ANNUAL REPORT 2010 - Business and Arts South Africa

34
Accounting Policies
1. Presentation of Annual Financial
Statements
The annual financial statements have been prepared in
accordance with the International Financial Reporting
Standards for Small and Medium-sized Entities, and the
Companies Act of South Africa, 1973. The annual financial
statements have been prepared on the historical cost
basis, and incorporate the principal accounting policies set
out below. They are presented in South African Rands.
These accounting policies are consistent with the previous
period, except for the changes set out in note 13 Firsttime
adoption of the International Financial Reporting
Standards for Small and Medium-sized Entities.
1.1 Significant judgements and sources of
estimation uncertainty
In preparing the annual financial statements, management
is required to make estimates and assumptions that
affect the amounts represented in the annual financial
statements and related disclosures. Use of available
information and the application of judgement is inherent
in the formation of estimates. Actual results in the future
could differ from these estimates which may be material to
the annual financial statements.
1.2 Property, plant and equipment
Property, plant and equipment are stated at cost less
accumulated depreciation and any impairment losses.
Depreciation is provided using the straight-line basis to
write down the cost over the useful life of the property,
plant and equipment, which is as follows:
Item
Furniture and fittings
Office equipment
Computer equipment
average useful life
5 years
5 years
3 years
The residual value, depreciation method and the useful life
of each asset are reviewed at each annual reporting period
if there are indicators present that there is a change from
the previous estimate.
1.3 Membership fees
Membership fees consist of fees paid for annual corporate
membership of the company and are recorded in revenue
during the relevant year to which fees apply.
1.4 Government grants
Government grants are recognised when there is
reasonable assurance that:
- the company will comply with the conditions attaching to
them; and
- the grants will be received.
Government grants are recognised as deferred income
over the periods necessary to match them with the related
costs that they are intended to compensate.
1.5 Interest revenue
Interest is recognised on a time proportion basis that takes
into account the effective yield of the asset
1.6 Funds administered on behalf of third party
donors
The company administers funds on behalf of the
department and other third parties from time to time.
Receipts of funds are included with creditors and
disbursed on instruction from the relevant body.
1.7 Employee benefits Defined contribution
plans
Contributions to a defined contribution plan in respect of
service in a particular period are recognised as an expense
in that period.
It is not the policy of the company to provide retirement
benefits to all its employees. Employees may however
elect to be a member of a fund of their choice. All the