106
ANNUAL REPORT 2016
NOTES TOTHE FINANCIAL STATEMENTS
30 JUNE 2016
(Continued)
4.
SIGNIFICANT ACCOUNTING POLICIES (continued)
4.18 Foreign currencies (continued)
(b)
Foreign currency translations and balances
Transactions in foreign currencies are converted into functional currency at rates of exchange ruling at the transaction dates.
Monetary assets and liabilities in foreign currencies at the end of each reporting period are translated into functional currency
at rates of exchange ruling at that date. All exchange differences arising from the settlement of foreign currency transactions and
from the translation of foreign currency monetary assets and liabilities are included in profit or loss in the period in which they
arise. Non-monetary items initially denominated in foreign currencies, which are carried at historical cost are translated using
the historical rate as of the date of acquisition, and non-monetary items, which are carried at fair value are translated using the
exchange rate that existed when the values were determined for presentation currency purposes.
(c)
Foreign operations
Financial statements of foreign operations are translated at end of the reporting period exchange rates with respect to their assets
and liabilities, and at exchange rates at the dates of the transactions with respect to the statement of profit or loss and other
comprehensive income. All resulting translation differences are recognised as a separate component of equity.
In the consolidated financial statements, exchange differences arising from the translation of net investment in foreign operations
are taken to equity. When a foreign operation is partially disposed of or sold, exchange differences that were recorded in equity
are recognised in profit or loss as part of the gain or loss on disposal.
Exchange differences arising on a monetary item that forms part of the net investment of the Company in a foreign operation
shall be recognised in profit or loss in the separate financial statements of the Company or the foreign operation, as appropriate.
In the consolidated financial statements, such exchange differences shall be recognised initially as a separate component of
equity and recognised in profit or loss upon disposal of the net investment.
Goodwill and fair value adjustments to the assets and liabilities arising from the acquisition of a foreign operation are treated
as assets and liabilities of the acquired entity and translated at the exchange rate ruling at the end of each reporting period.
4.19 Revenue recognition
Revenue is measured at the fair value of the consideration received or receivables, net of discounts and rebates.
Revenue is recognised to the extent that it is probable that the economic benefits associated with the transaction would flow to the
Group, and the amount of revenue and the cost incurred or to be incurred in respect of the transaction can be reliably measured and
specific recognition criteria have been met for each of the activities of the Group as follows:
(a)
Sale of goods
Revenue from sale of goods is recognised when significant risk and rewards of ownership of the goods has been transferred to
the customer and where the Group does not have continuing managerial involvement over the goods, which coincides with the
delivery of goods and acceptance by customers.
(b)
Dividend income
Dividend income is recognised when the right to receive payment is established.
(c)
Interest income
Interest income is recognised as it accrues, using the effective interest method.
(d)
Rental income
Rental income is accounted for on a straight line basis over the lease term of an ongoing lease.
(e)
Royalty income
Royalty income is recognised on an accrual basis in accordance with the substance of the relevant agreements.
