Airbus 2015 Annual Report Download - page 197

2.1 Basis of Presentation
AIRBUS GROUP FINANCIAL STATEMENTS 2015 l 15 l
Notes to the IFRSConsolidatedFinancialStatements
2.
2.1 Basis of Presentation
1. The Company
The accompanying IFRS Consolidated Financial Statements
present the financial position and the results of operations of
AirbusGroup SE, the “Company” or “AirbusGroup”, (formerly
AirbusGroupN.V.) and its subsidiaries (the “Group”), legally
seated in Amsterdam (current registered office at Mendelweg30,
2333 CS Leiden, The Netherlands). On 28May 2015, the legal
form of the Group has changed from a Dutch public limited
company (N.V.) to a European company (SE) and is consistently
subject to the laws of the Dutch Civil Code. AirbusGroup is listed
on the European stock exchanges in Paris, Frankfurt am Main,
Madrid, Barcelona, Valencia and Bilbao. The IFRS Consolidated
Financial Statements were authorised for issue by the Group’s
Board of Directors on 23February 2016. They are prepared
and reported in euro (“€”) and all values are rounded to the
nearestmillion appropriately.
2. Significant Accounting Policies
Basis of preparation — The Group’s Consolidated Financial
Statements are prepared in accordance with International
Financial Reporting Standards (“IFRS”), issued by the
International Accounting Standards Board (“IASB”) as endorsed
by the European Union (“EU”) and with Part9 of Book2 of the
Netherlands Civil Code. When reference is made to IFRS, this
intends to be EU-IFRS. The Consolidated Financial Statements
have been prepared on a historical cost basis, unless otherwise
indicated.
AirbusGroup describes the accounting policies applied in each
of the individual notes to the financial statements and avoids
repeating the text of the standard, unless this is considered
relevant to the understanding of the note’s content. The most
significant accounting policies are set out below:
Revenue recognition — Revenue is recognised to the extent that
it is probable that the economic benefit arising from the ordinary
activities of the Group will flow to the Group, that revenue can be
measured reliably and that the recognition criteria, for each type
of revenue-generating activity (sales of goods and services and
construction contracts), have been met. Revenue is measured at
the fair value of the consideration received or receivable.
Revenues from the sale of commercial aircraft are
recognised when the aircraft is delivered, risks and rewards of
ownership have been transferred to the customer and revenues
can be measured reliably except for launch customer contracts
(see “Revenue from construction contracts”). Revenues from
sales of aircraft (and related cost of sales) always include the
engine component. Customers will generally benefit from a
concession from the engine manufacturer, negotiated directly
between the customer and the engine manufacturer. When
reliable information exists, the engine prices considered in our
revenues (and cost of sales) reflect the effect of the concessions.
Revenue from construction contracts — Construction contract
accounting is applied for military programmes, space projects as
well as for launch customer contracts in the civil aircraft business
if customers have significantly influenced the structural design
and technology of the aircraft type under the contract. As a
result of certain airline customers’ increasing involvement in
the development and production process of the A350XWB
programme, the Group applies IAS11 to a fixed number of
launch customer contracts of the A350XWB programme. When
the outcome can be estimated reliably, revenues and contract
costs are recognised as revenue and expensed respectively by
reference to the percentage of completion of the contract activity
at the end of the reporting period (“PoC method”). Contract
revenues include the purchase price agreed with the customer
considering escalation formulas, contract amendments and
claims and penalties when assessed as probable. The PoC
method used depends on the contract. The method is based
either on inputs (i.e. costs incurred for development contracts) or
outputs (i.e. contractually agreed technical milestones, delivered
units).
Whenever the outcome of a construction contract cannot
be estimated reliably – for example during the early stages
of a contract or during the course of a contract’s completion
– all related contract costs that are incurred are immediately
expensed and revenues are recognised only to the extent of
those costs being recoverable (the “early stage”, also called
“zero profit margin” method of accounting) (see Note3 “Key
estimates and judgements”).
Provision for loss making contracts — The Group records
provisions for loss making contracts when it becomes probable
that the total contract costs will exceed total contract revenues.
Before a provision for loss making contracts is recorded, the
Financial Statements 2015
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Annual Report 2015 Financial Statements 2015
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