Experian 2013 Annual Report Download - page 110
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Please find page 110 of the 2013 Experian annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.108 Experian Annual Report 2013 Financial statements
5. Significant accounting policies (continued)
When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss
included in equity at that time remains in equity and is recognised when the forecast transaction is ultimately recognised in the Group income
statement. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was included in equity is transferred
immediately to the Group income statement.
Net investment hedges
Any gain or loss on the hedging instrument relating to the effective portion of the hedge of a net investment in an undertaking whose functional
currency is not US dollars is recognised in other comprehensive income with the gain or loss relating to the ineffective portion recognised in
net finance costs in the Group income statement. Gains and losses accumulated in equity are included in the Group income statement on the
disposal of the undertaking.
Non-hedging derivatives
Changes in the fair value of such derivative instruments are recognised immediately in the Group income statement. Costs and income
amounts in respect of derivatives entered into in connection with social security obligations on employee share incentive plans, other than
amounts of a financing nature, are charged or credited within labour costs. Other costs and changes in fair value of such derivatives are charged
or credited within financing fair value remeasurements in the Group income statement.
(l) Borrowings (note 29)
Borrowings are recognised initially at fair value, net of any transaction costs incurred. Borrowings are subsequently stated at amortised cost
except where they are hedged by an effective fair value hedge, in which case the carrying value is adjusted to reflect the fair value movements
associated with the hedged risk.
Borrowings are classified as non-current to the extent that the Group has an unconditional right to defer settlement of the liability for at least one
year after the balance sheet date.
(m) Trade payables (note 28)
Trade payables are recognised initially at fair value. Where the time value of money is material, payables are then carried at amortised cost using
the effective interest rate method.
(n) Retirement benefit assets and obligations (note 36)
Defined benefit pension arrangements – funded plans
The retirement benefit assets and obligations recognised in the Group balance sheet in respect of funded plans comprise the fair value of plan
assets of funded plans less the present value of the related defined benefit obligation at the balance sheet date, together with adjustments
for past service costs. The defined benefit obligation is calculated annually by independent qualified actuaries using the projected unit credit
method. Under this method, and in view of the fact that the principal Experian funded plan is closed to new entrants, the current service cost
increases as members approach retirement due to the ageing active membership of the plan.
The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using market yields
available at the assessment date on high-quality corporate bonds that are denominated in the currency in which the benefits will be paid, and
that have terms to maturity consistent with the estimated average term of the related pension liability.
Actuarial gains and losses arising from experience adjustments, and changes in actuarial assumptions, are recognised immediately in the
Group statement of comprehensive income.
The pension cost recognised in the Group income statement comprises the cost of benefits accrued plus interest on the defined benefit
obligation less the expected return on the plan assets over the year. Service costs and financing income and expenses are recognised
separately in the Group income statement. Plan expenses are deducted from the expected return on the plan assets over the year.
Defined benefit pension arrangements – unfunded plans
Unfunded pension obligations are determined and accounted for in accordance with the principles used in respect of the funded arrangements.
Defined contribution pension arrangements
The assets of defined contribution plans are held separately from those of the Group in independently administered funds. The pension cost
recognised in the Group income statement represents the contributions payable by the Group to these funds in respect of the year.
Notes to the Group financial statements continued