enl commercial limited annual report 2011 - Investing In Africa

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Notes to the Financial Statements Year ended June 30, 2011 2 SIGNIFICANT ACCOUNTING POLICIES (continued) (c) Investments in associates (continued) Consolidated financial statements (continued) The results of associated companies acquired or disposed of during the year are included on the consolidated statement of comprehensive income from the date of their acquisition or up to the date of their disposal. Unrealised profits and losses are eliminated to the extent of the group’s interests in the associate. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the assets transferred. Where necessary, appropriate adjustments are made to the financial statements of associates to bring the accounting policies used in line with those adopted by the group. If the ownership in an associate is reduced but significant influence is retained, only a proportionate share of the amounts previously recognised in other comprehensive income are reclassified to profit or loss where appropriate. (d) Property, plant and equipment All property, plant and equipment are initially recorded at cost, some of which are subsequently shown at revalued amount, less subsequent depreciation. All other property, plant and equipment are stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items. Subsequent costs are included in the assets’ 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 can be measured reliably. Increases in the carrying amount arising on revaluation are credited to revaluation surplus in shareholders’ equity. Decreases that offset previous increases of the same asset are charged against the revaluation surplus directly in equity. All other decreases are charged to the statement of comprehensive income. Depreciation is calculated on a straight line method to write off the cost or revalued amounts of the assets, with the exception of land, to their residual values over their estimated useful lives as follows: Years Buildings 10 - 50 Plant and equipment 5 - 10 Motor vehicles 7 - 10 Furniture and fittings 5 - 20 The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period. When the carrying amount of an asset is greater than its estimated recoverable amount, it is written down immediately to its recoverable amount. Gains and losses on disposals of property, plant and equipment are determined by comparing proceeds with carrying amount and are included on the statement of comprehensive income. On disposal of revalued assets, amounts in revaluation surplus relating to that asset are transferred to retained earnings. (e) (i) Intangible assets Goodwill Goodwill represents the excess of cost of acquisition over the group’s interests in the fair value of the net identifiable assets of the acquired subsidiary or associated entity at the date of acquisition. Goodwill on acquisition of associates is included in investments in associates. Any net excess of the group’s interests in the net fair value of the acquiree’s net identifiable assets over cost is recognised on the statement of comprehensive income. Goodwill is tested annually for impairment and carried at cost less accumulated impairment losses. On disposal of a subsidiary company or associated company, the attributable amount of goodwill is included in the determination of the gains and losses on disposal. Goodwill is allocated to cash-generating units for the purpose of impairment testing. 74 ENL Commercial Limited Annual Report 2011
Notes to the Financial Statements Year ended June 30, 2011 (e) (ii) Intangible assets (continued) Computer software Computer software is capitalised on the basis of costs incurred to acquire and bring to use the specific software and is amortised over its estimated useful life of 4 years. (f) Finance lease Leases are classified as finance lease where the terms of the lease transfer substantially all risks and rewards of ownership to the lessee. Finance leases are capitalised at the estimated present value of the underlying lease payments. Each lease payment is allocated between the liability and finance charges so as to achieve a constant rate on the finance balance outstanding. The corresponding rental obligations, net of finance charges, are included in borrowings. Finance charges are charged to the statement of comprehensive income over the lease period. Plant and equipment acquired under finance leasing contracts are depreciated over the useful lives of the assets. (g) Inventories Inventories and work in progress are valued at the lower of cost and net realisable value. Cost is determined on a weighted average basis. The cost of finished goods and work in progress comprises raw materials, direct labour, other direct costs and related production overheads but excludes interest expense. Net realisable value is the estimate of the selling price in the ordinary course of business less the costs of completion and applicable variable selling expenses. (h) Deferred income taxes Deferred income tax is provided in full, using the liability method, for all temporary differences arising between the tax bases of assets and liabilities and their carrying values in the financial statements. Deferred income tax is determined using tax rates that have been enacted by the end of the reporting period and are expected to apply in the period when the related deferred income tax asset is realised or the deferred income tax liability is settled. Deferred tax assets are recognised to the extent that it is probable that future taxable profit will be available against which deductible temporary differences can be utilised. (i) Foreign currencies Functional and presentation currency Items included in the financial statements of each of the group’s entities are measured using Mauritian rupees, the currency of the primary economic environment in which the entities operate (“functional currency”). The consolidated financial statements are presented in Mauritian rupees, the group’s functional and presentation currency. Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the date of the transactions. Gains and losses, resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies, are recognised on the statement of comprehensive income. Such balances are translated at year-end exchange rates unless hedged by forward foreign exchange contracts, in which case the rates specified in such forward contracts are used. On consolidation, the assets and liabilities of the group’s overseas entities are translated at exchange rates prevailing at the end of the reporting period. Income and expense items are translated at the average exchange rates for the period. Exchange differences, if any, are classified as other comprehensive income. Such translation differences are recognised on the statement of comprehensive income in the period in which the operation is disposed of. ENL Commercial Limited Annual Report 2011 75
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ENL COMMERCIAL LIMITED ANNUAL REPOR
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Dear Shareholder, The Board of Dire
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ENL Commercial Limited Annual Repor
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Portfolio of operating companies of
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Dividend per Share (Rs) 0.80 0.80 0
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ENL Commercial Limited Annual Repor
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Directors’ Report (continued) Ass
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AXESS LIMITED ENL Commercial Limite
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CHARABIA LTD ENL Commercial Limited
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COGIR LIMITÉE ENL Commercial Limit
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GREWALS (MAURITIUS) LIMITED ENL Com
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PACK PLASTICS LIMITED ENL Commercia
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Page 31 and 32: Corporate Information June 30, 2011
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Page 69 and 70: Statements of Comprehensive Income
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Page 115 and 116: Proxy Form ENL Commercial Limited I
Page 117 and 118: Notes ENL Commercial Limited Annual
Page 120: ENL Commercial Limited 7 th Floor S
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enl commercial limited annual report 2011 - Investing In Africa

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