Page 34 - Annual Report KELAG Group 2018
P. 34

Trade payables and other liabilities are measured at amortised cost.

           Current  other  liabilities  contain  energy  derivatives.  The  derivative  financial  instruments  are
           recognised at fair value. The carrying amount of derivatives with a netting agreement are offset
           and thus shown as net figures in the statement of financial position.

           Contingent liabilities  are  possible  obligations to  third parties  or  existing  obligations  that  will
           probably not lead to an outflow of resources or whose amount cannot be reliably measured.
           Contingent  liabilities  are  recognised  in  the  statement  of  financial  position  only  if  they  were
           assumed  as  part  of  a  business  combination.  They  are  recognised  at  fair  value  and  then
           subsequently measured at the higher of:

               the amount that would be recognised in accordance with the guidance for provisions above
                (IAS 37); or
               the amount initially recognised less, when appropriate, cumulative amortisation recognised in
                accordance with the guidance for revenue recognition.

           Government grants are recognised at fair value where there is reasonable assurance that the grant
           will be received and all attached conditions will be complied with. When the grant relates to an
           expense item, it is recognised as income over the period necessary to match the grant on  a
           systematic basis to the costs that it is intended to compensate.

           Public investment subsidies are offset against the corresponding cost.

           The construction cost subsidies recognised in the statement of financial position are mainly those
           received from customers for the grid business and connection costs to the electricity and gas grid
           as well as other connection cost contributions from the heat segment, which are classified as
           contract liabilities pursuant to IFRS 15. These are reported as a liability and released through profit
           or loss. The amounts released are reported in revenue.

           If grid user charges are set by a regulator on the basis of cost or earnings estimates and lower or
           higher costs or earnings in the past are considered during the future rate setting procedure, the
           grid operator is entitled to raise its charges to recover additional costs or lower earnings from the
           grid users by raising its charges and is required to reduce its charges to reimburse users for lower
           costs  or  earnings  increases  by  setting  lower  user  charges  in  future  years.  Such  claims  or
           obligations are referred to as regulatory assets or liabilities.

           In the grid business, the KELAG Group is subject to a regulated tariff regime; E-Control Austria (the
           government regulator for electricity and natural gas markets) acts as the regulatory authority in
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