Icon Energy Annual Report 2019

Notes to the Consolidated Financial Statements for the year ended 30 June 2019 ICON ENERGY LIMITED AND ITS CONTROLLED ENTITIES FOR THE YEAR ENDED 30 JUNE 2019 NOTE 24 - STATEMENT OF ACCOUNTING POLICIES (a) Application date of standard Application start date for the Group Annual periods beginning on or after 1 January 2019 1 July 2019 Certain new accounting standards and interpretations have been published that are not mandatory for 30 June 2019 reporting periods. Some of them are available for early adoption at 30 June 2019, but have not been applied in preparing this financial report. The Consolidated Entity's assessment of the impact of these new standards and interpretations is set out below: Reference The nature and effects of the key changes to the Group’s accounting policies resulting from its adoption of AASB 9 are summarised below. The change in accounting policy has not had a significant impact on the Group’s financial results. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Impact on Group financial report Standards and Interpretations issued but not yet adopted AASB 16 - Leases AASB 16 introduces a single, on-balance sheet lease accounting model for lessees. A lessee recognises a right-of-use asset representing its right to use the underlying asset and a lease liability representing its obligation to make lease payments. There are recognition exemptions for short-term leases and leases of low-value items. There is a current operating lease in place that the Group is a party to as a result of its sale and leaseback arrangement. Based on the entity’s preliminary assessment, the likely impact on the first time adoption of the Standard for the year ending 30 June 2020 includes: • lease assets and financial liabilities on the balance sheet will increase approximately by $256,000 and $342,000 respectively (based on the facts at the date of the assessment) • the nature of expenses related to this lease will change as AASB 16 replaces the straight- line operating lease expense with a depreciation charge for the right of use asset and interest expense on the lease liability • operating cash outflows will be lower and financing cash flows will be higher in the statement of cash flows as principal repayments on all lease liabilities will now be included in financing activities rather than operating activities. Interest can also be included within financing activities. Standards and Interpretations adopted The Group has adopted AASB 9 Financial Instruments which came effective in the current year. The requirements of AASB 9 represent a significant change from AASB 139 Financial Instruments: Recognition and Measurement. The following is a summary of the material accounting policies adopted by the Consolidated Entity in the preparation of the financial statements. The accounting policies have been consistently applied unless otherwise stated. Changes in Accounting Policies 61 57 Icon Energy Annual Report 2019