Company: KARO
Filing Date: 2025-06-09
Form Type: 20-F
Source: 0001213900-25-052372
Chunk: 204

Company: Karooooo Ltd.
Filing Date: 2025-06-09
Form: 20-F
Item: Item 19
Chunk 204
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 Development (“ R& D”)
incentives and training grants.

Government grants are recognized when
there is reasonable assurance that the grant will be received and all attaching conditions will be complied with. When the grant relates
to an expense item, it is recognized as income on a systematic basis over the periods that the related costs, for which it is intended
to compensate, are expensed. Where the grant relates to an asset, the fair value is recognized as deferred capital grant on the balance
sheet and is amortized to profit or loss over the expected useful life of the relevant asset.

t)
Earnings per share

Basic earnings per share

Basic earnings per share is calculated
by dividing the profit or loss attributable to ordinary shareholders of the Group by the weighted average number of ordinary shares outstanding
during the financial year.

Diluted earnings per share

Diluted earnings per share is calculated
by dividing the profit attributable to ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding
during the financial year plus the weighted average number of ordinary shares that would be issued on conversion of all the dilutive potential
ordinary shares into ordinary shares.

u)
Share capital and share issue expenses

Proceeds from issuance of ordinary
shares are recognized as share capital in equity. Incremental costs directly attributable to the issuance of ordinary shares are deducted
against share capital.

v)
Treasury shares

The Group’s own equity instruments,
which are reacquired are recognized at cost and deducted from equity. No gain or loss is recognized in profit or loss on the purchase,
sale, issue or cancellation of the Group’s own equity instruments. Any difference between the carrying amount of treasury shares
and the consideration received, if reissued, is recognized directly in equity. Voting rights related to treasury shares are nullified
for the Group and no dividends are allocated to them respectively.

w)
Contingencies

A contingent liability is:

  a possible obligation that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence  

F-23

  a present obligation that arises from past events but is not recognized because:  

  (i)      It is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation; or  

  (ii)      The amount of the obligation cannot be measured with sufficient reliability.  

A contingent asset is a possible asset that arises from
past events and whose existence will be confirmed only by the occurrence or non-occurrence of one