THE GROUP
FINANCIAL INFORMATION
MEASUREMENT OF FINANCIAL INSTRUMENTS
AT FAIR VALUE STOCK
Financial derivatives are carried at their respective fair values.
In cases where no information/ data is available for measuring
financial instruments at fair value, generally accepted valuation
methods are used. These may be more or less dependent on quoted
information data. As New Wave Group only holds financial
instruments whose measurement is based on quoted information,
a separate calculation is performed by the management based on
this information. For financial assets and liabilities with maturities
of less than one year, fair value is assumed to be the nominal value.
Financial instruments recognized at fair value in the balance sheet
belongs to level two in IFRS 13 hierarcy. Stock is recognised at the lower of cost, as determined by applying
the first in first out (FIFO) method, and net realisable value. The
net reali sable value is the estimated selling price less estimated
selling expenses
FINANCIAL DERIVATIVES AND HEDGE ACCOUNTING
Financial derivatives are initially and subsequently stated at fair
value. Changes in value are carried through profit/loss within
finance net for the year unless they form part of an effective hedge
relationship and hedge accounting is applied. When a derivatives
contract is concluded the Group chooses to classify the deriva-
tives as fair value hedges or cash flow hedges. New Wave Group
applies cash flow hedging for hedging of future flows. Changes
in value for hedge instruments which form part of an effective
cash flow hedge are recognised in other comprehensive income.
When a hedge instrument expires or is sold, exercised or withdrawn
or otherwise no longer meets the criteria for a hedge transaction,
any gain or loss recognised in equity until such date should remain
there, after which it is ultimately recognised as an adjustment of
expenses or income when the planned transaction or the assumed
obligation is realised in the income statement. However, if a
planned transaction or an assumed obligation is no longer expected
to occur, the cumulative gain or loss recognised in other compre-
hensive income, from the period in which the hedge is applied,
should immediately be transferred to the income statement.
Disclosures on individual hedges are provided in Note 17,
Financial instruments and financial risk management.
LEASING
Finance leases, where the Group essentially assumes all risks
and benefits associated with ownership of the leased object, are
recognised in the balance sheet at the lower of the fair value of
the leased property or the present value of the minimum lease
payments. Lease payments are allocated between funding costs
and repayment of the outstanding liability under the lease. Assets
held under a finance lease are written off over the shorter period of
the assets useful life and the lease term. Leases in which the lessor
essentially retains all risks and benefits associated with ownership
are classified as operating leases. Lease payments are expensed in
the income statement on a straight-line basis over the term of the
lease.
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INCOME TAX
CURRENT INCOME TAX
Current tax assets and tax liabilities for current and previous
periods are defined as the amount that is expected to be received
back from or paid to the tax authority. The tax rates and tax laws
applied in calculating the amount are those which have been
adopted or announced at the balance sheet date. Current tax attri-
butable to items recognised in equity and in other comprehensive
income are recognised in equity and other comprehensive income.
DEFFERED CURRENT INCOME TAX
Deferred tax is recognised at the balance sheet date in accordance
with the balance sheet method for all temporary differences that
arise between the carrying amounts and tax bases of assets and
liabilities in the consolidated accounts. Deferred tax liabilities are
accounted for taxable temporary differences. Exempt are cases
where the deferred income tax liability is incurred as a result of
goodwill impairment or where an asset or liability is accounted for
as part of a transaction which is not a business combination and
which, at the time of the transaction, neither affects the reported
profit or the taxable profit or loss (i. e. initial recognition exemption).
Deferred tax assets are recognised for all deductible temporary
differences, including carry forwards to the extent that it
is likely that a taxable profit will be available against which
the tax asset can be offset. Deferred tax assets are reviewed
at each balance sheet date and adjusted to the extent that
it is no longer probable that sufficient profits will be gene-
rated to enable all or part of the deferred tax asset to be used.
Deferred tax assets and tax liabilities are determined at the tax
rates applying for the period in which the asset is realised or the
liability is paid based on tax rates (and legislation) that have been
adopted or announced at the balance sheet date. Deferred tax
assets and tax liabilities are offset if there is a legal right to offset
the amounts against each other and the deferred tax is attributable
to the same unit in the Group and the same tax authority.