Statement of Financial Position30 June <strong>2012</strong>30 June 31 DecemberNotes <strong>2012</strong> 2011RMB’000RMB’000NON-CURRENT ASSETSInterest in subsidiaries 17 190,234 70,859Total non-current assets 190,234 70,859CURRENT ASSETSPrepayments, deposits and other receivables 21 2,388 Cash and cash equivalents 22 1 114,379Total current assets 2,389 114,379NET CURRENT ASSETS 2,389 114,379Net assets 192,623 185,238EQUITYEquity attributable to owners of the CompanyIssued capital 28 9,252 9,262Reserves 30 183,371 175,976Total equity 192,623 185,238Wang HuiminDirectorKang JieDirectorINTERIM REPORT <strong>2012</strong> 23
Notes to Financial Statements30 June <strong>2012</strong>1. CORPORATE INFORMATIONThe Company was incorporated in the Cayman Islands on 2 February 2010 as an exempted <strong>com</strong>pany with limited liability underthe Companies Law of the Cayman Islands. The registered office of the Company is located at the offices of Codan Trust Company(Cayman) Limited, Cricket Square, Hutchins Drive, P.O. Box 2681, Grand Cayman, KY1-1111, Cayman Islands. The shares of theCompany were listed on the Main Board of The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) on 4 July <strong>2012</strong> (the“Listing”).The principal activity of the Company is investment holding. The subsidiaries of the Company are principally engaged in the operationof Chinese restaurant chain stores in Mainland China and Hong Kong. There were no significant changes in the nature of the Group’sprincipal activities during the period. Particulars of the <strong>com</strong>panies now <strong>com</strong>prising the Group are set out in Note 17 of the financialstatements below.2.1 BASIS OF PREPARATIONThese financial statements have been prepared in accordance with International Financial <strong>Report</strong>ing Standards (“IFRSs”) (whichinclude all International Financial <strong>Report</strong>ing Standards, International Accounting Standards (“IASs”) and Interpretations) issued by theInternational Accounting Standards Board (the “IASB”) and the disclosure requirements of the Hong Kong Companies Ordinance.They have been prepared under the historical cost convention. These financial statements are presented in Renminbi (“RMB”) and allvalues are rounded to the nearest thousand except when otherwise indicated.Basis of consolidationThrough a group reorganisation (the “Reorganisation”) as set out in the section headed “History and Development” in theProspectus dated 21 June <strong>2012</strong> for the public listing of the Company’s shares on the Stock Exchange, the Company became theholding <strong>com</strong>pany of the <strong>com</strong>panies now <strong>com</strong>prising the Group on 10 August 2010. Before the Reorganisation and formation ofthe Group, the listing business was carried out by the subsidiaries now <strong>com</strong>prising the Group as set out in Note 17 of the financialstatements, all of which were collectively controlled by Ms. Wang Huimin (the “Controlling Shareholder”). The acquisition ofsubsidiaries and business under <strong>com</strong>mon control has been accounted for using merger accounting.The merger method of accounting involves incorporating the financial statement items of the <strong>com</strong>bining entities or businessesin which the <strong>com</strong>mon control <strong>com</strong>bination occurs as if they had been <strong>com</strong>bined from the date when the <strong>com</strong>bining entities orbusinesses first came under the control of the controlling party. No amount is recognised in respect of goodwill or the excess of theacquirers’ interest in the net fair value of acquirees’ identifiable assets, liabilities and contingent over the cost of investment at thetime of <strong>com</strong>mon control <strong>com</strong>bination. The acquisition of subsidiaries other than those under <strong>com</strong>mon control has been accounted forusing the purchase method of accounting.The financial statements of the subsidiaries are prepared for the same reporting period as the Company, using consistent accountingpolicies. The results of subsidiaries are consolidated from the date of acquisition, being the date on which the Group obtains control,and continue to be consolidated until the date that such control ceases. All intra-group balances, transactions, unrealised gains andlosses resulting from intra-group transactions and dividends are eliminated on consolidation in full.Adjustments are made to bring into line any dissimilar accounting policies that may exist.Total <strong>com</strong>prehensive in<strong>com</strong>e within a subsidiary is attributed to the non-controlling interest even if that results in a deficit balance.A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction.24XIAO NAN GUO RESTAURANTS HOLDINGS LIMITED
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