Cellmid 2017 Annual Report
38
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.
(c) New accounting standards for application in future periods
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