Telkom AR front.qxp

268
Telkom Annual Report 2009
Notes to the annual financial statements (continued)
for the three years ended March 31, 2009
5. OPERATING EXPENSES (continued)
2007 2008 2009
Rm Rm Rm
5.4 Service fees 2,236 2,410 2,760
Facilities and property management 1,140 1,221 1,261
Consultancy services 209 160 324
Security and other 833 978 1,122
Auditors’ remuneration 54 51 53
Audit services 53 51 50
Company auditors 47 46 46
Current year 47 43 46
Prior year underprovision – 3 –
Other auditors – current year 6 5 4
Other services 1 – 3
Included in the current year’s consultancy services is an amount
of R177 million relating to services rendered in respect of the
transaction to dispose of the Company’s stake in Vodacom
Group (Proprietary) Limited.
The increase in the current year’s security and other costs is mainly
attributable to the new contract negotiated to secure the copper
network in the Company’s drive to cutting down on cable thefts.
5.5 Operating leases 762 619 613
Land and buildings 131 142 166
Equipment 79 49 58
Vehicles 552 428 389
5.6 Depreciation, amortisation and write-offs 3,583 3,732 4,358
Depreciation of property, plant and equipment (refer to note 9) 2,994 3,062 3,398
Amortisation of intangible assets (refer to note 10) 305 408 638
Write-offs of property, plant and equipment and intangible assets 284 262 322
Included in the current year’s amortisation of intangible assets is an
amount of R134 million relating to the FIFA brand intangible asset.
In recognition of the changed usage patterns of certain items of property,
plant and equipment and intangible assets, the Company revised their
remaining useful lives as at March 31. The assets affected were
individual items of Network equipment, Data processing equipment,
Support equipment, Freehold land and buildings and Intangible assets.
The revised estimated useful lives of these assets as set out below,
resulted in a decrease of the current year depreciation and amortisation
charges of R11,4 million (2008: R196 million; 2007: R942 million).
Previous life Revised life
Years Years
Property, plant and equipment
Other 2 – 15 2 – 20