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CSIR ANNUAL REPORT 2010/11
Notes to the Annual Financial Statements
for the year ended 31 March 2011
1PRINCIPAL ACCOUNTING
POLICIES
The CSIR is a parastatal (enacted
by The Scientifi c Research Council
Act, Act 46 of 1988) domiciled in
the Republic of South Africa. The
address of the CSIR’s principal place
of business is Meiring Naudé Road,
Brummeria, Pretoria.
The consolidated Annual Financial
Statements are prepared on the
historical cost basis except for
fi nancial instruments held for trading
and fi nancial instruments classifi ed
as available-for-sale, which are
stated at fair value. The consolidated
Annual Financial Statements have
been prepared in accordance with
statements of South African Generally
Accepted Accounting Practice (SA
GAAP) and the Public Finance
Management Act, Act 1 of 1999 as
amended by Act 29 of 1999. The
following principal accounting policies
have been consistently applied by
group entities in all material respects.
The preparation of fi nancial
statements requires management to
make judgements, estimates and
assumptions that affect the application
of policies and reported amounts
of assets and liabilities, income
and expenses. The estimates and
associated assumptions are based
on historical experience and various
other factors that are believed to be
reasonable under the circumstances,
the result of which forms the basis of
making judgements about carrying
values of assets and liabilities that
are not readily apparent from other
sources. Actual results may differ from
these estimates.
Estimates and underlying assumptions
are reviewed on an ongoing basis.
Revisions to accounting estimates are
recognised in the period in which the
estimate is revised and in any future
periods affected.
The consolidated Annual Financial
Statements are presented in South
African rand (R), which is the CSIR’s
functional currency, and are rounded
off to the nearest thousand.
Basis of consolidation
Interest in subsidiaries
The consolidated Annual Financial
Statements incorporate the Annual
Financial Statements of the CSIR and
the Annual Financial Statements of
the entities under its control from the
date that control commences until
the date that control ceases. Control
exists when the CSIR has the power
to govern the fi nancial and operating
policies of an investee entity so as
to obtain benefi ts from its activities.
In assessing control, potential voting
rights that are presently exercisable
are taken into account.
On acquisition, the assets and
liabilities of the relevant subsidiaries
are measured at their fair values at the
date of acquisition. Non-controlling
interests are stated at the noncontrolling
interests’ proportion of the
fair values of the assets and liabilities
recognised. The operating results of
subsidiaries acquired or disposed
of during the reporting period are
included in the consolidated statement
of comprehensive income from the
effective date of acquisition up to
the effective date of disposal. All
signifi cant intercompany balances
between group entities are eliminated
on consolidation.
Where a group enterprise transacts
with a subsidiary company, unrealised
gains and losses are eliminated in
preparing the consolidated fi nancial
statements.
Any excess of net assets of a
subsidiary over the cost of an
acquisition is treated in terms of
the Group’s accounting policy on
goodwill.
Investments in subsidiaries are
measured at cost less accumulated
impairment losses in the CSIR’s Annual
Financial Statements.
Interest in associates
An associate is an entity over which
the Group is in a position to exercise
signifi cant infl uence, but not control,
through participation in the fi nancial
and operating policy decisions of
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