annual report - sharedataannual report for the period ended 30 april 2008 annual report for the...

Holdings Limitedbeg teHoldings Limited

Annual ReportFor the period ended 30 April 2008

Annual ReportFor the period ended 30 April 2008

Reg No.: 2002/011635/06

85 Durham Street, Clubview, Centurion, Pretoria PO Box 13983 Clubview 0014 Tel: 0861 123438, Fax: 0861 223438, E-mail: [email protected], Website: www.beget.co.za

DEFINITIONS “BEE” Black Economic Empowerment

“the board” The board of directors of Beget Holdings Limited

“the current year” The 12 months ending 30 April 2008

“the group” Beget Holdings Limited and its subsidiaries, investments and associates “Beacham” Beacham Capital Limited “Beget” or “the company” Beget Holdings Limited (Registration number

2002/011635/06)

“FD” Financial Director

“IDC” Industrial Development Corporation of South Africa Limited

“IT” Information Technology

“JSE” JSE Limited South Africa

“King II Report” King Report on Corporate Governance for South Africa 2002

“MD” Managing Director

“the previous year” The 12 months ended 30 April 2007

“SA” South Africa

“SENS” Stock Exchange News Service

“the year” or “the year under review” The 12 months ended 30 April 2008

CONTENTS

Page

Statutory information 4

Group structure 5

Group MD’s review 6

Corporate governance report 8

Annual Financial Statements

Report of the independent auditors 12

Directors’ statement of responsibility 13

Declaration by company secretary 14

Directors’ report 15

Balance sheet 19

Income statement 20

Statement of changes in equity 21

Cash flow statement 22

Accounting Policies 23

Notes to the annual financial statements 36

Notice of annual general meeting 60

Form of proxy 6

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STATUTORY INFORMATION Postal Address Business Address Contact Details PO Box 13983 85 Durham Street Tel: 08611 23428 Clubview Clubview Fax: 08612 23438 0014 Centurion 0157 REGISTERED OFFICE 85 Durham Street Clubview Centurion 0157 AUDITORS PKF (Pretoria) Inc. 105 Club Avenue PO Box 98060 Waterkloof Heights Waterkloof Heights 0065 0065 BANKERS First National Bank Corporate Centurion COMPANY SECRETARY Ester Calitz 2 Gonubi Street PO Box 13983 Doornpoort Clubview 0186 0014 TRANSFER SECRETARIES Link Marketing Services SA (Pty) Ltd 5th Floor PO Box 4844 11 Diagonal Street Johannesburg Johannesburg 2001 SPONSOR Merchant Sponsors 2nd floor, North Wing PO Box 413146 Hyde Park Office Tower Craighall cnr 6th Road & Jan Smuts Avenue 2024 Hyde Park, Johannesburg

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GROUP STRUCTURE

Beget Holdings performs the group functions of establishing and implementing a strategy for growth, enhancing shareholder value and investor communications and to set the governance parameters and guidelines within which the group will operate. Beget Holdings further identifies opportunities for investment in related businesses, with specific focus on the integration of Internet and telecommunications software. Beget Solutions is the operational company control all the trading activities of the products. Small Business Units (SBU) all related activities are group together within each product allowing it to operate independently. Shared services are all the common activities like Finance, R&D and HR

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GROUP MD’S REVIEW OVERVIEW GROUP PROFILE Beget is an IT and telecoms group specializing in the development of applications on the GPRS technology platform. This enables the transmission of data using the cell phone network at a fraction of the cost of fixed and radio telephony. COMMENTARY ON RESULTS With the rebuilding of systems and procedures firmly in place the outcome is reflected in these results. Turnover increased by 75% to R23,4 million (2007: R13.3) and the group has made a profit of R10,2million compared to a loss of R19,9million in 2007. All divisions are performing well and we are glad to report that our GPRS modem division is also back on track. Beget is a member of a consortium that was awarded a tender for the Gauteng On-line e-learning project. The financial effects of this new division will only be reflected in the 2009 results but will have a substantial impact on the company’s future income. Of the 75% increase in turnover, R7.2million was contributed by the BEE royalty transaction that was concluded and the existing divisions showed a growth of 21% year on year. OPERATIONAL REVIEW The group now has five divisions:

• Web based Biometric with GPRS including: • Access control • Time & Attendance control • Payroll

• Web based SMS’s • Bulk SMS’s • MMS

• Web based LBS (Location Based Services) • SMSOS • Data base management with LBS

• GPRS Modems • GSM modems for communication • Telemetry in general

• School Tender Project • Power supplies • Web based Alarms systems • Biometric ID solution

. The focus that was applied to recruit, train and motivate a retail sales force has started to show results. The market for positive identification systems is growing and more businesses are beginning to realize the need to have biometric devices taking care of operations without human interface. The group culture is one of commitment to achieving improved performance, and management and staff are motivated and focused on delivery and profitability. The group’s focus is still mainly on WEB based solutions. Utilizing GPRS as the preferred communication platform, combined with WEB based applications as a real time solution, we can now deliver various solutions to our customers without them investing in any additional hardware. What follows is a brief operational overview of the Beget divisions:

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• MobileBIO is a biometric identity and access device utilizing wireless GPRS technology. Although some competing products are starting to emerge we are still enjoying a first mover advantage.. This division accounts for approximately 54% of group revenue and it continues to be the flagship product of the company. With a receptive South African market ready for positive identification systems, we are currently concentrating on sales locally.

• SMSmalls is affordable bulk SMS messaging and this division, which contributes approximately 24%

of the group revenue, continues to grow at a steady rate consistent with the industry.

• Location-Based Services (LBS) combines a suite of services and infrastructure, all locally developed. Solutions include consumer, commercial and emergency based products currently marketed to security companies. Beget has implemented a traffic incident management application as a trial which is intended to yield a number of similar business applications.

• Royalty income related to the usage of our Biometric Intellectual Property in industries that are not

competing with our Access control and Time & Attendance systems, produced 30% of the group revenue. The biometric technology is used in vehicle tracking and fleet management solutions to identify drivers.

• School project includes the supply of various components as well as the maintenance and service of

the equipment for 5 years. Currently 1,000 schools in Gauteng are being equipped with a computer laboratory. Beget is responsible for the following equipment:

o AC/DC power supplies to power 25 scholar computers with DC power in each school. This

reduces the risk of using AC power at each computer station. o GPRS web based alarm systems that will closely monitor the computer laboratory ,with

control room software and incident management. o Biometric authentication systems that allow scholars to access their computer documents

and emails only if positively identified. CORPORATE ACTIONS The BEE transaction was approved by our shareholders on 19 January 2008. The transaction can be summarized as follows:

• SMM Telematics (Pty) Ltd paid R7,2 million in Royalty fees to Beget for 5,000 driver identification devices and any additional devices ordered will charged at R1,440 per device.

• Beget issued 196,000,000 shares to SMM Telematics (Pty) Ltd, a black-owned company, of which the principal shareholder is Mr Tebogo Mogashoa, at par value. This resulted in SMM owning approximately 26% of Beget’s total issued shares.

PROSPECTS With these positive results and the new school project on hand we believe that Beget is set for solid growth. The board is confident of achieving profits in 2009 POST BALANCE SHEET EVENTS There are no post balance sheet events to report. ANNUAL FINANCIAL RESULTS The annual financial results for the year are set out in the annual financial statements on pages 13 to 59.

APPRECIATION

We thank the directors, management and staff of Beget for their hard work, perseverance and unwavering commitment. We also thank the group’s customers, suppliers and advisors for their invaluable support and the shareholders for their faith in the group. Andre Potgieter Group MD Pretoria

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CORPORATE GOVERNANCE REPORT

The directors support the approach to corporate governance in the King II Report and the principles of good corporate governance established by the Code of Corporate Practices and Conduct (“the Code”). Although the board’s priority has been to focus on strategically directing the company and enabling Beget’s profitability, the directors do monitor compliance with the Code and ensure ongoing improvement of operational and corporate practices. This is an evolving process and the board is constant implementing policies, procedures and processes to facilitate full compliance. The company complies with the Code as set out below:

The Board The board currently consists of five directors with three executive and two non-executive directors. The directors of the company at the date of this annual report and their attendance at board and audit committee meetings during the year are set out below. The number in brackets reflects the total number of meetings held during the year:

Name Board Meetings Audit Committee Meetings

*T Mogashoa (33) B.Sc.(Eng)

(Non Executive Chairman)

He has a strong entrepreneurial outlook and he has divers interests which include: the Managing Director of New Heights Property Development which focuses on development of retail shopping centres in emerging markets of South Africa

(Appointed 1 June 2007)

4 (4) 1 (2)

AH Potgieter (58)

(Group MD)

More than 20 years’ experience in the IT and telecommunications industries. Co-founded Beget in 2000 and listed the company in 2002.

4 (4)

* JS Coetzee (61) B.Com MBA

Previously the group Financial Director and financial manager of manufacturing companies John Shearer (Pty) Limited and Haggie Rand Limited, before co-founding Beget in 2000 and listing the company in 2002. (Resigned 27 September 2007)

2 (2) 2 (2)

* C van Coller (48) BJuris LLB

(Non executive)

Practising advocate with business interests in a number of private companies.

3 (4) 1 (2)

Henk Potgieter (33)

(IT Director)

More than 13 years’ experience in the IT and Web based applications. (Appointed 27 September 2007)

3 (4)

Delme Hawkins (36)

(Sales Director)

He has a strong entrepreneurial outlook and he has divers interests which include: the Managing Director of New Heights Property Development which focuses on development of retail shopping centres in emerging markets of South Africa

(Appointed 27 September 2007)

3 (4)

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The board meets at least four times per year to evaluate performance, assess risk and review the strategic direction of the group. Additional board meetings are convened as dictated by circumstances.

The roles of the non-executive Chairman and Group MD are separated. The division of responsibilities is echoed across the board and ensures a balance of authority which precludes any one director from exercising unfettered powers of decision-making. Non-executive directors provide objectivity and independence in board deliberations and are not involved in the day-to-day operations of the company. Executive directors implement operational decisions.

Details of directors retiring and offering themselves for re-election at the upcoming annual general meeting are set out in the notice of annual general meeting included in this annual report. In accordance with the articles of association executive directors are subject to retirement by rotation and re-election every year. In accordance with the company’s articles of association the appointment of new directors is confirmed by shareholders at the next annual general meeting following the appointment.

All directors have unrestricted access to the advice and services of the company secretary and to company records, information, documents and property. Non-executive directors also have unfettered access to management. All directors are entitled, at Beget’s expense, to seek independent professional advice on any matters pertaining to the group where they deem this to be necessary. All directors and other employees who have access to financial results and any other price-sensitive information are prohibited from dealing in Beget shares during ‘closed periods’ as defined, or while the company is trading under cautionary. Further, directors are obliged to obtain clearance from the chairman prior to dealing in the shares of the company and to report any share dealings to the company secretary who, together with the sponsor, will ensure that the information is published on SENS.

In accordance with the South African Companies Act directors are further required to disclose their additional directorships and any potential conflicts of interest to the chairman and the company secretary. The directors are cognisant of the requirement for a formal Board Charter in line with the recommendations of the King II Report and this is currently a work-in-process. The Board Charter will address matters relating to board composition, leadership, remuneration and evaluation, the review of group processes and procedures, key operational risks and corporate governance compliance. The board further recognises the need for self-evaluation and peer appraisal and will seek to put in place appropriate procedures in the current year.

Board Committees During the year the directors were of the opinion that the regularity of board meetings and size of the board precluded the need to hold separate remuneration and nomination committee meetings in order to address matters specifically reserved for these committees. However, in accordance with the directors’ commitment to implementing corporate governance recommendations, a separate remuneration committee will be established in the current year with specific responsibilities. A charter governing the remuneration committee’s functions, levels of materiality and processes will be adopted and reviewed annually. The committee will also complete an annual self-evaluation exercise. Nominations will continue to be handled by the board as a whole.

Audit committee

The audit committee comprises of C. van Coller and T Mogashoa. The committee meets twice per year and is confident that this is sufficient for the purposes of the business. Additional meetings will be held should this be necessary. The group’s external auditors and executive management are invited to attend every meeting.

The audit committee is responsible for reviewing accounting, auditing and financial reporting matters to ensure that an effective control environment in the group is maintained and for assessing adherence to these controls. The committee monitors and appraises internal operating structures and systems. The committee further monitors proposed changes in accounting policies, reviews the internal audit functions, discusses and advises the board on the accounting implications of major transactions and recommends the appointment of external auditors for approval by shareholders. The responsibility to review the group’s compliance with the King II Report and JSE Listings Requirements also falls to the committee.

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Subject to overall board responsibility, the committee is responsible for risk management. It continually assesses the major business and operational risks faced by Beget and recommends and monitors appropriate risk management strategies. The chairman of the committee attends the annual general meeting in line with the King II Report recommendations.

Remuneration committee

The remuneration committee comprised of T Mogashoa, who acts as committee chairman, and A. Potgieter. Salaries are reviewed twice a year at in April and on October and all recommendations must be approved by this committee. The exco management team plays an active role in this committee and must present a in-depth report on every employee to be evaluated.

Accounting and Auditing External audit

Beget’s external auditors are responsible for providing an independent assessment of internal controls and reporting on whether the financial statements are fairly presented in compliance with International Financial Reporting Standards. The preparation of the annual financial statements remains the responsibility of the directors and management.

Internal audit

Internal audit is an independent appraisal function that assists the board and management in the effective discharge of their responsibilities. The scope of the internal audit function includes assessing the adequacy of internal controls, fraud prevention, risk management and safeguarding of assets. The internal audit provides input crucial to the risk assessment exercise performed by the audit committee. Unrestricted consultation is encouraged between the internal audit function, directors, management and Beget’s external auditors.

