| 1. |
CORPORATE INFORMATION |
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Telkom SA Limited (‘Telkom’) is a limited liability company incorporated and domiciled in the Republic of South
Africa (‘South Africa’) whose shares are publicly traded. The company, its subsidiaries and joint ventures
(‘the Group’) is the leading provider of fixed-line voice and data communications services in South Africa and
mobile communications services through the Vodacom Group (Proprietary) Limited (‘Vodacom’) in South Africa
and certain other African countries. The Group’s services and products include: |
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fixed-line voice services, including subscriptions and connections services, local, long distance, fixed-tomobile
and international voice services, interconnection and hubbing communications services, international
voice-over-internet protocol services, subscription based value-added voice services and customer premises
equipment sales and rental; |
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fixed-line data services, including domestic and international data transmission services, such as point-topoint
leased lines, ADSL services and packet-based services, managed data networking services and internet
access and related information technology services; |
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directory and wireless data services through our TDS Directory Operations and Swiftnet subsidiaries,
respectively; and |
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mobile communications services, including voice services, data services, value-added services and handset
sales through Vodacom. |
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The condensed consolidated interim financial statements of the Group for the six months ended September 30,
2006 were authorised for issue in accordance with a resolution of the directors on November 9, 2006. |
| 2. |
BASIS OF PREPARATION AND ACCOUNTING POLICIES |
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Basis of preparation |
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The condensed consolidated interim financial statements have been prepared in accordance with IAS34 Interim
Financial Reporting and in compliance with the South African Companies Act, 1973. The condensed
consolidated interim financial statements are prepared on the historical cost basis, with the exception of certain
financial instruments and share-based payments which are measured at fair value. The results of the interim
period are not necessarily indicative of the results for the entire year, and these reviewed financial statements
should be read in conjunction with the audited financial statements for the year ended March 31, 2006. |
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The preparation of condensed consolidated interim financial statements requires the use of estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the condensed consolidated interim financial statements and the reported amounts of
revenue and expenses during the reporting periods. Although these estimates are based on management’s best
knowledge of current events and actions that the Group may undertake in the future, actual results may differ
from those estimates. |
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Significant accounting policies |
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The accounting policies and methods of computation followed for presenting the condensed consolidated
interim financial statements are consistent with those applied in the financial statements for the year ended
March 31, 2006, except that the Group has adopted the amendments to IAS21 (revised) and IAS39 (revised),
and IFRIC4 and IFRIC7 with effect from April 1, 2006. The Group has also adopted an accounting policy
regarding the acquisition of minority interests in subsidiary companies in terms of IAS8. |
