Page 66 - Forterra

64 FORTERRA
ANNUAL REPORT 2012
NOTES TO THE
FINANCIAL STATEMENTS
3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(a) Basis of consolidation (Continued)
(iv) Loss of control
Upon the loss of control, the Group derecognises the assets and liabilities of the
subsidiary, any non-controlling interests and the other components of equity related
to the subsidiary.
Any surplus or deficit arising on the loss of control is recognised in profit or loss. If the
Group retains any interest in the previous subsidiary, then such interest is measured
at fair value at the date that control is lost. Subsequently, it is accounted for as an
equity-accounted investee or as an available-for-sale financial asset depending on the
level of influence retained.
(v) Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised income and expenses arising
from intra-group transactions, are eliminated in preparing the consolidated financial
statements. Unrealised gains arising from transactions with associates and joint ventures
are eliminated against the investment to the extent of the Group’s interest in the
investee. Unrealised losses are eliminated in the same way as unrealised gains, but only
to the extent that there is no evidence of impairment.
(b) Foreign currency
(i) Foreign currency transactions
Transactions in foreign currencies are translated to the respective functional currencies
of Group entities at exchange rates at the dates of the transactions. Monetary assets
and liabilities denominated in foreign currencies at the end of the reporting period are
translated to the functional currency at the exchange rate at that date. The foreign
exchange differences are recognised in profit or loss.
Non-monetary assets and liabilities denominated in foreign currencies that are measured
at fair value are translated to the functional currency at the exchange rate at the date
that the fair value was determined. Non-monetary items in a foreign currency that are
measured at cost are translated using the exchange rate at the date of the transaction.
Foreign exchange differences arising on translation are recognised in profit or loss,
except for differences arising on the translation of qualifying cash flow hedges, which
are recognised in other comprehensive income.