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Notes to the Consolidated Financial Statements

31st March 2015

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

2.16 Share capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of
new shares and share options are shown in equity as a deduction, net of tax, from the proceeds.
Where any group company purchases the Company’s equity share capital (treasury shares), the
consideration paid, including any directly attributable incremental costs (net of income taxes) is
deducted from equity attributable to owners of the Company until the shares are cancelled or
reissued. Where such ordinary shares are subsequently reissued, any consideration received, net
of any directly attributable incremental transaction costs and the related income tax effects, is
included in equity attributable to owners of the Company.

2.17 Trade and other payables

Trade payables are obligations to pay for goods or services that have been acquired in the ordinary
course of business from suppliers. Trade payables are classified as current liabilities if payment is
due within one year or less (or in the normal operating cycle of the business if longer). If not, they
are presented as non-current liabilities.

Trade and other payables are recognised initially at fair value and subsequently measured at
amortised cost using the effective interest method.

2.18 Borrowings

Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are
subsequently stated at amortised cost; any difference between the proceeds (net of transaction
costs) and the redemption value is recognised in the consolidated income statement over the
period of the borrowings using the effective interest method.

Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to
the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee
is deferred until the draw-down occurs. To the extent there is no evidence that it is probable that
some or all of the facility will be drawn down, the fee is capitalised as a pre-payment for liquidity
services and amortised over the period of the facility to which it relates.

Borrowings are classified as current liabilities unless the Group has an unconditional right to defer
settlement of the liability for at least 12 months after the end of the reporting period.

48 ALCO HOLDINGS LIMITED ANNUAL REPORT 2015