FORGING AHEAD - Tradewinds Plantation Berhad

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FINANCIAL STATEMENTS
NOTES TO THE FINANCIAL STATEMENTS
31 DECEMBER 2010
4. SIGNIFICANT ACCOUNTING POLICIES (continued)
4.12 Impairment of financial assets (continued)
(b) Available-for-sale financial assets
The Group collectively considers factors such as significant or prolonged decline in fair value below cost,
significant financial difficulties of the issuer or obligor, and the disappearance of an active trading market as
objective evidence that available-for-sale financial assets are impaired.
If any such objective evidence exists, an amount comprising the difference between the financial asset’s cost (net
of any principal payment and amortisation) and current fair value, less any impairment loss previously recognised
in profit or loss, is transferred from equity to profit or loss.
Impairment losses on available-for-sale equity investments are not reversed in profit or loss in subsequent periods.
Instead, any increase in the fair value subsequent to the impairment loss is recognised in other comprehensive
income.
4.13 Borrowing costs
Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are
capitalised as part of the cost of the asset until when substantially all the activities necessary to prepare the asset for its
intended use or sale are complete, after which such expense is charged to profit or loss. A qualifying asset is an asset
that necessarily takes a substantial period of time to get ready for its intended use or sale. Capitalisation of borrowing
costs is suspended during extended periods in which active development is interrupted.
For plantation development expenditure, borrowing costs incurred on borrowings used to finance the development of
plantation, less any investment income on temporary investment on these borrowings are capitalised until such time the
trees are harvestable and to the extent appropriate.
All other borrowing costs are recognised in profit or loss in the period in which they are incurred.
4.14 Income taxes
Income taxes include all domestic and foreign taxes on taxable profit. Income taxes also include other taxes, such as
withholding taxes, which are payable by a foreign subsidiary or an associate on distributions to the Group and the
Company, and real property gains taxes payable on disposal of properties.
Taxes in statements of comprehensive income comprise current tax and deferred tax.
(a) Current tax
Current tax is the amount of income taxes payable or receivable in respect of the taxable profit or loss for a period.
Current tax for the current and prior periods is measured at the amount expected to be recovered from or payable
to the taxation authorities. The tax rates and tax laws used to compute the amount are those that have been
enacted or substantively enacted by the end of the reporting period.
TRADEWINDS PLANTATION BERHAD
Annual Report 2010