Notes to the Company annual financial statements | Note 1

The annual financial statements have been prepared on the going concern basis in accordance with, and in compliance with, International Financial Reporting Standards (IFRS) and International Financial Reporting Interpretations Committee (IFRIC) interpretations issued and effective at the time of preparing these annual financial statements and the Companies Act, No 71 of 2008.

These annual financial statements comply with the requirements of the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and the Financial Reporting Pronouncements as issued by the Financial Reporting Standards Council.

The annual financial statements have been prepared on the historic cost convention, adjusted for financial instruments measured at fair value through profit or loss, and incorporate the principal accounting policies set out below and through the notes. They are presented in South African Rand (R), which is the Company's functional currency.

These accounting policies are consistent with the previous period.

The annual financial statements relate to the statutory entity. The consolidated annual financial statements of Blue Label Telecoms Limited are available from the Company's registered office and online from the Company's website.

The preparation of annual financial statements in conformity with IFRS requires management, from time to time, to make judgements, estimates and assumptions that affect the application of accounting policies and reported amounts of assets, liabilities, income and expenses. These estimates and associated assumptions are based on experience and various other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected.

For details of the significant judgements and estimates used, refer to the individual notes addressing key areas:

Impairment of financial assets

The impairment provisions for financial assets are based on assumptions about risk of default and expected loss rates. The Company uses judgement in making these assumptions and selecting the inputs to the impairment calculation, based on the Company’s past history, existing market conditions as well as forward-looking estimates at the end of each reporting period.

For details of the key assumptions and inputs used, refer to the individual notes addressing financial assets:

Assessment of investments in subsidiaries, associates and joint ventures for impairment

The Company tests annually whether there are any indicators of impairment present that would require an impairment test to be performed to assess whether investments in subsidiaries, associates and joint ventures may have suffered any impairment, in accordance with the accounting policy. The recoverable amounts of the investments in subsidiaries, associates and joint ventures have been determined based on fair value less costs of disposal or value-in-use calculations. These calculations require the use of estimates. Refer to note 3 and 4 for details of these estimates.