Straco Corporation Limited • Annual Report 2014
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NOTES TO THE FINANCIAL STATEMENTS
3
Significant accounting policies (cont’d)
3.13 Income tax (cont’d)
Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, and they relate to income
taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets
on a net basis or their tax assets and liabilities will be realised simultaneously.
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.
3.14 Leases payments
Payments made under operating leases are recognised in profit or loss on a straight-line basis over the term of the lease. Lease incentives received are
recognised as an integral part of the total lease expense, over the term of the lease. Contingent rentals are charged to the income statement in the
accounting period in which they are incurred.
3.15 Earnings per share
The Group presents basic and diluted earnings per share (“EPS”) data for its ordinary shares. Basic EPS 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 period, adjusted
for own shares held. 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, which comprise share options
granted to employees.
3.16 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 Executive Chairman (“EC”) to make decisions about resources to be allocated to the segment and assess its performance, and
for which discrete financial information is available.
Segment results that are reported to the EC 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), head office expenses, and income tax assets and liabilities.
Segment capital expenditure is the total cost incurred during the year to acquire property, plant and equipment, and intangible assets other than goodwill.
3.17 New accounting standards and interpretations not adopted
A number of new standards, amendments to standards and interpretations are effective for annual periods beginning after 1 January 2014 and have
not been applied in preparing these consolidated financial statements. None of these are expected to have a significant effect on the consolidated
financial statements of the Group.
