Trade and other receivables

COMPANY       GROUP
2021 2020     (R’million) 2021 2020
      20 TRADE AND OTHER RECEIVABLES#    
      20.1 Analysis of trade and other receivables    
        Trade receivables 2 964,5 3 102,9
        VAT receivable 63,2 65,9
58,1 79,3     Sundry receivables 117,3 172,5
        Prepayments 183,8 229,9
        Pension fund contribution holiday (refer note 30) 39,9 75,9
1,0 2,1     Tax receivable 46,2 38,1
        Rebates receivable 4,4 3,8
59,1 81,4     Total gross receivables 3 419,3 3 689,0
(58,1) (77,7)     Expected credit loss (124,2) (186,0)
1,0 3,7     Total net receivables 3 295,1 3 503,0
        Trade receivables, which generally have 30 to 60-day terms, are non-interest-bearing and are recognised and carried at original invoice amount less an allowance for any uncollectible amounts. Included within sundry receivables is derivative assets of R3,2 million (2020: R3,0 million) which are carried at fair value, refer note 33.7 for further details.    
      20.2 Expected credit loss    
(77,7) (61,5)     Balance at the beginning of the year (186,0) (83,4)
    Utilised during the year 5,6 3,6
19,6     Reversed during the year 58,2 21,1
(16,2)     Raised during the year (2,0) (127,6)
    Transfer to assets held for sale (refer note 36) 0,3
(58,1) (77,7)     Balance at the end of the year* (124,2) (186,0)
# Restated as the group reclassified customer rebates as part of continuous improvements in terms of IFRS 15. (Refer note 21.1).
* The expected credit loss (ECL) results in the recognition of a loss allowance before the credit loss is incurred. Factors that are considered must account for current conditions along with reasonable and supportable forward-looking information that is not time consuming or costly to obtain. The company has adopted the “simplified approach” in determining the ECL.
20.2 Expected credit loss continued
 

Considering that IFRS 9 does not provide an explicit guide or any specific requirements we have opted to use a provision matrix approach to calculate the ECL. This involves allocating individual trade debtors into groups that share similar credit risk characteristics.

Customer’s risk rating was determined by applying the following criteria:

  • Historical data spanning three years which include payment history and behavioural trends
  • Economic environment that has a significant impact to each customer
  • Geographical location of the customer.

The percentage used to calculate the ECL for each risk segment was determined by:

  • Past three years specific impairment provisions
  • Past three years specific bad debts written off
  • Past three years trade credit insurance claims ratios
  • Management’s forward-looking analysis of the FMCG environment
  • An unbiased approach that involves evaluating a range of possible outcomes based on current economic trends.

The company makes use of selective trade credit insurance. For those debtors that are not insured, the full carrying value of the outstanding debt was included in the calculation of the ECL. For those debtors that are insured, only the uninsured portion of the debt was included in the calculation of the ECL.

A process of identifying specific impairments is included in the total impairment provision. Management will raise a specific impairment provision when all internal and or pre-legal efforts to collect overdue debt has been exhausted.

  Performing receivables    
(R’million) Low
risk
Medium
risk
Level 1
Medium
risk
Level 2
Medium
risk
Level 3
Defaulted
receivables
Total
As at 30 September 2021 1 833,0 380,8 376,8 346,3 27,6 2 964,5
Allowance for doubtful debts* (16,0) (4,6) (95,6) (27,6) (143,8)
Net amount 1 833,0 364,8 372,2 250,7 2 820,7
% risk mitigating factor (4,2%) (1,2%) (27,6%) (100%) (4,9%)
2020#            
As at 30 September 2020 1 812,3 410,0 391,5 470,0 19,1 3 102,9
Allowance for doubtful debts* (3,4) (4,9) (135,8) (19,1) (163,2)
Net amount 1 812,3 406,6 386,6 334,2 2 939,7
% risk mitigating factor (0,8%) (1,3%) (28,9%) (100%) (5,3%)
# Excludes allowance for doubtful debts reversal relating to sundry debtors of R19,6 million (2020: R22,8 million raised).
* Restated as the group reclassified customer rebates as part of continuous improvements in terms of IFRS 15. (Refer note 21.1).
COMPANY       GROUP
2021 2020     (R’million) 2021 Restated#
2020
      20.3 Past due analysis    
        As at 30 September, the ageing of trade receivables was as follows:    
        Not past due* 2 805,3 2 277,3
        Past due:    
        Current to 60 days 86,1 508,3
        61 to 90 days 18,8 68,3
        91 to 180 days 40,2 249,0
        > 180 days 14,1
        Total 2 964,5 3 102,9
        As at 30 September, the ageing of all other receivables, excluding tax receivable and prepayments was as follows:    
2,9 5,2     Not past due 69,6 25,0
        Past due:    
0,3     Current to 60 days 72,5 127,0
    61 to 90 days 0,4 131,0
7,2     91 to 180 days 7,1 0,8
48,0 73,8     > 180 days 75,2 34,3
58,1 79,3     Total 224,8 318,1
      20.4 Trade receivable analysis    
        Industry spread of trade receivables:    
        Retail 1 701,3 1 528,5
        Wholesale/Distributors 692,5 759,8
        Export 476,8 564,4
        Other 93,9 250,2
        Total 2 964,5 3 102,9
        Geographical spread of trade receivables:    
        South Africa 2 448,3 2 488,1
        Rest of Africa 411,7 465,2
        Europe 36,8 55,1
        Rest of the World 67,7 94,5
        Total 2 964,5 3 102,9
      20.5 Collateral held    
        Fair value of collateral held 52,6 34,1
        Collateral held represents hawker deposits which may be applied against accounts which are in default    
# Restated as the group reclassified customer rebates as part of continuous improvements in terms of IFRS 15. (Refer note 21.1).
* Debtors that are neither past due nor impaired are made up of customers with high credit ratings and with a sound payment history.