NOTES TO THE FINANCIAL STATEMENTS
For The Financial Period From 1 January 2014 To 31 March 2015 (Cont’d)
72
Annual Report 2015
4.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
4.9 RESEARCH AND DEVELOPMENT EXPENDITURES
Research expenditure is recognised as an expense when it is incurred.
Development expenditures are recognised as expense except that expenditures incurred on
development projects are capitalised as non-current assets to the extent that such expenditures
are expected to generate future economic benefits. Development expenditures are capitalised
if, and only if an entity can demonstrate all of the following:-
(a) its ability tomeasure reliably the expenditures attributable to the asset under development;
(b) the product or process is technically and commercially feasible;
(c) its future economic benefits are probable;
(d) its intention to complete and the ability to use or sell the developed asset; and
(e) the availability of adequate technical, financial and other resources to complete the
asset under development.
Capitalised development expenditures are measured at cost less accumulated amortisation
and impairment losses, if any. Development expenditures initially recognised as expenses are
not recognised as assets in the subsequent period.
The development expenditures are amortised on a unit of production method over the life of
the project when the products are ready for sale or use. In the event that the expected future
economic benefits are no longer probable of being recovered, the development expenditures
are written down to its recoverable amount.
4.10 IMPAIRMENT
(a) Impairment of Financial Assets
All financial assets (other than those categorised at fair value through profit or loss), are
assessed at the end of each financial year whether there is any objective evidence of
impairment as a result of one or more events having an impact on the estimated future
cash flows of the asset. For an equity instrument, a significant or prolonged decline in the
fair value below its cost is considered to be objective evidence of impairment.
An impairment loss in respect of held-to-maturity investments and loans and receivables
financial assets is recognised in profit or loss and is measured as the difference between the
asset’s carrying amount and the present value of estimated future cash flows, discounted
at the financial asset’s original effective interest rate.
An impairment loss in respect of available-for-sale financial assets is recognised in
profit or loss and is measured as the difference between its cost (net of any principal
payment and amortisation) and its current fair value, less any impairment loss previously
recognised. In addition, the cumulative loss recognised in other comprehensive income
and accumulated in equity under fair value reserve, is reclassified from equity to profit or
loss.
With the exception of available-for-sale equity instruments, if, in a subsequent period, the
amount of the impairment loss decreases and the decrease can be related objectively
to an event occurring after the impairment was recognised, the previously recognised
impairment loss is reversed through profit or loss to the extent that the carrying amount
financial asset at the date the impairment is reversed does not exceed what the amortised
cost would have been had the impairment not been recognised. In respect of available-
for-sale equity instruments, impairment losses previously recognised in profit or loss are not
reversed through profit or loss. Any increase in fair value subsequent to an impairment loss
made is recognised in other comprehensive income.
