Lenovo 2012 Annual Report Download - page 113

2011/12 Annual Report Lenovo Group Limited 111
NOTES TO THE FINANCIAL STATEMENTS
1 Basis of preparation
ThefinancialstatementshavebeenpreparedinaccordancewithHongKongFinancialReportingStandards(“HKFRS”).The
financial statements have been prepared under the historical cost convention except that certain financial assets and financial
liabilities are stated at fair values, as explained in the significant accounting policies set out below.
The preparation of financial statements in conformity with HKFRS requires the use of certain critical accounting estimates.
It also requires management to exercise its judgment in the process of applying the Group’s accounting policies. The areas
involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the financial
statements are disclosed in Note 4.
Changes in accounting policies and disclosures
The Group has adopted the following revised standard, new interpretations, and amendments to existing standards and
interpretations that are mandatory for the year ended March 31, 2012 and where considered appropriate and relevant to its
operations:
– HKAS 24 (Revised), Related party disclosures
– HK(IFRIC)-Int 19, Extinguishing financial liabilities with equity instruments
– Amendments to HK(IFRIC)-Int 14, Prepayments of a minimum funding requirement
– Improvements to HKFRSs 2010
The adoption of these newly effective standard, interpretations and amendments does not result in substantial changes to the
Group’s accounting policies or financial results.
At the date of approval of these financial statements, the following new and revised standards and amendments to existing
standards have been issued but are not effective for the year ended March 31, 2012 and have not been early adopted:
Effective for annual
periods beginning
on or after
HKAS 19 (2011), Employee benefits January 1, 2013
HKAS 27 (2011), Separate financial statements January 1, 2013
HKAS 28 (2011), Investments in associates and joint ventures January 1, 2013
HKFRS 9, Financial instruments January 1, 2015
HKFRS 10, Consolidated financial statements January 1, 2013
HKFRS 11, Joint arrangements January 1, 2013
HKFRS 12, Disclosure of interests in other entities January 1, 2013
HKFRS 13, Fair value measurement January 1, 2013
Amendments to HKAS 1 (Revised), Presentation of items of other comprehensive income July 1, 2012
Amendments to HKAS 12, Deferred tax: Recovery of underlying assets January 1, 2012
Amendments to HKAS 32, Financial instruments: Presentation –
Offsetting financial assets and financial liabilities January 1, 2014
Amendments to HKFRS 7, Financial instruments: Disclosures –
Offsetting financial assets and financial liabilities January 1, 2013
Amendments to HKFRS 7, Financial instruments: Disclosures –
Transfers to financial assets July 1, 2011
The Group is currently assessing the impact of the adoption of these new and revised standards and amendments to existing
standards to the Group in future periods. So far, it has concluded that the adoption of the above does not have material
impact on the Group’s financial statements.
Changes in presentation
For presentation of segment results, certain expenses have been reclassified, in particular, expenditures on aligning the
informationtechnologysystems(“ITsystems”).Inthepreviousyears,expendituresonaligningtheITsystemsofmatureand
emerging markets were included in the respective markets. The Group has substantially completed the alignment of the IT
systems with key business systems converged in the same platform. With effect from the current fiscal year, expenditures
on IT systems are allocated to market segments on a flat rate basis with reference to revenue contributions of the respective
markets. Management considers this basis is more appropriate in the measurement of market segment results.