NOTES TO THE FINANCIAL STATEMENTS
For the financial year ended 31 December 2014
Financial Statements
88
COSCO Corporation (Singapore) Limited
2.
Significant accounting policies
(continued)
2.3
Group accounting (continued)
(a)
Subsidiaries
(continued)
(iii)
Disposals
When a change in the Group’s ownership interest in a subsidiary results in a loss of control
over the subsidiary, the assets and liabilities of the subsidiary including any goodwill are
derecognised. Amounts previously recognised in other comprehensive income in respect of
that entity are also reclassified to profit or loss or transferred directly to retained earnings if
required by a specific Standard.
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 profit or loss.
Please refer to Note 2.9 “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 associated company 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 profit or loss 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 to or exceeds its interest in the associated company,
the Group does not recognise further losses, unless it has legal or constructive obligations
to make, or has made, payments on behalf of the associated company. If the associated
company subsequently reports profits, the Group resumes recognising its share of those
profits only after its share of the profits equals the share of losses not recognised.
