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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2015
98 Independence Group NL
Notes to the consolidated financial statements
30 June 2015
2 Summary of significant accounting policies (continued)
(b) Principles of consolidation (continued)
The acquisition method of accounting is used to account for business combinations by the Group (refer to note 2(e)).
Intercompany transactions, balances and unrealised gains on transactions between Group companies are eliminated.
Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset
transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the
policies adopted by the Group.
Non-controlling interests in the results and equity of subsidiaries are shown separately in the consolidated statements of
profit or loss and other comprehensive income, statement of changes in equity and balance sheet respectively.
(ii)
Associates
Associates are all entities over which the Group has significant influence but not control or joint control. This is generally
the case where the Group holds of between 20% and 50% of the voting rights. Investments in associates are accounted
for using the equity method of accounting, after initially being recognised at cost.
(iii)
Joint arrangements
Under AASB 11
Joint Arrangements
investments in joint arrangements are classified as either joint operations or joint
ventures. The classification depends on the contractual rights and obligations of each investor, rather than the legal
structure of the joint arrangement. The Group’s interests in joint venture entities, if any, are brought to account at cost
using the equity method of accounting in the financial statements, after initially being recognised at cost in the balance
sheet.
(c) Segment reporting
An operating segment is a component of an entity that engages in business activities from which it may earn revenues
and incur expenses (including revenues and expenses relating to transactions with other components of the same
entity), whose operating results are regularly reviewed by the entity’s chief operating decision maker to make decisions
about resources to be allocated to the segment and assess its performance and for which discrete financial information
is available. This includes start up operations which are yet to earn revenues.
Operating segments have been identified based on the information provided to the chief operating decision makers -
identified as being the Board of Independence Group NL.
Operating segments that meet the quantitative criteria as described by AASB 8
Operating Segments
are reported
separately. However, an operating segment that does not meet the quantitative criteria is still reported separately where
information about the segment would be useful to users of the financial statements.
(d) Foreign currency translation
(i)
Functional and presentation currency
Items included in the financial statements of each of the Group's entities are measured using the currency of the primary
economic environment in which the entity operates ('the functional currency'). The consolidated financial statements are
presented in Australian dollars, which is the Group's functional and presentation currency.
(ii)
Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the
dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and
from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are
recognised in profit or loss.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the
exchange rate as at the date of the initial transaction. Non-monetary items measured at fair value in a foreign currency
are translated using the exchange rates at the date when the fair value was determined.
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