SINGAPORE WINDSOR HOLDINGS LIMITED
| Annual Report 2015
44
Year ended 31 March 2015
NOTES TO THE
FINANCIAL STATEMENTS
2.
Summary of significant accounting policies (cont’d)
Impairment of non-financial assets
Irrespective of whether there is any indication of impairment, an annual impairment test is performed at the same
time every year on an intangible asset with an indefinite useful life or an intangible asset not yet available for use.
The carrying amount of other non-financial assets is reviewed at each end of the reporting year for indications of
impairment and where an asset is impaired, it is written down through profit or loss to its estimated recoverable
amount. The impairment loss is the excess of the carrying amount over the recoverable amount and is recognised
in profit or loss. The recoverable amount of an asset or a cash-generating unit is the higher of its fair value less
costs of disposal and its value in use. When the fair value less costs of disposal method is used, any available recent
market transactions are taken into consideration. When the value in use method is adopted, in assessing the value
in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that
reflects current market assessments of the time value of money and the risks specific to the asset. For the purposes
of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash
flows (cash-generating units). At each end of the reporting year non-financial assets other than goodwill with
impairment loss recognised in prior periods are assessed for possible reversal of the impairment. An impairment
loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would
have been measured, net of depreciation or amortisation, if no impairment loss had been recognised.
Financial assets
Initial recognition, measurement and derecognition:
A financial asset is recognised on the statement of financial position when, and only when, the entity becomes
a party to the contractual provisions of the instrument. The initial recognition of financial assets is at fair value
normally represented by the transaction price. The transaction price for financial asset not classified at fair value
through profit or loss includes the transaction costs that are directly attributable to the acquisition or issue of
the financial asset. Transaction costs incurred on the acquisition or issue of financial assets classified at fair value
through profit or loss are expensed immediately. The transactions are recorded at the trade date.
Irrespective of the legal form of the transactions performed, financial assets are derecognised when they pass the
“substance over form” based on the derecognition test prescribed by FRS 39 relating to the transfer of risks and
rewards of ownership and the transfer of control. Financial assets and financial liabilities are offset and the net
amount is reported in the statement of financial position if there is currently a legally enforceable right to offset the
recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities
simultaneously.
Subsequent measurement:
Subsequent measurement based on the classification of the financial assets in one of the following categories
under FRS 39 is as follows:
1.
Financial assets at fair value through profit or loss: Assets are classified in this category when they are
incurred principally for the purpose of selling or repurchasing in the near term (trading assets) or are
derivatives (except for a derivative that is a designated and effective hedging instrument) or have been
classified in this category because the conditions are met to use the “fair value option” and it is used. All
changes in fair value relating to assets at fair value through profit or loss are recognised directly in profit or
loss.
