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Audited Results for the Year Ended 31 December 2014, Notice Of Annual General Meeting and Change in Company Secretar
VUNANI LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1997/020641/06)
JSE code: VUN
ISIN: ZAE000163382
(“Vunani” or “the company”)
AUDITED RESULTS FOR THE YEAR ENDED 31 DECEMBER 2014, NOTICE OF ANNUAL
GENERAL MEETING AND CHANGE IN COMPANY SECRETARY
Audited Results
Shareholders are advised that the audited annual financial statements for the year ended 31 December
2014, which are included in the company's integrated annual report for that year, have been dispatched
to shareholders today, 22 June 2015. The audited annual financial statements are unchanged from the
reviewed results published on SENS on 30 March 2015, apart from the following changes that were
made:
All values are expressed in R’000
Consolidated statement of financial position
at 31 December 2014
Annual
Reviewed Financial
Results Adjustment Statements
Other financial liabilities
(non-current) 36 144 (15 846) 20 298
Other financial liabilities
(current) 9 436 15 846 25 282
The adjustment was required as a result of reclassification of certain liabilities from non-current to
current due to the lack of defined repayment terms.
Furthermore, note 9 “Financial instruments carried at fair value’ as published in the reviewed provisional
condensed results, was presented as follows:
9. Financial instruments carried at fair value
The fair value of a financial instrument is the price that would be received for the sale of an
asset or paid for the transfer of a liability in an orderly transaction between market participants
at the measurement date. Underlying the definition of fair value is a presumption that an entity
is a going concern without any intention or need to liquidate, to curtail materially the scale of
its operations or to undertake a transaction on adverse terms. Fair value is not, therefore, the
amount that an entity would receive or pay in a forced transaction, involuntary liquidation or
distressed sale.
The existence of published price quotations in an active market is the best evidence of fair
value and, where they exist, they are used to measure the financial asset or financial liability.
A market is considered to be active if transactions occur with sufficient volume and frequency
to provide pricing information on an ongoing basis. Financial instruments fair valued using
quoted prices would generally be classified as level 1 in terms of the fair value hierarchy.
Where a quoted price does not represent fair value at the measurement date or where the
market for a financial instrument is not active, the group establishes fair value by using a
valuation technique. These valuation techniques include reference to the value of the assets
of underlying business, earnings multiples (e.g. unlisted investments), discounted cash flow
analysis (e.g. unlisted investments, loans and advances) and various option pricing models.
Valuation techniques applied by the group would result in financial instruments being
classified as level 2 or level 3 in terms of the fair value hierarchy. The determination of whether
a financial instrument is classified as level 2 or level 3 is dependent on the significance of
observable inputs versus unobservable inputs in relation to the fair value of the financial
instrument.
Inputs typically used in valuation techniques include discount rates, expected future cash
flows, dividend yields, earnings multiples, volatility, equity prices and commodity prices.
Valuation methodologies and techniques applied for level 3 financial instruments include a
combination of discounted cash flow analysis, application of earnings multiples on sustainable
after tax earnings, current and projected net asset values to determine overall reasonability.
The valuation technique applied to specific financial instruments depend on the nature of the
financial instrument and the most appropriate valuation technique is determined on that basis.
After the valuations of the unlisted financial assets and liabilities are performed, these are
presented to the group’s investment committee for independent review. All significant
valuations are approved by the investment committee.
The valuation methodologies, techniques and inputs applied to the fair value measurement
of the financial instruments have been applied in a manner consistent with that of the previous
financial year.
Reviewed Audited
31 December 31 December
2014 2013
Fair values Carrying Carrying
Figures in R’000s amount Fair value amount Fair value
Financial assets measured at fair value
Designated at fair value through profit or 134 783 134 783 144 885 144 885
loss on initial recognition
Financial assets not measured at fair
value
Loans and receivables 179 445 179 445 164 519 164 519
Non-current assets held for sale – – 34 34
Trading securities 251 251 320 320
314 479 314 479 309 758 309 758
Financial liabilities measured at fair value
Designated at fair value through profit or
(2 554) (2 554) (6 971) (6 971)
loss on initial recognition
Financial liabilities not measured at fair
value
Amortised cost (193 106) (193 106) (198 720) (198 720)
Non-current liabilities held for sale – – (2 479) (2 479)
(195 660) (195 660) (208 170) (208 170)
At 31 December 2014 the fair values of all the financial instruments are substantially identical to the carrying
amount reflected in the statement of financial position.
