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bh global marine LIMITED
ANNUAL REPORT 2012
NOTES TO THE FINANCIAL STATEMENTS
(CONT’D)
For the fnancial year ended 31 December 2012
2 Signifcant accounting policies (cont’d)
b) Revenue recognition
Revenue comprises the fair value for the consideration received or receivable for the sale of goods and rendering of
services, net of goods and services tax, rebates and discounts, and after eliminating sales within the Group. Revenue
is recognised to the extent that it is probable that the economic benefts associated with the transaction will fow to the
entity, and the amount of revenue and related cost can be reliably measured.
Revenue from sale of goods is recognised when a Group entity has delivered the products to the customer and signifcant
risks and rewards of ownership of the goods have been passed to the customer.
Revenue from services is recognised during the fnancial year in which the services are rendered, by reference to
completion of the specifc transaction assessed on the basis of the actual service provided as a proportion of the total
services to be performed. The accounting policy for revenue from construction contracts is disclosed in Note 2(l).
Interest income is recognised on a time proportion basis using the effective interest method.
Dividend income is recognised when the right to receive payment is established.
c) Subsidiaries
A subsidiary is an entity over which the Group has the power to govern the fnancial and operating policies so as to
obtain benefts from its activities. The Group generally has such power when it directly or indirectly, holds more than 50%
of the issued share capital, or controls more than half of the voting power, or controls the composition of the board of
directors. The existence and effect of potential voting rights that are currently exercisable or convertible are considered
when assessing whether the Group has control over another entity.
In the Company’s statement of fnancial position, investment in subsidiaries are accounted for at cost less accumulated
impairment losses. On disposal of the investment, the difference between disposal proceeds and the carrying amounts
of the investments are recognised in proft or loss.
d) Basis of consolidation
The consolidated fnancial statements comprise the fnancial statements of the Company and its subsidiaries at the end
of the reporting period. The fnancial statements of the subsidiaries are prepared for the same reporting date as the
parent company. Consistent accounting policies are applied for like transactions and events in similar circumstances.
Intragroup balances and transactions, including income, expenses and dividends, are eliminated in full. Profts and
losses resulting from intragroup transactions that are recognised in assets, such as inventory and property, plant and
equipment, are eliminated in full.
Subsidiaries are consolidated from the date of acquisition, being the date on which the Group obtains control, and
continue to be consolidated until the date that such control ceases.
Business combinations are accounted for using the acquisition method. The consideration transferred for the acquisition
comprises the fair value of the assets transferred, the liabilities incurred and the equity interests issued by the Group. The
consideration transferred also includes the fair value of any contingent consideration arrangement and the fair value of
any pre-existing equity interest in the subsidiary. Acquisition-related costs are expensed as incurred. Identifable assets
acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair
values at the acquisition date.
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