Republic Bank Limited
76
For the year ended September 30, 2015. Expressed in thousands of Trinidad and Tobago dollars ($’000) except where otherwise stated
Notes to theConsolidatedFinancial Statements
4
Financial
2 SIGNIFICANT ACCOUNTING POLICIES
(continued)
2.2 Basis of consolidation
(continued)
Subsidiaries are all entities over which the Group has the power to direct the relevant activities, have exposure or rights to the
variable returns and the ability to use the power to affect the returns of the investee, generally accompanying a shareholding of
more than 50% of the voting rights.
When the Group has less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and
circumstances in assessing whether it has power over an investee, including:
• The contractual arrangement with the other vote holders of the investee
• Rights arising from other contractual arrangements
• The Group’s voting rights and potential voting rights
The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or
more of the three elements of control.
Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from
the date that control ceases and any resultant gain or loss is recognised in the statement of income. Any investment retained is
recognised at fair value.
A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction.
2.3 Changes in accounting policies
New accounting policies/improvements adopted
The accounting policies adopted in the preparation of the consolidated financial statements are consistent with those followed
in the preparation of the Group’s annual financial statements for the year ended September 30, 2014 except for the adoption of
new standards and interpretations noted below:
IFRS 10, IFRS 12 and IAS 27 – Investment Entities (Amendments) (effective January 1, 2014)
The amendments apply to investments in subsidiaries, joint ventures and associates held by a reporting entity that meet the
definition of an investment entity. The concept of an investment entity is new to IFRS. The amendments represent a significant
change for investment entities, which are currently required to consolidate investees that they control. Significant judgement of
facts and circumstances may be required to assess whether an entity meets the definition of investment entity. The adoption and
amendments to these standards had no impact on the financial position or performance of the Group.
IAS 19 – Defined Benefit Plans: Employee Contributions – Amendments to IAS 19 (effective July 1, 2014)
IAS 19 requires an entity to consider contributions from employees or third parties when accounting for defined benefit plans.
IAS 19 requires such contributions that are linked to service to be attributed to periods of service as a negative benefit.
The amendments clarify that, if the amount of the contributions is independent of the number of years of service, an entity is
permitted to recognise such contributions as a reduction in the service cost in the period in which the service is rendered, instead
of allocating the contributions to the periods of service. Examples of such contributions include those that are a fixed percentage
of the employee’s salary, a fixed amount of contributions throughout the service period, or contributions that depend on the
employee’s age.