Systems of Internal Control While the effectiveness of the internal control systems is monitored by the audit committee, overall responsibility rests with the board. The systems of internal control are designed to provide reasonable, but not absolute assurance as to the integrity and reliability of the financial statements, to safeguard, verify and maintain accountability of Beget’s assets and to identify and minimise significant fraud, potential liability, loss and material misstatement while complying with applicable laws and regulations. There are inherent limitations to the effectiveness of systems of internal control, including the possibility of human error and the circumvention or overriding of controls. Further, the effectiveness of an internal control system can change with circumstances. The systems are therefore designed to manage rather than eliminate risk of failure and opportunity risk. The directors have satisfied themselves that adequate systems of internal control are in place to mitigate significant risks identified to an acceptable level. Nothing has come to their attention to indicate that a material breakdown in the functioning of these systems within the group has occurred during the year.

Sustainability Reporting In compliance with the recommendations of the King II Report and global best-practice, Beget will concentrate going forward on establishing social and environmental policies and procedures where appropriate to the nature of the company’s activities.

BEE

The group is supportive of broad-based BEE and has developed a formal BEE policy. The policy encompasses BEE participation and ownership. Outstanding issues include annual affirmative procurement targets and guidelines for identifying preferred PDI suppliers. Beget is currently in the verification process and an audited BEE scorecard will be issued upon completion.

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Employees

The board is committed to providing equal opportunities for all its employees and does not tolerate discrimination on any basis whatsoever. The company has developed a formal Employment Equity policy that will ensure equitable representation in all occupational categories and levels in the workforce and achieve an employment status that fairly represents the demographics of the country. The policy will further encompass formal skills development and training programmes.

Beget is committed to enforcing the most stringent standards of safety in the workplace and seeks to ensure compliance with the requirements of the South African Occupational Health and Safety Act.

The company recognises that the HIV/AIDS pandemic is a social, health and operational challenge. Due to the size of Beget’s workforce no formal HIV/AIDS policy is yet in place. This will be considered by the board in the current year. However, the company offers ill employees fair and equal access to company benefits and promotion opportunities where practically possible, and fosters a supportive working environment which is free of victimisation. Code of Ethics and Conduct (“the Ethics Code”) The company is committed to strict standards of ethical conduct, fair dealing and integrity in business practice. To this end Beget will look to develop the Ethics Code setting out clear guidelines for honest and integrity based conduct and fair business practices. Employees will be educated about the responsibility to report to management any actual, perceived or potential violation of the Ethics Code. Management will bear the responsibility of monitoring ongoing compliance and addressing any violation.

Corporate Social Responsibility (“CSR”) Beget acknowledges its responsibility towards both the community in which it operates and deserving projects nationally. However the board must prioritise the stabilising of the company and securing of future prospects. It is intended that a formal CSR programme will be considered when it is operationally viable.

Investor and Stakeholder Communications Beget is committed to transparent, timely, consistent and accurate communications to investors and stakeholders. Company announcements are released on SENS and are posted on the company’s website. Shareholders are encouraged to attend the annual general meeting in order to facilitate greater interaction with the board. The Group MD is also available to answer queries from investors and stakeholders at any time.

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Report of the Independent Auditors

To the shareholder of BEGET HOLDINGS LIMITED

We have audited the accompanying annual financial statements of BEGET HOLDINGS LIMITED, which comprise the directors' report, the balance sheet as at 30 April 2008, the income statement, the statement of changes in equity and cash flow statement for the year then ended, a summary of significant accounting policies and other explanatory notes.

Directors' Responsibility for the Financial Statements

The company's directors are responsible for the preparation and fair presentation of these annual financial statements in accordance with International Financial Reporting Standards, and in the manner required by the Companies Act of South Africa, 1973. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of annual financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

Auditors' Responsibility

Our responsibility is to express an opinion on these annual financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the annual financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the annual financial statements. The procedures selected depend on the auditors' judgement, including the assessment of the risks of material misstatement of the annual financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the annual financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the annual financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the annual financial statements present fairly, in all material respects, the financial position of the company as of 30 April 2008, and of its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards, and in the manner required by the Companies Act of South Africa, 1973.

PKF (Pretoria) Incorporated Registered Auditors Chartered Accountants (SA) Pretoria Per: RD Badenhorst Registration number: 2000/026635/21

31 July 2008 Pretoria

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BEGET HOLDINGS LIMITED (Registration number 2002/011635/06) Annual Financial Statements for the year ended 30 April 2008

Directors' Responsibilities and Approval

The directors are required by the Companies Act of South Africa, 1973, to maintain adequate accounting records and are responsible for the content and integrity of the annual financial statements and related financial information included in this report. It is their responsibility to ensure that the annual financial statements fairly present the state of affairs of the group as at the end of the financial year and the results of its operations and cash flows for the period then ended, in conformity with International Financial Reporting Standards. The external auditors are engaged to express an independent opinion on the annual financial statements.

The annual financial statements are prepared in accordance with International Financial Reporting Standards and are based upon appropriate accounting policies consistently applied and supported by reasonable and prudent judgments and estimates.

The directors acknowledge that they are ultimately responsible for the system of internal financial control established by the group and place considerable importance on maintaining a strong control environment. To enable the directors to meet these responsibilities, the company sets standards for internal control aimed at reducing the risk of error or loss in a cost effective manner. The standards include the proper delegation of responsibilities within a clearly defined framework, effective accounting procedures and adequate segregation of duties to ensure an acceptable level of risk. These controls are monitored throughout the group and all employees are required to maintain the highest ethical standards in ensuring the group’s business is conducted in a manner that in all reasonable circumstances is above reproach. The focus of risk management in the group is on identifying, assessing, managing and monitoring all known forms of risk across the group. While operating risk cannot be fully eliminated, the group endeavours to minimise it by ensuring that appropriate infrastructure, controls, systems and ethical behaviour are applied and managed within predetermined procedures and constraints.

The directors are of the opinion, based on the information and explanations given by management, that the system of internal control provides reasonable assurance that the financial records may be relied on for the preparation of the annual financial statements. However, any system of internal financial control can provide only reasonable, and not absolute, assurance against material misstatement or loss.

The directors have reviewed the group’s cash flow forecast for the year to 30 April 2009 and, in the light of this review and the current financial position, they are satisfied that the group has or has access to adequate resources to continue in operational existence for the foreseeable future.

The external auditors are responsible for independently reviewing and reporting on the group's annual financial statements. The annual financial statements have been examined by the group's external auditors and their report is presented on page 3.

The annual financial statements set out on page 5 to 53, which have been prepared on the going concern basis, were approved by the board of directors on 31 July 2008 and were signed on its behalf by:

AH Potgieter DE Hawkins

Pretoria

31 July 2008

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DECLARATION BY COMPANY SECRETARY

Ester Calitz 2 Gonubi Street PO Box 13983 Doornpoort Clubview 0186 0014 Tel: 012 6843005 Fax: 0861123438 30 April 208 Dear Sir,

DECLARATION BY COMPANY SECRETARY In our capacity as company secretary, we declare that for the year ended 30 April 2008 the company has lodged with the Registrar of Companies all such returns as are required of a public company in terms of the Companies Act, 1973, as amended, and that such returns are true and up to date. Ester Calitz Company Secretary Pretoria

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Directors' Report

Directors' Report

The directors submit their report for the year ended 30 April 2008.

1. Review of activities

Main business and operations

The group is engaged through its subsidiaries in IT and telecoms group specializing in the development ofapplications on the GPRS technology platform. This enables the transmission of data using the cell phonenetwork at a fraction of the cost of fixed and radio telephony .

The operating results and state of affairs of the group are fully set out in the attached annual financialstatements and do not in our opinion require any further comment.

Net profit of the group was R 10 200 327 (2007: loss R 19 901 214), after taxation of R (4 276 706) (2007: R -).

2. Going concern

We draw attention to the fact that at 30 April 2008, the group had accumulated losses of R (32,377,092), but the group’s total assets exceed its liabilities by R 3,340,293. The group has also made a profit after taxation in the current year of R10,200,327.

The annual financial statements have been prepared on the basis of accounting policies applicable to a going concern. This basis presumes that funds will be available to finance future operations and that the realization of assets and settlement of liabilities, contingent obligations and commitments will occur in the ordinary course of business. The ability of the company to continue as a going concern is dependent on a number of factors. The most significant of these is that the group reach their profit forecast through realizing of profits budgeted for in the schools project tender. The deal is part BEE agreement with SMM Telematics (Pty) Ltd, concluded in the current financial year. Installation in terms of the tender has already commenced in April 2008.

3. Post balance sheet events

The directors are not aware of any matter or circumstance arising since the end of the financial year.

4. Directors' interest in contracts

The BEE transaction was approved by the shareholders on 19 January 2008. The transaction can be summarized as follows:

Mr T Mogashoa is the principal shareholder of SMM Telematis (Pty) Ltd a black owned company.

SMM Telematics (Pty) Ltd paid R7,2 million in Royalty fees to Beget for the 5,000 driver identification devices and any additional devices ordered will be charged at R1,440 per device, which is lower than market value.

204 250 000 shares were issued at 4 cents per share, on 18 January 2008, to SMM Telematics (Pty) Ltd. This resulted in SMM Telematics (Pty) Ltd owning approximately 26% of Beget’s total issued shares. Beget has been awarded a schools project which commenced in April 2008.

5. Authorised and issued share capital

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Directors' Report

There were no changes in the authorised share capital of the group during the year under review. The following changes was made to the issued share capital: - 1 671 681 shares were issued at 8.97 cents per share on 31 July 2007, to Stanley Cecil Harris as a result of settling a debt of R150,000.

- 204 250 000 shares were issued at 4 cents per share on 18 January 2008, to SMM Telematics (Pty) Ltd in accordance with a BEE transaction. Through the transaction, the company has been awarded a schools project which commenced in April 2008. An intangible asset was raised to the value of R8,170,000 which will be written 125

- As a result of the above issues and conversions, share premium of R 8 091 588 was raised after accounting for share issue expenses of R228,000.

Shareholders registered as holding 5% or more of the company's share capital at 30 April 2008 are: No of shares % Beacham Capital Limited 41,660,000 5.46 Shareholders' spread: No of shares % No of shareholders Directors and/or their nominees 331,490,317 43.45 6 Senior management 165,000 0.02 3 Public shareholders 431,225,175 56.53 1058 Total 762,880,492 100.00 1067 Directors' shareholding: 2008 2007 Beneficial Non-beneficial Beneficial Non-beneficial AH Potgieter 36,125,000 47,625,500 AH Potgieter (Jnr) 29,308,588 JS Coetzee * 27,662,062 30,875,000 CJ van Coller 191,667 191,667 T Mogashoa 204,250,000 DE Hawkins 34,125,000 * Resigned during the year

6. Borrowing limitations

In terms of the Articles of association of the company, the directors may exercise all the powers of the company to borrow money, as they consider appropriate.

7. Non-current assets

Details of major changes in the nature of the non-current assets of the company during the year were as follows:

- Reversal of prior period impairment of intangible asset. - Capitalization of intangible asset due to BEE share issue. - Accounting for Deferred tax assets due to carried over assessed losses being utilised.

8. Dividends

No dividends were declared or paid to shareholder during the year.

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Directors' Report

9. Directors

The directors of the company during the year and to the date of this report are as follows:

Name Nationality Changes AH Potgieter RSA DE Hawkins RSA Appointed 27 September

2007 CJ van Coller RSA T Mogashoa RSA Appointed 01 June 2007 JS Coetzee RSA Resigned 27 September

2007 AH Potgieter (Jnr) RSA Appointed 27 September

2007

Director's emoluments

2008

Director's fees

Basic salary Other benefits

Total

AH Potgieter 60 000 320 700 34 800 415 500 AH Potgieter (Jnr) - 362 250 - 362 250 DE Hawkins - 377 700 34 800 412 500 Non-executive directors

JS Coetzee 15 000 - - 15 000 CJ van Coller 6 250 - - 6 250

81 250 1 060 650 69 600 1 211 500

2007

Director's fees

Basic salary Other benefits

Total

Executive directors

AH Potgieter 60 000 246 400 79 600 386 000 S Hischowitz - 308 610 169 254 477 864

CJ van Coller 15 000 - - 15 000 JS Coetzee 15 000 - - 15 000 DB Harrington 15 000 - - 15 000

105 000 555 010 248 854 908 864

10. Secretary

Secricover Network CC resigned as secretary of the company on 22 February 2008 and E Calitz was appointedin their stead on 22 February 2008.

Business address 2 Gonubi Street Doornpoort

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Directors' Report

Pretoria 0017 Postal address PO Box 13983 Clubview Centurion 0014

11. Interest in subsidiaries

Name of subsidiary Country of incorporation if not the RSA

Net income (loss) after tax

Beget Solutions (Pty) Ltd 6 864 294 Beget Interactive (Pty) Ltd - Beget Dynamics (Pty) Ltd - Beget Connect (Pty) Ltd - Beget VPN (Pty) Ltd - Beget SMsolutions (Pty) Ltd - Beget International (Pty) Ltd - Beget NQS (Pty) Ltd - Smartcast (Pty) Ltd -

All the subsidiaries, with the exception of Beget Solutions (Pty) Ltd, were dormant in the current year.

Details of the company's investment in subsidiaries are set out in note 6.

12. Special resolutions

At the annual general meeting of the shareholders on 27 September 2007 it was resolved that the directors be and thereby are authorised, by way of general approval and in terms of Article 31.10 of the Articles of Association, to acquire, on behalf of the company or its subsidiaries, ordinary shares issued by the company, in terms of Sections 85 and 89 of the Companies Act, 1973, as amended, and in terms of the Listing Requirements of the JSE Limited South Africa ("JSE"). This special resolution shall only be valid until the next annual general meeting of the company.

In a special resolution that was passed at a shareholders meeting held on 19 January 2008, the shareholders of the company approved the BEE transaction where SMM Telematics (Pty) Ltd will pay R7,2 million in Royalty fees to Beget for 5,000 driver identification devices and any additional devices ordered will charged at R1,440 per device which is below market value. Beget will issue 204,250,000 shares to SMM Telematics (Pty) Ltd, a black-owned company, of which the principal shareholder is Mr. Tebogo Mogashoa, at fair value. This will result in SMM Telematics (Pty) Ltd owning approximately 26% of Beget’s total issued shares.

