Imara 2013 annual report

Annual Report2013

The name Imara means ‘strong’ in Swahili, the language spoken by more than 130 million people living and working across Africa.

We chose this name for our Company because it reflects our African roots as well as the stability, persistence and endurance of our approach to wealth management. These qualities are proudly reflected in our Company motto: ‘strong in name, resolute by nature’.

As an investment banking Group with a uniquely African heritage, Imara has adopted a remarkable and typically African creature for our emblem. The scarab is small yet highly industrious.

Capable of carrying more than 800 times its body weight, it is one of the world’s strongest animals. It also plays an important role in maintaining a healthy and thriving ecosystem by improving soil fertility and forage growth.

Like the scarab, Imara accelerates the prosperity of the continent by offering a full range of financial products and solutions for institutional, corporate and high net worth clients investing in Africa.

CONTENTS

Vision, Purpose and Core Values

International Footprint And Regional Offices

Divisional Structure

Group Organisational Structure

Group Profile

Directorate and Group Management

Chairman’s Statement

Chief Executive Officer’s Review of Operations

Corporate Governance Report

Imara’s Corporate Social Investment Initiative Update

Glossary

Five-Year Financial Highlights and Ratios

Graphical Five-Year Financial Highlights and Ratios

Independent Auditor’s Report

Consolidated Statement of Comprehensive Income

Consolidated Statement of Financial Position

Consolidated Statement of Cash Flows

Consolidated Statement of Changes In Equity

Notes to the Consolidated Financial Statements

Shareholder Information

Notice of Annual General Meeting

Form of Proxy

1

3

4

5

9

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15

19

31

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51

113

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118

VISION, PURPOSE AND CORE VALUES

VISION

“A Successful Africa.”

We are Africans, confident in the future of Africa.

We view Africa as the continent of opportunity and are passionate about its potential.

We believe that Africa’s influence will grow as its economies continue to develop.

We understand African markets and know how to harness their unique investment opportunities.

PURPOSE

“To Accelerate the Prosperity of Africa.”

We believe the key to unlocking Africa’s success is through economic growth and prosperity.

As a leading investment banking Group, we facilitate growth by offering a full range of financial products and solutions for institutional, corporate and high net worth clients investing in Africa.

CORE VALUES

Integrity

We are honest, ethical and transparent in our dealings with clients, our investors and with each other.

We demonstrate genuine structural integrity being unified in operation, sound in construction and robust in our management of risk and compliance.

Knowledge

With over 50 years of operation in Africa, we are equipped with an unrivalled reserve of expertise and experience.

We use this wealth of understanding to advise and invest more astutely than our competitors.

We make sure our clients benefit from our in-depth research.

We are uniquely qualified to develop African solutions for Africa.

Discipline

Discipline governs the processes through which we control and conduct business;it transforms our knowledge and competence into results.

We focus our efforts through efficient and reliable systems.

We promote a culture of ownership and accountability.

Enterprise

We believe enterprise is the combination of initiative and resourcefulness that fuels economic development.

We encourage African entrepreneurship to create prosperity in Africa.

We develop dynamic and innovative investment solutions.

Resoluteness

We believe resoluteness is the quality of being purposeful, determined and unwavering.

To be resolute is to be focused and committed, both attributes to which we aspire.

Our own strong character helps us to fulfil our purpose and concentrate on achieving our goals.

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INTERNATIONAL FOOTPRINT AND REGIONAL OFFICES

Namibia

Windhoek +264 61 25 6666

Angola

Luanda +244 222 372 029

Nigeria

Lagos +234 1 461 0691

Kenya

Nairobi +254 2034 2756

South Africa

Johannesburg +27 11 550 6100

Mauritius

Mauritius +230 464 9799

Zambia

Lusaka +260 211 232 456

Botswana

Gaborone +267 318 8710

Scotland

Edinburgh +44 131 550 3737

Malawi

Blantyre +265 1 822 803

Zimbabwe

Harare +263 4 790 090

SOUTH AFRICA

ANGOLA

NAMIBIABOTSWANA

ZAMBIA

MALAWI

KENYANIGERIA

OFFICES (including Associates, Partners and Representatives)

SCOTLAND

ZIMBABWEMAURITIUS

4PAGE |

DIVISIONAL STRUCTURE

Imara Group

Asset Management

Imara Asset Management Limited

* BVI

Imara Asset Management UK Limited

*United Kingdom

Imara Asset Management

(Mauritius) Limited

*Mauritius


South Africa (Pty) Ltd

*South Africa

Imara Asset Management (Pty) Limited

(Dormant)

*Botswana

Imara Corporate Finance South Africa (Pty) Ltd

*South Africa

Imara Botswana Limited

*Botswana

Imara S P Reid (Pty) Ltd

*South Africa

Imara Africa Securities (Pty) Limited

*Botswana

Imara Capital Securities (Pty) Ltd

*Botswana

Imara Securities Angola SVM Limitada

(Dormant)

*Angola

Stockbrokers Malawi Limited

*Malawi

Africa Investments Limited

*BVI

Imara Holdings Limited

* Botswana

Imara Capital South Africa (Pty) Ltd

*South Africa

Imara Capital Limited

(Dormant)

*Botswana

C F Africa Limited

*BVI

Imara Trademarks Limited

*BVI


*BVI

Imara CapitalKenya Limited

(Dormant)

*Kenya

Imara CapitalLimited Zambia

*Zambia

Imara Capital Botswana (Pty) Ltd

*Botswana

Corporate Finance Stockbroking Trust Administration

Imara Asset Management (Pvt) Limited

*Zimbabwe

Imara Corporate Finance (Pvt) Limited

*Zimbabwe

Associate

Imara Beresford International Limited

*Mauritius

Imara Edwards Securities (Pvt) Limited

*Zimbabwe

Stockbrokers Zambia Limited

*ZambiaAssociate

Africa Private Equity Fund Managers (Pty) Ltd

*Botswana

Imara Capital Zimbabwe (Pvt) Limited

*Zimbabwe

Legend

Active Trading Company

Investment Holding or Group Parent Company

Dormant or Non Trading Company

*Country of Registration

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Group ORGANISATIONAL STRUCTURE


Africa Investments

Limited


UK Limited


Limited

*BVI

Imara Corporate Finance


Imara Capital South Africa

(Pty) Ltd

Imara South Africa

Trust

Imara SP Reid (Pty) Ltd

(Stockbroking)

Imara Asset Management South Africa

(Pty) Ltd


*BVI



C F AfricaLimited

*BVI

Imara Trademarks

Limited

*BVI

Imara Beresford International

Limited


Mauritius (Pty)Limited

Imara Capital LimitedZambia

Non Trading Companies

Imara Africa Securities (Pty)

Limited(Dormant)


Imara CapitalLimited

(Dormant)

Imara Asset Management (Pty) Limited(Dormant)

ManagementContracts

Imara African Opportunities

Fund

Imara Global Fund

Imara Africa Series Fund

ImaraCapital Securities

(Pty) Limited

Imara Capital Zimbabwe

(Pvt) Limited

Beresford Trust and Corporate

Services


Imara Edwards Securities

(Pvt) Limited

Beresford OneLimited

Imara Nominees

Limited

Beresford TwoLimited

Imara Corporate Finance Zimbabwe

(Pvt) Limited

Imara Trust Company

(Mauritius)Limited



Imara Securities Angola

SVM Limitada

Imara TwoLimited

Imara Directors

Limited


93.75% 100% 100% 100% 100% 100%

100%

100%

100%

100%

50.10%

50%

100% 100% 100%51% 50%25%

Sub Funds:• Zimbabwe Fund• Nigeria Fund• East Africa Fund• African Resources Fund

100%

6.25%

46,35%100%

100% 100% 100%

25%

Group holding company, incorporated in Botswana and a registered International Financial Services Company (Offshore Investment Status)

Legend

Botswana

South Africa

British Virgin Islands

Zimbabwe

Malawi

Kenya

Angola

United Kingdom

Zambia

Mauritius

100%

50%

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Africa Investments

Limited


UK Limited


Limited

*BVI

Imara Corporate Finance


Imara Capital South Africa

(Pty) Ltd

Imara South Africa

Trust

Imara SP Reid (Pty) Ltd

(Stockbroking)

Imara Asset Management South Africa

(Pty) Ltd


*BVI



C F AfricaLimited

*BVI

Imara Trademarks

Limited

*BVI

Imara Beresford International

Limited


Mauritius (Pty)Limited

Imara Capital LimitedZambia

Non Trading Companies

Imara Africa Securities (Pty)

Limited(Dormant)


Imara CapitalLimited

(Dormant)

Imara Asset Management (Pty) Limited(Dormant)

ManagementContracts

Imara African Opportunities

Fund

Imara Global Fund

Imara Africa Series Fund

ImaraCapital Securities

(Pty) Limited

Imara Capital Zimbabwe

(Pvt) Limited

Beresford Trust and Corporate

Services


Imara Edwards Securities

(Pvt) Limited

Beresford OneLimited

Imara Nominees

Limited

Beresford TwoLimited

Imara Corporate Finance Zimbabwe

(Pvt) Limited

Imara Trust Company

(Mauritius)Limited



Imara Securities Angola

SVM Limitada

Imara TwoLimited

Imara Directors

Limited


93.75% 100% 100% 100% 100% 100%

100%

100%

100%

100%

50.10%

50%

100% 100% 100%51% 50%25%

Sub Funds:• Zimbabwe Fund• Nigeria Fund• East Africa Fund• African Resources Fund

100%

6.25%

46,35%100%

100% 100% 100%

25%

Group holding company, incorporated in Botswana and a registered International Financial Services Company (Offshore Investment Status)

Legend

Botswana

South Africa


Zimbabwe

Malawi

Kenya

Angola

United Kingdom

Zambia

Mauritius

100%

50%

Mkuze Zululand

A full moon rises over the Mkuze Village in the northern Zululand river region. The Mkuze River itself flows along the southern border of the community owned game reserve. This reserve, called Somkhanda, comprises 16,000 hectares of forest, grasslands and savannah. Under the full force of the ethereal lunar light, game rangers and anti-poaching units are on high alert – the full moon is also known as a poacher’s moon. The threat of extinction to endangered game is but one issue affecting regions like Somkhanda. Groups like the Wildlife ACT Fund have helped identify aspects of the human ecology that need attention. When rapidly expanding tribal communities, such as the Gumbi, are prevented from accessing protected areas they cannot be expected (with inadequate conservation education) to sustainably address issues such as food security. As a result, they tend to look towards protected resources as a means of survival, and the demand for bush meat escalates. Poachers cross into local game reserves and hunt any animal that their dogs can catch.

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GROUP PROFILE

General Information

Country of incorporation Botswana

Principal activities Holding Company for a Pan-African Financial Services Group

Company registration number CO - 2002/3377

Tax registration number CO - 65018-0101-9

Registered office Union Provident Trust First Floor, Times Square Plot 134, Independance Avenue, Gaborone, Botswana P.O. Box 46699, Village, Gaborone

Registration status: Registered in the Botswana International Financial Services Centre (IFSC) Tax Certificate Number 22 - Effective date 28 July 2003

Independent auditors Ernst & Young (EY)

Bankers Barclays Bank of Botswana Barclays Bank of Mauritius First National Bank Limited (Botswana) First National Bank Limited (South Africa) Standard Bank Limited (Mauritius)

Botswana Stock Exchange code IMARAReuters code IMRA.BT

Transfer secretaries Corpserve Botswana Unit 206, Second Floor, Plot 64516, Showgrounds Close, Fairgrounds, Gaborone Telephone: +267 393 2244, Facsimile: +267 393 2243 email: [email protected]

Business addresses & contact details Botswana: Unit 6, Second Floor, Morojwa Mews, Plot 74770, Western Commercial Road, New Central Business District, Gaborone. Telephone: +267 3188 710, Facsimile: +267 3191 767 Website: www.imara.com

South Africa Imara House, Block 3 257 Oxford Road, Illovo 2116, Johannesburg Telephone: +27 11 550 6100, Facsimile: +27 11 550 6110

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DIRECTORATE AND GROUP MANAGEMENT

Directorate

Imara Holdings Limited SM Ndoro Chairman Non-executive Zimbabwe MJS Tunmer Chief Executive Executive Zimbabwe AR Fleming Non-executive British GE Johns Non-executive Botswana JR Legat Executive British ACH Mackeurtan Executive South Africa RH Macleod Executive South Africa TJ Matsau Non-executive South Africa GZ Steffens Lead Independent director Non-executive German DE Stone Executive South Africa

Company SecretaryDE Stone

Botswana Stock Exchange Compliance Officer:DE Stone

Audit CommitteeGZ Steffens Chairman Non-executiveGE Johns Non-executiveTJ Matsau Non-executiveSM Ndoro By invitation Non-executiveDE Stone By invitation Executive

Remuneration CommitteeGE Johns Chairman Non -executiveTJ Matsau Non-executiveSM Ndoro Non-executiveMJS Tunmer By invitation ExecutiveACH Mackeurtan By Invitation Executive

Nominations CommitteeSM Ndoro Chairman Non-executiveGE Johns Non-executiveACH Mackeurtan ExecutiveMJS Tunmer

Social & Ethics Committee (South Africa)TJ Matsau Chairman Non-executiveB Jena ExecutiveR Macleod ExecutiveL Warburton ExecutiveMJS Tunmer By invitation ExecutiveDE Stone By invitation Executive

Management

MJS Tunmer Chief Executive OfficerDE Stone Chief Financial OfficerJR Legat Head: Asset Management RH Macleod Head: Corporate FinanceMJS Tunmer Head: Stockbroking P Prayag Head: Trust Administration & Custodial Services

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CHAIRMAN’S STATEMENT

Overview

Group results for the year ended 30 April 2013 are in some ways positive but in other ways negative; positive in that the Group reported a profit before tax for the year of P3.48 million; that the earnings performance in the second half of the year was strong with profit before tax of P7.66 million and positive in that total assets for the Group increased by more than 26%. Negative because of a seemingly abnormally high tax charge and the resultant loss for the year, and more significantly, that the earnings performance continues to be below expectations. For the half year to 31 October 2012, the Group reported a loss after tax of P5.12 million and a total comprehensive loss of P7.63 million. Albeit that the Group`s earnings performance tends to be stronger in the second half of the year, up until late in the financial year, indications were that a loss higher than what was finally achieved, would be reported. The better than expected pre-tax performance was mainly due to the outstanding performance of the asset management division in the final quarter of the year where funds under management increased significantly and performance fees were earned on certain of the Imara Funds. Impairment charges against receivables and the carrying cost of investments in associate companies added almost P3.8 million to total expenses for the year, and costs relating to the on-going NBS arbitration process a further P2.5 million.

Group Financial Review

Imara Beresford International Limited, the Mauritius based Company engaged in trust, administration and custodial business became a subsidiary Company on 31 October 2012. This followed the acquisition of an additional 10.99% equity stake which increased the Group’s equity holding to 51%. This Company has contributed positively to Group earnings both as an associate Company, prior to

October 2012, and subsequently as a subsidiary Company.

The financial results for Imara Capital Zimbabwe (Private) Limited, which became a subsidiary Company on 30 November 2011 in the previous financial year, are included for a full year in April 2013 as opposed to the seven months in the previous financial period. This entity has also reported significantly improved earnings for the year on the back of sound performances by its asset management and securities trading businesses.

The inclusion of these entities as subsidiary companies distorts to some degree the comparative financial information and detracts from a direct year on year comparison.

Associate companies contributed P1.09 million to Group earnings for the year but impairment charges of P1.29 million in respect of the Malawian and Zambian entities, resulted in a net loss from associate companies of some P200 000.

All divisions, with the exception of the corporate finance division, were profitable for the year. Asset management continues to be the principle contributor to Group earnings and cash flow and its results for the year have been boosted by a P3.2 million gain on available-for-sale-financial assets. Results for the stockbroking division, although up on the previous year, are somewhat disappointing as brokerage rates across the region continue to be under pressure.

The establishment of the Africa Trading Desk in Johannesburg has diversified the division`s earnings stream allowing it to gain new ground in the institutional investor base as well as more recently, entry into the retail stockbroking sector

Nguni cattle vs wildlife

The sun goes down on the sacred cow both literally and metaphorically. Although this beast cuts a lonely, albeit beautiful, figure he is in abundant Company. In the Somkhanda region, the cattle and wildlife are in constant conflict over space and grazing. The demand for food and wealth for a growing human population causes a corresponding increase in the number of cattle. Overgrazing in the tribal lands adjoined to the reserves means an ever-diminishing availability of lush grassland. As tracts of the land become untenable as sustenance for the cattle, barren landscapes become a feature of the area, and herdsman start to eye the verdant herb on the other side of the fence. On the reserves, techniques are employed by strict game management that ensure against over grazing.

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CHAIRMAN’S STATEMENT

for Africa excluding South Africa. The Zimbabwe Stock Exchange was particularly robust during the period from 1 January 2013 to 30 April 2013 and the all share index reflected an increase of 24.45% during this period. The securities trading business in Zimbabwe was a benefactor of this performance and reported particularly good results for the past year.

The tax charge for the year of P4.98 million, (equivalent to an effective rate of 143.4%) appears abnormally high in relation to profitability and continues to reflect the abnormalities of the Group structure, tax legislation affecting the Group across different jurisdictions and the requirement for asset management and stockbroking entities, in particular, to be stand-alone and ring fenced entities for regulatory purposes. On a Group wide basis this inhibits the ability to offset taxable profits in one entity against losses in another. Of the current year tax charge, almost P2.0 million relates to deferred tax reversals from previous years.

Outlook

The Board continues to hold the view that African capital markets remain attractive to investors, offering upside potential for the Group. Group performance in the second half of the financial year adds credence to this view. World markets however remain volatile with the potential to impact negatively on future results.

Zimbabwe represents an important business centre for the Imara Group. Since the publication of the Announcement of Audited Results on 26 July 2013, President RG Mugabe has been re-elected as President of Zimbabwe for a further 5 years with and increased parliamentary majority for his ZANU PF party.

It is still too early to assess what impact future economic and investment policies in Zimbabwe may have on the Imara Group. Short term fluctuations do not overly concern the Board which continues to see positive opportunities for Imara’s business in Zimbabwe over the medium to long term.

SM Ndoro3rd September, 2013

Zulu shepard boy

The Zulu Empire had already greatly expanded what was a modest kingdom out through the wildlands and hilly savannas of sub-tropical Southern Africa before fierce contact with, and eventual succession to colonising Europe. Today, a repatriated KwaZulu-Natal stretches its provincial Eastern flank along a fluid border of deliciously warm Indian Ocean waters, from Port Edward to Mozambique. 21st century ‘Zululand’s’ interior is one of verdant ecological diversity and abounds with wildlife reserves. Some of the reclaimed tribal lands that abut these reserves present environmental sustainability and empowerment challenges. Whereas historically Zululand has been the scene of many consecrated battles, both internecine and international, these days the main threat is to the environment. Due to population increases and unsustainable subsistence practices, the topographical carrying capacity of the regions around the reserves is being stretched to the limit. When tribal communities join forces with initiatives that promote awareness and strategic implementation of modern conservation techniques, the future for children in tribes like the Gumbi looks brighter.

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CHIEF EXECUTIVE OFFICER’S REVIEW OF OPERATIONS

Group Review

The performance of your Group in the year ended 30 April 2013 was generally disappointing despite some highlights. Market conditions remained difficult although there was an increase in liquidity, while most markets registered positive gains. The performance of the African markets excluding South Africa, was better with eleven closing the year under review in positive territory in US$ terms. Of the larger markets Nigeria was up 49%, Kenya 34% and Zimbabwe 47% while Egypt was down 8% and Morocco 12%. As usual the Group performed better in the second half against a continuing slowdown in China and the Eurozone problems although on the positive side there are signs of a turnaround in the USA.

All divisions besides corporate finance delivered profits. The performance of the associates was mixed with Malawi returning a profit and Zambia a loss. Imara Beresford, which was accounted for as an associate until 31 October 2012, contributed P660,000 to the share of associate profits, before it became a subsidiary. The overall contribution from associates was negative by some P200,000 due to impairments. Zimbabwe, which was accounted for as a subsidiary for the full year, for the first time, made a positive contribution. Group profit before tax was P3.48 million but an abnormally high tax charge reduced this to a loss of P1.5 million after tax. Revenue grew by 19% and total expenditure by 32%. Costs were distorted by the inclusion of Zimbabwe as a subsidiary for the full year and Imara Beresford for six months. Cash flow was negative with a net outflow of P14.69 million during the year, although the trend was more positive in the second half. The Group’s “free” cash position remains strong with no debt held by the Group.

The Asset Management division remained the star performer. Funds under management of P4.3 billion registered significant growth of 39.5% in Pula terms and 22% in US Dollar terms. This was driven by the strong performance of African markets, which was mirrored in the offshore funds triggering unbudgeted but significant performance fees. In South Africa, continued excellent performance for client portfolios best illustrated by the

Imara Equity Fund, attracted new clients both private but importantly institutional. Foreign flows into the Zimbabwe stock market enabled funds under management there to rise by 49% in US dollar terms. The strong performance of the Funds resulted in performance fees being earned on the Africa Fund, the Nigeria, Zimbabwe and East Africa Funds as well as the Russell Fund.

Following on from the Russell mandate to manage the African portion of their Global Emerging and Frontier Market Fund, Imara was appointed in January 2013 to manage a similar product for Danske Capital, a Scandanavian asset manager. This went some way to offsetting the loss of funds due to redemptions and the closing of the Imara Flame Lily Fund.

The Mauritian joint venture, Imara Asset Management (Mauritius) Limited, although loss making, performed above expectation and it is hoped this positive trend will continue. Efforts are underway to shortly open a similar joint venture in another African country where strong upside is anticipated.

Corporate Finance had a difficult year returning to a loss making position. Although fees were earned on transactions worked on in Angola, Botswana, Mozambique, Zambia, Zimbabwe and South Africa, performance was negatively impacted by impairment charges against receivables and legal costs relating to the on-going NBS Arbitration process. Zimbabwe registered a loss in an illiquid market despite successfully completing two mandates. Of the current mandates two would have successfully closed but for (differing) regulatory impediments. Successful completion of these mandates would have resulted in a profit for the year. Work continues on a significant mandate in Angola, which is now anticipated to be completed in the 2013/2014 financial year. During the year an empowerment joint venture, Imara Mondise, was set up in South Africa and it is anticipated that this should be well placed to attract work in not only South Africa but also Lesotho, Namibia and Swaziland. The division has a strong pipeline including privatizations, M & A,

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capital raisings and capital markets work in a number of countries. Work continues on a number of transactions, which if successful will provide long term secure annuity income, which will help to smooth earnings going forward. In Zimbabwe the micro finance business, ZIADA, continues to produce encouraging results.

Stockbroking had a mixed year returning profits of P2.1 million against P4.7 million last year. Margins continue to come under pressure in most of the markets we operate in and in particular Botswana, South Africa and Zambia. Imara SP Reid returned profits of P3.2 million, which was down on the previous year. Average monthly brokerage was 14% lower in addition to a marginal decline in the average number of trades per month. The number of active clients grew strongly to in excess of 13,000. The derivatives desk also experienced a difficult year delivering a lower contribution to revenue, while proprietary trading was also down. On the positive side Imara Africa Securities registered its first profit well ahead of expectations. Although some of this improved performance can be attributed to markets it was also due to a greater number of clients being serviced in a more coherent structured manner. With all systems in place and tried and tested, the service was launched to the retail market in South Africa post year end and it is expected that this will also yield positive returns. A further benefit is that the service has begun to open up the domestic SA institutional market for Imara SP Reid. It is important that this momentum is maintained and as such it is anticipated that further investment will be made into the sales and research team.

Turning to our associates, Stockbrokers Malawi had much improved trading results for their year ended 31 December 2012 and this trend has continued in the first half of 2013. The impact of these improved results was however negated to some extent by a significant devaluation of the Malawi Kwacha with fell in value against the Botswana Pula from 22:1 at 30 April 2012 to 52:1 at 30 April 2013.

Stockbrokers Zambia recorded a loss for the year.

This, together with a rebasing of the Zambian Kwacha, by a factor of 1 000, which took place on 1 January 2013 lead to a decision to impair the carrying cost of this investment by P904 000.

Imara Edwards Securities in Zimbabwe had a mixed year with a weak first half followed by a very strong second half. This was largely due to the re-ignition of the Zimbabwe Stock Exchange in October 2012 resulting in a strong finish to the year with total commissions earned of $1.9 m, which was 14% ahead of the prior year. Most encouraging was the performance relative to the rest of the market, with a trade weighted market share over the 12 months of 41%.

In Angola, progress towards the establishment of the stock market remained slow. The process to complete the licensing of Imara Securities Angola is underway and it is anticipated this will be completed this year. Despite mixed signals from the authorities it is still expected that the launch of the Bolsa de Valores e Mobiliarios de Angola (BVDA), (Angola Stock Exchange), will take place initially to trade fixed income instruments followed by equities in due course. In the meantime the concentration on Corporate Finance work has shown positive results.

The performance of Imara Capital Zimbabwe was largely a reflection of the Zimbabwe Stock Exchange which was a tale of two halves. The market was subdued and flat lining for the first half from April to September 2012 while renewed foreign interest saw a complete turnaround in the second half. The market rose 26% over the six months from September 2012 to March 2013, representing a gain of 34% over the financial year. This pushed broking into a strong bottom line performance and asset management into record Funds under Management. Corporate Advisory had a difficult year driven primarily by a lack of liquidity and difficult regulatory approval processes. Against this background profits were well ahead of the previous year.

The outlook in Zimbabwe continues to be dominated by

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CHIEF EXECUTIVE OFFICER’S REVIEW OF OPERATIONS

the political process and economic performance. While in the short term the politics will remain noisy, it is pleasing that a peaceful election has taken place. Although at present things appear uncertain business looks forward to the reintegration of the country with the international community. This should improve confidence leading to better liquidity in the local markets. Substantial FDI will hopefully follow.

Imara Beresford International Limited (IBI) in Mauritius, was consolidated for the first time effective 31 October 2012, following the increase in Imara`s shareholding to 51%. The Company had a strong year with profits well ahead of the previous year. This was largely due to better than expected revenues from establishment, management and secretarial fees. Going forward significant effort is being made in marketing the Company’s services. In this respect two African based senior marketing executives have joined the Company and it is expected that their efforts will soon yield positive results.

We continue to explore opportunities to increase our coverage in East and West Africa. The relationship with Chapel Hill Denham in Nigeria and Sterling Capital in Kenya continues to produce positive results. The Asset Management relationship with ICEA Asset Management, who is the co-manager of the Imara East Africa Fund, is still working positively.

A decision was taken by your Board to not implement the South African empowerment transaction with Vuvuzela Investments 1 (Pty) Limited, which was approved by shareholders last year. This was deemed prudent due to changes in the Empowerment Codes as well as the tax efficiency of the proposed structure. In this light efforts continue to achieve a satisfactory solution. The Imara South Africa Trust, which owns 6.25% of Imara Capital South Africa (Pty) Limited, continues to support the Imara Lightwarriors project, which will terminate at the end of this calendar year. A new initiative targeted at assisting specific education in South Africa as well as the region is under review. It is expected that this will be launched in 2014. The Trustees continue to work alongside the Social and Ethics Committee to evaluate options to ensure that

the Trust`s resources are deployed appropriately as part of the Group`s corporate social responsibility.

The appointment of a Group Marketing Executive has yielded positive results. This has resulted in an improved awareness of the Brand generally through a structured advertising/marketing campaign using both the print and the electronic media. Social media inclusive of Facebook, LinkedIn and Twitter all now form part of the Group`s interface with the market. A complete revamp of the Group`s website is also nearing completion.

Imara Holdings remains listed on the Venture Capital Market of the Botswana Stock Exchange and it is still intended to apply to move to the Main Board once the minimum requirement of 300 “Public” shareholders is achieved.

Outlook

In the current year to date your Group is trading at a breakeven position, despite a difficult operating environment. Once again it is anticipated that the continued growth in interest in Africa will contribute to greater inflows, which should in turn return your Group to profit in the year ahead.

I would like to thank my Chairman, Mike Ndoro, and the Board for their continued support and guidance. I must also recognise the contribution made by the entire Imara team. Their dedication and hard work continues to position Imara for growth in the future.

MJS TUNMER

CHIEF EXECUTIVE OFFICER

3 September 2013

Target rhino

Near the top of the illegal wildlife shopping list is rhino (or more specifically, rhino horn) the brutal demand for which is driven by the market in South East Asia and enabled by local poaching networks. Merely providing the co-ordinates of a rhino to poachers is an extremely lucrative inducement for the greedy, or cash-strapped hunter. The population of the Black Rhino hit an all time low of 2,140 in 1995, and it is estimated that its numbers have declined by 97.7% since 1960. Although one can take heart in the knowledge that their numbers have roughly doubled over the last 18 years, (thanks to strategic capture; transportation; re-introduction; tracking and monitoring) these pre-historic beauties are still considered to be critically endangered. The Wildlife ACT Fund alone has been involved in the reintroduction of 60 Black Rhino in the past 2 years. Part of their armoury is cutting edge transmitter technology, the movement sensors of which, when fitted to a rhino’s horn, relay instant information about the distressed animal’s whereabouts. This can enable the perpetrator to be caught red-handed.

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CORPORATE GOVERNANCE REPORT

Nature of business

Imara Holdings Limited is a Botswana registered Company, licenced by the International Financial Services Centre (IFSC), under Tax Certificate Number 22, and is the holding Company for a Group of companies conducting the following types of business, primarily for institutional and private clients:- Asset management;- Corporate finance;- Stockbroking;- Trust administration and custodial services.

There has been no significant change to the nature of business from previous years.

Corporate governance principles

The Group is committed to the principles set out in the King Report on Governance 2009 (King III). The Board is satisfied that the Group is working towards full compliance with the principles set out in King III and with progress in this regard. Explanations have been provided where the Group is yet to comply with certain key principles.

