ArcelorMittal South Africa 2007 Annual Report Page 118 Group Company

2007

Rm

2006

Rm

2007

Rm

2006

Rm

21.  ASSETS CLASSIFIED AS HELD FOR SALE Machinery, plant and equipment held for sale

6

6

Manufacturing of ferrite powder at Coke and Chemicals ceased on 31 March 2006 due to market conditions.  The company approved of the disposal of the plant in 2006 and short-listed likely buyers with the intention of completing the sale in 2007. While the company remains committed to sell the asset, realising its carrying value by sale and not through use, it became apparent in 2007 that the sale would not be accomplished in the manner initially intended nor within the timeframe envisaged, and permitted by IFRS 5. The plant was reclassified as property, plant and equipment (note 16).  On reclassification an impairment charge of R4 million was recognised to ensure the carrying amount of the asset was measured at the lower of: •   its carrying amount before the plant was classified as held for sale, adjusted for any depreciation that would have been recognised had the plant not been classified as held for sale; and •   its recoverable amount at the date of the subsequent decision to reclassify the plant back to property, plant and equipment. 22.  INVENTORIES Finished products

1 146

1 063

1 012

977

Work-in-progress

1 487

1 851

1 467

1 841

Raw materials

1 741

1 458

1 366

1 222

Plant spares and stores

416

403

351

343

4 790

4 775

4 196

4 383

Included in the above are finished products of R111 million (December 2006: R91 million) and work-in-progress of R37 million (December 2006: R7 million) which has been written down to net realisable value. Notes to the group and company annual financial statements continued for the year ended 31 December 2007