Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. These assets are included in current assets, except for maturities greater than 12 months after the statement of financial position date, which are classified as noncurrent assets. For details related to the ECLs refer to note 3.1.

Surety loans relate to the personal sureties that B Levy and M Levy signed for the loan owed by 2DFine Holdings Mauritius to Gold Label Investments Proprietary Limited. Their liability is limited to the difference between the loan owing to Gold Label Investments Proprietary Limited and the value of 16.95% of the shares in Oxigen Services India Private Limited (Oxigen Services) and 17.29% of the shares in Oxigen Online Services India Private Limited (Oxigen Online). In the current year this loan was impaired due to a decrease in the fair value of Oxigen Services and Oxigen Online resulting in the Group recognising a receivable on the potential surety claim.

All loans receivable are unsecured and repayable within five years. Interest-bearing loans bear interest at a range of between prime and prime plus 2%. The fair value of interest-free loans, which include loans to product distributors, approximates their carrying value. This has been corroborated through discounted cash flow calculations at the effective interest rate the lender would have been able to secure from a financing institution, using an expected payment timeframe.

Trade receivables comprise receivables that are due from customers which arise from transactions for the sale of goods, rendering of services and leasing of equipment in the ordinary course of business. Trade receivables are primarily accounted for at amortised cost, in accordance with the accounting policies of the Group. Sundry receivables are accounted for at amortised cost in accordance with the accounting policies of the Group. For details related to the ECLs refer to note 3.1. Receivables for prepayments and VAT are stated at their nominal values.

The following table provides an analysis of the Group’s trade and other receivables, including an analysis of trade receivables by originating transaction type as well as by counterparty:

Amounts due from customers arising from the provision of financing and not the sale of a product of service have been reclassified to advances to customers as it more appropriately reflects that the end customer. Refer to note 3.5.3.

Included in trade receivables are debtors of R208 million (2018: R271 million) which have a cycle period in excess of 12 months but are considered current.

The Group held guarantees to the value of R30 million in the prior year as security over specific customers included in trade receivables. The Group has further insurance cover to the value of R10 million (2018: R245 million) over trade receivable balances with certain material customers. All insured values exclude VAT.

There is a cession of trade receivables (including intergroup balances) of R3.563 billion (2018: R3.210 billion) in favour of Investec Bank Limited as security for facilities referred to in note 3.2.

Advances to customers comprise receivables arising on financing transactions where, in substance, the nature of the business activities undertaken by certain subsidiaries of the Group is to engage in the provision of financing. Refer to note 3.1 for further detail.

Advances to customers are primarily accounted for at amortised cost, in accordance with the accounting policies of the Group.

Cell C guarantees bad debts and cancellations of these customers in terms of the “Amended and Restated Product Procurement and Financing Agreement”. At 31 May 2019, bad debts and cancellations amount to R210 million (2018: R221 million). In terms of the above agreement, if Cell C is unable or admits inability to make a payment as it falls due, or is deemed to or declared to be unable to pay its debts under the applicable law, suspends or threatens to suspend making payments by reason of actual or anticipated financial difficulties, they would be in breach of their agreement. If not remedied, CEC ultimately has a right to port the Cell C base.

Cash and cash equivalents include cash on hand and deposits held on call with banks.

Included in this balance is restricted cash of R16.6 million (2018: R8.4 million), received on behalf of and immediately due to third parties, that may not be utilised in the Group’s ordinary course of business.