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| Principal accounting policies (continued) |
| Changes in accounting policy |
| Stores and materials |
| During the year, the Group changed its accounting policy of valuing stores and material at average cost. Stores and materials are
now valued at cost on a first-in first-out (FIFO) basis. The change in accounting policy is due to the alignment of the Group's
accounting policies with the accounting policies of the holding company of the Group. The impact of this change is immaterial on
the profit or loss for the year. |
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| Leased metal |
| In prior years, the Group measured the liability and associated costs arising on metal leased to fulfil marketing commitments at the
equivalent cost of production at the inception date of the lease. In the current year, the Group changed its accounting policy for
leased metal and now reflects the costs and corresponding liability at the market value of the metal at the inception date of the
lease. (Refer to accounting policy 15) |
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| Existing accounting policies |
| 1. |
Consolidation |
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The consolidated financial statements include the results and financial position of Anglo Platinum Limited, its subsidiaries, joint ventures and associates. Subsidiaries are entities in respect of which the Group has the power to govern the financial and operating policies so as to obtain benefits from its activities. The results of any subsidiaries acquired or disposed of during the year are included from the date control was acquired and up to the date control ceased to exist. Where an acquisition of a subsidiary is made during the financial year, any excess or deficit of the purchase price compared to the fair value of the attributable net identifiable assets is recognised respectively as goodwill or as part of profit and accounted for as described in the goodwill accounting policy.
All intra-group transactions and balances are eliminated on consolidation. Unrealised profits that arise between Group entities are also eliminated.
For non-wholly-owned subsidiaries, a share of the net assets and profit for the financial year is attributed to the minority interest. Any losses applicable to minority interests in excess of the minority’s interest are allocated against the interests of the parent, except to the extent that the minorities have a binding obligation and financial ability to cover losses. |
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| 2. |
Investment in associates |
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An associate is an entity over which the Group exercises significant influence but which it does not control, through participation in the financial and operating policy decisions of the investee. These investments are accounted for using the equity method, except when the investment is classified as held for sale, in which case it is accounted for under IFRS 5 – Noncurrent Assets Held for Sale and Discontinued Operations.
Equity accounting involves recognising in the income statement the Group’s share of the associates’ profit or loss for the period. The carrying amount of the investment in an associate in the balance sheet represents the Group’s share of the net assets, including goodwill arising on acquisition. This comprises the initial investment at cost, plus the attributable share of investments in net assets less dividends paid. Adjustments for impairment are recorded when they occur. |
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| 3. |
Joint ventures |
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A joint venture is an entity in which the Group holds a long-term interest and shares joint control over the strategic, financial and operating decisions with one or more other venturers under a contractual agreement. The Group’s interest in jointly controlled entities is accounted for through proportionate consolidation.
Under this method the Group includes its share of the joint ventures’ individual income and expenses, assets and liabilities in the relevant components of its financial statements on a line-by-line basis. Where a Group company undertakes its activities under a joint venture arrangement directly, the Group’s share of jointly controlled assets and any liabilities incurred jointly with other venturers is recognised in the financial statements of the relevant company and classified according to their nature. Liabilities and expenses incurred directly in respect of interests in jointly controlled assets are accounted for on an accrual basis. Income from the sale or use of the Group’s share of the output of jointly controlled assets is recognised when the revenue recognition criteria are met. |
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| 4. |
Goodwill |
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Goodwill arising on the acquisition of a subsidiary or a jointly controlled entity represents the excess of the cost of acquisition over the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the subsidiary or jointly controlled entity recognised at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less any accumulated impairment losses. Goodwill is not amortised.
Goodwill is tested for impairment annually and an impairment loss recognised is not reversed in a subsequent period. On disposal of a subsidiary or a jointly controlled entity, the attributable amount of goodwill is included in the determination of the profit or loss on disposal.
To the extent that the fair value of the net identifiable assets of the subsidiary or jointly controlled entity acquired exceed the cost of acquisition, the excess is credited to profit or loss for the period. |
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| 5. |
Property, plant and equipment |
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Mining |
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Mining development and infrastructure costs are capitalised to capital work-in-progress and transferred to mining property, plant and equipment when the mining venture reaches commercial production.
Capitalised mining development and infrastructure costs include expenditure incurred to develop new mining operations and to expand the capacity of the mine. Costs include interest capitalised during the construction period where qualifying expenditure is financed by borrowings and the discounted amount of future decommissioning costs. Capitalised development costs are amortised on a UOP basis.
Items of mining property, plant and equipment, excluding mining development and infrastructure assets, are amortised on a straight-line basis over their expected useful lives. Amortisation is first charged on mining assets from the date on which they are ready for use.
Items of property, plant and equipment that are withdrawn from use, or have no reasonable prospect of being recovered through use or sale, are regularly identified and written off.
Residual values and useful economic lives are reviewed at least annually, and adjusted if appropriate, at each balance sheet date. Revenue derived during the project phase is recognised in the income statement and an appropriate amount of development cost is charged against it.
With respect to open pit operations, stripping cost incurred to the extent that it exceeds the expected life-of-pit stripping ratio is deferred. In cases where the in-period stripping ratio is below the expected life-of-pit ratios, then an appropriate amount of deferred cost is written off. |
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Non-mining |
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Non-mining assets are carried at historical cost less accumulated depreciation.
Depreciation is charged on the straight-line basis over the useful lives of these assets.
Residual values and useful economic lives are reviewed at least annually, and adjusted if appropriate, at each balance sheet date. |
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Impairment |
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An impairment review of property, plant and equipment is carried out annually by comparing the carrying amount thereof
to its recoverable amount. The Group's operations as a whole constitute the smallest cash-generating unit. The recoverable
amount thereof is the Group's market capitalisation adjusted for the carrying amounts of financial assets that are tested for
impairment separately.
Where the recoverable amount is less than the carrying amount, the impairment charge is included in other net expenditure
in order to reduce the carrying amount of property, plant and equipment to its recoverable amount. The adjusted carrying
amount is amortised on a straight-line basis over the remaining useful life of property, plant and equipment. |
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| 6. |
Non-current assets held for sale |
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Non-current assets and disposal groups are classified as held for sale if the carrying amount of these assets will be recovered
principally through a sale transaction rather than through continued use. This condition will only be regarded as met if the sale
transaction is highly probable and the asset (or disposal group) is available for sale in its present condition. Furthermore, for the
sale to be highly probable management must be committed to the plan to sell the asset (or disposal group) and the transaction
should be expected to qualify for recognition as a completed sale within 12 months from date of classification.
Non-current assets (or disposal groups) held for sale are measured at the lower of their previous carrying amounts and their
fair value less costs to sell. |
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| 7. |
Leases |
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A finance lease transfers substantially all the risks and rewards of ownership of an asset to the Group.
Assets subject to finance leases are capitalised as property, plant and equipment at fair value of the leased asset at inception
of the lease, with the related lease obligation recognised at the same amount. Capitalised leased assets are depreciated over
their estimated useful lives.
Finance lease payments are allocated between finance cost and the capital repayment, using the effective interest rate method.
Minimum lease payments on operating leases are charged against operating profit on a straight-line basis over the lease term. |
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| 8. |
Investments |
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Investments in subsidiaries are reflected at cost. |
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