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Annual Report & Accounts 2015 - NOTES
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1.19 finance leases management applies judgment in considering the substance of a lease agreement and whether it transfers substantially all the risks and rewards incidental to ownership of the leased asset. Key factors considered include the length of the lease term in relation to the economic life of the asset, the present value of the minimum lease payments in relation to the asset's fair value, and whether the Group obtains ownership of the asset at the end of the lease term. the interest element of lease payments is charged to profit or loss, as finance costs over the period of the lease. 1.20 operating leases all other leases other than finance leases are treated as operating leases. Where the Group is a lessee, payments on operating lease agreements are recognised as an expense on a straight-line basis over the lease term. associated costs, such as maintenance and insurance, are expensed as incurred. 1.21 new and revised standards that are effective for annual periods beginning on or after 1 January 2015 1.21.1 defined Benefit Plans: employee Contributions (amendments to ias 19) defined Benefit Plans: employee Contributions (amendments to ias 19) came into mandatory effect for the first time in 2015. as the Company does not operate any defined benefit plans, there is no impact on these financial statements. 1.22 standards in issue, not yet effective at the date of authorisation of these financial statements, certain new standards, and amendments to existing standards have been published by the iasB that are not yet effective, and have not been adopted early by the Group. information on those expected to be relevant to the Group's financial statements is provided below. management anticipates that all relevant pronouncements will be adopted in the Group's accounting policies for the first period beginning after the effective date of the pronouncement. New standards, interpretations and amendments not either adopted or listed below are not expected to have a material impact on the Group's financial statements. 1.22.1 iFRs 9 'Financial instruments' (2014) the iasB has released iFRs 9 'Financial instruments' (2014), representing the completion of its project to replace ias 39 'Financial instruments: Recognition and measurement'. the new standard introduces extensive changes to ias 39's guidance on the classification and measurement of financial assets and introduces a new 'expected credit loss' model for the impairment of financial assets. iFRs 9 also provides new guidance on the application of hedge accounting. the Group's management have yet to assess the impact of iFRs 9 on these consolidated financial statements. the new standard is required to be applied for annual reporting periods beginning on or after 1 January 2018. 1.22.2 iFRs 15 'Revenue from Contracts with Customers' iFRs 15 presents new requirements for the recognition of revenue, replacing ias 18 'Revenue', ias 11 'Construction Contracts', and several revenue-related interpretations. the new standard establishes a control-based revenue recognition model and provides additional guidance in many areas not covered in detail under existing iFRss, including how to account for arrangements with multiple performance obligations, variable pricing, customer refund rights, supplier repurchase options, and other common complexities. iFRs 15 is effective for reporting periods beginning on or after 1 January 2018. the Group's management have not yet assessed the impact of iFRs 15 on these consolidated financial statements. 1.22.3amendments to iFRs 11 Joint arrangements these amendments provide guidance on the accounting for acquisitions of interests in joint operations constituting a business. the amendments require all such transactions to be accounted for using the principles on business combinations accounting in iFRs 3 'Business Combinations' and other iFRss except where those principles conflict with iFRs 11. acquisitions of interests in joint ventures are not impacted by this new guidance. the amendments are effective for reporting periods beginning on or after 1 January 2016. the Group's management have yet to assess the impact of iFRs 11 on these consolidated financial statements. 1.22.4 iFRs 16 'leases' iFRs 16 presents new requirements for the recognition, measurement, presentation and disclosure of leases, replacing ias 17 'leases'. the standard provides a single lessee accounting model, requiring lessees to recognise assets and liabilities for all leases of over 12 months unless the underlying asset has a low value. lessors continue to classify leases as operating or finance leases, with minimal changes from ias 17. the new standard applies to annual reporting periods beginning on or after 1 January 2019. the Group's management have not yet assessed the impact of iFRs 16 on these consolidated financial statements. GVC HOLDINGS PLC ANNUAL REPORT 2015 61 notes to the consolidated financial statements