YSA Annual Report 2018

YSA
ANNUAL REPORT
2018
42
YOUNG SIKH ASSOCIATION (SINGAPORE)
(Registered under The Societies Act. Cap. 311)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2018
FINANCIAL LIABILITIES (CONT’D)
A financial liability is derecognised when the obligation under the liability is extinguished.
When an existing financial liability is replaced by another from the same lender on
substantially different terms, or the terms of an existing liability are substantially modified,
such an exchange or modification is treated as a derecognition of the original liability
and the recognition of a new liability, and the difference in the respective carrying
amounts is recognised in the statement of comprehensive income.
c) CASH AND CASH EQUIVALENTS
Cash and cash equivalents comprise of cash in hand and bank balances placed with
creditworthy financial institutions.
d) PROVISIONS
Provisions are recognised when the Company has a present obligation where, as a result
of a past event, it is probable that an outflow of economic benefits will be required to
settle the obligation and the amount of the obligation can be reasonably estimated. Provisions
are reviewed at each balance sheet date and adjusted to reflect the current best
estimate. Where the effect of time value of money is material, the amount of the provision
is the present value of the expenditure expected to be required to settle the obligation.
e) TAXATION
Tax expense is determined on the basis of tax effect accounting, using the liability method,
and it is applied to all significant temporary differences arising between the carrying
amount of assets and liabilities in the financial statements and the corresponding tax
basis used in the composition of taxable profit, except that a debit to the deferred tax
balance is not carried forward unless there is a reasonable expectable of realization and
the potential tax saving relating to a tax loss carry forward and unutilized capital allowances
is not recorded as an asset.
Deferred tax is calculated at the tax rates that are expected to apply to the period when
the assets are realized or the liability is settled. Deferred tax is charged or credited to the
profit and loss account. Deferred tax assets and liabilities are offset when they relate to
income taxed levied by the same tax authority.