13. Auditors

PKF (Pretoria) Incorporated will continue in office in accordance with section 270(2) of the Companies Act. 14. Litigation

The directors are not aware of any legal or arbitration proceedings, including those pending or threatened, that may have or had in the recent past (the past 12 months) a material impact on the group’s financial position

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Balance Sheet

Group Company Figures in Rand Note(s) 2008 2007 2008 2007

Assets

Non-Current Assets Property, plant and equipment 4 397 945 597 476 - -Intangible assets 5 11 906 457 1 190 494 11 274 366 -Investments in subsidiaries 6 - - 1 500 033 1 500 033Loans to shareholders 8 - 74 150 - -Deferred tax 10 4 507 583 - 1 274 580 -

16 811 985 1 862 120 14 048 979 1 500 033

Current Assets Inventories 11 1 406 527 1 026 961 - -Loans to group companies 7 - - 1 169 718 1 652 763Trade and other receivables 12 6 248 147 972 703 - 67 573Cash and cash equivalents 13 99 676 99 473 99 659 98 849 7 754 350 2 099 137 1 269 377 1 819 185

Total Assets 24 566 335 3 961 257 15 318 356 3 319 218

Equity and Liabilities

Equity Share capital 14 35 717 385 27 625 385 35 717 385 27 625 385Accumulated loss (32 377 092) (42 577 419) (22 717 236) (26 053 267)

3 340 293 (14 952 034) 13 000 149 1 572 118

Liabilities

Non-Current Liabilities Loans from shareholders 8 2 205 940 2 824 497 - -Finance lease obligation 17 173 683 235 224 - -Deferred income 18 1 699 442 1 807 583 - -Deferred tax 10 230 877 - - -

4 309 942 4 867 304 - -

Current Liabilities Other financial liabilities 16 3 776 018 3 575 749 1 549 047 873 829Current tax payable 12 008 12 008 12 008 12 008Finance lease obligation 17 57 115 52 642 - -Trade and other payables 20 10 752 624 7 908 763 655 365 758 297Deferred income 18 1 311 316 928 606 - -Provisions 19 194 749 735 583 - -Bank overdraft 13 812 270 832 636 101 787 102 966

16 916 100 14 045 987 2 318 207 1 747 100 Total Liabilities 21 226 042 18 913 291 2 318 207 1 747 100 Total Equity and Liabilities 24 566 335 3 961 257 15 318 356 3 319 218

Nett asset value per share (cents) 0.54 -2.94

Nett tangible asset value per share (cents) -1.39 -3.17

19


Income Statement

Group Company

Figures in Rand Note(s) 2008 2007 2008 2007

Revenue 22 23 442 123 13 277 365 486 887 422 734 Cost of sales 23 (10 230 325) (5 880 477) (30 375) (5 560)

Gross profit 13 211 798 7 396 888 456 512 417 174 Other income 1 650 - - - Operating expenses (5 329 984) (25 051 318) 2 052 697 (13 147 244)

Operating profit (loss) 24 7 883 464 (17 654 430) 2 509 209 (12 730 070) Investment revenue 25 9 577 5 031 9 195 4 815 Finance costs 26 (1 969 420) (2 251 815) (456 953) (748 739)

Profit (loss) before taxation 5 923 621 (19 901 214) 2 061 451 (13 473 994) Taxation 27 4 276 706 - 1 274 580 -

Profit (loss) for the year 10 200 327 (19 901 214) 3 336 031 (13 473 994)

Earnings ratios (cents)

Earnings per share 40 1.65 (3.91)

Headline earnings per share 40 0.69 (1.68)

Diluted earnings per share 40 1.65 (3.91)

Diluted headline earnings per share 40 0.69 (1.68)

20


Statement of Changes in Equity

Figures in Rand Share capital Share

premium Total share

capital Accumulate

d loss Total equity

Group

Balance at 01 May 2006 964 24 343 421 24 344 385 (22 749 703) 1 594 682 Changes in equity Loss for the year - - - (19 901 214) (19 901 214) Issue of shares 150 3 451 850 3 452 000 - 3 452 000 Share issue expenses - (171 000) (171 000) - (171 000) Prior year adjustments - - - 73 498 73 498 (See note 36)

Total changes 150 3 280 850 3 281 000 (19 827 716) (16 546 716)

Balance at 01 May 2007 1 114 27 624 271 27 625 385 (42 577 419) (14 952 034) Changes in equity Profit for the year - - - 10 200 327 10 200 327 Issue of shares 412 8 319 588 8 320 000 - 8 320 000 Share issue expenses - (228 000) (228 000) - (228 000)

Total changes 412 8 091 588 8 092 000 10 200 327 18 292 327

Balance at 30 April 2008 1 526 35 715 859 35 717 385 (32 377 092) 3 340 293

Note(s) 14 14 14

Company

Balance at 01 May 2006 964 24 343 421 24 344 385 (12 579 273) 11 765 112 Changes in equity Loss for the year - - - (13 473 994) (13 473 994) Issue of shares 150 3 451 850 3 452 000 - 3 452 000 Share issue expenses - (171 000) (171 000) - (171 000)

Total changes 150 3 280 850 3 281 000 (13 473 994) (10 192 994)

Balance at 01 May 2007 1 114 27 624 271 27 625 385 (26 053 267) 1 572 118 Changes in equity Profit for the year - - - 3 336 031 3 336 031 Issue of shares 412 8 319 588 8 320 000 - 8 320 000 Share issue expenses - (228 000) (228 000) - (228 000)

Total changes 412 8 091 588 8 092 000 3 336 031 11 428 031

Balance at 30 April 2008 1 526 35 715 859 35 717 385 (22 717 236) 13 000 149

Note(s) 14 14 14

21


Cash Flow Statement

Group Company

Figures in Rand Note(s) 2008 2007 2008 2007

Cash flows from operating activities

Cash receipts from customers 18 166 679 13 964 359 486 887 382 280 Cash paid to suppliers and employees (15 541 635) (12 937 886) (967 403) (1 744 784)

Cash used in operations 30 2 625 044 1 026 473 (480 516) (1 362 504) Interest income 9 577 5 031 9 195 4 815 Finance costs (1 948 154) (2 227 970) (456 953) (748 739)

Net cash from operating activities 686 467 (1 196 466) (928 274) (2 106 428)

Cash flows from investing activities

Purchase of property, plant and equipment

4 (17 076) (307 746) - -

Sale of property, plant and equipment 4 1 650 - - - Sale of other intangible assets 5 - 5 262 - - Loans to group companies repaid - - 483 045 1 848 986

Net cash from investing activities (15 426) (302 484) 483 045 1 848 986

Cash flows from financing activities

Proceeds on share issue 14 - 3 452 000 - 3 452 000 Proceeds from other financial liabilities 314 696 - 675 218 - Repayment of other financial liabilities (114 427) (4 242 111) - (2 299 587) Movement in loans to directors, managers and employees

- 48 122 - -

Proceeds from shareholders loan - 2 095 787 - - Repayment of shareholders loan (544 407) - - (728 710) Finance lease payments (78 334) 264 021 - - Share issue expenses 32 (228 000) (171 000) (228 000) (171 000)

Net cash from financing activities (650 472) 1 446 819 447 218 252 703

Total cash movement for the year 20 569 (52 131) 1 989 (4 739) Cash at the beginning of the year (733 163) (681 032) (4 117) 622

Total cash at end of the year 13 (712 594) (733 163) (2 128) (4 117)

22


Accounting Policies

1. Presentation of Annual Financial Statements

The annual financial statements have been prepared in accordance with International Financial Reporting Standards, and the Companies Act of South Africa, 1973. The annual financial statements have been prepared on the historical cost basis, except for the measurement of investment properties and certain financial instruments at fair value, and incorporate the principal accounting policies set out below.

These accounting policies are consistent with the previous period.

1.1 Significant judgements

In preparing the annual financial statements, management is required to make estimates and assumptions that affect the amounts represented in the annual financial statements and related disclosures. Use of available information and the application of judgement is inherent in the formation of estimates. Actual results in the future could differ from these estimates which may be material to the annual financial statements. Significant judgements include:

Allowance for slow moving, damaged and obsolete stock

An allowance for stock to write stock down to the lower of cost or net realisable value. Management have made estimates of the selling price and direct cost to sell on certain inventory items. The write down is included in the operation profit note 24.

Fair value estimation

The fair value of financial instruments that are not traded in an active market is determined by using valuation techniques. The group uses a variety of methods and makes assumptions that are based on market conditions existing at each balance sheet date. Quoted market prices or dealer quotes for similar instruments are used for long-term debt. Other techniques, such as estimated discounted cash flows, are used to determine fair value for the remaining financial instruments.

The carrying value less impairment provision of trade receivables and payables are assumed to approximate their fair values. The fair value of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash flows at the current market interest rate that is available to the group for similar financial instruments.

Impairment testing

The group reviews and tests the carrying value of assets when events or changes in circumstances suggest that the carrying amount may not be recoverable. Assets are grouped at the lowest level for which identifiable cash flows are largely independent of cash flows of other assets and liabilities. If there are indications that impairment may have occurred, estimates are prepared of expected future cash flows for each group of assets. Expected future cash flows used to determine the value in use of tangible and intangible assets are calculated using the profit forecast according to the schools project which commenced in April 2008.

23


Accounting Policies

1.2 Property, plant and equipment (continued)

Provisions

Provisions were raised and management determined an estimate based on the information available. Additional disclosure of these estimates of provisions are included in note 19 - Provisions.

Taxation

Judgement is required in determining the provision for income taxes due to the complexity of legislation. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. The group recognises liabilities for anticipated tax audit issues based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made.

The group recognises the net future tax benefit related to deferred income tax assets to the extent that it is probable that the deductible temporary differences will reverse in the foreseeable future. Assessing the recoverability of deferred income tax assets requires the group to make significant estimates related to expectations of future taxable income. Estimates of future taxable income are based on forecast cash flows from operations and the application of existing tax laws. To the extent that future cash flows and taxable income differ significantly from estimates, the ability of the group to realise the net deferred tax assets recorded at the balance sheet date could be impacted.

1.2 Property, plant and equipment

The cost of an item of property, plant and equipment is recognised as an asset when: it is probable that future economic benefits associated with the item will flow to the company; and the cost of the item can be measured reliably.

Costs include costs incurred initially to acquire or construct an item of property, plant and equipment and costs incurred subsequently to add to, replace part of, or service it. If a replacement cost is recognised in the carrying amount of an item of property, plant and equipment, the carrying amount of the replaced part is derecognised.

The initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located is also included in the cost of property, plant and equipment.

Property, plant and equipment is carried at cost less accumulated depreciation and any impairment losses.

Item Average useful life Furniture and fixtures 6 years Motor vehicles 4 years Office equipment 5 years IT equipment 3 years Computer software 5 years

The residual value and the useful life of each asset are reviewed at each financial period-end.

Each part of an item of property, plant and equipment with a cost that is significant in relation to the total cost of the item shall be depreciated separately.

The depreciation charge for each period is recognised in profit or loss unless it is included in the carrying amount of another asset.

The gain or loss arising from the derecognition of an item of property, plant and equipment is included in

24


Accounting Policies

1.2 Property, plant and equipment (continued)

profit or loss when the item is derecognised. The gain or loss arising from the derecognition of an item of property, plant and equipment is determined as the difference between the net disposal proceeds, if any, and the carrying amount of the item.

1.3 Goodwill

Goodwill is initially measured at cost, being the excess of the cost of the business combination over the company's interest of the net fair value of the identifiable assets, liabilities and contingent liabilities.

Subsequently goodwill is carried at cost less any accumulated impairment.

The excess of the company’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities over the cost of the business combination is immediately recognised in profit or loss.

Internally generated goodwill is not recognised as an asset.

1.4 Intangible assets

An intangible asset is recognised when: it is probable that the expected future economic benefits that are attributable to the asset will flow to

the entity; and the cost of the asset can be measured reliably.

Intangible assets are initially recognised at cost.

Expenditure on research (or on the research phase of an internal project) is recognised as an expense when it is incurred.

An intangible asset arising from development (or from the development phase of an internal project) isrecognised when: it is technically feasible to complete the asset so that it will be available for use or sale. there is an intention to complete and use or sell it. there is an ability to use or sell it. it will generate probable future economic benefits. there are available technical, financial and other resources to complete the development and to use or

sell the asset. the expenditure attributable to the asset during its development can be measured reliably.

Intangible assets are carried at cost less any accumulated amortisation and any impairment losses.

The amortisation period and the amortisation method for intangible assets are reviewed every period-end.

Reassessing the useful life of an intangible asset with a definite useful life after it was classified as indefinite is an indicator that the asset may be impaired. As a result the asset is tested for impairment and the remaining carrying amount is amortised over its useful life.

Internally generated brands, mastheads, publishing titles, customer lists and items similar in substance are not recognised as intangible assets.

Amortisation is provided to write down the intangible assets, on a straight line basis, to zero as follows:

Item Useful life Patents, trademarks and other rights 5 years Computer software, internally generated 5 years Intangible assets 5 years

25


Accounting Policies

1.5 Investments in subsidiaries

Group annual financial statements

The group annual financial statements include those of the holding company and its subsidiaries. The results of the subsidiaries are included from the effective date of acquisition. The purchase method of accounting is used to account for the acquisition of subsidiaries by the group.

On acquisition the group recognises the subsidiary’s identifiable assets, liabilities and contingent liabilities at fair value, except for assets classified as held-for-sale, which are recognised at fair value less costs to sell.

Company annual financial statements

In the company’s separate annual financial statements, investments in subsidiaries are carried at cost less any accumulated impairment.

The cost of an investment in a subsidiary is the aggregate of: the fair value, at the date of exchange, of assets given, liabilities incurred or assumed, and equity

instruments issued by the company; plus any costs directly attributable to the purchase of the subsidiary.

