Registration Document - Pernod Ricard

4 Notes
86
ANNUAL CONSOLIDATED FINANCIAL STATEMENTS
to the annual consolidated fi nancial statements
fair value of plan assets (termed the “corridor” method). Recognition
of the provision is on a straight-line basis over the average number
of remaining years’ service of the employees in the plan in question
(amortisation of actuarial gains and losses). The expense recognised
in respect of the benefit obligations described above incorporates:
◆ expenses corresponding to the acquisition of an additional year’s
rights;
◆ interest cost;
◆
income corresponding to the expected return on plan assets;
◆ income or expense corresponding to the amortisation of actuarial
gains and losses;
◆ past service cost; recognised on a straight-line basis over the
average residual period until the corresponding benefits vest with
employees;
◆ income or expense related to changes to existing plans or the
creation of new plans;
◆ income or expense related to any plan curtailments or
settlements.
The expense arising from the change in net obligations for pensions
and other long-term employee benefits is recognised within operating
profit or within interest (expense) income on the basis of the nature
of the underlying.
The Group does not participate in multi-employer plans.
19. Sales
Revenue is measured at the fair value of the consideration received
or to be received, after deducting trade discounts, volume rebates
and sales-related taxes and duties. Sales are recognised when the
significant risks and rewards of ownership have been transferred,
generally at the date of transfer of ownership title.
19.1 Cost of services rendered
in connection with sales
Pursuant to IAS 18 (Revenue), certain costs of services rendered in
connection with sales, such as advertising programmes in conjunction
with distributors, listing costs for new products and promotional
activities at point of sale, are deducted directly from sales if there
is no separately identifiable service whose fair value can be reliably
measured.
19.2 Duties and taxes
In accordance with IAS 18, certain import duties, in Asia for instance,
are classified as cost of sales, as these duties are not specifically
re-billed to customers (as is the case for Social s ecurity stamps in
France, for example).
19.3 Discounts
In accordance with IAS 18, early payment discounts are not considered
to be financial transactions, but rather are deducted directly from
sales.
PERNOD RICARD
20. Gross margin after logistics costs,
contribution after advertising &
promotion expenses, profit from
recurring operations and other
income and expenses
Gross margin after logistics costs refers to sales (excluding duties
and taxes), less cost of sales and logistics costs. The contribution
after advertising and promotional expenses is the gross margin
after deducting logistics, advertising and promotional costs. Profit
from recurring operations is the contribution after advertising
and promotional expenses less trading costs and overheads. This
is the indicator used internally to measure the Group’s operational
performance. It excludes other income and expenses, such as those
relating to restructuring and integration, capital gains and losses
on disposals and other non-recurring income and expenses. These
other operating income and expenses are excluded from profit from
recurring operations because the Group believes they have little
predictive value due to their occasional nature. They are described in
detail in Note 7.
21. Deferred tax
Deferred tax is recognised on temporary differences between the tax
and book value of assets and liabilities in the consolidated balance
sheet and is measured using the balance sheet approach. The effects
of changes in tax rates are recognised in shareholders’ equity or in
profit and loss in the year in which the change of tax rates is decided.
Deferred tax assets are recognised in the balance sheet when it is more
likely than not that they will be recovered in future years. Deferred
tax assets and liabilities are not discounted. In order to evaluate the
Group’s ability to recover these assets, account is notably taken of
forecasts of future taxable profits.
22. Share-based payment
In accordance with the option provided by IFRS 1, the Group applies
IFRS 2 (Share-based payment) as of 1 July 2004, to all instruments
granted after 7 November 2002 and not yet fully vested at 1 July
2004. The Group applies this standard to transactions whose award
and settlement are share-based and to transactions whose award is
share-based but which are settled in cash.
In application of this standard, stock options granted to employees are
measured at fair value. The amount of such fair value is recognised in
profit and loss over the vesting period of the rights and a corresponding
double entry is recognised as an increase in shareholders equity.
Share appreciation rights, which will be settled in cash, are measured
at fair value and recognised in profit and loss with a corresponding
double entry to the liability incurred. This liability is remeasured at
each balance sheet date until settlement.
The fair value of options and rights is calculated using the binomial
valuation model taking into account the characteristics of the plan
and market data at the date of grant and on the basis of Group
management assumptions.
I REFERENCE DOCUMENT 2008/2009 I