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AFRICAN DAWN Annual Report 2016

continued Notes to the Financial Statements Annual Financial Statements For the year ended 29 February 2016 31. Tax paid Group Company 2016 R’000 2015 R’000 2016 R’000 2015 R’000 Balance at beginning of the year (14,840) (17,734) (7,805) (6,728) Current tax for the year recognised in profit (583) (1,448) - - or loss Adjustment in respect of business liquidated (refer to note 33) - 6,497 - - Business combination businesses acquired (refer to note 32) - (19) - - Adjustment in respect of penalties and interest (938) (2,710) (415) (1,077) Balance at end of the year 15,054 14,840 8,220 7,805 (1,307) (574) - - 32. Business combinations Knife Capital Group On 28 March 2014 the group acquired 100% of the equity interest in Knife Capital Group which resulted in the group obtaining control over Knife Capital Group. The terms were outlined in the circular issued on 13 December 2013. Knife Capital owns 100% of Grindstone. The Knife Capital Group operates in South Africa and it is principally involved in business development services and investment management. The reason for the acquisition is to realise the new vision for the Afdawn Group. Goodwill of R8,076,000 arose from the acquisition, (refer to note 4) and is attributable mainly to the synergies and economies of scale expected from combining the operations of the entities, as well as from other intangible assets, including brands, which did not qualify for separate recognition. Acquisition of Knife Capital Group Purchase price calculation - - - - 100 million shares issued on 28 March 2014 - 9,000 - 9,000 at a share price of 9c (A). First NAV liability - additional payment of the difference between the 10c per share stipulated in the acquisition agreement and the NAV per share at 28 February 2014 (B). - 1,460 - 1,460 Second NAV liability - top-up of the First NAV liability due to the Elite prior period error, which further reduced the Group NAV per share at 28 February 2014 (C). - 2,095 - 2,095 Share issue liability - additional payment due because Afdawn Group did not raise capital of R50 million by 26 March 2015 (D). - 2,000 - 2,000 Recognition of share issue liability in profit or loss as it relates to the subsequent fair value of the contingent consideration (D). - (2,000) - (2,000) - 12,555 - 12,555 88 AFRICAN DAWN ANNUAL REPORT 2016


AFRICAN DAWN Annual Report 2016
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