REA Group Ltd Annual Report 2021

Annual Report 2021 | REA Group Ltd 26. Other significant accounting policies Accounting policies Foreign currency translation The consolidated Financial Statements are presented in Australian dollars, which is the Group’s presentation currency . Items included in the Financial Statements of each of the Group’s entities are measured using the currency of the primary economic environments in which the entity operates (“the functional currency”). Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Income Statement. They are deferred in equity if they relate to qualifying cash flow hedges and qualifying net investment hedges or are attributable to part of the net investment in a foreign operation. All foreign exchange gains and losses are presented in the Income Statement on a net basis within operations and administration expenses. Translation differences on assets and liabilities carried at fair value are reported as part of the fair value gain or loss. Translation differences on non-monetary assets and liabilities such as equities held at fair value through profit or loss are recognised in the Income Statement as part of the fair value gain or loss. Translation differences on non-monetary assets are included in the fair value reserve in equity. The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows, with all resulting exchange differences are recognised in OCI: – Assets and liabilities for each Statement of Financial Position presented are translated at the closing rate at the date of that Statement of Financial Position; and – Income and expenses for each Income Statement are translated at average exchange rates (unless this is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the dates of the transactions). Goodwill and fair value adjustments arising on the acquisition of a foreign operation are treated as assets and liabilities of the foreign operation and translated at the closing rate. New and amended Accounting Standards and Interpretations New standards effective from 1 July 2021: The Group has not adopted any new or amended Accounting Standards or Interpretations this year that have had a material impact on the Group. New standards and interpretations not yet adopted: There are a number of new accounting standards, amendments and interpretations that have been issued but are not yet effective, however these are not considered relevant to the activities of the Group nor are they expected to have a material impact on the financial statements of the Group. Year in review Directors’ Report Financial Statements Remuneration Report Sustainability Our Leaders 123