1.6 Financial instruments

Initial recognition

The group classifies financial instruments, or their component parts, on initial recognition as a financial asset, a financial liability or an equity instrument in accordance with the substance of the contractual arrangement.

Financial assets and financial liabilities are recognised on the group's balance sheet when the group becomes party to the contractual provisions of the instrument.

Loans to (from) group companies

These include loans to subsidiaries and are recognised initially at fair value plus direct transaction costs.

Subsequently these loans are measured at amortised cost using the effective interest rate method, less any impairment loss recognised to reflect irrecoverable amounts.

On loans receivable an impairment loss is recognised in profit or loss when there is objective evidence that it is impaired. The impairment is measured as the difference between the investment’s carrying amount and the present value of estimated future cash flows discounted at the effective interest rate computed at initial recognition.

Impairment losses are reversed in subsequent periods when an increase in the investment’s recoverable amount can be related objectively to an event occurring after the impairment was recognised, subject to the

26


Accounting Policies

1.6 Financial instruments (continued)

restriction that the carrying amount of the investment at the date the impairment is reversed shall not exceed what the amortised cost would have been had the impairment not been recognised.

Loans to (from) group companies are classified as loans and receivables.

Loans to (from) shareholders, directors, managers and employees

These financial assets are initially recognised at fair value plus direct transaction costs.

Subsequently these loans are measured at amortised cost using the effective interest rate method, less any impairment loss recognised to reflect irrecoverable amounts.

On loans receivable an impairment loss is recognised in profit or loss when there is objective evidence that it is impaired. The impairment is measured as the difference between the investment’s carrying amount and the present value of estimated future cash flows discounted at the effective interest rate computed at initial recognition.

Impairment losses are reversed in subsequent periods when an increase in the investment’s recoverable amount can be related objectively to an event occurring after the impairment was recognised, subject to the restriction that the carrying amount of the investment at the date the impairment is reversed shall not exceed what the amortised cost would have been had the impairment not been recognised.

Trade and other receivables

Trade receivables are measured at initial recognition at fair value, and are subsequently measured at amortised cost using the effective interest rate method. Appropriate allowances for estimated irrecoverable amounts are recognised in profit or loss when there is objective evidence that the asset is impaired. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payments (more than 30 days overdue) are considered indicators that the trade receivable is impaired. The allowance recognised is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at the effective interest rate computed at initial recognition.

The carrying amount of the asset is reduced through the use of an allowance account, and the amount of the loss is recognised in the income statement within operating expenses. When a trade receivable is uncollectible, it is written off against the allowance account for trade receivables. Subsequent recoveries of amounts previously written off are credited against operating expenses in the income statement. In the current year an allowance account wasn't used. All bad debts were written off directly.

Trade and other receivables are classified as loans and receivables.

Trade and other payables

Trade payables are initially measured at fair value, and are subsequently measured at amortised cost, using the effective interest rate method.

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and demand deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value. These are initially and subsequently recorded at fair value.

Bank overdraft and borrowings

Bank overdrafts and borrowings are initially measured at fair value, and are subsequently measured at amortised cost, using the effective interest rate method. Any difference between the proceeds (net of

27


Accounting Policies

1.6 Financial instruments (continued)

transaction costs) and the settlement or redemption of borrowings is recognised over the term of the borrowings in accordance with the group’s accounting policy for borrowing costs.

Other financial liabilities are measured initially at fair value and subsequently at amortised cost, using the effective interest rate method.

Other loans and receivables

Other financial assets classified as loans and receivables are initially recognised at fair value plus transaction costs, and are subsequently carried at amortised cost less any accumulated impairment.

These financial assets are not quoted in an active market and have fixed or determinable payments.

1.7 Tax

Current tax assets and liabilities

Current tax for current and prior periods is, to the extent unpaid, recognised as a liability. If the amount already paid in respect of current and prior periods exceeds the amount due for those periods, the excess is recognised as an asset.

Current tax liabilities (assets) for the current and prior periods are measured at the amount expected to be paid to (recovered from) the tax authorities, using the tax rates (and tax laws) that have been enacted or substantively enacted by the balance sheet date.

Deferred tax assets and liabilities

A deferred tax liability is recognised for all taxable temporary differences, except to the extent that thedeferred tax liability arises from: the initial recognition of goodwill; or the initial recognition of an asset or liability in a transaction which:

- is not a business combination; and - at the time of the transaction, affects neither accounting profit nor taxable profit (tax loss).

A deferred tax liability is recognised for all taxable temporary differences associated with investments insubsidiaries, branches and associates, and interests in joint ventures, except to the extent that both of thefollowing conditions are satisfied: the parent, investor or venturer is able to control the timing of the reversal of the temporary difference;

and it is probable that the temporary difference will not reverse in the foreseeable future.

A deferred tax asset is recognised for all deductible temporary differences to the extent that it is probablethat taxable profit will be available against which the deductible temporary difference can be utilised, unlessthe deferred tax asset arises from the initial recognition of an asset or liability in a transaction that: is not a business combination; and at the time of the transaction, affects neither accounting profit nor taxable profit (tax loss).

A deferred tax asset is recognised for all deductible temporary differences arising from investments insubsidiaries, branches and associates, and interests in joint ventures, to the extent that it is probable that: the temporary difference will reverse in the foreseeable future; and taxable profit will be available against which the temporary difference can be utilised.

A deferred tax asset is recognised for the carry forward of unused tax losses and unused STC credits to the extent that it is probable that future taxable profit will be available against which the unused tax losses and unused STC credits can be utilised.

28


Accounting Policies

1.7 Tax (continued)

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by the balance sheet date.

Tax expenses

Current and deferred taxes are recognised as income or an expense and included in profit or loss for theperiod, except to the extent that the tax arises from: a transaction or event which is recognised, in the same or a different period, directly in equity, or a business combination.

Current tax and deferred taxes are charged or credited directly to equity if the tax relates to items that are credited or charged, in the same or a different period, directly to equity.

1.8 Leases

A lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership. A lease is classified as an operating lease if it does not transfer substantially all the risks and rewards incidental to ownership.

Finance leases – lessee

Finance leases are recognised as assets and liabilities in the balance sheet at amounts equal to the fair value of the leased property or, if lower, the present value of the minimum lease payments. The corresponding liability to the lessor is included in the balance sheet as a finance lease obligation.

The discount rate used in calculating the present value of the minimum lease payments is the rate implicit in the lease.

The lease payments are apportioned between the finance charge and reduction of the outstanding liability. The finance charge is allocated to each period during the lease term so as to produce a constant periodic rate of return on the remaining balance of the liability.

Operating leases – lessee

Operating lease payments are recognised as an expense on a straight-line basis over the lease term. The difference between the amounts recognised as an expense and the contractual payments are recognised as an operating lease liability. This liability is not discounted.

Any contingent rents are expensed in the period they are incurred.

1.9 Inventories

Inventories are measured at the lower of cost and net realisable value on the first-in-first-out basis.

Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale.

The cost of inventories comprises of all costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and condition.

The cost of inventories of items that are not ordinarily interchangeable and goods or services produced and segregated for specific projects is assigned using specific identification of the individual costs.

The cost of inventories is assigned using the first-in, first-out (FIFO) formula. The same cost formula is used for all inventories having a similar nature and use to the entity.

29


Accounting Policies

1.9 Inventories (continued)

When inventories are sold, the carrying amount of those inventories are recognised as an expense in the period in which the related revenue is recognised. The amount of any write-down of inventories to net realisable value and all losses of inventories are recognised as an expense in the period the write-down or loss occurs. The amount of any reversal of any write-down of inventories, arising from an increase in net realisable value, are recognised as a reduction in the amount of inventories recognised as an expense in the period in which the reversal occurs.

1.10 Impairment of assets

The group assesses at each balance sheet date whether there is any indication that an asset may be impaired. If any such indication exists, the group estimates the recoverable amount of the asset.

If there is any indication that an asset may be impaired, the recoverable amount is estimated for the individual asset. If it is not possible to estimate the recoverable amount of the individual asset, the recoverable amount of the cash-generating unit to which the asset belongs is determined.

The recoverable amount of an asset or a cash-generating unit is the higher of its fair value less costs to sell and its value in use.

If the recoverable amount of an asset is less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. That reduction is an impairment loss.

An impairment loss of assets carried at cost less any accumulated depreciation or amortisation is recognised immediately in profit or loss. Any impairment loss of a revalued asset is treated as a revaluation decrease.

Goodwill acquired in a business combination is, from the acquisition date, allocated to each of the cash-generating units, or groups of cash-generating units, that are expected to benefit from the synergies of the combination.

An impairment loss is recognised for cash-generating units if the recoverable amount of the unit is lessthan the carrying amount of the units. The impairment loss is allocated to reduce the carrying amount of theassets of the unit in the following order: first, to reduce the carrying amount of any goodwill allocated to the cash-generating unit and then, to the other assets of the unit, pro rata on the basis of the carrying amount of each asset in the

unit.

An entity assesses at each reporting date whether there is any indication that an impairment loss recognised in prior periods for assets other than goodwill may no longer exist or may have decreased. If any such indication exists, the recoverable amounts of those assets are estimated.

The increased carrying amount of an asset other than goodwill attributable to a reversal of an impairment loss does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in prior periods.

A reversal of an impairment loss of assets carried at cost less accumulated depreciation or amortisation other than goodwill is recognised immediately in profit or loss. Any reversal of an impairment loss of a revalued asset is treated as a revaluation increase.

30


Accounting Policies

1.11 Share capital and equity

An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities.

1.12 Share based payments

Goods or services received or acquired in a share-based payment transaction are recognised when the goods or as the services are received. A corresponding increase in equity is recognised if the goods or services were received in an equity-settled share-based payment transaction or a liability if the goods or services were acquired in a cash-settled share-based payment transaction.

When the goods or services received or acquired in a share-based payment transaction do not qualify for recognition as assets, they are recognised as expenses.

For equity-settled share-based payment transactions, the goods or services received are measured, and the corresponding increase in equity, directly, at the fair value of the goods or services received, unless that fair value cannot be estimated reliably.

If the fair value of the goods or services received cannot be estimated reliably, their value and the corresponding increase in equity, indirectly, are measured by reference to the fair value of the equity instruments granted.

For cash-settled share-based payment transactions, the goods or services acquired and the liability incurred are measured at the fair value of the liability. Until the liability is settled, the fair value of the liability is re-measured at each reporting date and at the date of settlement, with any changes in fair value recognised in profit or loss for the period.

If the share based payments granted do not vest until the counterparty completes a specified period of service, the group accounts for those services as they are rendered by the counterparty during the vesting period, (or on a straight line basis over the vesting period).

If the share based payments vest immediately the services received are recognised in full.

For share-based payment transactions in which the terms of the arrangement provide either the entity or the counterparty with the choice of whether the entity settles the transaction in cash (or other assets) or by issuing equity instruments, the components of that transaction are recorded, as a cash-settled share-based payment transaction if, and to the extent that, a liability to settle in cash or other assets has been incurred, or as an equity-settled share-based payment transaction if, and to the extent that, no such liability has been incurred.

1.13 Employee benefits

Short-term employee benefits

The cost of short-term employee benefits, (those payable within 12 months after the service is rendered, such as paid vacation leave and sick leave, bonuses, and non-monetary benefits such as medical care), are recognised in the period in which the service is rendered and are not discounted.

The expected cost of compensated absences is recognised as an expense as the employees render services that increase their entitlement or, in the case of non-accumulating absences, when the absence occurs.

The expected cost of profit sharing and bonus payments is recognised as an expense when there is a legal or constructive obligation to make such payments as a result of past performance.

1.14 Provisions and contingencies

31


Accounting Policies

1.14 Provisions and contingencies (continued)

Provisions are recognised when: the group has a present obligation as a result of a past event; it is probable that an outflow of resources embodying economic benefits will be required to settle the

obligation; and a reliable estimate can be made of the obligation.

The amount of a provision is the present value of the expenditure expected to be required to settle the obligation.

Where some or all of the expenditure required to settle a provision is expected to be reimbursed by another party, the reimbursement shall be recognised when, and only when, it is virtually certain that reimbursement will be received if the entity settles the obligation. The reimbursement shall be treated as a separate asset. The amount recognised for the reimbursement shall not exceed the amount of the provision.

Provisions are not recognised for future operating losses.

If an entity has a contract that is onerous, the present obligation under the contract shall be recognised and measured as a provision.

A constructive obligation to restructure arises only when an entity: has a detailed formal plan for the restructuring, identifying at least:

- the business or part of a business concerned; - the principal locations affected; - the location, function, and approximate number of employees who will be compensated for terminating their services; - the expenditures that will be undertaken; and - when the plan will be implemented; and

has raised a valid expectation in those affected that it will carry out the restructuring by starting to implement that plan or announcing its main features to those affected by it.

After their initial recognition contingent liabilities recognised in business combinations that are recognisedseparately are subsequently measured at the higher of: the amount that would be recognised as a provision; and the amount initially recognised less cumulative amortisation.

Contingent assets and contingent liabilities are not recognised. Contingencies are disclosed in note .

1.15 Revenue

Revenue from the sale of goods is recognised when all the following conditions have been satisfied: the group has transferred to the buyer the significant risks and rewards of ownership of the goods; the group retains neither continuing managerial involvement to the degree usually associated with

ownership nor effective control over the goods sold; the amount of revenue can be measured reliably; it is probable that the economic benefits associated with the transaction will flow to the group; and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

32


Accounting Policies

1.15 Revenue (continued)

When the outcome of a transaction involving the rendering of services can be estimated reliably, revenueassociated with the transaction is recognised by reference to the stage of completion of the transaction atthe balance sheet date. The outcome of a transaction can be estimated reliably when all the followingconditions are satisfied: the amount of revenue can be measured reliably; it is probable that the economic benefits associated with the transaction will flow to the group; the stage of completion of the transaction at the balance sheet date can be measured reliably; and the costs incurred for the transaction and the costs to complete the transaction can be measured

reliably.

When the outcome of the transaction involving the rendering of services cannot be estimated reliably,revenue shall be recognised only to the extent of the expenses recognised that are recoverable.

