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GB Auto and its Subsidiaries (S.A.E)
Notes to the Consolidated Financial Statements
For the year ended 31 December 2012
(In the notes all amounts are shown in thousand Egyptian pounds unless otherwise stated)
57
GB Auto
•
2012 ANNUAL REPORT
Changes in the fair value of monetary securities denominated in foreign currency classified as available-for-sale are analysed between
translation differences resulting from changes in the amortised cost of the security, and other changes in the carrying amount of the
security. Translation differences related to changes in amortised cost are recognised in profit or loss, and other changes in carrying
amount are recognised in equity.
Translation differences on non-monetary financial assets and liabilities are reported as part of the fair value gain or loss. Translation
differences on non-monetary financial assets and liabilities such as equities held at fair value through profit or loss are recognised in
profit or loss as part of the fair value gain or loss. Translation differences on non-monetary financial assets such as equities classified
as available-for-sale are included in the available-for-sale reserve in equity.
(3)Group companies
The results and financial position of all the Group entities that have a functional currency different from the presentation currency
are translated into the presentation currency as follows:
•
Assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that balance sheet;
•
Income and expenses for each income statement are translated at average exchange rates during the year (unless this average is
not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income
and expenses are translated at the rate on the dates of the transactions); And all resulting exchange differences are recognised as a
separate component of equity.
•
The foreign currency exchange results arising from translation of the net investment in entities and loans or financial instruments
in foreign currencies allocated to cover these investments are recognized in the equity on the consolidate financial statement. The
foreign currencies exchange charged to the equity are recognized as part of gain or loss upon the disposal of these investments.
D. Property, plant and equipment
Property, plant and equipment are stated at historical cost less depreciation. Historical cost includes expenditure that is directly at-
tributable to the acquisition of the items.
Depreciation is calculated using the straight-line method to write off the cost of each asset to its residual values over the estimated
useful lives of assets excluding land, which is not depreciated. Estimated depreciation rates of assets are as follows:
Buildings
2% - 4%
Machinery & equipment
10% - 20%
Vehicles
20% - 25%
Fixtures & office furniture
6% - 33%
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each balance sheet date
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its
estimated recoverable amount.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised within other
gains (losses) – net, in the income statement.
Repairs and maintenance are charged to the statement of income during the financial year in which they are incurred. The cost of
major renovations are included in the carrying amount of the asset when it is probable that future economic benefits in excess of the
originally assessed standard of performance of the existing asset will flow to the Group. Major renovations are depreciated over the
remaining useful life of the related asset or the estimated useful life of the renovation, whichever is less.
E. Intangible assets
i. Goodwill
Goodwill represents the excess of the cost of an acquisition over the fair value of the Group’s share of the net identifiable assets of
the acquired subsidiary/associate at the date of acquisition. Goodwill on acquisitions of subsidiaries is included in intangible assets.
Goodwill on acquisitions of associates is included in investments in associates.