RAND WATER ANNUAL REPORT 2023

Consolidated Annual Financial Statements for the year ended 30 June 2023

Notes to the Consolidated Annual Financial Statements 17. Post retirement medical benefit (Continued)

Figures in Rand thousand

Group

Company

2023

2022 Restated *

2021 Restated *

2023

2022 Restated *

2021 Restated *

Health care cost inflation :

The post‑employment healthcare liability is linked to healthcare cost inflation or increases in medical scheme contribution amounts. Higher healthcare cost inflation than expected will lead to higher liabilities.

Salary variant risk:

The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan active members. As such, an increase in the salary of the plan participants will increase the plan’s liability.

Future changes in legislation: The passing of the National Health Insurance Bill in June 2023 and its expected implementation in the near future may lead to a requirement for the Employer to provide some level of compensation to eligible members or fund additional amounts into the system or may lead to private medical schemes redesigning their offering.

Changes in tax legislation affecting the subsidy may also pose a risk to both the employer and the recipients of the subsidy.

No other post‑retirement benefits are provided to these employees.

18. Deferred income

Non‑current and current portion of deferred income Current deferred income 2 707

2 740

2 740

2 707

2 740

2 740

Non‑current deferred income

129 391 134 865 138 755 129 016 133 539 136 279 132 098 137 605 141 495 131 723 136 279 139 019

Deferred income relates to the capital contributions received from customers for the construction of their assets, this also includes monies received from funders towards projects to be undertaken in future finacial periods. Deferred income is recognised in profit or loss within depreciation and amortisation expense on a straight‑line basis over the expected useful lives of the related assets.

Amortisation of the deferred income to the value of R4.6 million (2022: R2.7 million; 2021: R2.1 million) was recognised in other income when the asset is in use.

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