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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)
2.21 Leases
(Continued)
As lessee
(Continued)
Capitalised leased assets are depreciated over the shorter of the estimated useful life of the asset and
the lease term if there is no reasonable certainty that the Group will obtain ownership by the end of
the lease term.
Operating lease payments are recognised as an expense in profit or loss on a straight-line basis over
the lease term. The aggregate benefit of incentives provided by the lessor is recognised as a reduction
of rental expense over the lease term on a straight-line basis.
As lessor
Leases where the Group retains substantially all the risks and rewards of ownership of the asset are
classified as operating leases. Initial direct costs incurred in negotiating an operating lease are added
to the carrying amount of the leased asset and recognised over the lease term on the same bases as
rental income. The accounting policy for rental income is set out in Note 2.22. Contingent rents are
recognised as revenue in the period in which they are earned.
2.22 Revenue recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the
Group and the revenue can be reliably measured, regardless of when the payment is made. Revenue
is measured at the fair value of consideration received or receivable, taking into account contractually
defined terms of payment and excluding discounts, rebates and sales taxes or duty. The Group assesses
its revenue arrangements to determine if it is acting as principal or agent. The following specific
recognition criteria must also be met before revenue is recognised:
Rendering of services
Revenue from cord blood banking contracts and cord lining banking services is recognised by
reference to the stage of completion of the service. Stage of completion is measured by reference to
the percentage of costs incurred to estimated total costs to complete the contracts.
Revenue received in advance for services to be rendered under cord blood and cord lining banking
contracts is accounted for as deferred revenue on the statements of financial position.
Sale of goods
Revenue from sale of goods is recognised upon the transfer of significant risk and rewards of ownership
of the goods to the customer, usually on delivery of goods. Revenue is not recognised to the extent
where there are significant uncertainties regarding recovery of the consideration due, associated costs
or the possible return of goods.
Interest income
Interest income is recognised using the effective interest method.