Service revenue is recognised by reference to the stage of completion of the transaction at balance sheetdate. Stage of completion is determined by services performed to date as a percentage of total services to be performed.

Contract revenue comprises: the initial amount of revenue agreed in the contract; and variations in contract work, claims and incentive payments:

- to the extent that it is probable that they will result in revenue; and - they are capable of being reliably measured.

Revenue is measured at the fair value of the consideration received or receivable and represents the amounts receivable for goods and services provided in the normal course of business, net of trade discounts and settlement discounts, and value added tax.

Interest is recognised, in profit or loss, using the effective interest rate method.

Royalties are recognised on the accrual basis in accordance with the substance of the relevant agreements.

Dividends are recognised, in profit or loss, when the company’s right to receive payment has been established.

Service fees included in the price of the product are recognised as revenue over the period during which the service is performed.

1.16 Turnover

Turnover comprises of sales to customers and service rendered to customers. Turnover is stated at the invoice amount and is exclusive of value added taxation.

1.17 Borrowing costs

Borrowing costs are recognised as an expense in the period in which they are incurred.

33


Accounting Policies

1.18 Translation of foreign currencies

Foreign currency transactions

A foreign currency transaction is recorded, on initial recognition in Rands, by applying to the foreign currency amount the spot exchange rate between the functional currency and the foreign currency at the date of the transaction.

At each balance sheet date: foreign currency monetary items are translated using the closing rate; non-monetary items that are measured in terms of historical cost in a foreign currency are translated

using the exchange rate at the date of the transaction; and non-monetary items that are measured at fair value in a foreign currency are translated using the

exchange rates at the date when the fair value was determined.

Exchange differences arising on the settlement of monetary items or on translating monetary items at rates different from those at which they were translated on initial recognition during the period or in previous annual financial statements are recognised in profit or loss in the period in which they arise.

When a gain or loss on a non-monetary item is recognised directly in equity, any exchange component of that gain or loss is recognised directly in equity. When a gain or loss on a non-monetary item is recognised in profit or loss, any exchange component of that gain or loss is recognised in profit or loss.

Cash flows arising from transactions in a foreign currency are recorded in Rands by applying to the foreign currency amount the exchange rate between the Rand and the foreign currency at the date of the cash flow.

1.19 Consolidations

(a) Subsidiaries Subsidiaries are all entities (including special purpose entities) over which the group has the power to govern the financial and operating policies generally accompanying a shareholding of more than one half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the group controls another entity. Subsidiaries are fully consolidated from the date on which control is transferred to the group. They are de-consolidated from the date that control ceases. The purchase method of accounting is used to account for the acquisition of subsidiaries by the group. The cost of an acquisition is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the acquisition. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date, irrespective of the extent of any minority interest. The excess of the cost of acquisition over the fair value of the group’s share of the identifiable net assets acquired is recorded as goodwill. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognised directly in the income statement. Inter-company transactions, balances and unrealised gains on transactions between group companies are eliminated. Unrealised losses are also eliminated but considered an impairment indicator of the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the group.

34


Accounting Policies

1.20 Segment reporting

The group's primary segments are business segments that are engaged in providing products or services. The group policy is to disclose mandatory segmental information under IAS 14 Segment Reporting and to disclose additional supplemental information for each business segment at the group’s discretion. The group does not have a secondary segment basis, as no geographical locations of the group's activities have been identified. The accounting policies of the group's reported segments are the same as the accounting policies of the group. Assets, liabilities, revenues or expenses that are not directly attributable to a particular segment are allocated between segments where there is a reasonable basis for doing so. Inter-segmental transfers are made on an arm's length basis.

35


Notes to the Annual Financial Statements

Figures in Rand 2008 2007 2008 2007 Group Company

2. Changes in accounting policy

Adoption of standards and interpretations effective in 2008 The following standards have been applied by the Group from 1 May 2007: • IFRS 7 Financial Instruments: Disclosure. • IAS 1 (Amendment) Capital Disclosures. The application of IFRS 7 and IAS 1 (Amendment) in the year ended 30 April 2008 have not affected the amounts recognized in the balance sheet or income statement as the standards are concerned with disclosure only. Certain comparative information has, however, been restated in order to achieve compliance with the disclosure requirements set out in these standards. Standards and interpretations effective in 2008 but not relevant The following amendment was mandatory for accounting periods beginning on or after 1 May 2007 but is not relevant to the operations of the Group. • IFRIC 11 IFRS 2 – Group and Treasury Share Transactions

3. Statements and interpretations not yet effective

The following IFRS was available for early application but has not yet been applied by the company in these financial statements: • IFRS 8 Operating Segments for years commencing on or after 1 January 2009. • IFRIC 12 Service Concession Arrangements for years commencing on or after 1 January 2008 • IFRIC 13 Customer Loyalty Programmes for years commencing on or after 1 July 2008 • IFRS 3 revised Business Combinations and IAS 27 Consolidated and Separate Financial Statement for business combinations occurring in annual periods beginning on or after 1 July 2009. • IAS 1 revised Presentation of Financial Statements for years commencing on or after 1 January 2009. • IAS 23 revised – Borrowing Costs for years commencing on or after 1 January 2009. • IFRIC 14 – The Limit on a Defined Benefit Asset, minimum funding requirements and their interaction for years commencing on or after 1 January 2008. • IAS 28 Investments in Associates for years commencing on or after 1 July 2009. • IAS 31 Interests in Joint Ventures for years commencing on or after 1 July 2009. • IFRS 2 Share-based Payment for years commencing on or after 1 January 2009. The application of IFRS 8 in the year ended 30 April 2008 would not have affected the balance sheet or income statement as the standard is concerned only with disclosure. Management is in the process of assessing the impact of these amendments and standards on the reported results of the company.

36



4. Property, pant and equipment

GROUP

2008 2007

Cost / Valuation

Accumulated depreciation

Carrying value Cost / Valuation

Accumulated depreciation

Carrying value

Furniture and fixtures 95 179 (60 522) 34 657 79 856 (51 568) 28 288 Motor vehicles 279 354 (110 578) 168 776 279 354 (40 739) 238 615 Office equipment 16 359 (12 250) 4 109 14 605 (10 817) 3 788 IT equipment 225 048 (222 655) 2 393 225 048 (180 279) 44 769 Computer software 1 520 566 (1 332 556) 188 010 1 520 566 (1 238 550) 282 016

Total 2 136 506 (1 738 561) 397 945 2 119 429 (1 521 953) 597 476

Reconciliation of property, plant and equipment – 2008

Opening Balance

Additions Depreciation Total

Furniture and fixtures 28 288 15 322 (8 953) 34 657 Motor vehicles 238 615 - (69 839) 168 776 Office equipment 3 788 1 754 (1 433) 4 109 IT equipment 44 769 - (42 376) 2 393 Computer software 282 016 - (94 006) 188 010

597 476 17 076 (216 607) 397 945

Reconciliation of property, plant and equipment - 2007

Opening Balance

Additions Depreciation Total

Furniture and fixtures 23 976 19 303 (14 991) 28 288 Motor vehicles - 279 354 (40 739) 238 615 Office equipment 3 651 2 631 (2 494) 3 788 IT equipment 62 936 1 195 (19 362) 44 769 Computer software 803 231 5 263 (526 478) 282 016

893 794 307 746 (604 064) 597 476

Carrying value of assets pledged as security:

Motor vehicles 168 776 238 615 - - The motor vehicles is pledged assecurity over finance leases ofR230,798 (2007: R287,866). Referto note 17.

Assets subject to finance lease (Net carrying amount)

Motor vehicles 168 776 238 615 - -

37



5. Intangible assets

GROUP

2008 2007

Cost / Valuation

Accumulated amortisation



Carrying value

Patents, trademarks andother rights

5 922 957 (1 184 591) 4 738 366 5 922 957 (5 922 957) -

Computer software,internally generated

4 061 211 (3 429 120) 632 091 4 061 211 (2 870 717) 1 190 494

Customer contracts -BEE agreement

8 170 000 (1 634 000) 6 536 000 - - -

Total 18 154 168 (6 247 711) 11 906 457 9 984 168 (8 793 674) 1 190 494

COMPANY

2008 2007

Cost / Valuation




Carrying value

Patents, trademarks andother rights

5 922 957 (1 184 591) 4 738 366 5 922 957 (5 922 957) -

Customer contracts -BEE agreement

8 170 000 (1 634 000) 6 536 000 - - -

Total 14 092 957 (2 818 591) 11 274 366 5 922 957 (5 922 957) -

Reconciliation of intangible assets - 2008

Opening Balance

Additions Amortisation Impairment reversal

Total

Patents, trademarks and other rights

- - (1 184 591) 5 922 957 4 738 366

Computer software, internally generated

1 190 494 - (558 403) - 632 091

Customer contracts - BEE agreement

- 8 170 000 (1 634 000) - 6 536 000

1 190 494 8 170 000 (3 376 994) 5 922 957 11 906 457

Reconciliation of intangible assets - 2007

Opening Balance

Disposals Amortisation Impairment loss

Total


5 922 957 - - (5 922 957) -

Computer software, internally generated

1 945 366 (5 262) (749 610) - 1 190 494

7 868 323 (5 262) (749 610) (5 922 957) 1 190 494

38



Reconciliation of intangible assets - Company - 2008

Opening Balance

Additions Amortisation Impairment reversal

Total


- - (1 184 591) 5 922 957 4 738 366

Customer contracts - BEE agreement

- 8 170 000 (1 634 000) - 6 536 000

- 8 170 000 (2 818 591) 5 922 957 11 274 366

Reconciliation of intangible assets - Company - 2007

Opening Balance

Impairment loss

Total

Patents, trademarks and other rights 5 922 957 (5 922 957) -

Pledged as security

Carrying value of intangible assets pledged as security:

Intellectual property - Mobile point of sale device and Time and attendance unit

4 738 365 - 4 738 365 -

Used to secure borrowings granted to the group by Industrial Development Corporation (IDC) of R 2 155 599 (2007: R 2 470 440). Refer to note 15.

Details of valuation

The effective date of the valuation was 08 April 2008. Revaluations were performed by an independent valuer, Mr V Fuch CA(SA), Knowledge Upgrade CC.

In accordance with a BEE agreement signed in the current financial year, by the company, they were awarded a schools project which commenced in April 2008. This project provided the company with a future profit forecast and enabled them to reverse the impairment loss of the intellectual property of R5,922,957 which was impaired in the prior year. A Customer Contract intangible asset for the BEE transaction of R8,170,000 was also raised in the current year. For intangible assets, totalling R 14 092 956, where there was a lack of comparable market data, the fair value less cost to sell could not be determined. The value in use for the cash generating unit MobileBio business segment was used to determine the recoverable amount of these intangible assets as the recoverable amount for these assets could not be determined separately. The value in use was based on the discounted cash flow for this cash generating unit. The following assumptions were used: Discount rate 18.13%. These assumptions are based on current market conditions. These intangible assets belong to the MobileBio operating segment.

6. Investments in subsidiaries NN

Held by % holding

2008

% holding

2007

Carrying amount 2008

Carrying amount 2007

Beget Solutions (Pty) Ltd Beget Holdings Ltd 100.00% 100.00% 1 500 000 1 500 000 Beget Interactive (Pty) Ltd Beget Holdings Ltd 33.00% 33.00% 33 33 Beget Interactive (Pty) Ltd Beget Solutions (Pty) Ltd 67.00% 67.00% - - Smartcast (Pty) Ltd Beget Holdings Ltd 100.00% 100.00% - -

39



Beget Connect (Pty) Ltd Beget Solutions (Pty) Ltd 100.00% 100.00% - - Beget International (Pty) Ltd Beget Solutions (Pty) Ltd 100.00% 100.00% - - Beget SMSolutions (Pty) Ltd Beget Solutions (Pty) Ltd 100.00% 100.00% - - Beget Dynamics (Pty) Ltd Beget Interactive (Pty) Ltd 100.00% 100.00% - - Beget NQS (Pty) Ltd Beget Interactive (Pty) Ltd 100.00% 100.00% - -

1 500 033 1 500 033

The carrying amounts of subsidiaries are shown net of impairment losses.

7. Loans to (from) group companies

Subsidiaries

Beget Solutions (Pty) Ltd This loan is unsecured, bears nointerest and is payable on demand.

- - 1 169 718 1 652 763

Fair value of loans to and from group companies

Loans to group companies - - 1 169 718 1 652 763

Loans to group companies past due but not impaired

None of the loans to group companies are past due.

Loans to group companies impaired

None of the loans to group companies were impaired.

8. Loans to (from) shareholders

Beacham Capital Ltd The loan bears no interest, but anamount of R500 per mobilebio unitsold is payable to Beacham CapitalLimited for the first 5000 units sold.As at year-end, the group has notsold 5000 units yet.

(454 427) (1 140 000) - -

AH Potgieter (Jnr) The loan is unsecured, bearsinterest at prime plus 2% and hasno fixed terms of repayment

(235 462) (240 513) - -

DE Hawkins The loan is unsecured, bearsinterest at prime plus 2% and hasno fixed terms of repayment

(114 951) (97 859) - -

DB Harrington The loan is unsecured, bears nointerest and is payable on demand.

(35 000) (35 000) - -

CJ van Coller The loan is unsecured, bears nointerest and is payable on demand.

(42 500) (42 500) - -

JS Coetzee The loan is unsecured, bearsinterest at prime plus 2% and has

(776 909) (714 893) - -

40



no fixed terms of repayment AH Potgieter The loan is unsecured, bearsinterest at prime plus 2% and hasno fixed terms of repayment

(546 691) (548 140) - -

Other shareholders - (5 592) - - P Smuts - 74 150 - -

(2 205 940) (2 750 347) - -

There were no defaults or breaches to any of these loan agreements.

