WindarPhotonics AnnualReport 2018 All - Flipbook - Page 52
Notes to the Financial Statements
continued
4. Accounting policies (continued)
Financial liabilities
The Group treats its financial liabilities in accordance with the following accounting policies:
• Trade payables and other short-term monetary liabilities are recognised at fair value and subsequently
at amortised cost.
• Invoice discounting and loans are initially recognised at fair value net of any transaction costs directly
attributable to the issue of the instrument. Such interest-bearing liabilities are subsequently measured
at amortised cost using the effective interest rate method, which ensures that any interest expense over
the period to repayment is at a constant rate on the balance of the liability carried in the statement of
financial position. “Interest expense” in this context includes initial transaction costs and premiums
payable on redemption, as well as any interest payable while the liability is outstanding.
Share capital
Financial instruments issued by the Company are classified as equity only to the extent that they do not meet
the definition of a financial liability. The Company’s ordinary shares are classified as equity instruments.
Borrowing costs
Borrowing costs are recognised in the Statement of Profit or Loss and Other Comprehensive Income in the period
in which they are incurred.
Current taxation
The current tax is based upon the taxable profit for the period together with adjustments, where necessary,
in respect of prior periods. The Group’s asset or liability for current tax is calculated using tax rates that have
been enacted or substantively enacted at the financial period end date.
Current tax is recognised in the Statement of Profit or Loss and Other Comprehensive Income, except to the
extent that it relates to items recognised in other comprehensive income or directly in equity.
Deferred taxation
Deferred tax assets and liabilities are recognised where the carrying amount of an asset or liability in the Statement
of Financial Position differs from its tax base.
Recognition of deferred tax assets is restricted to those instances where it is probable that taxable profit will be
available against which the difference can be utilised.
The amount of the asset or liability is determined using tax rates that have been enacted or substantively enacted
by the reporting date and are expected to apply when the deferred tax liabilities/(assets) are settled/(recovered).
Dividends
Dividends are recognised when they become legally payable. In the case of interim dividends to equity shareholders,
this is when declared by the directors and paid. In the case of final dividends, this is when approved by the
shareholders at the annual general meeting.
Property, plant and equipment
Items of property, plant and equipment are initially recognised at cost and subsequently stated at cost less
accumulated depreciation and, where appropriate, provision for impairment in value or estimated loss on disposal.
Depreciation is provided on all items of property, plant and equipment so as to write off their carrying value, less
its residual value, over their expected useful economic lives. It is provided at the following rates:
Plant and equipment
over 3 - 5 years
The assets residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting
period.
Intangible assets – Development projects
Expenditure on research activities is recognised as an expense in the period in which it is incurred.
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Windar Photonics - Annual Report and Accounts 2018