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Accounting Policies





for the period ended 31 December 2015

amount does not exceed the carrying amount that would have

been determined, net of depreciation or amortisation, if no

impairment loss had been recognised.

1.12 Stated Capital and Reserves

Stated capital


attributable to the issue of ordinary shares are recognised as a

deduction fromequity, net of any taxation effects.

Foreign currency translation reserve

Gains and losses arising on translation of the assets, liabilities,

income and expenses of foreign operations are recognised

directly in equity as a foreign currency translation reserve.

Cash flow hedge reserve

Anon-distributable reserve arises as a result of the application

of hedge accounting gains or losses on interest rate swaps.

1.13 Dividends

Dividends and the related withholdings tax are accounted

for in the period when the dividend is declared. Dividends

declared on equity instruments after the reporting date, and

the related withholding taxation thereon, are accordingly

not recognised as liabilities at the reporting date.

1.14 Interest earned

Revenue comprises interest income. Interest is recognised

on a time-proportion basis taking account of the principal

outstanding and the effective interest rate over the period

to maturity, when it is probable that such income will accrue

to the RCS Group.

1.15 Interest expense

Interest expense comprises interest which has been incurred

on borrowings. All borrowing costs are recognised in the

income statement.

1.16 Other income

Club income

Club income is recognised in the income statement when due.

Collection income

Collection income is recognised in the income statement

when due.

Net insurance premiums

Insurance premiums are recognised, net of claims, in the

income statement when due.

Merchant commission income

Merchant commission income is recognised when the related

transaction on which the commission is earned has been


Service and initiation fee income

Service and initiation fee income are recognised in the income

statement when due.

1.17 Operating lease

Leases where the lessor retains the risks and rewards of

ownership of the underlying asset are classified as operating

leases. Paymentsmade under operating leases are recognised

in the income statement on a straight-line basis over the term

of the lease.

1.18 Taxation

Income taxation expense comprises current and deferred


Income taxation expense is recognised in the income

statement except to the extent that it relates to a transaction

that is recogniseddirectly inother comprehensive incomeor in

equity, in which case it is recognised in other comprehensive

income or equity as appropriate.