Non-current assets - 74 150 - - Non-current liabilities (2 205 940) (2 824 497) - -

(2 205 940) (2 750 347) - -

Fair value of loans to and from shareholders

Loans to shareholders - 74 150 - - Loans from shareholders (2 205 513) (2 824 497) - -

9. Financial assets by category

The accounting policies for financial instruments have been applied to the line items below:

2008

Loans and

receivables Fair value

through profit or loss

- held for trading

Fair value through

profit or loss - designated

Held to maturity

Available for sale

Trade and other receivables 6 248 147 - - - - Cash and cash equivalents 99 676 - - - -

6 347 823 - - - -

2007

Loans and receivables

Fair value through profit or loss - held

for trading

Fair value through profit

or loss - designated

Held to maturity

Available for sale

Loans to shareholders 74 150 - - - - Trade and otherreceivables 972 703 - - - - Cash and cashequivalents 99 473 - - - -

1 146 326 - - - -

41



Company - 2008



for trading



Held to maturity

Available for sale

Loans to group companies 1 169 718 - - - - Cash and cash equivalents 99 659 - - - -

1 269 377 - - - -

Company - 2007



for trading



Held to maturity

Available for sale

Loans to group companies 1 652 763 - - - - Trade and other receivables 67 573 - - - - Cash and cash equivalents 98 849 - - - -

1 819 185 - - - -

10. Deferred tax

Deferred tax asset

Tax losses available for set offagainst future taxable income

4 414 517 - 1 274 580 -

Deferred tax on provision liability 93 066 - - - Amortisation on intangible assets (176 986) - - - Operating lease accrual (53 891) - - -

4 276 706 - 1 274 580 -

Reconciliation of deferred tax asset (liability)

Tax losses available for set offagainst future taxable income

4 414 517 - 1 274 580 -

Originating permanent differenceon amortisation of intangible assets

(176 986) - - -

Originating temporary difference onprovision liability

93 066 - - -

Originating temporary difference onoperating lease accrual

(53 891) - - -

4 276 706 - 1 274 580 -

Recognition of deferred tax asset

42



11. Inventories

Work in progress 1 419 661 829 581 - - Finished goods 85 340 197 380 - -

Subtotal

1 505 001

1 026 961

-

- Inventories (write-downs) (98 474) - - -

1 406 527 1 026 961 - -

Carrying value of inventoriescarried at cost price.

1 406 527 1 026 961 - -

12. Trade and other receivables

Trade receivables 6 113 595 760 917 - - Deposits 134 552 144 213 - -

6 248 147 905 130 - -

Trade and other receivables pledged as security

Trade receivables are ceded to the Industrial Development Corporation for borrowings to the value of R2,155,543 (2007: R2,470,440). Refer to note 15.

Fair value of trade and other receivables

Trade and other receivables 6 248 147 972 703 - 67 573

Trade and other receivables past due but not impaired

Trade and other receivables which are less than 3 months past due are not considered to be impaired. At 30 April 2008, R 1 629 122 (2007: R 433 624) were past due but not impaired.

The ageing of amounts past due but not impaired is as follows:

1 month past due 724 255 103 984 - - 2 months past due 98 654 11 781 - - 3 months past due 806 213 317 859 - -

Trade and other receivables impaired

As of 30 April 2008, trade and other receivables of R 1 159 649 (2007: R 192 230) were impaired.

The amount of the provision was R - as of 30 April 2008 (2007: R 516 351). No provision for impairment on debtors was raised in the current year, as all doubtful as well as bad debts were written off against the debtor's account.

The ageing of these loans is as follows:

Over 6 months - 516 351 - -

43



Reconciliation of provision for impairment of trade and other receivables

Opening balance 516 352 324 122 - - Provision for impairment - 192 230 - - Amounts written off as uncollectible (516 352) - - -

- 516 352 - -

The creation and release of provision for impaired receivables have been included in operating expenses in the income statement. Amounts charged to the allowance account are generally written off when there is no expectation of recovering additional cash.

13. Cash and cash equivalents

Cash and cash equivalents consist of:

Cash on hand 17 624 - - Short-term deposits 99 659 98 849 99 659 98 849 Bank overdraft (812 270) (832 636) (101 787) (102 966)

(712 594) (733 163) (2 128) (4 117)

Current assets 99 676 99 473 99 659 98 849 Current liabilities (812 270) (832 636) (101 787) (102 966)

(712 594) (733 163) (2 128) (4 117)

Cession in the amount of R100,000 in favour of the bank by Beget Holdings Limited of any rights in and to its call deposit held at FNB. Letters of surety and cession of credit balances were pledged as security for overdraft facilities of R555,000 (2007: R600,000) by key management and associates of key management. Refer to note 34.

14. Share capital

Authorised 1,000,000,000 Ordinary shares of0.0002 cents each

2 000 2 000 2 000 2 000

Reconciliation of number of shares issued:

Reported as at 01 May 2007 556 958 811 481 892 144 556 958 811 481 892 144 Issue of shares – ordinary shares 205 921 681 75 066 667 205 921 681 75 066 667

762 880 492 556 958 811 762 880 492 556 958 811

237 119 508 un-issued ordinary shares are under the control of the directors in terms of a resolution of members passed at the last annual general meeting. This authority remains in force until the next annual general meeting.

44



Issued Ordinary 1 526 1 114 1 526 1 114 Share premium 35 943 859 27 795 271 35 943 859 27 795 271 Share issue costs written off against share premium

(228 000) (171 000) (228 000) (171 000)

35 717 385 27 625 385 35 717 385 27 625 385

During the period the following share issues were made: - 204,250,000 at 4 cents per share - 1,671,681 at 8.97 cents per share Costs related to the above share issues of R228,000 (2007: R171,000), were charged against the share premium. The following share options were granted to Beacham Capital Limited in a previous financial year: - 80,000,000 shares at 18 cents per share exercisable on 31 August 2008

15. Share based payments

Share based payments during the year

204 250 000 shares were issued at 4 cents per share, on 18 January 2008, to SMM Telematics (Pty) Ltd in accordance with a BEE transaction. Through the transaction, the company has been awarded a schools project which commenced in April 2008. An intangible asset was raised to the value of R8,170,000 which will be written off over the period of the schools project. There was also an issue of shares to Stanley Cecil Harris, on 31 July 2007, to repay outstanding debt of R150,000. 1 671 681 shares were issued at 8.97 cents per share.

Fair value of goods and services received

The fair value of the intangible assets raised could not be established as their is no market for the specific goods or services. The fair value was therefore calculated using the fair value of the shares issued on the issuing date.

In the payment of debt, the fair value of amount owing of R150,000 was used.

16. Other financial liabilities

Held at amortised cost Industrial Development Corproration (IDC) loanThe loan from IDC is secured by shareholders as well as by Beget Holdings Ltd and all its subsidiaries. The loan bears interest at prime plus 5% and a repayment plan of 15 to 18 months after year-end is currently being negotiated. Trade receivables, refer note 12 (except for debtors pledged as security for overdraft facilities, refer note 13), have been ceded to IDC as security for the loan.

2 155 599 2 470 440 - -

45



Baker Finance Ltd This loan is unsecured, bearsinterest at prime and is payable ondemand.

28 372 23 093 - -

Baker Finance Limited The loan is unsecured, bearsinterest at 5% per 45 days and ispayable on demand.

1 482 797 807 579 1 482 797 807 579

Loans from directors, managersand employees The loans are unsecured, bearinterest at prime plus 2% and arepayable within 12 months afteryear-end.

109 250 274 637 66 250 66 250

3 776 018 3 575 749 1 549 047 873 829

Current liabilities At amortised cost 3 776 018 3 575 749 1 549 047 873 829

17. Finance lease obligation

Minimum lease payments due - within one year 84 448 84 448 - - - in second to fifth year inclusive 204 082 295 566 - -

288 530

380 014

-

-

less: future finance charges (57 732) (92 148) - -

Present value of minimum leasepayments

230 798 287 866 - -

Present value of minimum lease payments due

- within one year 57 115 52 642 - - - in second to fifth year inclusive 173 683 235 224 - -

230 798 287 866 - -

Non-current liabilities 173 683 235 224 - - Current liabilities 57 115 52 642 - -

230 798 287 866 - -

The average lease term was 5 years, with an average monthly repayment amount of R7,037.32 (2007: R7,037.32) and the average effective borrowing rate was 13% (2007: 13%).

Interest rates are fixed at the contract date. All leases have fixed repayments and no arrangements have been entered into for contingent rent.

46



The group's obligations under finance leases are secured by the lessor's charge over the leased assets. Refer note 4. No defaults or breaches of loan terms or payments have taken place in either current or prior periods.

18. Deferred income

Deferred income consists of support and maintenance that is included in the contract when Mobilebio units are sold. The support and maintenance is deferred over the period stipulated in the contract which could be up to 48 months

Non-current liabilities 1 699 442 1 807 583 - - Current liabilities 1 311 316 928 606 - -

3 010 758 2 736 189 - -

19. Provisions

Reconciliation of provisions - 2008

Opening Balance

Additions Utilised during the

year

Total

Provision for future cost of SMS sales 735 583 194 749 (735 583) 194 749

Reconciliation of provisions - 2007

Opening Balance

Additions Utilised during the

year

Total

Provision for future cost of SMS sales 533 225 444 632 (242 274) 735 583

The timing of when the SMS’s will be used is uncertain as it is impossible to say when the general public will use the SMS’s. Currently the SMS’s do not expire after a term.

20. Trade and other payables

Trade payables 3 740 754 3 738 093 533 272 528 194 VAT 3 410 998 1 486 143 122 093 226 663 Accrued leave pay 137 631 137 631 - - Sundry accruals 245 618 30 106 - 3 440 Accrued PAYE, UIF, SDL, andsalaries

3 025 153 2 487 394 - -

Accrued operating lease expense 192 470 29 396 - -

10 752 624 7 908 763 655 365 758 297

21. Financial liabilities by category

The accounting policies for financial instruments have been applied to the line items below:

47



2008

Financial liabilities at amortised

cost


for trading



Total

Loans from shareholders 2 205 940 - - 2 205 940 Other financial liabilities 3 776 018 - - 3 776 018 Finance lease obligation 230 798 - - 230 798 Trade and other payables 7 011 525 - - 10 752 624 Bank overdraft 812 270 - - 812 270 Provisions 194 749 - - 194 749

17 972 399 - - 17 972 399

2007


cost


for trading



Total

Loans from shareholders 2 824 497 - - 2 824 497 Other financial liabilities 3 575 749 - - 3 575 749 Finance lease obligation 287 866 - - 287 866 Trade and other payables 6 255 593 - - 6 255 593 Bank overdraft 832 636 - - 832 636

13 776 341 - - 13 776 341

Company - 2008


cost


for trading



Total

Other financial liabilities 1 549 047 - - 1 549 047 Trade and other payables 533 272 - - 533 272 Bank overdraft 101 787 - - 101 787

2 184 106 - - 2 184 106

Company - 2007


cost


for trading



Total

Other financial liabilities 873 829 - - 873 829 Trade and other payables 51 653 - - 51 653 Bank overdraft 102 966 - - 102 966

1 028 448 - - 1 028 448

48



22. Revenue

Sale of goods 14 117 647 11 824 307 60 887 32 234 Rendering of services 2 124 476 1 453 058 426 000 390 500 Royalty income 7 200 000 - - -

23 442 123 13 277 365 486 887 422 734

23. Cost of sales

Sale of goods Cost of goods sold 9 311 069 5 738 256 30 375 5 560

Rendering of services Cost of services 519 256 142 221 - -

9 830 325 5 880 477 30 375 5 560

24. Operating profit (loss)

Operating profit for the year is stated after accounting for the following:

Remuneration, other than to employees, for:

Consulting and management fees 284 254 511 277 - -

Operating lease charges - straight-lined

Premises Contractual amounts 1 027 722 742 078 - -

Profit on sale of property, plant andequipment

1 650 - - -

Impairment on intangible assets - 5 922 957 - 5 922 957 Reversal of impairment on intangible assets

5 922 957 - 5 922 957 -

Profit on exchange differences 248 512 158 162 243 232 153 338 Amortisation on intangible assets 3 376 994 749 610 2 818 591 - Depreciation on property, plant andequipment

216 607 604 064 - -

Employee costs 3 231 262 6 271 504 93 854 105 000 Impairment of obsolete stock 98 474 - - -

25. Investment revenue

Interest revenue Bank 9 577 5 031 9 195 4 815

49



26. Finance costs

Industry Development Corporationloan

385 158 307 178 - -

Trade and other payables 17 034 207 567 - 49 356 Finance leases 21 266 23 845 - - Bank 80 010 10 477 13 966 9 921 Baker Finance Ltd loan 431 987 668 201 431 987 668 201 Late payment of tax 731 670 259 460 11 000 21 261 Interest paid on directors loans 302 295 775 087 - -

1 969 420 2 251 815 456 953 748 739

27. Taxation

Major components of the tax income

Deferred Arising from previously unrecognised tax losses

(4 414 517) - (1 274 580) -

Provision liability (93 066) - - - Amortisation of intangible assets 176 986 - - - Operating lease accrual 53 891 - - -

(4 276 706) - (1 274 580) -

Reconciliation of the tax expense

Reconciliation between applicable tax rate and average effective tax rate.

Applicable tax rate 28.00% - % 28.00% - %

Non-taxable income (28.11)% - % (63.18)% - % Tax loss benefit increase 74.5% - % 61.82% - % Non-deductible expenses 9.74% - % 38.28% - % Allowable charges not included (7.32)% - % (3.10)% - %

- (72/19)%

- % - (61.82)%

- %

No provision has been made for 2008 tax as the group has an accumulated loss exceeding the profit made in the current year.

