Unformatted text preview: leases whenever the terms of the lease transfer substantially all the risks and rewards
of ownership to the lessee. All other leases are classified as operating leases.
Group as lessee
Assets held under finance leases are initially recognised at their fair value or, if lower, at amounts equal to the
present value of the minimum lease payments, each determined at the inception of the lease. The corresponding
liability to the lessor is included in the statement of financial position as a finance lease obligation.
Lease payments are apportioned between finance charges and reduction of the lease obligation so as to achieve a
constant rate of interest on the remaining balance of the liability. Finance charges are charged directly in expenses.
Finance leased assets are amortised on a straight line basis over the shorter of the estimated useful life of the asset
and the remaining lease term.
Operating lease payments are recognised as an expense in the income statement on a straight-line basis over the lease
term, except where another systematic basis is more representative of the time pattern in which economic benefits
from the le...
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- Spring '14
- Wellcom Group, Wellcom Group Limited