Fair value hierarchy
The table below analyses recurring fair value measurements for financial assets and financial liabilities.
These fair value measurements are categorised into different levels in the fair value hierarchy based on
inputs to the valuation techniques used.
The different levels are defined as
follows:
– Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.
– Level 2: Inputs other than quoted prices included within level 1 that are observable for the asset or liability,
either directly (i.e. as prices) or indirectly (i.e. derived from prices).
– Level 3: Inputs for the asset or liability that are not based on observable market data (unobservable inputs).
Reviewed 31 December 2014
Figures in R’000s Level 1 Level 2 Level 3 Total
Financial assets designated at fair value
96 339 – 38 444 134 783
through profit or loss
Financial liabilities designated at fair
– – (2 554) (2 554)
value through profit or loss
96 339 – 35 890 132 229
Audited 31 December 2013 Level 1 Level 2 Level 3 Total
Financial assets designated at fair value
80 240 – 64 645 144 885
through profit or loss
Financial liabilities designated at fair
– – (6 971) (6 971)
value through profit or loss
80 240 – 57 674 137 914
Reviewed Audited
31 December 31 December
Figures in R’000s 2014 2013
Level 3 comprises:
Balance at beginning of year 57 674 (38 635)
Total gains or losses in profit or loss (24 927) 19 573
Proceeds from loan, interest and repayments – 70 697
Purchases, transfers, sales, issues and
3 143 6 039
settlements
Balance at end of the year 35 890 57 674
A change of 10% in the unobservable inputs of the investment and liability at the reporting date would
have increased/(decreased) equity and profit or loss by the amount shown below. This analysis assumes
that all other variables remain constant.
Reviewed Audited
31 December 31 December
Figures in R’000s 2014 2013
Effect on statement of comprehensive income
(profit/(loss)) and equity before taxation 2014 2013
10% increase 5 867 5 767
10% decrease (1 725) (5 767)
As a result of the finalisation of the audit of the annual financial statements, the disclosure in the above
note changed substantially in the way it is presented in the audited annual financial statements
compared to the way it was previously presented in the above note 9. The change resulted from the
following:
- The composition of the financial assets (both measured at fair value and not measured at fair
value) disclosed in this note was revised.
- The most significant revision related to the disclosure around loans and receivables, which are not
measured at fair value. The carrying value of all other loans and receivables approximates fair
value, with the exception of loans to associates and loans in other non-current assets, which are
carried at amortised cost.
The notes corresponding to note 9 in the integrated annual report are notes 43.4 and 43.5, which are
presented in the audited annual financial statements as follows:
43.4 Fair values
The fair value of a financial instrument is the price that would be received for the sale of an asset or
paid for the transfer of a liability in an orderly transaction between market participants at the
measurement date. Underlying the definition of fair value is a presumption that an entity is a going
concern without any intention or need to liquidate, to curtail materially the scale of its operations or to
undertake a transaction on adverse terms. Fair value is not, therefore, the amount that an entity would
receive or pay in a forced transaction, involuntary liquidation or distressed sale.
The existence of published price quotations in an active market is the best evidence of fair value and,
where they exist, they are used to measure the financial asset or financial liability. A market is
considered to be active if transactions occur with sufficient volume and frequency to provide pricing
information on an ongoing basis. Financial instruments fair valued using quoted prices would generally
be classified as level 1 in terms of the fair-value hierarchy.
Where a quoted price does not represent fair value at the measurement date or where the market for a
financial instrument is not active, the group establishes fair value by using a valuation technique. These
valuation techniques include reference to the value of the assets of underlying business, earnings
multiples (e.g. unlisted investments), discounted cash flow analysis (e.g. unlisted investments, loans
and advances) and various option pricing models.
Valuation techniques applied by the group would result in financial instruments being classified as level
2 or level 3 in terms of the fair-value hierarchy. The determination of whether a financial instrument is
classified as level 2 or level 3 is dependent on the significance of observable inputs versus
unobservable inputs in relation to the fair value of the financial instrument.
Inputs typically used in valuation techniques include discount rates, expected future cash flows,
dividend yields, earnings multiples, volatility, equity prices and commodity prices.
Valuation methodologies and techniques applied for level 3 financial instruments include a combination
of discounted cash flow analysis, application of earnings multiples on sustainable after tax earnings and
or current and projected net asset values to determine overall reasonability. The valuation technique
applied to specific financial instruments depend on the nature of the financial instrument and the most
appropriate valuation technique is determined on that basis.