28. Auditors' remuneration

Fees 370 000 120 000 370 000 120 000 Other services 15 412 7 570 15 412 7 570

385 412 127 570 385 412 127 570

50



29. Income, expenses, gains and losses resulting from financial assets and liabilities

2008



cost

Available for sale financial

assets

Total

Interest income 9 577 - - 9 577 Interest expense - (1 969 420) - (1 969 420) Impairment losses (717 447) - - (717 447)

(707 870) (1 969 420) - (2 677 290)

2007



cost


assets

Total

Interest income 5 031 - - 5 031 Interest expense - (2 251 815) - (2 251 815) Impairment losses (398 623) - - (398 623)

(393 592) (2 251 815) - (2 645 407)

Company - 2008



cost


assets

Total

Interest income 9 195 - - 9 195 Interest expense - (456 953) - (456 953)

9 195 (456 953) - (447 758)

Company - 2007



cost


assets

Total

Interest income 4 815 - - 4 815 Interest expense - (748 739) - (748 739)

4 815 (748 739) - (743 924)

51



30. Cash generated from (used in) operations

Profit (loss) before taxation 5 923 621 (19 901 214) 2 061 451 (13 473 994) Adjustments for: Depreciation and amortisation 3 593 601 1 353 674 2 818 591 - Profit on sale of assets (1 650) - - - Interest received (9 577) (5 031) (9 195) (4 815) Finance costs 1 969 420 2 251 815 456 953 748 739 Impairment (reversals) loss (5 922 957) 11 352 899 (5 922 957) 11 869 384 Movements in provisions (540 834) 153 321 - - Changes in working capital: Inventories (379 566) 822 263 - - Trade and other receivables (5 275 444) 692 640 67 573 (40 454) Trade and other payables 2 993 861 2 754 442 47 068 (461 364) Deferred income 274 569 1 551 664 - -

2 625 044 1 026 473 (480 516) (1 362 504)

31. Tax refunded

Balance at beginning of the year (12 008) (12 008) (12 008) (12 008) Balance at end of the year 12 008 12 008 12 008 12 008

- - - -

32. Other non-cash transactions

204 250 000 shares were issued at 4 cents per share to SMM Telematics (Pty) Ltd in accordance with a BEE transaction. Through the transaction, the company has been awarded a schools project which commenced in April 2008. An intangible asset was raised to the value of R8,170,000 which will be written off over the period of the schools project.

There was also an issue of shares to Stanley Cecil Harris to repay outstanding debt of R150,000. 1 671 681 shares were issued at 8.97 cents per share.

33. Commitments

Operating leases – as lessee (expense)

Minimum lease payments due - within one year 892 430 811 300 - - - in second to fifth year inclusive 3 035 140 3 927 570 - -

3 927 570 4 738 870 - -

Operating lease payments represent rentals payable by the group for certain of its office properties. Leases are negotiated for an average term of seven years and rentals are fixed for an average of three years. No contingent rent is payable.

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34. Related parties `

Relationships Subsidiaries Beget Solutions (Pty) Ltd

Beget Dynamics (Pty) Ltd Beget Interactive(Pty) Ltd Beget Connect (Pty) Ltd Beget VPN (Pty) Ltd Beget SMsolutions (Pty) Ltd Beget International (Pty) Ltd Beget NQS (Pty) Ltd Smartcast (Pty) Ltd 6

Shareholder with significant influence SMM Telematics (Pty) Ltd Close family member of key management SM Potgieter Associate of close family member of key management Potty Family Trust

P Smuts D Smuts Johan & Elsie Trust P van Zyl KDH Enterprises

Members of key management AH Potgieter DE Hawkins AH Potgieter (jnr) T Mogashoa C van Coller

Related party balances

Loan accounts - Owing (to) by related parties Beget Solutions (Pty) Ltd 1 102 145 1 472 662 AH Potgieter (459 323) (548 140) JS Coetzee (651 706) (714 893) AH Potgieter (Jnr) (228 209) (240 513) C v Coller (42 500) (42 500) DE Hawkins (97 859) (97 859)

Amounts included in Trade receivable (Trade Payable) regarding related parties

SMM Telematics (Pty) Ltd 3 223 008 -

Related party transactions

Interest paid to (received from) related parties AH Potgieter 90 778 77 876 AH Potgieter (Jnr) 7 253 3 823 DE Hawkins 17 496 10 587 JS Coetzee 125 203 92 988

Purchases from (sales to) related parties Beget Solutions (Pty) Ltd - (32 233) SMM Telematics (Pty) Ltd (2 309 999) -

Royalty fees received from related parties

SMM Telematics (Pty) Ltd (7 200 000) -

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Administration fees paid to (received from) related parties Beget Solutions (Pty) Ltd (426 000) (390 500)

Consulting fees paid to (received from) related parties SM Potgieter 180 000 150 000 KDH Enterprises 60 000 60 000

35. Directors' emoluments

Executive

2008 Emoluments Total For services as directors 60 000 60 000 Basic salary 1 060 650 1 060 650

1 120 650 1 120 650

2007 Emoluments Total For services as directors 60 000 60 000 Basic salary 803 864 803 864

863 864 863 864

Non-executive

2008 Emoluments Total For services as directors 21 250 21 250

2007 Emoluments Total For services as directors 45 000 45 000

36. Prior period errors

The operating lease of the company's registered office building has been straight-lined. The accrued rent liability and rent expense for the prior year was adjusted.

An adjusting journal against accrued salaries was captured incorrectly in the prior year.

The correction of the errors results in adjustments as follows:

Balance sheet Trade and other payables -Accrued salaries

- (102 890) - -

Retained Income - 102 890 - - Trade and other payables -Accrued operating lease expense

- (29 396) - -

Income statement Operating lease expense - 29 396 - -

37. Comparative figures

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A short-term deposit, disclosed in the prior year with bank balances, was reclassified seperately. Accrued leave provision has also been reclassified according to IFRS from provisions to trade and other payables.

The effects of the reclassifications are as follows:

Balance sheet Cash and cash equivalents - 98 849 - - Bank Overdraft - (98 849) - - Provisions - 137 631 - - Accruals - (137 631) - -

38. Risk management

The group’s activities expose it to a variety of financial risks: market risk (including currency risk, fair value interest rate risk, cash flow interest rate risk and price risk), credit risk and liquidity risk.

The group’s overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the group’s financial performance. The board of directors provides principles for overall risk management, as well as policies covering specific areas, such as foreign exchange risk, interest rate risk, credit risk, and investment of excess liquidity.

Liquidity risk

The group’s risk to liquidity is a result of the funds available to cover future commitments. The group manages liquidity risk through an ongoing review of future commitments and credit facilities.

Cash flow forecasts are prepared and adequate utilised borrowing facilities are monitored.

The table below analyses the group’s financial liabilities into relevant maturity groupings based on the remaining period at the balance sheet to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows. Balances due within 12 months equal their carrying balances as the impact of discounting is not significant.

Group

At 30 April 2008

Less than 1 year

Between 2 and 5 years

Over 5 years

Borrowings 3 776 012 2 384 465 - - Trade and other payables 7 011 525 - - - Bank overdraft 812 270 - - - Finance lease obligation 84 448 204 082 - -

At 30 April 2007

Less than 1 year


Over 5 years

Borrowings 3 575 749 3 358 180 - - Trade and other payables 6 255 593 - - - Bank overdraft 832 636 - - - Finance lease obligation 84 448 295 566 - -

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Company

At 30 April 2008

Less than 1 year


Over 5 years

Borrowings 1 549 047 - - - Trade and other payables 533 272 - - - Bank overdraft 101 787 - - -

At 30 April 2007

Less than 1 year


Over 5 years

Borrowings 873 829 - - - Trade and other payables 51 634 - - - Bank overdraft 102 966 - - -

Interest rate risk

Deposit and all attract interest at rate that varies with prime. The company policy is to manage interest rate risk so that fluctuations in variable rates do not have a material impact on profit (loss).

The group’s interest rate risk arises from borrowings. Borrowings issued at variable rates expose the group to cash flow interest rate risk. Borrowings issued at fixed rates expose the group to fair value interest rate risk. During 2008 and 2007, the group’s borrowings at variable rate were denominated in the Rand and the EURO.

The group analyses its interest rate exposure on a dynamic basis. Various scenarios are simulated taking into consideration refinancing, renewal of existing positions, alternative financing and hedging. Based on these scenarios, the group calculates the impact on profit and loss of a defined interest rate shift. For each simulation, the same interest rate shift is used for all currencies.

The scenarios are run only for assets and liabilities that represent the major interest-bearing positions. Based on the simulations performed, the impact on post-tax profit of a 2% shift would be a maximum increase of R (164 762) (2007: R (112 692)) or decrease of R 164 762 (2007: R 112 692), respectively. The simulation is done on a quarterly basis to verify that the maximum loss potential is within the limit given by the management.

Cash flow interest rate risk `

Current interest rate

Due in less than a year

Due in one to two years

Due in two to three years

Due in three to four years

Due after five years

Shareholders loans 17.00% - (2 384 465) - - - Industrial Development Corporation (IDC) loan

20.00% (2 155 599) - - - -

Overdraft facilities used 15.50% (812 270) - - - - Fixed deposit 14.00% 99 659 - - - - Trade and other payables - PAYE, UIF and SDL

15.00% (2 923 466) - - - -

Baker Finance Ltd 15.00% (28 372) - - - - Director's loans 17.00% (109 250) - - - -

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Fair value interest rate risk `

Current interest rate

Due in less than a year

Due in one to two years

Due in two to three years

Due in three to four years

Due after five years

Trade and other receivables

15.00% 6 248 147 - - - -

Trade and other payables

15.00% (4 078 059) - - - -

Shareholders loans 15.00% (417 500) - - - - Finance lease 13.00% (84 448) (84 448) (84 448) (35 187) - Fixed interest loan from Baker Finance Ltd

40.50% (1 482 797) - - - -

Credit risk

Credit risk consists mainly of cash deposits, cash equivalents and trade debtors. The company only deposits cash with major banks with high quality credit standing and limits exposure to any one counter-party.

Trade receivables comprise a widespread customer base. Management evaluated credit risk relating to customers on an ongoing basis. If customers are independently rated, these ratings are used. Otherwise, if there is no independent rating, risk control assesses the credit quality of the customer, taking into account its financial position, past experience and other factors. Individual risk limits are set based on internal or external ratings in accordance with limits set by the board. The utilisation of credit limits is regularly monitored. Sales to retail customers are settled in cash, using major credit cards or financed by a bank with a high quality credit standing.

Financial assets exposed to credit risk at year end were as follows: `

Financial instrument

Trade and other receivables 6 248 147 972 703 - 67 573 Fixed deposits 99 659 98 849 99 659 98 849

Foreign exchange risk

The group does not hedge foreign exchange fluctuations.

Foreign currency exposure at balance sheet date

Non current assets Loan from Baker Finance Limited,Euro 125,460 (2007: Euro 84,073)

1 482 797 807 578 1 482 797 807 578

Loan from Baker Finance Limited,Euro 2,400 (2007: Euro 2,400)

28 365 23 053 - -

Exchange rates used for conversion of foreign items were: `

EURO 11.8189 9.60557 11.8189 9.60557 The group reviews its foreign currency exposure, including commitments on an ongoing basis. At 30 April 2008, if the Rand had increased or decreased with R1 against the EURO, the profit and loss before taxation would have increased or decreased with R127,860 (2007:R86,473)

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39. Going concern

We draw attention to the fact that at 30 April 2008, the group had accumulated losses of R (32,377,092), but the group’s total assets exceed its liabilities by R 3,340,293. The group has also made a profit after taxation in the current year of R10,200,327. The annual financial statements have been prepared on the basis of accounting policies applicable to a going concern. This basis presumes that funds will be available to finance future operations and that the realization of assets and settlement of liabilities, contingent obligations and commitments will occur in the ordinary course of business. The ability of the company to continue as a going concern is dependent on a number of factors. The most significant of these is that the group reach their profit forecast through realizing of profits budgeted for in the schools project tender. The deal is part BEE agreement with SMM Telematics (Pty) Ltd, concluded in the current financial year. Installation in terms of the tender has already commenced in April 2008.

40. Earnings per share

Basic earnings per share (cents) The calculation is based on earnings of R10,200,327 (2007: R-19,901,214) and on the weighted average amount of ordinary shares issued of 616,415,557 (2007: 508,508,765) at year-end.

- - 1.65 (3.91)

Headline earnings per share (cents)

The calculation is based on headline earnings of R4,275,721 (2007: R-8,548,316) and on the weighted average amount of ordinary shares issued of 616,415,557 (2007: 508,508,765) at year-end.

- - 0.69 (1.68)

Diluted earnings per share and diluted headline earnings per share

Diluted earnings per share is equal to earnings per share. Diluted headline earnings per share is equal to headline earnings per share. There is no dilution of shares due to the Beacham Options refer to note 14, as it will cause anti-dilution.

Reconciliation between earnings and headline earnings

Earnings - - 10 200 327 (19 901 214) Impairment of intangible assets - - - 11 352 898 Reversal of impairment of intangible assets

- - (5 922 956) -

Profit on sale of fixed assets - - (1 650) -

- - 4 275 721 (8 548 316)

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Group segmental analysis

Audited April 2008 % Audited April 2007 % Revenue MobileBio 10,612,549 45 8,745,177 66 SMSolutions 5,629,574 24 4,532,187 34 Royalty fee income 7,200,000 31 0 0 Corporate 0 0 0 0

23,442,123 100 13,277,365 100 Inter group eliminations 0 -32,233

23,442,123 13,245,132 Operating profit (loss) before tax MobileBio 2,786,099 -15,714,150 SMSolutions 1,331,076 744,828 Royalty fee income 6,800,000 0 Corporate -4,993,554 -4,964,125

5,923,620 -19,933,447 Inter group eliminations 0 32,233 Taxation 4,276,706 0 Profit (loss) after taxation 10,200,347 -19,901,214

Segment assets MobileBio 12,440,916 51 2,094,042 54 SMSolutions 847,608 3 1,190,494 31 Royalty fees 0 0 0 0 Corporate 11,277,811 46 577,872 15

24,566,335 100 3,862,408 100

Segment liabilities MobileBio 5,893,961 28 8,324,178 44 SMSolutions 1,283,098 6 2,374,995 13 Royalty fee income 0 0 0 Corporate 14,048,983 66 8,188,764 43

21,226,042 100 18,887,937 100

Other disclosures: Impairment of intangible assets - MobileBio -5,922,957

Reversal of impairment - MobileBio 5,922,957

Depreciation and amortisation - MobileBio -1,394,602 -216,607 - SMSolutions -558,403 -749,610 - Corporate -1,634,000 0

Prior year error - Segment liabilities -25,354 Reclassification of comparative figures - Segment assets 98,849

59

NOTICE OF ANNUAL GENERAL MEETING

BEGET HOLDINGS LIMITED (Incorporated in the Republic of South Africa)

(Registration Number 2002/011635/06)

Share code: BEE ISIN: ZAE000044111

(“Beget” or “the company”)

FIFTH ANNUAL GENERAL MEETING

Notice is hereby given that the fifth annual general meeting of members will be held at 85 Durham Street, Clubview, CENTURION at 12h00 on Monday, 29 September 2008 (the “annual general meeting”), to transact the business set out below: 1. To receive and consider the audited annual financial statements for the year ended 30 April 2008. 2. To re-appoint PKF (Pretoria) Inc. as auditors. 3. To approve the remuneration of the directors.

