LensCrafters 2015 Annual Report Download - page 97

Notes to the consolidated financial statement as of December 31, 2015 Page 3 di 68
1. CONSOLIDATION PRINCIPLES, COMPOSITION OF THE GROUP AND SIGNIFICANT ACCOUNTING
POLICIES
CONSOLIDATION PRINCIPLES
Subsidiaries
Subsidiaries are any entities over which the Group has control. The Group controls an entity when the Group is exposed to, or
has the rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its
power over the entity. Power is generally presumed with an ownership of more than one-half of the voting rights. The existence
and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the
Group controls another entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group.
They are deconsolidated from the date that control ceases.
The Group uses the acquisition method of accounting to account for business combinations. The consideration transferred for
the acquisition of a subsidiary is measured as the fair value of the assets transferred, the liabilities incurred and the equity
interests issued by the Group. The consideration transferred includes the fair value of any asset or liability resulting from a
contingent consideration arrangement. Acquisition-related costs are expensed as incurred. Identifiable assets acquired and
liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the
acquisition date. On an acquisition-by-acquisition basis, the Group recognizes any non-controlling interest in the acquiree at
either fair value or the non-controlling interest’s proportionate share of the acquiree’s net assets.
The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree and the acquisition date
fair value of any previous equity interest in the acquiree over the fair value of the Group’s share of the identifiable net assets
acquired is recorded as goodwill. If this is less than the fair value of the net assets of the subsidiary acquired in the case of a
bargain purchase, the Group makes a new assessment of the net assets acquired and any residual difference is recognized
directly in the consolidated statement of income.
In business combinations achieved in stages, the Group remeasures its previously held equity interest in the acquiree at its
acquisition date fair value and recognizes the resulting gain or loss in the consolidated statement of income.
Inter-company transactions, balances and unrealized gains and losses on transactions between Group companies are eliminated.
Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by
the Group.
The individual financial statements used in the preparation of the consolidated financial statements are prepared and approved
by the administrative bodies of the individual companies.
Transactions with equity owners
Transactions such as contributions from owners in their capacity as owners of the entity are recorded in equity.
Transactions with non-controlling interests are treated as transactions with equity owners of the Group. For purchases from
non-controlling interests, the difference between any consideration paid and the relevant share acquired of the carrying value of
net assets of the subsidiary is recorded in equity. Gains or losses on disposals to non-controlling interests are also recorded