ECIC IR 2023

ANNUAL Financial Statements for the year ended 31 March 2023

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Accounting Policies

1.6 Foreign currency translation Functional and presentation currency

The financial statements are presented in South African Rand, which is the presentation currency of the shareholder. The US Dollar is the functional currency for the Corporation, the functional currency being the currency of the primary economic environment in which the Corporation operates. The services offered by the Corporation are predominantly priced in US Dollars. Reporting foreign currency transactions to functional currency Foreign currency transactions are transactions that are denominated or require settlement in a foreign currency. A foreign currency transaction shall be recorded, on initial recognition in the functional currency, by applying to the foreign currency amount the spot exchange rate between the functional currency and the foreign currency at the date of the transaction. At the end of each reporting period: c All foreign currency monetary items are translated using the closing rate; c Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction; and c Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was measured. Exchange differences arising on the settlement of monetary items or on translating monetary items at rates different from those at which they were translated on initial recognition during the period or in previous financial statements are recognised in the statement of comprehensive income in the period in which they arise. A monetary item is a right to receive (or an obligation to deliver) a fixed or determinable number of units of currency including units of currency held. Non-monetary items are all other assets and liabilities where there is an absence of a right to receive (or an obligation to deliver) a fixed or determinable number of units of currency. Translation from functional to presentation currency The annual financial statements are translated from the functional currency to the presentation currency using the average rate or spot rate at transaction date for statement of comprehensive income items and the closing rate for the statement of financial position items, comprising both monetary and non-monetary items. Average rates are used for transactions where there are multiple transaction dates that are not easily identifiable and spot rates are used for transactions where the transaction date is easily identifiable. The resulting exchange differences are recognised in other comprehensive income and accumulated separately in a foreign currency translation reserve, which is a separate component of equity. There are no tax implications on the foreign currency translation reserve as the Corporation is taxed on ZAR functional currency. The foreign currency translation reserve is reclassified from equity to profit and loss when the statement of financial position items is disposed. Appropriateness of using average rates Average rates are considered appropriate since there were no significant fluctuations for the greater part of the financial year. 1.7 Property, equipment and intangible assets 1.7.1 Property and equipment At initial recognition equipment is measured at cost. The cost includes all expenditure that is directly attributable to the acquisition of an asset and to bringing it to a working condition for its intended use. Subsequent to initial recognition equipment is measured at historical cost less accumulated depreciation and impairment losses. Subsequent expenditure relating to equipment that has already been recognised is added to the carrying amount of the asset only when it is probable that future economic benefits associated with the item will flow to the Corporation and the cost of the item can be measured reliably. All other repair and maintenance expenses are recognised in the statement of comprehensive income when incurred.

YOUR EXPORT RISK PARTNER

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