Bidcorp

The accounting policies applied in these interim condensed consolidated financial statements are the same as those applied in the Group’s consolidated financial statements as at and for the year ended June 30 2016.

When measuring the fair value of an asset or a liability, the Group uses market observable data as far as possible. Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques categorised as follows:

• Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.
• Level 2: inputs other than quoted prices included in level 1 that are observable for the asset or liability, either directly (ie as prices) or indirectly (ie derived from prices).
• Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The following table shows the carrying amounts and fair values of financial assets and financial liabilities, including their levels in the fair value hierarchy for financial instruments measured at fair value. It does not include fair value information for financial assets and financial liabilities not measured at fair value if the carrying amount is a reasonable approximation of fair value.

The expected payments are determined by considering the possible scenarios of forecast EBITDAs, the amount to be paid under each scenario and the probability of each scenario. The valuation models consider the present value of expected payment, discounted using a risk-adjusted discount rate.

The identification of related parties and transactions with key management personnel as of and for the period ended December 31 2016 have been the same as those applied in the Group’s consolidated financial statements as at and for the year ended June 30 2016.

These results have not been audited or reviewed by the Group’s auditors. The interim condensed consolidated financial statements have been prepared by CAM Bishop (CA)SA, under the supervision of DE Cleasby CA(SA), and were approved by the board of directors on February 22 2017.

The following exchange rates were used in the conversion of foreign interests and foreign transactions during the periods:

The pro forma financial information has been compiled for illustrative purposes only and is the responsibility of the board. Due to the nature of this information, it may not fairly present the Group’s financial position, changes in equity and results of operations or cash flows. The pro forma information has been compiled in terms of the JSE Listings Requirements and the Revised Guide on Pro Forma Information by SAICA.

The Group underwent an internal restructuring with effect from April 1 2016 in anticipation of the listing and unbundling of Bidcorp on May 30 2016. The illustrative information, detailed in the statement of profit or loss, has been prepared on the basis that the internal restructuring had been effective July 1 2015 and includes pro forma adjustments on a basis consistent with those of the pre-listing statement of Bidcorp, dated April 14 2016.

The average rand exchange rate weakened against most of the significant currencies in which the Group’s foreign operations trade, namely the euro (15,01 in 2015 to 15,40 in 2016) and the Australian dollar (9,84 in 2015 to 10,57 in 2016), however, this was offset by an appreciation in the rand against sterling (20,86 in 2015 to 17,94 in 2016) following the UK referendum to leave the EU in June 2016 (Brexit). The illustrative information, detailed below, has been prepared on the basis of applying the 2015 average rand exchange rates to the 2016 foreign subsidiary income statements and recalculating the reported income of the Group for the period.