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Cathay Pacific Airways Limited Interim Report 201330
Condensed Financial Statements
Notes to the Accounts
2. Changes in accounting policies (continued)
The amendment to HKAS 1 “Presentation of Financial Statements – Presentation of Items of
Other Comprehensive Income” focuses on improving the presentation of components of other
comprehensive income items. It requires items presented in other comprehensive income to be
grouped on the basis of whether they are potentially reclassifiable to the statement of profit or loss
subsequently or not. The Group’s presentation of other comprehensive income in these interim
accounts has been modified accordingly.
The amendments to HKFRS 7 “Disclosures – Offsetting Financial Assets and Financial Liabilities”
introduce new disclosures in respect of offsetting financial assets and financial liabilities.Those new
disclosures are required for all recognised financial instruments that are set off in accordance with
HKAS 32 “Financial Instruments: Presentation” and those that are subject to an enforceable master
netting arrangement or similar agreement that covers similar financial instruments and transactions,
irrespective of whether the financial instruments are set off in accordance with HKAS 32. The adoption
of the amendments does not have an impact on the Group’s interim financial report.
HKFRS 10 “Consolidated Financial Statements” builds on existing principles by identifying the concept
of control as the determining factor in whether an entity should be included within the consolidated
financial statements of the parent company. The standard provides additional guidance to assist in
the determination of control where this is difficult to assess.The adoption does not change any of
the control conclusions reached by the Group in respect of its involvement with other entities as at
1stJanuary 2013.
HKFRS 11 “Joint Arrangements” which replaces HKAS 31 “Interests in Joint Ventures”, divides joint
arrangements into joint operations and joint ventures. Entities are required to determine the type
of an arrangement by considering the structure, legal form, contractual terms and other facts and
circumstances relevant to their rights and obligations under the arrangement. Joint arrangements
which are classified as joint operations under HKFRS 11 are recognised on a line-by-line basis to the
extent of the joint operator’s interest in the joint operation. All other joint arrangements are classified
as joint ventures under HKFRS 11 and are required to be accounted for using the equity method in
the Group’s consolidated financial statements. Proportionate consolidation is no longer allowed as an
accounting policy choice.
The adoption of HKFRS 11, which converges with International Financial Reporting Standard (“IFRS”)
11 “Joint Arrangements”, has affected the Group’s share of losses of associates. One of the Group’s
associates, on adoption of IFRS 11 in the current interim period, has changed its accounting policy
with respect to the interests in joint ventures, for which proportionate consolidation was previously
applied.This change in accounting policy has been applied retrospectively by restating the balances
at 31st December 2012 and the result for the six months ended 30th June 2012 as summarised in the
below table.