NOTES TO THE FINANCIAL STATEMENTS
3 Significant accounting policies (Cont’d)
3.5 Financial instruments (Cont’d)
Impairment of financial assets (Cont’d)
Impairment losses in respect of financial assets measured at amortised cost are reversed to the Statement
of Total Return, if the subsequent increase in fair value can be related objectively to an event occurring
after the impairment loss was recognised.
3.6 Impairment – non-financial assets
The carrying amounts of the Group’s non-financial assets, other than investment properties and
investment properties under development, are reviewed at each reporting date to determine whether
there is any indication of impairment. If any such indication exists, the asset’s recoverable amount is
estimated.
For the purpose of impairment testing, assets that cannot be tested individually are grouped together into
the smallest group of assets that generates cash inflows from continuing use that are largely independent
of the cash inflows of other assets or groups of assets (the “cash-generating unit”, or “CGU”).
The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to
sell. In assessing value in use, the estimated future cash flows are discounted to their present value using
a pre-tax discount rate that reflects current market assessments of the time value of money and the risks
specific to the asset.
An impairment loss is recognised if the carrying amount of an asset or its CGU exceeds its estimated
recoverable amount. Impairment losses are recognised in the statement of total return.
Impairment losses recognised in prior years are assessed at each reporting date for any indications that
the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change
in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the
extent that the asset’s carrying amount does not exceed the carrying amount that would have been
determined, net of depreciation or amortisation, if no impairment loss had been recognised.
3.7 Revenue recognition
(i)
Rental income from operating leases
Rental income from investment property is recognised in the Statement of Total Return on a
straight-line basis over the term of the lease. Lease incentives granted are recognised as an
integral part of the total rental income over the term of the lease.
(ii)
Interest income
Interest income is accrued using the effective interest method.
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