Company: KARO
Filing Date: 2025-06-09
Form Type: 20-F
Source: 0001213900-25-052372
Chunk: 195

Company: Karooooo Ltd.
Filing Date: 2025-06-09
Form: 20-F
Item: Item 19
Chunk 195
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 cost is recognized immediately in profit and loss.

Where subscriber contracts are expected
to be in existence for periods significantly shorter than the average useful life around 60 months, these are depreciated over a reduced
useful life.

Uninstalled telematics devices are devices not installed
and available for installation. Work in progress telematics devices are devices in progress of being manufactured.

ii.
Depreciation

Depreciation is computed on a straight-line basis over their
estimated useful lives of property, plant and equipment including right of use assets as follows:

  Category                                        Depreciation method      Average useful life                             
  Property                                        Straight line            20-50 years                                     
  Property - Right of use assets                  Straight line            Lease term or useful life whichever is shorter  
  Property - Leasehold improvements               Straight line            3 years or lease term                           
  Plant, equipment and vehicles                   Straight line            4-10 years                                      
  IT equipment                                    Straight line            3-5 years                                       
  Capitalized telematics devices - Installed      Straight line            5 years                                         
 ───────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────

Depreciation is recognized when the
property, plant and equipment are installed and are ready for use. Land and construction in progress are stated at cost and are not depreciated.

The residual value, useful life and depreciation method
are reviewed at each financial year-end, and adjusted prospectively, if appropriate.

An item of property, plant and equipment
is derecognized upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss on derecognition
of the asset is included in profit and loss in the year the asset is derecognized.

F-16

g)
Capitalized commission assets

i.
Recognition and measurement

Incremental sales commission costs
which are directly related to a customer contract are capitalized to capitalized commission assets and are measured at cost less accumulated
amortization.

ii.
Amortization

The capitalized commission assets are
amortized over the expected useful life of the average contract, which is over 60 months. If a contract with a customer is cancelled prior
to the end of its useful life, the unamortized cost is recognized immediately in profit and loss.

The useful life of items of capitalized
commission assets has been assessed as follows:

  Item                               Amortization method      Average useful life  
  Capitalized commission assets      Straight line