The Imara Holdings Limited Board (the Board) is the highest decision making body in the Group and is ultimately responsible for corporate governance. The Board acknowledges the relationship between strategy, risk, performance and sustainability. The Board of Imara Holdings Limited remains committed in its stewardship of the Group’s affairs, to applying the highest standards of corporate governance and international best practice.

Ethics and organisational integrity

The Board provides effective leadership based on an ethical foundation and directs the strategy and operations to build sustainable businesses. Professional and ethical conduct and the highest standards of integrity are an integral part of how the Group conducts its business affairs. The Group recognises that investor and stakeholder perceptions are based on the manner in which the Group, its directors, management

and employees conduct business. The Group, therefore, strives to achieve the highest standards of integrity, transparency and business ethics at all times. The Board’s deliberations take into account the values underpinning good corporate governance, namely:- responsibility;- accountability;- fairness; and - transparency

and also the Group’s core values namely:- integrity;- knowledge;- discipline; - enterprise; and- resoluteness;

The Group formulated and implemented a Code of Ethics during the year. This document codifies the ethical principles which the Group subscribes to and applies. The Code of Ethics assists the Board in ensuring that business ethics across the entire Group are managed effectively and consistently.

The Social and Ethics Committee, established in 2012 to comply with South Africa statute, continues to meet on a regular basis and reports to the Imara Capital South Africa and Imara Holdings Limited Boards. Its terms of reference are reviewed annually and are approved by these Boards.

Board Charter

The Board Charter outlines the role of the Board and its responsibilities.

Key responsibilities of the Board include:i. the setting of the strategic direction of the Group

and monitoring management’s implementation of that strategy;

ii. ensuring an effective corporate governance structure;

iii. ensuring that effective audit, risk management,

20PAGE |

information technology, internal control and compliance systems are in place to protect the Group’s assets, so as to minimize the possibility of operating beyond legal requirements or acceptable risk parameters;

iv. monitoring of operational performance;v. ensuring that succession planning is in place; andvi. the integrity and quality of communications with

stakeholders, regulators, shareholders and employees.

Composition and functions of the Board

The Group is governed by a unitary Board of directors. In terms of the Company’s Constitution, the Board may not comprise fewer than four or more than twenty directors, at least one of whom shall be ordinarily resident in Botswana. The Board of directors is chaired by Michael Ndoro a non-executive director and comprises ten directors, five of whom are non-executive. Gunter Steffens is the lead independent director. The majority of non-executive directors are independent. Details of the composition of the Board are detailed on page 10 of this Annual Report.

In terms of the Company’s Constitution, directors are appointed for three years. At least one third of the directors, (rounded down), retire by rotation annually and if available, can offer themselves for re-election at the Company’s Annual General Meeting. Non-executive directors are not required to hold shares in the Company but certain directors have independently elected to do so. Remuneration levels of non-executive directors are reviewed annually and benchmarked against the Botswana financial services sector companies and proxy financial services Groups with a regional presence.

The roles of the Chairman and the Group Chief Executive Officer are separate with clear divisions of their responsibilities to ensure a balance of power and authority between them.

The Board delegates responsibility for implementing

the strategic direction and managing the day-to-day operations of the Group to the Group Chief Executive Officer. The Chief Executive Officer consults with the Chairman, in the first place, on matters which are sensitive, extraordinary or of a strategic nature.

The Board composition is balanced so that no individual Board member or small Group of members has unfettered control over decision making.

Independent non-executive directors

The Board evaluates the independence of non-executive directors annually. Independence is determined according to the King Code of Governance recommended practice, which requires rigorous reviews of directors’ independence and performance annually and particularly so after they have served on the Board for over nine years. The Board, following its evaluations, is of the view that all independent non-executive directors are indeed independent.

Declaration of directors’ interests

Directors of the Board and subsidiary Boards are required to make annual declarations of their interests and a register of directors’ interests is maintained by the Company Secretary. Directors and management are also required to disclose any material interests in contracts and business transactions relating to the Group and to recuse themselves from any discussions relating thereto. The Board manages all conflicts of interest when they arise. The management of conflicts of interest at subsidiary Company level is delegated to the respective Boards within set parameters.

Board appointments

The selection and appointment of directors is a formal and transparent process, involving the Board as a whole and assisted by the Nominations Committee. In appointing directors, emphasis is placed on achieving a balance of skills, experience, professionalism and industry

21PAGE |


knowledge necessary to conduct the business of the Board.

There have been no new appointments to or resignations from the Board of Directors during the past year, except for those directors who retired by rotation, as required by the Company’s Constitution, and who were re-elected at the Annual General Meeting.

Company Secretary

The Company Secretary is appointed by the Board of Directors. All directors have direct access to the Company Secretary and to information regarding the Group’s affairs. David Stone serves on the Board as an executive director and is also the Company Secretary. Consequently, the Company has not complied with the King III Code recommendation that the Company Secretary should not be a director of the Company. The Board is, however, of the view that the incumbent is able to execute both roles effectively and independently and the status quo will be reviewed and re-assessed from time to time.

Board meetings

The Board meets at least four times a year to review the Group’s financial performance, strategic direction and key policies. It approves budgets and reviews the overall effectiveness of the internal control, risk management and statutory and regulatory compliance systems. It also monitors the implementation of strategy and policy through structured reporting mechanisms and consequent accountability by executive management.

Access to information and resources Directors have unrestricted access to executive management, the Company Secretary and Group information. They are also entitled to make use of independent professional advisors, at the Group’s expense, when necessary to discharge specific responsibilities. External auditors attend the Group and subsidiary audit committees by invitation. Non-

executive members of the Audit and Risk Committee meet with the external auditors at least once a year without executive management present.

Board effectiveness and evaluation

The Chairman of the Board requires all directors to complete annual questionnaires to evaluate the effectiveness of the Board as a whole and also of its members. This process is used to ensure that the responsibilities detailed in the Board Charter are discharged effectively in accordance with best practice. The results of the evaluation are collated by the Chairman and discussed with the Board with the purpose of identifying training needs for directors. The evaluation process includes a review of the performance of individual directors, including the Chairman. The most recent evaluation exercise indicated that the directors’ were satisfied with the overall effectiveness of the Board and that of its members.

The Chairman has also instituted a training program for all main Board directors, whereby directors are required to attend specific training course, through the South African Institute of Directors annually.

Board Committees

The Board is assisted in the discharge of its duties and responsibilities by a number of Board committees, which comprise the:- Audit and Risk Committee, - Executive Committee; - Nominations Committee; and- Remuneration Committee; These Committees are accountable to the Board. All of the Committees are chaired by non-executive directors, with the exception of the Executive Committee which is chaired by the Group Chief Executive Officer. Board Committees, in the main, make recommendations to the main Board for its approval or final decision. Terms of reference of the Committees have been approved by the main Board and are reviewed annually. Minutes of Committee meetings are circulated and reported on at

Mkuze Zulu girl and Giraffe

“We must begin thinking like a river if we are to leave a legacy of beauty and life for future generations”, advised the prominent conservationist David Brower. What was meant by this injunction? Consider the impact of a river on the habitat through which it meanders, and it becomes clear that the Mkuze River is not merely a curving trajectory of water. It is a riparian organism, whose dissipating energy animates the terrestrial body around its banks. A river gives birth to an entire habitat-complex of vegetation, root systems, and wildlife. The great biodiversity that typifies riparian zones like the Somkhanda naturally engenders a linkage of diverse animal communities across long stretches of the adjoining land. In other words, a river facilitates the conditions for its own wildlife corridor. Similarly, when humans work in concert with the environment using the best conservational knowledge at their disposal, the effect on the land is vitally generative. This knowledge must be available, for example, to optimally manage giraffes within the confined spaces of Nature Reserves, otherwise the browsing habits of these ungulates has a thinning effect on acacia tree density.

23PAGE |


ensuing Board meetings. Senior executives are invited to attend meetings of the committees by invitation, where considered appropriate.

Audit and Risk Committee

The Audit and Risk Committee is chaired by Gunter Steffens, the lead independent non-executive director and comprises three members, all of whom are non-executive directors. Details of the composition of the Committee is detailed on page 10 of this Annual Report. The Group Chief Financial Officer and the Chairman of the Board attend meetings of the Committee by invitation.

The main responsibility of the Committee is to assist the Board in discharging its responsibilities under the Companies Act for ensuring compliance with regulations imposed by regulators and supervisory authorities and for assessing, managing and monitoring risk.

The Committee has formal terms of reference which have been approved by the Board and set out its responsibilities.

The Audit and Risk Committee is responsible for recommending the appointment of the external auditors and overseeing the external audit process. It also monitors the effectiveness of:- financial controls;- reporting;- compliance with International Financial Reporting Standards (IFRS);- the system of internal control; and- statutory and regulatory compliance at both Group and subsidiary Company level.- Risk Management

The Committee also assesses the independence of the external auditors.

Audit and Risk Committee meetings are held at least three times a year and are attended by the independent external auditors, who have unrestricted access to the Chairman of the Committee. Meetings are also attended by internal auditors, compliance officers and senior management,

on an as required basis. The Committee meets with the external auditors at least once a year, without executive management present.

The Audit and Risk Committee has: - satisfied its responsibilities for the year, in compliance

with its terms of reference;- satisfied itself regarding the effectiveness of internal

financial controls;- satisfied itself regarding the independence of the

external auditors; and- has recommended the approval of the consolidated

and Company annual financial statements, incorporating accounting policies, to the Board.

Executive Committee

The Executive Committee is chaired by the Group Chief Executive Officer and comprises the senior executives of the Group. The Committee meets monthly and is responsible for managing the business of the Group when the Board is not in session, subject to statutory and any other limitations on the delegation of authority determined by the Board from time to time. It also acts as a medium of communication and co-ordination between business units, Group companies, and the Board.

- The Executive Committee is also responsible for the implementation of structures, processes and mechanisms relating to information technology governance. The Committee monitors information technology governance practices and ensures that they are aligned with the Group’s performance and sustainability objectives

- The Committee has formal terms of reference, which set out its responsibilities.

Remuneration Committee

The Remuneration Committee is chaired by Gary Johns, a non-executive director and comprises three members all of whom are non-executive directors. Details of the composition of the Committee are detailed on page 10 The Chief Executive Officer and one other executive director attend meetings of the Committee by invitation.

24PAGE |

The Remuneration Committee is responsible for setting remuneration policies for the Group. It aims to ensure that the financial rewards offered to employees are sufficient to attract people of the calibre required to effectively implement strategy, and manage the Group’s affairs in order to produce the required returns for shareholders. It also seeks to ensure that directors and executives are fairly rewarded for their respective contributions to the Group. The Committee performs annual reviews of the Employee Share Option Scheme, the allocation of share options, the profit sharing scheme and the apportionment of profit share to executives and employees.

The Committee has formal terms of reference which set out its responsibilities. The Committee has satisfied its responsibilities for the year, in compliance with its terms of reference.

Nominations Committee

The Nominations Committee is chaired by Michael Ndoro and comprises four members, two of whom are non-executive directors. The Committee includes the Chief Executive Officer and is responsible for making recommendations to the Board on all new appointments to the Board and reviews the appointment of directors to subsidiary Company Boards. A formal and transparent process is in place in terms of which the requisite skills needed on the Board are identified and those individuals who are best suited for the position and who are able to assist the Board in their endeavours, are recruited. The Committee meets on an as required basis.

The Committee has formal terms of reference, which set out its responsibilities. The Committee has satisfied its responsibilities for the year, in compliance with its terms of reference.

Risk Management

The Board is responsible for determining the risk appetite of the Group, for setting risk parameters and for the overall governance of risk. The Audit and Risk Committee currently assists the Board in discharging

its risk responsibilities by monitoring the effectiveness of risk management procedures at both Group and subsidiary Company level. The Board currently holds the view that the risk and audit function can be combined under a single Committee and as a consequence, there is no separate Risk Committee. This position is however likely to change once implementation of Enterprise Risk Management System is complete.

In 2012, the Audit and Risk Committee recommended the implementation of an ISO 31 000 compliant Enterprise Risk Management System (“ERMS”), to assist in the enhancement and standardisation of the Group’s risk management processes. Implementation of the ERMS is in progress but not yet complete. Completion is targeted before December 2013. The Board is however satisfied that existing risk management practises are adequate during this transitional phase.

Internal Audit

There is currently no centralised internal audit function at a Group level. Certain subsidiary companies have their own internal audit departments but in the main the internal audit function is outsourced. Internal audit reports directly to the Board of directors of their respective companies. The Audit and Risk Committee is looking to expand the internal audit function in order to attain effective combined assurance.

Supervisory and Regulatory Compliance

The Group and certain of its subsidiary companies are subject to supervisory and regulatory controls in the geographic or country jurisdictions where they operate.In the case of Imara Holdings Limited, the regulators and supervisory authorities are:

- Non-Bank Financial Institutions Regulatory Authority (NBFIRA)

- International Financial Service Centre (IFSC)- Botswana Stock Exchange (BSE)

The Group’s primary regulator is NBFIRA.

25PAGE |


The regulators and supervisory authorities at subsidiary Company and fund level are as follows:

- Imara Asset Management (UK) Limited – Financial Conduct Authority– United Kingdom;

- Imara Africa Opportunities Fund - Dublin Stock Exchange - Ireland;

- Imara Asset Management South Africa (Proprietary) Limited - Financial Services Board – South Africa;

- Imara Asset Management Zimbabwe (Private) Limited – Reserve Bank of Zimbabwe;

- Imara Beresford International Limited – Mauritius Financial Services Board;- Imara Capital Securities (Pty) Limited – NBFIRA and

Botswana Stock Exchange- Imara Corporate Finance (Private) Limited-Zimbabwe -

Securities Exchange Commission of Zimbabwe;- Imara Edwards Securities – Zimbabwe Stock Exchange- Imara SP Reid (Proprietary) Limited - Johannesburg Stock Exchange and Financial Services

Board – South Africa

Supervisory and regulatory controls are generally based on the submission of prescribed returns and annual compliance certificates and in all instances there is an exception reporting requirement.

There have been no breaches of supervisory and regulatory controls within the Group and its subsidiaries during the past year.

The past year has been characterised by an increase in both the complexity and frequency of regulatory compliance reporting. To address these developments, a Group compliance unit has been established and a Group Compliance Officer appointed. Compliance Officers at subsidiary Company level report to their respective companies and also to the Group Compliance Officer.

Board meeting attendance

SM NdoroMJS TunmerAR FlemingG E JohnsJR LegatACH MackeurtanRH MacleodTJ Matsau GZ SteffensDE Stone

* By invitation.

3/3*--

3/3---

3/33/3

3/3*

4/44/4*

-3/4

-3/4*

-4/4

--

3/33/3*

-3/3

-3/3*

-

--

4/44/40/44/44/44/42/44/44/44/4

1/10/10/11/1

0/10/10/10/10/11/1

Director Audit & Risk Committee

Remuneration Committee

Nominations Committee

Main AGM

2012/2013 Board Attendance Register

26PAGE |

AR FlemingGE JohnsJR LegatACH MackeurtanRH MacleodSM NdoroDE StoneMJS Tunmer

Total

5 652 10363 122

2 841 2632 573 124

1 399 826-

110 8505 913 859

18 554 147

--------

-

5 652 10363 122

2 841 2632 573 124

1 399 826-

110 8505 913 859

18 554 147

--

175 000100 000

158 333-

176 000163 000

772 333

--

235 000150 000223 333

-221 000213 000

1 042 333

Director

Number of shares held directly and indirectly at

30 April 2013

Movement in directors

shareholding post year end


31 July 2013

Share options held under the

Imara Share Option Scheme

30 April 2013



31 July 2013

Directors’ shareholding

As at 30 April 2013 and 31 July 2013 (the last practicable date prior to the publication of this Annual Report), the directors, directly and indirectly, held the following shares in the Company:

AR FlemingGE JohnsJR LegatACH MackeurtanRH MacleodSM NdoroDE StoneMJS Tunmer

Total

5 652 10363 122

2 841 2632 549 119

1 399 826-

110 8505 913 859

18 530 142

--------

-

5 652 10363 122

2 841 2632 549 119

1 399 826-

110 8505 913 859

18 530 142

--

125 00050 000108 33350 000

196 000113 000

642 333

--

175 000100 000

158 33350 000

246 000163 000

892 333

Director


30 April 2012

Movement in directors

shareholding post year end


31 July 2012



30 April 2012



31 July 2012

Comparative information relating to directors’ shareholding as at 30 April 2012 and 31 July 2012 are as follows:

Directors’ remuneration

At the Annual General Meeting of the Company on 22 October 2013, shareholders will be asked to approve the remuneration paid to the directors for the year amounting to P13 232 107 (2012: P12 318 065). Remuneration paid to directors of the Company is disclosed in Note 4 on page 66 and note 15 on page 91

27PAGE |


Botswana Stock Exchange

The Imara share was listed on the Venture Capital Market of the Botswana Stock Exchange on 4 October 2006. A minimum of 300 public shareholders is required for a Company to be listed on the main Board of the Botswana Stock Exchange. It remains the Company’s intention to seek a listing on the main Board once the minimum number of shareholders has been achieved. As at 30 April 2013, Imara had a total of 260 shareholders of which 220 were public shareholders. (2012: Total of 273 shareholders of which 226 were public shareholders).The Company has during the year, complied with all of the BSE requirements for a listed entity.

Dealing in securities

The Group has a policy prohibiting dealings in its shares by its directors, officers, executive management and employees during closed periods, which are in effect:- from 1 November until the publication of interim

financial statements; and- from 1 May until the publication of annual financial

statements; and - when any directors, officers, executive

management and/or employees are in possession of price sensitive information, not readily available to the public.

The Group’s policy is fully compliant with the Botswana Stock Exchange’s requirements for listed companies.

Communication with stakeholders

The Group is committed to a policy of effective communication with stakeholders on matters of mutual interest. The Group has adopted the Botswana Stock Exchange’s guidelines pertaining to the dissemination of financial information to stakeholders. Liaison meetings are also held with NBFIRA, the International Financial Services Centre, regulators and supervisory authorities to brief them on the Group’s performance and key strategic initiatives.In keeping with the Group’s commitment to continually improve communications with stakeholders, the Group has an Investor Relations section within the Imara Holdings website, www.imara.com, which allows stakeholders to access salient information pertaining to the Group.

Social corporate responsibility

The Board considers the legitimate interests and expectations of stakeholders when deciding in the best interests of the Group. In determining the best interests of the Group, the Board views the Group as a sustainable enterprise and responsible corporate citizen.

Remuneration paid to non-executive directors of the Company for the year under review is tabulated below:

SM NdoroAR FlemingGE JohnsTJ MatsauGZ Steffens

Total

307 345171 179

300 329249 360272 593

1 300 806

72 137-

52 5289 65211 857

146 174

13 143----

13 143

392 625171 179

352 857259 012

284 450

1 460 123

Director Directors fees ExpensesShare based

payment expenseTotal

Remuneration

28PAGE |

Imara is a Group with an authentic African heritage which owes its success, in part, to the support of the communities in which it operates. The Group recognises its role and responsibility as a corporate citizen and is committed to providing support to those communities through broad based programmes, sponsorship and other initiatives. The Imara South Africa Trust was established in May 2011 and has as its main objective the provision of educational assistance to people from previously disadvantaged Groups in South Africa. A portion of the annual dividends declared by Imara Capital South Africa (Proprietary) Limited will accrue to the Trust. As part of its Social Corporate Responsibility, and under the auspices of the Imara Trust, the Group is pleased with on-going developments under the Imara Lightwarriors Project. The aim of this project is narrated in more detail elsewhere in this Annual Report and illustrates the Group’s commitment to offer educational support to the communities in which it operates.

The Group launched an art collection in 2010, styled “The Imara Collection”. This body of photographic work broadly illustrates the theme “Investing in Africa”, through a variety of different lenses and will continue to be published exclusively in our Annual Reports. Additions to the collection during the 2013 year came from the Imara Lightwarriors Project and a field trip undertaken to the Kwa Zulu Natal in South Africa.

Post balance sheet events

No events or transactions have occurred since 30 April 2013 or are pending, that would have a material effect on the financial statements at that date or for the year then ended, or that are of such significance in relation to the Company’s or Group’s affairs as to require mention in a note to the financial statements in order to not make them misleading regarding the financial position, results of operations, or statement of cash flows of the Group or Company.

Directors’ responsibility for the financial statements

The directors are responsible for the preparation and fair presentation of the financial statements of the Group and Company in accordance with International Financial Reporting Standards and in a manner required by the Companies Act of Botswana (Companies Act, 2003).This responsibility includes, designing, implementing and maintaining internal controls relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error; selecting and consistently applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

The directors have satisfactorily discharged their responsibility in respect of the financial statements of the Group and Company for the year ended 30 April 2013.

The audited financial statements of the Group and Company were approved and adopted by the Board on 26 July 2013 and Messrs MJS Tunmer and DE Stone were authorised to sign these financial statements.

The un-audited financial statements for the Group for the six months ended 31 October 2012 were announced on 14 December 2012 and reflected a loss after tax of P5 120 505.

The audited results of the Group for the year ended 30 April 2013, were announced on 26 July 2013, and reflected a loss after tax of P1 500 141. The profit after tax for the second half of the year, therefore amounted of P3 620 364.

School children from the Gumbi tribe, future custodians of the environment

Part of the fresh educational vision of the Wildlife Act Fund’s programmes is to transform the mindset of the children. It wants the young community members to envisage their peers in the role of conservationists. Through the Wildlife Active Kids Project, environmentally focused education reaches children in communities that live close to game reserves. Through the bush camp program in Somkhanda Game Reserve, local children benefit from the expert conservation education of professionals from Tembe Elephant Park and Mkhuze Game Reserve. The Community Conservation Liaisons, who have been trained as camp guides themselves, can empower the Gumbi Community with the same opportunity. There are also seminars that draw from the perspectives of community members, so that relevant strategies for economic development can be devised in conjunction with the communities at large. It is only when the feasibility of different community development options is ascertained, that alleviating issues such as food security (which drives the bush meat trade) becomes an option. Provided the intricacies of conservation as a concept are understood, the next generation of Africans can develop the capacity to project and implement its own unique vision – towards the long-term future of the environment that sustains them.

31PAGE |

IMARA’S CORPORATE SOCIAL INVESTMENT INITIATIVE UPDATE

The Imara Trust; converting complexity into African strength

The Imara Trust was launched on the 1st of May 2011 with the resolute intention of long-term contribution to Black Economic Empowerment with a broad range of beneficiation. Over the last three years, the African investment journey with respect to the Imara Trust has led Imara towards an empirically derived, more nuanced understanding of Corporate Social Responsibility. Imara has accepted that a strategic, adaptable approach to a Corporate Social Investment (CSI) is crucial for Imara to continue realising its aims of good corporate citizenship in accordance with 21st century sustainability measures.

Accordingly, dividend flows from Imara’s South African businesses (along with donations from The Imara Group) will continue to be channelled into Imara’s ongoing CSI with a strategic mindset that adapts holistically to evidence of need, in areas where Imara has presence. Imara appreciates that corporate social responsibility embraces the complex interdependence of social, economic, and environmental factors. Furthermore, Imara realises that empowerment for developing communities in Africa depends on a synthesis whereby all three factors mutually re-enforce one another in dynamic equilibrium. It is also important to Imara that the right balance of investment is struck between quality (depth) and quantity (breadth). This balance is illustrated by considering the exciting professional and academic developments afforded by Imara’s long-standing commitment to Teddy Sambu, our photographic Bursar and first Imara Lightwarrior.

This year’s Imara Lightwarrior expedition to the Mkuze River drew Teddy, camera in hand, along with mentor and artist, Athol Moult, deep into the reality of tribal life around the Somkhanda Game Reserve and environs. Here, they captured the authentic

imagery that comprises the six artworks in these pages. This fourth instalment of the Imara Collection tells a story of a region in rural Africa. It is an artistic expression of a complex eco system surrounding the Mkuze River, which winds its way through world famous nature reserves and tribal community land, supporting a diverse array of people and wildlife. In this region of KwaZulu Natal, a critical mass has been brought about by the friction of increased population, and unsustainable subsistence practices. This in turn has created an urgent need for broad-ranging education.

The modern challenges of tribal life in Zululand

Historically, the sustainability of river communities around Africa has depended on resources being abundantly accessible within the natural environment. However, the traditional, more itinerant approach to survival for such communities has become unviable in the 21st century, as the number of people pushing into and living within these regions continues to swell.

The Gumbi community, who were visited on the expedition to the Mkuze River, serve as an instructive example of the dynamics of the region’s current challenges. Here is a tribe who were, on the face of it, in a comparatively ‘privileged’ position. In an historic decision, they had been able to rightfully reclaim their community land. Following this, the Gumbi community decided to allocate a portion of their land for grazing and homesteads, while the rest was declared a game reserve – so far so good. The fact that this community is now enduring systemic problems stemming from unsustainable use of the land and its wildlife, is somewhat ironic. Currently, burgeoning communities like the Gumbi are unable to support themselves using the available resources (e.g. cattle, fish, crops) within their natural environment in perpetuity (i.e. sustainably),

32PAGE |

and the level of destitution makes them susceptible. When one accepts that the natural environment is an integral part of the Somkhanda region’s economic lifeblood, it makes sense to investigate how the environmental and social ills of the region around the Mkuze River manifest.

As it happens, there are a variety of practices straining the land of the Somkhanda region and endangering its wildlife. As the population, in the Gumbi and other communities in the tribal region, continues to expand, the communities are pushed closer to the boundary lines of the Game Reserves. Because of an unwieldy increase in cattle and the over-grazing that ensues, there follows a huge temptation to exploit the reserves. In the reserves, the land is lush because the rolling savannah has been protected by techniques that ensure against over-grazing. Understandably, community members have resorted to removing fences and letting their cattle in to graze. Also, limited job opportunities within the community and low employment render conventionally sourced meat prohibitively expensive. Hence, a whole trade has grown up around ‘bush-meat’. Community members ensnare supposedly protected game within the reserves to sell for bush meat, a far cheaper alternative than conventionally sourced produce. Although it is less prevalent, tribal community members in the region have also been known to succumb to unsavoury financial inducements, such as poaching for the wildlife trade.

The expert revolution in education – community centred, environmentally specific

Given that the Somkhanda Game Reserve is owned by its surrounding community members, it is sad that this has been the response to the land useage. However, the knowledge that the problem is perpetuated by too many inhabitants being unaware of the reserve’s

potential (surprisingly, some community members are not even privy to the essential fact that they are the owners of the land and the animals within it), has provided a specific opportunity for social and environmental renewal.

While the municipality has provided basic infrastructure, the quality and context-specific nature of education in the region will play a key role in the future success of these communities. On the Imara Lightwarrior expedition to the Mkuze River region, Dr Simon Morgan of The Wildlife ACT Fund hosted Teddy and Athol through Somkhanda. Dr Morgan explained that the Fund’s Trustees, while overseeing the wildlife monitoring and conservation work on Somkhanda Game Reserve on behalf of the community, noted a need for an intensive and extensive community conservation education programme. Discourse with children in the region had revealed a limited conception of the career options available to them as adults. Invariably, community children were only able to identify with the possibility of entering three professions – teacher, policeman, or nurse – because these were the only professions, beyond hunting, that they encountered in the region. The Fund, of course, could immediately see the potential for a range of career paths relevant to the local children in the realm of conservation and eco-tourism. However, for the children to understand and ultimately gravitate towards these options they needed to become attainable. Something new would need to be offered with respect to education and training.

As a response, the Wildlife ACTive Kids Project was formed as part of the Fund’s overall community conservation education effort. The Wildlife ACT Fund’s community conservation project includes intervention with compromised individuals, education of adjacent communities about the unsustainability of poaching practices, and education

33PAGE |

IMARA’S CORPORATE SOCIAL INVESTMENT INITIATIVE UPDATE

of local communities about the importance of wildlife conservation and biodiversity conservation in general. Adult conservation awareness seminars are given at community meetings in all the tribal communities surrounding Somkhanda Game Reserve. Training and employment of local community members, for wildlife monitoring and conservation education jobs in the game reserve, are also provided. The surveys conducted at community meetings help to ascertain the community development needs of villages adjacent to the game reserve.

At a grassroots level, monthly in-school conservation lessons are conducted in all 10 primary schools in the tribal communities surrounding Somkhanda Game Reserve. Four-day free-of-charge Wildlife ACTive Kids conservation bush camps (with all grade six students and teachers from all 10 primary schools) are held at the community owned Ubhejane Bush Camp. Is the education effective? Before educational initiatives, many community members, including children, felt that there was nothing wrong with, poaching with snares.

However, ongoing evaluation procedures with children show that attitudes about poaching change dramatically in a positive direction after students go through the Wildlife ACTive Kids conservation education program. Identical questionnaires (regarding environmental science understanding, and conservation attitudes) are administered once before in-school conservation lessons begin, and again after the Children’s Bush Camp Program experience.

On exit, and without revision, the students are exhibiting, on average, a 108% increase in correct or preferable answers. Broadly speaking, the initiative consults community leaders to ascertain community needs, injects the local school curriculum with highly

effective environment-specific, career-oriented education, and links the communities with relevant donor organizations.

Wild expansion: a sustainable blue-print for investment in human ingenuity

Imara applaud the schools conservation project in the Somkhanda region and believe that there is merit in the expansion potential of this project or the establishment of similar projects in other regions or countries, such as Botswana. What became clear during the field trip was that as a game reserve owned and created by a tribe, further success in Somkhanda could work as a blue-print for other regions.

The dynamics of a project of this nature are catalytic in the way they create a nexus of beneficial relationships. Tribal leadership melds with conservation expertise and the current needs of tribal communities adjacent to Game Reserves.

Imara lightwarrior, Teddy Sambu: an African success story

On an individual level, it is heartening to report that our photographic Bursar, Teddy Sambu, has exceeded Imara’s expectations with regards to his academic and professional achievements. At the Cape Town School of Photography he has shone with his second-year projects. His ‘Personal Project’ (entitled “The Paradox of Ritual”) contrasts Western Christian Religious rituals – specifically Zionist Christian Church & Catholic Church rituals – with the rituals of traditional, Sangoma based spirituality in Khayelitsha. According to the academic staff, the quality and evocativeness of this work served as further evidence of Teddy’s aptitude for portraiture and visual storytelling. Professionally, Teddy’s energies have found a natural home in corporate photography.

