Notes to the Group Annual Financial Statements – Note 9

9. Investment in associates
 
  Group   Company  
  June 2018
R’000
  June 2017
R’000
  June 2018
R’000
  June 2017
R’000
 
Carrying value 56 935   38 823      

During the prior year a 51% interest was purchased in The Cheese has Moved Proprietary Limited. The Shareholders’ Agreement between the parties includes a key clause which establishes a threshold of 75% of voting rights for key decisions affecting the strategy of the business. Apart from the mechanisms of power set out in the Shareholders’ Agreement and reference to the “standard MOI” in terms of the Companies Act, there are no other mechanisms through which AfroCentric could exert power directly. Several different combinations of shareholders voting in favour of key decisions can achieve the threshold. Therefore, it is evident that AfroCentric does not have control over The Cheese has Moved Proprietary Limited with its 51%.The Group has significant influence over this entity.

In the current year, only Activo Health Proprietary Limited’s total aggregate assets, liabilities and results of operations are disclosed as it is the most significant associate.

  Group  
  June 2018
R’000
  June 2017
R’000
 
Non-current assets (excluding intangible assets) 835   1 227  
Intangible assets 22 750   21 536  
Current assets 161 156   109 035  
Total assets 184 741   131 798  
Non-current liabilities 10 163
  1
 
Current liabilities 60 003   74 909  
Total liabilities 70 166   74 910  
Net assets 114 575   56 888  
Reconciliation to carrying amounts:        
Opening net assets 1 June 56 888   19 750  
Profit for the period 68 679   37 138  
Closing net assets 125 567   56 888  
Group’s share in % 26   26  
Group’s share in R 32 647   14 790  
Goodwill 11 303   11 303  
Carrying amount 43 950   26 093  
Revenue 590 920   388 058  
Total comprehensive income attributable to ordinary shareholders 68 679   37 138  
Net profit for the year 68 679   37 138  

Individually immaterial associates

In addition to the interest in Activo Health disclosed above, the Group has interests in The Cheese has Moved and Associated Fund Administrators who are immaterial associates that are accounted for using the equity method.

 

  Group  
  June 2018
R’000
  June 2017
R’000
 
Aggregate carrying amount of individually immaterial associates 13 291   12 730  
Aggregate amounts of the Group’s share of:        
Profit from continuing operation 5 770   4 649  
Total comprehensive income 5 770   4 649  

   Reporting
date
 
Number 
of shares 
held
 
Percentage 
Holdings
 
1 July 2017 
Opening 
carrying 
amount 
R’000
 
Share of 
after tax 
profit/ 
(losses)
R’000
 
Dividends 
received/ 
(paid)
R’000
 
   30 June 
2018 
Closing 
carrying 
amount 
R’000 
  
Unlisted                            
Activo Health Proprietary Limited  30 June  260  26  26 093  17 857  –     43 950    
Associated Fund Administrators Botswana Proprietary Limited  30 September  24 000  24  8 405  5 140  (5 208)    8 337    
Invisible Card Company Proprietary Limited  30 June  30  40  –  –  –     –    
The Cheese Has Moved Proprietary Limited*  30 June  51  51  4 325  629  (306)    4 648    
AfroCentric Health Solutions Limited (Kenya Investments) 31 December  26  26  –  –  –     –    
            38 823  23 626  (5 514)    56 935    

* Refer to Note 33 for subsequent events.

All the above are incorporated in South Africa except for Associated Fund Administrators Botswana Proprietary Limited which is incorporated in Botswana and AfroCentric Health Solutions Limited which is incorporated in Kenya.

Due to the Group’s non-controlling interest in Associated Fund Administrators Botswana Proprietary Limited, it has no influence in aligning their reporting dates with the Group’s. Management accounts was used to equity account this investment. In the current financial year, Activo Health has aligned its reporting date with the Group, 30 June 2018.


Notes to the Group Annual Financial Statements – Note 9