Page 72 - Beeks Financial Cloud Group Annual Report 2021

70 Beeks Financial Cloud Group PLC For the year ended 30 June 2021

Notes to the Consolidated Financial Statements

Notes to

Financial Statements

Leases lease term. The Group assesses the made and increased for interest.
A lease is defined as a contract, right-of-use asset for impairment It is re-measured to reflect any
or part of a contract, that conveys under IAS 36 ‘Impairment of Assets’ reassessment or modification,
the right to use of an asset (the where such indicators exist. or if there are changes in fixed
underlying asset) for a period of payments. When the lease liability
time in exchange for consideration. Lease liabilities are presented on is re-measured, the corresponding
To apply this definition The Group two separate lines in the balance adjustment is reflected in the
assesses whether the contract sheet for amounts due within one right-of-use asset, or profit and loss
meets three key evaluations which year and amounts due after more if the right-of-use asset is already
are whether the contract contains than one year. The lease liability is reduced to zero.
an identified asset, which is either initially measured at the present
explicitly identified in the contract value of lease payments that are The Group has elected to account
or implicitly specified by being not paid at the commencement for short-term leases and leases of
identified at the time the asset date, discounted using the rate low-value assets using the practical
is made available to The Group; implicit in the lease. If this rate expedients available under IFRS 16.
The Group has the right to obtain cannot readily be determined, Instead of recognising a right-of-use
substantially all of the economic The Group applies an incremental asset and lease liability, the payments
FINANCE
benefits from use of the identified borrowing rate. The lease liability in relation to these are recognised
asset throughout the period of is subsequently measured by as an expense in profit or loss on a
use, considering its rights within increasing the carrying amount to straight line basis over the lease term.
the defined scope of the contract; reflect interest on the lease liability
and The Group has the right to and by reducing the liability by Under IFRS 16, The Group
direct the use of the identified asset payments made. The Group re- recognises depreciation of the
throughout the period of use. measures the lease liability (and right-of-use asset and interest on
adjusts the related right-of-use lease liabilities in the consolidated
At the lease commencement date, asset) whenever the lease term statement of comprehensive
The Group recognises a right-of-use has changed or a lease contract is income over the period of the
asset and a corresponding lease modified and the modification is not lease. On the balance sheet, right-
liability on the balance sheet. The accounted for as a separate lease. of-use assets have been included
right-of-use asset is measured at in leasehold property and
cost, which is made up of the initial Lease payments included in the improvement and lease liabilities
measurement of the lease liability measurement of the lease liability have been included in lease
measured at the present value of can be made up of fixed payments liabilities due within one year and
future lease payments, any initial and an element of variable charges after more than one year.
direct costs incurred by The depending on the estimated
Group The Group depreciates future price increases, whether INTANGIBLE ASSETS AND
the right-of-use assets on a these are contractual or based AMORTISATION
straight-line basis from the lease on management’s estimate of Goodwill
commencement date to the earlier potential increases. Subsequent Goodwill represents the excess of the
of the end of the useful life of the to initial measurement, the liability cost of an acquisition over the fair
right-of-use asset or the end of the will be reduced for payments value of the assets and