Cellmid 2017 Annual Report

NOTES TO THE

FINANCIAL STATEMENTS

CONTINUED

The acquisition of subsidiaries is accounted for using the acquisition method of accounting. A change in ownership interest,

without the loss of control, is accounted for as an equity transaction, where the difference between the consideration

transferred and the book value of the share of the non-controlling interest acquired is recognised directly in equity attributable

to the parent.

Where the Group loses control over a subsidiary, it derecognises the assets including goodwill, liabilities and non-controlling

interest in the subsidiary together with any cumulative translation differences recognised in equity. The Group recognises the

fair value of the consideration received and the fair value of any investment retained together with any gain or loss in proﬁt or loss.

Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet mandatory,

have not been early adopted by the Group for the annual reporting period ended 30 June 2017. The Group’s assessment of

the impact of these new or amended Accounting Standards and Interpretations, most relevant to the Group, are set out below.

AASB 9 Financial Instruments

This standard is applicable to annual reporting periods beginning on or after 1 January 2018. The standard replaces

all previous versions of AASB 9 and completes the project to replace IAS 39 ‘Financial Instruments: Recognition and

Measurement’. AASB 9 introduces new classiﬁcation and measurement models for ﬁnancial assets. A ﬁnancial asset is

measured at amortised cost, if it is held within a business model whose objective is to hold assets in order to collect contractual

cash ﬂows, which arise on speciﬁed dates and solely principal and interest. All other ﬁnancial instrument assets are classiﬁed

and measured at fair value through proﬁt or loss unless the entity makes an irrevocable election on initial recognition to present

gains and losses on equity instruments (that are not held-for-trading) in other comprehensive income (‘OCI’). For ﬁnancial

liabilities, the standard requires the portion of the change in fair value that relates to the entity’s own credit risk to be presented

in OCI (unless it would create an accounting mismatch).

New simpler hedge accounting requirements are intended to more closely align the accounting treatment with the risk

management activities of the entity. New impairment requirements will use an ‘expected credit loss’ (‘ECL’) model to recognise

an allowance. Impairment will be measured under a 12-month ECL method unless the credit risk on a ﬁnancial instrument has

increased signiﬁcantly since initial recognition in which case the lifetime ECL method is adopted. The standard introduces

additional new disclosures.

The Group will adopt this standard from 1 July 2018 but the full impact of its adoption has not been assessed.

AASB 15 Revenue from Contracts with Customers

This standard is applicable to annual reporting periods beginning on or after 1 January 2017. The standard provides a single

standard for revenue recognition. The core principle of the standard is that an entity will recognise revenue to depict the

transfer of promised goods or services to customers in an amount that reﬂects the consideration to which the entity expects to

be entitled in exchange for those goods or services. The standard will require: contracts (either written, verbal or implied) to be

identiﬁed, together with the separate performance obligations within the contract; determine the transaction price, adjusted

for the time value of money excluding credit risk; allocation of the transaction price to the separate performance obligations

on a basis of relative stand-alone selling price of each distinct good or service, or estimation approach if no distinct observable

prices exist; and recognition of revenue when each performance obligation is satisﬁed. Credit risk will be presented separately

as an expense rather than adjusted to revenue. For goods, the performance obligation would be satisﬁed when the customer

obtains control of the goods. For services, the performance obligation is satisﬁed when the service has been provided, typically