Annual Report 2005 - Leeden Limited

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46Notes to the Financial Statements- 31 December 2005ACE DYNAMICS LIMITED2.27 Cash and cash equivalentsCash and cash equivalents comprise cash on hand and in banks and short-term deposits. Short-term deposits which are held tomaturity, are carried at cost. For the purpose of the statement of cash fl ows, cash and cash equivalents are shown net of outstandingbank overdrafts, which are repayable on demand and which form an integral part of the Group’s cash management.Cash and short term deposits carried in the balance sheets are classifi ed and accounted for as loans and receivables under FRS 39.The accounting policy for this category of fi nancial assets is stated in Note 2.16.2.28 Intangible assetsGoodwillGoodwill acquired in a business combination is initially measured at cost being the excess of the cost of the business combinationover the Group’s interest in the net fair value of the identifi able assets, liabilities and contingent liabilities. Following initial recognition,goodwill is measured at cost less any accumulated impairment losses. Goodwill is reviewed for impairment, annually or more frequentlyif events or changes in circumstances indicate that the carrying value may be impaired.For the purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated to eachof the Group’s cash-generating units, or groups of cash-generating units, that are expected to benefi t from the synergies of thecombination, irrespective of whether other assets or liabilities of the group are assigned to those units or groups of units. Each unitor group of units to which the goodwill is so allocated:• Represents the lowest level within the Group at which the goodwill is monitored for internal management purposes; and• Is not larger than a segment based on either the Group’s primary or the Group’s secondary reporting format.A cash-generating unit (or group of cash-generating units) to which goodwill has been allocated are tested for impairment annually andwhenever there is an indication that the unit may be impaired, by comparing the carrying amount of the unit, including the goodwill,with the recoverable amount of the unit. Where the recoverable amount of the cash-generating unit (or group of cash-generating units)is less than the carrying amount, an impairment loss is recognised.Where goodwill forms part of a cash-generating unit (or group of cash-generating units) and part of the operation within that unitis disposed of, the goodwill associated with the operation disposed of is included in the carrying amount of the operation whendetermining the gain or loss on disposal of the operation. Goodwill disposed of in this circumstance is measured based on the relativevalues of the operation disposed of and the portion of the cash-generating unit retained.Other intangible assetsIntangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets acquired in a businesscombination is their fair values as at the date of acquisition. Following initial recognition, intangible assets are carried at cost lessany accumulated amortisation and any accumulated impairment losses. The useful lives of intangible assets are assessed to be eitherfi nite or indefi nite. Intangible assets with fi nite lives are amortised on a straight-line basis over the estimated economic useful lives andassessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and theamortisation method for an intangible asset with a fi nite useful life are reviewed at least at each fi nancial year-end. The amortisationexpense on intangible assets with fi nite lives is recognised in the consolidated profi t and loss account.ANNUAL REPORT 2005Intangible assets with indefi nite useful lives are tested for impairment annually or more frequently if the events or changes incircumstances indicate that the carrying value may be impaired either individually or at the cash-generating unit level. Such intangiblesare not amortised. The useful life of an intangible asset with an indefi nite life is reviewed annually to determine whether the useful lifeassessment continues to be supportable.Distribution rightsDistribution rights acquired separately are measure on initial recognition at cost. Following initial recognition, these assets are carriedat cost less any accumulated amortisation and any accumulated imparment losses. The useful lives of intangible assets are assessedto be 3 years and are amortised on a straight-line basis. The amortisation period and the amortisation method for these assets witha fi nite useful life are reviewed at least at each fi nancial year-end.
47Notes to the Financial Statements- 31 December 20053. TurnoverGroup2005 2004$’000 $’000Sale of goods 51,409 38,918Sale of services 45 84Revenue recognised from development property 15,415 -Revenue from development property completed for sale 5,549 -Others 889 93373,307 39,935ACE DYNAMICS LIMITED4. Other income, profit /(loss) from operating activities and finance costsOther income, profi t/(loss) from operating activities and fi nance costs included the following :Other incomeInterest income 19 91Gain/(loss) on sale of property, plant and equipment 40 (94)Transport billing 61 104Rental of machineries 964 –Profit/(loss) from operating activities is stated after charging / (crediting) the following:Depreciation of property, plant and equipment 2,104 1,267Salaries and related costs 6,223 4,858Defi ned contributions schemes 801 560Allowance for stock obsolescence 54 412Allowance for doubtful debts (trade) 130 675Foreign currency exchange gains- realised (786) (454)- unrealised (64) (202)Expense of share-based payments 202 101Allowance for doubtful debts of an associated company – 3,113Provision for foreseeable losses of development property – 1,592Impairment loss of :- other investments (quoted) – 140- club membership – 11- investment property 80 –Allowance for other debtor – 554Compensation paid to a director for loss of offi ce for the Group – 59Loss / (gain) on disposal of an associated company 20 (574)Loss on return of investment arising from reduction of share capitalof an associated company – 882Gain on disposal of a subsidiary company (47) –Fair value change of assets held at fair value through profi t and loss 62 –Allowance for loss on development property completed for sale 512 –There are no non-audit fees paid to the auditors of the Company during the fi nancial year.ANNUAL REPORT 2005
Page 2 and 3: 2ACE DYNAMICS LIMITED1 Mission, Vis
Page 4: 2ACE DYNAMICS LIMITEDMessage fromCh
Page 7 and 8: 5ACE DYNAMICS LIMITEDFinance cost w
Page 9 and 10: 7ACE DYNAMICS LIMITEDby 11% to $9.3
Page 11 and 12: 9Mr Tony Chan was appointed as a No
Page 13 and 14: Corporate Governance Report11Ace Dy
Page 15 and 16: Corporate Governance Report13BOARD
Page 17 and 18: Corporate Governance Report15Princi
Page 19 and 20: 17Report of the DirectorsThe Direct
Page 21 and 22: 19Report of the DirectorsDirectors
Page 23 and 24: Statement by Directors Pursuant to
Page 25 and 26: Consolidated Profit and Loss Accoun
Page 27 and 28: Statements of Changes in Equityfor
Page 29 and 30: Consolidated Statement of Cash Flow
Page 31 and 32: Notes to the Financial Statements-
Page 47: Notes to the Financial Statements-
Page 51 and 52: 49Notes to the Financial Statements
Page 69 and 70: Shareholding StatisticsAs at 20 Mar
Page 71 and 72: 69ACE DYNAMICS LIMITED(Company Regi
Page 73 and 74: ACE DYNAMICS LIMITED[Company Regist
Page 75: ACE DYNAMICS LIMITED1 Shipyard Road

Annual Report 2005 - Leeden Limited

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