9. Equity structure
9.3 Non-distributable reserves
 

Summary of material accounting policies

Non-distributable reserves

Non-distributable reserves include reserves that have been grouped together as these are accounting reserves, which have arisen as a result of the specific requirements in the accounting standards.

Non-distributable reserves include the following:

  • Translation reserve: comprises foreign currency translation differences arising from the translation of financial statements of the Group's foreign entities into South African rand;
  • Treasury shares: the reserve also represents the treasury shares as well as amounts paid by Telkom to its subsidiary, Rossal No 65 (Pty) Ltd, for the acquisition of Telkom's shares to be utilised in terms of the Telkom share scheme; and
  • Shares repurchased for the purpose of the Telkom Group employee share scheme.

Treasury shares

Where the Group acquires shares for purposes of its employee share scheme, such shares are measured at acquisition cost and disclosed as a reduction of equity. No gain or loss is recognised in profit or loss on the purchase, sale, issue or cancellation of the Group's own equity instruments. Such shares are not remeasured for changes in fair value. Any difference between the historical par value of the shares acquired and the consideration transferred for the acquisition of the shares is accounted for as an adjustment to retained earnings.

Where the Group chooses or is required to buy equity instruments from another party to satisfy its obligations to its employees under the sharebased payment arrangement by delivery of its own shares, the transaction is accounted for as equity-settled. This applies regardless of whether the employees' rights to the equity instruments were granted by the Group itself, or by its shareholders, or were settled by the Group itself or its shareholders.

Group Company
31 March 
2024 
Rm 
31 March 
2023 
Rm 
31 March 
2024 
Rm 
31 March 
2023 
Rm 
Non-distributable reserves  750  739  278  278 
Opening balance  739  968  278  526 
Movement during the year  11  (229)   (248)
  Increase in foreign currency translation reserve  11  17    – 
  Movement in treasury shares for Telkom and subsidiaries share scheme    (250)   (250)
  Take-on of Trudon (Pty) Ltd share reserve    (5)   (5)
  Vesting of shares under Telkom Group share scheme      – 
  Insurance service result     
  Revaluation of the first-party cell captive     

The reserve also represents amounts paid by Telkom to subsidiary, Rossal No 65 (Pty) Ltd, for the acquisition of Telkom's shares to be utilised in terms of the Telkom Group share scheme.

  2024 2023
Fair value of ordinary shares in Telkom are held as follows: Number of
shares
 Rm Number of
shares
 Rm
Treasury shares in Escrow 17 008 725 510 24 025 672 858
Rossal No 65 (Pty) Ltd 5 166 604 155 2 838 959 102
Total 22 175 329 665 26 864 631 960

All shares will be allocated to employees as part of the share scheme.