ITF

NOTES FORMING PART OF THE FINANCIAL STATEMENTS 1. Basis of preparation The consolidated financial statements have been prepared on a going concern basis under the historical cost convention as modified by fair value accounting for forward currency contracts and investments, in accordance with IFRS 7. To make the distinction between operating and investing activities clearer, the Consolidated Income Statement separately shows income and expenses related to operations and to investing activities, i.e. the investment portfolio. The directors have prepared these statements as they are required by the member nations. Statement of compliance The consolidated financial statements have been prepared and approved by the directors in accordance with International Financial Reporting Standards. The functional and presentational currency of the ITF Trust is US Dollars and all values are rounded to the nearest thousand ($000) except when otherwise indicated. 2. Basis of consolidation The consolidated financial statements comprise the financial statements of the subsidiaries of ITF Trust as at 31 December each year. Subsidiaries are fully consolidated from the date of acquisition, being the date on which the Group obtains control, and continue to be consolidated until the date that such control ceases. The financial statements of the subsidiaries are prepared for the same reporting period as the parent company, with the exception of Hopman Cup Pty Ltd which has a year end reporting date of 31 March, and using consistent accounting policies. The results of Hopman Cup Pty Ltd from 1 January 2012 to 31 December 2012 have been consolidated in these financial statements. All intra group balances, income and expenses and unrealised gains and losses resulting from intra-group transactions are eliminated in full. The ITF Trust is domiciled in the Bahamas. The office of the ITF Trust is PO Box N-272, Nassau, Bahamas. The Board of Directors, which is responsible for the overall management of the ITF, including its strategic direction, holds its meetings outside the UK. The Wheelchair Tennis Foundation Netherlands, a venture jointly underwritten by ITF Limited and the Netherlands Tennis Federation, has not been consolidated on the grounds that the numbers are immaterial to the group accounts. The principal place of business of the ITF Trust is Bank Lane, Roehampton, London SW15 5XZ. 3. Principal activities The principal activities of the group are the development and administration of the game of tennis worldwide. 4. Changes in accounting policies The accounting policies adopted are consistent with those of the previous financial year. 5.Summary of significant accounting policies a) Revenue recognition Revenue is recognised to the extent that the revenue can be reliably measured in the year to which it relates. The following specific recognition criteria must also be met before revenue is recognised: i) Subscriptions & authorisation fees The annual contributions from the ITF member nations and the Official and Recognised Tennis Championships of the ITF are recognised in the period for which they are due. ii) Sponsorship, competition & television income Sponsorship income is recognised in accordance with the terms of the contract and the accounting period to which it relates. Television income is recognised on delivery of the programmes to broadcasters in accordance with the terms of the contract. Competition income is recognised in the period in which the competition took place. iii) Grand Slam Development Fund & Wheelchair Tennis Development Fund income The Grand Slam Development Fund and Wheelchair Tennis Development Fund income and expenditure are shown through the ITF's income and expenditure statement. Income is recognised when qualifying expenditure is made, with any difference between income and expenditure held on the balance sheet as deferred income or a debtor. The following wholly owned subsidiaries are included in the As at 31 December 2012, the Grand Slam Development consolidated financial statements: Fund had a reserve of $421,000 (2011: $1,097,000), and the Wheelchair Tennis Development Fund had a surplus of Country of registration $49,000 (2011: surplus of $32,000). ITF Limited Bahamas ITF Licensing (UK) Limited UK The mission of the Grand Slam Development Fund is to Roehampton Investments Limited Bahamas increase competitive tennis opportunities worldwide. Hopman Cup Pty Limited Australia iv) Anti-Doping income Hopman Cup Pty Ltd is a wholly owned subsidiary of ITF Anti-doping income is recognised in accordance with the terms Licensing (UK) Ltd. of the agreement and the accounting period to which it relates, where anti-doping services are provided for specific events. The South African Tennis Association Training Centre, Anti-doping income relating to penalties is recorded once a wholly owned subsidiary of ITF Limited, has not been it is probable that the economic benefit associated with the consolidated on the grounds that the numbers are immaterial transaction will flow to the Group. to the group accounts. 48 ITF FINANCIAL STATEMENTS

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