Axiom 2014 Annual Report - page 51

Notes to the Financial Statements
for the year ended 30 September 2014
49
2014 Annual Report
2. Significant accounting policies
––
the ability to farm out all or part of its exploration
projects; and
––
the ability to sell particular exploration projects.
Accordingly, the Directors are confident in the ability
of the Group and the Company to successfully secure
sufficient cash inflows to enable it to continue as a going
concern and that it is appropriate to adopt the going
concern basis of accounting in the preparation of the
financial statements.
c. Principles of consolidation
The consolidated financial statements incorporate all of
the assets, liabilities and results of the parent (Axiom
Mining Limited) and all of the subsidiaries (including
any structured entities). Subsidiaries are entities that
the parent controls. The parent controls an entity when
it is exposed to, or has rights to, variable returns from its
involvement with the entity and has the ability to affect
those returns through its power over the entity. A list of
the subsidiaries is provided in Note 9.
The assets, liabilities and results of all subsidiaries are
fully consolidated into the financial statements of the
Group from the date on which control is obtained by the
Group. The consolidation of a subsidiary is discontinued
from the date that control ceases. Intercompany
transactions, balances and unrealised gains or losses
on transactions between Group entities are fully
eliminated on consolidation. Accounting policies of
subsidiaries have been changed and adjustments made
where necessary to ensure uniformity of the accounting
policies adopted by the Group.
Equity interests in a subsidiary not attributable, directly
or indirectly, to the Group are presented as “non-
controlling interests”. The Group initially recognises non-
controlling interests that are present ownership interests
in subsidiaries and are entitled to a proportionate share
of the subsidiary’s net assets on liquidation at either fair
value or at the non-controlling interests’ proportionate
share of the subsidiary’s net assets. Subsequent to initial
recognition, non-controlling interests are attributed
their share of profit or loss and each component of
other comprehensive income. Non-controlling interests
are shown separately within the equity section of
the statement of financial position and statement of
comprehensive income.
d. Business combinations
A business combination is accounted for by applying the
acquisition method, unless it is a combination involving
entities or businesses under common control. The
business combination will be accounted for from the
date that control is attained, whereby the fair value of
the identifiable assets acquired and liabilities (including
contingent liabilities) assumed is recognised (subject to
certain limited exemptions).
When measuring the consideration transferred in the
business combination, any asset or liability resulting
from a contingent consideration arrangement is also
included. Subsequent to initial recognition, contingent
consideration classified as equity is not re-measured and
its subsequent settlement is accounted for within equity.
Contingent consideration classified as an asset or liability
is re-measured in each reporting period to fair value,
recognising any change to fair value in profit or loss,
unless the change in value can be identified as existing
at acquisition date.
All transaction costs incurred in relation to business
combinations, other than those associated with the issue
of a financial instrument, are recognised as expenses in
profit or loss when incurred.
The acquisition of a business may result in the
recognition of goodwill or a gain from a bargain
purchase.
e. Fair value of assets and liabilities
The Group measures some of its assets and liabilities
at fair value on either a recurring or non-recurring
basis, depending on the requirements of the applicable
Accounting Standard.
Fair value is the price the Group would receive to sell an
asset or would have to pay to transfer a liability in an
orderly (i.e. unforced) transaction between independent,
knowledgeable and willing market participants at the
measurement date.
As fair value is a market-based measure, the closest
equivalent observable market pricing information is
used to determine fair value. Adjustments to market
values may be made having regard to the characteristics
of the specific asset or liability. The fair values of assets
and liabilities that are not traded in an active market
are determined using one or more valuation techniques.
These valuation techniques maximise, to the extent
possible, the use of observable market data.
To the extent possible, market information is extracted
from either the principal market for the asset or liability
(i.e. the market with the greatest volume and level of
activity for the asset or liability) or, in the absence of
such a market, the most advantageous market available
to the entity at the end of the reporting period (i.e. the
market that maximises the receipts from the sale of the
asset or minimises the payments made to transfer the
liability, after taking into account transaction costs and
transport costs).
GROUP FINANCIAL REPORT
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