2014 Financial Statement

EDC 2014 Performance Report
This interpretation has no impact on the Company as it has applied the recognition principles
under PAS 37, Provisions, Contingent Liabilities and Contingent Assets, consistent with the
requirements of IFRIC 21 in prior years.
Annual Improvements to PFRSs (2010-2012 cycle)
In the 2010 - 2012 annual improvements cycle, seven amendments to six standards were issued,
which included an amendment to PFRS 13, Fair Value Measurement. The amendment to PFRS 13
is effective immediately and it clarifies that short-term receivables and payables with no stated
interest rates can be measured at invoice amounts when the effect of discounting is immaterial.
This amendment has no impact on the Company.
Annual Improvements to PFRSs (2011-2013 cycle)
In the 2011 - 2013 annual improvements cycle, four amendments to four standards were issued,
which included an amendment to PFRS 1, First-time Adoption of Philippine Financial Reporting
Standards-First-time Adoption of PFRS. The amendment to PFRS 1 is effective immediately. It
clarifies that an entity may choose to apply either a current standard or a new standard that is not
yet mandatory, but permits early application, provided either standard is applied consistently
throughout the periods presented in the entity’s first PFRS financial statements. This amendment
has no impact on the Company as it is not a first time PFRS adopter.
3.
Significant Accounting Judgments, Estimates and Assumptions
The preparation of the consolidated financial statements requires management to make judgments,
estimates and assumptions that affect the reported amounts of revenues, expenses, assets and
liabilities, and the disclosure of contingent liabilities, at the financial reporting date. Uncertainty
about these assumptions and estimates could result in outcomes that require material adjustments
to the carrying amounts of assets or liabilities in the future.
Judgments
In the process of applying the Company’s accounting policies, management has made the
following judgments, which have the most significant effect on the amounts recognized in the
consolidated financial statements:
Functional Currency
The Parent Company’s transactions are denominated or settled in various currencies such as the
Peso, United States dollar (US$), and Japanese yen (JPY). The Parent Company has determined
that its functional currency is the Peso, which is the currency that most faithfully represents the
economic substance of its underlying transactions, events and conditions.
Discontinued Operations
In October 2012, the Company has completed its contract with Lihir Gold Ltd. (Lihir) in Papua
New Guinea for the provision of drilling services. In line with its current strategy, the Company
will no longer engage in drilling activities but will maintain its major business of selling electricity.
Management considered that the drilling operations met the definition of discontinued operations,
which is a component that has been terminated and is comprised of operations and cash flows that
can be clearly distinguished operationally and for financial reporting purposes, from the rest of the
Company.
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