LensCrafters 2011 Annual Report Download - page 189

| 113 >CONSOLIDATED FINANCIAL STATEMENTS - NOTES
Intangible assets with a definite useful life are subject to amortization and are reviewed
for impairment whenever events or changes in circumstances indicate that the carrying
amount may not be recoverable. An impairment loss is recognized for the amount by which
the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is
the higher of an asset’s fair value less costs to sell and value in use.
For the purposes of assessing impairment, intangible assets are grouped at the lowest levels
for which there are separately identifiable cash flows (cash-generating units). Intangible
assets other than goodwill are reviewed at each reporting date to assess whether there is
an indication that an impairment loss recognized in prior periods may no longer exist or
has decreased. If such an indication exists, the loss is reversed and the carrying amount
of the asset is increased to its recoverable amount which may not exceed the carrying
amount that would have been determined if no impairment loss had been recorded.
The reversal of an impairment loss is recorded in the consolidated statement of income.
Financial assets
The financial assets of the Group fall into the following categories:
(a) Financial assets at fair value through profit and loss
Financial assets at fair value through profit or loss are financial assets held for
trading. A financial asset is classified in this category if acquired principally for the
purpose of selling in the short term. Derivatives are also categorized as held for
trading unless they are designated as hedges. Assets in this category are classified
as current assets. In this case, the subsequent fair value changes are recorded based
on specific criteria. For further information, refer to the paragraph, “Derivative
financial instruments”.
The assets in this category are classified as current assets and recorded at their
fair value at the time of their initial recognition. Transaction costs are immediately
recognized in the consolidated statement of income.
After initial recognition, financial assets at fair value through profit and loss are
measured at their fair value each reporting period. Gains and losses deriving
from changes in fair value are recorded in the consolidated statement of income
in the period in which they occur. Dividend income from financial assets at
fair value through profit or loss is recognized in the consolidated statement of
income as part of other income when the Group’s right to receive payments is
established.
(b) Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable
payments that are not quoted in an active market. They are included in current assets,
except for those with maturities greater than 12 months or which are expected to be
repaid within 12 months after the end of the reporting period. These are classified as