Page 98 - ar2013

CapitaRetail China

Annual Report 2013

96

Clarity

Notes to the

Financial Statements

Year ended 31 December 2013

1

GENERAL

(continued)

(e) Divestment fee

The Manager is entitled to receive a divestment fee of 0.5% of the sale price of any authorised investment

disposed directly or indirectly by the Trust, prorated if applicable to the proportion of the Trust’s interest.

The divestment fee is payable to the Manager in the form of cash and/or Units (as the Manager may elect)

at the prevailing market price provided that in respect of any divestment of real estate assets to interested

parties, such a fee should, if required by the applicable laws, rules and/or regulations, be in the form of

Units issued by the Trust at prevailing market price(s) and subject to such transfer restrictions as may

be imposed.

Any payment to third party agents or brokers in connection with the divestment of any authorised

investments for the Trust shall be paid by the Manager to such persons out of the deposited property of the

Trust or the assets of the relevant special purpose vehicle, and not out of the divestment fee received or to

be received by the Manager.

2

BASIS OF PREPARATION

(a) Statement of compliance

The financial statements have been prepared in accordance with the Statement of Recommended

Accounting Practice (“RAP”) 7 “Reporting Framework for Unit Trusts” issued by the Institute of Singapore

Chartered Accountants, and the applicable requirements of the Code on Collective Investment Schemes

(the “CIS Code”) issued by the Monetary Authority of Singapore (“MAS”) and the provisions of the Trust

Deed. RAP 7 requires that accounting policies adopted should generally comply with the principles relating

to recognition and measurement of the Singapore Financial Reporting Standards (“FRS”).

(b) Basis of measurement

The financial statements have been prepared on the historical cost basis except for the following material

items on the statement of financial position:

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(c) Functional and presentation currency

Items included in the financial statements of each entity in the Group are measured using the currency that

best reflects the economic substance of the underlying events and circumstances relevant to that entity

(the “functional currency”). The consolidated financial statements of the Group are presented in Singapore

dollars, which is the functional currency of the Trust. All financial information presented in Singapore dollars

has been rounded to the nearest thousand, unless otherwise stated.

(d) Use of estimates and judgements

The preparation of financial statements in conformity with RAP 7 requires the Manager to make judgements,

estimates and assumptions that affect the application of accounting policies and the reported amounts of

assets, liabilities, income and expenses. The estimates and associated assumptions are based on historical

experience and various other factors that are believed to be reasonable under the circumstances, the results

of which form the basis of making the judgements about carrying amounts of assets and liabilities that are

not readily apparent from other sources.