Notes to the annual financial statements

for the year ended 31 December 2006


« Note 1 (accounting policies)			Note 3 (revenue) »

			Group		Company
				Restated		Restated
			2006	2005	2006	2005
		Notes	Rm	Rm	Rm	Rm
2.	CHANGES in ACCOUNTING POLICY
	Accounting for arrangements that contain a lease In terms of IFRIC 4 (Determining whether an arrangement contains a lease) and IAS 17 (Leases), arrangements that convey the right to use an asset, are evaluated for recognition, classification as a finance or operating lease and measured and accounted for accordingly. The result is the recognition of a number of finance leases where Exxaro is either the lessee or the lessor.
	Income statement impact
	(Decrease) in revenue		(89)	(81)
	Decrease in depreciation		79	72
	Decrease in operating expenses		47	42
	(Increase) in financing cost		(38)	(51)
	Decrease in taxation			5
	(Decrease) in profit for the year		(1)	(13)
	Impact on attributable earnings
	per share (cents)			(4)
	Impact on diluted attributable
	earnings per share (cents)			(4)
	Balance sheet impact
	(Decrease) in property, plant and
	equipment		(363)	(357)
	Increase in deferred tax asset		23
	(Decrease) in retained earnings		(57)	(58)
	Increase in non-current interest-
	bearing borrowings – Finance lease
	liability		246	247
	(Decrease) in other long-term
	payables: Mittal Steel (South Africa)
	captive mines		(520)	(604)
	(Decrease) in deferred tax liabilities			(22)
	(Decrease) in current interest-bearing
	borrowings – finance lease liability		(9)
	Increase in trade and other payables			80

	There were no amounts attributable to the minorities. The impact of the change on the 31 December 2004 financial statements is a decrease in property, plant and equipment of R349 million, an increase in deferred tax assets of R18 million, a decrease in retained earnings of R45 million, an increase in finance lease liabilities of R212 million, a decrease in other long-term payables of R607 million and an increase in trade and other payables of R109 million. The above includes the iron ore impact for the period ended 31 October 2006.

Notes to the annual financial statements

for the year ended 31 December 2006

Group

Company

Restated

Restated

2006

2005

2006

2005

Notes

Rm

Rm

Rm

Rm

2.

CHANGES in ACCOUNTING POLICY