2011 Annual Report - TOM Group

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
%
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