4.0 - Imperial

39. Financial instruments (continued)
Credit risk (continued)
Financial Statements
Past due trade receivables
Included in trade receivables are debtors which are past the original expected collection date (past due) at the reporting date. There
has not, however, been a significant change in credit quality and the amounts are still considered recoverable. Those which are
not considered to be recoverable have been included in the provision for doubtful debts below. A summarised age analysis of past
debtors is set out below.
2009 2008
Rm
Rm
Less than 1 month 924 761
Between 1 – 3 months 323 341
More than 3 months 117 138
Past due more than 1 year 39 39
1 403 1 279
The overdue debtor ageing profile above is considered typical of the various industries in which our businesses operate. Given the
existing insurance cover and the nature of the related counterparties, these amounts are considered recoverable.
Provision for doubtful debts for trade receivables
Before these financial instruments can be impaired, they are evaluated for the possibility of any recovery, which includes an
examination of the length of time they have been outstanding. Provision is made for bad debts on trade accounts receivable.
Management does not consider that there is any material credit risk exposure not already covered by a bad debt provision.
There is no significant concentration of risk in respect of any particular customer or industry segment.
2009 2008
Provision for doubtful debts for trade receivables Rm Rm
Set out below is a summary of the movement in the provision for doubtful
debts for the year:
Balance at beginning of year 240 328
Reclassified from (to) discontinued operations, subsidiaries sold and unbundled 6 (146)
Amounts reversed during the year (2) (6)
Increase in allowance recognised in profit or loss 98 62
Amounts written off during the year (24) 2
Balance at end of year 318 240
Loans receivable
The group granted employees the right to purchase shares through a share incentive trust. The terms held that the company would
lend these employees the funds to acquire shares in Imperial Holdings Limited, holding the shares as collateral for the debt.
Due to share price depreciation, an impairment has been made. An additional impairment loss to the amount of R53 million
(2008: R320 million) has been raised, resulting in R53 million (2008: R54 million) of interest not being recognised. The balance of the
2008 impairment, being R260 million, was charged to the income statement in both continuing and discontinued operations.
There are no amounts which are past due.
2009 2008
Allowance for impairment losses on share incentive trust receivable Rm Rm
Set out below is a summary of the movement in the allowance for impairment
losses for the year:
Balance at beginning of year 321 1
Increase in allowance recognised in profit or loss 53 320
Balance at end of year 374 321
Imperial holdings limited Annual Report 2009 117