3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
3.3 Investment properties (continued)
Fair value changes are recognised in the Statement of Total Return. When an investment property is
disposed of, the resulting gain or loss is recognised in the Statement of Total Return as the difference
between net disposal proceeds and the carrying amount of the property.
Subsequent expenditure relating to investment properties that have already been recognised is added to
the carrying amount of the assets when it is probable that future economic benefits, in excess of originally
assessed standard of performance of the existing asset, will flow to the Group. All other subsequent
expenditure is recognised as an expense in the period in which it is incurred.
Investment properties are not depreciated. The properties are subject to continuing maintenance and
are regularly revalued on the basis described above. For taxation purpose, the Group may claim capital
allowances on assets that qualify as plant and machinery under the Income Tax Act.
3.4 Intangible assets
Intangible assets represent the unamortised income support receivable by the Group in accordance
with the purchase agreement entered into with the vendors of 9 Tai Seng Drive and 6 Woodlands Loop.
These intangible assets have finite useful lives and are measured at cost less accumulated amortisation
and accumulated impairment losses.
These intangible assets are amortised in the Statement of Total Return on a systematic basis over their
estimated useful lives of 3 years to 5 years. Intangible assets are tested for impairment as described in
Note 3.6.
3.5 Financial instruments
(i) Non-derivative financial assets
The Group initially recognises loans and receivables on the date that they are originated. All other
financial assets are recognised initially on the trade date, which is the date that the Group becomes a
party to the contractual provisions of the instrument.
The Group derecognises a financial asset when the contractual rights to the cash flows from the asset
expire, or it transfers the rights to receive the contractual cash flows on the financial asset in a transaction
in which substantially all the risks and rewards of ownership of the financial asset are transferred,
or it neither transfers nor retains substantially all of the risks and rewards of ownership and does not
retain control over the transferred asset. Any interest in transferred financial assets that is created or
retained by the Group is recognised as a separate asset or liability.
Financial assets and liabilities are offset and the net amount presented in the Statement of Financial
Position when, and only when, the Group has a legal right to offset the amounts and intends either to
settle on a net basis or to realise the asset and settle the liability simultaneously.
The Group has the following non-derivative financial assets: loans and receivables.
Year ended 31 December 2014
NOTES TO THE FINANCIAL STATEMENTS
SABANA REIT
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ANNUAL REPORT 2014
106
