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National Grid Gas plc Annual Report and Accounts 2009/10 37
New IFRS accounting standards and interpretations not yet adopted
The following standards and interpretations were not effective for the year ended 31 March 2010. None of these are expected to have
a material impact on NGG’s consolidated results or assets and liabilities.
IFRS 3R on business combinations Makes a number of changes to the accounting for business combinations, including requirements that all
payments to purchase a business are to be recorded at fair value at the acquisition date, with some contingent
payments subsequently remeasured at fair value through income; an option to calculate goodwill based on the
parent’s share of net assets only or to include goodwill related to the minority interest; and a requirement that
all transaction costs be expensed. IFRS 3R has been adopted by the Company with effect from 1 April 2010.
IAS 27R on consolidated and individual
financial statements
Requires the effects of all transactions with non-controlling interests to be recorded in equity if there is no
change in control. The revised standard also specifies the accounting when control is lost. IAS 27R has been
adopted by the Company with effect from 1 April 2010.
Amendment to IAS 39 Financial
Instruments: Recognition and
measurement on eligible
hedged items
Prohibits designating inflation as a hedgeable component of an instrument, unless cash flows relating to the
separate inflation component are contractual and also prohibits the designation of a purchased option in its
entirety as the hedge of a one-sided risk in a forecast transaction. The amendment to IAS 39 has been adopted
by the Company with effect from 1 April 2010.
Revised IFRS 1 on first-time adoption
of IFRS
Changes the structure, while retaining the substance, of the previously issued version of IFRS 1. The revised
version of IFRS 1 has been adopted by the Company with effect from 1 April 2010.
IFRIC 17 on distribution of non-cash
assets to owners
Requires such a distribution to be measured at the fair value of the asset and any difference between the
carrying amount of the asset and its fair value to be recognised in profit or loss. IFRIC 17 has been adopted by
the Company with effect from 1 April 2010.
Improvements to IFRS 2009 Contains amendments to various existing standards. The amendments have been adopted by the Company
with effect from 1 April 2010.
Amendment to IFRS 2 on group cash
settled share based payments
Clarifies the scope and accounting for group cash settled share based payment transactions in separate or
individual financial statements when there is no obligation to settle the share based payment transaction. The
amendment to IFRS 2 has been adopted by the Company with effect from 1 April 2010.
Amendment to IFRS 1 on first time
adoption of IFRS
Provides additional exemptions for first time adopters. The amendment to IFRS 1 will be adopted by the
Company with effect from 1 April 2010, subject to endorsement by the European Union.
Amendment to IAS 32 on classification
of rights issues
Defines as an equity instrument a financial instrument that gives the holder the right to acquire a fixed number
of the entity’s equity instruments for a fixed amount of any currency, if the financial instrument is offered pro
rata to all existing owners of the same class of non-derivative equity instruments. The amendment to IAS 32
has been adopted by the Company with effect from 1 April 2010.
Revised IAS 24 on related
party disclosures
Simplifies the definition of a related party and provides a partial exemption for government-related entities. The
revised version of IAS 24 will be adopted by the Company with effect from 1 April 2011, subject to endorsement
by the European Union.
IFRS 9 on financial instruments Requires that financial assets should be classified as at either amortised cost or fair value on the basis of the
entity’s business model and contractual cash flows. IFRS 9 will be adopted by the Company with effect from 1
April 2013, subject to endorsement by the European Union.
IFRIC 19 on extinguishing financial
liabilities with equity instruments
Clarifies that equity instruments issued to extinguish a financial liability should be measured at fair value, unless
fair value cannot reasonably be determined in which case the fair value of the liabilities extinguished should be
used. IFRIC 19 will be adopted by the Company with effect from 1 April 2011, subject to endorsement by the
European Union.
Amendment to IFRIC 14 on
prepayments of a minimum funding
requirement
Permits an entity to treat early payments of contributions to cover a minimum funding requirement as an asset.
The amendment to IFRIC 14 will be adopted by the Company with effect from 1 April 2011, subject to
endorsement by the European Union.
Amendment to IFRS 1 on comparative
IFRS 7 disclosures
Provides limited disclosure exemptions in respect of financial instruments for first-time adopters of IFRS. The
amendment to IFRS 1 will be adopted by the Company with effect from 1 April 2011, subject to endorsement by
the European Union.