Notes to the company financial statements

FOR THE YEAR ENDED 30 SEPTEMBER

		2020 Rm	2019 Rm
8	LOANS OWING FROM/(TO) SUBSIDIARIES
	Long-term loans	9 343	7 045
	Short-term loans	403	2 927

	Amounts owing from subsidiaries *	9 746	9 972

	Amounts owing to subsidiaries **	(273)	(168)

	*	The interest bearing loans are payable on demand, with the interest rate calculated using the weighted average cost of external borrowings for Barloworld Treasury plus a margin of 0.25%. Non-interest bearing loans are not payable on demand but are long-term. The interest bearing loans are payable on demand, with the interest rate calculated using the weighted average cost of external borrowings for Barloworld Treasury plus a margin of 0.25%. During the current financial year the Khula Sizwe Management trust was provided a R198 million interest free loan. Non-interest bearing loans are not payable on demand but are long-term. There is no history of credit losses on loans to subsidiaries and management expect these loans to continue performing, and therefore, no expected credit losses have been recognised on these loans. Management have also considered macro-economic forward looking factors relating to these loans, however the ECL remains negligible and as such none has been recognised.
	**	The R273 million owing to subsidiaries is made up mainly of various group equity loans which are interest free with no fixed repayment terms.

Expected credit losses are determined in line with the group’s accounting policy included in the group annual financial statements.