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4.8Revenue and expense recognition
Revenue and expenses are recognised on an accrual basis, i.e. when the actual flow of the related
goods and services occurs, regardless of when the resulting monetary or financial flow arises.
Revenue ismeasured at the fair value of the consideration received, net of discounts and taxes.
Revenue from sales is recognised when the significant risks and rewards of ownership of the goods
sold have been transferred to the buyer, and the Company retains neither continuing managerial
involvement to the degree usually associated with ownership nor effective control over the goods
sold.
Revenue from the rendering of services is recognised by reference to the stage of completion of
the transaction at the end of the reporting period, provided the outcome of the transaction can be
estimated reliably.
At present, the Company basically obtains revenue from the sale of advertising space; this
revenue is recognised in the income statement when the related advertising spot is broadcast.
Interest income from financial assets is recognised using the effective interest method and
dividend income is recognised when the shareholder's right to receive payment has been
established. Interest and dividends from financial assets accrued after the date of acquisition are
recognised as income.
4.9Provisions and contingencies
When preparing the financial statements the Company's directorsmade a distinction between:
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Provisions: credit balances covering present obligations arising from past events with
respect to which it is probable that an outflow of resources embodying economic benefits that is
uncertain as to its amount and/or timingwill be required to settle the obligations; and
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Contingent liabilities: possible obligations that arise from past events and whose existence
will be confirmed only by the occurrence or non-occurrence of one or more future events not
whollywithin the Company's control.
The financial statements include all the provisions with respect to which it is considered that it is
more likely than not that the obligation will have to be settled. Contingent liabilities are not
recognised in the financial statements, but rather are disclosed, unless the possibility of an outflow
in settlement is considered to be remote.
Provisions aremeasured at the present value of the best possible estimate of the amount required
to settle or transfer the obligation, taking into account the information available on the event and
its consequences. Where discounting is used, adjustments made to provisions are recognised as
interest cost on an accrual basis.
The compensation to be received from a third party on settlement of the obligation is recognised
as an asset, provided that there are no doubts that the reimbursement will take place, unless
there is a legal relationship whereby a portion of the risk has been externalised as a result of
which the Company is not liable; in this situation, the compensation will be taken into account for
the purpose of estimating the amount of the related provision that should be recognised.
4.10 Terminationbenefits
Under current legislation, the Company is required to pay termination benefits to employees
terminated under certain conditions. Therefore, termination benefits that can be reasonably
quantified are recognised as an expense in the year in which the decision to terminate the
employment relationship is taken. The accompanying financial statements do not include any
provision in this connection, since no situations of this nature are expected to arise.
