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AFRICAN DAWN 2015 Annual Report

Notes to the Financial Statements continued Group Company 2015 R’000 2014 R’000 AFRICAN DAWN 100 ANNUAL REPORT 2015 35. Tax paid 2015 R’000 2014 R’000 Balance at beginning of the year (17,734) (18,270) (6,728) (6,728) Current tax for the year recognised in profit (1,448) (407) - - or loss Adjustment in respect of business liquidated (refer to note 38) 6,497 - - - Business combination businesses acquired (refer to note 37) (19) - - - Adjustment in respect of penalties and interest (2,710) (25) (1,077) - Balance at end of the year 14,840 17,734 7,805 6,728 (574) (968) - - 36. Cash flows from discontinued operations African Dawn Debt Management Proprietary Limited (refer to note 33). - (1,983) - - 37. 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 R 8,076,000 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. Goodwill is not deductible for income tax purposes. 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 -


AFRICAN DAWN 2015 Annual Report
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