55 SEPARATE FINANCIAL STATEMENTS 2023 Barbados Public Workers’ Co-operative Credit Union Limited Notes to the Separate Financial Statements March 31, 2023 (expressed in Barbados dollars) 27 2 Accounting policies …continued j) Leases …continued Short-term leases and leases of low-value assets The Credit Union has elected not to recognise right-of-use assets and lease liabilities for leases of lowvalue assets and short-term leases, including leases of IT equipment. The Credit Union recognises the lease payments associated with these leases as an expense on a straight-line basis over the lease term. k) Reimbursable shares Reimbursable shares represent amounts due to the estates of deceased members. l) Deposits Members’ deposits are initially measured at fair value, net of any transaction costs directly attributable to the issuance of the instrument. Members’ deposits are subsequently measured at amortised cost using the effective interest rate method. m) Other liabilities Liabilities for trade creditors and other payables are classified as other financial liabilities and initially measured at fair value net of any transaction costs directly attributable to the issuance of the instrument and subsequently carried at amortised cost using the effective interest rate method. n) Share capital Members’ shares are classified as other financial liabilities under the IAS 32, Financial Instruments: Disclosure and Presentation and are measured at par value. Dividends are paid on an annual basis at rates that are determined at the Annual General meeting of members. Dividends are calculated based on the monthly minimum share balance of each active member of the Credit Union and distributed via credits to members’ deposits. o) Recognition of income and expenses Revenue is recognised on an accrual basis to the extent that it is probable that the economic benefits will flow to the Credit Union and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue and expense are recognised: Interest income and expense Effective interest rate Interest income and expense are recognised in profit or loss using the effective interest rate method. The ‘effective interest rate’ is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial instrument to: - the gross carrying amount of the financial asset; or - the amortised cost of the financial liability.
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