Annual Report and Consolidated Account
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2.14 DEFERRED TAXES
Deferred taxes are recognised overall, using the liabili-
ty method and calculated based on the temporary dif-
ferences arising from the difference between the tax-
able base of assets and liabilities and their values in
the consolidated financial statements. However, if the
deferred cost arises from the initial recognition of an
asset or liability in a transaction that is not a corporate
concentration or that, on the transaction date, does
not affect the accounting result or the tax result, this
amount is not accounted. Deferred taxes are deter-
mined by the tax (and legal) rates decreed or substan-
tially decreed on the date of the consolidated state-
ment of financial position and that can be expected to
be applicable in the period of the deferred tax asset or
in the liquidation of the deferred tax liability.
Deferred tax assets are recognised insofar as it will be
probable that future taxable income will be available
for using the respective temporary difference.
2.15 PROVISIONS
Provisions for costs of restructuring activities, paid
contracts and legal claims are recognised when the
group has a legal or constructive obligation due to
past events and when it is probable that a outflow of
resources will be necessary to liquidate the obliga-
tion, and when the obligation amount may be reliably
estimated. Provisions for restructuring operations in-
clude penalties for terminating leasing contracts and
indemnity payments for terminating employee work
contracts. Provisions are not recognised for future op-
erating losses.
When there are a similar number of obligations, the
probability of generating an outflow is determined by
combining these obligations.
2.16 RECOGNISING REVENUE
Revenue comprises the fair value of the sale of goods
and rendering of services, net of taxes and discounts
and after eliminating internal sales. Revenue is recog-
nised as follows:
a) Sale of goods - retail
The sale of goods is recognised when the product is
sold to the customer. Retail sales are normally made
in cash or through debit/credit cards. The revenue
to be recognised is the gross sale amount, including
debit/credit card transaction fees. Sales of goods to
customers, associated to events or congresses, are
recognised when they occur.
b) Rendering of services
Rendering of services is recognised in the accounting
period in which the services are rendered, in reference
to the transaction end date on the consolidated state-
ment of financial position date.
c) Interest
Interest is recognised taking into account the pro-
portion of the time elapsed and the asset’s effective
income. When an account receivable is under impair-
ment, the group reduces its accounting value to the
recoverable value, which is equal to the current value
of estimated future cash flows discounted at the as-
set’s original effective interest rate. The discount re-
mains recognised as financial income.
