35. CONTINGENT LIABILITIES AND FINANCIAL GUARANTEE CONTRACTS (a) CONTINGENT LIABILITIES The tax assessment raised in 2023 by the Mauritius Revenue Authority (‘MRA’)and to which the Company has objected has been determined during the year by the Objections, Appeals Dispute Resolutions Department of the Mauritius Revenue Authority. As of 30 September 2024, the case had not been heard by the Assessment Review Committee and the outcome was still unknown. The claim from the MRA amounts to MUR41.2m. The Company maintains that the treatment it has adopted is consistent with the economic characteristics of its transactions and most importantly is consistent with the general accepted principles of tax policy on neutrality. (b) FINANCIAL GUARANTEE CONTRACTS GROUP COMPANY Sep-24 MUR m Sep-23 MUR m Sep-24 MUR m Sep-23 MUR m Financial guarantee 525.4 90.0 525.4 90.0 At 30 September 2024, the Company had contingent liabilities in respect of guarantees from which it is anticipated that no material liabilities would arise. Financial guarantees relate to bank guarantees of MUR525.4m (2023: MUR90m) given on behalf of subsidiary companies with respect to long term debt contracted by the latter arising in the ordinary course of business from which it is anticipated that no material losses will arise. The Directors consider that no liabilities will arise as the probability for default in respect of the guarantee is remote. 36. EVENTS AFTER REPORTING DATE Cim Financial Services Ltd issued MUR2.0bn of notes under the MUR9.0bn Medium Term Note programme set out in the listing particulars dated 15 November 2024. The notes qualify as ‘Green Bonds’ under the Guidelines for Issue of Corporate and Green Bonds in Mauritius of the Financial Services Commission. The funds raised will continue to be used for purposes that align with the UN sustainable development goals stated in CFSL’s Green Bond Framework. On 16 December 2024, the Board of Directors of CFSL has declared a final dividend of MUR 0.52 per share (total amounting to MUR 353.9m) payable in respect of all ordinary shares of CFSL. 37. EMPLOYEE OPTION PLAN Employees of the CFSL Group are entitled to participate in the ESOS, whereby they are offered the right to buy a certain number of shares at a fixed price and at some period of time in the future. The objectives of the ESOS are as follows: • Providing targeted incentives to staff; • Aligning the objectives of staff members with those of the Shareholders; • Encouraging the adoption of a team environment and business culture; and • Increasing individual productivity. The ESOS is designed to provide long-term incentives for the Company’s members of its executive committee and management committee (including executive directors) to deliver and create long-term shareholder value. Under the plan, participants are granted options which only vest if certain service conditions standards are met. Participation in the plan is at the board’s discretion, and no individual has a contractual right to participate in the plan or to receive any guaranteed benefits. The amount of options that will vest depends on the Company’s members of Executive Committee and Management Committee have satisfied the service conditions of 3 years. Once vested, the options remain exercisable, in whole or in part, through two (2) specific windows namely (i) a period of 14 days following the publication of the 6 monthly interim reports of the Company and (ii) a period of 14 days following the publication of the preliminary 12 months reports of the Company over a period of 5 years from the vesting date. Beyond this period, the option to subscribe to the option shares shall lapse. Options are granted under the scheme for no consideration and will rank pari passu in all respects with existing ordinary shares issued, including voting purposes and in full for all dividends and distributions on ordinary shares declared. When exercisable, each option is convertible into one ordinary share 14 days after the release of the half-yearly and annual financial results of the Company to the market. The exercise price of options is based on the weighted average price at which the Company’s shares are traded on the Stock Exchange of Mauritius over the last 3 months prior to the announcement of the annual performance bonus (adjusted to reflect any change in capital structure), less a discount, which does not exceed 25%. 201 Introduction Group Overview Leadership Strategy & Performance Risk Management Corporate Governance Statutory Disclosures Financial
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