4. To re-elect retiring directors in accordance with the Articles of Association. Such re-election will be

moved in a single motion if a unanimous resolution that it be so moved is first passed, failing which motions for re-election will be moved individually in respect of each retiring director.

In accordance with Article 80 of the Articles of Association Messrs AH Potgieter, CJ van Coller, D Hawkins, H Potgieter and T Mogashoa retire and being eligible, offer themselves for re-election. An abridged curriculum vitae in respect of each director retiring and offering himself for re-election is set out on page 8 of the annual report of which this notice forms part.

5. To consider and, if deemed fit, to pass with or without modification, the following special resolution:

Special Resolution

“Resolved that the directors be and hereby are authorised, by way of general approval and in terms of Article 31.10 of the Articles of Association, to acquire, on behalf of the company or its subsidiaries, ordinary shares issued by the company (“ordinary shares”), in terms of Sections 85 and 89 of the Companies Act, 1973 (Act 61 of 1973), as amended, and in terms of the Listings Requirements of the JSE Limited South Africa (“JSE”), provided that:

• any such acquisition of ordinary shares (the “acquisition”) shall be implemented on the open

market of the JSE, through the order book operated by the JSE trading system and done without any prior understanding or arrangement between the company and the counterparty (reported trades are prohibited) and in accordance with the company’s Articles of Association;

• such general authority shall only be valid until the next annual general meeting but not beyond 15 months from the date of passing this special resolution;

60

• an announcement will be published as soon as the company has cumulatively acquired 3% of the ordinary shares in issue as from the date of this approval, and for each 3% thereof in aggregate acquired thereafter, containing full details of such acquisition;

• in terms of this general authority, the acquisition may not exceed, in aggregate, 20% of the company’s issued share capital of that class in the financial year ending 30 April 2007 (“the next year”);

• in determining the price at which the ordinary shares issued by the company are repurchased by it in respect of the acquisition in terms of this general authority, the maximum price at which such ordinary shares may be repurchased will not be greater than 10% above the weighted average of the market value of ordinary shares for the five business days immediately preceding the date of the acquisition of such ordinary shares;

• only one agent is appointed at any point in time to effect the acquisition in terms of this resolution;

• the company may only undertake an acquisition of ordinary shares if after such acquisition it still complies with paragraphs 3.37 to 3.41 of the Listings Requirements of the JSE concerning member spread requirements;

• the company or its subsidiary may not repurchase ordinary shares pursuant to the acquisition during a prohibited period as defined in paragraph 3.67 of the Listings Requirements of the JSE; and

• in the case of an acquisition by a subsidiary of the company, the authority shall be valid only if:

- the subsidiary is authorised by its Articles of Association; - the shareholders of the subsidiary have passed a special resolution authorizing

the acquisition; and - the number of ordinary shares to be acquired is not greater than 10% of the

number of issued shares in the company.” Reason for and effect of the special resolution The reason for and effect of the special resolution is to grant the company or its subsidiaries a general authority in terms of the Companies Act, No. 61 of 1973, as amended, to acquire the ordinary shares of the company. The board has considered the impact of the acquisition and is of the opinion that, taking into consideration the maximum number of ordinary shares that could be repurchased pursuant to the acquisition:

• the company and the group would, in the ordinary course of business, be able to repay its

debts for the next year; • the assets of the company and the group, fairly valued in accordance with the Statements

of International Financial Reporting Standards would exceed the liabilities of the company and the group for the next year;

• the ordinary capital and reserves of the company and the group would be adequate for the next year; and

• the working capital of the company and its subsidiaries would be adequate for the next year.

The following information required in terms of section 11.26 of the Listings Requirements of the JSE can be found in the following respective pages of the annual report to which this notice of annual general meeting is attached:

Directors and management Page 8 Major shareholders Page 16 Directors’ interests in securities Page 16 Share capital of the company Page 21 Responsibility statement Page 15

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6. To consider and, if deemed fit, to pass with or without modification, the following ordinary resolutions:

6.1 Ordinary Resolution Number 1

“Resolved that the unissued shares in the company be and are hereby placed under the control of the board of directors until the next annual general meeting in terms of the Companies Act 1973 (Act 61 of 1973), the Articles of Association of the company, and the Listings Requirements of the JSE.”

6.2 Ordinary Resolution Number 2

“Resolved that, as more than 35% of the company’s shares are held by the public, as defined by the JSE, and subject to not less than 75% of the votes exercisable by members of the company, present in person represented or by proxy and entitled to vote, being cast in favour of this ordinary resolution number 2, the directors be given the general authority to issue and/ or give options to subscribe for all or any of the un-issued ordinary shares of the company as the directors in their discretion may think fit, subject to the following conditions, namely that: • the shares that will be issued subject to this authority, must be of a class already in issue or be

convertible into a class already in issue; • the general authority shall only be valid until the next annual meeting but not beyond 15 months

from the due date of this annual general meeting, and that such general authority may be varied or revoked at any general meeting of the company prior to the next annual general meeting;

• the general issue, in the aggregate in the next year, may not exceed 15% of the company’s issued share capital as required by section 5.52 of the Listings Requirements of the JSE;

• a press announcement giving full details, including the impact on net asset value and earnings per share, will be published at the time of any issue representing 5% or more of the number of ordinary shares in issue prior to such issue;

• in determining the price at which an issue of shares will be made in terms of this authority, the maximum discount permitted will be 10% of the weighted average traded price of such shares measured over the 30 business days prior to the date that the price of the issue is determined or agreed by the directors of the company; and

• any such issue will only be made to public shareholders as defined by the Listings Requirements of the JSE, and not to related parties.”

6.3 Ordinary Resolution Number 3 “Resolved that any director of the company be and is hereby authorised to do all such things and sign all such documents as may be necessary for or incidental to the implementation of the special resolution and ordinary resolution numbers 1 and 2, each of which are contained in this notice convening the annual general meeting at which this ordinary resolution number 3 is proposed.”

7. To transact such other business as may be transacted at an annual general meeting.

Proxies A form of proxy is attached for the convenience of any member registered as such (either as the holder of shares in certificated form and whose name is reflected in the register of company members, or as the holder of shares in dematerialised form who has elected “own-name” registration with a Central Securities Depository Participant (“CSDP”)) who is entitled to appoint one or more proxies to attend, speak and, on a poll, vote in his/her/its stead should he/she/it be unable to attend the annual general meeting, but wish to be represented thereat. A proxy need not be a member of the company and a member may appoint more than 1 (one) proxy to act on his/her/its behalf at the annual general meeting. Forms of proxy should be forwarded to reach the office of the company at 85 Durham Street, Clubview, CENTURION or the transfer secretaries namely link marketing Services SA (Pty) Limited (“the transfer secretaries”) at Ground Floor, 11 Diagonal Street, Johannesburg (c/o Martie Köhne, PO Box 4844, Johannesburg, 2000), at least 48 hours before the commencement of the annual general meeting (excluding Saturdays, Sundays and public holidays).

62

Members who have dematerialised their shares in Beget such that their holdings are no longer recorded in their own names should arrange with their CSDP or broker for the necessary authority to attend the annual general meeting, should they wish to attend in person. Should they be unable, or not wish to attend but wish to be represented at the annual general meeting, they must provide their CSDP or broker with their voting instructions in terms of the agreement entered into between such member and CSDP or broker concerned in the manner and cut-off time stipulated therein. Dematerialised members who have elected “own-name” registration in the sub-register through a CSDP and who are unable to attend but wish to vote at the annual general meeting must complete and return the attached relevant form of proxy and lodge it with either the company or the transfer secretaries of the company.

By order of the Board of Directors Pretoria 30 July 2008

63

FORM OF PROXY BEGET HOLDINGS LIMITED

(Incorporated in the Republic of South Africa) (Registration Number 2002/011635/06) Share code: BEE ISIN: ZAE000044111

(“Beget” or the “company”)

For use at the annual general meeting of members of the company to be held in the boardroom of Beget, 85 Durham Street, Clubview, CENTURION on Monday, 29 September 2008 at 12:00 or any adjournment thereof (the “annual general meeting”) To be completed by certificated members and dematerialised members with “own-name” registration only. This form of proxy is not for use by holders of the company’s dematerialised shares who have not selected “own-name” registration. Such members must contact their Central Securities Depository Participant (“CSDP”) or broker timeously if they wish to attend and vote at the annual general meeting, and request that they be issued with the necessary authorisation to do so or provide the CSDP or broker, timeously, with their voting instruction should they not wish to attend the annual general meeting in order for the CSDP or broker to vote in accordance with their instruction thereat. I/We (name in full) __________________________________________________________________________________ of_(address)________________________________________________________________________ Being a member of Beget, holding ________________________ ordinary shares hereby appoint 1. _______________________________of__________________________________ or failing him/her; 2. _______________________________of__________________________________ or failing him/her; 3. _______________________________of__________________________________ or failing him/her; the Chairman of the annual general meeting, as my/our proxy to vote for me/us on my/our behalf at the annual general meeting of the company to be held on Tuesday, 31 May 2005 and at any adjournment thereof as follows:

Number of votes (one vote per ordinary share)

In favour of Against Abstain 1. Adoption of the annual financial statements 2. Re-appointment of the auditors for the ensuing year 3. Confirmation of directors’ remuneration____________________________________________________________________________________ 4. Election of directors 5. Special Resolution “company may buy back own shares” 6. Ordinary Resolution Number 1 “shares placed under directors’ control” ____________ 7. Ordinary Resolution Number 2 “general authority to issue shares/options for cash” 8. Ordinary Resolution Number 3 “authorisation to implement resolutions” (Indicate instruction to proxy by way of inserting number of votes in the appropriate space provided above. See Note 3 overleaf.) Unless otherwise instructed, my/our proxy may vote as he/she thinks fit. Signed this___day of _____________________2008 Signature:____________________________ Assisted by me (where applicable) ___________________________________________

Please read the notes overleaf. 43

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NOTES TO PROXY

1. A member entitled to attend and vote at the annual general meeting may appoint one or more proxies (none of whom need be a member of the company) to speak and vote in his/her/its capacity. A proxy need not be a member of the company. Proxy forms should be forwarded to reach the company’s office at 85 Durham Street, Clubview, CENTURION, Pretoria or the transfer secretaries Link Marketing Services SA (Pty) Limited at Ground Floor, 11 Diagonal Street, Johannesburg, (c/o Martie Köhne, PO Box 4844, Johannesburg, 2000) at least 48 hours before the meeting (excluding Saturdays, Sundays and public holidays). 3. A member may insert the name of a proxy or the name of two alternative proxies of the member’s choice in the space/s provided, with or without deleting “the Chairman of the annual general meeting”. Any such deletion must be initialed by the member. The person whose name appears first on the form of proxy who is present at the annual general meeting and whose name has not been deleted will be entitled to act as proxy to the exclusion of those whose names follow. If no proxy is named on a lodged form of proxy the Chairman shall be deemed to be appointed as the proxy. 4. A member’s instructions to the proxy must be indicated by the insertion of the relevant number of votes exercisable by that member in the appropriate space provided. Failure to comply with the above will be deemed to authorise the chairman of the annual meeting, if he is the authorised proxy, to vote in favour of the resolutions as he deems fit, or any other proxy to vote or abstain from voting at the annual general meeting as he/she deems fit, in respect of the member’s vote exercisable thereat. A member or his/her proxy is not obliged to use all the votes exercisable by the member or by his/her proxy, but the total of votes cast and in respect of which abstention is recorded may not exceed the total of the votes exercisable by the member or by his/her proxy. 5. Any alteration or correction to this form of proxy must be initialed by the relevant signatory/ies. 6. Documentary evidence establishing the authority of a person signing this form of proxy in a representative capacity must be attached to this form unless previously recorded by the transfer secretaries of the company or waived by the chairman of the annual general meeting. 7. The chairman of the annual general meeting may accept or reject a proxy which is completed and/or received other than in accordance with the instructions, provided that he/she shall not accept a proxy unless he/she is satisfied as to the manner in which the member concerned wishes to vote. 8. If a member has dematerialised his/her/its shares with a CSDP or broker, he/she/it must arrange with the CSDP or broker concerned to provide such CSDP or broker with the necessary authorisation to attend the annual general meeting and the member concerned must instruct such CSDP or broker as to how they wish to vote in this regard. This must be done in terms of the agreement entered into between the member and the CSDP or broker concerned and in the manner and cut-off time stipulated therein. 9. The completion and lodging of this form of proxy will not preclude the relevant member from attending the annual general meeting and speaking and voting in person thereat to the exclusion of any proxy appointed in terms hereof, should such member wish to do so. 10. Where there are joint holders of shares the vote of the first joint holder who tenders a vote, as determined by the order in which the names stand in the register of members will be accepted. 11. A minor must be assisted by his/her parent or guardian unless the documents establishing his/her legal capacity are produced or have been registered by the transfer secretaries of the company. 12. Where there are any joint holders of any shares, only that holder whose name appears first in the register in respect of such shares need sign this form of proxy.

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