Annual Report - QuamIR

Notes to the Consolidated Financial Statements (Continued)
4 Critical accounting estimates and judgements (Continued)
(i) Allowances for bad and doubtful debts
The policy for allowance for bad and doubtful debts of the Group
is based on the evaluation of collectability and ageing analysis
of receivables and management’s judgement. A considerable
amount of judgement is required in assessing the ultimate
realisation of these receivables, including the creditworthiness
and the past collection history of each customer.
4
(i)
(j)
Fair value of financial and equity instruments
(j)
Where the fair value of equity instruments or financial assets
and financial liabilities recorded in the balance sheet cannot be
derived from active markets, they are determined using valuation
techniques including the use of recent arm’s length transactions,
reference to other instruments that are substantially the same,
discounted cash flow analysis, option pricing model and share
prices of the Company. The inputs to these models are taken
from observable markets where possible, but where this is not
feasible. A degree of judgment is required in establishing fair
values.
5 Segment information
Segment information disclosed in the annual report has been prepared
in a manner consistent with the information used by the Group’s most
senior executive management for the purposes of assessing segment
performance and allocating resources between segments. In this
regard, the Group is organised into the following segments: Properties
development (for sale or lease upon completion of construction work),
Property investment and leasing, Infrastructure, Alternative energy,
Construction, Hotel and catering services and Other operations.
5
The Group’s most senior executive management assesses the
performance of the operating segments based on operating profit/(loss)
after interest income and expenses, taxation and share of profits/(losses)
of associated companies and jointly controlled entities. Corporate
expenses mainly include the employee expenses of the head office,
interest income and expenses arising from the holding companies and
other administrative expenses of the head office.
122 HKC (Holdings) Limited • Annual Report 2011