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Revenue RecognitionThe Group recognises revenue from partly completed projects based on the stage of completion method.The stage of completion is measured in accordance with the accounting policy stated in (j) below. Significantassumptions are required in determining the stage of completion, the total estimated development costs and theestimated total revenue. In making the assumptions, the Group evaluates them by relying on past experience andthe work of professionals and specialists. Revenue from partly completed projects is disclosed in Note 2.Income TaxesThe Group has exposure to income taxes in numerous jurisdictions. Significant assumption is required indetermining the provision for income taxes. There are certain transactions and computations for which the ultimatetax determination is uncertain during the ordinary course of business. The Group recognises liabilities for expectedtax issues based on estimates of whether additional taxes will be due. Where the final tax outcome of thesematters is different from the amounts that were initially recognised, such differences will impact the income tax anddeferred tax provisions in the year in which such determination is made. The carrying amounts of taxation anddeferred taxation are disclosed in the balance sheet.(ii)Critical Judgement in Applying the Group’s Accounting PoliciesIn the process of applying the Group’s accounting policies, management is of the opinion that the instances ofapplication of judgement are not expected to have a significant effect on the amounts recognised in the financialstatements, apart from those involving estimations.(c)Subsidiaries and Principles of Consolidation(i) SubsidiariesA subsidiary is an entity over which the Group has the power to govern the financial and operating policies so as toobtain benefits from its activities. The existence and effect of potential voting rights that are currently exercisable orconvertible are considered when assessing whether the Group controls another entity.Investments in subsidiary companies are stated in the accounts of the Company at cost less impairment loss.(ii)Principles of ConsolidationThe consolidated financial statements comprise the financial statements of the Company and its subsidiaries as atthe balance sheet date. The financial statements of the subsidiaries are prepared for the same reporting date as theparent company. Consistent accounting policies are applied for like transactions and events in similarcircumstances.All intra-group balances, transactions, income and expenses and profits and losses resulting from intra-grouptransactions that are recognised in assets are eliminated in full.Subsidiaries are fully 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.Acquisitions of subsidiaries are accounted for using the purchase method. The cost of an acquisition is measuredas the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date ofexchange, plus costs directly attributable to the acquisition. Identifiable assets acquired and liabilities andcontingent liabilities assumed in a business combination are measured initially at their fair values at the acquisitiondate, irrespective of the extent of any minority interest.Summary of significant accounting policiesKeppel Land LimitedReport to Shareholders 2006181