Integrated Reports Senwesbel Consolidated Financial Statements 2018 - Page 41

15.2 DEFERRED TAX (LIABILITY)/ASSET (Continued) The deferred tax asset and liability is disclosed in the statement of financial position as follows: GROUP COMPANY 2018 R’m 2017 R’m 2018 R’m 2017 R’m 31 11 - - Deferred tax liability (252) (204) (108) (95) Deferred tax (liability)/asset (221) (193) (108) (95) Deferred tax asset GROUP COMPANY 2018 R’m 2017 R’m 2018 R’m 2017 R’m (193) (180) (95) (97) (28) (13) (13) 2 (221) (193) (108) (95) Reconciliation of deferred tax balance: Balance at the beginning of the year Temporary differences - movements during the year Balance at the end of the year 15.3 RECONCILIATION OF THE TAX RATE GROUP COMPANY 2018 R’m 2017 R’m 2018 R’m 2017 R’m 28,0 28,0 28,0 28,0 Non-taxable income (dividends, accounting profits, impairment reversals) (0,1) (1,1) (27,3) (32,2) Other incentive allowances (0,4) (0,1) - - 1,0 0,5 2,6 4,2 Prior year adjustment (0,6) (0,1) - - Effective tax rate 27,9 27,2 3,3 - Standard tax rate Adjusted for: Non-deductable expenses (capital expenditure, donations, JV profits or losses) 16. PROVISIONS GROUP NOTES Balance as at 30 April 2016 AGRIREWARDS R’m GRAIN RISK R’m TOTAL R’m - 17 Increase in provision during the year 8 (14) (6) Balance as at 30 April 2017 8 3 11 Increase in provision during the year Transferred to other financial liability Balance as at 30 April 2018 4.2.5 17 - 3 3 (8) - (8) - 6 6 16.1 GRAIN RISKS The group is exposed to risks in the grain industry, which include the physical risk of holding inventory and non-compliance with grain contracts by counter-parties. Estimates for these risks are based on potential shortfalls and non-compliance with contracts at current market prices. 16.2 AGRIREWARDS AgriRewards is a deferred bonus scheme in terms of which Senwes will allocate a portion of its profits on an annual basis to customers to reward them for their loyalty during the year. The AgriRewards scheme was launched during August 2016. During April 2017 the board approved a credit of R54/ton for all registered customer deliveries. The accumalated expense was reclassified to note 4.2.5 for the year ended April 2018. Senwesbel Limited Reg no: 1996/017629/06 SENWESBEL ANNUAL FINANCIAL STATEMENTS 2018 40