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2 Basis of preparation and significant accounting policies

 

2.1 Basis of preparation

These unaudited financial statements are the interim condensed consolidated financial statements of Tecan Group Ltd. and its subsidiaries (together referred to as the ‘Group’) for the six-month period ending June 30, 2017. The financial statements are prepared in accordance with International Accounting Standard (IAS) 34 ‘Interim Financial Reporting’ and should be read in conjunction with the consolidated financial statements 2016 as they provide an update of previously reported information. The interim condensed consolidated financial statements were authorized for issue on August 11, 2017.

 

The preparation of these interim condensed consolidated financial statements requires management to make assumptions and estimates that affect the reported amounts of revenues, expenses, assets, liabilities and disclosure of contingent liabilities at the date of these interim financial statements. If in the future such assumptions and estimates deviate from the actual circumstances, the original assumptions and estimates will be modified as appropriate in the period in which the circumstances change.


The Group operates in industries where significant seasonal or cyclical variations in total sales are not experienced during the financial year. 

 

Income tax expense is recognized based on the best estimate of the weighted average annual income tax rate expected for the full financial year.

 

2.2 Introduction of new and revised/amended accounting standards and interpretations

The accounting policies used in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the consolidated financial statements 2016, except for the adoption of the following new or revised/amended standards and interpretations, effective as from January 1, 2017:

 

Standard/interpretation1

IAS 7 amended ‘Statement of Cash Flows’ – Disclosure Initiative

IAS 12 amended ‘Income taxes’ – Recognition of Deferred Tax Assets on Unrealised Losses

Annual improvements to IFRSs 2014 – 2016 Cycle

  1. IAS = International Accounting Standards, IFRS = International Financial Reporting Standards, IFRIC = Interpretations as by the IFRS Interpretations Committee (formerly International Financial Reporting Interpretations Committee)

The adoption of these new or revised/amended standards and interpretations did not result in substantial changes to the Group’s accounting policies and had no material impact on the financial statements.

 

2.3 New standards and interpretations not yet applied

The following new and revised/amended standards and interpretations have been issued, but are not yet effective and are not applied early in these interim condensed consolidated financial statements:

 

Standard/interpretation1

Effective date 
for the Group

IFRIC 22 ‘Foreign Currency Transactions and Advance Consideration’

Reporting year 2018

IAS 40 amended ‘Investment Properties’ – Transfers of Investment Properties

Reporting year 2018

IFRS 2 amended ‘Share-based Payment’ – Classification and Measurement of

Share-based Payment Transactions

Reporting year 2018

IFRS 9 ‘Financial Instruments’

Reporting year 2018

IFRS 15 ‘Revenue from Contracts with Customers’

Reporting year 2018

IFRIC 23 ‘Uncertainty over Income Tax Treatments’

Reporting year 2019

IFRS 16 ‘Leases’

Reporting year 2019

IFRS 17 ‘Insurance Contracts’

Reporting year 2021

IFRS 10 amended ‘Consolidated Financial Statements, and IAS 28 amended

‘Investments in Associates and Joint Ventures’ – Sale or Contribution of Assets

between an Investor and its Associate or Joint Venture

 To be defined

  1. IAS = International Accounting Standards, IFRS = International Financial Reporting Standards, IFRIC = Interpretations as by the IFRS Interpretations Committee (formerly International Financial Reporting Interpretations Committee)

These changes are not expected to have a significant impact on the consolidated financial statements except for IFRS 15 ‘Revenue from Contracts with Customers’ and IFRS 16 ‘Leases’. For IFRS 16, a comprehensive and detailed analysis is yet to be performed.


The Group assessed the impact of IFRS 15 on the revenue recognition principles that are currently applied. While the Group does not expect changes to the timing of revenue recognition for the majority of its sales due to their nature, the introduction of the standard will limit and reduce the possibility to use the percentage of completion method and therefore may change the timing of the revenue recognition for development services. Further, it will modify the presentation in the balance sheet and increase the disclosures in the notes. The Group continues to analyse the impact.

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