Foreign currencies Monetary assets and liabilities in foreign currencies are translated into Sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into Sterling at the rate of exchange ruling at the date of the transaction. Exchange differences are taken into account in arriving at the operating profit. Exceptional items The Group classifies certain one-off charges or credits that are unusual or have a material impact on the Group’s financial results as ‘exceptional items’. Exceptional items as costs incurred by the Group include gains and losses on disposal of significant assets, integration and reorganisation, non-recurring business restructuring, capital restructuring and mergers and acquisition activity related costs. These are disclosed separately to provide further understanding of the financial performance of the Group. Related party disclosures The Group discloses transactions with related parties which are not wholly owned within the same Group. Where appropriate, transactions of a similar nature are aggregated unless, in the opinion of the Directors, separate disclosure is necessary to understand the effect of the transactions on the Group financial statements. Grants Grants are included within accruals in the balance sheet and credited to the profit and loss account over the expected useful lives of the assets to which they relate or in periods in which the related costs are incurred. Share based payments The company operates a growth share incentive arrangement under which employees selected by the Remuneration Committee of the company are issued Ordinary Shares. Share capital Ordinary shares are classified as equity. Own shares Own shares consist of treasury shares and are recognised at cost as a deduction from shareholders’ equity. Subsequent consideration received for the sale of such shares is also recognised in equity, with any difference between the sale proceeds from the original cost being taken to retained earnings. No gain or loss is recognised in the performance statements on transactions in treasury shares. Priority dividend Future potential dividend payments to A ordinary shareholders have been recorded at fair value based on the probability of dividend payments becoming due in the future. The fair value is based on the probability of a liquidity event occurring at various future dates and a weighted average dividend payment thereafter calculated, discounted to present value using a cost of capital. The probability attached to the timing of a liquidity event and the ensuing change to the fair value of the dividend payments will be reassessed each year, with an ensuing adjustment to the fair value. Classification of Compound Financial Instrument When financial instruments are issued, any component that creates a financial liability of the company is presented as a liability in the Statement of Financial Position, measured initially at fair value net of transaction costs and thereafter at amortised cost until extinguished on conversion or redemption. The corresponding dividends relating to the liability component are charged as interest expense in the income statement. The initial fair value of the liability component is determined using a market rate for an equivalent liability without a conversion feature. The remainder of the proceeds on issue is allocated to the equity component and included in shareholders’ equity, net of transaction costs. The carrying amount of the equity component is not re-measured in subsequent years. Transaction costs are apportioned between the liability and equity components of the shares based on the allocation of proceeds to the liability and equity components when the instruments are first recognised.
Whistl Annual Report 2022
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