Foreign currency translation STRENGTHEN TECHNOLOGY AND INFRASTRUCTURE PLATFORM
NOTES TO THE FINANCIAL STATEMENTS
for the year ended 31 December 2011
the acquisition-date fair values of the assets transferred, the liabilities incurred and the equity interests issued. Acquisition-
related costs are expensed as incurred. Identifiable assets acquired, and liabilities and contingent liabilities assumed in a
business combination are measured initially at their fair value on the date of acquisition.
Refer to Note 2.10 for the Group’s accounting policy on “Goodwill on consolidation”.
Special purpose entities Entities in which the Group holds little or no equity are
consolidated as subsidiaries if the Group is assessed to have control over them. Such control can be demonstrated through
predetermination of the entities’ activities, exposure to and retention of majority of their residual or ownership risks, and
decision-making powers to obtain a majority of benefits from the entities.
Joint ventures Joint ventures are entities that are jointly controlled by the
Group together with one or more parties through contractual arrangements. The Group recognises its interests in joint
ventures using the proportionate consolidation method.
Proportionate consolidation involves combining the Group’s share of the joint venture’s income, expenses, assets and
liabilities on a line-by-line basis with similar items in the Group’s financial statements.
Associates Associates are entities over which the Group has significant
influence, but not control, and generally holds a shareholding of between and including 20 and 50 of the voting rights.
The Group recognises its investments in associates using the equity method of accounting.
Under the equity method of accounting, an investment in associate is initially carried at cost. The initial cost of an
acquisition is measured at the fair value of the assets given, equity instruments issued or liabilities assumed at the date of
acquisition, plus costs directly attributable to the acquisition. The carrying amount is increased or decreased to recognise the
Group’s share of net assets of the associate, less any impairment in value after the date of acquisition. Where the Group’s share
of losses in an associate equals or exceeds its interest in the associate, the Group does not recognise further losses, unless
it has incurred obligations or made payments on behalf of the associate.
The results of the associates are taken from the latest audited accounts or unaudited management accounts of the associates,
prepared at dates not more than three months prior to the end of the financial year of the Group. Adjustments are made for
the effects of significant transactions or events that occur between the two dates.
Investments in subsidiaries, associates and joint ventures Investments in subsidiaries, associates and joint ventures are
stated at cost less accumulated impairment losses in the balance sheet of the parentinvestorventurer. On disposal
of the investments, the difference between the net proceeds and the carrying amounts of the investments is taken to the
income statement.
Intra-group transactions All intra-group transactions, balances, income and expenses are
eliminated on consolidation. Profits resulting from transactions between the Group and its associates and joint ventures are
eliminated to the extent of the Group’s interests in these companies. Losses are also eliminated unless the transaction
provides evidence of an impairment of an asset transferred.
Alignment of accounting policies Where necessary, adjustments are made to the financial
statements of subsidiaries, associates and joint ventures to ensure consistency with the accounting policies adopted by
the Group.