NOTES TO THE GROUP ANNUAL FINANCIAL STATEMENTS for the year ended 30 June 2010

					2010	2009
					Rm	Rm
21.	Retirement benefit obligations
	Defined contribution plans
	The group provides retirement benefits through independent funds under the control of trustees and all contributions to those funds are charged to the statement of comprehensive income. The large majority of South African employees, other than those employees required by legislation to be members of various industry funds, are members of the Imperial Group Pension Fund and the Imperial Group Provident Fund which are governed by the Pensions Funds Act, 1956.

	Total cost charged to the statement of comprehensive income				347	350
	Defined benefit plans
	Imperial Logistics International GmbH, a subsidiary located in Germany, operates a number of unfunded defined benefit plans for its employees in Europe. Under the plans the employees are entitled to retirement benefits which are dependent on seniority, length of service and level of pay.

	The benefit obligations in Europe are provided for based on actuarial valuations prepared using the projected unit credit method, with the following assumptions:
	– Discount rate				4,50%	6,00%
	– Projected pension payment increase				2,00%	2,25%
	– Projected salary and other contribution increase				2,00%	2,00%
	– Fluctuation rate (depends on the age of male or female)				0% – 8,00%	0% – 8,00%

	The latest actuarial valuation was performed in June 2010. In the opinion of the actuary, the provision for the defined benefit obligations is adequate. The next valuation will be conducted in June 2011.
	The amounts, included in staff costs, recognised in the statement of comprehensive income in respect of the plans are as follows:
	Current service cost				2	4
	Actuarial profit				(1)
	Expected return on plan assets				(1)	(1)
	Interest costs				13	15
					13	18
	The amount included in the statement of financial position arising from the group’s obligations is as follows:
	Unfunded obligations				222	256
	Movements in the liability in the current year were as follows:
	Balance at beginning of year				256	286
	Payments to retired employees				(9)	(14)
	Plan assets transfers				(3)
	Currency adjustments				(35)	(34)
	Amounts charged to income				13	18
	Balance at end of year				222	256

		2010	2009	2008	2007	2006
		Rm	Rm	Rm	Rm	Rm
	Present value of net liability of defined benefit obligation	246	232	269	226	219
	(Deficit) surplus	(24)	24	17	4	(1)
	Net liability recognised on the statement of financial position	222	256	286	230	218
	In addition the following net experience adjustments were incurred	(7)	1	(11)

					2010	2009
					Rm	Rm
22.	Interest-bearing borrowings
	Long-term
	–	Loans secured by mortgage bonds over fixed property			58	57
	–	Liabilities under capitalised finance leases			144	163
	–	Instalment sale creditors secured by assets			66	89
	–	Corporate bonds			6 448	7 301
	–	Listed on the Bond Exchange of South Africa
		–	Held at fair value – IC 02 – maturing in May 2012		522	510
		–	Held at amortised cost – IPL 3 – maturing in November 2010		1 008	1 007
		–	Held at amortised cost – IPL 4 – maturing in March 2014		1 530	1 528
		–	Held at amortised cost – IC 01 – maturing in August 2010		1 018	1 029
	–	Listed on the gilt edged and fixed interest market of the London Stock Exchange
		–	Held at amortised cost – Eurobond – maturing in April 2013		798	1 441
		–	Held at fair value – Eurobond – maturing in April 2013		1 572	1 786
		–	Unsecured loans		102	160
					6 818	7 770
	Short-term
	–	Unsecured loans, call borrowings and bank overdrafts			1 015	688
	–	Commercial paper				1 336
					1 015	2 024
	Total borrowings				7 833	9 794
	Less: Current portion of interest-bearing borrowings				3 124	2 139
	Long-term borrowings				4 709	7 655
	The above are categorised as follows:
	–	Designated as fair value through profit and loss			2 094	2 296
	–	Amortised cost			5 739	7 498
					7 833	9 794

