Annual Report 2011 - QuamIR

Notes to the Consolidated Financial StatementsFor the year ended 31 March 20113. Significant Accounting Policies (continued)Revenue recognitionRevenue is measured at the fair value of the consideration received or receivable. Revenue is reducedfor estimated customer returns, rebates and other similar allowances.Revenue from the sale of goods is recognized when all the following conditions are satisfied:• the Group has transferred to the buyer the significant risks and rewards of ownership of thegoods;• the Group retains neither continuing managerial involvement to the degree usually associatedwith ownership nor effective control over the goods sold;• the amount of revenue can be measured reliably;• it is probable that the economic benefits associated with the transaction will flow to the Group;and• the costs incurred or to be incurred in respect of the transaction can be measured reliably.Specifically, revenue from the sale of goods is recognized when goods are delivered and legal title ispassed.Interest income from a financial asset is recognized when it is probable that the economic benefits willflow to the Group and the amount of revenue can be measured reliably. Interest income is accrued ona time basis, by reference to the principal outstanding and at the effective interest rate applicable,which is the rate that exactly discounts estimated future cash receipts through the expected life of thefinancial asset to that asset’s net carrying amount on initial recognition.Annual Report 201153