Annual Report 2009 - Greentown China Holdings Limited

Notes to the Consolidated Financial Statements
For The Year Ended 31 December 2009
2. APPLICATION OF NEW AND REVISED INTERNATIONAL FINANCIAL REPORTING
STANDARDS (“IFRSs”) (Continued)
New and revised IFRSs affecting presentation and disclosure only (Continued)
IFRS 9 Financial Instruments introduces new requirements for the classification and measurement of financial
assets and will be effective from 1 January 2013, with earlier application permitted. The standard requires
all recognised financial assets that are within the scope of IAS 39 Financial Instruments: Recognition and
Measurement to be measured at either amortised cost or fair value. Specifically, debt investments that (i) are held
within a business model whose objective is to collect the contractual cash flows and (ii) have contractual cash
flows that are solely payments of principal and interest on the principal outstanding are generally measured at
amortised cost. All other debt investments and equity investments are measured at fair value. The application of
IFRS 9 might affect the classification and measurement of the Group’s financial assets.
The directors of the Company anticipate that the application of the other new and revised standards,
amendments or interpretations will have no material impact on the consolidated financial statements.
3. PRINCIPAL ACCOUNTING POLICIES
The consolidated financial statements have been prepared on the historical cost basis except for certain financial
instruments and investment property, which are measured at fair values, as explained in the accounting polices
set out below.
The consolidated financial statements have been prepared in accordance with International Financial Reporting
Standards. In addition, the consolidated financial statements include applicable disclosures required by the
Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited and by the Hong Kong
Companies Ordinance.
Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Company and entities
controlled by the Company (its subsidiaries). Control is achieved where the Company has the power to govern
the financial and operating policies of an entity so as to obtain benefits from its activities.
The results of subsidiaries acquired or disposed of during the year are included in the consolidated statement
of comprehensive income from the effective date of acquisition or up to the effective date of disposal, as
appropriate.
Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting
policies into line with those used by other members of the Group.
All significant intra-group transactions, balances, income and expenses are eliminated on consolidation.
Minority interests in the net assets of consolidated subsidiaries are presented separately from the Group’s equity
therein. Minority interests in the net assets consist of the amount of those interests at the date of the original
business combination and the minority’s share of changes in equity since the date of the combination. Losses
applicable to the minority in excess of the minority’s interest in the subsidiary’s equity are allocated against
the interests of the Group except to the extent that the minority has a binding obligation and is able to make an
additional investment to cover the losses.
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Greentown China Holdings Limited Annual Report 2009