NOTES TO THE CONSOLIDATED ANNUAL FINANCIAL STATEMENTS l NOTE 18
    2014
Rm		     Restated
2013
Rm		  
18. Other reserves          
  Share-based payment reserve (for details about the Group’s share schemes refer note 18.2) (208)     (267)  
  Hedge accounting reserve (68)     317  
  Statutory reserve 183     173  
  Foreign currency translation reserve (refer note 18.1) 1 470     951  
  Premium paid on purchase of non-controlling interests (refer note 18.3) (364)     (157)  
  Valuation reserve 44     6  
  Changes in net assets of associates and joint ventures 92        
    1 149     1 023  
  The movements for other reserves are shown in the statement of changes in equity.          
  18.1 Foreign currency translation reserve          
    Balance at beginning of year 951     259  
    Goodwill and intangible assets 346     674  
    Investments, loans, other financial assets, associates and joint ventures 83     83  
    Property, plant and equipment 359     508  
    Transport fleet 180     268  
    Deferred tax (14)     (41)  
    Inventories 204     167  
    Current tax 5     (15)  
    Trade and other receivables 389     679  
    Cash resources 45     209  
    Non-controlling interests (14)     (30)  
    Retirement benefit obligations (114)     (159)  
    Interest-bearing borrowings (487)     (857)  
    Insurance, investment, maintenance and warranty contracts (6)     (10)  
    Other financial liabilities (2)     (29)  
    Provisions for liabilities and charges (55)     (95)  
    Trade and other payables (400)     (660)  
    Balance at end of year 1 470     951  
  18.2 Share-based payment reserves
    The following details applies to the Group’s share schemes.          
      Number of rights  
    Total rights authorised and currently allocated in terms of group share schemes 2014     2013  
    Share Appreciation Rights Scheme 10 925 436     11 216 355  
    Deferred Bonus Plan 305 495     119 363  
    Total rights currently allocated in terms of group share schemes 11 230 931     11 335 718  
      2014     2013  
    Share scheme details are as follows: Number of
rights		 Weighted
average
exercise price
(Rand)		     Number of
rights		 Weighted
average
exercise price
(Rand)		  
    Share Appreciation Rights Scheme              
    Rights granted at beginning of year 11 216 355 148,05     11 631 363 102,01  
    Rights allocated during the year 3 197 046 193,77     3 933 387 195,20  
    Rights exercised during the year (2 685 895) 84,46     (3 900 620) 55,32  
    Rights forfeited during the year (802 070) 161,64     (447 775) 127,96  
    Unexercised rights at end of year 10 925 436 176,38     11 216 355 148,05  

      Number of rights  
    Share scheme details are as follows: 2014     2013  
    Deferred Bonus Plan          
    Rights granted at beginning of year 119 363     111 930  
    Rights taken up during the year (99 539)     (111 930)  
    Rights forfeited during the year (19 824)        
    Prior year rights carried forward          
    Rights allocated during the year 305 495     119 363  
    Unexercised rights at end of year 305 495     119 363  

    Share Appreciation Rights Scheme – details of rights by year of grant Number of
rights		 Average
exercise price
(Rand)		 Expiry
date		  
    Grant date        
    June 2008 49 373 49,46 May 2015  
    June 2009 92 485 55,32 June 2016  
    June 2010 269 862 96,71 June 2017  
    June 2011 1 195 202 116,59 June 2018  
    June 2012 2 458 786 170,57 June 2019  
    June 2013 3 662 682 195,20 June 2020  
    June 2014 3 197 046 193,77 June 2021  
    Total unexercised rights at end of year 10 925 436      
    Total weighted average price   176,38    

    Upon exercise by participants the Group will settle the value of the difference between the exercise and grant price by delivering shares, alternatively as a fall back provision only by settling the value in cash.

The company purchased 2 123 775 ordinary shares in 2010 as a hedge against the company’s obligation to deliver shares in terms of the Share Appreciation Rights Scheme and Deferred Bonus Plan (Share Schemes). In 2013, upon vesting of the 2009 allocation of the Share Appreciation Rights in terms of the rules of the Share Schemes, shares repurchased were issued for settlement of the company’s obligations. Based on prior years’ vesting experience, hedges have been purchased to cover the anticipated number of share appreciation rights that will convert.

    Deferred Bonus Plan - details of rights still unexercised by year of grant# Number
of rights		 Expiry
date		  
    Grant date      
    June 2014 305 495 September 2017  
    Total unexercised rights at end of year 305 495    
    Deferred Bonus Plan - details of rights taken up and not vested# Number
of rights		 Expiry
date		  
    Rights taken up      
    September 2011 123 542 September 2014  
    September 2012 96 116 September 2015  
    September 2013 88 276 September 2016  
    June 2014 60 787 June 2017  
    # Rights entitle participants to invest a portion of their after-tax bonus in Imperial shares, which, if held for three years, will be matched by the company on a one-for-one basis by the allocation of an equal number of Imperial shares for no consideration.

The fair values for the share-based payment reserve is calculated using a Black-Scholes pricing model.

The inputs into the model established at the grant dates and which have not changed were as follows:

      2014     2013 2012 2011  
    Share Appreciation Rights Scheme              
    Volatility (%) 28,41     29,50 30,80 33,30  
    Weighted average share price (Rand) 193,77     195,20 170,57 116,59  
    Weighted average exercise price (Rand) 193,77     195,20 170,57 116,59  
    Weighted average fair value (Rand) 46,67     47,02 43,24 36,14  
    Expected life (years) 4,28     4,32 4,26 3,24  
    Average risk-free rate (%) 7,75     6,50 5,85 7,13  
    Expected dividend yield (%) 4,34     3,89 3,28 3,60  
    Deferred Bonus Plan              
    Volatility (%) 28,41     29,50 30,80 33,30  
    Weighted average share price (Rand) 193,77     195,20 170,57 116,59  
    Weighted average fair value (Rand) 168,45     171,89 153,56 103,17  
    Expected life (years) 3,23     3,27 3,20 3,24  
    Average risk-free rate (%) 7,75     6,50 5,85 7,13  
    Expected dividend yield (%) 4,34     3,89 3,28 3,60  

    The volatilities were determined by calculating the historical volatility of the company’s share price over the previous five years. The expected life is determined by the rules of the schemes which dictate the final expiry date.

The current year’s share based payment expense charged to profit or loss amounted to R104 million. A current income tax benefit of R10 million was recognised directly in equity.
  18.3 Premium paid on purchase of non-controlling interests
    The effects of changes in the Group’s ownership interest in subsidiaries that did not result in a loss of control during the year were as follows:

    R million Decrease
in equity
attributable
to owners
of Imperial		 Increase
(decrease) in
non-controlling
interests		 Consideration
amount		  
    In May 2014 the Group acquired a further 15% ownership interest from a non-controlling shareholder of Eco Health Limited thereby increasing its interest from 53% to 68%. The transaction resulted in a decrease in the put option liability of R289 million with a corresponding entry to equity. (176) (97) 273  
    Aggregate of immaterial transactions (49) 1 48  
    2014 (225) (96) 321  
    The effects of changes in the Group’s ownership interest in subsidiaries that did not result in a loss of control during the prior year were as follows:        
    Aggregate of immaterial transactions (11) 2 9  
    2013 (11) 2 9