Singapore Airlines 2014 Annual Report Download - page 115

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ANNUAL REPORT FY2013/14
2 Summary of Significant Accounting Policies (continued)
฀ (e)฀ Subsidiary,฀associated฀and฀joint฀venture฀companies฀(continued)
If the Group’s ownership interest in an associated or joint venture company is reduced, but the Group continues to
apply the equity method, the Group reclassifies to profit or loss the proportion of the gain or loss that had previously
been recognised in other comprehensive income relating to that reduction in ownership interest if that gain or loss
would be required to be reclassified to profit or loss on the disposal of the related assets or liabilities.
(f) Intangible assets
(i) Computer software
Computer software acquired separately is measured initially at cost. Following initial acquisition, computer
software is stated at cost less accumulated amortisation and accumulated impairment losses, if any. These costs
are amortised using the straight-line method over their estimated useful lives of 3 to 10 years and assessed for
impairment whenever there is an indication that the computer software may be impaired. Advance and progress
payments are not amortised. The amortisation period and method are reviewed at least annually.
(ii) Deferred engine development cost
This relates to the Group’s share of engine development payments made in connection with its participation in
aircraft engine development projects with other companies. Amortisation of such intangibles begins only when the
aircraft engines are available for sale. These deferred engine development costs are amortised on a straight-line
basis over the period of expected sales of the aircraft engines, which is estimated to be over a period of 20 years.
The amortisation period and amortisation method would be reviewed annually in light of experience and changing
circumstances, and adjusted prospectively, as appropriate at the end of each reporting period.
(iii) Others
Purchased landing slots are measured initially at cost. Following initial recognition, landing slots are measured at
cost less accumulated impairment losses, if any. Landing slots based within the European Union are not amortised,
as regulations provide that these landing slots have an indefinite useful life, and are tested for impairment annually.
Licences were acquired in business combinations. These intangible assets are amortised on a straight-line basis
over an estimated useful life of 3 years.
(g) Foreign currencies
The Management has determined the currency of the primary economic environment in which the Company operates
i.e., functional currency, to be SGD. Sales prices and major costs of providing goods and services including major
operating expenses are primarily influenced by fluctuations in SGD.
Foreign currency transactions are converted into SGD at exchange rates which approximate bank rates prevailing at
dates of transactions.