Blue Label Telecoms Integrated Annual Report 2019

Blue Label annual financial statements 2019 19 The Committee is satisfied that it has exercised sufficient, ongoing oversight of compliance through: u u the appointment of a dedicated Compliance Officer for the Group; u u the approval of the compliance strategy; u u the approval of the regulatory compliance policy and the compliance process; u u annual review of the Company’s regulatory universe in order to prioritise regulatory compliance efforts; u u ongoing development and review of compliance risk management plans; u u continuous monitoring of the regulatory environment to ensure that the Group keeps abreast of matters affecting its regulatory environment; u u identification and monitoring of key compliance risks across the Group; and u u making use of a compliance maturity model to assess progress in the management of compliance. Expertise and experience of the Financial Director and finance function The Committee considered the appropriateness of the expertise and experience of the Financial Director and finance function in accordance with the JSE Listings Requirements and governance best practice. The ARCC concluded that the finance function is adequately resourced with technically competent individuals and is effective. The Committee confirms that it is satisfied that Dean Suntup possesses the appropriate expertise and experience to discharge his responsibilities as Financial Director. Annual financial statements The Committee has reviewed the accounting policies and financial statements of the Company and the Group and is satisfied that they are appropriate and comply with International Financial Reporting Standards, the JSE Listings Requirements and the requirements of the Act. The Committee has evaluated the Group annual financial statements of Blue Label Telecoms Limited for the year ended 31 May 2019 and based on the information provided to the Committee, the Committee recommends the adoption of the annual financial statements by the Board. The significant audit matters considered by the Committee were: 1. the impairment assessment of goodwill arising from business combinations; 2. the impairment assessment of the investment in BLM; 3. the impairment assessment of the investment in Oxigen, Oxigen Online and 2DFine; 4. the impairment assessment of the investment in Cell C Limited; 5. accounting for the bond notes and liquidity support; and 6. the fair value estimate of the Glocell loan. These matters were addressed as follows: The impairment assessment of goodwill arising from business combinations For the year ended 31 May 2019, management performed an impairment assessment over the goodwill balance as follows: u u assessing the recoverable amount as being value-in-use, as entities are held-for-trading and not for sale; u u calculating the value-in-use for each cash-generating unit (CGU) using a discounted cash flow model; and u u performing a sensitivity analysis over the value-in-use calculations, by varying the assumptions used (growth rates, terminal growth rate and WACC, i.e. discount rate) to assess the impact on the valuations.