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JUMBO GROUP LIMITED
Notes to the Combined
Financial Statements
As at 30 September 2015
2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)
Any excess of the cost of acquisition over the Group’s share of the net fair value of the identifiable assets, liabilities and contingent
liabilities of the associate recognised at the date of acquisition is recognised as goodwill. The goodwill is included within the carrying
amount of the investment and is assessed for impairment as part of the investment. Any excess of the Group’s share of the net
fair value of the identifiable assets, liabilities and contingent liabilities over the cost of acquisition, after reassessment, is recognised
immediately in profit or loss.
Where a Group entity transacts with an associate of the Group, profits or losses are eliminated to the extent of the Group’s interest in the
relevant associate.
PROVISIONS - Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is
probable that the Group will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the
financial year, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash
flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows.
When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, the receivable
is recognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured
reliably.
Provision for reinstatement costs
The Group recognises a liability and capitalise an expense in property, plant and equipment if the Group has a present legal or
constructive obligation to reinstate the leased premises to their original state upon expiry of the lease. The provision is made based on
management’s best estimate of the expected costs to be incurred to reinstate the leased premises to their original state. The capitalised
provision for reinstatement costs in plant and equipment is amortised over the period of the lease.
GOVERNMENT GRANTS - Government grants are not recognised until there is reasonable assurance that the Group will comply with
the conditions attaching to them and the grants will be received. Government grants whose primary condition is that the Group should
purchase, construct or otherwise acquire non-current assets are recognised as deferred income in the statement of financial position and
transferred to profit or loss on a systematic and rational basis over the useful lives of the related assets.
Other government grants are recognised as income over the periods necessary to match them with the costs for which they are intended
to compensate, on a systematic basis. Government grants that are receivable as compensation for expenses or losses already incurred
or for the purpose of giving immediate financial support to the Group with no future related costs are recognised in profit or loss in the
period in which they become receivable.
REVENUE RECOGNITION - Revenue is measured at the fair value of the consideration received or receivable and represents amounts
receivable for goods and services provided in the normal course of business, net of discounts and sales related taxes. Considerations
received in advance are deferred until the goods and services are provided.
Sale of food and beverages
Revenue from the sale of food and beverages is recognised when all the following conditions are satisfied:
the Group has transferred to the buyer the significant risks and rewards of ownership of the food and beverages i.e. when the
food and beverages are delivered;
the amount of revenue can be measured reliably;
it is probable that the economic benefits associated with the transaction will flow to the Group; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Interest income
Interest income is accrued on a time proportionate basis, by reference to the principal outstanding and at the effective interest rate
applicable.
