Annual Report 2016
87
2. Significant accounting policies (Cont’d)
(r) Earnings per ordinary share (Cont’d)
Diluted EPS 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.
(s) Operating segments
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 chief operating decision
maker, which in this case is the Managing Director of the Group, to make decisions about resources to be allocated
to the segment and to assess its performance, and for which discrete financial information is available.
(t) Contingencies
(i) Contingent liabilities
Where it is not probable that an outflow of economic benefits will be required, or the amount cannot be
estimated reliably, the obligation is not recognised in the statements of financial position and is disclosed as a
contingent liability, unless the probability of outflow of economic benefits is remote. Possible obligations, whose
existence will only be confirmed by the occurrence or non-occurrence of one or more future events, are also
disclosed as contingent liabilities unless the probability of outflow of economic benefits is remote.
(ii) Contingent assets
When an inflow of economic benefit of an asset is probable where it arises from past events and where
existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events
not wholly within the control of the entity, the asset is not recognised in the statements of financial position but
is being disclosed as a contingent asset. When the inflow of economic benefit is virtually certain, then the
related asset is recognised.
(u) Fair value measurements
Fair value of an asset or a liability is determined as the price that would be received to sell an asset or paid to
transfer a liability in an orderly transaction between market participants at the measurement date. The measurement
assumes that the transaction to sell the asset or transfer the liability takes place either in the principal market or in
the absence of a principal market, in the most advantageous market.
For non-financial asset, the fair value measurement takes into account a market participant’s ability to generate
economic benefits by using the asset in its highest and best use or by selling it to another market participant that
would use the asset in its highest and best use.
When measuring the fair value of an asset or a liability, the Group uses observable market data as far as possible.
Fair value are categorised into different levels in a fair value hierarchy based on the input used in the valuation
technique as follows:
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities that the Group can
access at the measurement date.
Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability,
either directly or indirectly.
Level 3: unobservable inputs for the asset or liability.
The Group recognises transfers between levels of the fair value hierarchy as of the date of the event or change in
circumstances that caused the transfers.
Notes to the Financial Statements
(Cont’d.)
