AVBOB Financial Statements 2018

97 AVBOB MUTUAL ASSURANCE SOCIETY AND ITS SUBSIDIARIES NOTES TO THE SUMMARISED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018 1. General information 2. Basis of preparation 3. Accounting policies 4. Critical accounting estimates and judgements 4.1 Policyholder liabilities 4.2 Other assumptions and estimates - Provision for deaths not yet reported - Valuation of investment property - Valuation of subsidiaries - Employee benefit obligations - Assets at fair value through profit and loss with unobservable inputs - Deferred tax asset. The Group has applied the provisions of the Companies Act no 71 of 2008, which allows for summarised financial results as disclosed in this report. The summarised financial statements should be read in conjunction with the annual financial statements for the year ended 30 June 2018, which have been prepared in accordance with the framework concepts and the measurement and recognition requirements of International Financial Reporting Standards (IFRS), IAS 34 Interim financial statements and the requirements of the Companies Act of South Africa as applicable to summary financial statements. The Society is a funeral assurance provider and the subsidiaries manufacture, distribute and sell funeralware and conducts funerals. The Group has a manufacturing plant in Bloemfontein and conducts business in South Africa and Namibia. These summarised financial statements have been audited. The accounting policies adopted are consistent with those of the previous financial year. The complete accounting policies are not disclosed in the summarised financial statements and should be read in conjunction with the annual financial statements for the year ended 30 June 2018. There are a number of amendments, interpretations and improvements to standards that are mandatory for the Group in 2018. The adoption of these standards have resulted in some additional disclosure contained in the annual financial statements for the year. The Group has not early adopted any of the standards or interpretations applicable to the Group's 2019 financial reporting period or later financial periods. The application of these standards and interpretations to the 2019 financial reporting period is not expected to have a significant impact except for IFRS 9,15,16 and 17 where the Group is evaluating the impact on the Group's reported results, financial position and cash flows. The value of the policyholder liabilities is based on estimates that are in turn based on assumptions. The assumptions represent best estimates of the expected future experience and are based on actual experience and reasonable expectations of what may happen in future. The future experience will probably differ from these assumptions, which may in turn require the value of policyholder liabilities to be adjusted. The full details of these valuation assumptions for estimates are set out in note 13 of the notes to the summarised financial statements for the year ended 30 June 2018. The Group makes estimates and assumptions in respect of assets and liabilities. Estimates and assumptions are re- evaluated on an on-going basis, based on historic experience and other factors, including expectations with regard to future events that are deemed reasonable under the circumstances. Actual results may differ from these estimates. Other assumptions and estimates included in the annual financial statements for the year ended 30 June 2018 addresses the following items: 97