Credit Union Annual Report 2021 V2 - Flipbook - Page 55
THE CAYMAN ISLANDS CIVIL SERVICE ASSOCIATION (CICSA)
CO-OPERATIVE CREDIT UNION LIMITED
NOTES TO FINANCIAL STATEMENTS (continued)
July 31, 2021
2.4 Summary of accounting policies (continued)
Leases
The Credit Union assesses at contract inception whether a contract is, or contains a lease. This is, if the contract conveys
the right to control the use of an identified asset for a period of time in exchange for consideration.
Credit Union as a lessee
The Credit Union applies a single recognition and measurement approach for all leases, except for short-term leases and
leases of low-value assets. Credit Union recognises lease liabilities to make lease payments and right-of-use assets
representing the right to use the underlying assets.
Right-of-use-assets
Credit Union recognises right-of-use assets at the commencement date of the lease (i.e., the date the underlying asset is
available for use). Right-of-use assets are measured at cost, less any accumulated depreciation and impairment losses, and
adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities
recognised, initial direct costs incurred, and lease payments made at or before the commencement date less any lease
incentives received. Right-of-use assets are depreciated on a straight-line basis over the lease term.
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each balance sheet date. Assets
that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that
the carrying amount may not be recoverable. An asset’s carrying amount is written down immediately to its recoverable
amount if the asset’s carrying amount is greater than its estimated recoverable amount. The recoverable amount is the
higher of the asset’s fair value less costs to sell and its value in use.
The right-of-use assets are presented within Note 6 Fixed Assets and Right-of-Use.
Members’ shares
Member shares are generally redeemable at the option of the holder of the shares, subject to certain conditions. As a
result, member shares are presented as financial liabilities and are not reclassified to equity as all reclassification criteria
within IAS 32 and IFRIC (“International Financial Reporting Interpretations Committee”) 2 are not met.
Other provision
Provisions for legal claims costs are recognized when the Credit Union has a present legal or constructive obligation as a
result of past events; it is probable that an outflow of resources will be required to settle the obligation; and the amount
has been reliably estimated. Provisions are not recognized for future operating losses.
Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a
rate that reflects current market assessments of the time value of money and the risks specific to the obligation. The
increase in the provision due to passage of time is recognized as interest expense.
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