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CORDLIFE GROUP LIMITED
| ANNUAL REPORT 2015
NOTES TO THE FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2015
2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED)
2.3 Standards issued but not yet effective
(Continued)
FRS 115 Revenue from Contracts with Customers
FRS 115 was issued in November 2014 and establishes a new five-step model that will apply to revenue
arising from contracts with customers. Under FRS 115, revenue is recognised at an amount that reflects
the consideration to which an entity expects to be entitled in exchange for transferring goods or
services to a customer. The principles in FRS 115 provide a more structured approach to measuring
and recognising revenue. The new revenue standard is applicable to all entities and will supersede all
current revenue recognition requirements under FRS. Either a full or modified retrospective application
is required for annual periods beginning on or after 1 January 2017 with early adoption permitted.
The Group is currently assessing the impact of FRS 115 and plans to adopt the new standard on the
required effective date.
FRS 109 Financial Instruments
In December 2014, the Accounting Standards Council (“ASC”) issued the final version of FRS 109
Financial Instruments which reflects all phases of the financial instruments project and replaces FRS
39 Financial Instruments: Recognition and Measurement. The standard introduces new requirements
for classification and measurement, impairment, and hedge accounting. FRS 109 is effective for
annual periods beginning on or after 1 January 2018, with early application permitted. Retrospective
application is required, but comparative information is not compulsory in the year of adoption. The
adoption of FRS 109 will have an effect on the classification and measurement of the Group’s financial
assets, but no impact on the classification and measurement of the Group’s financial liabilities.
2.4 Basis of consolidation and business combinations
(a)
Transfer of entities under common control
The pooling of interest method involves the following:
– The assets and liabilities of the combining entities are reflected at their carrying amounts.
– No adjustments are made to reflect the fair values, or recognise any new assets or
liabilities.
– No goodwill is recognised as a result of the combination.
– Any difference between the consideration paid/transferred and the equity ‘acquired’ is
reflected within the equity as merger reserve.
– The consolidated statement of comprehensive income reflects the results of the
combining entities for the full year, irrespective of when the combination took place.
– Comparatives are presented as if the entities had always been combined since the date
the entities had come under common control.
