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DIRECTORS’ RESPONSIBILITY FOR FINANCIAL REPORTING FOR THE YEAR ENDED 31 DECEMBER 2011 DIRECTORS’ RESPONSIBILITY FOR FINANCIAL REPORTING The directors are responsible for: financial statements and related financial information of the Kumba Iron Ore Limited Group (the group) as well as Kumba Iron Ore Limited (Kumba or the company), in accordance with International Financial Reporting Standards and the requirements of The Companies Act and the Listings Requirements of the JSE Limited, which include amounts based on judgments and estimates made by management. The annual financial statements, set out on pages 13 to 81, are based on appropriate accounting policies which have been been consistently applied and which are supported by reasonable and prudent judgments and estimates, comprise the balance sheets at 31 December 2011; the income statements, the statements of comprehensive income, the statements of changes in equity and cash flow statements for the year then ended; the notes to the financial statements, which include a summary of principal accounting policies and other explanatory notes; and the directors’ report. The directors, primarily through the Audit Committee, meet periodically with the external and internal auditors as well as the executive management to evaluate matters concerning the responsibilities below: of risk management; internal control relevant to the preparation and fair presentation of these financial statements, that provides reasonable but not absolute assurance against material misstatement or loss, whether owing to fraud or error; circumstances; assets; and financial statements. The group’s internal auditors independently evaluate the internal controls and co-ordinate their audit coverage with the external auditors. The external and internal auditors have unrestricted access to all records, property and personnel as well as to the Audit Committee. The directors acknowledge that they are ultimately responsible for the process of risk management and the system of internal financial control established by the group and place a strong emphasis on maintaining a strong control environment. The directors are not aware of any material breakdown in the functioning of these controls and systems during the year under review. The directors are of the opinion, based on the information and explanations given by management, the internal auditors, the external auditors and the group’s risk, compliance and other reporting processes that the risk management processes and system of internal control provide reasonable assurance in all key material aspects that the financial records may be relied upon for the preparation of the annual financial statements. Having considered the group’s major risks, outstanding legal, insurance and taxation issues, an assessment of the solvency and liquidity taking into account the current financial position and existing borrowing facilities as well as the group’s financial budgets with their underlying business plans, the directors consider it appropriate that the annual financial statements be prepared on the going-concern basis. APPROVAL OF GROUP ANNUAL FINANCIAL STATEMENTS AND ANNUAL FINANCIAL STATEMENTS The group annual financial statements on pages 13 to 68, and 78 to 81; and the annual financial statements of Kumba Iron Ore Limited on pages 69 to 77, as identified in the first paragraph, were approved by the Kumba board of directors on 7 February 2012 and are subject to approval by the shareholders at the annual general meeting on 4 May 2012. The group and company annual financial statements are signed on the directors’ behalf by: The independent auditors are responsible for reporting on whether the group annual financial statements and the company annual financial statements are fairly presented in accordance with the applicable financial reporting framework. Their report to the members of the group and Kumba is set out on page 12 of this report. AJ Morgan Interim chairman 7 February 2012 CI Griffith Chief executive 10 Kumba Iron Ore Limited
CERTIFICATE OF THE COMPANY SECRETARY FOR THE YEAR ENDED 31 DECEMBER 2011 CERTIFICATE OF THE COMPANY SECRETARY I, VF Malie, in my capacity as company secretary, confirm that, for the year ended 31 December 2011, Kumba Iron Ore Limited has lodged with the Registrar of Companies all such returns and notices as are required of a public company in terms of the Companies Act 71 of 2008, as amended, and that all such returns and notices are true, correct and up to date. VF Malie Company secretary 7 February 2012 Approvals Annual financial statements 2011 11
Page 1 and 2: KUMBA IRON ORE ANNUAL FINANCIAL STA
Page 3 and 4: KUMBA AT A GLANCE BROAD AND MEANING
Page 5 and 6: INTEGRATED REPORTING THE INTEGRATED
Page 7 and 8: OPERATING PROFIT (R billion) CAGR:5
Page 9 and 10: 17 13 OPERATING EXPENDITURE Rand mi
Page 11 and 12: Net debt Kumba’s net cash positio
Page 13: productivity improvement project,
Page 17 and 18: DIRECTORS’ REPORT FOR THE YEAR EN
Page 19 and 20: SEGMENT RESULTS Refer to note 36,
Page 21 and 22: REPORT OF THE AUDIT COMMITTEE FOR T
Page 23 and 24: REMUNERATION REPORT FOR THE YEAR EN
Page 25 and 26: Both fixed and variable components
Page 27 and 28: Executive directors’ short-term i
Page 29 and 30: Long-term incentive schemes: intere
Page 31 and 32: PRINCIPAL ACCOUNTING POLICIES FOR T
Page 33 and 34: On disposal of part or all of the i
Page 35 and 36: The average LOM stripping ratio is
Page 37 and 38: The group’s criteria for a deriva
Page 39 and 40: The group recognises termination be
Page 41 and 42: 5.2 Waste stripping costs The rate
Page 43 and 44: GROUP INCOME STATEMENT/ STATEMENT O
Page 45 and 46: GROUP CASH FLOW STATEMENT FOR THE Y
Page 47 and 48: 1. PROPERTY, PLANT AND EQUIPMENT co
Page 49 and 50: 4. INVESTMENTS HELD BY ENVIRONMENTA
Page 51 and 52: 9. INTEREST-BEARING BORROWINGS Rand
Page 53 and 54: 10. PROVISIONS continued Change in
Page 55 and 56: 15. OPERATING EXPENSES Rand million
Page 57 and 58: 19. TAXATION Rand million 2011 2010
Page 59 and 60: 22. EQUITY-SETTLED SHARE-BASED PAYM
Page 61 and 62: 23. NON-CONTROLLING INTEREST Rand m
Page 63 and 64: 29. FINANCIAL INSTRUMENTS The group
Page 65 and 66:
29. FINANCIAL INSTRUMENTS continued
Page 67 and 68:
29. FINANCIAL INSTRUMENTS continued
Page 69 and 70:
32. COMMITMENTS Rand million 2011 2
Page 71 and 72:
35. RELATED PARTY TRANSACTIONS cont
Page 73 and 74:
COMPANY BALANCE SHEET AS AT 31 DECE
Page 75 and 76:
COMPANY CASH FLOW STATEMENT FOR THE
Page 77 and 78:
4. SHARE CAPITAL AND SHARE PREMIUM
Page 79 and 80:
11. RELATED PARTY TRANSACTIONS Duri
Page 81 and 82:
ANNEXURE 2: INVESTMENTS IN ASSOCIAT
Page 83 and 84:
LONG-TERM INCENTIVE PLAN continued
Page 85 and 86:
MANAGEMENT SHARE OPTION SCHEME cont
Page 87 and 88:
ANNEXURE 5: INCOME STATEMENT - US D
Page 89 and 90:
BREAKDOWN OF NON-PUBLIC HOLDINGS BR
Page 91 and 92:
NOTES Annual Financial Statements 2
Page 93:
4771/11
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