Vodafone 1997 Annual Report Download - page 27

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Vodafone Group Plc Annual Report & Accounts for the year ended 31 March 1997
Basis of accounting
The financial statements have been prepared in accordance with applicable accounting standards. The
particular accounting policies adopted are described below.
The financial statements comply with two new accounting standards issued by the Accounting Standard
Board : FRS 1 (Revised) - 'Cash Flow Statements' and FRS 8 - 'Related Party Disclosures'. The
implementation of FRS 1 (Revised) has necessitated the restatement of comparative data.
Accounting convention
The financial statements are prepared under the historical cost convention.
Basis of consolidation
The Group financial statements consolidate the financial statements of the Company and its subsidiaries
and include the Group's share of results of associated undertakings for financial statements made up to 31
March 1997.
Goodwill
The surplus of cost over fair value attributed to the net assets (excluding goodwill) of subsidiary or
associated undertakings acquired during the year is written-off directly to reserves.
Foreign currencies
Transactions in foreign currencies are recorded at the exchange rates ruling on the dates of those
transactions, adjusted for the effects of any hedging arrangements. Foreign currency monetary assets and
liabilities, including the Group's interest in the underlying net assets of associates, are translated into
sterling at year end rates.
The results of the overseas subsidiary and associated undertakings are translated into sterling at average
rates of exchange. The adjustment to year end rates is taken to reserves. Exchange differences which arise
on the retranslation of overseas subsidiary and associated undertakings' balance sheets at the beginning of
the year and equity additions and withdrawals during the financial year are dealt with as a movement in
reserves.
Other translation differences are dealt with in the profit and loss account.
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