34PAGE |

Bear in mind that the services of corporate photographers are engaged to visually express the personality and philosophy of a business. Teddy’s innate people skills, underpinned by his ever-increasing technical mastery, make him a natural,and there is industry proof that this is a professional avenue worth encouraging Teddy to pursue: so pleased were they with his work, Platters Guide to South African Wine has invited Teddy back to shoot a second round of portraits for this year’s edition.

Another opportunity has arisen with a major upmarket retailer. Teddy successfully completed a week of work experience in the Woolworths in-house photography studio, and may yet be offered an internship in a Company well-established for its enterprise development among emerging South Africans. Teddy is involved in originating photography for ‘Bags for Good’, the project that produces re-usable shopping bags for Woolworths; with his pictures.

Back in his township, Teddy’s reputation as an entrepreneur and his involvement with the community remains deep and constant: he’s still the go-to person in Khayelitsha for photography services needed at funerals, weddings, graduations, and social events and continues to employ two people at Khanye Photo Productions. It may be stating the obvious to observe that Teddy has come a long way since taking photographs of children playing football on the N2 with very rudimentary equipment. However, it is well worth reflecting that with the right network of sustained support, someone with limited education but abundant talent and resilience, can progress through career stages that would otherwise have been unattainable given the limitations of an underprivileged background. Nikon and 44Black enabled Teddy to take the first step of setting up a photography and framing shop in Khayelitsha, whereupon the Imara Lightwarriors CSI

has facilitated an invaluable bridging process.

Two years on and Teddy is apt to enter the photographic industry at a level commensurate with his talent. Imara is proud to see Teddy, with the right vocational preparation, academic immersion, and mentoring, heading out beyond his course of study towards a bright future – a future with relevant professional contacts for commissions, and sought after photographic apprenticeship opportunities in the industry.

35PAGE |

GLOSSARY

Term Meaning or Definition

Attributable earnings the portion of net profit for the year, which is attributable to ordinary shareholders of the Company

Attributable losses the portion of net losses for the year, which are attributable to ordinary shareholders of the Company

Attributable earnings growth the percentage increase in attributable earnings, from one reporting year to the next

BBBEE (“BEE”) Broad Based Black Economic Empowerment

Cash flow the movement of cash in and out of the Group

Capital employed the sum of total equity plus non-current liabilities

Closed period the period from the end of a designated financial reporting period to the date of the announcement of the results for that period, during which directors, officers and employees of the Company are prohibited from dealing in the Company’s shares

Cost to income ratio cost of services sold plus operating expenses, as a percentage of total income, which comprises revenue and other income

Diluted earnings per share attributable earnings divided by the diluted weighted average number of shares.

Diluted weighted average number of shares the weighted average number of shares increased by the number of shares that may be issued in future, as a result of existing dilutive instruments (share options & debentures)

Dividend per share dividend declared for the year divided by the number of shares in issue at year end

Dividend cover the number of times that the Company’s dividend to ordinary shareholders’ could be paid out of its profit after tax in the same accounting period

Dividend yield dividend per share as a percentage of the closing price of the Company’s ordinary shares

Earnings per share or EPS attributable earnings divided by the weighted average number of shares

Earnings yield earnings per share as a percentage of the closing price of the Company’s ordinary share

EBITDA earnings before interest, taxation, depreciation, amortisation

Effective tax rate the tax (charge)/credit as a percentage of profit before taxation

Free cash flow per share net cash flows for the year, (inclusive of working capital changes), divided by the weighted average number of shares

The following is a glossary of terms and definitions used in this Annual Report: The glossary of terms and definitions above should be read in conjunction with the Group’s accounting policies.

36PAGE |

Term Meaning or Definition

Funds under management assets managed by the Group, which are beneficially owned by clients and as such do not form part of the consolidated Statement of Financial Position

Gearing ratio long term interest bearing loans and borrowings divided by shareholders’ equity

IFSC International Financial Services Centre, the Botswana Offshore Centre

Liquid assets assets held in cash or which can be readily turned into cash with minimal capital loss

MK Malawi Kwacha, the standard monetary unit of Malawi

Market capitalisation the value of a Company obtained by multiplying the number of ordinary shares in issue by their market value

NBFIRA Non Bank Financial Institutions Regulatory Authority

Net asset value per share shareholders’ equity divided by the number of ordinary shares in issue at year end

Operating earnings after adjusting attributable earnings less “special” items (i.e. asset managementfor “special” items performance fees and other non-recurring profit items)

Price earnings ratio the price of the Company’s ordinary shares divided by earnings per share

Pula or P Botswana Pula, the standard monetary unit of Botswana

Dividend yield dividend per share as a percentage of the closing price of the Company’s ordinary shares

Rand or ZAR South African Rand, the standard monetary unit of South Africa

Return on average assets net profit for the year as a percentage of average total assets

Return on capital employed attributable earnings as a percentage of capital employed

Return on equity attributable earnings as a percentage of shareholders’ equity at year end

Revenue growth the percentage increase in revenue, from one reporting period to the next

Shareholders’ equity stated capital plus reserves The Group Imara Holdings Limited together with its subsidiaries and associates

The Company Imara Holdings Limited, a Company registered in Botswana

thebe the smallest monetary unit of Botswana amounting to one hundredth of a Pula

USD or US$ United States Dollar, the standard monetary unit of the United States of America

Weighted average number of shares the number of ordinary shares in issue at the beginning of the year, increased by shares issued during the year, which in turn are weighted on a time basis for the period during which they participated in the income of the Group

37PAGE |

122 48310 774

98 097105 925

8 504(3 742)

4 7625 635

137 731148 976199 921

(16 253)3 054

139

4,093,782,15

0,0028,2044,0093,90

338,4027,8917,68

237,03161,90168,63

3,54(17,52)

3,222,96880

34

145 9196 015

126 431140 547

3 477(4 977)(1 500)(4 305)129 209143 474252 471

(15 875)4 260

189

(3,33)(3,00)(0,66)

0,0019,13

143,4197,91

(44,17)28,88

32,71(59,36)(131,50)

(176,39)(6,19)26,29

1,931,84772(8)

P 000’sP 000’sP 000’sP 000’sP 000’sP 000’sP 000’sP 000’sP 000’sP 000’sP 000’sP 000’s

P m’s

Number

%%%%%%%%%%%%%%%

timestimes

P 000’sP 000’s

FIVE-YEAR FINANCIAL HIGHLIGHTS AND RATIOS

101 51610 736

85 69982 464

8 6012 9275 6745 770

132 168133 536

208 46464 4611 894

90

4,374,322,44

0,69(43,31)34,0392,05

(84,01)(47,28)(16,95)

(86,82)(89,79)(89,78)

(4,98)(18,96)

2,602,521 134

63

92 8093 988

78 22082 267

2 1631 662

501247

140 817144 399

244 09925 6632 768

118

0,180,170,22

0,00(8,58)76,8697,83

(62,86)(8,73)(0,25)

(74,86)(91,17)

(95,72)6,54

17,092,161,96787

4

95 538(4 519)76 70790 010

(6 206)1 487

(7 693)(8 211)

133 021136 973242 383

(22 486)2 960

118

(6,17)(5,99)(3,16)0,002,94

23,97106,01

(213,32)(1,93)

9,41(386,86)

(1 636,27)(3 427,37)

(5,54)(0,70)

2,031,81810

(65)

Salient financial results and data:

Revenue EBITDAGross profitOperating expensesProfit / (loss) before taxationTaxationProfit /(loss) after taxationAttributable earningsShareholders’ equity Capital employedTotal assetsFree cash flows for the yearFunds under management at year endNumber of employees – average for the year

Key financial ratios:

Return on equityReturn on capital employedReturn on average assetsGearing ratioRevenue growthEffective tax rateCost to income EBITDA – year on year changeGross profit – year on year changeOperating expenses – year on year changeProfit / (loss) before tax – year on year changeProfit / (loss) after tax – year on year changeAttributable earnings growthShareholders’ equity- year on year changeTotal assets – year on year changeCurrent assets to current liabilitiesLiquid assets to current liabilitiesRevenue per employee Profit / (loss) after tax per employee

Years ended 30 April

20122013 2011 2010 2009

Reclassified

38PAGE |

59 14058 65061 220

255285210

150,81273

9,619,20

3,00Passed

3,00

1,181,18

2,6826,54

2,35(0,28)

59 15258 65562 248

249260224

147,29273

(7,34)(7,34)

PassedPassed

Passed

---

(34,75)2,20

(0,27)

000’s000’s000’sthebethebethebeP m’s

Number

thebethebe

thebethebe

thebe

%%

timestimesPulaPula

56 77856 39458 120

4501 375450

255,50298

10,29,9

3,00Passed

3,00

0,670,673,33

43,982,341,17

58 16257 321

58 606495

680416

287,90318

0,430,42

PassedPassed

Passed

---

1 149,842,460,38

58 16258 162

60 229300500275

174,49309

(14,12)(14,12)

PassedPassed

Passed

---

(21,15)2,29

(0,39)

Market and per share data:

Number of shares in issue at year endWeighted average shares in issueDiluted weighted average shares in issueQuoted share price at year endShare price- high for the yearShare price - low for the yearMarket capitalisation at year endNumber of shareholders at year end

Key market and per share ratios:

EPS - basicEPS - diluted

Dividend per share - ordinary Dividend per share - special

Dividend per share - total

Dividend yield - ordinary dividendDividend yield - total dividendDividend cover - total dividendPrice earnings ratioNet asset value per shareFree cash flow per share

Years ended 30 April

20122013 2011 2010 2009

Reclassified

Re-classified items:

In the 2009 financial year, the Income Statement was segmented into continuing and discontinued operations. Discontinued operations related to Imara Asset Management (Pty) Limited – Botswana which has ceased trading and is now dormant. Following a re-assessment of discontinued operations in the 2010 financial year, a decision was taken that this classification was no longer applicable and that the operations of this entity should be re-classified. Comparative financial information has been amended to take account of the re-classification.

When a Company becomes a subsidiary during the year, the statistics relating to the number of employees is computed on a weighted average basis from the date on which the Company became a subsidiary. In financial year 2013, Imara Beresford International Limited, the Mauritius registered Company became a subsidiary on 31 October 2012. In financial year 2012, Imara Capital Zimbabwe (Private) Limited became a subsidiary on 30 November 2012.

39PAGE |

GRAPHICAL FIVE-YEAR FINANCIAL HIGHLIGHTS AND RATIOS

160,000140,000120,000100,00080,00060,00040,000

0

160,000140,000120,000100,00080,00060,00040,000

02012 2013 2009 2010 2011

Revenue - P 000’s

2012 2013 2009 2010 2011

Operating expenses - P 000’s

6,0004,0002,000

0(2,000)(4,000)(6,000)(8,000)

806040200

(20)(40)(60)(80)

2012 20132009 2010 2011

Profit/(loss) after taxation - P 000’s

12,00010,0008,0006,0004,0002,000

0(2,000)(4,000)(6,000)

2012 2013 2009 2010 2011

EBITDA - P 000’s

2013 2009 2010 2011 2012

Profit/(loss) after tax per employee - P 000’s

15

10

5

0

(5)

(10)

(15)

20132009 2010 2011 2012

Earnings per share (diluted) - thebe

1,2001,000

800600400200

02012 2013 2009 2010 2011

Revenue per employee - P 000’s

4.00

3.00

2.00

1.00

02013 2009 2010 2011 2012

Dividend per share - thebe

40PAGE |

150,000

120,000

90,000

60,000

30,000

0

150,000

120,000

90,000

60,000

30,000

02012 2013 2009 2010 2011

Shareholders’ equity - P 000’s

2012 2013 2009 2010 2011

Capital employed - P 000’s

280,000240,000200,000160,000120,00080,00040,000

02012 20132009 2010 2011

Total assets - P 000’s

6420

(2)(4)(6)(8)

2012 20132009 2010 2011

Return on capital employed - %

321

0(1)(2)(3)(4)

6420

(2)(4)(6)(8)

2012 2012 2013 2013 2009 20092010 2010 2011 2011

Return on average assets - % Return on equity - %

300250200150100500

2012 20132009 2010 2011

Market capitalisation at year end - P’m

4,5004,0003,5003,0002,5002,0001,5001,000

5000

2012 2013 2009 2010 2011

Funds under management - P’m

Imara Holdings LimitedConsolidated Annual Financial Statements

Financial year ended 30 April 2013

42PAGE |

Report on the Financial Statements

We have audited the accompanying Group financial statements of Imara Holdings Limited and the company financial statements, which comprise the Statement of Financial Position as at 30 April 2013, and the Statement of Comprehensive Income, Statement of Changes in Equity and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information, as set out on pages 43-111.

Directors’ Responsibility for the Financial Statements

The company’s directors are responsible for the preparation and fair presentation of these financial statements in accordance with the International Financial Reporting Standards and in the manner required by the Companies Act of Botswana (Companies Act, 2003) and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards of Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors’ judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements give a true and fair view of the financial position of the Imara Holdings Limited Group and company as at 30 April 2013, and its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards, and in the manner required by the Companies Act of Botswana (Companies Act, 2003).

Ernst & YoungPracticing Member: Thomas Chitambo (20030022)Certified Auditor26 July 2013

INDEPENDENT AUDITOR’S REPORTTO THE MEMBERS OF IMARA HOLDINGS LIMITED

Second Floor, Plot 22Khama Cresent

PO Box 41015GaboroneBotswana



43PAGE |

RevenueOther operating income

Total income

Operating expensesCost of services sold

Operating profit / (loss)Finance costsShare of profits from associatesReversal of impairment losses / (impairment losses) on investment in associates

Profit before taxIncome tax (expense) / credit

(Loss)/profit for the year

Attributable to:Owners of the parent Non- controlling interests


Earnings per share for the year:Equity shareholders’ of the parent - Basic thebe- Diluted thebe

21 399 6612 898 683

24 298 344

(15 372 486)-

8 925 858(2 909 043)

-

-

6 016 815(967 271)

5 049 544

--

-

--

10 310 08033 390 871

43 700 951

(19 551 971)-

24 148 980(4 323 285)

-

-

19 825 695(1 370 573)

18 455 122

--

-

--

122 482 70514 959 533

137 442 238

(105 924 930)(24 385 406)

7 131 902(510 042)1 849 528

32 031

8 503 419(3 741 781)

4 761 638

5 635 305(873 667)

4 761 638

9.619.20

145 919 44518 191 196

164 110 641

(140 547 968)(19 488 607)

4 074 066(396 768)1 094 609

(1 294 653)

3 477 254(4 977 395)

(1 500 141)

(4 304 682)2 804 541

(1 500 141)

(7.34)(7.34)

23

4

513

13

6

77

Notes

Group2013Pula

Group2012Pula

Company2013Pula

Company2012Pula

Year ended 30 April

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME



44PAGE |


Other comprehensive income:

Net (loss)/gain on available-for-sale-financial assets Transfer to Income Statement on disposal of available-for-sale financial assets Income tax effect

Exchange differences on translation of foreign operationsIncome tax (expense) / benefit

Other comprehensive loss for the year, net of tax

Total comprehensive (loss)/ income for the year, net of tax

Attributable to:Owners of the parent Non-controlling interest

Total comprehensive (loss)/ income

5 049 544

(83 814)

(410 634)

326 820-

-

-

-

(83 814)

4 965 730

4 965 730-

4 965 730

18 455 122

(948)

(6 539)

5 591-

-

-

-

(948)

18 454 174

18 454 174-

18 454 174

4 761 638

(2 447 451)

1 186 015

(1 727 816)(1 905 650)

1 420 013

1 420 013

-

(1 027 438)

3 734 200

4 607 867(873 667)

3 734 200

(1 500 141)

(1 736 463)

(1 260 449)

(699 524)223 510

(1 672 592)

(1 672 592)

-

(3 409 055)

(4 909 196)

(7 713 737)2 804 541

(4 909 196)

Notes

Group2013Pula

Group2012Pula

Company2013Pula

Company2012Pula

Year ended 30 April

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME



45PAGE |

Non-current assetsEquipmentGoodwillIntangible assetsInvestment in subsidiariesInvestment in associatesAvailable-for-sale financial assetsAccounts receivable - group companiesDeferred tax assets

Current assetsListed trading securities Trade and other receivablesCash and cash equivalentsIncome tax refundable

TOTAL ASSETS

EQUITY AND LIABILITIESEquityStated capitalNon-distributable reservesDistributable reserves

Equity attributable to owners of the parent

Non-controlling interests

Total equity

Non-current liabilitiesAccounts payable - group companiesInterest bearing loans and borrowingsRetirement benefit obligation Deferred tax liabilities

Current liabilitiesTrade and other payables Listed trading securities – sold shortInterest bearing loans and borrowings Income tax payableBank overdraft

Total liabilities

TOTAL EQUITY & LIABILITIES

468 708--

55 671 0338 215 354

255 11045 942 4752 223 805

112 776 485

-1 952 943

23 462 229-

25 415 172

138 191 657

50 914 8897 856 61625 511 008

84 282 513

-

84 282 513

52 208 918---

52 208 918

1 700 226----

1 700 226

53 909 144

138 191 657

866 665--

76 117 140291 142

259 19441 749 763

874 652

120 158 556

-1 682 825

16 000 025-

17 682 850

137 841 406

50 931 0118 947 17942 191 921

102 070 111

-

102 070 111

33 495 190---

33 495 190

2 276 105----

2 276 106

35 771 295

137 841 406

5 686 468553 460

50 813-

9 557 71217 866 934

-2 341 462

36 056 849

6 408 77871 647 52584 571 232

1 237 011

163 864 546

199 921 395

50 914 88914 706 69172 109 221

137 730 801

5 790 172

143 520 973

-1 886 213

-3 568 992

5 455 205

46 794 659439 621

3 486 053145 24479 640

50 945 217

56 400 422

199 921 395

6 098 30912 813 858

234 533-

877 66921 180 571

-1 033 646

42 238 586

5 276 905134 346 123

69 805 677804 055

210 232 760

252 471 346

50 931 01112 069 282

66 208 347

129 208 640

8 550 953

137 759 593

-2 757 301

535 2052 421 586

5 714 092

105 102 46595 169

3 295 644502 264

2 119

108 997 661

114 711 753

252 471 346

91011121314156

16171819

20

15216

221621

21

Notes

Group2013Pula

Group2012Pula

Company2013Pula

Company2012Pula

Year ended 30 AprilCONSOLIDATED STATEMENT OF FINANCIAL POSITION

ASSETS



46PAGE |

Profit before tax Adjusted for non-cash items included in profit before tax:AmortisationDepreciationInterest receivedFinance costs Share of profit from associates Impairment losses / (reversal of impairment losses) on investment in associatesProfit realised from associate company on acquisition of controlling stakeShare based payment expense – OptionsNet foreign exchange differenceFair value (gains) (Profit) / loss from sale of investmentsDividends receivedProfit / (loss) on disposal of equipmentDebt forgiveness – group loans

Operating cash inflows before working capital adjustments:Increase in trading stock Decrease / (increase) in trade and other receivablesIncrease / (decrease) in trade and other payables

Cash generated from operationsIncome tax paidInterest receivedFinance costs

Net cash flows (used in) operating activities

Cash flows from investing activities:Dividends received – non-groupDividends received – associates and subsidiariesAcquisition of associatesAcquisition of non-controlling interest in subsidiaryNet cash (paid) /received on acquisition of subsidiaryNet cash received on consolidation of subsidiaryPurchase of equipment - to maintain operating capacityProceeds – sale of equipmentLoans granted to group companies(Purchase) / proceeds from sale of available-for-sale-financial assets

Net cash flows (used in) / generated from investing activities

Cash flows from financing activities:Proceeds from issue of sharesLoans (paid to)/received from group companiesIncrease in borrowingsDividends paid – equity holders of the parent & minorities in subsidiaries

Net cash flows from / (used in) financing activities

Net (decrease) / increase in cash and cash equivalentsNet foreign exchange differences on cash and cash equivalents held in foreign currencyCash and cash equivalents at beginning of year

Cash and cash equivalents at end of year

Comprising: Cash and equivalents and short term investmentsBank overdraft

Net cash and cash equivalents

3 477 254

88 7862 073 300

(3 532 957)396 768

(1 094 609)1 294 653

(1 039 005)

854 156(2 976 866)(3 200 582)

(640 770)(889 509)

4 409-

(5 184 972)882 589

(58 899 350)54 592 192

(8 609 541)(4 074 483)

3 532 957(396 768)

(9 547 835)

889 509351 303

(1 355 860)-

(264 400)-

(2 279 244)353 090

-(1 208 748)

(3 514 349)

16 123-

871 088(3 700 232)

(2 813 021)

(15 875 206)

1 187 17284 491 592

69 803 558

69 805 677(2 119)

69 803 558

8 503 421

193 2031 567 503

(3 953 775)510 042

(1 849 528)(32 031)

-

656 531(2 035 116)

-(1 823 506)(1 068 728)

35 795-

703 831(429 141)

41 328 616(57 540 197)

(15 936 891)(3 827 666)

3 953 775(510 042)

(16 320 824)

1 068 7281 909 853(589 762)

(2 160 926)529 8876 219 414

(1 207 768)436 790

-(8 070 867)

(1 864 651)

487 377-

1 886 213(441 296)

1 932 294

(16 253 201)

2 557 66898 187 125

84 491 592

84 571 232(79 640)

84 491 592

19 825 695

-191 513

(4 570 920)4 323 285

--

-

184 928(1 194 050)

-4 285

(2 002 492)(46 232)

(31 935 226)

(15 219 215)-

270 117575 878

(14 373 220)(21 420)

4 570 920(4 323 285)

(14 147 005)

2 002 492-

(1 355 860)(2 906 714)

--

(697 484)154 244

(3 160 027)(2 434)

(5 965 783)

16 12313 221 498

-(1 774 209)

11 463 412

(8 649 376)

1 187 17223 462 229

16 000 025

16 000 025-

16 000 025

6 016 815

142 800204 820

(4 234 348)2 909 043

--

-

131 610(2 970 040)

-257 459

(13 557 098)(1 000)

-

(11 099 939)-

(717 130)(793 054)

(12 610 123)(19 832)

4 234 348(2 909 043)

(11 304 650)

-13 557 098(589 763)

(2 160 926)(622 088)

(46 459)-

1 000(9 482 261)

454 899

1 111 500

487 377(4 740 187)

--

(4 252 810)

(14 445 960)

2 557 66835 350 521

23 462 229

23 462 229-

23 462 229

11925

13

13124

23 & 4

25

22 & 13

131212

9

20

18

Notes

Group2013Pula

Group2012Pula

Company2013Pula

Company2012Pula

Year ended 30 AprilCONSOLIDATED STATEMENT OF CASH FLOWS

Cash flows from operating activities:



47PAGE |

Notes

Stated capital(Note 20)

Pula

Non-distributablereserves

(See below)Pula

Distributablereserves

PulaTotalPula

Non- controlling

interestPula

Total EquityPula

135 480 043

4 761 638(1 142 645)

3 618 993

139 099 036

2 381 908

656 531

546 559

5 067 786

(4 055 356)

-596 157

(330 350)

(441 298)

143 520 973

143 520 973

(1 500 141)(2 667 666)

(4 167 807)

139 353 166

16 122

854 156

-

-

1 236 381

(1 926 023)(1 774 209)

137 759 593

2 459 416

(873 667)(115 207)

(988 874)

1 470 542

-

-

293 229

5 067 786

(1 196 244)

-596 157

-

(441 298)

5 790 172

5 790 172

2 804 541741 389

3 545 930

9 336 102

-

-

(95 507)

-

1 236 381

(1 926 023)-

8 550 953

133 020 627

5 635 305(1 027 438)

4 607 867

137 628 494

2 381 908

656 531

253 330

-

(2 859 112)

--

(330 350)

-

137 730 801

137 730 801

(4 304 682)(3 409 055)

(7 713 737)

130 017 064

16 122

854 156

95 507

-

-

-(1 774 209)

129 208 640

65 169 033

5 635 305-

5 635 305

70 804 338

-

-

-

-

-

1 635 233-

(330 350)

-

72 109 221

72 109 221

(4 304 682)-

(4 304 682)

67 804 539

-

-

-

178 017

-

-(1 774 209)

66 208 347

19 318 613

-(1 027 438)

(1 027 438)

18 291 175

-

656 531

253 330

-

(2 859 112)

(1 635 233)--

-

14 706 691

14 706 691

-(3 409 055)

(3 409 055)

11 297 636

-

854 156

95 507

(178 017)

-

--

12 069 282

48 532 981

--

-

48 532 981

2 381 908

-

-

-

-

---

-

50 914 889

50 914 889

--

-

50 914 889

16 122

-

-

-

-

--

50 931 011

26

20

26

Year ended 30 AprilCONSOLIDATED STATEMENT OF CHANGES IN EQUITY GROUP - TOTAL EQUITY

GROUP:

Issue of new shares – non-controlling interest of the subsidiary: This represents shares issued to non-controlling shareholders in a subsidiary company following the payment of a scrip dividend.

Balance - 1 May 2011

Profit /(loss)for the yearOther comprehensive loss

Total comprehensive (loss)/income

Sub-total

Issue of new sharesShare based payment expense- share options (net)Associate non-distributable reserves prior to becoming a subsidiaryAssociate reserves prior to becoming a subsidiaryAcquisition of non-controlling interest in subsidiaryTransfer of reserves relating to BEE to retained earningsAcquisition of subsidiariesDividends paid – BEE partnersDividends paid – non-controlling interest in subsidiary

Balance - 30 April 2012


(Loss) / profit for the yearOther comprehensive (loss)/income

Total comprehensive (loss)/income

Sub-total

Issue of new sharesShare based payment expense- share options (net)Associate non-distributable reserves prior to becoming a subsidiaryTransfer of NDR to retained earnings on realisation of assets Associate reserves prior to becoming a subsidiaryAcquisition of non-controlling interest in subsidiaryDividends paid




48PAGE |

Note

Stated capital(Note 20)

Pula

Non -distributablereserves

(See below)Pula

Distributablereserves

Pula


Profit for the yearOther comprehensive loss

Total comprehensive loss

Sub-total

Issue of new sharesShare based payment expense- share options (net)



Profit for the yearOther comprehensive loss

Total comprehensive income

Sub-total

Issue of new sharesShare based payment expense- share options (net)Share Based Payment Reserve – transferred from subsidiary company Dividend paid


76 278 344

5 049 544(83 814)

4 965 730

81 244 074

2 381 908656 531

84 282 513

84 282 513

18 455 122(948)

18 454 174

102 736 687

16 122854 156237 355

(1 774 209)

102 070 111

20 461 464

5 049 544-

5 049 544

25 511 008

--

25 511 008

25 511 008

18 455 122-

18 455 122

43 966 130

---

(1 774 209)

42 191 921

7 283 899

-(83 814)

(83 814)

7 200 085

-656 531

7 856 616

7 856 616

-(948)

(948)

7 855 668

-854 156237 355

-

8 947 179

48 532 981

--

-

48 532 981

2 381 908-

50 914 889

50 914 889

--

-

50 914 889

16 122---

50 931 011

Total EquityPula

Year ended 30 AprilCONSOLIDATED STATEMENT OF CHANGES IN EQUITY (continued)COMPANY – TOTAL EQUITY

COMPANY:



49PAGE |

Foreign currencytranslation

reservePula

Share basedpaymentreserve

Pula

Available-for-sale-financial

reservePula

Other reserves

Pula

GROUP:


Other comprehensive income / (loss)Associate non-distributable reserves prior to becoming a subsidiaryAcquisition of minority interest in subsidiaryTransfer of BEE reserves to retained earningsShare based payment expense - share options Share based payment expense- employees of subsidiary companiesShare based payment expense – employees of the company



Associate non-distributable reserves prior to becoming a subsidiaryTransfer of NDR to retained earnings on realisation of assets Share based payment expense - share optionsShare based payment expense- employees of subsidiary companiesShare based payment expense – employees of the company


19 318 613

(1 027 438)

253 330(2 859 112)(1 635 233)

656 531

524 921

131 610

14 706 691

14 706 691(3 409 055)

95 508

(178 018)854 156

669 228

184 928

12 069 282

-

-

-253 330

(2 859 112)---

-

(2 605 782)

(2 605 782)-

95 508

(178 018)-

-

-

(2 688 292)

6 103 114

(2 447 451)

----

-

-

3 655 663

3 655 663(1 736 463)

-

--

-

-

1 919 200

7 192 137

-

--

(1 635 233)656 531

524 921

131 610

6 213 435

6 213 435-

-

-854 156

669 228

184 928

7 067 591

6 023 362

1 420 013

----

-

-

7 443 375

7 443 375(1 672 592)

-

--

-

-

5 770 783

Totalnon-distributable

reserves(Per above)

Pula

Year ended 30 April

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (continued)GROUP - NON-DISTRIBUTABLE RESERVES



50PAGE |

Share basedpaymentreserve

Pula

Available-for-sale-financial

reservePula

COMPANY:

Balance - 1 May 2011Other comprehensive loss

Share based payment expense - share options (net)Share based payment expense - employees of subsidiary companiesShare based payment expense - employees of the company


Balance - 1 May 2012Other comprehensive loss

Share based payment expense - share options (net)Share based payment expense - employees of subsidiary companiesShare based payment expense - employees of the company

Share based payment reserve transferred from subsidiary companiesShare based payment reserve transferred from Imara Africa Securities (Proprietary) LimitedShare based payment reserve transferred from Imara Asset Management (Proprietary) Limited - Botswana


7 283 899(83 814)

7 200 085

656 531524 921131 610

7 856 616

7 856 616(948)

7 855 668

854 156

669 228184 928

237 355

225 435

11 920

8 947 179

1 726 997(83 814)

1 643 183

---

1 643 183

1 643 183(948)

1 642 235

---

-

-

-

1 642 235

5 556 902-

5 556 902

656 531524 921131 610

6 213 433

6 213 433-

6 213 433

854 156

669 228184 928

237 355

225 435

11 920

7 304 944

Totalnon-distributable

reserves(Per above)

Pula

Year ended 30 April

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (continued)COMPANY - NON-DISTRIBUTABLE RESERVES



51PAGE |

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Corporate information

The consolidated financial statements of the Group for the year ended 30 April 2013 were authorised for issue in accordance with a resolution of the directors on 26 July 2013. The Group is a limited liability company incorporated and domiciled in Botswana whose shares are publicly traded. The registered office is located at:

Union Provident TrustFirst Floor, Time Square, Plot 134, Independence Avenue,Gaborone. Botswana.

