2020 INTEGRATED REPORT

GROUP ACCOUNTING POLICIES The principal accounting policies applied are set out below. 1. BASIS OF PREPARATION These financial statements are prepared in accordance with International Financial Reporting Standards (“IFRS”). The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in note 35. All monetary information and figures presented in these financial statements are stated in millions of Rand (R’m), unless otherwise indicated. The following amendments to standards have application of 1 January 2020: ~ IFRS 3, 'Business combinations’ ~ IAS 1, ‘Presentation of financial statements’ ~ IAS 8, ‘Accounting policies, changes in accounting estimates and errors’ ~ IFRS 9, ‘Financial Instruments’ ~ IAS 39, ‘Financial Instruments: Recognition and Measurement’ ~ IFRS 7, ‘Financial Instruments: Disclosure’ These do not have a material impact on the Group’s overall results and financial position. Standards, amendments and interpretations to existing standards that are not yet effective and have not been early adopted by the Group: ~ IFRS 16, “Leases” Covid-19-Related Rent Concessions Amendment (effective for annual periods beginning on or after 30 June 2020): The amendments will not result in a material impact on the Group’s financial statements. ~ Amendments to IFRS 9 ‘Financial Instruments’, IAS 39 ‘Financial Instruments: Recognition and Measurement’, IFRS 7 ‘Financial Instruments: Disclosures’, IFRS 4 ‘Insurance Contracts’ and IFRS 16 ‘Leases’ – interest rate benchmark (IBOR) reform (Phase 2) (effective for annual periods beginning on or after 1 January 2021): The Phase 2 amendments address issues that arise from the implementation of the reform of an interest rate benchmark, including the replacement of one benchmark with an alternative one. The amendments will not result in a material impact on the Group’s financial statements. ~ Amendment to IAS 1 ‘Presentation of Financial Statements’ on Classification of Liabilities as Current or Non-current (effective for annual periods beginning on or after 1 January 2022): The amendment clarifies that liabilities are classified as either current or non-current, depending on the rights that exist at the end of the reporting period. Classification is unaffected by expectations of the entity or events after the reporting date. The amendment will not result in a material impact on the Group’s financial statements. ~ Amendment to IFRS 3, ‘Business combinations’ (effective for annual periods on or after 1 January 2022): The International Accounting Standards Board (‘IASB’) has updated IFRS 3 to refer to the 2018 Conceptual Framework for Financial Reporting, in order to determine what constitutes an asset or a liability in a business combination. In addition, the IASB added a new exception in IFRS 3 for liabilities and contingent liabilities. The exception specifies that, for some types of liabilities and contingent liabilities, an entity applying IFRS 3 should instead refer to IAS 37, ‘Provisions, Contingent Liabilities and Contingent Assets’, or IFRIC 21, ‘Levies’, rather than the 2018 Conceptual Framework. The IASB has also clarified that the acquirer should not recognise contingent assets, as defined in IAS 37, at the acquisition date. The amendment will not result in a material impact on the Group’s financial statements. 128 | PPS INTEGRATED REPORT 2020