Annual Report 2010 - Frauenthal Holding AG

96 Annual Report 2010
Consolidated Financial Statements Frauenthal Holding Group 2010
The Frauenthal Group does not anticipate that application of the standards and interpretations in question will have any
material effects on its assets, finances and earnings.
IFRS 9 Financial Instruments
This standard, published on 12 November 2009, represents the first phase of a project aimed at replacing IAS 39. IFRS 9
deals with the classification and measurement of financial assets. The former “loans and receivables”, “held to maturity”,
“available for sale” and “at fair value through profit or loss” categories are to be replaced by new “fair value” and “at
amortised cost” asset classes. Classification of a financial asset as “at amortised cost” is on the basis of the entity’s business
model and the characteristics of the financial instrument in question. Non-fulfilment of the relevant conditions leads to
recognition at fair value through profit or loss. In exceptional cases some equity instruments may be measured at fair value
but not through profit or loss. However any subsequent changes in fair value must then be irrevocably presented in other
comprehensive income, and can no longer be recognised in profit or loss. The IASB issued a new version of IFRS 9 on 28 October,
having added requirements for the classification and measurement of financial liabilities, and decided to carry forward
the requirements in IAS 39 for the derecognition of financial assets and financial liabilities. IFRS 9 does not change the basic
accounting model for financial liabilities under IAS 39. There are still two measurement categories: fair value through profit
or loss and amortised cost. Financial liabilities held for trading are measured at fair value through profit or loss (FVTPL), and
all other financial liabilities are measured at amortised cost unless the entity voluntarily designates them as FVTPL (“fair value
option”) at initial recognition. The amendments are likely to become effective for annual periods beginning on or after 1 January
2013. Early application was permitted from 2009 onwards, subject to endorsement by the EU, but this is still pending.
Improvements to IFRS made by the 2008–2010 annual improvements projects
On 6 May 2010 the IASB published amendments to six standards (IFRS 1, IFRS 3, IFRS 7, IAS 1, IAS 27 and IAS 34) and one
interpretation (IFRIC 13), made as part of the 2008–2010 annual improvements project cycle. The amendments reflect issues
that were addressed by the draft of proposed amendments to IFRSs published in August 2009. The publication also includes
an amendment to IFRS 1 applicable to entities with operations subject to rate regulation. This was included in the Rateregulated
Activities exposure draft, published in July 2009. Unless otherwise specified, the amendments are effective for
annual periods beginning on or after 1 January 2011, with earlier application permitted. Adoption by the EU is still pending.
Amendments to IFRS 7: Improving Disclosures about Financial Instruments
The IASB published these amendments on 7 October 2010. They concern improvements to disclosures regarding transfers
of financial assets. The amendments are likely to become effective for annual periods beginning on or after 1 July 2011.
Adoption by the EU is still pending.
Amendments to IFRS 1: Severe Hyperinflation and Removal of Fixed Dates for First-time Adopters
On 20 December 2010 the IASB published two minor amendments to IFRS 1. The first replaces references to a fixed date for
first-time adopters, 1 January 2004, by “the date of transition to IFRSs”. The second provides guidance on how to resume
presenting IFRS financial statements for entities that have been unable to comply with IFRS for some time because their
functional currencies were subject to severe hyperinflation. Both amendments will become effective on 1 July 2011. Early
application is permitted. Adoption by the EU is still pending.
Amendments to IAS 12: Deferred Tax: Recovery of Underlying Assets
On 20 December 2010 the IASB published amendments to IAS 12 based on proposals in an exposure draft issued in September
2010. The amendments provide a practical solution to the problem of assessing whether recovery of the carrying
value of an asset will be through use or through sale by introducing a presumption that recovery will normally be through
sale. As a result of the amendments, SIC-21 Income Taxes – Recovery of Revalued Non-Depreciable Assets would no longer