The principal activities of the Group are asset management, corporate finance advisory, stock-broking and trust administration and custodial services.

Basis of preparation

The consolidated financial statements of the Group and the financial statements of the Company have been prepared on a going concern basis in accordance with International Financial Reporting Standards (IFRS), which comprise standards approved by the International Accounting Standards Board, (IASB), and interpretations approved by the International Financial Reporting Interpretations Committee, (IFRIC), and the applicable requirements of the Botswana Companies Act, 2003.

The financial statements have been prepared on an historical cost basis except for certain financial instruments that are carried at fair value.

The consolidated financial statements are presented in Pula, the currency of Botswana.

Basis of consolidation

The consolidated financial statements comprise the financial statements of Imara Holdings Limited and its subsidiaries drawn up to 30 April each year. All intra-group balances, transactions, income and expenses are eliminated in full on consolidation.

Subsidiaries are consolidated from the date on which control is transferred to the Group and cease to be consolidated from the date on which control is transferred out of the Group.

Control is the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.

The subsidiaries have the same reporting date as the holding company and apply consistent accounting policies.

Non-controlling interests represent the portion of profit or loss and net assets not held by the Group and are presented separately in the Income Statement and within equity in the Statement of Financial Position, separately from parents’ shareholders’ equity.

Total comprehensive income within a subsidiary is attributable to the non-controlling interest even if that results in a deficit balance.

Investments in subsidiaries are carried at cost at a company level.

Borrowing costs

Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalised as part of the cost of the respective asset. All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.

Changes in accounting policies

The accounting policies applied are consistent with those of the previous financial year, except as follows:The Group has adopted the following new and amended IFRS and IFRIC interpretations during the year. Adoption of these revised standards and interpretations did not have any financial effect on the financial statements of the Group. They did however give rise to additional disclosures, including in some cases, revisions to accounting policies. Only those amendments that impact the Group have been disclosed.

IAS 12 – Income Taxes- Recovery of Underlying Assets (Amendment)- 1 January 2012

The amendment clarified the determination of deferred tax on investment property measured at fair value. The amendment introduces a rebuttable presumption that deferred tax on investment property measured using the fair value model in IAS 40 should be determined on the basis that its carrying amount will be recovered through sale. Furthermore, it introduces the requirement that deferred tax on non-depreciable assets that are measured using the revaluation model in IAS 16 always be measured on a sale basis of the asset. The amendment becomes effective for annual periods beginning on or after 1 January 2012.This amendment does not impact the Group as the Group does not have any investment properties.



52PAGE |

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Changes in accounting policies (continued)

IFRS 1 Severe Hyperinflation and Removal of Fixed Dates for First-time adopters (Amended) – 1 July 2011

Amendments to IFRS 1 First-time Adoption of International Financial Reporting Standards was issued in December 2010. The amendments replace references to a fixed transition date with ‘the date of transition to IFRSs’ and set out the requirements for how an entity resumes presenting financial statements in accordance with IFRSs after a period when the entity was unable to comply with IFRSs because its functional currency was subject to severe hyperinflation. The amendments are effective from 1 July 2011, with earlier application permitted. The Group does not expect any impact on its financial position or performance.

IFRS 7 Financial Instruments: Disclosures - Enhanced De-recognition Disclosure Requirements (Amendment)-1 July 2011

The amendment requires additional disclosure about financial assets that have been transferred but not derecognised to enable the user of the Group’s financial statements to understand the relationship with those assets that have not been derecognised and their associated liabilities. In addition, the amendment requires disclosures about continuing involvement in derecognised assets to enable the user to evaluate the nature of, and risks associated with, the entity’s continuing involvement in those derecognised assets. The amendment becomes effective for annual periods beginning on or after 1 July 2011. The amendment affects disclosure only and has no impact on the Group’s financial position or performance.

Improvements to IFRS (May 2010)

In May 2010 the Board issued its second omnibus of amendments to its standards, primarily with a view to removing inconsistencies and clarifying wording. The various improvements became effective for the annual periods with year-end beginning on or after 1 January 2011. There are separate transitional provisions for each standard. The adoption of the amendments did not have any impact on the financial position or performance of the Group.

International Financial Reporting Standards (IFRS’s) and interpretations (IFRIC’s) issued and revised but not yet effective:

Reference

IAS 1 Financial Statement Presentation – Presentation of Items of Other Comprehensive Income (Amendment)

IAS 19 Employee Benefits (Amendment)

IAS 27 Separate Financial Statements (as revised in 2011)

IAS 28 Investments in Associates and Joint Ventures (as revised in 2011)

1 July 2012

1 January 2013

1 January 2013

1 January 2013

The amendments to IAS 1 change the grouping of items presented in OCI. Items that could be reclassified (or ‘recycled’) to profit or loss at a future point in time (for example, upon de-recognition or settlement) would be presented separately from items that will never be reclassified. The amendment affects presentation only and has there no impact on the Group’s financial position or performance. The amendment becomes effective for annual periods beginning on or after 1 July 2012.

The IASB has issued numerous amendments to IAS 19. These range from fundamental changes such as removing the corridor mechanism and the concept of expected returns on plan assets to simple clarifications and re-wording. The Group is currently assessing the full impact of the amendments. The amendment becomes effective for annual periods beginning on or after 1 January 2013.

As a consequence of the new IFRS 10 and IFRS 12, what remains of IAS 27 is limited to accounting for subsidiaries, jointly controlled entities, and associates in separate financial statements. The amendment becomes effective for annual periods beginning on or after 1 January 2013.

As a consequence of the new IFRS 11 and IFRS 12. IAS 28 has been renamed IAS 28 Investments in Associates and Joint Ventures, and describes the application of the equity method to investments in joint ventures in addition to associates. The amendment becomes effective for annual periods beginning on or after 1 January 2013.

Name Effective date



53PAGE |


SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)


International Financial Reporting Standards (IFRS’s) and interpretations (IFRIC’s) issued and revised but not yet effective: (continued):

Reference Name Effective date

IFRS 1Government Loans (Amendment)

IFRS 7 Financial Instruments: Disclosures — Enhanced Disclosures on Financial Assets and Financial Liabilities(Amendment)

IFRS 9 Financial Instruments: Classification and Measurement

IFRS 10 Consolidated Financial Statements

1 January 2013

1 January 2013

1 January 2015

1 January 2013

These amendments require first-time adopters to apply the requirements of IAS 20 Accounting for Government Grants and Disclosure of Government Assistance, prospectively to government loans existing at the date of transition to IFRS. Entities may choose to apply the requirements of IFRS 9 (or IAS 39, as applicable) and IAS 20 to government loans retrospectively if the information needed to do so had been obtained at the time of initially accounting for that loan. The exception would give first-time adopters relief from retrospective measurement of government loans with a below-market rate of interest. The amendment is effective for annual periods on or after 1 January 2013. The amendment has no impact on the Group.

These amendments require an entity to disclose information about rights to set-off and related arrangements (e.g. collateral agreements). The disclosures would provide users with information that is useful in evaluating the effect of netting arrangements on an entity’s financial position. The new disclosures are required for all recognised financial instruments that are set off in accordance with IAS 32 Financial Instruments: Presentation. The disclosures also apply to recognised financial instruments that are subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are set off in accordance with IAS 32. These amendments will not impact the Group’s financial position or performance and become effective for annual periods beginning on or after 1 January 2013.

IFRS 9, as issued, reflects the first phase of the IASB’s work on the replacement of IAS 39 and applies to classification and measurement of financial assets and financial liabilities as defined in IAS 39. The standard was initially effective for annual periods beginning on or after 1 January 2013, but Amendments to IFRS 9 Mandatory Effective Date of IFRS 9 and Transition Disclosures, issued in December 2011, moved the mandatory effective date to 1 January 2015. In subsequent phases, the IASB will address hedge accounting and impairment of financial assets.

The adoption of the first phase of IFRS 9 will have an effect on the classification and measurement of the Group’s financial assets, but will not have an impact on classification and measurements of financial liabilities. The Group will quantify the effect in conjunction with the other phases, when the final standard including all phases is issued.

IFRS 10 replaces the portion of IAS 27 Consolidated and Separate Financial Statements that addresses the accounting for consolidated financial statements. It also includes the issues raised in SIC-12 Consolidation — Special Purpose Entities. IFRS 10 establishes a single control model that applies to all entities including special purpose entities.

The changes introduced by IFRS 10 will require management to exercise significant judgement to determine which entities are controlled, and therefore, are required to be consolidated by a parent, compared with the requirements that were in IAS 27. This standard becomes effective for annual periods beginning on or after 1 January 2013.



54PAGE |


SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)


International Financial Reporting Standards (IFRS’s) and interpretations (IFRIC’s) issued and revised but not yet effective:(continued)

Reference Name Effective date

IFRS 11 Joint Arrangements

IFRS 12 Disclosure of Involvement with Other Entities

IFRS 13 Fair Value Measurement

IFRIC 20 Stripping Costs in the Production Phase of a Surface Mine

IFRIC 21Levies

Improvements to IFRSs

1 January 2013

1 January 2013

1 January 2013

1 January 2013

1 January 2014

1 January 2013

IFRS 11 replaces IAS 31 Interests in Joint Ventures and SIC-13 Jointly-controlled Entities — Non-monetary Contributions by Venturers. IFRS 11 removes the option to account for jointly controlled entities (JCEs) using proportionate consolidation. Instead, JCEs that meet the definition of a joint venture must be accounted for using the equity method. The application of this new standard will impact the financial position of the Group. This is due to the cessation of proportionate consolidating the joint venture to equity accounting for this investment. This standard becomes effective for annual periods beginning on or after 1 January 2013.

IFRS 12 includes all of the disclosures that were previously in IAS 27 related to consolidated financial statements, as well as all of the disclosures that were previously included in IAS 31 and IAS 28. These disclosures relate to an entity’s interests in subsidiaries, joint arrangements, associates and structured entities. A number of new disclosures are also required. This standard becomes effective for annual periods beginning on or after 1 January 2013.

IFRS 13 establishes a single source of guidance under IFRS for all fair value measurements. IFRS 13 does not change when an entity is required to use fair value, but rather provides guidance on how to measure fair value under IFRS when fair value is required or permitted. The Group is currently assessing the impact that this standard will have on the financial position and performance. This standard becomes effective for annual periods beginning on or after 1 January 2013.This interpretation applies to waste removal (stripping) costs incurred in surface mining activity, during the production phase of the mine. The interpretation addresses the accounting for the benefit from the stripping activity. The new interpretation will not have an impact on the Group.

This IFRIC Interpretation clarifies the accounting for levies imposed on Governments. The Group is currently assessing the impact of this interpretation.These improvements will not have an impact on the Group, but include:IFRS 1 First-time Adoption of International Financial Reporting StandardsThis improvement clarifies that an entity that stopped applying IFRS in the past and chooses, or is required, to apply IFRS, has the option to re-apply IFRS 1. If IFRS 1 is not re-applied, an entity must retrospectively restate its financial statements as if it had never stopped applying IFRS.

IAS 1 Presentation of Financial StatementsThis improvement clarifies the difference between voluntary additional comparative information and the minimum required comparative information. Generally, the minimum required comparative information is the previous period.

IAS 16 Property Plant and EquipmentThis improvement clarifies that major spare parts and servicing equipment that meet the definition of property, plant and equipment are not inventory.

IAS 32 Financial Instruments, PresentationThis improvement clarifies that income taxes arising from distributions to equity holders are a ccounted for in accordance with IAS 12 Income Taxes.

IAS 34 Interim Financial ReportingThe amendment aligns the disclosure requirements for total segment assets with total segment liabilities in interim financial statements. This clarification also ensures that interim disclosures are aligned with annual disclosures.

These improvements are effective for annual periods beginning on or after 1 January 2013.



55PAGE |



Cost of services sold

Cost of services sold consists of all direct costs associated with revenue generation inclusive of sub-contractor expenses and recoverable and non-recoverable disbursements.

Equipment

Equipment is stated at cost less accumulated depreciation and accumulated impairment losses if any. Such cost includes the cost of significant replacement components for equipment. All other repair and maintenance costs are recognised in the Income Statement as incurred.

Depreciation is computed on a straight line basis over the estimated useful life to reduce the asset’s value to residual value as follows: Electronic library 10%Motor vehicles 20% Office equipment 10% - 33.33%

It is the policy to apportion depreciation in the year of acquisition and disposal. The carrying amounts are reviewed for impairment when events or changes in circumstance indicate that the carrying value may not be recoverable.

An item of equipment is de-recognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on de-recognition of the asset, (calculated as the difference between the net disposal proceeds and the carrying amount of the asset), is included in the Income Statement in the year of de-recognition.Residual values, useful lives and methods of depreciation are reviewed on an annual basis.

Fiduciary activities

The Group acts in fiduciary capacities that result in the holding, placing or managing of assets for the account of and at the risk of clients. As these are not assets of the Group, they are not reflected in the Statement of Financial Position but are included as a note to the financial statements at market value as part of funds under management. (Note 24 )

Financial instruments:

Financial assets: Initial recognition

Subsequent measurement

The measurement of financial assets depends on their classification as follows:

Financial assets in the scope of IAS 39 are classified as financial assets at fair value through profit or loss, loans and receivables, held to maturity investments, and available-for-sale-assets as appropriate. The Group determines the classification of its financial instruments at initial recognition.

Financial assets are recognised initially at fair value, plus in the case of investments not at fair value through profit and loss, directly attributable transaction costs.

Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place (regular way purchases) are recognised on the trade date, being the date on which the Group commits to purchase or sell an asset.

The Group’s financial assets include listed trading securities, unlisted trading securities, trade and other receivables, loan and other receivables and cash and cash equivalents.

Financial assets at fair value through profit and loss

Financial assets at fair value through profit and loss include financial assets held for trading and financial assets designated upon initial recognition at fair value through profit and loss. Financial assets are classified as held for trading if they are acquired for the purpose of selling in the near term. This category includes derivative financial instruments entered into by the Group that do not meet the hedge accounting criteria as defined in IAS 39.

Financial assets at fair value through profit and loss are carried in the Statement of Financial Position at fair value, with gains and losses recognised in the Income Statement.

The Group determines the classification of its financial assets at initial recognition and where appropriate re-evaluates this designation.



56PAGE |



Financial instruments (continued)

Subsequent measurement (continued)

Financial liabilities:

Initial recognition

Loans and other receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. Such financial assets are carried at amortised cost using the effective interest rate method. Gains and losses are recognised in the Income Statement when the loans and receivables are de-recognised or impaired, as well as through the amortisation process.

Available-for-sale financial assets

Available-for-sale financial assets are non-derivative financial assets that are designated as available-for-sale or are not classified in any of the preceding categories. Certain listed securities are classified as available for sale financial assets. After initial measurement, available-for-sale-financial assets are measured at fair value with unrealised gains or losses recognised in Other Comprehensive Income until the investment is de-recognised, at which time the cumulative gain or loss recorded in equity is recognised in the Income Statement. When available-for-sale-financial assets are determined to be impaired, the cumulative loss recorded in Other Comprehensive Income is recognised in the Income Statement.

Listed trading securities

Listed trading securities are non-derivative financial assets that are actively traded in organised financial markets. Fair value is determined by reference to quoted market bid prices at the close of business on the balance sheet date. Certain listed trading securities are classified as fair value through profit and loss financial assets. Gains and losses are recognised in the Income Statement when the listed trading securities are de-recognised or impaired.

Unlisted securities

Unlisted securities are non-derivative financial assets where there is no quoted market price. Unlisted securities are classified as available-for-sale-financial assets. Fair value is determined using valuation techniques. Such techniques may include using recent arm’s length market transactions, reference to the current market value of another financial instrument which is substantially the same or is based on the expected cash flow of the underlying net asset base of the investment.

Trade receivables

Trade receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. After initial recognition, trade receivables are carried at amortised cost using the effective interest rate method less any allowance for impairment. Gains and losses are recognised in the Income Statement when the trade receivables are de-recognised or impaired, as well as through the amortisation process.

Cash and cash equivalents

Cash and cash equivalents are defined as cash on hand, demand deposits and short-term, highly liquid investments readily convertible to known amounts of cash and subject to insignificant risk of changes in value. After initial recognition, cash and cash equivalents are subsequently carried at amortised cost.

For the purposes of the Consolidated Cash Flow Statement, cash and cash equivalents consists of cash and cash equivalents as defined above, net of outstanding bank overdrafts.

Financial liabilities within the scope of IAS 39 are classified as financial liabilities at fair value through profit or loss and loans and borrowings. The Group determines the classification of its financial liabilities at initial recognition.Financial liabilities are recognised initially at fair value and in the case of loans and borrowings, directly attributable transaction costs.

The Group’s financial liabilities include trade and other payables, bank overdraft and loans and borrowings.



57PAGE |



Financial liabilities (continued)

Subsequent measurement

The measurement of financial liabilities depends on their classification as follows:

Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss includes financial liabilities held for trading, financial liabilities designated upon initial recognition as at fair value through profit or loss and option liabilities which arose as a result of the South African BEE transaction with Zingwenya Holdings (Proprietary) Limited in 2008.

Financial liabilities are classified as held for trading if they are acquired for the purpose of selling in the near term. This category includes derivative financial instruments entered into by the Group that do not meet the hedge accounting criteria as defined by IAS39.

Gains or losses on liabilities held for trading are recognised in the Income Statement.

The Group has not designated any financial liabilities as at fair value through profit or loss.

Loans and borrowings

After initial recognition, interest bearing loans and borrowings are subsequently measured at amortised cost using the effective interest rate method. Gains and losses are recognised in the Income Statement when the liabilities are derecognised as well as through the amortisation process.

Trade payables

Trade payables are financial liabilities with fixed or determinable payments. After initial recognition, trade payables are carried at amortised cost using the effective interest rate method. Gains and losses are recognised in the Income Statement when the trade payables are de-recognised.

Offsetting of financial instruments

Financial assets and financial liabilities are offset and the net amount reported in the Statement of Financial Position if, and only if, there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, or to realize the assets and settle the liability simultaneously.

Amortised cost of financial instruments

Amortised cost is computed using the effective interest method less any allowance for impairment and principle repayment or reduction. The calculation takes into account any premium or discount on acquisition and includes transaction costs and fees that are an integral part of the effective interest rate.

The effective interest rate method of amortisation is included in finance costs in the Income Statement.

Impairment of financial assets

The Group assesses at each reporting date whether there is any objective evidence that a financial asset or a group of financial assets is impaired. A financial asset or a group of financial assets is deemed to be impaired if, and only if, there is objective evidence of impairment as a result of one or more events that has occurred after the initial recognition of the asset (an incurred “loss event”) and that loss event has an impact on the estimated future cash flows of the financial asset or the group of financial assets that can be reliably estimated.

Evidence of impairment may include indications that the debtors or group of debtors is experiencing significant financial difficulty, default or delinquency in interest or principal payments, the probability that they will enter bankruptcy or other financial reorganisation and where observable data indicate that there is a measureable decrease in the estimated future cash flow, such as changes in arrears or economic conditions that correlate with defaults.

Financial assets carried at amortised cost

For amounts due from loans and receivables to customers carried at amortised cost, the Group first assesses individually whether objective evidence of impairment exists individually for financial assets that are individually significant or collectively for financial assets that are not individually significant.

If the Group determines that no objective evidence of impairment exists for an individually assessed financial asset, whether significant or not, it includes the asset in a group of financial assets with similar credit risk characteristics and collectively assesses them for impairment. Assets that are individually assessed for impairment and for which an impairment loss is, or continues to be, recognised are not included in a collective assessment of impairment.



58PAGE |



De-recognition of financial instruments

Financial assets carried at amortised cost (continued)

If there is objective evidence that an impairment loss has been incurred, the amount of the loss is measured as the difference between the assets carrying amount and the present value of estimated future cash flows (excluding future expected credit losses that have not yet been incurred). The carrying amount of the asset is reduced through the use of an allowance account and the amount of the loss is recognised in the Income Statement. Interest income continues to be accrued on the reduced carrying amount based on the original effective interest rate of the asset. Loans together with the associated allowance are written off when there is no realistic prospect of future recovery and all collateral has been realised or has been transferred to the Group.

If, in a subsequent year, the amount of the estimated impairment loss increases or decreases because of an event occurring after the impairment was recognised, the previously recognised impairment loss is increased or reduced by adjusting the allowance account. If a write-off is later recovered, the recovery is recognised in the Income Statement.

The present value of the estimated future cash flows is discounted at the financial asset’s original effective interest rate. If a loan has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate.

Available-for-sale financial investment

For available-for-sale financial investments, the Group assesses at each reporting date whether there is objective evidence that an investment or a group of investments is impaired.

In the case of equity investments classified as available-for-sale, objective evidence would include a significant or prolonged decline in the fair value of the investment below its cost. Where there is evidence of impairment, the cumulative loss – measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that investment previously recognised in the Income Statement – is removed from equity and recognised in the Statement of Comprehensive Income. Impairment losses on equity investments are not reversed through the Income Statement, while increases in their fair value after impairment are recognised in Other Comprehensive Income.

In the case of debt instruments classified as available-for-sale, impairment is assessed based on the same criteria as financial assets carried at amortised cost. However the amount recorded for impairment is the cumulative loss, measured as the difference between amortised cost and the current fair value, less any impairment loss on the investment previously recognised in the Income Statement. Interest continues to be accrued at the original effective interest rate on the reduced carrying amount of the asset and is recorded as part of ‘Interest received’. If, in a subsequent year, the fair value of a debt instrument increases and the increase can be objectively related to an event occurring after the impairment loss was recognised in the Income Statement, the impairment loss is reversed through the Income Statement.

Fair value of financial instruments

The fair value of financial instruments that are traded in active markets is determined at each reporting date, by reference to the quoted market prices or dealer price quotations (bid price for long positions and offer price for short positions), without any deduction for transaction costs.

For financial instruments not traded in an active market, the fair value is determined using appropriate valuation techniques. Such techniques may include:

• Using arm’s length market transactions;• Reference to the current value of another instrument that is substantially the same;• A discounted cash flow analysis or other valuation model.

Financial assets

A financial asset (or where applicable a part of a financial asset or part of a group of similar financial assets) is de-recognised when:

When the Group has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, and has neither transferred nor retained substantially all the risks and rewards of the asset nor transferred control of the asset, a new asset is recognised to the extent of the Group’s continuing involvement in the asset.

the rights to receive cash flows from the asset have expired; orthe Group has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ‘pass-through’ arrangement; and either (a) the Group has transferred substantially all the risks and rewards of the asset, or (b) the Group has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

••



59PAGE |



De-recognition of financial instruments (continued)

Financial assets (continued)

Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Group could be required to repay.When continuing involvement takes the form of a written and/or purchased option (including a cash settled option or similar provision) on the transferred asset, the extent of the Group’s continuing involvement is the amount of the transferred asset that the Group may repurchase, except that in the case of a written put option (including a cash settled option or similar provision) on an asset measured at fair value, the extent of the Group’s continuing involvement is limited to the lower of the fair value of the transferred asset and the option exercise price.

Financial liabilities

A financial liability is de-recognised when the obligation under the liability is discharged or cancelled or expires.

When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a de-recognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognised in the Income Statement.

Goodwill

Goodwill is tested for impairment annually at 30 April and when circumstances indicate that the carrying value may be impaired.

The following criteria are also applied in assessing impairment of specific assets:

Impairment is determined for goodwill by assessing the recoverable amount of each cash-generating unit (or group of cash-generating units) to which the goodwill relates. Where the recoverable amount of the cash-generating unit is less than their carrying amount an impairment loss is recognised. Impairment losses relating to goodwill cannot be reversed in future periods.

Intangible assets

Intangible assets are tested for impairment annually as at 30 April either individually or at the cash-generating unit level, as appropriate and when circumstances indicate that the carrying value may be impaired. Intangible comprise a client data base and non-voting management shares in the Imara Global Fund.

Impairment of non-financial assets

The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Group estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or cash-generating units (“CGU”) fair value less costs to sell and its value in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time and value of money and the risks specific to the asset. In determining fair value less costs to sell, recent market transactions are taken into account, if available. If no such transaction can be identified, an appropriate valuation model is used. Where appropriate, these valuation results are corroborated by valuation multiples, quoted share prices for publicly traded proxy companies or other available fair value indicators.

Impairment losses are recognised in the Income Statement in those expense categories consistent with the function of the impaired asset, except for property previously re-valued where the revaluation was taken to Other Comprehensive Income. In this case the impairment is also recognised in Other Comprehensive Income up to the amount of any previous revaluation.

For assets excluding goodwill, an assessment is made at each reporting date as to whether there is any indication that previously recognised impairment losses may no longer exist or may have decreased. If such indication exists, the Group estimates the asset’s or CGU recoverable amount. A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the asset’s recoverable amount since the last impairment loss was recognised. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in the Income Statement unless the asset is carried at re-valued amount, in which case the reversal is treated as a revaluation increase.



60PAGE |



Financial assets carried at amortised cost (continued)

Leases

The determination of whether an arrangement is, or contains a lease, is based on the substance of the arrangement, at inception date of whether or not the fulfilment of the arrangement is dependent on the use of a specific asset or assets or the arrangement conveys a right to use the asset.

Group as lessee

Finance leases, which transfer to the Group substantially all the risks and benefits incidental to ownership of the leased item, are capitalised at the commencement of the lease at the fair value of the leased property or, if lower, at the present value of the minimum lease payments. Lease payments are apportioned between the finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges and any transaction costs are charged directly to Income Statement.

Capitalised leased assets are depreciated over the shorter of the estimated useful life of the asset or the lease term, if there is no reasonable certainty that the Group will obtain ownership by the end of the lease term.

Leases where the lessor retains substantially all the risks and benefits of ownership of the asset are classified as operating leases.

Operating lease payments are recognised as an expense in the Income Statement on a straight line basis over the lease term.

Group as lessor

Leases, where the Group does not transfer substantially all the risks and benefits of ownership of the asset, are classified as operating leases.

Operating lease rentals are recognised in the Income Statement when the lessor’s right to receive the rental is established.

Foreign currency translation

The consolidated financial statements are presented in Pula, (“P”), the currency of Botswana. The Pula is the functional and presentation currency of the parent company and that of the Group.

Each entity in the Group determines its own functional currency and items included in the financial statements of each entity are measured using that functional currency. Transactions in foreign currencies are initially recorded at the functional currency rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the rate of exchange ruling at the reporting date. All differences are taken to the Income Statement. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates as at the dates of the initial transaction. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined.

The assets and liabilities of overseas subsidiaries are translated into Pula, at the rate of exchange ruling at the reporting date.

The Income Statements of overseas subsidiaries are translated at weighted average exchange rates for the year. The exchange differences arising on the retranslation are recognised in Other Comprehensive Income. On disposal of a foreign entity, accumulated exchange differences are recognised in the Income Statement when the gain or loss on disposal is recognised.

Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the acquired company and are recorded at the closing exchange rate.

Goodwill and business combinations

Business combinations are accounted for using the acquisition method. The cost of an acquisition is measured as the aggregate of the consideration transferred, measured at acquisition date fair value and the amount of any non-controlling interest in the acquiree. For each business combination, the Group elects whether it measures the non-controlling fair value in the acquiree at fair value or the proportional cost of the acquiree’s identifiable net assets. Acquisition costs incurred are expensed and included in profit and loss.

When the Group acquires, it assesses the financial assets and liabilities assumed for appropriate classification and designation in accordance with the contractual arrangements, economic circumstances and pertinent conditions. This includes the separation of embedded derivatives in host contracts by the acquiree.

If the business combination is achieved in stages, the acquisition date fair value of the acquirer’s previously held equity interest in the acquiree is remeasured to fair value at the acquisition date through profit and loss.

Any contingent consideration to be transferred to the acquirer will be recognised at fair value at the acquisition date. Subsequent changes to the fair value of the contingent consideration that is deemed to be an assets or liability will be recognised in accordance with IAS 39 either in profit and loss or as a change to Other Comprehensive Income. If the contingent consideration is classified as equity, it will not be remeasured. Subsequent settlement is accounted for within equity. In instances where the contingent consideration does not fall within the scope of IAS 39, it is measured in accordance with the appropriate IFRS.



61PAGE |



Goodwill and business combinations (continued)

Goodwill is initially measured at cost, being the excess of the aggregate of the consideration transferred and the amount recognised for non-controlling interest, over the net identifiable assets acquired and liabilities assumed. If this consideration is lower than the fair value of the net assets of the subsidiary acquired, the difference is recognised in profit and loss.

After initial recognition, goodwill is measured at cost less any accumulated impairment losses. For the purpose of impairment testing, goodwill acquired in a business combination is from the acquisition date, allocated to each of the Group’s cash generating units that are expected to benefit from the synergies of the combination, irrespective of whether other assets or liabilities of the acquiree are assigned to those units.

Where goodwill forms part of a cash-generating unit and part of the operation within that unit is disposed of, the goodwill associated with the operation disposed of is included in the carrying amount of the operation when determining the gain or loss on disposal of the operation. Goodwill disposed of in this circumstance is measured based on the relative values of the operation disposed of and the portion of the cash-generating unit retained.

Income taxes

Current income tax assets and liabilities for the current period are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used in computing the amount are those that are enacted or substantially enacted at the reporting date in the countries where the Group operates and generates taxable income.

Current income tax relating to items recognised directly in equity is recognized in equity are not in the Income Statement. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.

