NOTICE OF ANNUAL GENERAL MEETING
statisTICS OF SHAREHOLDINGs
FINANCIAL CONteNts
CORPORATE GOVERNANCE REPORT
65
Navigating Challenges • EMBRACING DIVERSITY | ANNUAL REPORT 2015
Notes to the financial statements
3 Significant accounting policies (Cont’d)
3.6 Inventories and work-in-progress (Cont’d)
Work-in-progress represents the gross unbilled amount expected to be collected from customers for contract
work performed to date on uncompleted shipbuilding, repair and fabrication contracts. Cost includes all
expenditure related directly to specific projects incurred in the Group’s contract activities based on normal
operating capacity.
Work-in-progress is presented as part of inventories in the statement of financial position for all contracts in
which costs incurred plus recognised profits exceed progress billings. If progress billings exceed costs incurred
plus recognised profits, then the difference is presented as part of trade and other payables in the statement of
financial position.
3.7 Financial instruments
(i)
Non-derivative financial assets
The Group initially recognises loans and receivables on the date that they are originated. All other
financial assets (including assets designated at fair value through profit or loss) are recognised initially
on the trade date, which is the date that the Group becomes a party to the contractual provisions of the
instrument.
The Group derecognises a financial asset when the contractual rights to the cash flows from the asset
expire, or it transfers the rights to receive the contractual cash flows on the financial asset in a transaction
in which substantially all the risks and rewards of ownership of the financial asset are transferred, or it
neither transfers nor retains substantially all of the risks and rewards of ownership and does not retain
control over the transferred asset. Any interest in transferred financial assets that is created or retained
by the Group is recognised as a separate asset or liability.
Financial assets and liabilities are offset and the net amount presented in the statement of financial
position when, and only when, the Group has a legal right to offset the amounts and intends either to
settle on a net basis or to realise the assets and settle the liability simultaneously.
The Group classifies its non-derivative financial assets as loans and receivables.
Loans and receivables
Loans and receivables are financial assets with fixed or determinable payments that are not quoted in an
active market. Such assets are recognised initially at fair value plus any directly attributable transaction
costs. Subsequent to initial recognition, loans and receivables are measured at amortised cost using the
effective interest method, less any impairment losses.
Loans and receivables comprise trade and other receivables, and cash and cash equivalents.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and short-term deposits with maturities of three
months or less from the date of acquisition that are subject to an insignificant risk of changes in their fair
value, and are used by the Group in the management of its short-term commitments. For the purpose of
the statement of cash flows, pledged deposits are excluded whilst bank overdrafts that are repayable on
demand and that form an integral part of the Group’s cash management are included in cash and cash
equivalents.
