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CapitaLand Mall Trust
Annual Report 2015
3 Significant accounting policies
(continued)
3.1 Consolidation
(continued)
Associate and joint ventures
Associate is an entity in which the Group has a significant influence, but not control, over the financial and
operating policies. A joint venture is an arrangement in which the Group has joint control, whereby the Group
has rights to the net assets of the arrangement, rather than rights to its assets and obligations for its liabilities.
Investments in an associate and joint ventures are accounted for using the equity method. They are recognised
initially at cost, which includes transaction costs. Subsequent to initial recognition, the consolidated financial
statements include the Group’s share of profit or loss and other comprehensive income of equity-accounted
investees, after adjustments to align the accounting policies with those of the Group, from the date that
significant influence or joint control commences until the date that significant influence or joint control ceases.
When the Group’s share of losses exceeds its interest in an equity-accounted investee, the carrying amount
of that investment (including any long-term investments) is reduced to zero and the recognition of further
losses is discontinued except to the extent that the Group has an obligation to fund the investee’s operations
or has made payment on behalf of the investee.
Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised income or expenses arising from intra-group
transactions, are eliminated in preparing the consolidated financial statements. Unrealised gains arising from
transactions with equity-accounted investees are eliminated against the investment to the extent of the Group’s
interest in the investees. Unrealised losses are eliminated in the same way as unrealised gains, but only to
the extent that there is no evidence of impairment.
Accounting for subsidiaries, associate and joint ventures by the Trust
Investments in subsidiaries, associate and joint ventures are stated in the Trust’s statement of financial position
at cost less accumulated impairment losses.
3.2 Plant and equipment
Plant and equipment are measured at cost less accumulated depreciation and impairment losses. Cost includes
expenditure that is directly attributable to the acquisition of the asset.
When parts of an item of plant and equipment have different useful lives, they are accounted for as separate
items (major components) of plant and equipment.
The cost of replacing part of an item of plant and equipment is recognised in the carrying amount of the item
if it is probable that the future economic benefits embodied within the part will flow to the Group and its cost
can be measured reliably. The costs of the day-to-day servicing of plant and equipment are recognised in the
Statement of Total Return as incurred.
Notes to the Financial Statements
Year ended 31 December 2015