Deferred income tax is provided, using the liability method, on all temporary differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes, at the reporting date. Deferred tax liabilities are recognised for all taxable temporary differences except:

Deferred tax assets are recognised for all deductible temporary differences, the carry-forward of unused tax credits and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry-forward of unused tax credits and unused tax losses can be utilised except:

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred income tax assets are reassessed at each reporting date and are recognised to the extent that it is probable that future taxable income will allow the deferred tax asset to be recovered.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the assets is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.

Deferred tax relating to items recognised outside profit and loss is recognised outside profit and loss. Deferred tax items are recognised in correlation to the underlying transaction either in other comprehensive income or directly in equity.

Deferred tax assets and liabilities are offset if a legally enforceable right exists to set off current tax assets against current income tax liabilities and the deferred taxes relate to the same taxable entity and the same tax authority.

Tax benefits acquired as part of a business combination, but not satisfying the criteria for separate recognition at that date, would be recognised subsequently if new information about facts and circumstances changed. The adjustment would either be treated as a reduction to goodwill (as long as it does not exceed goodwill) if it was incurred during the measurement period or in profit and loss.

where the deferred tax liability arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit or loss nor taxable profit or loss; andin respect of taxable temporary differences associated with investments in subsidiaries, associates and interest in joint ventures, when the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future.

•

•

when the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit and loss; andin respect of deductible temporary differences associated with investments in subsidiaries, associates and interest in joint ventures, deferred tax assets are recognised only to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which the temporary differences can be utilised.

•

•



62PAGE |



Intangible assets

Intangible assets acquired separately are measured on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less any accumulated amortisation and any accumulated impairment losses.

The intangible assets of the Group are assessed as having a finite useful life.

Intangible assets with finite useful lives are amortised over their useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method is reviewed at least at each financial year end. Changes in the expected useful life or the expected pattern of consumption of the future economic benefit embodied in the asset are accounted for by changing the amortisation period or method, as appropriate, and are treated as changes in accounting estimates. The amortisation expense on intangible assets with finite lives is recognised in the Income Statement in the expense category consistent with the function of intangible assets.

Gains or losses arising from de-recognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the Income Statement when the asset is de-recognised.

The Group’s intangible assets are amortised on a straight line basis over a five year period.

Investment in associates

The Group’s investment in associates, are accounted for using the equity method of accounting. An associate is an entity in which the Group has significant influence.

Under the equity method, the investment in the associate is carried in the Statement of Financial Position at cost plus post acquisition changes in the Group’s share of the net assets of the associate. Goodwill relating to the associate is included in the carrying amount the investment and is not amortised or separately tested for impairment.

The Income Statement reflects the share of the results of operations of the associates. Where there has been a change recognised directly in the equity of the associate, the Group recognises its share of any changes and discloses this, when applicable, in the Statement of Changes in Equity. Unrealised gains and losses resulting from transactions between the Group and the associate are eliminated to the extent of the interest in the associate.

The Group’s share of profit of associates is shown on the face of the Income Statement. This is the profit attributable to equity holders of the associate and, therefore, is profit after tax and non-controlling interests in the subsidiaries of the associates.After application of the equity method, the Group determines whether it is necessary to recognise an additional impairment loss to the Group’s investment in its associates. The Group determines at each reporting date whether there is any objective evidence that the investment in the associate is impaired. If this is the case the Group calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value and recognises the amount in the share of profit of an associate in the Income Statement.

The reporting dates of the associates differ from those of the holding company. In the case of Stockbrokers Malawi Limited, the reporting date is 31 December 2012. The majority shareholder in this company is unwilling to change the reporting date to bring it into line with the rest of the Imara Group. The reporting date for Imara Capital Zimbabwe (Private) Limited is 31 March 2013. Adjustments are made for the effects of any significant transactions or events that occur between the reporting date of the associate and that of the Group.

The accounting policies of associates conform to those used by the Group for like transactions and events in similar circumstances.

Upon loss of significant influence over an associate, the Group measures and recognises any retaining investment at its fair value. Any difference between the carrying amount of the associate, upon loss of significant influence, and the fair value of the retained investment and proceeds from the disposal, is recognised in profit and loss.

Pensions and other post-employment benefits

The Group does not provide pensions and other post-employment benefits for its employees, other than in Botswana where it provides for severance benefits mandated by the Employment Act. The severance benefit is a non-contributory benefit plan with the benefit determined based on length of service, basic salary and a five year employment cycle. Expenses are recognised in the Income Statement as incurred. The severance benefit is not subject to periodic actuarial valuation.

Provisions

Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. The expense relating to any provision is presented in the Income Statement, net of any expected reimbursement. If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects the risks specific to the liability.



63PAGE |



Revenue recognition

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Revenue is measured at the fair value of the consideration received, excluding discounts, rebates, sales tax and duties.

The following specific recognition criteria must also be met before revenue is recognised:

Share based payment transactions

Employees (including senior executives) of the Group receive remuneration in the form of share-based payment transactions, whereby employees render services in consideration for equity instruments. The Group’s share option scheme is defined as an “equity settled scheme”. In terms of the Group’s Share Option Scheme, equity-settled awards cannot be cancelled.

The cost of equity-settled transactions is measured by reference to the fair value at the date on which the option was granted. The fair value is determined by an external valuer using a binomial valuation model. Details of the valuation model used are given in Note 26.

The cost of equity-settled transactions is recognised in the Income Statement as part of “operating expenses”, with a corresponding increase to the Share Based Payment Reserve, in equity. The Income Statement expense or credit for a period represents the movement in the cumulative expense recognised as at the beginning and end of that period. No expense is recognised for awards that do not ultimately vest, except for equity-settled transactions, for which vesting is conditional upon a market or non-vesting condition. These are treated as vesting irrespective of whether or not the market or non-vesting condition is satisfied, provided that all other performance and/or service conditions are satisfied.

Where the terms of an equity-settled award are modified, as a minimum, an expense is recognised at the date of modification, as if the terms had not been modified. In addition, an expense is recognised for any modification, which increases the total fair value of the share-based payment arrangement or is otherwise beneficial to the holder.The dilutive effect of outstanding options is reflected as additional share dilution in the computation of earnings per share (Note 7).

Asset management investment and advisory fees:Revenue is recognised when the related services have been performed;Asset management performance fees:Revenue is recognised when the related services have been performed and performance fee criteria measured;Brokerage:Brokerage revenue, commissions, handling fees and sponsor broker fees are recognised upon performance of services, net of value added taxes and discounts;Commission:Commissions are recognised as revenue when the related services have been performed;Corporate finance mandate and advisory fees:Revenue is recognised when the related services have been performed except for those fees relating to transactions where fees are contingent. In such cases fees are only recognised upon the fulfilment of the contingent event;Dividends:Revenue is recognised when the shareholders’ right to receive the payment is established; Fee income:Fee income is recognised as revenue when the related services have been performed;Futures trading:Revenue comprises securities trading profits, which are earned for facilitating the acquisition of single stock futures by clients. Revenue is recognised when the service is provided;Interest:Revenue is recognised as the interest accrues (taking into account the effective yield on the asset);Management fees – Group:Revenue is recognised on an accrual basis in respect of intra-group services rendered;Securities trading:Revenue is recognised based on changes in the fair value of the listed securities traded, net of charges. Realised gains or losses are recognised when the transaction is settled. Unrealised gains and losses are recognised at the end of each monthly reporting period:Trust fees:Include fees for trust registration, custodial and administration services. Trust registration and custodial fees are payable annually in advance and are recognised when the right to receive payment is established, net of value added tax and discounts. Trust administration fees are recognised upon performance of services, net of value added taxes and discounts.

•

•

•

•

•

•

•

•

•

•

•

•



64PAGE |



Stated capital

Stated capital comprises of ordinary issued shares and share premium. Stated capital is recognised at the fair value of the consideration received by the Group. Expenses relating to the issuance of shares are charged to the Income Statement as incurred.

Significant accounting estimates and judgements

The Group makes estimates and assumptions that affect the reported amounts of assets and liabilities within the next financial year. Estimates and judgements are regularly evaluated and are based on historical experience and other related factors, including expectations of future events that are believed to be reasonable under the circumstances. The areas involving a higher degree of judgement or complexity, or areas where assumptions are significant to the financial statements are:

Value Added Tax (“VAT”)

Revenues, expenses and assets are recognised net of VAT, except where the VAT incurred on a purchase of an asset or service is not recoverable from the Tax Authorities, in which case the VAT is recognised as part of the cost of acquiring the asset or as part of the cost of the service.

The net amount of VAT recoverable from, or payable to, the Tax Authorities is included as part of receivables or payables in the Statement of Financial Position.

•

•

•

•

• • •

Measurement of the provision for potential claims is based on the gross amount of intimated claims, amounts previously settled in terms of similar claims and the view of legal advisers.(Note 23)The determination of the fair value of unlisted securities using valuation techniques and referenced to recent transactions which are substantially similar. (Note 14)Objective evidence of impairment of available-for-sale financial assets by reference to the fair value of the investment in relation to its cost. The Group recognises impairment charges on available-for-sale-financial assets when there has been a significant or prolonged decline in fair value below their cost. The determination of what is significant or prolonged requires judgement. In making these judgements, the Group evaluates, among other factors, historical share price movements and the duration and extent to which the fair value is less than cost. (Note 14)Objective evidence of impairment of loans receivable by reference to the market value of collateral held as security in the related client account. (Note 15)The estimated useful lives of equipment and their residual values are re-assessed annually. (Note 9)Recoverability of deferred taxation based on expected future profitability. (Note 6)Share based payments (Note 26)



65PAGE |


2.

3.

REVENUE

Asset management – investment, advisory and performance feesBrokerage CommissionsCorporate finance mandate and retainer feesDividends received:From listed investments Non -groupFrom un-listed investments GroupFee income Futures trading Interest income: Group Non- groupManagement fee income: Group Non- groupSecurities trading (fair value losses or gains)Trust business

OTHER OPERATING INCOME:

Exchange gainsDebt forgiveness – group loansFair value gain – available-for-sale financial assetsFee recoveriesOperating lease incomeProfit on disposal of equipmentProfit / (loss) on disposal of investmentsSub delegation management feesCost awards- arbitration processSundry income

----

-

13 557 098--

4 216 537181 644

3 444 382---

21 399 661

2 557 668-

--

266 9961 000

---

73 019

2 898 683

49 498 85037 222 53810 752 5487 529 763

889 509

-11 191 943

16 107 551

-3 541 228

--

416 1298 769 386

145 919 445

1 200 901-

3 200 5824 911 872

153 23370 978

640 7701 258 824

326 2556 427 781

18 191 196

15

15

15

38 706 06228 718 3665 893 734

10 820 219

1 068 728

-9 909 99920 882 758

-3 953 755

-61 675

2 467 409-

122 482 705

3 081 608-

-5 132 019

99 289-

1 823 5061 597 9991 170 709

2 054 403

14 959 533

----

-

2 002 492267 634

-

4 269 51633 770

3 736 668---

10 310 080

1 187 12231 935 226

--

226 52646 232

(4 285)---

33 390 871

Notes

Group2013Pula

Group2012Pula

Company2013Pula

Company 2012Pula

Year ended 30 April



66PAGE |


4.

5.

1.

2.

OPERATING EXPENSES

Finance Costs:

Included in operating expenses are:

Auditor’s remuneration Current year Prior year Expenses Amortisation (Note 11)Depreciation (Note 9)

Directors’ remuneration Directors’ remuneration - executive – (see note below) Directors’ remuneration - non-executive

Information technology expensesInsurance and licencesMarketing expensesOffice rent and utility costsOperating lease expense Professional feesLoss on disposal of equipmentShare based payment expense (Note 26)Staff costsStock exchange feesTravel

2 941 090

2 840 578100 512

-

88 7862 073 300

34 029 373

31 638 707

2 390 666

3 390 0431 895 5551 535 0857 102 385

172 0135 409 707

75 387854 156

44 348 9824 514 7943 331 407

111 762 063

2 012 348

1 984 45427 894

-

193 2031 567 503

31 157 298

29 253 285

1 904 013

2 335 3501 201 232

4 223 046223 9004 261 544

35 795656 531

29 350 6944 399 153

3 266 790

84 660 487

632 223

632 223--

-191 513

7 489 131

6 042 144

1 446 987

228 472793 346

1 535 085182 981213 918

826 601-

184 9281 728 262

83 500957 750

15 047 710

419 397

419 397--

142 800204 820

6 222 628

4 962 723

1 259 905

323 519554 408

-147 243263 128

502 004-

131 6101 369 122

70 781799 942

11 151 402

Group2013Pula

Group2013Pula

Group2012Pula

Group2012Pula

Company 2013Pula

Company2013Pula

Company 2012Pula

Company 2012Pula

Year ended 30 April

Year ended 30 April

Directors’ remuneration:

The directors’ remuneration disclosed in the note above excludes performance bonuses in respect of the 2012 financial year which were paid in 2013. Such amounts have been charged against prior year provisions for performance bonuses and consequently are excluded from the Income Statement charge for the current year.Directors’ remuneration includes remuneration paid to directors of subsidiary companies as well as the parent company. Directors’ remuneration in respect of Imara Beresford International Limited, the Mauritius registered entity, is included from 1 November 2012, the date on which this company became a subsidiary.

Interest expense – group (Note 15)Interest expense - banksRelated parties (Note 15)

-395 747

1 021

396 768

-510 042

-

510 042

4 323 285--

4 323 285

2 909 043--

2 909 043



67PAGE |


6. INCOME TAX - GROUP

Current income tax chargeAdjustment in respect of over provision of income tax in previous yearAdditional company tax (ACT) utilisedWithholding tax

Deferred income tax:Relating to origination and reversal of temporary differencesChanges in tax ratesUtilisation of prior year deferred tax assets not recognisedAdjustments in respect of deferred tax in previous years

Income tax reported in the Income Statement

Tax rate reconciliation (Pula):A reconciliation between the tax expense and the product of accounting profit multiplied by Botswana’s International Financial Services Centre (“IFSC”) tax rate for the year is as follows:Accounting profit before tax at Botswana IFSC income tax rate of 15%

Adjusted for:Effect of higher domestic rate in BotswanaEffect of higher rate in South AfricaEffect of higher rate in United KingdomEffect of higher rate in ZimbabweEffect of lower rate in British Virgin IslandsEffect of rate change on opening tax balancesNon - deductible expenses / non - taxable incomeCorporate social responsibilityWithholding taxCapital gains taxAdjustment in respect of (over) / under provision of income tax in previous yearAdjustment in respect of deferred tax in the previous yearUtilisation of prior year deferred tax assets not recognised

Deferred tax asset credit not recognised due to uncertainty of future taxable income *

At effective tax rate (See reconciliation below)

4 192 72032 832

(49 989)286 722

4 462 285

698 766--

(183 656)

515 110

4 977 395

521 588

(748 915)335 892

5 365692 118

2 216 537-

1 180 051(49 989)286 722(60 145)

32 832(183 656)

(1 705 789)

2 522 6122 454 783

4 977 395

2 368 674(2 561)

-247 342

2 613 455

164 52113 806

-950 000

1 128 327

3 741 782

1 275 513

(376 777)845 901

4 512134 336

(1 913 126)13 806

895 923-

247 342684 964

(2 274)950 000(25 730)

2 734 3901 007 391

3 741 781

Group2013Pula

Group2012Pula

Year ended 30 April

Current income tax:

The unrecognised deferred tax assets relate to tax losses arising from the corporate finance subsidiary in South Africa and a broking subsidiary in Botswana.

*



68PAGE |

15(22)

10-

2064

-34(1)8

(2)

1(5)

(49)

73

71

143

Pula

(103 871)-

(3 352 143)(389 600)

(3 845 613)

1 279 17865

1 178 431

2 457 674

(1 387 939)

1 033 646(2 421 586)

(1 387 940)


6. INCOME TAX - GROUP (continued)

Reconciliation of income tax rate:Standard Botswana International Financial Services Centre (IFSC) tax rateAdjusted for: Effect of higher domestic rate in Botswana Effect of higher rate in South Africa Effect of higher rate in United Kingdom Effect of higher rate in Zimbabwe Effect of lower rate in British Virgin Islands Effect of rate change on opening tax balances Non - deductible expenses / non - taxable income Corporate social responsibility Withholding tax Capital gains tax, taxed at lower rate Adjustment in respect of (over) / under provision of income tax in previous year Adjustment in respect of deferred tax in the previous year Utilisation of prior year deferred tax assets not recognised

Deferred tax asset not recognised due to uncertainty of future taxable income

Effective tax rate

Deferred income tax asset:Deferred income tax liabilities:Accelerated depreciation for tax purposesUnrealised trading profitsCapital gains taxCredit losses

Deferred income tax assets:Assessable lossUnrealised trading profitsProvisions

Net deferred tax (liability) / asset

Analysed as follows per Statement of Financial Position:Deferred tax assetsDeferred tax liabilities

Net deferred tax asset - per above

15(4)10-2

(22)-11-38

-11-

32

12

44

Pula

(73 249)(16 462)

(3 782 242)(374 669)

(4 246 622)

2 506 65524 523

487 914

3 019 092

(1 227 530)

2 341 462(3 568 992)

(1 227 530)

Group2013

%

Group2012

%

Year ended 30 April

Year ended 30 April

Current income tax:



69PAGE |


6. INCOME TAX - GROUP (continued)

INCOME TAX - COMPANY

Balance brought forward(Increase)/decrease in current year

Balance carried forward Expiring as follows: 30 June 2013 30 June 2014 30 June 2015 30 June 2016 30 June 2017 30 June 2018 Indefinitely

Assessed losses for which no deferred tax is recognised

Current income tax:Current income tax chargeWithholding tax

Deferred income tax:Relating to origination and reversal of temporary differencesAdjustments in respect of deferred tax in previous years

Income tax reported in the Income Statement

Reconciliation of tax rate:A reconciliation between the tax expense and the product of accounting profit multiplied by Botswana’s IFSC tax rate for the year is as follows:Accounting profit before tax at Botswana IFSC income tax rate of 15%Adjusted for: Non - deductible expenses / non - deductible income Withholding tax Adjustment in respect of deferred tax in the previous year Adjustment in respect of (over) / under provision of income tax in previous year Utilisation of prior year deferred tax asset not recognised

Deferred tax asset not recognised due to uncertainty of future taxable income

At effective tax rate (See reconciliation below)

-21 420

21 420

1 349 153-

1 349 153

1 370 573

3 009 55445 38821 420

--

(1 705 789)

1 370 573

-

1 370 573

-19 832

19 832

950 000(2 561)

947 439

967 271

908 232(1 732 439)

19 832950 000

(2 561)-

143 064

824 207

967 271

69 103 948(14 103 280)

55 000 668

-1 837 4883 522 0626 461 284

6 977 6605 869 844

30 332 329

55 000 668

(48 926 301)

65 996 4493 107 499

69 103 948

2 705 2113 956 59312 151 629

16 079 6596 977 660

-27 233 196

69 103 948

(53 514 213)

Group2013Pula

Group2012Pula

Year ended 30 April

Assessed losses:

Company2013Pula

Company2012Pula

Year ended 30 April



70PAGE |


6. INCOME TAX - COMPANY (continued)

Reconciliation of income tax rate:Standard Botswana International Financial Services Centre (IFSC) tax rate Adjusted for: Non- deductible expenses / non-taxable income Withholding tax Adjustment in respect of deferred tax in the previous year Adjustment in respect of (over) / under provision of income tax in previous year

Deferred tax asset credit not recognised due to uncertainty of future taxable income

Effective tax rate

Deferred income tax asset:Deferred income tax liability:Accelerated depreciation for tax purposesDeferred lease asset

Deferred income tax asset:Assessed lossesProvisions

Net deferred income tax asset

Analysed as follows per Balance Sheet:Deferred tax assetDeferred tax liabilities

Net deferred tax asset per above

Assessed losses:Balance brought forwardIncrease / (decrease) in current year

Balance carried forward

Expiring as follows: 30 June 2014 30 June 2015 30 June 2016 30 June 2017

151-

16

-

3214

45

(33 221)(3 273)

(36 494)

911 147-

911 147

874 652

874 652-

874 652

26 441 268(20 266 957)

6 074 311

--

596 7625 477 549

6 074 311

15(29)

-16

-

214

16

(36 419)-

(36 419)

2 258 4681 756

2 260 224

2 223 805

2 223 805-

2 223 805

20 963 7195 477 549

26 441 268

2 119 1058 525 85710 318 7575 477 549

26 441 268

Company 2013

%

Company 2013Pula

Company 2012

%

Company 2012Pula

Year ended 30 April

Year ended 30 April



71PAGE |


7.

8.

EARNINGS PER SHARE

Dilution of earnings:

(Loss) / profit attributable to equity holders of the parent

Weighted average number of ordinary shares -basic earnings per shareEffect of dilution:Share option scheme

Weighted average number of ordinary shares for effect of dilution

Earnings per share – basic thebeEarnings per share – diluted thebe

(4 304 682)

58 655 186

3 593 167

62 248 353

(7,34)(7,34)

5 635 305

58 650 395

2 569 999

61 220 394

9,609.20

Basic earnings per share are calculated by dividing net profit for the year attributable to ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding for the year.

Diluted earnings per share are calculated by dividing net profit attributable to ordinary equity holders of the parent, by the weighted average number of ordinary shares outstanding for the year, plus the weighted average number of ordinary shares that would be issued on the conversion of all dilutive potential shares into ordinary shares.

The following table reflects the profit and share data used in the basic and diluted earnings per share computations :

SEGMENTAL REPORTING

For management purposes, the Group is organised into business units based on their products and services. The Group has four reportable operating segments as follows:- Asset management- Corporate finance - Stockbroking- Trust administration

Management monitors and manages the operating results of the business units separately for the purposes of decision making, resource allocation and performance assessment. Segment performance is evaluated based on operating profit and loss and is measured consistently with operating profit and loss in the consolidated financial statements. However, Group financing, treasury functions and income taxes are managed on a Group basis.

Transfer pricing between operating segments are on an arm’s length basis in a manner similar to transactions with independent third parties.

The Group’s geographical segmental reporting is based on the location of the Group’s assets and its spread of customers on a geographical basis.

Capital expenditure consists of additions to plant and equipment.

Group2013Pula

Group2013

Number

Group2012Pula

Group2012

Number

Year ended 30 April

Year ended 30 April



72PAGE |


8. SEGMENTAL REPORTING (continued)

OPERATING SEGMENTS

GEOGRAPHIC SEGMENTS

Revenue:External customersInter segment revenue

Total segmental revenue

Other material items:Interest revenue- non groupInterest expenseDepreciation expenseAmortisation expenseCapital expenditure

Profit and loss:Segment profit before taxationShare of income from associatesImpairment losses

Consolidated profit / (loss) before taxationTaxation expense / (credit)

Profit /(loss) after taxation

Assets:Segment assetsGoodwill & other tangiblesInvestments in associates

Total assets

Liabilities:

Total liabilities

Net segmental assets

RevenueTotal assetsNon-current assets *

50 409 3732 701 517

53 110 890

557 802-

454 02148 869

436 887

18 678 479--

18 678 479

(1 569 087)

17 109 392

36 744 182124 924

-

36 869 106

12 094 176

12 094 176

24 774 930

7 784 26444 918 4341 836 458

28 119 65721 865 780

42 746

68 458 904140 869 032

1 743 811

8 874 83823 695 847

13 726 421

32 681 78219 106 9982 663 870

145 919 445252 471 34620 024 372

7 560 440981 452

8 541 892

36 652-

196 336-

73 405

(5 918 176)--

(5 918 176)

51 070

(5 867 106)

7 582 705--

7 582 705

1 965 960

1 965 960

5 616 745

78 993 570-

78 993 570

2 579 829395 103

1 029 126-

728 752

9 954 727428 398

(1 217 474)

9 165 651

(1 606 228)

7 559 423

159 917 942422 816

877 669

161 218 427

87 747 343

87 747 343

73 471 084

8 769 386-

8 769 386

--

99 15939 917

127 882

3 420 367--

3 420 367

(330 458)

3 089 909

10 422 67212 266 118

-

22 688 790

6 299 304

6 299 304

16 389 486

186 67610 016 946

10 203 622

366 9451 665

294 658-

912 318

(22 458 099)666 211

(77 179)

(21 869 062)

(1 522 692)

(23 391 759)

24 112 318--

24 112 318

6 604 970

6 604 970

17 507 348

-(13 699 915)

(13 699 915)

-----

---

-

-

-

---

-

-

-

-

145 919 445-

145 919 445

3 541 228396 768

2 073 30088 786

2 279 244

3 677 2981 094 609

(1 294 653)

3 477 255

(4 977 395)

(1 500 141)

238 779 81912 813 858

877 669

252 471 346

114 711 753

114 711 753

137 759 593

The following tables presents revenue, profit or loss, total assets and total liabilities information in respect of the Group’s business units and geographical segments for the years ended 30 April 2013 and 2012.

Adjustments and eliminations:Adjustments and eliminations relate to intra-group transactions which are eliminated on consolidation.Finance costs and fair value gains and losses on financial assets and liabilities are allocated directly to individual business units. Where the underlying financial instruments are managed at group level these are included as part of “Head Office”.Current taxes and deferred taxes are also allocated directly to individual business units.

Asset Management

Pula

BotswanaPula

StockbrokingPula

South AfricaPula

Adjustments & eliminations

Pula

OtherPula

CorporateFinance

Pula


Pula

TrustAdministration

PulaOther

Pula

ZimbabwePula

Groupconsolidated

Pula

Groupconsolidated

Pula

30 April 2013

30 April 2013

* Non-current assets exclude deferred tax and financial instruments.



73PAGE |


8. SEGMENTAL REPORTING (continued)

GEOGRAPHIC SEGMENTS

OPERATING SEGMENTS

Revenue:External customersInter segment revenue

Total segmental revenue

Other material items:Interest revenueInterest expenseDepreciation expenseAmortisation expenseCapital expenditure

Profit and loss:Segment profit / (loss) before taxationShare of income from associatesImpairment reversal / (losses)

Consolidated profit / (loss) before taxationTaxation

Profit/(loss) after taxation

Assets:Segment assetsGoodwill & other tangiblesInvestments in associates

Total assets

Liabilities:

Total liabilities

Net segmental assets

RevenueTotal assets*Non-current assets **

39 280 7492 444 832

41 725 581

225 98031 640175 15043 174

220 485

13 503 437--

13 503 437(966 543)

12 536 894-

29 959 225130 644

-

30 089 869

10 764 278

19 325 591

13 197 79854 489 825

5 041 653

27 314 40821 785 8714 857 997

73 293 942107 097 819

1 651 340

8 499 69914 068 4042 869 049

176 8582 399 836

1 428 414

122 482 705199 841 75515 848 453

9 839 942367 866

10 207 808

34 816313

152 8467 229

99 926

1 042 130--

1 042 130(351 996)

690 134

12 981 078422 816

-

13 403 894

630 029

12 773 865

72 849 839-

72 849 839

3 247 328475 514

879 345-

782 537

10 107 59193 63732 031

10 233 259(1 421 788)

8 811 471

111 152 082-

329 204

111 481 286

37 534 997

73 946 289

512 17516 356 202

16 868 377

445 6312 575

360 162142 800104 820

(18 031 298)1 755 891

-

(16 275 407)(1 001 454)

(17 276 861)

35 717 838-

9 228 508

44 946 346

7 471 118

37 475 228

-(19 168 900)

(19 168 900)

-----

---

--

-

---

-

-

-

122 482 705-

122 482 705

3 935 755510 042

1 567 503193 203

1 207 768

6 621 8601 849 528

32 031

8 503 419(3 741 781)

4 761 638

189 810 223553 460

9 557 712

199 921 395

56 400 422

143 520 973

* Bank overdraft has been offset against cash & cash equivalents in determining total assets for geographic segmental reporting.** Non-current assets exclude deferred tax asset and available-for-sale-financial assets

Asset Management

Pula

BotswanaPula

StockbrokingPula

South AfricaPula

Adjustments & eliminations

Pula

Adjustments Pula

CorporateFinance

Pula


Pula

OtherPula

OtherPula

Groupconsolidated

Pula

Groupconsolidated

Pula

30 April 2012

30 April 2012



74PAGE |


9. EQUIPMENT - GROUP

Cost: Balance – 1 May 2011 Additions Additions – Acquisition of equipment in subsidiary (at cost) Disposals Exchange rate adjustments

Balance – 30 April 2012

Additions Additions – Acquisition of equipment in subsidiary (at cost) Prior year adjustment Disposals Exchange rate adjustments


Depreciation: Balance – 1 May 2011 Charge for the year Additions – Acquisition of equipment in subsidiary (accumulated depreciation) Disposals Exchange rate adjustments


Charge for the year Additions – Acquisition of equipment in subsidiary (accumulated depreciation) Prior year adjustment Disposals Exchange rate adjustments


Carrying value: 30 April 2012 30 April 2013

1 051 022270 057

3 658 429(813 070)(130 536)

4 035 902

146 000--

(273 101)318 611

4 227 412

(490 847)(305 824)

(1 023 754)393 54930 704

(1 396 172)

(783 978)

--

154 414(85 088)

(2 110 824)

2 639 730

2 116 588

9 305 921937 711

1 817 902(876 514)(155 219)

11 029 801

2 133 2441 025 606

(72 418)(502 665)

(131 265)

13 482 303

(6 948 352)(1 161 838)

(1 028 423)774 30499 302

(8 265 007)

(1 260 406)

(716 686)72 418

263 853152 219

(9 753 609)

2 764 794

3 728 685

1 846 650289 173

-(1 846 650)

-

289 173-

----

289 173

(1 500 831)(99 837)

-1 571 425

22 014

(7 229)

(28 917)

----

(36 146)

281 944

253 027

12 203 5931 496 9415 476 331

(3 536 234)(285 755)

15 354 8762 279 244

1 025 606(72 418)

(775 766)187 346

17 998 888

(8 940 030)(1 567 499)

(2 052 177)2 739 278

152 020

(9 668 408)

(2 073 301)

(716 686) 72 418 418 267

67 131

(11 900 579)

5 686 468

6 098 309

Motor vehicles

Pula

Electroniclibrary

Pula

Office equipment

PulaTotalPula

Year ended 30 April



75PAGE |


9. EQUIPMENT - COMPANY

Cost: Balance – 1 May 2011 Additions Disposals


Additions Disposals


Depreciation: Balance – 1 May 2011 Depreciation charge for the year Disposals


Depreciation charge for the year Disposals Balance – 30 April 2013

Carrying value:

30 April 2012

30 April 2013

653 500--

653 500

146 000(88 500)

711 000

(256 501)(101 539)

-

(358 040)

(109 204)42 900

424 344

295 460

286 656

513 61646 459

(6 806)

553 269

551 484(103 249)

1 001 499

(283 546)(103 281)

6 806

(380 021)

(82 309)40 835

421 494

173 248

580 005

1 167 11646 459

(6 806)

1 206 769

697 484(191 749)

1 712 504

(540 047)(204 820)

6 806

(738 061)

(191 513)83 735

845 839

468 708

866 665

Office equipmentPula

Motor vehiclesPula

TotalPula

Year ended 30 April

10. GOODWILL

Balance at the beginning of the yearArising on the acquisition of subsidiary (Note 12)Exchange rate adjustment

Comprising:Imara SP Reid (Proprietary) LimitedImara Capital Securities (Proprietary) LimitedImara Asset Management (Mauritius) LimitedImara Beresford International Limited

529 14225 930(1 612)

553 460

104 714422 81625 930

-

553 460

553 46012 266 118

(5 720)

12 813 858

98 994422 81625 930

12 266 118

12 813 858

---

-

----

-

---

-

----

-

Year ended 30 April

Group2013Pula

Group2012Pula

Company2013Pula

Company2012Pula



76PAGE |


GOODWILL (continued)

Imara SP Reid Proprietary Limited, (“ISPR”), is a South African stockbroking subsidiary;

Imara Capital Securities Proprietary Limited, (“Imara Capital Securities”) is a Botswana stockbroking subsidiary. The company was previously known as Capital Securities Proprietary Limited. It changed its name on 30 April 2012;

Imara Asset Management (Mauritius) Limited is a Mauritian asset management company. The company was previously known as Kappa Forte Asset Management Limited. It changed its name on 21 October 2011;

Imara Beresford International Limited is a Mauritian investment holding company. The company became a subsidiary company on 31 October 2012 and has been consolidated from that date.

