0175 Geely Automobile Holdings Limited Annual Report 2011

More documents

Recommendations

Info

Annual Report 2011Geely Automobile Holdings LimitedNOTES TO THE CONSOLIDATEDFINANCIAL STATEMENTSFor the year ended 31 December 20115. Significant Accounting Policies (Continued)(d)Intangible assets (other than goodwill)Intangible assets acquired separately are recognised initially at cost. After initial recognition, intangible assetswith finite useful lives are carried at cost less accumulated amortisation and any accumulated impairmentlosses. Amortisation for intangible assets with finite useful lives is provided on a straight-line basis overtheir estimated useful lives. Amortisation begins when the asset is available for use (i.e. when it is in thelocation and condition necessary for it to be capable of operating in the manner intended by management).The following useful lives are applied:Capitalised development costs5 to 10 yearsResearch and development costsCosts associated with research activities are expensed in the consolidated income statement as they occur.Costs that are directly attributable to the development phase are recognised as intangible assets providedthey meet the following recognition requirements:(i)(ii)(iii)(iv)(v)(vi)demonstration of technical feasibility of the prospective product for internal use or sale;there is an intention to complete the intangible asset and use or sell it;the Group’s ability to use or sell the intangible asset is demonstrated;the intangible asset will generate probable economic benefits through internal use or sale;sufficient technical, financial and other resources are available for completion; andthe expenditure attributable to the intangible asset can be reliably measured.Direct costs include employee costs incurred on development along with an appropriate portion of relevantoverheads. The costs of internally generated product developments are recognised as intangible assets.They are subject to the same subsequent measurement method as externally acquired intangible assets.All other development costs are expensed as incurred.(e)(f)InventoriesInventories are stated at the lower of cost and net realisable value. Cost, which comprises all costs ofpurchase and, where applicable, cost of conversion and other costs that have been incurred in bringing theinventories to their present location and condition, is calculated using the weighted average method. Netrealisable value represents the estimated selling price in the ordinary course of business less the estimatedcosts of completion and the estimated costs necessary to make the sale.Foreign currenciesIn preparing the financial statements of each individual group entity, transactions in currencies other thanthe functional currency of that entity (foreign currencies) are recorded in its functional currency (i.e. thecurrency of the primary economic environment in which the entity operates) at the rates of exchangeprevailing on the dates of the transactions. At each balance sheet date, monetary items denominated inforeign currencies are retranslated at the rates prevailing on the balance sheet date. Non-monetary itemscarried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing onthe date when the fair value was determined. Non-monetary items that are measured in terms of historicalcost in a foreign currency are not retranslated.69
Annual Report 2011Geely Automobile Holdings LimitedNOTES TO THE CONSOLIDATEDFINANCIAL STATEMENTSFor the year ended 31 December 20115. Significant Accounting Policies (Continued)(f)Foreign currencies (Continued)Exchange differences arising on the settlement of monetary items, and on the translation of monetaryitems, are recognised in the consolidated income statement in the period in which they arise, except forexchange differences arising on a monetary item that forms part of the Company’s net investment in aforeign operation, in which case such exchange differences are recognised in other comprehensive income.Exchange differences arising on the retranslation of non-monetary items carried at fair value are includedin the consolidated income statement for the period except for differences arising on the retranslation ofnon-monetary items in respect of which gains and losses are recognised directly in other comprehensiveincome, in which cases, the exchange differences are also recognised directly in other comprehensiveincome.For the purposes of presenting the consolidated financial statements, the assets and liabilities of theGroup’s foreign operations are translated into the presentation currency of the Company (i.e. Renminbi) atthe rate of exchange prevailing at the balance sheet date, and their income and expenses are translatedat the average exchange rates for the year, unless exchange rates fluctuate significantly during the period,in which case, the exchange rates prevailing at the dates of transactions are used. Exchange differencesarising, if any, are recognised in other comprehensive income and accumulated in a separate componentof equity (the translation reserve). Such exchange differences are reclassified from equity to profit or lossas a reclassification adjustment in the period in which the foreign operation is disposed of.(g)Financial instrumentsFinancial assets and financial liabilities are recognised on the consolidated balance sheet when a groupentity becomes a party to the contractual provisions of the instrument. Financial assets and financialliabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisitionor issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fairvalue through profit or loss) are added to or deducted from the fair value of the financial assets or financialliabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition offinancial assets or financial liabilities at fair value through profit or loss are recognised immediately in theconsolidated income statement.Loans and receivablesLoans and receivables are non-derivative financial assets with fixed or determinable payments that arenot quoted in an active market. Loans and receivables (including trade and other receivables) are initiallyrecognised at fair value, and are subsequently measured at amortised cost using the effective interestmethod less any identified impairment losses. An impairment loss is recognised in the consolidated incomestatement when there is objective evidence that the asset is impaired, and is measured as the differencebetween the asset’s carrying amount and the present value of the estimated future cash flows discountedat the original effective interest rate.Objective evidence of impairment of individual financial assets includes observable data that comes to theattention of the Group about one or more of the following loss events:– Significant financial difficulty of the debtor;– A breach of contract, such as a default or delinquency in interest or principal payments;– It becoming probable that the debtor will enter bankruptcy or other financial reorganisation; and– Significant changes in the technological, market, economic or legal environment that have an adverseeffect on the debtor.70
Page 1 and 2:
(Stock Code : 0175)
Page 3 and 4:
KeyFiguresTurnover(RMB’Billion)22
Page 5 and 6:
Annual Report 2011Geely Automobile
Page 7 and 8:
ManagementReportOrganisationChart
Page 9 and 10:
Page 11 and 12:
Page 13 and 14:
Page 15 and 16:
Page 17 and 18:
Page 19 and 20: Annual Report 2011Geely Automobile
Page 29: Annual Report 2011Geely Automobile
Page 54 and 55: Accounts
Page 58 and 59: CONSOLIDATEDSTATEMENT OF COMPREHENS
Page 121 and 122:
Page 123 and 124:
Page 125 and 126:
Page 127 and 128:
Page 129 and 130:
Page 131 and 132:
Page 133 and 134:
show all

0175 Geely Automobile Holdings Limited Annual Report 2011

Create successful ePaper yourself

Delete template?

Save as template?