NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS for the period ended 28 July 2018 F2 RETAINED EARNINGS/(ACCUMULATED LOSSES) AND RESERVES (CONTINUED) Accounting policy (continued) (iii) Group companies The results and financial position of foreign operations (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows: •assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that balance sheet; income and expenses for each income statement and statement of comprehensive income are translated at the rates prevailing on the• transaction dates; and • all resulting exchange differences are recognised in other comprehensive income. On consolidation, when a foreign operation is sold, the associated exchange difference is reclassified to profit or loss, as part of the gain or loss on sale. F3 DIVIDENDS 2018 2017 $'000 $'000 (a) Ordinary shares Final fully franked dividend for the period ending 29 July 2017 of 2.0 cents (30 July 2016: 3.0 cents) per fully paid share paid 8 November 2017 (2017: 10 November 2016) 16,426 24,638 Interim fully franked dividend for the period ended 28 July 2018 of nil (2017: 3.0 cents) per fully paid share (2017: 4 May 2017) 24,638 - Total dividends paid 16,426 49,276 (b) Dividends not recognised at the end of the reporting period The directors have determined that no final dividend will be payable (2017: 2.0 cents per fully paid ordinary share fully franked based on tax paid at 30%) The aggregate amount of the proposed dividend expected to be paid after period end, but not recognised as a liability at period end, is: - 16,426 (c) Franked dividends The franked portions of the final dividends recommended after 28 July 2018 will be franked out of existing franking credits or out of franking credits arising from the payment of income tax in the period ending 27 July 2019 Franking credits available for subsequent financial periods based on a tax rate of 30% (2017: 30%) 40,277 32,690 The above amounts represent the balance of the franking account as at the reporting date, adjusted for: (a) franking credits that will arise from the payment of the amount of the provision for income tax; (b) franking debits that will arise from the payment of dividends recognised as a liability at the reporting date; and (c) franking credits that will arise from the receipt of dividends recognised as receivables at the reporting date. The consolidated amounts include franking credits that would be available to the parent entity if distributable profits of subsidiaries were paid as dividends. The impact on the franking account of the dividend recommended by the directors since the end of the reporting period, but not recognised as a liability at the reporting date, will be a reduction in the franking account of nil (2017: $7 million). Accounting policy Provision is made for the amount of any dividend declared, being appropriately authorised and no longer at the discretion of the entity, on or before the end of the financial period but not distributed at balance date. Myer Annual Report 2018 75