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BLUE LABEL INTEGRATED ANNUAL REPORT 2014
NOTES TO THE GROUP ANNUAL FINANCIAL STATEMENTS
CONTINUED
For the year ended 31 May 2014
1.
SIGNIFICANT ACCOUNTING POLICIES (continued)
Deferred taxation
Deferred taxation is provided using the liability method for all temporary differences arising between the tax
bases of assets and liabilities and their carrying values for financial reporting purposes. However, if the
deferred income tax arises from initial recognition of an asset or liability in a transaction other than a
business combination that at the time of the transaction affects neither accounting nor taxable profit or loss,
it is not accounted for. Deferred income tax is determined using tax rates (and laws) that have been enacted
or substantively enacted by year-end and are expected to apply when the related deferred income tax asset is
realised or the deferred income tax liability is settled.
Deferred income tax assets are recognised to the extent that it is probable that future taxable profit will be
available against which the temporary differences can be utilised. Deferred income tax is provided on
temporary differences arising on investments in subsidiaries and associates, except where the timing of the
reversal of the temporary difference is controlled by the Group and it is probable that the temporary
difference will not reverse in the foreseeable future.
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current
tax assets against current tax liabilities and when the deferred income tax assets and liabilities relate to
income taxes levied by the same taxation authority on either the same taxable entity or different taxable
entities where there is an intention to settle the balances on a net basis.
Dividend tax
Dividend tax is provided for at 15% of the amount of any dividend paid, subject to certain exemptions. The
Dividend tax is a tax borne by the beneficial owner of the dividend and will be withheld by either the issuer
of the dividend or by regulated intermediaries.
Trade and other payables
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of
business from suppliers. Trade payables are classified as current liabilities if payment is due within the normal
operating cycle of the business. If not, they are presented as non-current liabilities.
Trade payables are measured initially at fair value and are subsequently measured at amortised cost, using
the effective interest rate method.
Revenue recognition
Revenue comprises the fair value of the consideration received or receivable for the sale of goods and
services in the ordinary course of the Group’s activities. Revenue is shown net of indirect taxes, estimated
returns, rebates and discounts, and after eliminated sales within the Group.
Revenue from the sale of goods and the rendering of services is recognised when it is probable that the
economic benefits associated with a transaction will flow to the Group and the amount of revenue, and
associated costs incurred or to be incurred, can be measured reliably.
Consideration received in advance of goods sold or services rendered is recorded in trade and other payables
as deferred revenue. The liability is reversed and the associated revenue is recognised only when the risks and
rewards of ownership of the goods are transferred to the customer or the service has been rendered.