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KD Holding Group
Notes to Consolidated Financial Statements as at and for the year ended 31 December 2007
security and other changes in the carrying amount
of the security. Translation differences related to
changes in the amortised cost are recognised in profit
or loss, and other changes in the carrying amount are
recognised in equity.
On consolidation, exchange differences arising
from the translation of the net investment in foreign
entities are taken to shareholders’ equity. When a
foreign operation is sold, such exchange differences
are recognised in the income statement as part of
the gain or loss on sale.
Translation differences on non-monetary financial
assets and liabilities are reported as part of the fair
2.5 Property, plant and equipment
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value gain or loss. Translation differences on nonmonetary
financial assets and liabilities such as
equities held at fair value through profit or loss are
recognised in profit or loss as part of the fair value
gain or loss. Translation differences on non-monetary
financial assets such as equities classified as available
for sale are included in the available-for-sale reserve in
equity.
Group companies
The financial statements of all group entities (none
of which has the currency of a hyperinflationary
economy) that have a functional currency different
from the presentation currency of the Group are
translated into the presentation currency as follows:
- assets and liabilities for each balance sheet
presented are translated at the reference rate of
the ECB or the Bank of Slovenia exchange rates
on the date of the balance sheet,
- income and expenses for each income statement
are translated at the average annual reference rate
of the ECB or the Bank of Slovenia exchange rates,
- all resulting exchange differences are recognised
as a separate component of equity (reserves).
After initial recognition, property and equipment
are carried at historical cost less accumulated
depreciation and accumulated impairment losses, if
any (cost model). Historical cost includes expenditure
that is directly attributable to the acquisition of the
items. Subsequent costs are included in the asset’s
carrying amount or recognised as a separate asset,
as appropriate, only when it is probable that future
economic benefits associated with the item will flow to
the Group and the cost of the item can be measured
reliably. All other repairs and maintenance are charged
to the income statement during the financial period in
which they are incurred.
Property and equipment is derecognised upon
disposal or when no further economic benefits are
expected from the item. The gain or loss arising
from the derecognition of an item of property and
equipment is determined as the difference between
the disposal proceeds and the carrying amount
of the item and is recognised in other operating
income.