annual report 2009 - Aer Lingus

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52 Financial Statements Aer Lingus Group Plc – Annual Report 2009Notes to the Financial Statements1 General informationAer Lingus Group plc (the “Company”) and its subsidiaries (together the “Group”) operates as an Irish airline primarily providingpassenger and cargo transportation services from Ireland to the UK and Europe (“short haul”) and also to the US (“long haul”).The Company is a public limited liability company incorporated and domiciled in Ireland. The address of its registered office isDublin Airport, Co Dublin, Ireland. The Company has its primary listing on the Irish Stock Exchange and a secondary listing on theLondon Stock Exchange.These financial statements were authorised for issue by the Board of directors on 28 April 2010. The financial statements are for theGroup for the financial years ended 31 December 2009 and 31 December 2008. The principal companies within the Group during theyears ended 31 December 2009 and 31 December 2008 are disclosed in Note 16.2 Summary of significant accounting policiesThe principal accounting policies applied in the preparation of these financial statements are set out below. These policies havebeen consistently applied to all the years presented, unless otherwise stated.2.1 Basis of preparationThe consolidated financial statements of Aer Lingus Group plc, which are presented in euro and rounded to the nearest thousand(€’000) have been prepared in accordance with International Financial Reporting Standards as adopted by the European Union (“IFRS”),International Financial Reporting Interpretations Committee (“IFRIC”) interpretations and the Companies Acts 1963 to 2009 applicableto companies reporting under IFRS. The consolidated financial statements have been prepared under the historical cost convention,as modified by the revaluation of derivative financial instruments and the revaluation of available-for-sale financial assets.The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates and assumptionsthat affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amountsof revenues and expenses during the reporting period. Although these estimates are based on management’s best knowledge of theamount, event or actions, actual results ultimately may differ from those estimated. The areas involving a higher degree of judgementor complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 4.2.1.1 Changes in accounting policy and disclosuresThe following new standards, amendments to existing standards and interpretations are mandatory for the first time for the financialyear beginning 1 January 2009:• IFRIC 13 Customer Loyalty Programmes• IFRIC 16 Hedges of a Net Investment in a Foreign Operation• IFRS 1 and IAS 27 (Amendment) Cost of an Investment in a Subsidiary, Jointly Controlled Entity or Associate• IFRS 2 (Amendment) Vesting Conditions and Cancellations• IFRS 7 (Amendment) Improving Disclosures about Financial Instruments• IFRS 8 Operating Segments• IAS 1 (Revised) Presentation of Financial Statements• IAS 1 and IAS 32 (Amendment) Puttable Financial Instruments and Obligations Arising on Liquidation• IAS 23 (Revised) Borrowing Costs• IFRIC 15 Agreements for the Construction of Real Estate
Financial Statements Aer Lingus Group Plc – Annual Report 2009532 Summary of significant accounting policies [continued]• Improvements to IFRSs (May 2008)– IFRS 5 Non-current Assets Held for Sale and Discontinued Operations– IFRS 7 Financial Instruments: Disclosures– IAS 1 Presentation of Financial Instruments– IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors– IAS 10 Events after the Reporting Period– IAS 16 Property, Plant and Equipment– IAS 18 Revenue– IAS 19 Employee Benefits– IAS 20 Accounting for Government Grants and Disclosures of Government Assistance– IAS 23 Borrowing Costs– IAS 27 Consolidated and Separate Financial Statements– IAS 28 Investment in Associates– IAS 29 Financial Reporting in Hyperinflationary Economies– IAS 31 Interest in Joint Ventures– IAS 34 Interim Financial Reporting– IAS 36 Impairment of Assets– IAS 38 Intangible Assets– IAS 39 Financial Instruments: Recognition and Measurement– IAS 40 Investment Property– IAS 41 AgricultureWhen the adoption of a new standard, an amendment to an existing standard or an interpretation, which is listed above, is deemedto have an impact on the financial statements or performance of the Group, its impact is described below:IFRIC 13 Customer Loyalty ProgrammesThis interpretation requires customer loyalty credits to be accounted for as a separate component of the sales transaction in which theyare granted. A portion of the fair value of the consideration received is allocated to the award credits and deferred. This is then recognisedas revenue in the period in which the award credits are redeemed. The Group maintains a loyalty points programme, the Gold Circle Club,which allows customers to accumulate points when they purchase flights. The points can then be redeemed for free flights, products andservices with Aer Lingus and its partners, subject to a minimum number of points being obtained. The Group has historically recorded aliability at the time of sale based on the costs expected to be incurred to supply free flights, products and services in the future. IFRIC 13has no specific provisions on transition, therefore, the Group has followed IAS 8 Accounting Policies, Changes in Accounting Estimatesand Errors and applied the changes retrospectively. The prior period financial information has therefore been restated.Under the new policy, consideration received is allocated between the flights sold and the points issued, with the consideration allocatedto the points equal to their fair value. Fair value of the points is determined by applying statistical analysis. The fair value of the pointsissued is deferred and recognised as revenue when the points are redeemed.As a result of the adoption of IFRIC 13, the following adjustments were made to the 2008 financial statements:As of 1 January 2008:Increase in deferred tax asset €1,168,000Increase in provisions €9,341,000Decrease in opening retained earnings €8,173,000As of 31 December 2008:Increase in deferred tax asset €1,463,000Increase in provisions €11,703,000Decrease in opening retained earnings €10,240,000For the year ended 31 December 2008:Decrease in revenues €2,362,000Increase in income tax credit €295,000Increase in loss after tax €2,067,000Increase in loss per share0.3 € cent per share
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annual report 2009
Page 3 and 4: Financial HighlightsFor the year en
Page 5 and 6: Chairman’s Statement Aer Lingus G
Page 11 and 12: Operating and Financial Review Aer
Page 13 and 14: Board of Directors Aer Lingus Group
Page 15 and 16: Corporate Social Responsibility Sta
Page 29 and 30: Directors’ Report Aer Lingus Grou
Page 35: Directors’ Report Aer Lingus Grou
Page 38 and 39: 36 Directors’ Report Aer Lingus G
Page 41 and 42: Remuneration Committee Report Aer L
Page 43 and 44: Remuneration Committee Report Aer L
Page 45 and 46: Independent Auditors’ Report Aer
Page 47 and 48: Financial Statements Aer Lingus Gro
Page 53: Financial Statements Aer Lingus Gro
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annual report 2009 - Aer Lingus

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