-- Amendments to IFRS 10, 'Consolidated financial statements',
IFRS 12, 'Disclosures of interest in other entities', IAS 27,
'Separate financial statements' - Investment entities: The
amendments define an investment entity and introduce an exception
to consolidation particular subsidiaries for investment
entities.
-- Amendments to IAS 36, 'Impairment of assets', on the
recoverable amount disclosures for non-financial assets. This
amendment removed certain disclosures of the recoverable amount of
CGU's which has been included in IAS 36 by the issue of IFRS 13.
(Mandatory from 1 Jan 2014)
The Directors do not expect the adoption of the standards listed
above to have a significant impact on the financial statements of
the Group in future periods.
There are no other IFRSs or IFRIC interpretations that are not
yet effective that would be expected to have a material impact on
the Group.
Consolidation
Subsidiaries are all entities over which the Group has control.
Subsidiaries are fully consolidated from the date on which control
is transferred to the Group. They are deconsolidated from the date
that control ceases.
i. Business combinations
The Group applies the acquisition method to account for business
combinations. The cost of the acquisition is measured at the
aggregate of the fair values, at the date of completion, of assets
given, liabilities incurred or assumed, and equity instruments
issued by the Group in exchange for control of the acquired. The
acquiree's identifiable assets, liabilities and contingent
liabilities that meet the conditions for recognition under IFRS 3
are recognised at their fair value at the acquisition.
Whilst a corporate acquisition would normally be accounted for
under IFRS 3, there are situations where these transfers may not
qualify as business combinations. This is considered on a case by
case basis by management in light of the substance of the
acquisition.
The consideration payable in respect of each acquisition may be
dependent upon certain future events. In calculating the cost of
each acquisition the Group has assessed the most probable outcome
as at the balance sheet date. These amounts are reconsidered
annually at each year end and changes to consideration are taken to
the income statement.
ii. Joint ventures
The Group's investment properties are typically held in property
specific special purpose vehicles ("SPVs"), which may be legally
structured as a joint venture.
In assessing whether a particular SPV is accounted for as a
subsidiary or joint venture, the Group considers all of the
contractual terms of the arrangement, including the extent to which
the responsibilities and parameters of the venture are determined
in advance of the joint venture agreement being agreed between the
two parties. The Group will then consider whether it has the power
to govern the financial and operating policies of the SPV, so as to
obtain benefits from its activities, and the existence of any legal
disputes or challenges to this control in order to conclude on the
classification of the SPV as a joint venture or subsidiary
undertaking. The Group considers this position with the evidence
available at the time.
The consolidated financial statements account for interests in
joint ventures using the equity method of accounting per IFRS 11.
Any premium paid for an interest in a jointly controlled entity
above fair value of identifiable assets, liabilities and contingent
liabilities is accounted for in accordance with the goodwill
accounting policy.
Investment property
Property held to earn rentals and for capital appreciation is
classified as investment property. Investment property comprises
both freehold and leasehold land and buildings.
Investment property is recognised as an asset when:
-- It is probable that the future economic benefits that are
associated with the investment property will flow to the
Company:
-- There are no material conditions precedent which could
prevent completion; and
-- The cost of the investment property can be measured
reliably.
Investment property is measured initially at its cost, including
related transaction costs. After initial recognition, investment
property is carried at fair value. The Group has appointed Colliers
International as property valuers to prepare valuations on a
semi-annual basis. Valuations are undertaken in accordance with the
appropriate Sections of the current Practice Statements contained
in the Royal Institution of Chartered Surveyors Valuation -
Professional Standards, (the "Red Book"). This is an
internationally accepted basis of valuation.
Gains or losses arising from changes in the fair value of
investment property are included in the income statement in the
period in which they arise.
When the Group begins to redevelop an existing investment
property for continued future use as an investment property, the
property remains an investment property and is accounted for as
such. When the Group begins to redevelop an existing investment
property with a view to sell, the property is transferred to
trading properties and held as a current asset. The property is
re-measured to fair value as at the date of the transfer with any
gain or loss being taken to the income statement. The re-measured
amount becomes the deemed cost at which the property is then
carried in trading properties.
In completing these valuations the valuer considers the
following:
i. current prices in an active market for properties of a
different nature, condition or location (or subject to different
lease or other contracts), adjusted to reflect those
differences;
ii. recent prices of similar properties in less active markets,
with adjustments to reflect any changes in economic conditions
since the date of the transactions that occurred at those prices;
and
iii. discounted cash flow projections based on reliable
estimates of future cash flows, derived from the terms of any
existing lease and other contracts and (where possible) from
external evidence such as current market rents for similar
properties in the same location and condition, and using discount
rates that reflect current market assessments of the uncertainty in
the amount and timing of the cash flows.
The cost of properties in the course of development includes
attributable interest and other associated outgoings. Interest is
calculated on the development expenditure by reference to specific
borrowings where relevant and otherwise on the average rate
applicable to the term loans. A property ceases to be treated as a
development property on practical completion.
Development property
Properties acquired with the intention of redevelopment are
classified as development properties and stated at fair value,
being market value determined by professionally qualified external
valuers. Changes in fair value are included in the income
statement. All costs directly associated with the purchase and
construction of a development property are capitalised. When
development properties are completed, they are reclassified as
investment properties.
Property, plant and equipment
Fixtures and equipment are stated at cost less accumulated
depreciation and any recognised impairment loss.
Depreciation is recognised so as to write off the cost or
valuation of assets less their residual values over their useful
lives, using the straight-line method, on the following bases:
Fixtures and equipment 10% - 25%
The gain or loss arising on the disposal of an asset is
determined as the difference between the sales proceeds and the
carrying amount of the asset and is recognised in income.
Leasing (as lessors)
Properties leased out under operating leases are included in
investment property in the Balance Sheet. The Group makes payments
to agents for services in connection with lease contracts with the
Group's lessees. The letting fees are capitalised within the
carrying amount of the related investment property and amortised
over the lease term.
Leasing (as lessees)
Leases in which a significant portion of the risks and rewards
of ownership are retained by another party, the lessor, are
classified as operating leases. Payments including prepayments,
made under operating leases (net of any incentives received from
the lessor) are charged to income statement on a straight-line
basis over the period of the lease.
Goodwill
Goodwill arising on acquisition is recognised as an asset and
initially measured at cost, being the excess of the cost of the
business combination over the Group's interest in the net fair
value of the identifiable assets, liabilities and contingent
liabilities recognised. If, after reassessment, the Group's
interest in the net fair value of the acquiree's identifiable
assets, liabilities and contingent liabilities exceeds the cost of
the business combination, the excess is recognised immediately in
the income statement. Goodwill is reviewed for impairments
annually.
Financial instruments
Financial assets
Financial assets are classified as financial assets at fair
value through profit or loss, loans and receivables as appropriate.
The Group determines the classification of its financial assets at
initial recognition. When financial assets are recognised
initially, they are measured at fair value plus, in the case of
investments not at fair value through profit or loss, directly
attributable transaction costs.
The Group's financial assets consist of loans and
receivables.
Cash and cash equivalents are also classified as loans and
receivables. They are subsequently measured at amortised cost. Cash
and cash equivalents include cash in hand.
Grafico Azioni Newriver Reit (LSE:NRR)
Storico
Da Giu 2024 a Lug 2024
Grafico Azioni Newriver Reit (LSE:NRR)
Storico
Da Lug 2023 a Lug 2024
