NOTES TO THE FINANCIAL STATEMENTS Year ended 31 December 2023 2. BASIS OF PREPARATION (continued) (d) Use of estimates and judgements (continued) Further information about the assumptions made in measuring fair values is included in the following notes: • Note 4 – Investment properties; and • Note 29 – Valuation of financial instruments. (e) Changes in accounting policies The Group has applied the following FRSs, amendments to and interpretations of FRS for the first time for the annual period beginning on 1 January 2023: • FRS 117: Insurance Contracts • Amendments to FRS 12: Deferred tax related to Assets and Liabilities arising from a Single Transaction • Amendments to FRS 12: International Tax Reform – Pillar Two Model Rules • Amendments to FRS 1 and FRS Practice Statement 2: Disclosure of Accounting Policies • Amendments to FRS 8: Definition of Accounting Estimates The application of these amendments to standards and interpretations does not have a material impact on the Group’s consolidated financial statements. In addition, the Group adopted the Amendments to FRS 1 and FRS Practice Statement 2 Disclosure of Accounting Policies from 1 January 2023. The amendments require disclosure of ‘material’, rather than ‘significant’, accounting policies. Although the amendments did not result in any changes to the accounting policies themselves, they impacted the accounting policy information disclosed in certain instances. 3. MATERIAL ACCOUNTING POLICIES The accounting policies set out below have been applied consistently to all periods presented in these financial statements, and have been applied consistently by Group entities, except as explained in Note 2(e), which addresses changes in material accounting policies. (a) Basis of consolidation (i) Business combinations and property acquisitions The Group accounts for business combinations using the acquisition method when the acquired set of activities and assets meets the definition of a business and control is transferred to the Group (see Note 3(a)(ii)). In determining whether a particular set of activities and assets is a business, the Group assesses whether the set of assets and activities acquired includes, at a minimum, an input and substantive process and whether the acquired set has the ability to produce outputs. The Group has an option to apply a ‘concentration test’ that permits a simplified assessment of whether an acquired set of activities and assets is not a business. The optional concentration test is met if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets. 168 CAPITALAND CHINA TRUST
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