51
Notes to the Consolidated Financial Statements (continued)
For the year ended 31 December, 2012
(Expressed in Thousands of Trinidad and Tobago Dollars, except where otherwise stated)
2. Significant accounting policies
(continued)
(i) Basis of preparation
(continued)
Changes in accounting policy and disclosures
(continued)
The Group has not adopted early the following
new and revised IFRS’s and IFRIC interpretations
that have been issued but are not yet effective:
• IAS 1 Presentation of Items of Other Com-
prehensive Income – Amendments to IAS 1 –
Effective 1 July, 2012
• IAS 19 Employee Benefits (Revised) – Effective
1 January, 2013
• IAS 27 Separate Financial Statements – Effective
1 January, 2013
• IAS 28 Investments in Associates and Joint
Ventures (as revised in 2011) – Effective
1 January, 2013
• IAS 32 Offsetting Financial Assets and Financial
Liabilities – Amendments to IAS 32 – Effective
1 January, 2014
• IFRS 1 Government Loans – Amendments to
IFRS 1 – Effective 1 January, 2013
• IFRS 7 Disclosures – Offsetting Financial Assets
and Financial Liabilities – Amendments to IFRS
7 – Effective 1 January, 2013
• IFRS 9 Financial Instruments: Classification and
Measurement effective 1 January, 2015
• IFRS 10 Consolidated Financial Statements –
Effective 1 January, 2013
• IFRS 11 Joint Arrangements – Effective 1 January,
2013
• IFRS 12 Disclosure of Interests in Other Entities –
Effective 1 January, 2013
• IFRS 13 Fair Value Measurement – Effective
1 January, 2013
• IFRIC 20 Stripping Costs in the Production Phase
of a Surface Mine – Effective 1 January, 2013
• Investment Entities (Amendments to IFRS 10,
IFRS 12 and IAS 27) – Effective 1 January, 2014
The Group is currently assessing the impact of
these new standards on its financial reporting.
Annual Improvements May 2012
Certain limited amendments, which primarily
consist of clarifications to existing guidance,
were made to the following standards and are not
expected to have a material impact on the financial
statements:
• IFRS 1 First–time Adoption of International
Financial Reporting Standards
• IAS 1 Presentation of Financial Statements
• IAS 16 Property Plant and Equipment
• IAS 32 Financial Instruments, Presentation
• IAS 34 Interim Financial Reporting
These improvements are effective for annual
periods beginning on or after 1 January, 2013.
(ii) Going concern
The Group has reported a loss before taxation of
$378.7 million for the year ended 31 December,
2012 ($457.2 million in 2011) and there is $2.05
billion in outstanding debt obligations as presented
on its consolidated statement of financial position
as at 31 December, 2012. Debt service (inclusive of
principal and interest) is forecast to be $293 million
for 2013.
The key risks to the Group’s sustainability are
declining domestic markets and unexpected
increases in key input costs that are not recoverable.
Debt service as a percentage of budgeted Group
EBITDA ranges from 65% in 2013 to 47 % in 2017.
The Group’s operating results in recent years have
been below the budgeted targets given the volatile
market conditions in which the Group operates.
Based on the forecast cash-flows for 2013,
management has performed a sensitivity analysis
under different scenarios. Should the Group
achieve less than 85% of its 2013 forecasted
cash-flows there would be a cash shortfall which
may compromise debt service in 2013. However,
depending on the level of the shortfall management
can manage its capital expenditure and working
capital in the short term to recover certain levels of
the shortfall and therefore not compromise its 2013
debt service obligations.
