NOTES

1. Net financial expenditure	2006 R'000	2005 R'000
Net financial income/(expenses) consist mainly of the following principal categories:
Interest received	4 744	7 545
Interest paid	(8 730)	(11 916)
Net foreign exchange profit	162	7 317
Rehabilitation provision – unwinding of discount	(757)	3 936
	(4 581)	6 882

2. Impairment of assets

In light of the lower than anticipated exploration results, the group has reviewed the value of its investments in the Cacolo and Cacuilo alluvial and kimberlite exploration projects in Angola and the Tirisano Mine. This review has indicated impairment to the value of these investments as well as the Middle Orange operations and in accordance with the provisions of IAS 36, the value of these investments has been reduced as follows:

Details of net assets impaired are as follows:

Mining plant and equipment
Mining rights
Net current assets
Impairment of assets before tax
Deferred taxation
Net assets impaired

22 418
190 205
6 169
218 792
(68 843)
149 949

-
-
-
-
-
-


3. Segment information
Primary segments
3.1
2006	RSA Land	Angola	Marine	Unallo-cated	Total
	R’000	R’000	R’000	R’000	R’000

Revenue	908 388	87 592	91 917	-	1 087 897

Operating income	315 364	(11 785)	(17 184)	2 974	289 369
Depreciation	94 871	26 167	8 930	2 974	132 942
Mining income	220 493	(37 952)	(26 114)	-	156 427
Net financial income	-	(1 513)	-	(3 068)	(4 581)
Exploration costs	(19 293)	(44 358)	-	-	(63 651)
Impairment of assets	(73 501)	(145 291)	-	-	(218 792)
Share of associates’ results	(6)	-	-	-	(6)
Profit/(loss) before income tax	127 693	(229 114)	(26 114)	(3 068)	(130 603)

Assets	610 953	378 594	162 647	206 304	1 358 498
Liabilities	252 904	41 889	30 652	73 326	398 771
Capital expenditure	86 925	34 484	386	-	121 795

3.2	RSA Land	Angola	Marine	Unallocated	Total
2005	R’000	R’000	R’000	R’000	R’000

Revenue	816 033	74 770	123 995	-	1 014 798

Operating income	370 975	2 782	(2 415)	2 822	374 164
Depreciation	97 410	24 469	12 802	2 822	137 503
Mining income	273 565	(21 687)	(15 217)	-	236 661
Net financial expense	-	-	-	6 882	6 882
Exploration costs	(11 747)	(52 152)	(3 407)	-	(67 306)
Share of associates’ results	(5)	-	-	-	(5)
Profit/(loss) before income tax	261 813	(73 839)	(18 624)	6 882	176 232

Assets	838 697	474 349	175 321	127 595	1 615 962
Liabilities	280 070	107 799	12 426	101 784	502 079
Capital expenditure	34 396	100 212	579	4 819	140 006

	2006 R’000	2005 R’000
4. Capital commitments (including amounts authorised, but not yet contracted)	44 421	54 373

These commitments of the group will be financed from its own resources or borrowed funds.

5. The accounting policies are consistent with the Annual Report and the corresponding prior year period in accordance with International Financial Reporting Standards, except for the adoption of IFRS 2 Share-based payments and the revised IAS 16 Property, plant and equipment. The impact of other changes resulting from the IASB’s accounting standards improvement project is not material.

6. NEW ACCOUNTING POLICIES ADOPTED IFRS 2 – Share-based payments The group has adopted the requirements of IFRS 2 Share-based payments which resulted in a change in the accounting policy for share-based payments. Previously the provision of share options to employees did not result in a charge to the income statement. The group now charges the cost of share options to the income statement, with a corresponding credit to equity. The impact of this adjustment on profits is a charge of R1,1 million (2005: charge of R1,6 million). IAS 16 – Property, plant and equipment The adoption of the revised IAS 16 resulted in a change in the accounting policy relating to: The frequency of determination and measurement of residual value of assets; and The inclusion in IAS 16 of property, plant and equipment used to develop or maintain mining rights and the activities of exploration and extraction which are not separable from the mining activities. The impact of this adjustment on profits for previous years amount to R12,8 million.

7. Report of independent auditor. The results have been audited by PricewaterhouseCoopers Inc. (Stellenbosch). A copy of their unqualified report is available for inspection at the Company’s registered office.