Note 1 – Summary of significant accounting policies  (continued) Cash flow hedges The effective portion of changes in the fair value of derivatives  that are designated and qualify as cash flow hedges is recognised  in other comprehensive income. The gain or loss relating to the  ineffective portion is recognised immediately in profit or loss.  Amounts previously recognised in other comprehensive income and  accumulated in equity are reclassified to profit or loss in the periods  when the hedged item is recognised in profit or loss, in the same  line of the income statement as the recognised hedged item.  However, when the forecast transaction that is hedged results in  the recognition of a non-financial asset or a non-financial liability,  the gains and losses previously accumulated in equity are  transferred from equity and included in the initial measurement  of the cost of the non-financial asset or non-financial liability. Hedge accounting is discontinued when the consolidated entity  revokes the hedging relationship, when the hedging instrument  expires or is sold, terminated, or exercised, or when it no longer  qualifies for hedge accounting. Any gain or loss accumulated in  equity at that time remains in equity and is recognised when  the forecast transaction is ultimately recognised in profit or loss.  When a forecast transaction is no longer expected to occur, the  gain or loss accumulated in equity is recognised immediately in  profit or loss.  Hedges of net investments in foreign operations  Hedges of net investments in foreign operations are accounted  for similarly to cash flow hedges. Any gain or loss on the hedging  instrument relating to the effective portion of the hedge is  recognised in other comprehensive income and accumulated in  the foreign currency translation reserve. The gain or loss relating to  the ineffective portion is recognised immediately in profit or loss.  Gains and losses on the hedging instrument relating to the  effective portion of the hedge accumulated in the foreign currency  translation reserve are reclassified to profit or loss when the foreign  operation is disposed of. Derivatives that do not qualify for hedge accounting –  economic hedges The consolidated entity has entered into certain derivative  instruments for economic hedging purposes under the Board  approved risk management policies which do not satisfy the  requirements for hedge accounting under AASB 139  Financial  Instruments: Recognition and Measurement . These derivatives are  therefore required to be categorised as held for trading and are  classified in the statement of financial position as economic hedges.  Changes in the fair value of any derivative instrument that does not  qualify for hedge accounting are recognised immediately in profit  or loss. (ac) Issued capital (ad) Revenue recognition Ordinary shares are classified as equity. Ordinary shares issued by  the consolidated entity are recorded at the proceeds received, less  transaction costs directly attributable to the issue of new shares,  net of any tax effects. Revenue is recognised and measured at the fair value of the  consideration received or receivable to the extent it is probable  that the economic benefits will flow to the consolidated entity  and the revenue can be reliably measured. Revenue from gas and electricity services supplied is recognised  once the gas and electricity has been delivered to the customer and  is measured through a regular review of usage meters. Customers  are billed on a periodic and regular basis. At the end of each  reporting period, gas and electricity revenue includes an accrual for  energy delivered to customers but not yet billed (unbilled revenue). Revenue from the provision of services, including revenue from  construction contracts, represents consideration received or  receivable determined, where appropriate, in accordance with the  percentage of completion method, with the stage of completion  of each contract determined by reference to the proportion that  contract costs for work performed to date bears to the estimated  total contract costs. Revenue from the sale of crude oil is recognised after each  shipment is loaded and title passes to the customer. Dividend income is recognised when the consolidated entity’s right  to receive the payment is established. (ae) Net financing costs Interest income is recognised as it accrues in profit or loss, using  the effective interest method. Finance costs directly attributable to the acquisition, construction  or production of qualifying assets, which are assets that necessarily  take a substantial period of time to get ready for their intended use  or sale, are added to the cost of those assets, until such time as the  assets are substantially ready for their intended use or sale. All other finance costs are recognised in profit or loss in the period  in which they are incurred. Finance costs comprise interest expense  on borrowings calculated using the effective interest method,  amortisation of borrowing costs relating to long-term financing  facilities, unwinding of the discount on provisions and gains and  losses on certain hedging instruments that are recognised in profit  or loss. (af) Goods and services tax Revenue, expenses and assets are recognised net of the amount of  goods and services tax (GST), except:  > where the amount of GST incurred is not recoverable from  the taxation authority, it is recognised as part of the cost of  acquisition of an asset or as part of an item of expense; or > for receivables and payables which are recognised inclusive  of GST. The net amount of GST recoverable from, or payable to, the  taxation authority is included as part of receivables or payables  in the statement of financial position. Cash flows are included in the statement of cash flows on a gross  basis. The GST component of cash flows arising from investing and  financing activities which is recoverable from, or payable to, the  taxation authority is classified within operating cash flows. (ag) Income tax Income tax expense represents the sum of the tax currently  payable and deferred tax. The tax currently payable is based on taxable profit for the year.  Taxable profit differs from profit as reported in the consolidated  income statement because of items of income or expense that are  taxable or deductible in other years and items that are never  taxable or deductible. The consolidated entity’s liability for current  tax is calculated using tax rates that have been enacted or  substantively enacted by the end of the reporting period. Current tax 76 Consolidated  Notes to the  Financial  Statements