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NOTES TO THE FINANCIAL STATEMENTS
For the Ànancial year ended 31 December 2013
88
COSCO Corporation (Singapore) Limited
F i nanc i a l Statement s
2. Significant accounting policies (continued)
2.3 Group accounting (continued)
(a) Subsidiaries (continued)
(iii) Disposals (continued)
Any retained equity interest in the entity is remeasured at fair value. The difference between the
carrying amount of the retained interest at the date when control is lost and its fair value is recognised
in the income statement.
Please refer to the paragraph “Investments in subsidiaries and associated companies” for the
accounting policy on investments in subsidiaries in the separate financial statements of the Company.
(b) Transactions with non-controlling interests
Changes in the Group’s ownership interest in a subsidiary that do not result in a loss of control over the
subsidiary are accounted for as transactions with equity owners of the Company. Any difference between the
change in the carrying amounts of the non-controlling interest and the fair value of the consideration paid or
received is recognised within equity attributable to the equity holders of the Company.
(c) Associated companies
Associated companies are entities over which the Group has significant influence, but not control, generally
accompanied by a shareholding giving rise to voting rights of 20% and above but not exceeding 50%.
Investments in associated companies are accounted for in the consolidated financial statements using the
equity method of accounting less impairment losses, if any.
(i) Acquisitions
Investments in associated companies are initially recognised at cost. The cost of an acquisition
is measured at the fair value of the assets given, equity instruments issued or liabilities incurred or
assumed at the date of exchange, plus costs directly attributable to the acquisition. Goodwill on
associated companies represents the excess of the cost of acquisition of the associate over the
Group’s share of the fair value of the identifiable net assets of the associate and is included in the
carrying amount of the investments.
(ii) Equity method of accounting
In applying the equity method of accounting, the Group’s share of its associated companies’ post-
acquisition profits or losses are recognised in the income statement and its share of post-acquisition
other comprehensive income is recognised in other comprehensive income. These post-acquisition
movements and distributions received from the associated companies are adjusted against the
carrying amount of the investments. When the Group’s share of losses in an associated company
equals or exceeds its interest in the associated company, including any other unsecured non-current
receivables, the Group does not recognise further losses, unless it has obligations to make or has
made payments on behalf of the associated company.
Unrealised gains on transactions between the Group and its associated companies are eliminated to
the extent of the Group’s interest in the associated companies. Unrealised losses are also eliminated
unless the transaction provides evidence of an impairment of the asset transferred. The accounting
policies of associated companies have been changed where necessary to ensure consistency with
the accounting policies adopted by the Group.