Tiscali 2013 Annual Report Download - page 135

Annual financial report as at 31 December 2013
Date
File Name
Status
Page
-
Annual Report as at 31
December 2013
135
Remuneration schemes involving interests in the share capital
The Group has assigned certain members of senior management and employees additional benefits
via plans for interests in the share capital (stock option plans). These plans expired on 3 May 2012.
The cost, represented by the fair value of the stock options as of the date of allocation was recorded,
for accounting purposes in accordance with IFRS 2- Share-based payment in the income statement
with a matching balance directly under shareholders’ equity.
Provisions for risks and charges
Provisions for risks and charges relating to potential legal and tax liabilities are established following
estimates performed by Directors on the basis of judgements developed by the Group legal and tax
advisors, concerning the charges that are reasonably deemed to be incurred in order to settle the
obligation. If in relation to the final result of such judgements, the Group is called upon to fulfil an
obligation for a sum other than that estimated, the related effects are reflected in the income
statement.
Treasury shares
Treasury shares are booked to reduce the shareholders’ equity.
Revenue recognition
Revenues are recognised to the extent that it is probable that financial profits will flow to Tiscali S.p.A.
and their amount can be reasonably estimated; they are represented net of discounts, allowances and
returns.
Revenues for the provision of services are stated in the income statement with reference to the stage
of completion of the service and only when the result of the service can be reliably estimated.
Financial income and charges
Interest received and paid is recognised using the effective interest rate method.
Taxes
Income tax expense for the year includes the tax currently payable and deferred tax.
The tax currently payable is based on taxable income for the year. Taxable income differs from the
result reported in the income statement because it excludes items of income or expense that are
taxable or deductible in other years and it also excludes items that are never taxable or deductible.
Liability for current tax is calculated using tax rates applicable at the balance sheet date.
Critical decisions in applying accounting standards and in the use of estimates
In the process of applying the accounting standards disclosed in the previous section, Tiscali’s
directors made some significant decisions in view of the recognition of amounts in the financial
statements. The directors’ decisions are based on historical experience as well as on expectations
associated with the realisation of future events, considered reasonable under the circumstances.
Assessment of whether primary assets reported can be recovered is based on the estimate of income
and financial flows the Group feels it will be able to generate in the future. As more fully described in
the note “Assessment of the business as a going-concern”, achieving the results set forth in the
business and financial plan, used for the assessment, depends on whether the forecasts and