Goodwill is tested for impairment annually or more frequently if circumstances indicate that goodwill is impaired. Goodwill is subsequently stated at cost less accumulated impairments in value as follows:

Imara SP Reid (South Africa)

The recoverable amount of ISPR has been determined using the value in use calculation based on the cash flow projections in financial budgets approved by senior management. A pre-tax group specific risk adjusted discount rate of 8.89% (2012: 10.25%) was used. The projected cash flows beyond the 5 years were extrapolated using a steady average growth rate of 3.2% (2012: 4.10%), not exceeding the long term average growth rate for the market in which the business operates. The cash flows were determined based on past performance, management expectations and recent market developments.

Imara Capital Securities (Botswana)

The recoverable amount of Imara Capital Securities has been determined using the value in use calculation based on the cash flow projections in financial budgets approved by senior management. A pre-tax group specific risk adjusted discount rate of 6.34% (2012: 7.19%) was used. The projected cash flows beyond the 5 years were extrapolated using a steady average growth rate of 3.0% (2012: 2.50%) not exceeding the long term average growth rate for the market in which the business operates. The cash flows were determined based on past performance, management expectations and recent market developments.

Imara Asset Management and Imara Beresford International (Mauritius)

The recoverable amount of Imara Asset Management (Mauritius) Limited has been determined using the value in use calculation based on the cash flow projections in financial budgets approved by senior management. A pre-tax risk adjusted discount rate of 6.08% was used (2012: 6.31%). The discount rate is specific to the cash generating unit. The projected cash flows beyond the 5 years were extrapolated using a steady average growth rate of 3.00% (2012: 3.0%), which does not exceed the long term average growth rate for the market in which the business operates. The cash flows were determined based on past performance, management expectations and recent market developments.

In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs to sell, recent market transactions are taken into account. If no such transactions can be identified, then an appropriate valuation model is used.

10.



77PAGE |


11. INTANGIBLE ASSETS (continued)

Cost:At beginning of yearExchange rate adjustment

At end of year

Amortisation:At beginning of yearAmortisation charge for the yearExchange rate adjustment

At end of year

Carrying amount

714 000-

714 000

(571 200)(142 800)

-

(714 000)

-

257 977(3 912)

254 065

(154 785)(50 403)

1 936

(203 252)

50 813

971 977(3 912)

968 065

(725 985)(193 203)

1 936

(917 252)

50 813

Year ended 30 April 2012

Management sharesPula

Client data basePula

TotalPulaGROUP:

Cost:At beginning of year & end of year

Amortisation:At beginning of yearAmortisation charge for the year

At end of year

Carrying amount

714 000

(714 000)-

(714 000)

-

714 000

(714 000)-

(714 000)

-



TotalPulaCOMPANY:

The Administration Software System relates to Imara Beresford International Limited (Mauritius) and is a client and employee management system. The system is being amortised over a 3 year period. Imara Beresford International Limited became a subsidiary company on 31 October 2012. The total amortisation charge for the year is P56 622 of which P16 705 relates to the period prior to acquisition and P39 917 to the period prior to acquisition.

Client data base – The client data base was recognised as an intangible asset following Imara Asset Management South Africa Proprietary Limited’s acquisition of an asset management client data base from Leitch & Associates in July 2007. The client data base is being amortised over a period of five years.

Management shares are founder shares and are held primarily to secure the on-going management rights for the Imara Global Fund. The shares do carry voting rights but have no entitlement to economic rights or to the underlying value of the Fund itself. The management agreement for the Imara Global Fund is for an indefinite period and the costs associated with the management rights have been amortised over a period of five years.

GROUP:Cost:At beginning of yearAdditionsExchange rate adjustment

At end of year

Amortisation:At beginning of yearAmortisation charge for the yearAmortisation charge pre-acquisitionExchange rate adjustment

At end of year

Carrying amount

714 000--

714 000

(714 000)---

(714 000)

-

-291 155

-

291 155

-(39 917)(16 705)

-

(56 622)

234 533

254 065-

(13 877)

240 188

(203 252)(48 870)

-11 934

240 188

-

968 065291 155

(13 877)

1 245 343

(917 252)(88 787)(16 705)

11 934

1 010 810

234 533



Administration Software System

PulaClient data base

Pula TotalPula



78PAGE |

INTANGIBLE ASSETS (continued)


11.

12.

For ordinary shares at cost, the percentage holding equates in all instances to the voting rights attached to shares.

No voting rights attach to the preference shares.

Share based payment reserve relates to the equity component of shares options granted to employees of the company and its subsidiaries under the Group’s Share Option Scheme. The cost stated above is the cumulative amount which has been re-allocated to underlying subsidiary companies. These amounts have no impact from a group perspective as they eliminate on consolidation.

INVESTMENT IN SUBSIDIARIES

Ordinary shares at cost:Africa Private Equity Fund Managers (Pty) Ltd Africa Investments Limited CF Africa Limited Imara Asset Management Limited Imara Asset Management Mauritius Limited Imara Asset Management UK Ltd Imara Beresford International Limited Imara Capital Botswana (Proprietary) LimitedImara Capital Limited Imara Capital Kenya Limited Imara Capital South Africa (Pty) Ltd.Imara Capital Zambia Limited Imara Trademarks Limited

Preference shares at cost:Imara Asset Management UK Limited

Share based payment reserve:Group companies (See note below and note 27).

Total investment in subsidiaries

50%100%100%100%

51%100%

51%100%100%100%

93,75%100%100%

100%

123

45

67

BotswanaBritish Virgin IslandsBritish Virgin IslandsBritish Virgin IslandsMauritiusUnited KingdomMauritiusBotswanaBritish Virgin IslandsKenyaSouth AfricaZambiaBritish Virgin Islands

1007 877 8455 802 981

22 754622 088

83 47312 186 7858 500 100

15 319 8418 446

19 666 2127 042

590 100

70 687 767

205 339

5 224 034

76 117 140

1007 877 8455 802 981

22 754622 088

83 473-

3 500 10013 319 841

8 44619 666 212

7 0426

50 910 888

205 339

4 554 806

55 671 033

%Holding Note

Country of incorporation

Company2013Pula

Company2012Pula

Year ended 30 April

Cost:At beginning of year & end of year

Amortisation:At beginning of yearAmortisation charge for the year

At end of year

Carrying amount

714 000

(571 200)(142 800)

(714 000)

-

714 000

(571 200)(142 800)

(714 000)

-



TotalPulaCOMPANY:

Africa Private Equity Fund Managers (Pty) Limited:

Is a management company established for the purpose of managing a private equity fund initiative between Imara Holdings Limited and ICEA Lion Asset Management, a company registered in Kenya.

Africa Investments Limited:

Up until 19 May 2010, Africa Investments Limited (AIL) owned 100% of Imara Capital South Africa Proprietary Limited (ICAPSA). On 20 May 2010 it donated 2 480 ordinary shares in the issued capital of ICAPSA to Imara South Africa Trust, (ISAT), a broad based black economic empowerment Trust. Following the donation of shares AIL owned 93,75% of ICAPSA. On 20 February 2012, the shares held by AIL were acquired, as part of a Group re-organisation, by Imara Holdings Limited.

1.

2.

Notes relating to specific subsidiary companies:



79PAGE |


INVESTMENT IN SUBSIDIARIES (continued)12.

CF Africa Limited:

Imara Holdings Limited (“IHL”) acquired the remaining 30,73% non-controlling interest in CF Africa Limited on 1 December 2010. CF Africa Limited has as its sole asset, a 46,35% shareholding in Imara Capital Zimbabwe (Private) Limited (ICZ). IHL’s investment in ICZ is held through CF Africa Limited. As the result of a Share Voting Agreement between IHL and certain ICZ shareholders, IHL has consolidated ICZ with effect from 1 December 2011.

Imara Beresford International Limited:

Imara Beresford International Limited (IBIL) became a subsidiary company on 31 October 2012 following the acquisition of a further 10.99% equity tranche. Previously the company was an associate of Imara Holdings Limited.It is the parent company of Imara Trust Company (Mauritius) Limited and Beresford Trust and Corporate Services Limited, both of which are registered in Mauritius and also of Imara Fiduciaries Services SARL which is registered in Switzerland.

Imara Capital Botswana (Proprietary) Limited:

Is the holding company for the group’s Botswana registered entities, excluding Imara Holdings Limited. Its subsidiary companies and the percentage shareholding in each are as follows:

Imara Africa Securities (Proprietary) Limited 100%Imara Asset Management (Proprietary) Limited 100%Imara Botswana Limited 100%Imara Capital Limited 100%Imara Capital Securities (Proprietary) Limited 100%

Imara Capital South Africa Proprietary Limited:

Is the holding company for the group’s South African registered entities. Its subsidiary entities and the percentage shareholding in each are as follows:

Imara Asset Management South Africa Proprietary Limited 100%Imara Corporate Finance South Africa Proprietary Limited 100%Imara SP Reid Proprietary Limited 100%Imara South Africa Trust 100%

Imara Capital Zambia Limited:Is an investment holding company and owns 25% of Stockbrokers Zambia Limited. Stockbrokers Zambia Limited is an associate of Imara Holdings Limited

3.

4.

5.

6.

7.

Notes relating to specific subsidiary companies (continued):

On 30 September 2009, Imara Holdings Limited acquired a 25%, plus one share, equity stake in Imara Beresford International Limited (IBIL), a Mauritian registered company. In terms of a Shareholders Agreement IHL has been increasing its equity stake by a further 5% annually and at the previous year end date owned 35.01%. During the year IHL’s shareholding in IBIL was increased to 51% through the acquisition of additional shares in two separate tranches. On 1 August 2012, IHL acquired 5% of the issued capital of the company for a cash consideration of P1 355 860 and on 31 October 2012 a further 10.99% of the issued capital for a cash consideration of P2 906 714. The company became a subsidiary company with effect from 31 October 2012.

IBIL is an investment holding company, registered in Mauritius and was incorporated on 24 September 2009. It is the parent company of Imara Trust Company (Mauritius) Limited and Beresford Trust and Corporate Services Limited, both of which are registered in Mauritius and also of Imara Fiduciaries Services SARL which is registered in Switzerland. The subsidiary companies are engaged in either global trust administration or investment, custodial, pension and management services.

Imara Beresford International Limited:At the beginning of the yearTransfer of investment in associate companyAcquisition of controlling interest

At the end of the year

-9 280 0712 906 714

12 186 785

---

-

Company2013Pula

Company2012PulaAcquisition of subsidiary :




80PAGE |


INVESTMENT IN SUBSIDIARIES (continued)12.Acquisition of subsidiary (continued):Imara Beresford International Limited (continued):

Equipment Intangible assets Trade and other receivables Cash and cash equivalents Taxation payable Trade and other payables Retirement benefit obligations Deferred tax

Net assets Less: Non-controlling interest

Net assets acquired Goodwill arising on acquisition Purchase consideration transferred Cash consideration Fair value of investment in associate prior to acquisition of controlling stake Gain from investment in associate on acquisition of controlling interest:Share of net income since acquisitionCash cost of investment in associate

Fair value of investment in associate prior to acquisition of controlling stake

Gain from investment in associate on acquisition of controlling interest:Net cash flow from acquisition of controlling interest:Cash consideration paid for controlling interest

Cash held by subsidiary on date of acquisition

314 726271 956

3 799 2472 642 314(275 422)

(3 829 645)(421 174)(24 287)

2 477 715(1 236 380)

1 241 335

12 266 11813 507 453 2 906 714

10 600 739

(281 663)(9 280 071)

(9 561 734)10 600 739

1 039 003

2 906 714(2 642 314)

264 400

Note 13

Pula

The net assets of the subsidiary at the date of acquisition comprised:



81PAGE |


INVESTMENT IN SUBSIDIARIES (continued)12.Increases in investment in subsidiary:CF Africa Limited:

Balance at beginning of the year:Acquisition of non-controlling interests for cash Acquisition of non-controlling interests for equity Balance at end of the yearBalance at beginning and end of year

At the beginning of the yearMovement for the year




----

5 802 981

622 088-

622 088

3 500 1005 000 000

8 500 100

1 747 5252 160 9261 894 5305 802 981

-

-622 088

622 088

2 000 1001 500 000

3 500 100

Company2013Pula

Company2013Pula

Company2013Pula

Company2012Pula

Company2012Pula

Company2012Pula




CF Africa Limited is a British Virgin Islands registered company, which has as its sole asset, a 46,35% shareholding in Imara Capital Zimbabwe (Private) Limited. Imara Holdings Limited (“IHL”) acquired the remaining 30,73% non-controlling interest in CF Africa Limited on 1 December 2011. IHL’s investment in Imara Capital Zimbabwe (Private) Limited is held through CF Africa Limited.

Imara Capital Zimbabwe (Private) Limited

Imara Capital Zimbabwe (Private) Limited (“ICZ”) became a subsidiary company of Imara Holdings Limited (IHL) on 1 December 2011. Prior to this date ICZ was an associate company. IHL investment in ICZ is through CF Africa Limited. ICZ is a company incorporated in Zimbabwe and engaged in the businesses of Asset Management, Corporate Finance and Stockbroking.

The assessment of impairment in value of the investment in subsidiary has been based on the audited financial statements of the company for the 12 months to 31 March 2013 and on reviewed management accounts for the one month ended 30 April 2013. These are the latest available financial statements for the company.

On 1 May 2011, the British Virgin Islands company, Imara Asset Management Limited acquired 50%, plus one share, of the issued capital of Kappa Forte Asset Management Limited, a Mauritius registered entity engaged in the business of asset management. The name of the company was subsequently changed to Imara Asset Management (Mauritius) Limited.

On 30 April 2013, Imara Holdings Limited subscribed for 100 new ordinary shares in the capital of Imara Capital Botswana (Pty) Limited, for a consideration of P5 000 000. The total subscription price for the new shares was settled through the conversion of a loan account due by Imara Capital Botswana (Pty) Limited to Imara Holdings Limited.

Imara Asset Management Mauritius Limited:

Imara Capital Botswana (Proprietary) Limited:



82PAGE |


INVESTMENT IN SUBSIDIARIES (continued)12.Increases in investment in subsidiary:(continued)Imara Capital Botswana (Proprietary) Limited (continued):

On 30 April 2012, Imara Holdings Limited also subscribed for 100 new ordinary shares in the capital of Imara Capital Botswana (Pty) Limited, for a consideration of P1 500 000. The total subscription price for the new shares was settled through the conversion of a loan account due by Imara Capital Botswana (Pty) Limited to Imara Holdings Limited.

On 30 April 2013, Imara Holdings Limited subscribed for 100 new ordinary shares in the capital of Imara Capital Limited, the British Virgin Islands registered entity, for a consideration of P2 000 000. The total subscription price for the new shares was settled through the conversion of a loan account due by Imara Capital Limited to Imara Holdings Limited.

On 30 April 2012, Imara Holdings Limited also subscribed for 100 new ordinary shares in the capital of Imara Capital Limited, the British Virgin Islands registered entity, for a consideration of P1 000 000. The total subscription price for the new shares was settled through the conversion of a loan account due by Imara Capital Limited to Imara Holdings Limited.



13 319 8412 000 000

15 319 841

12 319 8411 000 000

13 319 841

Company2013Pula

Company2012Pula

Year ended 30 April 2013Imara Capital Limited – British Virgin Islands:



19 666 212-

19 666 212

-19 666 212

19 666 212

Company2013Pula

Company2012Pula

Year ended 30 April 2013Imara Capital South Africa (Proprietary) Limited:



6590 094

590 100

6-

6

Company2013Pula

Company2012Pula


Imara Holdings Limited acquired all of the shares held by Africa Investments Limited, in Imara Capital South Africa (Pty) Limited on 20 February 2012 for a consideration of P19 666 211. As a result, Imara Holdings Limited directly owns 93.75% of Imara Capital South Africa (Pty) Limited. Africa Investments Limited is a British Virgin Islands registered company.

On 30 April 2013, Imara Holdings Limited subscribed for 100 new ordinary shares in the capital of Imara Trademarks Limited, the British Virgin Islands registered entity, for a consideration of P90 194. The total subscription price for the new shares was settled through the conversion of a loan account due by Imara Trademarks Limited to Imara Holdings Limited.

Also on 30 April 2013 Imara Holdings Limited subscribed for 100 new ordinary shares in the capital of Imara Trademarks Limited for a consideration of P500 000. The total subscription price for the new shares was settled in cash.

Imara Trademarks Limited:



83PAGE |


INVESTMENT IN ASSOCIATES13.

Balance at the beginning of the yearShare of profits / (losses) for the yearAcquisitions during the year for cashDividends receivedImpairment losses on investment - per Income StatementTransfers from available-for-sale financial assets

Transfers out (See note 10)

Balance at the end of the year

Balance at the beginning of the yearAcquisitions during the year:Cash considerationTransfer of investment to parent company


Balance at the beginning of the yearShare of profits Acquisitions during the year:

Cash consideration

Dividends receivedImpairment gain / (loss) on investment - per Income StatementTransfers out


7 811 988666 211

1 355 860(272 323)

-

-

(9 561 734)

-

7 924 212

4 262 574(12 186 786)

-

7 395 0481 031 637

589 763

(1 204 460)

--

7 811 988

1 416 520(122 974)

-(78 980)

(904 099)

-

-

310 467

1 328 91387 607

-

-

--

1 416 520

329 204551 373

--

(313 375)

-

-

567 202

291 142

--

291 142

291 1426 031

-

-

32 031-

329 204

----

(77 179)

77 179

-

-

4 331 991724 253

-

(829 876)

-(4 226 368)

-

9 557 7121 094 6101 355 860(351 303)

(1 294 653)

77 179

(9 561 734)

877 669

8 215 354

4 262 574(12 186 786)

291 142

13 347 0941 849 528

589 763

(2 034 336)

32 031(4 226 368)

9 557 712

ImaraBeresford

InternationalLimited

ImaraBeresford


ImaraBeresford


Pula

Pula

Pula

Pula

Pula

Pula

Pula

Pula

Pula

Pula

Pula

Pula

Pula

StockbrokersZambiaLimited

StockbrokersZambiaLimited

StockbrokersMalawiLimited



Imara CapitalZimbabwe

(Private)Limited

Imara CapitalZimbabwe

(Private)Limited

Total Group

Total Group

Total Group




GROUP:

COMPANY:

GROUP:



84PAGE |

Balance at the beginning of the yearAcquisitions during the year:Cash considerationTransfer of investment to parent company


7 334 449

589 763-

7 924 212

-

-291 142

291 142

7 334 449

589 763291 142

8 215 354

ImaraBeresford


Pula Pula Pula


Total Group



INVESTMENT IN ASSOCIATES (continued)13.


At 30 April 2012, Imara Holdings Limited (IHL) owned 35.01% of Imara Beresford International Limited (IBIL). IBIL is registered in Mauritius. During the year IHL’s shareholding in IBIL was increased to 51% through the acquisition of additional shares in two separate tranches. On 1 August 2012, IHL acquired 5% of the issued capital of the company for a cash consideration of P1 355 860 and on 31 October 2012 a further 10.99% of the issued capital for a cash consideration of P2 906 714. The company became a subsidiary company with effect from 31 October 2012 – see note 12.

Stockbrokers Zambia Limited:

On 31 October 2009, the Group through its wholly owned subsidiary company, Imara Capital Zambia Limited, acquired a 25% interest in Stockbrokers Zambia Limited, a stock-broking company registered and operating in Zambia.

The year-end of Stockbrokers Zambia Limited is 30 April. An independent statutory audit of Stockbrokers Zambia Limited has been carried out for the year ended 30 April 2013 and un-qualified audit opinion issued.

Impairment testing of the investment at 30 April 2013 has been based on audited financial statements for the company to 30 April 2013. The following table give summarised information of the Group’s investment in Stockbrokers Zambia Limited, based on audited financial statements to 30 April 2013 and April 2012.

Stockbrokers Malawi Limited:

The Group owns 25% of Stockbrokers Malawi Limited, a company incorporated in Malawi and engaged in the business of stockbroking. The investment in Stockbrokers Malawi Limited was previously held by Imara Capital Limited, a company registered in the British Virgin Islands. As part of a group re-organisation, the investment was transferred from Imara Capital Limited to Imara Holdings Limited in April 2012.

The financial year end of Stockbrokers Malawi Limited is 31 December and an independent statutory audit for the year ended 31 December 2012 has been completed and un-qualified audit opinion issued.

Share of associate’s statement of financial position:Current assetsNon-current assetsCurrent liabilitiesOther liabilities

Net assets

Share of associate’s revenue and profits /(losses) after tax: 25%Revenue(Loss)/profit after taxation

979 248225 600894 382

-

310 466

1 259 309(122 974)

1 046 311198 246

742 807-

501 750

2 053 02287 607

30 April 2013(Audited)

Pula


Pula

COMPANY:



85PAGE |


INVESTMENT IN ASSOCIATES (continued)13.

14.

Stockbrokers Malawi Limited (continued):

Impairment testing of the investment at 30 April 2013 has been based on the audited financial statements to 31 December 2012 and reviewed management accounts for the four month period from 1 January 2013 to 30 April 2013. These are the latest available management accounts for the company.

The investment in associate is carried at cost plus the post-acquisition changes in the Group’s share of the net assets of the associate.Dividend remittances from Malawi are subject to Exchange Control approval.

The following tables give summarised information of the Group’s investment in Stockbrokers Malawi Limited, based on audited financial statements to 31 December 2012, and reviewed management accounts to 30 April 2013:

Share of associate’s statement of financial position – 25%:Current assetsNon-current assetsCurrent liabilitiesOther liabilitiesNet assets

Share of associate’s revenue and profits /(losses) after tax - 25%:RevenueProfit /(loss) after taxation

1 304 64450 862

788 304-

567 202

915 404551 373

396 68716 290

930 98424 023

(542 030)

610 2386 031


Pula


Pula

AVAILABLE-FOR-SALE FINANCIAL ASSETS

Group2013Pula

Group2012Pula

Company2013Pula

Company2012Pula

Year ended 30 April

Listed securities: JSE Limited sharesDiversified listed equity portfolio- South AfricaDiversified listed equity portfolio- BotswanaDiversified listed equity portfolio- ZimbabweAngola Stock Exchange securities Botswana Stock Exchange proprietary rightsOther listed securities

Total listed securities

Unlisted securities:Imara / Investec Unit Trust Wrap FundOld Mutual Unit TrustsIIF RMB Tracker FundPCC Imara Sector portfolioLiberty Unit TrustsGlobal Alliance Equity PartnersImara Nigeria FundZiada (Private) Limited

Total unlisted securities

Total available-for-sale financial assets

4 077 9075 110 648

86 679-

139 002110 628

18 891

9 543 755

6 10488 781

-12 99092 852101 299

11 334 790-

11 636 816

21 180 571

5 393 2964 402 143

86 679130 749139 002110 62814 809

10 277 306

7 36089 307

12 792-

96 598101 299

7 210 17072 102

7 589 628

17 866 934

----

139 002-

18 893

157 895

---

-101 299

--

101 299

259 194

----

139 002-

14 809

153 811

---

-101 299

--

101 299

255 110



86PAGE |


14.

15.

Listed securities

The fair value of listed securities is determined by reference to the quoted market bid prices at the close of business on the reporting date.

Unlisted securities

The unlisted securities comprise unit trusts, mutual funds and equity investments.

The fair value for unit trust investments is determined by reference to the bid price for this class of product at the close of business daily. The bid price is computed by reference to the underlying value of assets in the unit trust funds and is published daily. The last valuations were carried out on 30 April 2013.

The equity investment in Global Alliance Equity Partners is valued based on directors’ valuations. The last valuation was carried out on 30 April 2013.

AVAILABLE-FOR-SALE FINANCIAL ASSETS (continued)

RELATED PARTY DISCLOSURES

Subsidiary companies:

Subsidiary companies – indirectly held:

Imara Holdings Limited is the Group parent company. It is registered in Botswana, is listed on the Venture Capital Board of the Botswana Stock Exchange and is licenced in the International Financial Services Centre (“IFSC”) – Botswana’s Offshore Centre. Imara Holdings Limited owns 100% of the issued capital of the following Group companies:

100% ownership:

Parent and underlying subsidiaries

Less than 100% ownership:

Africa Investments LimitedCF Africa Limited Imara Asset Management Limited Imara Asset Management (UK) Limited Imara Capital Limited Imara Capital Botswana Proprietary Limited Imara Capital Kenya Limited Imara Capital Zambia Limited Imara Trademarks Limited

CF Africa Limited: Imara Capital Zimbabwe (Private) LimitedImara Capital Botswana Proprietary Limited: Imara Africa Securities (Proprietary) Limited Imara Asset Management (Proprietary) Limited Imara Botswana Limited Imara Capital Limited Imara Capital Securities (Proprietary) LimitedImara Beresford International Limited: Beresford Trust and Corporate Services Limited Imara Trust Company (Mauritius) Limited Imara Fiduciaries Services SARL

Africa Private Equity Fund Managers (Pty) LimitedImara Asset Management (Mauritius) LimitedImara Beresford International LimitedImara Capital Zimbabwe (Private) LimitedImara Capital South Africa (Proprietary) Limited

Note

Note

Note

1

23

5

6

4

Country of registration


Country of registration Percentage of ownership

Percentage of ownership

British Virgin Islands.British Virgin Islands. British Virgin Islands.United Kingdom.British Virgin Islands.Botswana.Kenya.Zambia.British Virgin Islands.

Zimbabwe

BotswanaBotswanaBotswanaBotswanaBotswana

MauritiusMauritiusSwitzerland

BotswanaMauritiusMauritiusZimbabweSouth Africa

50%50% plus 1 share51%46.35%93.75%

46.35%

100%100%100%100%50.10%

51%51%51%



87PAGE |


15.

NotesImara Asset Management (UK) Limited is registered in the United Kingdom and is authorised and regulated by Financial Conduct Authority (“FCA”)( formerly known as the Financial Services Authority (“FSA”))Imara Capital Kenya Limited is an investment holding company registered in Kenya. The company is currently dormant.Imara Capital Zambia Limited is registered in Zambia and owns 25% of Stockbrokers Zambia Limited.Africa Private Equity Fund Managers (Pty) Limited is 50% owned by ICEA Lion Asset Management Limited, a company registered in Kenya.Imara Asset Management (Proprietary) Limited (IAM) was previously 51% owned by Imara Capital Botswana (Pty) Limited (ICAPB) and 49% by Worxnet (Proprietary) Limited. Worxnet (Proprietary) Limited surrendered it 49% shareholding to ICAPB in October 2012 following resolution of a long running dispute.Imara Capital Securities (Proprietary) Limited is 49.90% owned by management and an ex-director of the company. The company is engaged in stockbroking.

1.

2.3.4.

5.

6.

Related parties:

Notes

Imara SP Limited is registered in the British Virgin Islands and is a shareholder in the Group. The company is controlled by a non-executive director.

Etana Trust is registered in Guernsey and is controlled by Beresford Trust and Corporate Services. Etana Trust is a shareholder in Imara Holdings Limited. An executive director of Imara Holdings Limited has an indirect interest in the Etana Trust.

Imara Managed Futures Fund (Proprietary) Limited is an investment holding Trust, registered in South Africa. Imara SP Reid (Pty) Limited provides support services to the Trust and charges an annual management fee, which is accounted for in Imara SP Reid (Pty) Limited.

Imara Securities Angola SVM Limitada is a company in the process of formation which will be registered in Angola. Registration formalities can only be concluded once a stock-broking licence for the new entity has been issued. The licence application is currently pending with the Angolan Authorities. In terms of a Shareholders Agreement, Imara Holdings Limited has the right to subscribe for 50% of the issued share capital of the company upon formation.

