132 | CapitaLand Limited Annual Report 2014
Appendix
Notes to the Financial Statements
Year ended 31 December 2014
2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(cont’d)
2.17 Tax
(cont’d)
The measurement of deferred taxes renects the tax consequences that would follow the manner in which the
Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and
liabilities. Deferred tax is measured at the tax rates that are expected to be applied to temporary differences
when they reverse, based on the laws that have been enacted or substantively enacted by the reporting date.
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 to the extent that it is probable that future taxable promts will be available
against which temporary differences 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 benemt 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.
2.18 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 promt or loss attributable to owners 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 promt or loss attributable to owners of the Company 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 issued convertible bonds and share plans granted to employees.
2.19 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. Operating segments are reported in a manner consistent with the internal
reporting provided to the chief operating decision-maker. The chief operating decision-maker has been
identimed as the Executive Management Council that makes strategic resource allocation decisions. The
Council comprises the President & Group Chief Executive Ofmcer (CEO), all CEOs of business units and key
management ofmcers of the Corporate Ofmce.
2.20 Discontinued operation
A discontinued operation is a component of the Group’s business, the operations and cash nows of which
can be clearly distinguished from the rest of the Group and which
t represents a separate major line of business or geographical area of operations;
t is part of a single co-ordinated plan to dispose of a separate major line of business or geographical
area of operations; or
t is a subsidiary acquired exclusively with a view to resale.
Classimcation as a discontinued operation occurs upon disposal or when the operation meets the criteria
to be classimed as held for sale, if earlier. When an operation is classimed as a discontinued operation, the
comparative statement of promt or loss is re-presented as if operation had been discontinued from the start
of the comparative year.
