2011 Annual Report - TOM Group

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56 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 1 Principal accounting policies (Continued) (f) Financial assets The Group classifies its financial assets in the following categories: loans and receivables, and available-for-sale. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of its financial assets at initial recognition. (i) (ii) Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for maturities greater than 12 months after the end of the reporting period which are classified as non-current assets. The Group’s loans and receivables comprise “trade and other receivables”, “advance to an investee company”, “cash and cash equivalents” and “restricted cash” in the consolidated statement of financial position. Available-for-sale financial assets Available-for-sale financial assets are non-derivatives that are either designated in this category or not classified in any of the other categories. They are included in noncurrent assets unless the investment matures or management intends to dispose it within 12 months of the end of the reporting period. Regular way purchases and sales of financial assets are recognised on the trade-date – the date on which the Group commits to purchase or sell the asset. Investments are initially recognised at fair value plus transaction costs. Financial assets are derecognised when the rights to receive cash flows from the investments have expired or have been transferred and the Group has transferred substantially all risks and rewards of ownership. Available-for-sale financial assets are subsequently carried at fair value. Loans and receivables are subsequently carried at amortised cost using the effective interest method. Changes in the fair value of monetary securities denominated in a foreign currency and classified as available-for-sale are analysed between translation differences resulting from changes in amortised cost of the security and other changes in the carrying amount of the security. Translation differences related to changes in amortised cost are recognised in profit or loss and other changes in carrying amount are recognised in other comprehensive income. Translation differences on non-monetary securities are recognised in other comprehensive income. Changes in the fair value of monetary and non-monetary securities classified as available-for-sale are recognised in other comprehensive income. When securities classified as available-for-sale are sold or impaired, the accumulated fair value adjustments recognised in equity are included in the consolidated income statement as gains or losses from available-for-sale financial assets. TOM Group Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 1 Principal accounting policies (Continued) (f) Financial assets (Continued) Interest on available-for-sale financial assets calculated using the effective interest method is recognised in the consolidated income statement. Dividends on available-for-sale equity investments are recognised in the consolidated income statement as part of other income when the Group’s right to receive payments is established. The fair value of quoted investments is based on current bid prices. If the market for a financial asset is not active (and for unlisted securities), the Group establishes fair value by using valuation techniques. These include the use of recent arm’s length transactions, reference to other instruments that are substantially the same, or discounted cash flow analysis refined to reflect the issuer’s specific circumstances. Investments in equity instruments that do not have a quoted market price in an active market and those fair value cannot be reliably measured, are measured at cost less impairment. Financial assets and liabilities are offset and the net amount reported in the statement of financial position when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously. The Group assesses at the end of each reporting period whether there is objective evidence that a financial asset or a group of financial assets is impaired. In the case of equity securities classified as available-for-sale, a significant or prolonged decline in the fair value of the security below its cost is considered as an indicator that the securities are impaired. If any such evidence exists for available-for-sale financial assets, the cumulative loss – measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that financial asset previously recognised in profit and loss – is removed from equity and recognised in the consolidated income statement. Impairment losses recognised in the consolidated income statement on equity instruments are not reversed through the consolidated income statement. Impairment testing of trade receivables is described in note 1(l). (g) Fixed assets Fixed assets are stated at historical cost less depreciation and any impairment loss. Properties include leasehold land and buildings. Historical cost includes expenditure that is directly attributable to the acquisition of the items. Depreciation of fixed assets is provided at rates calculated to write off their costs over their estimated useful lives on a straight-line basis at the following annual rates: Properties over the shorter of the unexpired term of land lease or estimated useful lives of 50 years Leasehold improvements over the shorter of the lease terms or their useful lives of 5 years Computer equipment 20%- 33 1 / 3 % Outdoor media assets 5%- 20% Other assets 10%- 33 1 / 3 % Annual Report 2011 57
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CONTENTS CONTENTS 19 11 21 11 47 37
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2 CORPORATE PROFILE TOM Group Limit
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4 FINANCIAL HIGHLIGHTS For the year
Page 8 and 9: 6 MANAGEMENT’S DISCUSSION AND ANA
Page 10 and 11: 8 MANAGEMENT’S DISCUSSION AND ANA
Page 12 and 13: 10 MANAGEMENT’S DISCUSSION AND AN
Page 14 and 15: 12 DIRECTORS’ PROFILE Ip Tak Chue
Page 16 and 17: 14 CORPORATE GOVERNANCE REPORT The
Page 20 and 21: 18 CORPORATE GOVERNANCE REPORT Upon
Page 26 and 27: 24 CORPORATE GOVERNANCE REPORT Corp
Page 30 and 31: 28 REPORT OF THE DIRECTORS Director
Page 32 and 33: 30 REPORT OF THE DIRECTORS (e) (f)
Page 34 and 35: 32 REPORT OF THE DIRECTORS Director
Page 36 and 37: 34 REPORT OF THE DIRECTORS Interest
Page 38 and 39: 36 REPORT OF THE DIRECTORS Li Ka-Sh
Page 40 and 41: 38 REPORT OF THE DIRECTORS (d) (e)
Page 42 and 43: 40 REPORT OF THE DIRECTORS During t
Page 44 and 45: 42 INDEPENDENT AUDITOR’S REPORT I
Page 46 and 47: 44 CONSOLIDATED INCOME STATEMENT Fo
Page 48 and 49: 46 CONSOLIDATED STATEMENT OF FINANC
Page 50 and 51: 48 STATEMENT OF FINANCIAL POSITION
Page 52 and 53: 50 CONSOLIDATED STATEMENT OF CHANGE
Page 54 and 55: 52 NOTES TO THE CONSOLIDATED FINANC
Page 102 and 103: 100 NOTES TO THE CONSOLIDATED FINAN
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106 NOTES TO THE CONSOLIDATED FINAN
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124 PRINCIPAL SUBSIDIARIES, JOINTLY
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2011 Annual Report - TOM Group

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