Notes to the Group Annual Financial Statements | Note 3.3

3. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT
3.3 FINANCIAL ASSETS
3.3.1 LOANS RECEIVABLE
  2026 
R'000 		   2025 
R'000 
Interest-free loans  40 921    39 308 
Interest-bearing loans receivable  158 478    76 888 
Less: Provision for impairment  (8 986)   (12 420)
  190 413    103 776 
Amounts included in non-current portion of loans receivable  98 251    46 536 
Amounts included in current portion of loans receivable  92 162    57 240 

All loans receivable are unsecured and repayable within five years. Interest-bearing loans bear interest at a range of between prime and prime plus two percent. The fair value of the loans, which include loans to product distributors, approximates their carrying value.
3.3.2 TRADE AND OTHER RECEIVABLES

Trade receivables comprise receivables that are due from customers which arise from transactions for the sale of goods and rendering of services in the ordinary course of business. For details related to the ECLs, refer to note 3.2.1. Receivables for prepayments and VAT are stated at their nominal values.

The following table provides an analysis of the Group's trade and other receivables, including an analysis of trade receivables by originating transaction type as well as by counterparty:

  2026 
R'000 		   2025 
R'000 
TRADE RECEIVABLES ARISING ON REVENUE FROM CONTRACTS WITH CUSTOMERS  2 422 570    2 615 156 
Banks  469 786    373 941 
Aggregators, independent and informal retail customers  820 375    1 398 803 
Formal market retail customers  564 778    456 844 
Customers in the petroleum sector  96 226    71 884 
Receivables for starter packs  22 098    33 073 
Cell C  6 263    8 522 
Other cellular networks  161 518    33 270 
Municipalities and private utilities  281 526    238 819 
Less: Provision for impairment  (19 922)   (33 883)
Net trade receivables  2 402 648    2 581 273 
Receivables from revenue recognised on fixed term contracts  110 115    144 091 
Prepayments  300 849    1 186 276 
Net sundry debtors  122 992    236 084 
VAT  138 923    152 972 
  3 075 527    4 300 696 

The fair value of the trade and other receivables approximates their carrying amounts due to the market-related discount factor that has been applied to the balances.

There is a cession of trade receivables, including inter-group balances, of R2.146 billion (2025: R2.332 billion) in favour of the Group bankers for facilities referred to in note 3.2.

RECEIVABLES FOR STARTER PACKS

The normal operating cycle for some starter pack debtors exceeds 12 months but are considered current due to management expecting to realise the assets in their normal operating cycle.

RECEIVABLES FROM REVENUE RECOGNISED ON FIXED TERM CONTRACTS

The Group's receivables from revenue recognised on fixed term contracts comprise the following movements for the year:

  2026 
R'000 		   2025 
R'000 
Balance at the beginning of the year  144 091    169 304 
Revenue recognised – handsets, tablets and other devices  139 287    191 942 
Revenue recognised – finance revenue  20 712    27 313 
Amounts becoming due in the year  (193 975)   (244 468)
  110 115    144 091 

Included in receivables from revenue recognised on fixed term contracts are amounts of R24 million (2025: R29 million) which have a cycle period in excess of 12 months but are considered current due to management expecting to realise the assets in their normal operating cycle of 24 months.

PREPAYMENTS

Included in prepayments is an amount of Rnil (2025: R152 million) relating to payments to Cell C where TPC does not bear the risks and rewards of ownership until it is able to freely sell the prepaid airtime. As a result these amounts have not been included into prepaid airtime inventory. The prepayment will be tested for impairment at each reporting date.
3.3.3 ADVANCES TO CUSTOMERS

Advances to customers comprised receivables arising on financing transactions where, in substance, the nature of the business activities undertaken by certain subsidiaries of the Group was to engage in the provision of financing.

Upon the disposal of Cell C (including CEC) advances to customers have been derecognised.

  2026 
R'000 		   2025 
R'000 
Handset financing and subscription income-sharing receivables  –    1 908 275 
Less: Provision for impairment  –    (264 508)
  –    1 643 767 
Amounts included in non-current portion of advances to customers  –    653 146 
Amounts included in current portion of advances to customers  –    990 621 

The fair value of the advances to customers approximates their carrying amounts due to the market-related discount factor that has been applied to the balances.
3.3.4 CASH AND CASH EQUIVALENTS

Cash and cash equivalents include cash on hand and deposits held on call with banks.

  2026 
R'000 		   2025 
R'000 
Cash at bank  963 007    820 782 
Cash on hand  1 732    1 322 
  964 739    822 104 
Bank overdraft  (21)   (831)
  964 718    821 273 

Included in this balance is restricted cash of R2.7 million (2025: R34.2 million), received on behalf of and immediately due to third parties, which may not be utilised in the Group's ordinary course of business.