ANNUAL%20REPORT%202015%20eng

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Notes to Consolidated Financial Statements 31 COMMITMENTS AND CONTINGENCIES (a) Capital commitments Capital commitments outstanding at respective balance sheet dates not provided for in the financial statements were as follows: 2015 2014 USD’000 USD’000 Contracted for 525 560 Authorised but not contracted for — — 525 560 (b) Operating lease commitments (i) At 31 December 2015, the total future minimum lease payments under non-cancellable operating leases are payable as follows: 2015 2014 USD’000 USD’000 Within 1 year 1,570 1,604 After 1 year but within 5 years 123 121 1,693 1,725 (ii) The Group leases certain buildings through operating leases. These operating leases do not contain provisions for contingent lease rentals. None of the agreements contain escalation provisions that may require higher future rental payments. (c) Environmental contingencies Historically, the Group has not incurred any significant expenditure for environmental remediation. Further, except for the accrued reclamation obligations as disclosed in Note 28 and amounts incurred pursuant to the environment compliance protection and precautionary measures in Mongolia, the Group has not incurred any other significant expenditure for environmental remediation, is currently not involved in any other environmental remediation, and has not accrued any other amounts for environmental remediation relating to its operations. Under existing legislation, the directors believe that there are no probable liabilities that will have a material adverse effect on the financial position or operating results of the Group. Environmental liabilities are subject to considerable uncertainties which affect the Group’s ability to estimate the ultimate cost of remediation efforts. The outcome of environmental liabilities under future environmental legislations cannot be estimated reasonably at present and which could be material. Annual Report 2015 191
Notes to Consolidated Financial Statements 32 MATERIAL RELATED PARTY TRANSACTIONS (a) Transactions with related parties Related parties refer to enterprises over which the Group is able to exercise significant influence or control during the year. During the year, the Group entered into transactions with the following related parties. Name of party MCS (Mongolia) Limited (“MCS Mongolia”) MCS Holding LLC (“MCS”) Uniservice Solution LLC (“Uniservice Solution”) MCS Property LLC (“MCS Property”) MCS Energy LLC (“MCS Energy”) MCS International LLC (“MCS International”) M Armor LLC (previously MCS Armor LLC) Relationship Shareholder Subsidiary of MCS Mongolia Subsidiary of MCS Mongolia Subsidiary of MCS Mongolia Subsidiary of MCS Mongolia Subsidiary of MCS Mongolia Subsidiary of MCS Mongolia Particulars of significant transactions between the Group and the above related parties during the year ended 31 December 2015 are as follows: 2015 2014 USD’000 USD’000 Ancillary services (Note (i)) 13,650 16,997 Purchases of equipment and construction work (Note (ii)) 25 1,667 Sales of property, plant and equipment (Note (iii)) 46 89 Lease of property, plant and equipment (Note (iv)) 703 729 Finance lease of equipment (Note (v)) — 16 Note: (i) (ii) (iii) (iv) (v) Ancillary services represent expenditures for support services such as cleaning and canteen expense paid to Uniservice Solution, MCS International, MCS and its affiliates. The service charges are based on comparable or prevailing market rates, were applicable. Purchases of equipment and construction work represent expenditure relating to equipment and construction service provided by MCS and its affiliates. The purchases are carried out at comparable or prevailing market rates, where applicable. Sales of property, plant and equipment represent sale to GS Road LLC, MCS and its affiliates. The sales are carried out at comparable or prevailing market rates, where applicable. Lease of property, plant and equipment represents rental paid or payable in respect of properties and office equipment leased from Shangri-La Ulaanbaatar LLC, MCS and its affiliates. The rental charges are based on comparable or prevailing market rates, where applicable. Finance leases of equipment represent expenditure relating to the lease of equipment from MCS and its affiliates through finance lease. The rental charges are based on comparable or prevailing market rates, where applicable. 192 Annual Report 2015
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(Incorporated in the Cayman Islands
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Company Profile Mongolian Mining Co
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Corporate Information BOARD OF DIRE
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Directors and Senior Management BOA
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Directors and Senior Management Gan
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Directors and Senior Management Une
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Directors and Senior Management SEN
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Group Structure 14 Annual Report 20
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Chairman’s Statement I believe th
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Management Discussion and Analysis
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Sustainability Report OUR APPROACH
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Sustainability Report Fair operatin
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Sustainability Report Figure 3. HR
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Sustainability Report The Company
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Sustainability Report In September
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Sustainability Report Figure 5. LTI
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Sustainability Report Biodiversity
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Sustainability Report In 2015, appr
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Sustainability Report There are num
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Sustainability Report OUR COMMUNITY
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Sustainability Report We receive gr
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Sustainability Report As part of th
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Sustainability Report Procurement W
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Corporate Governance Report BOARD O
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Corporate Governance Report Continu
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Corporate Governance Report Remuner
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Corporate Governance Report SHAREHO
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Directors’ Report The Directors s
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Directors’ Report Risk Management
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Directors’ Report FINANCIAL STATE
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Directors’ Report DIRECTORS’ SE
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Directors’ Report DIRECTORS’ AN
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Directors’ Report The basis of el
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Directors’ Report Details of the
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Directors’ Report RIGHTS TO PURCH
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Directors’ Report ER pledged its
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Directors’ Report At the time of
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Independent Auditor’s Report OPIN
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Consolidated Statement of Profit or
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Consolidated Statement of Financial
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Consolidated Cash Flow Statement Fo
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Notes to Consolidated Financial Sta
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ANNUAL%20REPORT%202015%20eng

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