SINGAPORE WINDSOR HOLDINGS LIMITED
| Annual Report 2015
47
Year ended 31 March 2015
NOTES TO THE
FINANCIAL STATEMENTS
2.
Summary of significant accounting policies (cont’d)
Assets classified as held for sale (cont’d)
In addition, the results of discontinued operations are presented separately in profit or loss. A discontinued
operation is a component of the business that represents a separate major line of business or geographical area of
operations that has been sold, or classified as held for sale or has been abandoned. They are shown separately in
profit or loss and comparative figures are restated to reclassify them from continuing to discontinued operations.
Fair value measurement
Fair value is taken to be the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date (that is, an exit price). It is a market-based
measurement, not an entity-specific measurement. When measuring fair value, management uses the assumptions
that market participants would use when pricing the asset or liability under current market conditions, including
assumptions about risk. The entity’s intention to hold an asset or to settle or otherwise fulfil a liability is not taken
into account as relevant when measuring fair value. In making the fair value measurement, management determines
the following: (a) the particular asset or liability being measured (these are identified and disclosed in the relevant
notes below); (b) for a non-financial asset, the highest and best use of the asset and whether the asset is used in
combination with other assets or on a stand-alone basis; (c) the market in which an orderly transaction would take
place for the asset or liability; and (d) the appropriate valuation techniques to use when measuring fair value. The
valuation techniques used maximise the use of relevant observable inputs and minimise unobservable inputs. These
inputs are consistent with the inputs a market participant may use when pricing the asset or liability.
The fair value measurements and related disclosures categorise the inputs to valuation techniques used to measure
fair value by using a fair value hierarchy of three levels. These are recurring fair value measurements unless stated
otherwise in the relevant notes to the financial statements. Level 1 inputs are quoted prices (unadjusted) in active
markets for identical assets or liabilities that the entity can access at the measurement date. Level 2 inputs are
inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly
or indirectly. Level 3 inputs are unobservable inputs for the asset or liability. The level is measured on the basis of
the lowest level input that is significant to the fair value measurement in its entirety. Transfers between levels of the
fair value hierarchy are deemed to have occurred at the beginning of the reporting year. If a financial instrument
measured at fair value has a bid price and an ask price, the price within the bid-ask spread or mid-market pricing
that is most representative of fair value in the circumstances is used to measure fair value regardless of where the
input is categorised within the fair value hierarchy. If there is no market, or the markets available are not active, the
fair value is established by using an acceptable valuation technique.
The carrying values of current financial instruments approximate their fair values due to the short-term maturity
of these instruments and the disclosures of fair value are not made when the carrying amount of current financial
instruments is a reasonable approximation of the fair value. The fair values of non-current financial instruments may
not be disclosed separately unless there are significant differences at the end of the reporting year and in the event
the fair values are disclosed in the relevant notes to the financial statements.
Classification of equity and liabilities
A financial instrument is classified as a liability or as equity in accordance with the substance of the contractual
arrangement on initial recognition. Equity instruments are contracts that give a residual interest in the net assets
of the reporting entity. Where the financial instrument does not give rise to a contractual obligation on the part
of the issuer to make payment in cash or kind under conditions that are potentially unfavourable, it is classified
as an equity instrument. Ordinary shares are classified as equity. Equity instruments are recognised at the amount
of proceeds received net of incremental costs directly attributable to the transaction. Dividends on equity are
recognised as liabilities when they are declared. Interim dividends are recognised when declared by the directors.
