Page 23 - Annual Report KELAG Group 2018
P. 23

The  KELAG  Group  will  apply  the  modified  retrospective  method  specified  in  the  transitional
                                      provisions  for  first-time  application  for  IFRS  16,  by  not  adjusting  the  prior-year  figures.
                                      Furthermore,  the  following  practical  expedients  or  options  in  connection  with  the  first-time
                                      application will mainly be exercised:

                                          The KELAG Group will not reassess whether or not a contract constitutes a lease as defined by
                                          IFRS 16 if this was already present at the time of first-time application. Accordingly, the definition
                                          of a lease pursuant to IAS 17 and IFRIC 4 will continue to apply for the leases in place before
                                          1 January 2019.
                                          The KELAG Group will use a single discount rate for portfolios of similar leases. Specifically, a
                                          country-specific  risk  premium  is  considered  in  discount  rates  linked  to  maturities,  which  is
                                          consistent with the respective discount rates under the impairment calculations pursuant to
                                          IAS 36.
                                          The KELAG Group will treat leases with a remaining lease term not exceeding 12 months as short-
                                          term leases.
                                          The  KELAG  Group  will  use  onerous  contracts  provision  assessments  instead  of  impairment
                                          testing pursuant to IAS 36.
                                          The KELAG Group will recognise the right-of-use asset in the amount of the lease liability.

                                      IFRIC 23 is mandatory for financial years beginning on or after 1 January 2019 and addresses the
                                      accounting for income taxes when tax treatments involve uncertainty that affects the application
                                      of IAS 12. For instance, this relates to uncertainties with respect to the (non-)acceptance of tax
                                      treatments of certain items in tax declarations. The effects of this interpretation on the KELAG
                                      Group  still  have  to  be  reviewed  in  detail; however,  only  immaterial  changes  are  expected  at
                                      present.
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