Directors - Boustead Holdings Berhad

Accounting Policies
(i) DEVELOPMENT PROPERTIES AND PROPERTY DEVELOPMENT IN PROGRESS (cont’d.)
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(ii) Property development in progress
Property development in progress comprises cost of land currently being developed together with
related development costs common to the whole project and direct building costs, and less
anticipated losses, if any. Development revenue and expenses are recognised in the income
statement when the financial outcome of the development activity can be reliably estimated. Where
the outcome cannot be reliably estimated, revenue is recognised to the extent that costs are
recoverable, and costs on properties sold are expensed in the period incurred. The excess or
shortfall of revenue over billings to purchasers is classified as accrued billings within trade
receivables or progress billings within trade payables respectively.
(j) REVENUE RECOGNITION
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group
and the revenue can be reliably measured.
Revenue from the sale of goods and services is recognised when the goods and services are delivered.
Revenue from property development and other long term contracts is recognised on the percentage of
completion method by reference to the percentage of actual construction work completed. Rental income
represents the invoiced value derived from the letting of properties, while finance charges from hire
purchase activities are recognised over the period of the hire purchase contracts in proportion to net
funds invested. Revenue from rental of hotel rooms, sale of food and beverage and other related income
are recognised on an accrual basis. Tuition fees are recognised on an accrual basis whereas nonrefundable
registration and enrolment fees are recognised when chargeable.
Dividends from Subsidiaries, Associates and other investee companies are recognised in the income
statements when the right to receive payment is established. Interest income is recognised as it accrues
unless collection is doubtful. Sales and other revenue earned from intra-group companies are eliminated
on consolidation, and the revenue of Associates is excluded from Group revenue.
(k) INCOME TAX
Income tax on the profit or loss for the year comprises current and deferred tax, and is recognised in
the income statement except to the extent that it relates to items recognised directly in equity, in which
case it is recognised in equity. Current tax is the expected amount of income taxes payable in respect
of the taxable profit for the year and is measured using the tax rates that have been enacted or
substantively enacted at the balance sheet date.
Deferred tax is provided for using the liability method, on temporary differences at the balance sheet date
between the tax bases of assets and liabilities and their carrying amounts in the financial statements. In
principle, deferred tax liabilities are recognised for all taxable temporary differences and deferred tax
assets are recognised for all deductible temporary differences, unused tax losses and unused tax credits
to the extent that it is probable that taxable profit will be available against which the deductible
temporary differences, unused tax losses and unused tax credits can be utilised.