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2.6.2 Recognition and measurement
Loans and receivables are initially recognised at fair value and are subsequently measured at amortised cost using the
effective interest rate method. They are derecognised only when the contractual rights to the cash flows from the
financial asset expire or the Company transfers substantially all risks and rewards of ownership.
2.6.3 Impairment
The Company assesses at each balance sheet date whether there is objective evidence that a financial asset or a group
of financial assets is impaired.
A provision for impairment of trade receivables is established when there is objective evidence that the Company will
not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties
of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in
payments are considered indicators that the trade receivable is impaired. The amount of the provision is the difference
between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the original
effective interest rate. The carrying amount of the asset is reduced through the use of an allowance account, and the
amount of the loss is recognised in the income statement under provision for impairment. When a trade receivable is
uncollectible, it is written off against the allowance account for trade receivables. Subsequent recoveries of amounts
previously written off are credited in the income statement.
2.7 Inventories
Inventories are stated at the lower of cost and net realisable value. Cost is determined using the weighted average
method. Net realisable value is the estimated selling price in the ordinary course of business, less applicable variable
selling expenses. Costs of inventories include the transfer from equity of any gains/(losses) on qualifying cash flow
hedges purchases of raw materials.
2.8 Trade receivables
Trade receivables are amounts due from customers for aeronautical and other services performed in the ordinary course
of business. If collection is expected in one year or less, they are classified as current assets. If not, they are presented as
non-current assets.
2.9 Cash and cash equivalents
Cash and cash equivalents includes cash in hand, deposits held at call with banks, other short-term highly liquid
investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within
borrowings in current liabilities on the balance sheet.
2.10 Share capital
Ordinary shares are classified as equity. Incremental costs associated directly with the issue of new ordinary shares are
shown in equity as a reduction, net of tax, from the proceeds.
2.11 Trade payables
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business
from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they
are presented as non-current liabilities. Trade payables are recognised initially at fair value and subsequently measured
at amortised cost using the effective interest method.
2.12 Borrowings
Borrowings are initially recognised at fair value, net of transaction costs. Borrowings are subsequently stated at amortised
cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognised in the
income statement over the period of the borrowings using the effective interest method.
Borrowing costs that relate to assets that need a substantial period of time to get ready for use are capitalised.
Borrowings are classified as current liabilities unless the Company has an unconditional right to defer settlement of the
liability for at least 12 months after the balance sheet date.
Financial Statements as at 31 December 2011 (Amounts in Euros unless otherwise stated) Page 22 of 50
2.6.2 Recognition and measurement
Loans and receivables are initially recognised at fair value and are subsequently measured at amortised cost using the
effective interest rate method. They are derecognised only when the contractual rights to the cash flows from the
financial asset expire or the Company transfers substantially all risks and rewards of ownership.
2.6.3 Impairment
The Company assesses at each balance sheet date whether there is objective evidence that a financial asset or a group
of financial assets is impaired.
A provision for impairment of trade receivables is established when there is objective evidence that the Company will
not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties
of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in
payments are considered indicators that the trade receivable is impaired. The amount of the provision is the difference
between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the original
effective interest rate. The carrying amount of the asset is reduced through the use of an allowance account, and the
amount of the loss is recognised in the income statement under provision for impairment. When a trade receivable is
uncollectible, it is written off against the allowance account for trade receivables. Subsequent recoveries of amounts
previously written off are credited in the income statement.
2.7 Inventories
Inventories are stated at the lower of cost and net realisable value. Cost is determined using the weighted average
method. Net realisable value is the estimated selling price in the ordinary course of business, less applicable variable
selling expenses. Costs of inventories include the transfer from equity of any gains/(losses) on qualifying cash flow
hedges purchases of raw materials.
2.8 Trade receivables
Trade receivables are amounts due from customers for aeronautical and other services performed in the ordinary course
of business. If collection is expected in one year or less, they are classified as current assets. If not, they are presented as
non-current assets.
2.9 Cash and cash equivalents
Cash and cash equivalents includes cash in hand, deposits held at call with banks, other short-term highly liquid
investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within
borrowings in current liabilities on the balance sheet.
2.10 Share capital
Ordinary shares are classified as equity. Incremental costs associated directly with the issue of new ordinary shares are
shown in equity as a reduction, net of tax, from the proceeds.
2.11 Trade payables
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business
from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they
are presented as non-current liabilities. Trade payables are recognised initially at fair value and subsequently measured
at amortised cost using the effective interest method.
2.12 Borrowings
Borrowings are initially recognised at fair value, net of transaction costs. Borrowings are subsequently stated at amortised
cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognised in the
income statement over the period of the borrowings using the effective interest method.
Borrowing costs that relate to assets that need a substantial period of time to get ready for use are capitalised.
Borrowings are classified as current liabilities unless the Company has an unconditional right to defer settlement of the
liability for at least 12 months after the balance sheet date.
Financial Statements as at 31 December 2011 (Amounts in Euros unless otherwise stated) Page 22 of 50
