c. Foreign currency While the presentation currency of the Group is US dollars, entities in the Group may have other functional currencies, reflecting the currency of the primary economic environment in which the relevant entity operates. The parent entity, CSL Limited, has a functional currency of US dollars. Any exchange differences arising from the translation of a foreign operation previously recognised in other comprehensive income are not reclassified from equity to the profit or loss until the disposal of the operation. If an entity in the Group has undertaken transactions in a foreign currency, these transactions are translated into that entity’s functional currency using the exchange rates prevailing at the dates of the transactions. Where the functional currency of a subsidiary is not US dollars, the subsidiary’s assets and liabilities are translated on consolidation to US dollars using the exchange rates prevailing at the reporting date, and its profit or loss is translated at average exchange rates. All resulting exchange differences are recognised in other comprehensive income (OCI) and in the foreign currency translation reserve (FCTR) in equity. d. Material accounting policies Material accounting policies that summarise the measurement basis used and are relevant to an understanding of the financial statements are provided throughout the notes to the financial statements. There were no material changes in accounting policies during the year ended 30 June 2026, nor did the introduction of new accounting standards lead to any change in measurement or disclosure in these financial statements. The Group has not adopted any accounting standards that are issued but not yet effective. e. Key judgements and estimates In the process of applying the Group’s accounting policies, a number of judgements and estimates of future events are required. Material judgements and estimates are found in the following notes: Note 3: Restructuring and Impairment Expenses Page 99 Note 4: Tax Page 104 Note 5: Inventories Page 106 Note 6: People Costs Page 107 Note 11: Financial Risk Management Page 113 f. Sustainability considerations The Group adopted Australian Sustainability Reporting Standard AASB S2 Climate-related Disclosures (AASB S2) for the year ended 30 June 2026. AASB S2 requires entities to disclose material information about climate-related risks and opportunities to enable users of the financial report to assess the effects of climate-related matters on the Group’s financial position, financial performance and cash flows, as well as its strategy and business model. The Group undertook a structured assessment to identify climate-related transition and physical risks across its operations, activities and value chain. This assessment was informed by internal and external data, stakeholder engagement and climate scenario analysis, and considered impacts across short, medium and long-term time horizons. Transition risks were identified primarily in relation to impacts from carbon pricing and energy market volatility. Physical risks were identified through the assessment of acute and chronic climate hazards, including extreme heat, flooding and severe weather events, which may affect the Group’s manufacturing facilities, logistics and supply chain. In applying AASB S2, the Group assessed the financial effects of the identified climate-related risks on its financial results, including potential impacts on the valuation and useful lives of tangible and intangible assets and on the recognition of provisions. Based on this assessment, no material impact on the Group’s results was identified for the year ended 30 June 2026. Further information on how climate-related risks have been considered in the Group’s key accounting estimates is disclosed below. Note 8: Intangible Assets Page 109 Note 9: Property, Plant and Equipment Page 111 The Group continues to monitor climate-related developments and will update its assessment as required in future reporting periods. Further information on CSL’s climate-related risks, governance and strategy is set out in the 2026 Sustainability Report, which forms part of the Directors’ Report. g. The notes to the financial statements The notes to these financial statements have been organised into logical groupings to help users find and understand the information they need. Where possible, related information has been provided in the same place. More detailed information (for example, valuation methodologies and certain reconciliations) has been placed at the rear of the document and cross-referenced where necessary. CSL has also reviewed the notes for materiality and relevance and provided additional information where it is helpful to an understanding of the Group’s performance. Details of the Group’s significant non-recurring items comprising restructuring and impairment expenses recognised during the year ended 30 June 2026 are provided in Note 3. 93 Notes to the Financial Statements 93 CSL Limited Annual Report 2025/26
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