axiata group berhad | annual report 2015
142
NOTES TO THE
FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2015
3.
SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(s) Leases (continued)
Accounting by lessor (continued)
(ii) Operating leases
When assets are leased out under an operating lease, the asset is included in the statements of financial position based on the nature of
the asset. Lease income is recognised over the term for the lease on a straight-line basis.
(t) Income recognition
The Group’s operating revenue comprises the fair value of the consideration received or receivable for the sale of products and rendering of
services net of returns, duties, sales discounts and sales taxes paid, after eliminating sales within the Group. The Group’s and the Company’s
operating revenues are recognised or accrued at the time of the provision of the products or services.
(i) Mobile and interconnect services revenue
Revenue from mobile telephony services are recognised based on actual traffic volume, net of rebates or discounts.
Revenue from sales of prepaid starter packs and prepaid phone cards are deferred (as disclosed as deferred revenue in trade and other
payables) and recognised as revenue based on the actual use of the cards, net of taxes and discounts. Any amounts not recognised are
deferred, after which such amounts will be recognised as revenue.
Revenue from interconnection with other operators is recognised on the basis of actual recorded call traffic.
(ii) Lease of passive infrastructure
Income from lease of passive infrastructure is recognised on an accrual basis based on prices agreed with customers.
(iii) Interest income
Interest income is recognised on a time-proportion basis using the effective interest method. When a receivable is impaired, the Group
and the Company reduce the carrying amount to its recoverable amount, being the estimated future cash flow discounted at the original
effective interest rate of the instrument, and continues unwinding the discount as interest income. Interest income on impaired loans is
recognised using original effective interest rate.
(iv) Dividend income
Dividend income from investment in subsidiaries, joint ventures, associates and other investments is recognised when a right to receive
payment is established. This applies even if they are paid out of pre-acquisition profits. However, the investment may need to be tested for
impairment as a consequence.
(v) Technical and management services fees
Technical and management services fees comprise of fees for provision of support services to certain subsidiaries, which are recognised
on an accrual basis.
(vi) Other revenues
All other revenues are recognised net of rebates or discounts upon the rendering of services or sale of products, when the transfers of risks
and rewards have been completed.