After the valuations of the unlisted financial assets and liabilities are performed, these are presented to
the group's investment committee for independent review. All significant valuations are approved by the
investment committee.
The valuation methodologies, techniques and inputs applied to the fair value measurement of the
financial instruments have been applied in a manner consistent with that of the previous financial year.
Fair values 31 December 31 December 31 December
All values presented in R'000 31 December 2014 2014 2013 2013
Financial assets measured
at fair value Carrying amount Fair value Carrying amount Fair value
Designated as fair value
through profit or loss on initial
recognition 134 874 134 874 144 885 144 885
Trading securities 251 251 320 320
Financial assets not
measured at fair value
Other non-current assets 4 788 5 786 4 388 5 489
Loans to associates 14 325 11 537 16 323 13 674
Non-current assets held for
sale - - 34 34
154 238 152 448 165 950 164 368
Financial liabilities
measured at fair value
Designated as fair value
through profit or loss on initial
recognition (2 554) (2 554) (6 971) (6 971)
Financial assets not
measured at fair value
Other financial liabilities (45 580) (42 760) (46 504) (40 152)
Non-current assets held for
sale (2 479) (2 479)
(48 134) (45 314) (55 954) (49 602)
The carrying amounts of cash and cash equivalents, accounts receivable from trading activities, trade and other
receivables, bank overdraft, accounts payable from trading activities and trade, non-current assets and liabilities
held for sale and other payables reasonably approximate their fair values.
43.5 Fair value hierarchy
The table below analyses recurring fair value measurements for financial assets and financial liabilities. These fair
value measurements are categorised into different levels in the fair value hierarchy based on inputs to valuation
techniques used.
The different levels are defined as follows:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either
directly (i.e. as prices) or indirectly (i.e. derived from prices).
Level 3: Inputs for the asset or liability that are not based on observable market data (unobservable inputs).
All values in R’000
31 December 2014 Level 1 Level 2 Level 3
Financial assets designated at fair value through
profit or loss 96 430 – 38 443
Financial assets measured at fair value 251 – –
Financial assets measured at amortised cost – – 17 323
Financial liabilities designated at fair value
through profit or loss – – (2 554)
Financial liabilities measured at amortised – – (42 760)
96 681 – 10 452
31 December 2013
Financial assets designated at fair value through
profit or loss 80 240 – 64 645
Financial assets measured at fair value 320 –
Financial assets measured at amortised cost – 19 163
Financial liabilities designated at fair value
through profit or loss – – (6 971)
Financial liabilities measured at amortised – (40 152)
80 560 – 36 685
31 December 31 December
All values in R’000 2014 2013
Level 3 comprises:
Balance at beginning of year 57 674 (38 635)
Total gains or losses in profit or loss (24 927) 19 573
Proceeds from loan, interest, repayment – 70 697
Purchases, sales, issues and settlements 3 143 6 039
Balance at end of year 35 890 57 674
A change of 10% in the unobservable inputs of the investment and liability at the reporting date would
have increased/(decreased) equity and profit or loss by the amount shown below. This analysis
assumes that all other variables remain constant.
Effect on statement of comprehensive income (profit/(loss)) and equity before taxation
All values in R’000 31 December 2014 31 December 2013
Net asset value
10% increase 1 309 5 767
10% decrease (1 192) (5 767)
Free cash flow
10% increase 777 9 762
10% decrease 821 (4 806)
No other modifications or reclassifications have been made to the audited annual financial statements.
The integrated annual report will also be made available on the company’s website hosted at
www.vunanilimited.co.za, as well as at the company’s registered offices at 151 Katherine Street, Vunani
Office Park, Vunani House, Sandton.
Notice of Annual General Meeting
Notice is hereby given that the annual general meeting of shareholders of the company will be held on
Tuesday, 21 July 2015 at 10h00 in the boardroom, 151 Katherine Street, Vunani Office Park, Vunani
House, Sandton to transact the business as stated in the notice of annual general meeting forming
part of the company's integrated annual report.
Change in Company Secretary
Shareholders are advised that CIS Company Secretaries Proprietary Limited has been appointed as
Company Secretary with effect from 22 June 2015.
Aphrodite Judin, the group chief financial officer who has been fulfilling the role of company secretary
for the group, will retain her role as full time group chief financial officer.
22 June 2015
Sandton
Designated Adviser
Grindrod Bank Limited
Date: 22/06/2015 03:14:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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