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Axiata Group Berhad | Annual Report 2016
FINANCIAL STATEMENTS
150
NOTES TO THE FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2016
3.
SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(w) Foreign currencies (continued)
(iii) Group companies (Consolidated financial statements)
The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have a
functional currency different from the presentation currency are translated into the presentation currency as follows:
•
assets and liabilities for each statement of financial position presented are translated at the closing rate at the date of that
statements of financial position;
•
income and expenses for each statements of comprehensive income are translated at average exchange rates (unless this average
is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income
and expenses are translated at the rate on the dates of the transactions); and
•
all resulting exchange differences are recognised as a separate component of OCI.
Goodwill and fair value adjustments arising on the acquisitions of a foreign entity are treated as assets and liabilities of the foreign entity
and translated at the closing rate. Exchange differences arising are recognised in OCI.
On consolidation, exchange differences arising from the translation of any net investment in foreign entities, and of borrowings and other
financial instruments designated as hedges of such investments, are recognised in OCI.
On the disposal of a foreign operation (that is, a disposal of the Group’s entire interest in a foreign operation, or a disposal involving loss
of control over a subsidiary that includes a foreign operation, a disposal involving loss of joint control over a joint venture that includes
a foreign operation, or a disposal involving loss of significant influence over an associate that includes a foreign operation), all of the
exchange differences relating to that foreign operation recognised in consolidated OCI and accumulated in the separate component of
equity are reclassified to consolidated profit or loss. In the case of a partial disposal that does not result in the Group losing control over
a subsidiary that includes a foreign operation, the proportionate share of accumulated exchange differences are re-attributed to NCIs
and are not recognised in consolidated profit or loss. For all other partial disposals (that is, reductions in the Group’s ownership interest
in associates or joint ventures that do not result in the Group losing significant influence or joint control) the proportionate share of the
accumulated exchange difference is reclassified to profit or loss.
(x) Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision maker. The
Chief Operating Decision maker, who is responsible for allocating resources and assessing performance of the operating segments, has been
identified as the Board of Directors that makes strategic decisions.
(y) Government grants
As a Universal Service Provider (“USP”), the Group is entitled to claim certain qualified expenses from the relevant authorities in relation to
USP projects. The claim qualifies as a government grant and is recognised at fair value where there is a reasonable assurance that the grant
will be received and the Group will comply with all attached conditions.
Government grants relating to costs are recognised in the profit of loss over the period necessary to match them with the costs they are
intended to compensate.
Government grants relating to the purchase of assets are included in non-current liabilities as deferred income and are credited to the profit
or loss on the straight line basis over the expected life of the related assets.