Summary of Significant Accounting Policies
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(g) Investment Properties
- Revaluation surpluses arising on annual valuations of the Group’s investment properties are credited direct to capital
reserves. Revaluation deficits are taken to the profit and loss account in the absence of or to the extent that they exceed
any surpluses held in reserves relating to previous revaluations.
- Profits or losses on disposal of all investment properties are included in the profit and loss account. Any surpluses held in
capital reserves in respect of previous revaluations of investment properties disposed of during the year are regarded as
having become realised and are transferred to the profit and loss account.
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(h) Properties Held for Development
- Properties held for development are stated at cost less impairment losses. Cost includes cost of land and construction,
related overhead expenditure and financing charges and other net costs incurred during the period of development.
They are considered completed and are transferred to investment properties or fixed assets when they are ready for their
intended use as defined in SAS 19.
- Each property under development is accounted for as a separate project. Where a project comprises more than one
component, each component is treated as a separate project, and interest and other net costs are apportioned
accordingly.
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(i) Properties Held for Sale
- Development properties held for sale are stated at the lower of cost and net realisable value. Cost includes cost of land
and construction, related overhead expenditure and financing charges and other net costs incurred during the period of
development. Upon receipt of temporary occupation permits, they are transferred to completed properties held for sale.
- Profit recognised on partly completed projects which are held for sale is based on the percentage of completion method.
The profit recognition upon the signing of sales contracts for Singapore trading properties under development is 20% of
the total estimated profit attributable to the actual contracts signed. Subsequent recognition of profit is based on the
stage of development completion.
- When losses are expected, full provision is made in the accounts after adequate allowance has been made for estimated
costs to completion. Any expenditure incurred on abortive projects is written off in the profit and loss account for the
year.
- Profit on partly completed projects which are held for sale less any provision to reduce cost to estimated realisable value
as well as the profit or loss on sale of completed properties are included in the operating results for the year.
- Completed properties held for sale are stated at the lower of cost and net realisable value. Cost includes cost of land and
construction, and interest incurred during the period of construction.
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