Page 55 - RFU Annual Report 2017

53
Financial Statements

2. Accounting policies continued travel revenue is recognised on the The income tax charge for the year
commencement of the related tour, is calculated on the basis of tax rates
(e) Revenue being the date of travel; and laws that have been enacted or
Revenue represents amounts invoiced, substantively enacted by the Balance
excluding value added tax, in respect hotel revenue is recognised at the Sheet date, in the countries where the
of the sale of goods and services point at which rooms are occupied Company and the Group operate and
rendered. Revenue recognition policies and food and beverage is sold; generate income.
for specific revenue streams are as
follows: health club revenue is recognised Deferred tax balances are recognised
on a straight-line basis over the in respect of all timing differences that
ticket revenue and the sale of membership term with joining fees have originated but not reversed by the
hospitality packages are recognised recognised at the point membership Balance Sheet date, except that:
as revenue when the related event is commences;
staged; the recognition of deferred tax assets
fees from the staging of concerts and is limited to the extent that it is
revenue determined by commercial after match events at Twickenham probable that they will be recovered
contracts, which makes up the Stadium are recognised at the date of against the reversal of deferred tax
majority of broadcasting revenue, the event; liabilities or other future taxable
sponsorship revenue and the leasing profits;
of hospitality boxes, is recognised in revenue from barter transactions for
accordance with the terms and period advertising is recognised at fair value where they relate to timing
of the contract; when the service is performed; differences in respect of interests in
subsidiaries, associates, branches
sponsorship income is shown catering income is recognised as at and joint ventures and the Group
gross of revenue received in kind the date of the event. can control the reversal of the
whereby sponsors provide services timing differences and such reversal
and merchandise in return for (f) Operating leases is not considered probable in the
sponsorship benefits, valued based Rentals payable under operating leases foreseeable future.
on the goods and services received. are charged on a straight-line basis
The related costs are also shown over the term of the lease. Deferred tax balances are not
gross to reflect the value of such recognised in respect of permanent
services and merchandise; (g) Taxation and deferred taxation differences except in respect of
The tax charge for the year comprises business combinations, when deferred
subscription income relating to the current and deferred tax. Tax is tax is recognised on the differences
England Rugby Club is recognised recognised in the Profit and Loss between the fair values of assets
on a straight-line basis over the Account, except where an item acquired and the future tax deductions
period to which the subscription of income or expense has been available for them and the differences
relates; recognised in other comprehensive between the fair values of liabilities
income or directly in equity. In such a acquired and the amount that will
grant income is recognised when situation the tax charge or credit is also be assessed for tax. Deferred tax is
the respective grant conditions have recognised in other comprehensive determined using tax rates and laws
been satisfied and over the period to income or directly in equity. that have been enacted or substantively
which the grant relates; enacted by the Balance Sheet date.

Annual Report 2017