Page 102 - ar2013.pdf

NOTES TO THE FINANCIAL STATEMENTS
For the Ànancial year ended 31 December 2013
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COSCO Corporation (Singapore) Limited
F i nanc i a l Statement s
2. Significant accounting policies (continued)
2.21 Employee compensation (continued)
(b) Employee leave entitlements
Employee entitlements to annual leave are recognised when they accrue to employees. A provision is made
for the estimated liability for annual leave as a result of services rendered by employees up to the balance
sheet date.
(c) Share-based compensation
The Group operates an equity-settled, share-based compensation plan. The value of the employee services
received in exchange for the grant of the options is recognised as an expense with a corresponding
increase in the share option reserve over the vesting period. The total amount to be recognised over the
vesting period is determined by reference to the fair value of the options granted on the date of the grant.
Non-market vesting conditions are included in the estimation of the number of shares under option that
are expected to become exercisable on the vesting date. At each balance sheet date, the Group revises
its estimates of the number of shares under options that are expected to become exercisable on the
vesting date and recognises the impact of the revision of the estimates in the income statement, with a
corresponding adjustment to the share option reserve over the remaining vesting period.
When the options are exercised, the proceeds received (net of transaction costs) are credited to share capital
account when new ordinary shares are issued.
2.22 Currency translation
(a) Functional and presentation currency
Items included in the financial statements of each entity in the Group are measured using the currency of the
primary economic environment in which the entity operates (“functional currency”). The financial statements
are presented in Singapore Dollars, which is the functional currency of the Company.
(b) Transactions and balances
Transactions in a currency other than the functional currency (“foreign currency”) are translated into
the functional currency using the exchange rates at the dates of the transactions. Currency translation
differences resulting from the settlement of such transactions and from the translation of monetary assets
and liabilities denominated in foreign currencies at the closing rates at the balance sheet date are recognised
in the income statement. However, in the consolidated financial statements, currency translation differences
arising from borrowings in foreign currencies and other currency instruments designated and qualifying as net
investment hedges and net investment in foreign operations, are recognised in other comprehensive income
and accumulated in the currency translation reserve.
When a foreign operation is disposed of or any borrowings forming part of the net investment of the foreign
operation are repaid, a proportionate share of the accumulated translation differences is reclassified to the
income statement, as part of the gain or loss on disposal.
Foreign exchange gains and losses that impact the income statement are presented in the income statement
within “other income (net)”.
Non-monetary items measured at fair values in foreign currencies are translated using the exchange rates at
the date when the fair values are determined.