AFRICAN DAWN ANNUAL REPORT 2019 Notes to the Financial Statements continued Annual Financial Statements For the year ended 28 February 2019 90 Operating leases – as lessee (expense) Minimum lease payments due 2019 2018 - within one year 929 441 - in second to fifth year inclusive 797 189 1,726 630 36. Commitments Operating lease payments represent rentals payable by the Group for certain of its office properties. Leases are negotiated for an average term of three years with an option to extend. No contingent rent is payable. 37. Events after reporting period Directors Put Option Agreement On the 31 May the Group has entered into various put option agreements with the directors and Makalu Capital (“the Grantors”) where by the Group has the option to sell certain claims (“Option Claims”) to the Grantors before a period of 120 days. Should the Group decide to sell the Option Claims to the Grantors the amount payable (“the Option Consideration”) would be proportionately offset against loans provided by the directors (the Director Loans)(refer note 18) and Makalu Capital (“the Makalu Loan”). Should part of the Option Claims be collected before the Option Close Date the Option Consideration will be reduced by the amount collected. The transactions would be categorised once the Group decide to exercise the options and the required approvals would be obtained. The loans subject to the option had the following values as at 28 February 2019: G Hope R2,391,503, WJ Groenewald R428,000 and Makalu Capital R397,000, refer to Note 31. 38. Segment report The segment information has been prepared in accordance with IFRS 8 - Operating Segments which defines the requirements for the disclosure of financial information of an entity's operating segments. IFRS 8 requires segmentation based on the Group's internal organisation and reporting of revenue and operating income based upon internal accounting methods. The Group discloses its operating segments according to the components regularly reviewed by the chief operating decision-makers, being the executive directors. These amounts have been reconciled to the consolidated financial statements. The measures reported by the Group are in accordance with the accounting policies adopted for preparing and presenting the consolidated financial statements. Segment revenue excludes value added taxation and includes inter- segment revenue which is Rnil (2018: 0,192). Net revenue represents segment revenue from which intersegment revenue has been eliminated. Sales between segments are made on a commercial basis. Segment operating profit before capital items represents segment revenue less segment expenses. Segment expenses consist of operating expenses, depreciation, amortisation and impairments have been allocated to the segments to which they relate. The segment assets comprise all assets of the different segments that are employed by the segment and that are either directly attributable to the segment, or can be allocated to the segment on a reasonable basis. The Group's reportable segments are based on the following lines of business: a. Investment advisory and investment management This segment consists of the YueDiligence. YueDiligence provides investment advisory and investment management services to entrepreneurial and innovative companies. Knife Capital and Grindstone were sold during 2018, so transactions related to these entities are treated as discontinued operations in the prior year. b. Micro finance This segment consists of Elite and Elite Two. These companies are involved in micro finance in the unsecured lending industry and have a wide base of customers (mostly individuals). c. Rentals of properties in possession
AFDAWN AR FINAL 2019
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