Sasol Form 20-F for the year ended 30 June 2021 - Book - Page 109
and the level of precision applied in the review
controls within the Fuels segment.
Technology enhancements – An
appropriate and standard impairment
model which addresses the complexity of
the current inputs that are manually
captured from multiple sources with
associated controls will be designed,
tested and implemented to cater to the
applicable cash generating unit’s
impairment testing and allowing for the
use of standard assumptions and
methodologies.
Process improvements – Create redesigned and detailed documentation of
the entire South African integrated value
chain impairment process, while
reviewing and potentially simplifying the
impairment process. Review and redesign the total internal control
environment across the South African
integrated value chain to support the
refined processes.
People management – Engage in
appropriate capability assessments of
resources involved in the impairment
process, supported by training
programmes, re-prioritisation of activities
during the impairment assessment process
and clearly defined roles and
responsibilities. Implement additional
review procedures to enhance the level of
precision of the review processes in
conjunction with the roll-out of leadership
capability assessments and interventions.
During financial year 2021, the
company has successfully completed the
following remedial actions intended to address
the underlying causes that gave rise to this
material weakness within the Fuels segment:
Governance processes around the key
assumptions that feed the impairment
calculations have been enhanced to ensure
completeness and validity of the
assumptions.
Implemented additional review
procedures on the inputs into the
impairment model and the outputs
therefrom.
Additional internal controls have been
designed and implemented in terms of the
impairment model design, inputs,
assumptions and review thereof.
The Fuels impairment model has been
further developed to ensure the correct
modelling of the operations and
independent assurance obtained on the
design principles applied.
Additional review controls over inputs,
assumptions and outputs of the model
have been put in place
As a result of this review of the South
African integrated value chain impairment
assessment calculations during 2021,
management identified prior period errors as
outlined in b (ii) above, causing the material
weakness to be expanded to all the cash
generating units within the South African
integrated value chain. Accordingly, we have
since revised the comparative results for 2018,
2019 and 2020 in the 2021 consolidated
financial statements.
We believe our actions will be effective in
remediating the above noted material weakness, and we
continue to devote significant time and attention to
these efforts. As we continue to evaluate and work to
improve our internal controls over financial reporting,
we may take additional measures to address these
control deficiencies or we may modify certain of the
remediation measures described above. The material
weakness will not be considered remediated until we
have completed designing and implementing the
longer-term remediation efforts, the applicable remedial
controls operate for a sufficient period of time and
management has concluded, through testing, that these
controls are operating effectively.
In addition to the remedial actions
already implemented, the remediation efforts
summarised below are intended to further
address the underlying causes that gave rise to
the material weakness.
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