57
Annual Report 2015
TEHO INTERNATIONAL INC LTD.
3 SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.16 Tax (cont’d)
A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary
differences, to the extent that it is probable that future taxable profits will be available against
which they can be utilised. Deferred tax assets are reviewed at each reporting date and are
reduced to the extent that it is no longer probable that the related tax benefit will be realised.
In determining the amount of current and deferred tax, the Group takes into account
the impact of uncertain tax positions and whether additional taxes and interest may be
due. The Group believes that its accruals for tax liabilities are adequate for all open tax
years based on its assessment of many factors, including interpretations of tax law and
prior experience. This assessment relies on estimates and assumptions and may involve
a series of judgements about future events. New information may become available that
causes the Group to change its judgement regarding the adequacy of existing tax liabilities;
such changes to tax liabilities will impact tax expense in the period that such a determination
is made.
3.17 Earnings per share
The Group presents basic and diluted earnings per share data for its ordinary shares.
Basic earnings per share is calculated by dividing the profit or loss attributable to ordinary
shareholders of the Company by the weighted-average number of ordinary shares
outstanding during the year, adjusted for own shares held. Diluted earnings per share is
determined by adjusting the profit or loss attributable to ordinary shareholders and the
weighted-average number of ordinary shares outstanding, adjusted for own shares held, for
the effects of all dilutive potential ordinary shares.
3.18 Segment reporting
An operating segment is a component of the Group that engages in business activities from
which it may earn revenues and incur expenses, including revenues and expenses that
relate to transactions with any of the Group’s other components. All operating segments’
operating results are reviewed regularly by the Group’s CEO (the chief operating decision
maker) to make decisions about resources to be allocated to the segment and to assess
its performance, and for which discrete financial information is available.
3 SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.18 Segment reporting (cont’d)
Segment results that are reported to the Group’s CEO include items directly attributable to a
segment as well as those that can be allocated on a reasonable basis. Unallocated items comprise
mainly corporate assets (primarily the Company’s headquarters), and head office expenses.
Segment capital expenditure is the total cost incurred during the year to acquire property,
plant and equipment, and intangible assets other than goodwill.
3.19 New standards and interpretations not adopted
A number of new standards, amendments to standards and interpretations are effective for
annual periods beginning after 1 July 2015, and have not been applied in preparing these
financial statements. The Group is currently assessing the potential impact of adopting
these new standards and interpretations, on the financial statements of the Group and the
Company.
These new standards include, among others, FRS 115
Revenue from Contracts with
Customers
and FRS 109
Financial Instruments
which are mandatory for adoption by the
Group on 1 July 2017 and 1 July 2018 respectively.
• FRS 115 establishes a comprehensive framework for determining whether, how
much and when revenue is recognised. It also introduces new cost guidance which
requires certain costs of obtaining and fulfilling contracts to be recognised as separate
assets when specified criteria are met. When effective, FRS 115 replaces existing
revenue recognition guidance, including FRS 18
Revenue
, FRS 11
Construction
Contracts
, INT FRS 113
Customer Loyalty Programmes
, INT FRS 115
Agreements
for the Construction of Real Estate,
INT FRS 118
Transfers of Assets from Customers
and INT FRS 31
Revenue – Barter Transactions Involving Advertising Services
.
• FRS 109 replaces most of the existing guidance in FRS 39
Financial Instruments:
Recognition and Measurement.
It includes revised guidance on classification and
measurement of financial instruments, a new expected credit loss model for calculating
impairment on financial assets, and new general hedge accounting requirements.
As FRS 115 and FRS 109, when effective, will change the existing accounting standards
and guidance applied by the Group and the Company in accounting for revenue and
financial instruments, these standards are expected to be relevant to the Group and the
Company. The Group does not plan to adopt these standards early.
NOTES TO THE
FINANCIAL STATEMENTS
Year ended 30 June 2015
