2
BASIS OF PREPARATION
(continued)
2.4 Use of estimates and judgements
(continued)
Information about critical judgements in applying accounting policies that have the most significant effect on the amounts
recognised in the financial statements is included in the following note:
Note 24 – Revenue: determination of whether the Company acts as an agent in the transaction rather than as a
principal following the renewal of a contract with a related corporation.
Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment
within the next financial year are included in the following notes:
Note 5 – Key assumptions used in determining the recoverable amounts of intangible assets arising from the
acquisitions of subsidiaries and investment in subsidiaries
Note 9 – Valuation of inventories
Note 11 – Valuation of receivables
Note 26 – Assessment of income tax provision
2.5 Changes in accounting policies
On 1 January 2015, the Group adopted new or amended FRS and interpretations to FRS (“INT FRS”) that are mandatory for
application from that date. Changes to the Group’s accounting policies have been made as required, in accordance with the
transitional provisions in the respective FRS and INT FRS.
The adoption of these new or amended FRS and INT FRS did not result in substantial changes to the Group’s accounting policies
and had no material effect on the amounts reported for the current or prior financial years.
3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting policies set out below have been applied consistently to all periods presented in these financial statements and
have been applied consistently by Group entities.
3.1 BASIS OF CONSOLIDATION
Business combinations
Business combinations are accounted for using the acquisition method as at the acquisition date, which is the date on which
control is transferred to the Group.
Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially
at their fair values at the acquisition date.
The consideration transferred does not include amounts related to the settlement of pre-existing relationships. Such amounts
are generally recognised in the income statement.
Costs related to the acquisition, other than those associated with the issue of debt or equity securities, that the Group incurs
in connection with a business combination are expensed as incurred.
62
TELECHOICE INTERNATIONAL LIMITED
2015 ANNUAL REPORT
NOTES TO THE
FINANCIAL STATEMENTS
