Page 45 - CODIC 2016/2017 - Annual report

specific contract, including borrowing costs (see note 3.10*), charges attributable to the activity of the contracts
in general and that can reasonably be attributed to the contract, as well as other similar charges that can be
specifically invoiced to the client in accordance with the terms of the contract. If it appears that total contract
costs will exceed total contract revenue, the expected losses are recognised immediately as an expense.

The IFRS 15 standard will replace the IAS 18 standard relating to the recognition of revenue from the sale of
goods and services and the IAS 11 standard relating to the recognition of income from construction contracts.
The entry into force of this standard in 2018/2019 will result in changes to the recognition of revenue generated
by contracts with customers.
An in-depth analysis of ongoing contracts is required in order to determine the impact of this new model; no
quantified estimate will be presented at this stage.

Revenue also includes any price complements received in consideration of commercial services provided by
the Group, which consist of arranging leases of the properties sold.
Recognition of associated revenue coincides with the signing of the leases that give rise to the price complements.
These are contractually determined based on the areas leased out, the duration of the lease and the amount
of the rentals.
As for unsold properties, since looking for tenants is not covered by a sales agreement at the time the services
are rendered, this service is not specifically re-invoiced to the buyer on entering into a sales agreement. However,
it greatly influences the setting of the price, since the latter depends largely on the level of occupancy of the
property sold.

13. INCOME TAXES
The tax expense for the period comprises current and deferred tax. Tax is recognised in the income statement,
except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity
as well.
Current income tax is the amount of tax payable on the basis of the taxable profit for the year, plus any corrections
relating to previous years. It is calculated on the basis of the local tax rates applicable at closing.

Deferred tax comprises on the one hand tax payable in future years in respect of taxable temporary differences,
and on the other hand tax recoverable in future years in respect of deductible temporary differences, unused
recoverable tax losses carried forward and tax credits. Temporary differences are the differences between the
net carrying amount of the assets and liabilities in the financial statements and their corresponding tax base.

Deferred tax liabilities are recognised on all taxable temporary differences, whereas deferred tax assets are
recognised only to the extent that it is probable that future taxable profit will be available against which the
temporary differences can be utilised.

At each closing the Group re-estimates the amount of deferred tax assets in light of the expected taxable
results of the entities concerned.

14. EMPLOYEE BENEFITS
Short-term benefits are recognised in the period during which they are incurred.
Post-employment benefits consist of pensions and other retirement benefits, as well as life insurance and
post-employment medical care. These benefits are granted exclusively under defined contribution plans, the
contributions being expensed as and when due.

* The notes to the consolidated financial statements are available on www.codic.eu or from the head office upon request.

Codic Annual Report 2016/2017 43