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BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED
ANNUAL REPORT 2013
b) Cash and cash equivalents
Cash and cash equivalents comprises cash on hand, balances with commercial banks, deposits with Central Bank (excluding
mandatory reserve deposits) and term deposits with an original maturity of three months or less from the acquisition date.
c) Business combinations and goodwill
Business combinations are accounted for using the acquisition method as at the acquisition date – i.e. when control is
transferred to the Group. The cost of an acquisition is measured as the aggregate of the consideration transferred, measured
at acquisition date fair value and the amount of any non-controlling interest in the acquiree. For each business combination,
the acquirer measures the non-controlling interest in the acquiree either at fair value or at the proportionate share of the
acquiree’s identifiable net assets. Acquisition costs incurred are expensed and included in the statement of income. If the
cost of acquisition is less than the fair values of the identifiable net assets acquired, the discount on acquisition is recognised
directly in the income statement in the year of acquisition.
Goodwill acquired in a business combination is initially measured at cost, being the excess of the cost of the business
combination over the net fair value of the identifiable assets, liabilities and contingent liabilities acquired.
Following initial recognition, goodwill is measured at cost less any accumulated impairment losses. Goodwill is reviewed
for impairment annually, or more frequently, if events or changes in circumstances indicate that the carrying value may be
impaired. For the purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date,
allocated to each of the Group’s cash–generating units (CGUs) or group of CGUs, which are expected to benefit from the
synergies of the combination, irrespective of whether other assets or liabilities of the acquiree are assigned to those units.
Each unit to which the goodwill is allocated represents the lowest level within the Group at which the goodwill is monitored
for internal management purposes. Goodwill is included in the statement of financial position in intangible assets.
d) Intangible assets
Intangible assets are recognised only when their cost can be measured reliably and it is probable that the expected future
economic benefits that are attributable to it will flow to the acquirer.
Intangible assets with finite lives are amortised over the useful economic life and assessed for impairment whenever there
is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method for an
intangible asset with a finite useful life is reviewed at least at the end of each reporting period. Changes in the expected
useful life or the expected pattern of consumption of future economic benefits embodied in the asset is accounted for
by changing the amortisation period or method, as appropriate, and are treated as changes in accounting estimates. The
amortisation expense on intangible assets with finite lives is recognised in the income statement.
Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal
proceeds and the carrying amount of the asset and are recognised in the income statement when the asset is derecognised.
e) Financial instruments
The Group initially recognises loans and advances, deposits and loans payable on the date that they are originated. All
other financial assets and liabilities are initially recognised on the trade date, i.e., the date that the entities within the Group
become a party to the contractual provisions of the instrument.
The classification of financial instruments at initial recognition depends on the purpose and the management’s intention for
which the financial instruments were acquired and their characteristics. All financial instruments are measured initially at
cost being their fair value plus transaction costs that are directly attributable to its acquisition or issue.
Financial assets
The Group derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers
the rights to receive the contractual cash flows in a transaction in which substantially all the risks and rewards of ownership
of the financial asset are transferred. Any interest in such transferred financial assets that is created or retained by the Group
is recognised as a separate asset or liability.
The Group classifies its financial assets in the following categories: held to maturity, available-for-sale and loans and
receivables.
Notes to the Consolidated Financial Statements
For the year ended March 31, 2013, with comparative figures for 2012
(Expressed in Barbados dollars)
