LensCrafters 2013 Annual Report Download - page 172

Footnotes to the statutory financial statements as of December 31, 2013 Page 5 of 71
When an impairment loss is no longer justified, the carrying amount of the asset is increased to its new estimated
recoverable amount, which may not exceed the net carrying amount that the asset would have had if no impairment
had been previously recognized. The reversal of an impairment loss is recognized immediately in the income
statement.
Share-based payments. The Company awards additional benefits in the form of stock options or incentive stock
options to employees as well as directors who habitually provide their sevices for the benefit of one or more
subsidiaries.
The Company applies IFRS 2 - Share-Based Payment to account for stock options; this requires goods or services
acquired in an equity-settled share-based payment transaction to be measured at the fair value of the goods or services
received or at the grant date fair value of the equity instruments granted. This methodology falls into Level 1 of the
fair value hierarchy identified by IFRS 7.
This amount is recognized in profit or loss on a straight-line basis over the vesting period, with a matching increase
recorded in equity; this cost is estimated by management, taking account of any vesting conditions. The fair value of
stock options is determined using the binomial model.
The Company has applied the transition provisions permitted by IFRS 2, meaning that it has applied this standard to
stock option grants approved after November 7, 2002 and not yet vested at the IFRS 2 effective date (January 1,
2005).
Under IFRS 2 - Share-Based Payment, the total grant date fair value of stock options granted to employees of
subsidiaries must be recognized in the statement of financial position, as an increase in the value of investments in
subsidiaries, with the matching entry going directly to equity. At the time of allotting shares/options to employees of a
subsidiary, Luxottica Group S.p.A. will recharge the related cost to the subsidiary, recognizing a receivable in its
regard while reducing the value of the related investment in the subsidiary. If the recharge is higher than the increase
originally recognized in the value of the investment, the difference is treated as a gain through the statement of
income.
Dividends. Dividend income is recognized when the investor's right to receive payment is established, following the
declaration of a dividend by the investee's stockholders in general meeting.
Dividends payable by the Company are recognized as changes in stockholders' equity in the period in which they are
approved by stockholders in general meeting.