ECIC IR 2023

ANNUAL Financial Statements for the year ended 31 March 2023

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2

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1

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E X P O R T C R E

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C

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Notes to the Financial Statements

16. Trade and other payables

2023 R’000 13 746 297 250

2022 R’000 14 549 112 810

Sundry creditors and accruals

Unsettled investment trades and accrued expenses

Reinsurance premium payables

1 090 2 065

1 082

VAT

615

314 151 129 056 Included in the trade and other payables balance is unsettled investment trades and foreign exchange movements and other non-cash adjustments of R298 million (2022: R113 million) which have been adjusted for in note 28.

17. Lease liability Lease liability

During the year, the Corporation had leases for office building and printers which are reflected on the balance sheet as a right of use asset and a lease liability. The Corporation classifies its right‑of‑use assets in a consistent manner to its property and equipment, see note 7. The Corporation is prohibited from sub‑leasing, selling, or pledging the underlying leased assets as security. For leases over office buildings, the Corporation must keep those properties in a good state of repair and return the properties in their original condition at the end of the lease. The lease agreement does allow for cancellation or renewal; however, the Corporation has no intention of exercising these options. For other leases, the Corporation must ensure that the lease items are used in accordance with the lease contracts. The Corporation shall have the right to terminate the lease on or after expiry of a lease‑term by providing one calendar month notice. The lease agreement shall not be extended without mutual agreement by the Corporation and the lessor. In the event that the lease is terminated by the Corporation prior to the expiry of the lease term, then the Corporation shall be obliged to pay a settlement amount in respect of the unexpired lease‑term. The lease contract for the printers expired during the financial year. The right of use asset and the related lease liability was derecognised on expiry of the lease contract. The Corporation entered into the five years office building lease contract commencing from November 2022 to November 2027. Prior to procuring this lease for the office building, the Corporation had entered into a short‑term lease agreement which expired in November 2022 and has been accounted for as an operating lease (see note 23). It is not probable that the option to renew the leases will be exercised and as such these were not taken into account when the lease terms were determined. The average effective incremental borrowing rate is 9.07%. There was a modification on the lease payments for the office building; however, this has no impact on the original lease term.

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