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Notes to the financial statements
(e)
Changes in accounting policies
Overview
As of 1 April 2009 on adoption of new/revised FRS, A-REIT has changed its accounting policies in the
following areas:
• Determination and presentation of operating segments;
• Measurement of investment properties under development; and
• Disclosures pertaining to fair values for financial instruments
Determination and presentation of operating segments
As of 1 April 2009, A-REIT determines and presents operating segments based on the information that
is internally provided to A-REIT’s Chief Operating Decision Maker (“CODM”). This change in accounting
policy is due to the adoption of FRS 108 Operating Segments. Previously, operating segments were
determined and presented in accordance with FRS 14 Segment Reporting. The new accounting policy
in respect of operating segments disclosures is presented in note 3(l) and has no material impact on
comparative segment information and earnings per unit.
Measurement of investment properties under development
In accordance with amendments made to FRS 40 Investment Property, any property that is being
constructed or developed for future use as an investment property is classified as an investment property.
As A-REIT has adopted the fair value model for its investment properties, it will account for investment
properties under development using the fair value model, with any changes in fair value recognised in the
Statement of Total Return as a net change in the fair value of investment properties. In accordance with
the transitional provisions of FRS 40, the change in accounting policy has been applied prospectively.
Disclosures pertaining to fair values for financial instruments
A-REIT has applied Improving Disclosures about Financial Instruments (Amendments to FRS 107
Financial Instruments: Disclosures), issued in April 2009, that require enhanced disclosures about fair
value measurements and liquidity risk in respect of financial instruments.
The amendments require that fair value measurement disclosures use a three-level fair value hierarchy
that reflects the significance of the inputs used in measuring fair values of financial instruments. Specific
disclosures are required when fair value measurements are categorised as Level 3 (significant unobservable
inputs) in the fair value hierarchy. The amendments require that any significant transfers between Level 1
and Level 2 of the fair value hierarchy be disclosed separately, distinguishing between transfers into and
out of each level. Furthermore, changes in valuation techniques from one period to another, including
the reasons therefore, are required to be disclosed for each class of financial instruments.
Revised disclosures in respect of the fair values of financial instruments are included in note 29.
124 Ascendas real estate investment trust