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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 amortised cost.
Bank overdraft and borrowings
Bank overdrafts and borrowings are initially measured
at fair value, and are subsequently measured at amor-
tised cost, using the effective interest rate method. Any
difference between the proceeds (net of transaction
costs) and the settlement or redemption of borrowings
is recognised over the term of the borrowings in accor-
dance with the group’s accounting policy for borrowing
costs.
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 pe-
riods 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 end of the reporting period.
Deferred tax assets and liabilities
A deferred tax liability is recognised for all taxable tem-
porary differences, except to the extent that the deferred
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 tem-
porary differences associated with investments in sub-
sidiaries, branches and associates, and interests in joint
ventures, except to the extent that both of the following
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 tem-
porary differences to the extent that it is probable that
taxable profit will be available against which the deduct-
ible temporary difference can be utilised, unless the de-
ferred 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 tem-
porary differences arising from investments in subsidiar-
ies, branches and associates, and interests in joint ven-
tures, to the extent that it is probable that:
•
the temporary difference will reverse in the foresee-
able 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 to the extent that it is probable that
future taxable profit will be available against which the
unused tax losses can be utilised.
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 substan-
tively enacted by the end of the reporting period.