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2015

RCS GROUP CONSOLIDATED FINANCIAL STATEMENTS

15

1.

Presentationof Financial Statements

The holding company, RCS Investment Holdings Limited, is a

company domiciled in SouthAfrica. The consolidated financial

statements as at and for the period ended 31 December 2015

comprise the company, its subsidiaries and its associates

(together referred to as the “RCS Group”). The company has

foreign subsidiaries operating in Namibia and Botswana.

The consolidated financial statements are prepared in

accordancewith International Financial Reporting Standards

(IFRS) and the requirements of the Companies Act of South

Africa. The accounting policies have been consistently

applied with those adopted in the prior financial period.

During the current financial period, the financial year has

changed from 31 March to 31 December to align with the

reporting requirements of the shareholder. The current

period financial results are therefore only representative of

a 9 month period. The current and prior period results are

therefore not comparable.

1.1 Basis of Preparation

The consolidated financial statements have been prepared

on the basis that the RCS Group is a going concern and on

the historical cost basis.

The consolidated financial statements were authorised for

issue by the board of directors on 22 April 2016.

1.2 Functional and Presentation Currency

These consolidated financial statements are presented in

South African Rands which is RCS Investment Holdings

Limited’s functional and presentation currency. All amounts

have been rounded to the nearest thousand, unless otherwise

indicated.

1.3 Basis of Consolidation

Subsidiaries

The financial statements of subsidiaries are prepared for a

consistent reporting period using consistent accounting policies.

Business Combination

Business combinations are accounted for using the acquisition

method as at the acquisition date, which is the date on which

control is transferred to the group.

The group controls an entity when the group is exposed to,

or has rights to, variable returns from its involvement with

the entity and has the ability to affect those returns through

its power over the entity. Subsidiaries are fully consolidated

from the date on which control is transferred to the group.

They are consolidated until the date that control ceases.

The group measures goodwill at the acquisition date as:

• the fair value of the consideration transferred; plus

• the recognised amount of any non-controlling interest in

the acquiree; plus

• if the business combination is achieved in stages, the fair

value of the pre-existing equity interest in the acquiree; less

• the net recognised amount (generally fair value) of the

identifiable assets acquired and liabilities assumed.

When the excess is negative, a gain on bargain purchase is

recognised immediately in the income statement.

The consideration transferred does not include amounts

related to the settlement of pre-existing relationships. Such

amounts generally are recognised in profit or loss.

Transaction costs, other than those associated with the issue

of debt or equity securities, that the group incurs in connection

with a business combination are expensed as incurred.

Any contingent consideration payable is measured at fair

value at the acquisition date. If the contingent consideration is

classified as equity it is not remeasured. Otherwise, subsequent

changes in the fair value of the contingent consideration are

recognised in profit or loss.

Accounting Policies

for the period ended 31 December 2015