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bh global marine LIMITEDANNUAL REPORT 2012
NOTES TO THE FINANCIAL STATEMENTS (CONT’D)
For the fnancial year ended 31 December 2012
2 Signifcant accounting policies (cont’d)
a) Basis of preparation (cont’d)
Amendments to FRS 1 Presentation of Items of Other Comprehensive Income
The Amendments to FRS 1 Presentation of Items of Other Comprehensive Income (OCI) is effective for fnancial periods
beginning on or after 1 July 2012.
The Amendments to FRS 1 changes the grouping of items presented in OCI. Items that could be reclassifed to proft
or loss at a future point in time would be presented separately from items which will never be reclassifed. As the
Amendments only affect the presentations of items that are already recognised in OCI, the Group does not expect any
impact on its fnancial position or performance upon adoption of this standard.
FRS 111 Joint Arrangement and Revised FRS 28 Investments in Associates and Joint Ventures
FRS 111 Joint Arrangements and Revised FRS 28 Investments in Associates and Joint Ventures are effective for fnancial
periods beginning on or after 1 January 2014.
FRS 111 classifes joint arrangements either as joint operations or joint ventures. Joint operation is a joint arrangement
whereby the parties that have rights to the assets and obligations for the liabilities whereas joint venture is a joint
arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the
arrangement.
FRS 111 requires the determination of joint arrangement’s classifcation to be based on the parties’ rights and obligations
under the arrangement, with the existence of a separate legal vehicle no longer being the key factor. FRS 111 disallows
proportionate consolidation and requires joint ventures to be accounted for using the equity method. The revised FRS
28 was amended to describe the application of equity method to investments in joint ventures in addition to associates.
The Group currently applies equity accounting for its joint venture. As such, the Group does not expect any change to
the Group’s fnancial statement presentation upon adoption of FRS 111.
FRS 112 Disclosure of Interests in Other Entities
FRS 112 Disclosure of Interests in Other Entities is effective for fnancial period beginning on or after 1 January 2014.
FRS 112 is a new and comprehensive standard on disclosure requirements for all forms of interest in other entities,
including joint arrangements, associates, special purpose vehicles and other off balance sheet vehicles. FRS 112
requires an entity to disclose information that helps users of its fnancial statements to evaluate the nature and risks
associated with its interests in other entities and the effects of those interests on its fnancial statements. As this is
a disclosure standard, it will have no impact to the fnancial position and fnancial performance of the Group when
implemented in 2014.
FRS 110 Consolidated Financial Statements and Revised FRS 27 Separate Financial Statements
FRS 110 Consolidated Financial Statements and Revised FRS 27 Separate Financial Statements are effective for
fnancial periods beginning on or after 1 January 2014.
FRS 110 establishes a single control model that applies to all entities including special purpose entities. The changes
introduced by FRS 110 will require management to exercise signifcant judgment to determine which entities are
controlled, and therefore are required to be consolidated by the Group, compared with the requirements that were in FRS
27. Therefore, FRS 110 may change which entities are consolidated within a group. The revised FRS 27 was amended
to address accounting for subsidiaries, jointly controlled entities and associates in separate fnancial statements.
The Group has yet to assess the full impact of FRS 110 and intends to apply the Standard from 1 January 2014.