MIDDLESEX UNIVERSITY – NOTES TO THE ACCOUNTS (continued)
Year ended 31 July 2021
charge is allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Operating leases
Costs in respect of operating leases are charged on a straight-line basis over the lease term. Any lease premiums or incentives are spread over the minimum lease term.
Service concession arrangements
Fixed assets held under service concession arrangements are recognised on the statement of financial position at the present value of the minimum lease payments when the assets are brought into use with a corresponding financial liability.
Payments under the service concession arrangement are allocated between service costs, finance charges and financial liability repayments to reduce the financial liability to nil over the life of the arrangement.
J Foreign Currencies
Transactions in foreign currencies are translated to the respective functional currencies of Group entities at the rate of exchange on the transaction date.
Monetary assets and liabilities denominated in foreign currencies at the statement of financial position date are translated to the functional currency at the exchange rate prevailing at that date.
Non-monetary assets and liabilities that are measured at historical cost in a foreign currency are translated using the exchange rate at the date of the transaction. Non-monetary assets and liabilities denominated in foreign currencies that are stated at fair value are retranslated to the functional currency at the exchange rates prevailing at the dates the fair value was determined.
Foreign exchange differences arising on translation are recognised in the consolidated statement of comprehensive income surplus or deficit (except for differences arising on the retranslation of a financial liability designated as a hedge of the net investment in a foreign operation that is effective, or qualifying cash flow hedges, which are recognised directly in other comprehensive income).
The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on consolidation, are translated to the Group’s presentational currency, Sterling, at exchange rates ruling at the statement of financial position date. The revenues and expenses of foreign operations
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are translated at an average rate for the year where this rate approximates to the exchange rates ruling at the dates of the transactions. Exchange differences arising from this translation of foreign operations are reported as an item of other comprehensive income.
When the Group disposes of only part of its interest in a subsidiary that includes a foreign operation while still retaining control, the relevant proportion of the accumulated amount is reattributed to non-controlling interests. When the Group disposes of only part of its investment in an associate or joint venture that includes a foreign operation while still retaining significant influence or joint control, the relevant proportion of the cumulative amount is recycled to the consolidated statement of comprehensive income.
Exchange differences arising from a monetary item receivable from or payable to a foreign operation, the settlement of which is neither planned nor likely in the foreseeable future, are considered to form part of a net investment in a foreign operation and are recognised directly in equity.
K Tangible Fixed Assets Valuation
Fixed assets are stated at cost/deemed cost less accumulated depreciation and accumulated impairment losses. Certain items of land and buildings fixed assets that have been revalued on the date of transition to FRS 102 are measured on the basis of deemed cost, being the revalued amount at the date of the revaluation 31 July 2014.
Where parts of a fixed asset have different useful lives, they are accounted for as separate items of fixed assets.
Land and buildings Capitalisation
Costs incurred in relation to land and buildings after initial purchase or construction are capitalised to the extent that they increase the expected future benefits to the University.
Depreciation
Freehold land is not depreciated as it is considered to have an indefinite useful life. Freehold buildings are depreciated on a straight line basis over their expected useful lives as follows:
Freehold Buildings Freehold Buildings Major Improvements Minor Refurbishments
50 years 50 years
10 – 20 years
Middlesex University
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