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AFRICAN DAWN ANNUAL REPORT 2020

Notes to the Financial Statements continued
Annual Financial Statements For the year ended 29 February 2020

14. Loans from directors

Group Company
2020 2019 2020 2019
R’000 R’000 R’000 R’000
WJ Groenewald ** # - 428 - 428
G Hope ** # 626 2,392 626 2,392
626 2,820 626 2,820

Non-current liabilities - - - -
Current liabilities (626) (2,820) (626) (2,820)
(626) (2,820) (626) (2,820)

** All loans accrue interest @15% per annum are unsecured and are repaid on demand.
# The directors exercised the put option linked to their loans on the 19 February 2020. Trade receivables of R2,3 million from subsidiary African
Dawn Property Transfer Finance 2 (Pty) Ltd and R1,3 million from subsidiary African Dawn Property Transfer Finance 1 (Pty) Ltd were transferred
to African Dawn Capital via their outstanding group loans and the rights to the Trade receivables were transferred to the directors to offset their
loans to the value of R3,3 million being the outstanding balances. The directors have subsequently advanced additional funds which are unsecured
and interest free. African Dawn no longer carries any credit risk relating to the debtors transferred to the directors in settlement of the loan and is
no longer involved in recovering the debt.

15. Leases liability/Operating lease liability
The Group has leases for several premises in commercial areas. With the exception of short-term leases and leases of low-value underlying assets,
each lease is reflected on the statement of financial position as a right-of-use asset and a lease liability. The Group classifies its right-of-use
assets in a consistent manner to its property, plant and equipment.

Each lease generally imposes a restriction that, unless there is a contractual right for the Group to sublet the asset to another party, the right-
of-use asset can only be used by the Group. Leases are either non-cancellable or may only be cancelled by incurring a substantive termination
fee. Some leases contain an option to extend the lease for a further term. The Group is prohibited from selling or pledging the underlying leased
assets as security. For leases of premises the Group must keep those properties in a good state of repair and return the properties in their original
condition at the end of the lease. Further, the Group must incur maintenance costs on certain items in accordance with the lease contracts, in
addition some of the leases include a month to month commitment to pay water, electricity and parking.
The right-of-use assets are included in the same line item as where the corresponding underlying assets would be presented if they were owned.
Refer to note 1.2.
Reconciliation of lease movement:

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