Imara South Africa Trust is registered in South Africa and owns 6,25% of the shareholders’ voting rights in Imara Capital South Africa Proprietary Limited. ISAT has two Trustees one of whom is a non-executive director of Imara Capital South Africa Proprietary Limited and the other a non-executive director of Imara SP Reid Proprietary Limited. ISAT is therefore deemed to be a controlled entity and is consolidated in Imara Capital South Africa Group.

1.

Parent and underlying subsidiaries

Imara Capital Zimbabwe (Private) Limited: Imara Asset Management (Private) Limited Imara Corporate Finance Zimbabwe (Private) Limited Imara Edwards Securities (Private) LimitedImara Capital South Africa (Proprietary) Limited: Imara Asset Management South Africa (Pty) Limited Imara Corporate Finance South Africa (Pty) Limited Imara SP Reid (Pty) Limited Imara South Africa Trust

Stockbrokers Malawi Limited Stockbrokers Zambia Limited

Note

1



Indirect % shareholding

Percentage shareholding

ZimbabweZimbabweZimbabwe

South AfricaSouth AfricaSouth AfricaSouth Africa

MalawiZambia

46.35%46.35%46.35%

100.00%100.00%100.00%

25%25%

Subsidiary companies – indirectly held:

Associate companies:

RELATED PARTY DISCLOSURES (continued)

Company:



88PAGE |


RELATED PARTY DISCLOSURES (continued) 15.

Related party transactions and balances:

Beresford Trust and Corporate Services LimitedImara Trust Company Mauritius Limited

Management fee income - Group:Imara Asset Management South Africa Proprietary LimitedImara Botswana LimitedImara SP Reid Proprietary Limited

Management fee income – Non Group:

Imara Managed Futures Fund

Professional fees paid:

Dividends received – Group companies:

CF Africa Limited - BVIImara Asset Management Limited - BVIImara Beresford International Limited – MauritiusStockbrokers Zambia Limited

Interest income – Group companies:Africa Investments Limited - BVIAfrica Private Equity Fund Managers (Pty) LimitedCF Africa Limited - BVIImara Botswana LimitedImara Capital Limited - BVIImara Capital Botswana (Pty) LimitedImara Capital South Africa (Pty) LimitedImara Capital Zambia LimitedImara Capital Zimbabwe (Private) Limited

-----

---------

-

-----

---------

-

845 838-

1 077 67478 980

2 002 492

-119 648

51 041684 705476 568

1 784 2871 009 887

143 380-

4 269 516

488 64411 863 993

1 204 461-

13 557 098

56 98355 714

43 908648 714523 2831 516 735

1 226 963144 214

23

4 216 537

-455 953

455 953

---

-

-

123 881139 893

263 774

---

-

61 675

-45 883

45 883

188 7481 666 800

1 881 120

3 736 668

-

-67 526

67 526

179 2271 500 000

1 765 155

3 444 382

-

Management fee income - Group:

Imara Holdings Limited charges an annual management fee to certain of its subsidiary companies in respect of services rendered to these companies by the Imara Holdings Limited executives.

Management fee income – Non-group:

Imara SP Reid, the South African stockbroker charges an annual management fee to the Imara Managed Futures Fund in respect of support services rendered to this entity.

During the year the Group entered into transactions with the directors and other related parties. These transactions along with related balances at 30 April 2013 and for the period then ended are as follows:

Interest receivable – group companies, relates to interest charged on Accounts Receivable – group companies, which attract interest at 8,50% (2012: 8.50%).

Year ended 30 April

Year ended 30 April

Group2013Pula

Group2013Pula

Group2012Pula

Group2012Pula

Company2013Pula

Company2013Pula

Company2012Pula

Company2012Pula



89PAGE |


RELATED PARTY DISCLOSURES (continued)15.

Amounts due by related parties relate to payments made by Imara Holdings Limited to independent third parties, in respect of company secretarial and administrative fees.Interest is charged on outstanding amounts at 8.50% (2012: 8.50%).

Year ended 30 April

Year ended 30 April

Group2013Pula

Group2013Pula

Group2012Pula

Group2012Pula

Company2013Pula

Company2013Pula

Company2012Pula

Company2012Pula

Interest income – Related parties:Imara Capital Zimbabwe (Private) LimitedImara SP Limited - BVIEtana Trust

Interest receivable - third parties

Interest receivable - non-group

Finance Costs – Group companies:Imara Asset Management Limited - BVIImara Asset Management (Pty) Limited - BotswanaAfrica Investments Limited - BVIImara Trademarks Limited - BVIImara Capital Kenya LimitedImara Capital Zimbabwe (Private) Limited

Finance costs – related party:

Imara SP Limited

Total finance costs (Note 5)

Accounts receivable - Group companies:Long term:Africa Private Equity Fund Managers (Pty) LimitedCF Africa Limited- BVIImara Asset Management (UK) LimitedImara Botswana LimitedImara Capital Limited - BotswanaImara Capital Limited -BVIImara Capital South Africa (Proprietary) LimitedImara Capital Zambia LimitedImara Capital Zimbabwe (Private) Limited

------

-

-

-

---------

-

------

-

-

-

---------

-

2 434 47419 821

-454 080

668-

2 909 043

-

2 909 043

1 012 632539 753

-7 195 465

20 788 9886 488 8997 842 554

1 691 441382 743

45 942 475

2 644 89324 576

1 457 636193 997

685476

4 322 263

1 022

4 323 285

1 693 960658 597

-1 317 967

26 946 6963 603 386

5 306 787 2 222 370

-

41 749 763

---

-

-

-

---

-

-

-

--

8 270

8 270

25 500

16 540

-1 064

16 747

17 811

163 833

181 644



90PAGE |



Accounts payable - Group companies:Africa Investments Limited -BVIImara Asset Management (Pty) Limited- Botswana Imara Asset Management Limited –BVI (See note*)Imara Capital Kenya LimitedImara Trademarks Limited - BVIImara Capital Zimbabwe (Private) Limited

Amounts owed by related parties: (Note 17)Etana Trust (Note 17)Imara SP Limited (Note 17)Xola Sithole (See note below)

Amounts owed to related parties: (Note 21)ICEA Lion Asset Management LimitedNorwegian Investment Fund for Developing Counties (Norfund)

Amounts owed to related parties: (Note 23)Etana TrustImara SP Limited

------

-

--

144 085

144 085

1 379 707

1 377 594

2 757 301

63 0712 469

65 540

------

-

213 77023 735

-

237 505

948 891

937 322

1 886 213

--

-

-318 303

32 454 67411 581

497 208213 424

33 495 190

---

-

-

-

-

63 0712 469

65 540

17 234 001318 801

28 862 8968 077

5 785 143-

52 208 918

213 77023 735

-

237 505

-

-

-

--

-

Accounts receivable - Group companies (continued)

Accounts receivable – group companies are classified as long term, have no fixed terms of repayment, are unsecured and attract interest at a rate of 8.50% (2012: 8.50%) for Botswana, British Virgin Islands and South African incorporated companies. These interest rates equate to market related interest rates for similar type loans in the respective country jurisdictions.

Accounts payable – group companies are classified as non-current liabilities, have no fixed terms of repayment, as agreed by the directors’, are unsecured and attract interest at a rate of 8.50% (2012: 8.50%) for Botswana, British Virgin Islands and South African incorporated companies. These interest rates equate to market related interest rates for similar type loans in the respective country jurisdictions.

Xola Sithole is a proposed director of the yet to be formed Imara Mondise Capital Proprietary Limited, which will be a 50:50 joint venture between Imara Corporate Finance South Africa Proprietary Limited and Mondise Capital Proprietary Limited. Xola Sithole is the sole shareholder of Mondise Capital Proprietary Limited

Year ended 30 April

Group2013Pula

Group2012Pula

Company2013Pula

Company2012Pula



91PAGE |





Non- executivePula

Non- executivePula

ExecutivePula

ExecutivePula

TotalPula

TotalPula

Directors - Group

Directors - Group

Remuneration paid to directors - Group:

Non-executive:FeesExpenses Share based payment expense

Total non-executive

Executive:SalaryShort term benefits

Fixed remunerationPerformance bonusShare based payment expense

Total executive

Total non-executive and executive


Total non-executive



Total executive


1 300 806146 174

13 143

1 460 123

--

---

-

1 460 123

1 204 702200 01110 349

1 415 062

--

---

-

1 415 062

---

-

10 033 227744 018

10 777 2452 272 936

181 926

13 232 107

13 232 107

---

-

8 358 760414 652

8 773 4121 997 457

132 134

10 903 003

10 903 003

1 300 806146 174

13 143

1 460 123

10 033 227744 018

10 777 2452 272 936

181 926

13 232 107

13 232 107

1 204 702200 01110 349

1 415 062

8 358 760414 652

8 773 4121 997 457

132 134

10 903 003

12 318 065

Directors remuneration:

The directors’ remuneration in the note above is in respect of the parent company and includes all executive directors. The amounts disclosed include performance bonuses in respect of the 2012 financial year which were paid in 2013. Such amounts have been charged against prior year provisions for performance bonuses and consequently are excluded from the Income Statement charge for the current year as disclosed in Note 4.



92PAGE |





Non- executivePula

Non- executivePula

ExecutivePula

ExecutivePula

TotalPula

TotalPula

Directors - Group

Directors - Company:

Remuneration paid to directors - Company:


Total non-executive



Total executive



Total non-executive


Fixed remunerationPerformance bonusGratuity paymentShare based payment expense

Total executive


1 300 806146 174

13 143

1 460 123

--

---

-

1 460 123

1 204 702200 01110 349

1 415 062

--

----

-

1 415 062

---

-

4 857 305312 306

5 169 611818 50787 783

6 075 901

6 075 901

---

-

4 097 993555 039

4 653 032674 820271 75877 553

5 677 163

5 677 163

1 300 806146 174

13 143

1 460 123

4 857 305312 306

5 169 611818 50787 783

6 075 901

7 536 024

1 204 702200 01110 349

1 415 062

4 097 993555 039

4 653 032674 820271 75877 553

5 677 163

7 092 225

Directors remuneration:

The directors’ remuneration disclosed in the note above is in respect of the parent company and includes only those executive directors that are paid by the parent company. The amounts disclosed include performance bonuses in respect of the 2012 financial year which were paid in 2013. Such amounts have been charged against prior year provisions for performance bonuses and consequently are excluded from the Income Statement charge for the current year as disclosed in Note 4.



93PAGE |



16.

17.

Year ended 30 AprilRemuneration paid to key management personnel:

Remuneration in respect of key management personnel, is comprised of the following:

Country Company

Key management personnel:

SalaryShort term benefits


BotswanaMauritiusSouth AfricaSouth AfricaZimbabweZimbabweUnited Arab Emirates

Imara Holdings LimitedImara Beresford International LimitedImara SP Reid (Proprietary) LimitedImara Capital South Africa (Proprietary) LimitedImara Capital Zimbabwe (Private) LimitedImara Asset Management Limited - BVIImara Asset Management Limited - BVI

9 093 186746 769

9 839 9553 210 066

186 583

13 237 144

132131-

11

5 377 432144 700

5 522 1322 341 306

113 225

7 976 663

1-21--1

5

2013Pula

Number of Employees

2013

Number of Employees

2012

2012Pula

Listed traded securities

Financial liabilities at fair value through profit and loss

Listed traded securities – sold short

5 276 905

95 169

6 408 778

439 621

-

-

-

-

Year ended 30 April

Year ended 30 April

Group2013Pula

Group2013Pula

Group2012Pula

Group2012Pula

Company2013Pula

Company2013Pula

Company2012Pula

Company2012Pula

LISTED TRADING SECURITIES

Trade receivablesAmounts receivable in respect to broking activitiesCollateral deposits against scrip lendingAmounts receivable – carry accountsSundry receivablesRelated party receivables (Note 15)

TRADE AND OTHER RECEIVABLES

34 022 17350 412 0673 496 386

39 007 8497 263 563

144 085

134 346 123

15 719 9292 171 755

5 389 32241 963 3416 165 669

237 505

71 647 525

----

1 682 825-

1 682 825

----

1 715 436237 507

1 952 943

The fair value of the listed trading securities is determined by reference to published price quotations in active markets. Changes in fair value are recognised through profit and loss.

Financial assets at fair value through profit and loss



94PAGE |


TRADE AND OTHER RECEIVABLES (continued)17.

As at 30 April 2013

As at 30 April 2012

TOTALPula

TOTALPula

TOTALPula

More than 120 days

Pula

91 to 120 days

Pula

61 to 90 days

Pula

31 to 60 days

Pula

Less than 30 days

Pula

Individuallyimpaired

Pula

Individuallyimpaired

Pula

Collectivelyimpaired

Pula

Collectivelyimpaired

Pula

Neither past due nor impaired

Group

Past due but not impaired

Company

Trade receivablesOther receivablesRelated parties

Not classified *

Trade receivablesOther receivablesRelated parties

Not classified *

At 1 May 2011Charge for the yearUtilised

At 30 April 2012Acquired of subsidiaryCharge for the yearUtilised

Total

163 974--

163 974 175 819

2 614 388(163 974)

2 790 207

---

----

-

---

512 098(78 431)

-

433 667

---

----

-

163 974--

163 974687 917

2 535 957(163 974)

3 223 874

---

----

-

18 164 1111 949 669

144 085

20 257 866

13 366 9782 227 781

17 811

8 058 2921 794 984

-

9 853 276

1 587 5051 892 339

-

1 870 7801 187 007

-

3 057 787

-28 122

-

1 347 81731 357

-

1 379 174

765 44678 492

9 473

2 451 621735 601

-

3 187 222

-1 938 932

210 221

31 892 6215 698 618

144 085

37 735 324 96 610 798

134 346 122

15 719 9296 165 666

237 505

22 123 10049 524 425

71 647 525

Trade receivables are non-interest bearing and are generally on 30 to 60 day terms.

Amounts receivable in respect of broking activities are due on demand and do not attract interest.

Collateral deposits against scrip lending attract interest on a floating rate basis at variable rates. The rate applicable on 30 April 2013 was 4,80%, (2012: 5,30%). The repayment period for amounts due in respect of certain collateral deposits against scrip lending are contract specific. None of these balances were past due at year end.

Loans receivable, in respect of carry accounts, are due on demand and attract interest at floating interest rate of between 7.30% and 11.50%. (2012: 7.0% to 11,50%)

Impairment losses, where applicable, are charged through the use of an allowance account.

Financial assets pledged as collateral:The Group had pledged cash amounting to P 5 094 956 (2012: P5 389 322) as collateral for scrip lending transactions. No other financial assets have been pledged as collateral for financial liabilities or contingent liabilities.As at 30 April, the ageing analysis of trade and other receivables is as detailed below. These balances are neither past due nor impaired :

Not classified items relate to amounts receivable in respect of broking activities, carry accounts and collateralised scrip lending.No other class of financial assets are past due as at the balance sheet date.Movements in the provision for past due trade receivables and sundry receivables were as follows:



95PAGE |


CASH AND CASH EQUIVALENTS

TAX REFUNDABLE

STATED CAPITAL

18.

19.

20.

Year ended 30 April

Year ended 30 April

Year ended 30 April

Group2013Pula

Group2013Pula

Group2012Pula

Group2012Pula

Company2013Pula

Company2013Pula

Company2013

Number

Company2012Pula

Company2012Pula

Company2012

Number

Cash on hand and at bankShort term deposits

For purposes of the Statement of Cash Flows, cash and cash equivalents comprise the following:Cash and cash equivalents - per aboveBank overdraft (Note 2)

Imara SP Reid (Proprietary) LimitedImara Capital Zimbabwe (Private) Limited

Authorised share capital:200 000 000 ordinary shares of no par value

Reconciliation of the number of shares in issue:In issue at beginning of the yearShares issued:- under the Share Option Scheme- as part consideration for the acquisition of investments in associates and subsidiaries (Note 13)

In issue at end of the year

59 140 301

11 500-

59 151 801

58 162 419

339 993637 889

59 140 301

55 426 47214 379 205

69 805 677

69 805 677(2 119)

69 803 558

629 277174 778

804 055

1 013 676223 335

1 237 011

--

-

--

-

73 838 60710 732 625

84 571 232

84 571 232(79 640)

84 491 592

16 000 025-

16 000 025

16 000 025-

16 000 025

23 462 229-

23 462 229

23 462 229-

23 462 229

Rand call deposits bear interest, linked to prime, of between 1.0% and 4.8% per annum (2012: 1.00% and 5.38%).

Short-term deposits held with African Alliance and Stanbic Investment Management Services (Proprietary) Limited, have effective returns of between 5.01% and 6.67% per annum (2012: 5.01% and 6.39%).

Foreign bank balances attracted interest during the year of between 0.0% and 0.50% per annum (2012: 0.00% and 0.50%).The Group’s cash which has been identified as not being immediately required for operational purposes is invested in a foreign currency denominated accounts in Mauritius. The foreign currencies held include Swiss Franc (CHF), United States dollars (USD) and Pounds Sterling (GBP).

Tax refundable is the result of the overpayment of provisional tax payments against the final assessed tax liability. The amount is refundable by deduction from future provisional tax payments.

Issued capital:



96PAGE |


STATED CAPITAL (continued) 20.



Notes relating to issued capital:

The holders of ordinary shares are entitled to receive dividends as and when declared by the company. All ordinary shares carry one vote per share without restriction.The un-issued ordinary shares are under the control of the directors.

Stated capitalPula

Stated capitalPula

Company: Balance at beginning of year Movement for the year: Share options exercised

Balance at end of year

Company: Balance at beginning of yearMovement for the year Share options exercised Acquisition of non-controlling interest in CF Africa Limited

Balance at end of year

50 914 889

16 123

59 931 012

48 532 981

487 3771 894 531

50 914 889

Issued capital:

INTEREST BEARING LOANS AND BORROWINGS21.Year ended 30 April

Group2013Pula

Group2012Pula

Company2013Pula

Company2012PulaLong term portion:

Related party capital contributions –see note below

Current portion:

Shareholders’ dividends – see note below

Bank overdraft – see note below

2 757 301

3 295 644

2 119

1 886 213

3 486 053

79 640

-

-

-

-

-

-



97PAGE |


INTEREST BEARING LOANS AND BORROWINGS (continued)

TRADE AND OTHER PAYABLES

21.

22.

Year ended 30 April

Group2013Pula

Group2012Pula

Company2013Pula

Company2012Pula

Trade payables Amounts payable in respect of broking activitiesOther payablesAccruals Listed securities sold shortRelated party payables (Note 15)

15 799 49563 549 082

14 178 10211 448 240

62 00665 540

105 102 465

10 585 29417 123 025

8 679 06210 407 278

--

46 794 659

--

254 9351 955 630

--

2 276 105

--

278 8961 421 330

--

1 700 226

Related party capital contributions:

ICEA Lion Asset Management is a shareholder in Africa Private Equity Fund Managers (Pty) Limited and Norfund is a related party. The long term interest bearing borrowings relate to amounts contributed by these entities to the working capital requirements of Africa Private Equity Fund Managers (Pty) Limited.

Shareholders’ dividends:

In terms of the BEE transaction with Zingwenya Holdings Limited (Proprietary) Limited, (“Zingwenya”), dividends declared by South African group companies, accrued to Zingwenya, but were withheld pending settlement of the BEE transaction. The BEE transaction terminated in April 2011 but the dividends previously withheld were retained pending finalisation of discussions relating to a new empowerment deal. The dividends withheld accrue interest at the RSA R154 Bond yield to maturity plus 2%. The full amount outstanding from the previous year was reversed through retained earnings in April 2013 and is also detailed in the Statement of Changes in Equity.

Bank overdraft:

Limited utilisation of overdraft facilities by group companies occurred during the year. At the reporting date, Imara Capital Securities (Pty) Limited was the only company with a bank overdraft. Bank overdrafts are unsecured and attract interest at the prime bank overdraft rate of 8.50% per annum in South Africa and 11.00% per annum in Botswana. (2012: 9.00%). Bank overdraft is separately disclosed in the Statement of Financial Position.

RETIREMENT BENEFIT OBLIGATIONS

23.

Year ended 30 April

Group2013Pula

Group2012Pula

Company2013Pula

Company2012Pula

Retirement benefit obligations (See note below) 535 205 - - -

The retirement benefit obligation relates to Imara Beresford International Limited – Mauritius. The amount is in respect of statutory gratuity payments due to employees on retirement. In terms of the Mauritius Employment Rights Act, employees are entitled to a gratuity on retirement equivalent to half a month’s salary at the date of retirement, multiplied by the number of years in service. No gratuity is payable when an employee resigns before the retirement age and any gratuity accrued in respect of the employee resignations are written back to income. The company gratuity scheme is unfunded and the liability is calculated on the assumption that employees will reach their retirement age. The year-end retirement benefit liability is calculated by discounting the projected accrued gratuity for the in service period at a discount rate of 10%. The annual salary increment is assumed to be 10% per annum.

Trade payables are non-interest bearing and are normally settled on 30 to 60 day terms

Amounts payable in respect of broking activities are non-interest bearing and are settled within five days of the transaction date.

Other payables are non-interest bearing and have average terms of between 30 and 60 days.



98PAGE |


FUNDS UNDER MANAGEMENT

COMMITMENTS AND CONTINGENCIES

24.

25.

Year ended 30 April

The Group provides asset management and unit trust services to pension funds, trusts, institutions, companies and individuals, whereby it holds, places and manages funds on behalf of clients. The Group receives management fees for providing these services. Funds under management are not assets of the Group and are not recognised in the statement of financial position. The Group is not exposed to any credit risk relating to funds under management.

Operating lease commitments: Operating leases - Company as lessee: The Group has entered into commercial lease agreements in relation to office premises in Botswana, Mauritius, South Africa and Zimbabwe.

The Botswana lease, in respect of premises situated in the new Central Business District of Gaborone, has a remaining lease term of 55 months and expires on 30 November 2017. The lease is renewable for a further five years on terms to be mutually agreed between tenant and landlord;

The Mauritius lease, in respect of premises situated in Ebene, Cybercity, has a remaining lease term of 7 months and expires on 30 November 2013. The lease is renewable for a further 5 years on terms to be mutually agreed between tenant and landlord;The South African lease, in respect of premises situated in Illovo in Johannesburg, has a remaining lease term of 58 months. The lease is not renewable.

The Zimbabwe lease, in respect of premises situated in Eastlea, Harare, has a remaining lease term of 21 months and expires on 31 December 2014. The lease is renewable by negotiation.

Future minimum rentals payable under non-cancellable operating leases are as follows:

Operating leases - Company as lessor:

The Group has entered into commercial property sub-lease agreements in relation to the rental of office space in both Botswana and South Africa. The sub-lease agreements are with subsidiary companies. These non-cancellable leases are on terms similar to the head lease agreement, and have remaining terms of 55 months in relation to Botswana and 58 months in relation to South Africa. The lease agreements include a clause allowing for an upward revision of the rental charge on an annual basis.

Future minimum rentals receivable under non-cancellable operating leases are as follows:

No disclosure has been made in respect of the financial impact of the sub-lease agreements for subsidiary companies, as on a Group consolidated basis the financial amounts are eliminated.

Group2013Pula

Group2012Pula

Funds under management – Group companies 4 260 808 604 3 053 853 417

Within one yearAfter one year but not more than five years

4 721 69214 028 040

18 749 732

3 608 36310 463 387

14 071 750

689 5272 453 028

3 142 555

258 228-

258 228

Year ended 30 April

Group2013Pula

Group2012Pula

Company2013Pula

Company2012Pula

Within one yearAfter one year but not more than five years

379 7991 351 154

1 730 953

129 114-

129 114

379 7991 351 154

1 730 953

129 114-

129 114

Year ended 30 April

Group2013Pula

Group2012Pula

Company2013Pula

Company2012Pula



99PAGE |


COMMITMENTS AND CONTINGENCIES (continued)

SHARE BASED PAYMENTS

25.

26.

Year ended 30 April

Imara Securities Angola SVM Limitada:

Imara Securities Angola SVM Limitada is an Angolan registered company in the process of formation. Registration formalities can only be concluded once a stock-broking licence for the new entity has been issued. A new licence application is currently under consideration by the Angolan Authorities. In terms of a Shareholders Agreement, Imara Holdings Limited has the right to subscribe for 50% of the issued share capital of the company upon formation. The minimum capital requirement for a stockbroking company in Angola was originally set at USD500 000 but was reduced to USD200 000 in 2012-2013. The capital commitment reflected above represents Imara’s 50% share of this capitalisation.


In terms of a Share Sale and Shareholders Agreement, Imara Holdings Limited has the right to acquire an additional 2,2% of the issued equity of Imara Beresford International Limited in 2013-2014. Notice has not been given to exercise this right. A pricing formula for the acquisition of additional shares is contained in the Share Sale and Shareholders Agreement and in terms of this formula, the cost of an additional 2,2% equity tranche would be approximately P678 800.

Equipment:

Capital expenditure of P794 400 has been authorised but not yet committed for the year ending 30 April 2014. (For the year ending April 2013 – P590 455.)

Share based payment plan:

The share option scheme introduced by the company in its 2005 financial year is defined as an “equity settled scheme”. Under the scheme share options are granted to directors and employees with more than 12 months service. In terms of the scheme, up to 10% of the issued share capital of the Company at any one time is available to the Directors to grant share options. Minor modifications were made to the Scheme in 2006 in order to ensure compliance with the requirements of the Botswana Stock Exchange, ahead of the Company’s listing.

The exercise price of the options is equal to the market price of the shares on the date of grant. The exercise period for each option is five years. One third of the options granted vest in each financial year, provided that the grantee is still in the employ of the Company, and performance criteria are not taken into account. The full price of any option granted, must be settled in cash before shares are allotted.

The holders of share option grants, as at 2 August 2007, were eligible for the 10 for 1 share split implemented by the Company.

Capital commitments:At 30 April 2013 and 2012 the Group has the following capital commitments:

2013Pula

2012Pula

Imara Securities Angola SVM Limitada – see note belowImara Beresford International Limited – see note belowCapital expenditure authorised in the April 2014 budgets but not yet committed

801 2181 543 0001 879 400

4 223 618

1 802 5431 375 700

-

3 178 243



100PAGE |


SHARE BASED PAYMENTS (continued)26.

30 April 2013

30 April 2012

The range of exercise prices for options outstanding at the end of the year was P2.46 to P12.50. (2012: P1.402 to P12.50)

The expense recognised during the year in respect of services received and the apportionment of this cost to operating companies within the Group is as follows:

Share based payment plan:

During the year, the following options were granted:

Number of options

Number of options

2013Pula

Expiry date

Expiry date

Option pricePula

Option pricePula

2012Pula

18 July 2012

28 November 2012

20 July 2011

Imara Holdings LimitedImara Asset Management South Africa Proprietary LimitedImara Asset Management Limited - BVIImara Botswana LimitedImara Capital South Africa Proprietary LimitedImara SP Reid Proprietary LimitedImara Africa Securities Proprietary LimitedImara Capital Zimbabwe (Private) LimitedImara Capital Securities (Proprietary) Limited

Grant Date

Grant Date

1 250 000

125 000

1 375 000

483 000

184 928117 282164 613

104 56939 828221 420

-16 5514 965

854 156

17 July 2017

27 November 2017

19 July 2016

2.55

2.46

3,00

131 61092 195

135 52089 06526 570

177 9683 603

--

656 531



101PAGE |


SHARE BASED PAYMENTS (continued)26.Share based payment planThe following table illustrates the number and weighted average exercise prices, (“WAEP”), of and movements in, share options granted since inception of the option scheme.

The following table lists the inputs to the binomial valuation model used for the year.

Expected volatility is a measure of the expected price fluctuations of the underlying share. As the Imara share was not publicly quoted at certain of the grant dates, and has only been listed since 4 October 2006, reliable historical trading data relating to the share is not available. Volatility has therefore been determined by reference to listed companies, which could be regarded as proxies for Imara Holdings Limited. Expected volatility reflects the assumption that historical volatility is indicative of future trends, which may not necessarily be the actual outcome.

Year ended 30 April

2013Number

2013WAEP

2012Number

2013

2012WAEP

2012

Outstanding - beginning of year Granted during the yearForfeited during the yearLapsed during the yearExercised during the year

Outstanding and exercisable - end of the year

Dividend yield Expected volatilityRisk free interest rateWeighted average share price - exercisable options

2 916 1631 375 000(532 330)

(267 000)(11 500)

3 480 333

2.42692.5418

4.49622.88991.4020

2.44526

%%%

Pula

2 925 656483 000(152 500)

-(339 993)

2 916 163

0.81% to 0.85%37.27% to 37.44%7.97% to 8.00%

3.78133

2.385863.00000

6.35573-

1.43349

2.42689

1.25%38.43%

7.72%4.40527



102PAGE |

* Financial instruments classified as trading securities are designated at fair value through profit and loss.** Amounts disclosed as non -financial instruments relate to Value Added, Withholding and Pay As You Earn taxes.


FINANCIAL INSTRUMENTS27 .