	Interest rate analysis			Current year
				Effective rates
	Fixed
	–	Mortgage bonds, capitalised finance leases and instalment sale creditors		5,0 % – 12,0%	118	143
	–	Capitalised finance leases		16,0%	53	57
	–	Corporate bonds – IPL 3		10,1%	1 008	1 007
	–	Corporate bonds – IPL 4		9,0%	1 530	1 528
	–	Corporate bonds – IC 01		8,5%	1 018	1 029
	–	Eurobond		4,9%	798	1 441
	–	Unsecured loans		2,0% – 6,0%	110	154
	–	Unsecured loans		1,0% – 2,0%	51	125
	–	Unsecured loans		10,0% – 11,0%	2	7
	–	Commercial paper				1 336

	Variable linked
	–	Mortgage bonds, capitalised finance leases and instalment sale creditors		3,0% – 10,0%	98	110
	–	Corporate bond – IC 02		7,0% – 8,4%	522	510
	–	Eurobond		6,7% – 8,9%	1 572	1 786
	–	Unsecured loans		9,0% – 10,0%	57	51
	–	Unsecured loans		3,0% – 4,0%	9	13
	–	Unsecured loans		4,0% – 10,0%	392	324
	–	Call borrowings		6,8% – 9,9%	460	133
	–	Bank overdrafts		3,5% – 5,0%	35	40
					7 833	9 794
	See note 39 for interest rate swap arrangements.


	Capitalised finance leases			More than five years Rm	One to five years Rm	Less than one year Rm	2010 Rm	2009 Rm


	Total minimum lease payments			83	101	60	244	276
	Less: Amounts representing finance charges			58	26	16	100	113
	Present value of minimum lease payments			25	75	44	144	163

	Summary of long-term
	borrowings by currency	2015 and
	and year of redemption	onwards	2014	2013	2012	2011	2010	2009
	or repayment	Rm	Rm	Rm	Rm	Rm	Rm	Rm
	SA rand	4	1 565	16	580	2 729	4 894	5 865
	British pounds	21				53	74	139
	Euro	56	18	2 410	39	121	2 644	3 639
	Australian dollar					221	221	151
		81	1 583	2 426	619	3 124	7 833	9 794

					Debt secured		Net book value of assets encumbered

					2010	2009	2010	2009
	Details of encumbered assets				Rm	Rm	Rm	Rm
	Property, plant and equipment				147	138	100	102
	Transport fleet				956	902	1 747	1 204
	Vehicles for hire				706	809	1 373	1 198
	Inventories				221	151	235	169
					2 030	2 000	3 455	2 673
	The above totals include fleets financed through Imperial Capital Limited which has a security structure for the lenders to that entity.

							2010	2009
							Rm	Rm
	Borrowing facilities
	Total facilities established						7 744	11 420
	Less: Utilised for guarantees and letters of credit						40	54
							7 704	11 366
	Less: Total borrowings, excluding commercial paper issues, corporate bonds and loans from non-controlling interest						1 346	1 157
	Unutilised borrowing capacity						6 358	10 209
	In terms of the articles of association the borrowing powers of the group are unlimited.
23.	Insurance and investment contracts
	Long-term insurance funds						559	525
	Short-term insurance funds						534	831
							1 093	1 356
	See Annexure C for further details.
24.	Other non-current financial liabilities
	Cross currency and interest swap instruments						256	108
	Contingent consideration						39	49
	Loans						17
							312	157


		Leave pay	Bonuses	Insurance claims	Other	Total
		Rm	Rm	Rm	Rm	Rm
25.	Provisions for liabilities and other charges
	For the year ended 30 June 2010
	Balance at beginning of year	240	166	231	359	996
	Amounts raised	219	204	139	254	816
	Unused amounts reversed	(4)	(3)		(29)	(36)
	Charged to income	215	201	139	225	780
	Amounts utilised	(187)	(135)	(202)	(187)	(711)
	Net (disposals) acquisitions of subsidiaries and businesses	(4)			1	(3)
	Currency adjustments	(1)		(1)	(18)	(20)
	Balance at end of year	263	232	167	380	1 042
	Payable in less than one year					991
	Payable in one to five years					43
	Payable in more than five years					8
						1 042
	For the year ended 30 June 2009
	Balance at beginning of year	246	143	225	291	905
	Amounts raised	182	136	175	274	767
	Unused amounts reversed	(7)	(2)		(37)	(46)
	Charged to income	175	134	175	237	721
	Amounts utilised	(175)	(117)	(169)	(187)	(648)
	Net acquisitions of subsidiaries and businesses	7	7		44	58
	Currency adjustments	(13)	(1)		(26)	(40)
	Balance at end of year	240	166	231	359	996
	Payable in less than one year					908
	Payable in one to five years					22
	Payable in more than five years					66
						996

