106 / 148
Notes to the consolidated
financial statements
continued
for the year ended 30 June 2017
104
Hyprop Investments Limited
Integrated annual report and consolidated financial statements
2017
1.
Accounting policies and presentation of consolidated financial statements
continued
1.18 Employee benefits
continued
Post-employment benefits
Defined contribution plan
The defined contribution plan is a post-employment benefit plan under which the group pays contributions to a separate entity and has no legal or
constructive obligation to pay further amounts if the fund does not hold sufficient assets to pay all employees the benefits relating to employee
service in the current and prior periods.
The contributions are recognised as an employee benefit expense when the related services have been rendered.
Long-term benefits
Share-based payments
Equity-settled share-based employee remuneration
The group operates equity-settled share-based conditional share plans (CUP) for its employees.
The grant date fair value of equity-settled share-based payment arrangements granted to employees is recognised as an expense, with a corresponding
increase in equity, over the vesting period of the awards. The amount recognised as an expense is adjusted to reflect the number of awards for which
the related service and non-market performance conditions are expected to be met, such that the amount ultimately recognised is based on the
number of awards that meet the related service and non-market performance conditions at the vesting date.
All share-based remuneration is ultimately recognised as an expense in profit or loss, with a corresponding increase in equity. If vesting periods or
other vesting conditions apply, the expense is allocated over the vesting period, based on the best available estimate of the number of shares
expected to vest.
1.19 Revenue
Property portfolio revenue
Property portfolio revenue comprises contractual rental income, operating cost recoveries, income from marketing and promotions and parking
income. Contractual rental income (including tenant parking income) is recognised on a straight-line basis over the term of the lease. Income from
marketing, promotions and casual parking is recognised when the amounts can be reliably measured.
Turnover rentals (variable rentals based on the turnover achieved by a tenant) are included in revenue when the amounts can be reliably measured.
Interest received
Interest earned on cash invested with financial institutions is recognised on an accrual basis using the effective interest method.
1.20 Borrowing costs
Borrowing costs that are directly attributable to the acquisition or construction of a qualifying asset are capitalised as part of the cost of that asset
until such time as the asset is substantially ready for its intended use. Qualifying assets are those that necessarily take a substantial period of time to
prepare for their intended use.
The amount of borrowing costs eligible for capitalisation is the actual borrowing costs incurred on funds specifically borrowed in respect of the
qualifying asset. Investment income earned on the temporary investment of borrowings pending their expenditure on qualifying assets is deducted
from the borrowing cost capitalised. Capitalisation ceases when substantially all the activities necessary to prepare the qualifying asset for its intended
use are complete.
All other borrowing costs are recognised as an expense in the period in which they are incurred.
1.21
Taxation
1.21.1
Current taxation
Current and deferred taxes are recognised as income or an expense and included in profit or loss for the year.
The charge for current taxation includes expected tax payable or receivable on the taxable income or loss for the year and any adjustment
for taxation payable or receivable for previous years.
Current taxation liabilities/(assets) for the current and prior periods are measured at the amount expected to be paid to/(recovered from)
the taxation authorities, using the taxation rates and taxation laws that have been enacted or substantively enacted by the reporting date.
1.21.2
Deferred taxation
Deferred taxation is recognised for temporary differences between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for taxation purposes. Deferred taxation is not recognised for the following temporary differences:
■■
The initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor
taxable profit
■■
Goodwill that arises on initial recognition in a business combination
■■
Differences relating to investments in subsidiaries and jointly controlled entities to the extent that it is probable that they will not reverse
in the foreseeable future.
A deferred taxation asset is recognised for all deductible temporary differences to the extent that it is probable that taxable profit will be
available against which the deductible temporary differences can be utilised. Deferred taxation assets are reviewed at each reporting date
and are reduced to the extent that it is no longer probable that the related taxation benefit will be realised.
Deferred taxation assets and liabilities are measured at the taxation rates that are expected to apply to the period when the asset is realised
or the liability is settled, based on taxation rates and taxation laws that have been enacted or substantively enacted by the reporting date.