As at 30 April 2013

As at 30 April 2012

The tables below summarise the classification of the Group’s financial instruments:

Loan and receivables

Pula


Pula

Non-financial instruments

(**)Pula


(**)Pula

Financial liabilities at

amortised costPula


amortised costPula

Available-for-sale financial

instrumentsPula


instrumentsPula

AFVTPL*Pula

AFVTPL*Pula

TOTALPula

TOTALPula

ASSETS:Available-for-sale financial instrumentsListed traded securitiesTrade and other receivablesCash and cash equivalents

LIABILITIES:Interest bearing borrowings - long termInterest bearing borrowings - short termListed trading securities – sold shortTrade and other payables Bank overdraft


LIABILITIES:Interest bearing borrowings - long termInterest bearing borrowings - short termListed trading securities – sold shortTrade and other payables Bank overdraft

-5 276 905

--

5 276 905

-6 408 778

--

6 408 778

-

-

95 169--

95 169

-

-

439 621--

439 621

21 180 571---

21 180 571

17 866 934---

17 866 934

-

-

---

-

-

-

-

-

-

----

----

-

2 757 301

3 295 644

-103 212 798

-

109 265 743

1 886 213

3 486 053

-45 172 495

-

50 544 761

----

----

-

-

-

-1 889 667

-

1 889 667

-

-

-1 622 164

-

1 622 164

-

134 346 12369 805 677

204 151 800

--

71 647 52584 571 232

156 218 757

-

-

--

2 119

2 119

-

-

-

79 640

79 640

21 180 5715 276 905134 346 123

69 805 677

230 609 276

17 866 9346 408 77871 647 52584 571 232

180 494 469

2 757 301

3 295 644

95 169105 102 465

2 119

111 252 698

1 886 213

3 486 053

439 62146 794 659

79 640

52 686 186



103PAGE |


FINANCIAL INSTRUMENTS (continued)27.The tables below summarise the classification of the Company’s financial instruments:

As at 30 April 2013

As at 30 April 2012


Pula


Pula


(See note below)Pula


(See note below)Pula


amortised costPula


amortised costPula


instrumentsPula


instrumentsPula

TOTALPula

TOTALPula


LIABILITIES:Accounts payables – group companiesTrade and other payables


LIABILITIES:Accounts payables – group companiesTrade and other payables

259 194---

259 194

--

-

255 110---

255 110

--

-

----

-

33 495 1902 276 105

35 771 295

----

-

52 208 9181 608 245

53 817 163

----

-

--

-

----

-

-91 981

91 981

-41 749 7631 682 825

16 000 025

59 432 613

--

-

-45 942 475

1 952 94323 462 229

71 357 647

--

-

259 19441 749 7631 682 825

16 000 025

59 691 807

33 495 1902 276 105

35 771 295

255 11045 942 475

1 952 94323 462 229

71 612 757

52 208 9181 700 226

53 909 144



104PAGE |

Financial risk management objectives and policies

The Group’s principal financial instruments are detailed in the table above. The main purpose of these financial instruments is to finance the Group’s operations.

The main risks arising from the Group’s financial instruments are credit risk, equity price risk, interest rate risk, foreign currency risk, liquidity risk and securities exchange trading risk.

Credit risk

The Group’s policy is to trade only with recognised and creditworthy third parties. All customers who wish to trade on credit terms are subject to credit vetting and “know your customer” procedures before any credit is extended.

With respect to credit risk arising from the other financial assets of the Group, comprising cash and cash equivalents and trade and other receivables, the Group’s exposure to credit risk arises from default of the other party, with a maximum exposure equal to the carrying amount of these instruments. There are no significant concentrations of credit risk.

Equity price risk

Equity price risk is the risk that the fair values of equity instruments decrease as a result of changes in the levels of equity indices and the value of individual stocks. The equity price risk exposure arises from the Group’s listed trading securities portfolio. The sensitivities are calculated by multiplying the year end balances with the reasonable possible changes.


FINANCIAL INSTRUMENTS (continued)27 .

As at 30 April 2013

The table below summarises by class of financial instruments, the net gains and losses, relating to these instruments.

Net gains and losses

Impairment losses

Pula

Fair value movements

PulaInterest paid

PulaInterest received

PulaTOTAL

Pula

Loans & receivablesFinancial assets held at fair value through profit and lossFinancial liabilities at amortised cost

Total

Group:

Loans & receivablesFinancial assets held at fair value through profit and lossFinancial liabilities at amortised cost

Total

Company:

Loans and receivablesFinancial liabilities at amortised cost

Company:

Loans and receivablesFinancial liabilities at amortised cost

3 541 228

416 129396 768

4 354 125

3 953 735

2 467 409(510 042)

6 421 144

4 313 286(4 323 285)

(4 323 285)

4 216 537(2 909 043)

1 307 494

3 541 228

--

3 541 228

3 953 735

--

3 953 735

4 313 286-

4 313 286

4 216 537-

4 216 537

-

-396 768

396 768

-

-(510 042)

(510 042)

-(4 323 285)

(4 323 285)

-(2 909 043)

(2 909 043)

-

416 129-

416 129

-

2 467 409-

2 467 409

--

-

--

-

-

--

-

-

--

-

--

-

--

-

As at 30 April 2012

As at 30 April 2013

As at 30 April 2012

Group:



105PAGE |


FINANCIAL INSTRUMENTS (continued)27.Equity price risk (continued)

The effect on equity as a result of a change in the fair value of listed trading securities due to a reasonably possible change in the Botswana Stock Exchange, Johannesburg Stock Exchange, Nigerian Stock Exchange and Zimbabwe Stock Exchange All Share Index, with all other variables held constant, is as follows:

The effect on equity as a result of a change in the fair value of listed trading securities due to a reasonably possible change in the Botswana Stock Exchange, Johannesburg Stock Exchange, Nigerian Stock Exchange and Zimbabwe Stock Exchange All Share Index, with all other variables held constant, is as follows:

Effect on profit before tax

Pula


Pula


Pula


Pula

Change in equity price

%


%

Available-for-sale financial assets:

Available-for-sale financial assets:

Group 2013

Company 2013

Group 2012

Company 2012


%


%

Market indices:Botswana Stock ExchangeJohannesburg Stock ExchangeNigeria Stock ExchangeZimbabwe Stock Exchange




30303030

(15)(15)(15)(15)

30303030

(15)(15)(15)(15)

30303030

(15)(15)(15)(15)

30303030

(15)(15)(15)(15)

26 0042 756 5673 400 437

5 667

(13 002)(766 597)

(1 700 219)(2 834)

-1 554 521

--

-(777 260)

--

26 0042 938 6322 163 051

43 667

(13 002)(1 469 316)(1 081 526)

(21 834)

-1 790 747

--

-(895 374)

--



106PAGE |

Interest rate risk

The Group’s exposure to market risk for changes in interest rates, relate primarily to its bank and cash balances, collateral deposits against scrip lending and loans receivable on carry accounts. The Group’s policy is to manage interest receivable through a mix of demand and short term investment products using both fixed and variable rates.

The Company’s exposure to market risk for changes in interest rates, relate primarily to its bank and cash balances.

The Group has only limited interest bearing borrowings. Its policy to manage interest payable is by using a mix of demand and short term borrowings, and also a mix of fixed and variable interest rates. Demand borrowings, such as bank overdrafts, are managed on a daily basis and are repaid whenever the Group has surplus operational cash resources. The parameters for managing the mix between demand and short-term borrowings, and between fixed rate and variable rate debt have not been formalised into a Group policy.

Interest rate risk table

The following table demonstrates the sensitivity to a reasonably possible change in interest rates on the Group’s profit after tax (through the impact of variable rate call deposits), with all other variables held constant.

Foreign currency risk

As a result of the investment in subsidiary company operations in British Virgin Islands, Mauritius, South Africa and the United Kingdom, and investments in associate companies in Malawi and Zambia, the Group’s Statement of Financial Position can be affected by movements in the USD/ Pula, Rand/Pula, USD / Rand and Sterling/Pula exchange rates. The Statement of Financial Position items which are most susceptible to foreign currency risk are “Cash and cash equivalents” and “Group company receivables and payables”. The Group also has transactional currency exposures which occur in the normal course of business. Such exposures arise from sales or purchase by an operating unit in currencies other than the unit’s measurement currency. Steps have been taken to formalise the management of foreign currency risk through the EXCO Committee and the issuance of a foreign currency risk management policy. Cash and cash equivalents which are surplus to operational working capital requirements are actively managed and invested in a mix of foreign currencies comprising Pula, Rand, USD and Sterling. Intra-group loans are settled as and when cash flows permit and are reviewed monthly.

The following table demonstrates the sensitivity to a reasonably possible change in the Rand, USD and Sterling exchange rates with the Pula, with all other variables held constant, on the Group’s profit before tax (due to changes in the fair value of monetary assets and liabilities) and the Group’s equity.



Percentage increase

Effect on profit before

tax

Increase / (decrease) in

exchange rate

Swiss Franc (CHF) United States Dollars (USD) Pounds Sterling (GBP)


2012Pula


tax


exchange rate


2013Pula


exchange rate


tax

Group:

Company:

2013:

2012:

7.0%(3.0%)

7.0%(3.0%)

299(128)

840 478(360 205)

7.0%(3.0%)

7.0%(3.0%)

407 269(174 544)

263 302(112 844)

2.5%(1.25%)

2.5%(1.25%)

142 833(71 416)

154 167(77 083)

589 344982 239

8 30413 840

0.75%1.25%

0.75%1.25%

597 764996 274

175 134291 890



107PAGE |


FINANCIAL INSTRUMENTS (continued)27.Foreign currency risk (continued)

The following table demonstrates the sensitivity to a reasonably possible change in the Rand and USD exchange rates with the Pula, with all other variables held constant, on the Group’s and Company equity. The exchange rate risk arises primarily from intra-group loans that are treated as a part of the net investment in subsidiary and any exchange rate differences are taken to equity.

Liquidity risk

The Group’s objective is to maintain a balance between continuity of funding and flexibility through the use of overdrafts, bank loans, finance leases and hire purchase contracts.

The table below summarises the maturity profile of the Group’s financial liabilities at 30 April 2013 and 2012, based on contractual un-discounted payments.

1 to 5 years

Pula

On demand

Pula

Total

Pula

3 to 12 months

Pula

More than 5 years

Pula

Less than 3 months

PulaAt 30 April 2013:Interest bearing loans and borrowings – long termInterest bearing loans and borrowings – short termTrade and other payablesBank overdraft

At 30 April 2012:Interest bearing loans and borrowings – long termInterest bearing loans and borrowings – short termTrade and other payablesBank overdraft

-

--

2 119

2 119

-

--

79 640

79 640

-

-103 212 798

-

103 212 798

-

-45 172 495

-

45 172 495

2 757 301

3 295 644--

6 052 945

1 886 213

3 486 053--

5 372 266

-

---

-

----

-

-

---

-

----

-

2 757 301

3 295 644103 212 798

2 119

109 267 862

1 886 213

3 486 05345 172 495

79 640

50 624 401


tax


exchange rate

Swiss Franc (CHF) United States Dollars (USD) Pounds Sterling (GBP)


tax


exchange rate


exchange rate


tax

7.0%(3.0%)

7.0%(3.0%)

299(128)

840 478(360 205)

7.0%(3.0%)

7.0%(3.0%)

397 429(170 327)

263 302(112 844)

2.5%(1.25%)

2.5%(1.25%)

142 833(71 416)

154 167(77 083)

Company:

2013:

2012:


exchange rate


exchange rate

Rand United States Dollars (USD)

Effect on equity

2012

Effect on equity

2012

Effect on equity

2013

Effect on equity

2013

2.5%(1.25%)

132 670(66 335)

196 064(98 032)

2.5%(1.25%)

37 177(15 933)

26 792(11 482)

Group:



108PAGE |

Liquidity risk (continued)

The table below summarises the maturity profile of the Company’s financial liabilities at 30 April 2013 and 2012, based on contractual un-discounted payments.

Accounts payable - Group

Accounts payable - Group have no fixed repayment terms and are therefore excluded from the table above.

Securities exchange trading risk

Companies in the Group periodically short the market and are therefore exposed to short-term fluctuations in the market prices of the securities shorted. Trading risk management is based on the principle that dealer and trading limits are in place, trading risks are properly identified, measured, reported and monitored on a daily basis.

Capital management

The Group itself is not subject to any statutory or regulatory capital adequacy or liquidity prudential controls. The primary objective of the Group’s capital management is to ensure that it maintains prudent capital and gearing ratios in order to support its business and maximise shareholder value.

The Stockbroking Division is subject to capital adequacy and liquidity controls imposed by the regulators and Stock Exchanges in the jurisdictions where they are licensed to operate. Responsibility for compliance with the prescribed capital and liquidity ratios is delegated to the respective Risk and Compliance Committees, which meet on a regular basis.

The individually regulated companies within the Group have complied with all externally imposed requirements throughout the year.

The Group manages its capital structure and makes adjustments to it in light of changes in economic conditions. To maintain or adjust the capital structure, the Group may capitalise intra-Group loan accounts, adjust the dividend payments to shareholders, offer scrip in lieu of dividends, buy back its shares, issue new shares, adjust gearing ratios or negotiate borrowings. The Group’s capital management is measured monthly against a selected range of industry benchmarks.

Capital comprises equity attributable to the shareholders of the parent company.

No material changes were made to the objectives or policies relating to the management of capital during the year.



1 to 5 years

Pula

On demand

Pula

Total

Pula

3 to 12 months

Pula

More than 5 years

Pula

Less than 3 months

PulaAt 30 April 2013:Trade and other payables

At 30 April 2012:Trade and other payables

-

-

2 276 105

1 608 244

-

-

-

-

-

-

2 276 105

1 608 244



109PAGE |


FINANCIAL INSTRUMENTS (continued)27.

Net fair values

Financial instruments at fair value are either priced with reference to a quoted market price for that instrument or by using a valuation model. Where a valuation model is used, the methodology is to calculate the expected cash flows for the specific financial instrument and then discount these values back to a present value.

The fair value of long term loans are estimated using discounted cash flows applying appropriate market rates.

The carrying amounts of trade and other receivables, cash and cash equivalents, trade and other payables approximate their fair value due to the short term nature of the instruments.

Set out in the table below is a comparison by category of carrying amounts and fair values of financial instruments for the Group.

Group2013Pula

Carrying amount Fair value

Group2012Pula

Group2013Pula

Group2012Pula

Financial assets:Available-for-sale-financial assetsTrade and other receivablesListed trading securitiesCash and cash equivalents

Financial liabilities:Interest bearing borrowings – long termInterest bearing borrowings – short termTrade and other payablesListed trading securities sold shortBank overdraft

21 180 571134 346 1235 276 905

69 805 677

230 609 276

2 757 3013 295 644

105 102 46595 169

2 119

111 252 698

17 866 93471 647 5256 408 77884 571 232

180 494 469

1 886 2133 486 053

46 794 659439 62179 640

52 686 186

21 180 571134 346 1235 276 905

69 805 677

230 609 276

2 757 3013 295 644

105 102 46595 169

2 119

111 252 698

17 866 93471 647 5256 408 77884 571 232

180 494 469

1 886 2133 486 053

46 794 659439 62179 640

52 686 186

Group

Set out in the table below is a comparison by category of carrying amounts and fair values of financial instruments of the Company.

Company2013Pula

Carrying amount Fair value

Company2012Pula

Company2013Pula

Company2012Pula

Financial assets:Available-for-sale-financial assetsTrade and other receivablesCash and cash equivalents


Trade and other payables

259 1941 682 825

16 000 025

17 942 044

2 276 105

255 1101 952 942

23 462 229

25 670 281

1 700 225

259 1941 682 825

16 000 025

17 942 044

2 276 105

255 1101 952 942

23 462 229

25 670 281

1 700 225

Company



110PAGE |

Determination of fair value and fair value hierarchy:

The Group uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

Level 1: quoted prices in active markets for identical assets and liabilities;Level 2: other techniques for which all inputs that have a significant effect on the recorded fair value are observable, either directly or indirectly.

The following table shows an analysis of financial instruments recorded at fair value by level of the fair value hierarchy:



GroupPula

GroupPula

Level 1 Level 2

CompanyPula

CompanyPula

Financial assets:Available-for-sale financial assetsListed trading securities

Total financial assets


Listed trading securities – sold short

20 940 2705 276 905

26 217 175

95 169

18 891-

18 891

-

240 301-

240 301

-

240 301-

240 301

-

As at 30 April 2013

Level 1 Level 2

Financial assets:Available-for-sale financial assetsListed trading securities

Total financial assets


Listed trading securities – sold short

Total financial liabilities

17 626 6336 408 778

24 035 411

439 621

439 621

14 809-

14 809

-

-

240 301-

240 301

-

-

240 301-

240 301

-

-

As at 30 April 2012

GroupPula

GroupPula

CompanyPula

CompanyPula

Included in the Level 1 category are financial assets and liabilities that are measured in whole or in part by reference to published quotes in an active market. A financial instrument is regarded as quoted in an active market if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service or regulatory agency and those prices represent actual and regularly occurring market transactions on an arm’s length basis.

The Group does not have Level 3 financial assets. Level 2 financial assets comprise unlisted financial assets whose fair value is based on inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices). Level 3 financial assets are those financial assets whose fair value is based on inputs for the asset or liability that are not based on observable market data.

Level 2 financial assets include Botswana Stock Exchange Proprietary Rights and Angola Stock Exchange Securities which are accounted for using appropriate observable valuation techniques.



111PAGE |


EVENTS AFTER THE REPORTING PERIOD

LETTERS OF GUARANTEE- PARENT COMPANY28.

Imara Holdings Limited , the Group parent company, has signed Letters of Guarantee for the benefit of the other creditors both past and present of a number of its subsidiaries for so much of their claims that would enable the claims of such creditors to be paid in full.

The Letters of Guarantee will remain in force and effect in respect of each subsidiary for which such an agreement has been given only so long as that subsidiary’s liabilities exceed its assets, fairly valued and shall lapse immediately upon that date.

There have been no events, facts or circumstances of a material nature that have occurred subsequent to the reporting date which necessitate an adjustment to the disclosure in these Annual Financial Statements or the notes thereto.

29.

FOREIGN CURRENCY TRANSLATION RATES30.

2013 20112012 2010 2009

Pula : US DollarPula : British SterlingPula : South African RandPula : Kenya ShillingPula : Malawi KwachaPula : Mauritian RupeePula : Zambia KwachaSouth African Rand : US Dollar

Reciprocal rates:United States Dollar: PulaUnited States Dollar: RandBritish Sterling : PulaSouth African Rand : PulaKenya Shilling : PulaMalawi Kwacha : PulaMauritian Rupee : PulaZambia Kwacha : Pula

8.01212.4240.8860.0940.0190.249

0.001509.042

0.1250.111

0.0801.129

10.64952.086

4.019665.100

7.21011.723

0.9370.0910.0460.268

0.001457.692

0.1390.130

0.0851.067

10.99421.9713.730

687.290

6.26810.4450.9520.0740.0410.246

0.001316.586

0.1600.152

0.0961.051

13.48924.3894.069

760.968

6.94810.6000.9400.0830.0440.209

0.001397.391

0.1440.135

0.0941.064

11.98622.9057

4.777718.178

7.41410.9100.861

0.0870.0500.205

0.001268.609

0.1350.116

0.0921.161

11.45620.17

4.879794.365



113PAGE |

SHAREHOLDER INFORMATION AT 30 APRIL 2013

Top 20 Shareholders of Imara Holdings Limited

Legal status of shareholders

Percentageinterest

Percentageinterest

Total sharesheld

Foreign

Country

Local

Reference

Number ofshareholders

NameRank

123456789

10111213141516171819

20

Etana TrustStanbic Nominees BotswanaFirst National Nominees (Pty) LimitedBTCS Nominees LimitedImara S P Limited Fahris Limited Capita Life & Pensions Regulated Services LimitedStandard Chartered Botswana Nominees (Pty) LimitedElsingham Investments Limited Rhodora LimitedCannon International LimitedFNB Botswana Nominees (Pty) LtdIdlewild Investments LimitedBasfour 883 (Pty) LimitedFindlay. James AnthonyStanbic Nominees Botswana (Pty) LimitedOstrer. Neil MarkBTCS Nominees LimitedStock Market Investments LimitedBTCS Nominees Limited

Total number of shares held by the top 20 shareholders

Total number of shares in issue

Companies - Botswana registeredCompanies - Foreign registeredIndividuals - Botswana resident- citizenIndividuals - Botswana resident- non citizenIndividuals - Foreign resident - non citizenInvestment companies and trustsNomineesPension fundsStockbrokers

Percentage

34 31

64 90 30

53 1 2

260

2 641 144

306 485 358 950

282 605

3 323 485 119 334

7 032 003

11,89%

43 875 865

4 135 113

4 108 820

52 119 798

88,11%

4,47%74,18%0,52%0,61%

6,99%0,48%6,95%5,62%0,20%

100,00%

100,00%

RET01

IMARA SPR

RC0008

H01947I

MAU 067/001

FAM BPOPF

BNYFM

RC0068

RT0001

MauritiusSouth AfricaSouth AfricaUnited KingdomMauritiusIsle of ManUnited KingdomMauritiusGuernseyJerseyGuernseyBotswanaSwitzerlandSouth AfricaUnited KingdomUSAUnited KingdomUnited KingdomFranceUnited Kingdom

5 913 859 3 850 706 3 753 290 3 558 788 3 557 646 3 374 766 3 323 485 2 891 094

2 330 498 2 160 830

2 070 000 1 421 266

1 399 826 1 366 140 1 318 930 1 310 962 1 174 300 1 061 869

1 028 006 945 276

47 811 537

59 151 801

10,00%6,51%6,35%6,02%6,01%5,71%

5,62%4,89%3,94%3,65%3,50%2,40%2,37%2,31%2,23%2,22%1,99%1,80%1,74%1,60%

80,83%

100.00%



114PAGE |

Shareholder spread

Director, employee and public shareholder analysis

Geographical spread of shareholders

Share trading statistics

SHAREHOLDER INFORMATION AT 30 APRIL 2013 (continued)

Percentageinterest

Percentageinterest

Percentageinterest

Share price at month endthebe

Number of shares held



Number of shares tradedMonth

Number of shareholdersRange

Number of shareholders

Number of shareholdersCountry

0 - 100 000100 001 - 250 000250 001 - 500 000500 001 - 750 000750 001 - 1 000 0001 000 001 - 2 000 0002 000 001 - 3 000 0003 000 001 - 5 000 0005 000 001 - 10 000 000

Directors of the company and its subsidiariesEmployees of the company and its subsidiariesPublic shareholders

Total

AustraliaBotswanaCanadaSwitzerlandGermanyFrance GuernseyIsle of ManJerseyMauritiusUnited KingdomUnited States of AmericaSouth AfricaZambiaZimbabwe

May 2012June 2012July 2012August 2012September 2012October 2012November 2012December 2012January 2013Februray 2013March 2013April 2013

Total shares traded

3192

1312221

61913915

260

560 812 3 406 986

10 000 1 567 002

5 000 1 040 091

4 400 498 3 421 192

2 160 830 14 625 239 14 748 727 3 453 590

9 156 221 34 188

561 425

59 151 801

- 3 584

96 795 -

55 926 -

1 586 - - - - -

157 891

0,95%5,76%0,02%2,65%0,01%1,76%7,44%5,78%3,65%

24,72%24,93%5,84%15,48%0,06%0,95%

100,00%

255255255255

260260249249249249249249

216127338461

260

2812

220

260

1 642 844 1 764 568

2 351 181 2 036 947 2 683 964 10 081 299

9 452 422 21 418 681 7 719 895

59 151 801

27 355 439489 780

31 306 582

59 151 801

2,78%2,98%3,97%3,44%4,54%

17,04%15,98%36,21%13,05%

100,00%

46,25%0,83%

52,93%

100,00%



115PAGE |

NOTICE OF ANNUAL GENERAL MEETING

Notice is hereby given that the eleventh Annual General Meeting of members of the Company will be held at the Lansmore Hotel, Masa Centre, Western Commercial Road, New Central Business District, Gaborone, Botswana on Tuesday, 22nd October 2013 at 0930 hours for the following purpose:

ORDINARY BUSINESS

1.

2.

3.

Approval of the Annual Financial StatementsOrdinary resolution 1:

To receive, consider and if deemed fit, approve and adopt the audited Annual Financial Statements of the Group and Company for the year ended 30 April 2013, together with the Report of the Independent Auditors thereon.

Election of directorsOrdinary resolution 2:

To elect Directors in place of those retiring in accordance with the provisions of the Company’s Constitution.

2.1 Mr Adam Fleming retires as a non-executive director in terms of Clause 20 of the Constitution. Being available and eligible, he offers himself for re-election. Full names: Adam Richard FLEMING Date of birth: 15th May 1948 Nationality: British Residential address: Swell Wold Farm, Stow on the Wold, Cheltenham Gloucestershire, GL 54 1 HE, United Kingdom Principal work experience: Investment banking and financial services Original date of appointment to the Board: 30 July 2003 2.2 Mr David Stone retires as an executive director in terms of Clause 20 of the Constitution. Being available and eligible, he offers himself for re-election.

Full names: David Eric STONE Date of birth: 3rd May 1954 Nationality: South African Residential address: Plot 61719, Extension 15, Ostrich Close, Village Gaborone. Botswana Principal work experience: Banking and financial services Original date of appointment to the Board: 27 July 2006 2.3 Mr Mark Tunmer retires as an executive director in terms of Clause 20 of the Constitution. Being available and eligible, he offers himself for re-election. Full names: Mark John Steele TUNMER Date of birth: 6th February 1957 Nationality: Zimbabwean Residential address: Plot 53660, Phakalane Golf Estate, Phakalane, Gaborone. Botswana Principal work experience: Stockbroking and financial services Original date of appointment to the Board: 6th November 2002

Extract from the Constitution of Imara Holdings Limited- Clause 20 – Election of directors:No resolution to appoint or elect a director shall be put to the holders of securities unless:

(a) the resolution is for the appointment of one director; or(b) the resolution is a single resolution for the appointment of two or more directors, and a separate resolution that it be so voted on, has first been approved without a vote being cast against it.

Directors’ remuneration- non-executiveOrdinary resolution 3:

To approve the remuneration of non-executive directors for the year ended 30 April 2013.

Non-executive directors’ remuneration for the year ended 30 April 2013 amounted to P1 460 123, (2012: P1 415 062), and is fully detailed in Note 15 to the Annual Financial Statements.



116PAGE |

Directors’ remuneration- executiveOrdinary resolution 4:

To approve the remuneration of executive directors for the year ended 30 April 2013 .

Executive directors’ remuneration for the year ended 30 April 2013 amounted to P13 232 107, (2012: P10 903 003), and is fully detailed in Note 15 to the Annual Financial Statements.

Auditor’s remunerationOrdinary resolution 5:

To approve the remuneration of the Independent Auditors for the year ended 30 April 2013.

Auditor’s remuneration for the year ended 30 April 2013 amounted to P2 941 090, (2012: P2 012 348). The components of the auditor’s remuneration are detailed in Note 4 to the Annual Financial Statements.

Appointment of independent auditorsOrdinary resolution 6:

To re-appoint Independent auditors for the ensuing year ending 30 April 2014.

Messrs Ernst & Young have indicated a willingness to continue as Independent Auditors to the Company for the ensuing year.

OTHER BUSINESS

To transact such other business as may be transacted at an Annual General Meeting.

VOTING AND PROXIES

A member entitled to attend and vote at the Annual General Meeting is entitled to appoint a proxy or proxies to attend, speak and vote in his / her stead. The proxy need not be a member of the Company.

The instrument appointing such a proxy must be deposited at the offices of the Company not later than 48 hours before the start of the meeting.

By Order of the Board

DE STONECompany Secretary3 September 2013

NOTICE OF ANNUAL GENERAL MEETING (continued)

4.

5.

6.

7.



118PAGE |

Signed at

Signature

Assisted by (if applicable)

on 2013

For use at the eleventh Annual General Meeting of members of the Company to be held at the Lansmore Hotel, Masa Centre, Western Commercial Road, New Central Business District on Tuesday, 22nd October 2013 at 0930 hours for the following purpose:

PLEASE READ THE NOTES HERETO BEFORE COMPLETING THIS FORM

I/We

NAME(S) IN BLOCK LETTERS

being the holder/holders of

in Imara Holdings Limited, do hereby appoint (see note 2 below)

1.

2.

3. the Chairman of the Annual General Meeting

as my/our proxy to act for me/us at the Annual General Meeting of the Company, to be held at Lansmore Hotel, Masa Centre, Western Commercial Road, New Central Business District on Tuesday, 22nd October 2013 at 0930 hours , or any adjournment thereof, for the purpose of considering and, if deemed fit, passing, with or without modification, the resolutions set out in the Notice of Annual General Meeting and to be proposed thereat, and to vote for and/or against the resolutions and/or abstain from voting in respect of the ordinary shares registered in my/our name/s (in accordance with the following instructions):

FORM OF PROXY

(Number of) ordinary shares

Ordinary resolution 1

Ordinary resolution 2.1







For Against Abstain

or failing him/her;

or failing him/her;

NOTES:

1.

2.

3.

4.

5.

6.

7.

Each ordinary shareholder is entitled to appoint one or more proxies (who need not be a member of the Company), to attend, speak and vote in place of that ordinary shareholder at the Annual General Meeting.

A shareholder may insert the name of a proxy or the names of two alternative proxies of the shareholder’s choice in the space provided, with or without deleting “the Chairman of the Annual General Meeting”, but such deletion must be initialled by the shareholder. The person who is to be present at the meeting and whose name appears first on the form of proxy and whose name has not been deleted shall be entitled to act as proxy to the exclusion of those whose names follow.

If the shareholder completing the proxy does not indicate how the proxy is to vote on any resolution, the proxy shall be deemed authorised and be entitled to vote on such resolution as he / she deem fit.

The authority of a person signing proxy under a power of attorney of a company must be attached to the proxy unless that authority has previously been recorded by the Company Secretary or is waived by the Chairman of the Annual General Meeting.

Forms of proxy must be lodged at or posted to the address of the company, to be received not later than 48 hours before the start of the meeting, as follows:Imara Holdings Limited, Unit 6, Second Floor, Morojwa Mews, Plot 74769, Western Commercial Road, New Central Business District, Gaborone,or Private Bag 00186 Gaborone.

The completion and lodging of this form of proxy shall not preclude the relevant shareholder from attending the Annual General Meeting and speaking and voting in person thereat, to the exclusion of any proxy form which is completed and / or received other than in accordance with these instructions, provided that he/she is satisfied as to the manner in which a shareholder wishes to vote.

Any alteration or correction to this form must be initialled by the signatory/signatories.

FORM OF PROXY

Imara Annual Report 2013 designed and typeset by Subtract BCA

Photography by Athol Moult and Teddy Shambu

Copywriting of “CSI Initiative” by Nicol Ritchie

Financial statements printed on Cyclus Offset uncoated paper. Cyclus Offset is 100% recycled and environmentally friendly.


Unit 6, Second Floor, Morojwa Mews,Plot 74769, Western Commercial Road, New CBDGaborone, Botswana

www.imara.com