					2010	2009
					Rm	Rm
26.	Trade and other payables
	Trade payables and accruals			8 833		7 379
	Deferred income			1 129		844
	Derivative financial instruments			119		119
				10 081		8 342

27.	Revenue
	27.1		An analysis of the group’s revenue is as follows:
			Sales of goods	30 433		27 784
			Rendering of services	20 474		21 675
			Gross premiums received	2 471		2 667
			Other	60		93
				53 438		52 219
			Revenue includes:
	27.2		Intergroup revenue received by subsidiaries from the group’s associates and joint ventures
			– Sales of goods	72		72
			– Rendering of services	143		77
			– Gross premiums received			24
				215		173
			Revenue excludes:
	27.3		Revenue between subsidiaries
			– Sales of goods	1 428		779
			– Rendering of services	326		236
			– Gross premiums received	136		131
				1 890		1 146
28.	Net operating expenses
	Purchase of goods			27 836		24 115
	Changes in inventories, before acquisition and disposal of subsidiaries and businesses			(1 217)		850
	Cost of outside services			7 092		8 164
	Reinsurance, claims and premium costs			1 933		2 114
	Financial services – interest paid			6		8
	Staff costs			7 381		7 181
	Staff share-based payment			134		55
	Other operating income			(732)		(647)
	Other operating costs			6 338		6 614
				48 771		48 454
	The above costs includes
	Auditors’ remuneration
	– Audit fees			37		39
	– Consulting services			4		7
				41		46
	The above costs include:
	Rental and operating lease charges
	– Property			672		543
	– Plant and equipment			56		72
	– Vehicles			14		21
	– Transport fleet			83		85
	– Other			15		12
				840		733
	Additional lease charges contingent upon turnover
	– Property			2		59
	Net operating expenses include:
	Consultancy and other technical fees			22		38
	Impairment charge (impairment reversal) of assets other than goodwill and property			8		(8)
	Investment income			(214)		(290)
	Interest income			(195)		(266)
	Analysis of dividends received by investment type
	–		Fair value through profit and loss investments
		–	Designated	(19)		(1)
		–	Classified (held for trading)			(23)
	Analysis of fair value (gains) losses on investments
	–		Fair value (gains) losses through profit and loss	(97)		138
		–	Designated	(97)		12
		–	Classified (held for trading)			126

29.	Depreciation, amortisation and recoupments
	Intangible assets			49		49
	Property, plant and equipment			376		425
	Transport fleet			495		500
	Vehicles for hire			476		349
				1 396		1 323
	Loss on disposal of intangible assets			3
	Profit on disposal of plant and equipment			(1)
	Profit on disposal of transport fleet			(18)		(11)
	Profit on disposal of vehicles for hire			(1)
				1 379		1 312
	Recoupments from the sale of properties includes impairments			31
30.	Exceptional items
	Impairment of goodwill			(108)		(194)
	Profit on disposal of associate – Imperial Bank Limited			131
	Profit on disposal of other investments in associates and joint ventures			22
	Profit (loss) on disposal of investments in subsidiaries			13		(20)
	Loss on sale of Eqstra Holdings Limited shares					(217)
	Gross exceptional items			58		(431)
	Taxation expense			(147)
	Net exceptional items			(89)		(431)
	Attributable to non-controlling interest			(10)
	Attributable to Imperial Holdings’ shareholders			(99)		(431)

NOTES TO THE GROUP ANNUAL FINANCIAL STATEMENTS for the year ended 30 June 2010

21.

Retirement benefit obligations

22.

Interest-bearing borrowings

23.

Insurance and investment contracts

24.

Other non-current financial liabilities

25.

Provisions for liabilities and other charges

26.

Trade and other payables

Depreciation, amortisation and recoupments

Exceptional items