims arising out of its normal ongoing operating activities. None of these claims are significant.
32.
FINANCIAL INSTRUMENTS
32.1 Risk management overview
The group has exposure to the following risks from its use of financial instruments: credit risk, liquidity risk and market risk, including interest
rate risk, currency risk and equity price risk.
This note presents information about the group’s exposure to each of the aforementioned risks, the group’s objectives, policies and
processes for measuring and managing risk, and the group’s management of capital. IFRS 7 requires certain disclosures by class of
instrument which the group has determined would be the segments as disclosed in the segmental report.
The group’s major financial risks are mitigated in the way that it operates firstly through diversification of geography and secondly through
decentralisation of the business model. Bidcorp is an international group with operations in the United Kingdom, Europe, Asia, Australia,
New Zealand, South America, Middle East and various southern African countries.
Bidcorp’s philosophy has always been to empower management through a decentralised structure thereby making operational management
responsible and accountable for the performance of its operations, including managing the financial risks of the operation. The operational
management report to divisional management who in turn report to the Bidcorp board of directors. The divisional management is also
held responsible for managing financial risks of the operations within its divisions. Operational management’s remuneration is based on its
operation’s performance and divisional management based on its division’s performance resulting in a decentralised and entrepreneurial
environment.
Due to the diverse structure and decentralised management of the group, the group audit and risk committee has implemented guidelines
of acceptable practices and basic procedures to be followed by divisional and operational management. The information provided below for
each financial risk has been collated for disclosure based on the manner in which the business is managed and what is believed to be useful
information for stakeholders.
The overall process of risk management in Bidcorp, which includes the related system of control, is the responsibility of the Bidcorp board of
directors. The audit and risk committee is governed by a charter and reports regularly to the board of directors on its activities.
Notes to the consolidated financial statements
for the year ended June 30
Page 102
| Bidcorp Limited Annual integrated report 2016