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BUSINESS MODEL
AND STRATEGIC
OBJECTIVES
LEADERSHIP
GOVERNANCE
OPERATING
PERFORMANCE
SHAREHOLDERS’
INFORMATION AND
ADMINISTRATION
FINANCIAL
PERFORMANCE
BLUE LABEL INTEGRATED ANNUAL REPORT 2014
125
NOTES TO THE GROUP ANNUAL FINANCIAL STATEMENTS
CONTINUED
For the year ended 31 May 2014
1.
SIGNIFICANT ACCOUNTING POLICIES (continued)
Foreign currencies
(a) Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of
the primary economic environment in which the entity operates (the functional currency). The Group
financial statements are presented in South African Rand (‘ZAR’), which is the Group’s functional and
presentation currency.
(b) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing
at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such
transactions and from the translation at year-end exchange rates of monetary assets and liabilities
denominated in foreign currencies are recognised in the statement of comprehensive income.
(c)
Group companies
The results and financial position of all the Group entities (none of which has the currency of a
hyperinflationary economy) that have a functional currency different from the presentation currency are
translated into the presentation currency as follows:
•
•
Assets and liabilities are translated at the closing rate as at statement of financial position date;
•
•
Income and expenses are translated at average exchange rates (unless this average is not a reasonable
approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case
income and expenses are translated at the dates of the transactions); and
•
•
All resulting exchange differences are recognised as a separate component of equity.
On consolidation, exchange differences arising from the translation of the net investment in foreign entities,
and of borrowings and other currency instruments designated as hedges of such investments, are taken to
other comprehensive income. When a foreign operation is partially disposed of or sold, such exchange
differences are recognised in the statement of comprehensive income as part of the gain or loss on sale.
Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as the foreign
entity’s assets and liabilities and are translated at the closing rate.
Financial instruments
Financial instruments carried on the statement of financial position include:
Financial assets
•
•
Financial assets at fair value through profit or loss.
•
•
Loans receivable.
•
•
Trade and other receivables.
•
•
Cash and cash equivalents.
Financial liabilities
•
•
Borrowings.
•
•
Trade and other payables.
•
•
Bank overdraft.