Notes to the Consolidated Financial Statements
be required to settle the obligation;
and a reliable estimate of the
amount of the obligation can be
made. Provisions are measured at
the present value of management’s
best estimate of the expenditure
required to settle the obligation at
the statement of financial position
date.
Employee entitlements to annual
leave and long service leave are
recognised when they accrue to
employees. A provision is made
for the estimated liability for annual
leave and long-service leave as
a result of services rendered by
employees up to the statement of
financial position date.
Non-current-assets held
for sale
The Group classifies a non-current
asset (or disposal group) as held
for sale if its carrying amount will
be recovered principally through a
sale transaction rather than through
continuing use. A non-current asset
must be available for immediate
sale in its present condition subject
only to terms that are usual and
customary for sales of such assets
(or disposal groups). Its sale must
be planned and committed and an
active programme initiated to locate
a buyer and complete the plan within
one year. The asset (or disposal
group) must be actively marketed
for a price that is reasonable in
relation to its current fair value.
A non-current asset held for sale is
carried at the lower of its carrying
amount and the fair value less
costs to sell. Impairment losses are
recognised through the consolidated
statement of income for any initial or
subsequent write down of the asset
(or disposal group) to fair value
less costs to sell. Subsequent gains
in fair value less costs to sell are
recognised to the extent they do not
exceed the cumulative impairment
losses previously recorded. A non-
current asset is not depreciated
while classified as held for sale or
while part of a disposal group held
for sale.
The Group separately classifies the
material non-current assets held
for sale (or disposal group) in the
consolidated statement of financial
position. Furthermore, all major
classes of assets and liabilities
are disclosed. Any cumulative
income or expense is disclosed as
a separate item within equity. Prior
period amounts are not re-presented
to reflect the classification of the
assets (or disposal group) in the
current period.
Non-current assets, which are to be
abandoned, are not classified as
held for sale and are reclassified
as discontinued operations, to the
extent they meet the requirements
of discontinued operations in the
paragraph which follows.
If a non-current asset (or disposal
group) ceases to be classified as
held for sale or as discontinued
operations, the results of operations
are reclassified and included in the
consolidated statement of income
from continuing operations for all
periods presented.
Discontinued Operations
A discontinued operation is a
component (cash generating unit)
of an entity that either has been
disposed of or is classified as held
for sale and a) represents a major
business line or geographical area
of operations; b) is part of a single
coordinated plan to dispose of a
separate major business line or
geographical area of operations;
or c) is a subsidiary acquired
exclusively with a view to resell.
The Group presents after tax results
from discontinued operations as
a single separate component of
the statement of income. Revenues,
expenses, taxes, gains or losses
on the measurement to fair value
less costs to sell and cash flows
are additionally disclosed. Prior
periods are reclassified in order to
present all operations that have
been discontinued by the statement
of financial position date of the
latest period presented.
Due to banks and financial
institutions
Due to banks and financial institutions
are initially recorded at fair value and
subsequently measure at amortised
cost using the effective return method.
Borrowings
Borrowings are recognised initially
at fair value net of transaction
costs incurred. Borrowings are
subsequently stated at amortised
cost; any difference between
proceeds net of transaction
costs and the redemption value
is recognised in the consolidated
statement of income over the period
of the borrowings using the effective
return method.
Retirement benefit plans
The Group operates a number
of defined benefit and defined
contribution
pension
plans
throughout the world, the assets of
which are generally held in separate
trustee-administered funds. The
pension plans are generally funded
by payments from employees
and by the relevant Group
companies, taking into account the
recommendations of independent
qualified actuaries.
For defined benefit plans, the
pension accounting costs are
assessed using the projected unit
credit method. Under this method,
the cost of providing pensions
is charged to the consolidated
statement of income so as to spread
the regular cost over the service
lives of employees in accordance
with the advice of qualified actuaries
who carry out a valuation of the
plans every year. The pension
obligation is measured as the
present value of the estimated future
cash outflows using high standard
corporate bond rates which have
terms to maturity approximating
the terms of the related liability.
Actuarial gains and losses arising
from experience adjustments, and
changes in actuarial assumptions,
in excess of the greater of 10% of
the value of plan assets or 10% of
the defined benefit obligation, are
charged or credited to income over
the employees’ expected average
remaining working lives.
The Group’s contributions to
defined contribution pension plans
are charged in the consolidated
statement of income in the year to
which they relate.
26
Dar Al-Maal Al-Islami Trust
Annual Report 2012
