SAILING THE SEAS OF SUCCESS - Swissco Holdings Limited

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NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2004 3. Significant accounting policies (continued) (d) Property, plant and equipment All property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses. Depreciation of property, plant and equipment is calculated on a straight-line basis to write off the cost of the property, plant and equipment over their expected useful lives. The estimated useful lives are as follows: Vessels/barges Leasehold buildings Motor vehicles Furniture, fittings and computers Plant and equipment 15 years the shorter of 50 years or the lease term 5 years 3 – 10 years 5 years No depreciation is provided on vessels-in-construction. Subsequent expenditure relating to property, plant and equipment that has already been recognised is added to the carrying amount of the asset when it is probable that future economic benefits, in excess of the originally assessed standard of performance of the existing asset, will flow to the Group and the cost can be reliably measured. Other subsequent expenditure is recognised as an expense during the financial year in which it is incurred. Where an indication of impairment exists, the carrying amount of the asset is assessed and written down immediately to its recoverable amount. Gains and losses on disposals are determined by comparing proceeds with carrying amounts and are taken to the income statement. (e) Investments Investments in subsidiaries and associated companies are stated at cost less impairment losses in the Company’s balance sheet. Where an indication of impairment exists, the carrying amount of the investment is assessed and written down immediately to its recoverable amount. Investments in other non-current investments, are stated at cost and an allowance for diminution is made where, in the opinion of the directors, there is a decline other than temporary in the value of such investments. Where there has been a decline other than temporary in the value of an investment, such a decline is recognised as an expense in the period in which the decline is identified. On disposal of an investment, including subsidiaries and associated companies, the difference between net disposal proceeds and its carrying amount is taken to the income statement. (f) Trade receivables Trade receivables are stated at original invoice amount less allowance made for doubtful receivables based on a review of all outstanding amounts at the balance sheet date. An allowance for doubtful receivables is made when there is objective evidence that the Group will not be able to collect amounts due according to original terms of receivables. Bad debts are written off when identified. SWISSCO INTERNATIONAL LIMITED_32
NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2004 3. Significant accounting policies (continued) (g) Accounting for leases Finance leases Leases of assets in which the Group assumes substantially the risks and rewards of ownership are classified as finance leases. Finance leases are capitalised at the inception of the lease at the lower of the fair value of the leased asset and the present value of the minimum lease payments. Each lease payment is allocated between the liability and finance charge so as to achieve a constant rate on the finance balance outstanding. The corresponding rental obligations, net of finance charges, are included in borrowings. The interest element of the finance cost is taken to the income statement over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. Operating leases Leases of assets in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are taken to the income statement on a straight-line basis over the period of the lease. When an operating lease is terminated before the lease period has expired, any payment required to be made to the lessor by way of penalty is recognised as an expense in the period in which termination takes place. (h) Inventories Inventories are stated at the lower of cost and net realisable value. Cost is determined by the first-in, first-out basis. Net realisable value is the estimated selling price in the ordinary course of business, less the costs of completion and selling expenses. (i) Deferred income taxes Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. However, if the deferred income tax arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss, it is not accounted for. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled. Deferred tax assets are recognised to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised. Deferred income tax is provided on temporary differences arising on investments in subsidiaries and associated companies, except where the timing of the reversal of the temporary difference can be controlled and it is probable that the temporary difference will not reverse in the foreseeable future. (j) Provisions Provisions are recognised when the Group has a legal or constructive obligation as a result of past events that it is probable an outflow of resources will be required to settle the obligation, and a reliable estimate of the amount of the obligation can be made. (k) Trade and other payables Trade and other payables are stated in the balance sheet at cost. (l) Borrowings Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption value is taken to the income statement over the period of the borrowings using the effective interest method. ANNUAL REPORT 2004_33
Page 1 and 2: SWISSCO SAILING THE SEAS OF SUCCESS
Page 3 and 4: GROUP STRUCTURE 100% 100% Swissc
Page 5 and 6: CHAIRMAN’S STATEMENT “Our Group
Page 7 and 8: CORPORATE PROFILE Out Port Limit (O
Page 9 and 10: OUR HISTORY our business to support
Page 11 and 12: BOARD OF DIRECTORS Mr Yeo Chong Lin
Page 13 and 14: CORPORATE INFORMATION BOARD OF DIRE
Page 15 and 16: OPERATIONS REVIEW Our Group’s two
Page 17 and 18: our vessels OUT PORT LIMIT (OPL) BO
Page 19 and 20: CORPORATE GOVERNANCE REPORT Swissco
Page 21 and 22: CORPORATE GOVERNANCE REPORT Interna
Page 23 and 24: DIRECTORS’ REPORT Directors’ co
Page 25 and 26: STATEMENT BY DIRECTORS In the opini
Page 27 and 28: CONSOLIDATED INCOME STATEMENT FOR T
Page 29 and 30: CONSOLIDATED STATEMENT OF CHANGES I
Page 31 and 32: NOTES TO THE FINANCIAL STATEMENTS F
Page 33: NOTES TO THE FINANCIAL STATEMENTS F
Page 55 and 56: STATISTICS OF SHAREHOLDINGS AS AT 1
Page 57 and 58: NOTICE OF FIRST ANNUAL GENERAL MEET
Page 59 and 60: NOTICE OF FIRST ANNUAL GENERAL MEET
Page 61 and 62: SWISSCO INTERNATIONAL LIMITED (Inco
Page 63: SWISSCO Swissco International Limit

SAILING THE SEAS OF SUCCESS - Swissco Holdings Limited

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