Annual Financial Statements
ACCOUNTING POLICIES for the year ended 31 March 2011
1.2 Significant judgements( continued) Provisions Provisions were raised and management determined an estimate based on the information available. Additional disclosure of these estimates of provisions are included in note 6 – Provisions
Contingencies Management used their judgement in deciding to reflect the surplus as a contingent liability based on past experience whereby the previous year’ s surplus was approved.
Property plant and equipment In determining the useful life and residual value of each category of property, plant and equipment management took into consideration the nature and use of each asset type.
Leased office equipment and leasehold improvements are depreciated over the lease period with no residual value.
Intangible assets In determining the useful life of computer software management took into consideration that the software will have to be upgraded every three to four years. The residual value of computer software is regarded as zero due to the fact that computer software is not resaleable.
1.3 Going concern The annual financial statements have been prepared on a going concern basis and the accounting policies have been applied consistently through the year.
1.4 Related party transactions Parties are considered to be related if one party has the ability to control the National Consumer Tribunal or able to exercise significant influence or joint control over the National Consumer Tribunal in making financial and operating decisions. A related party transaction is a transfer of resources, services or obligations between related parties regardless of whether a price is charged.
1.5 Contingent liabilities A contingent liability is disclosed in the notes to the annual financial statements when a possible obligation arises from past events, and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the National Consumer Tribunal. Each class of contingent liability at the reporting date, a brief description of the nature of the contingent liability and its possible financial effects is disclosed.
1.6 Revenue recognition
1.6.1 Revenue from exchange transactions Revenue is the gross inflow of economic benefits or service potential received and receivable by an entity which results in an increase in net assets. An exchange transaction is one in which the entity receives assets or services or has liabilities extinguished and directly gives equal value to the other party in exchange.
Annual Report 2011 page 82 | national consumer tribunal