TUNG LOK RESTAURANTS (2000) LTD / Annual Report
2016
59
Notes to the financial statements
For the financial year ended 31 March 2016
2.
Summary of significant accounting policies (cont’d)
2.24
Fair value of assets and liabilities
Fair value hierarchy
The Group categories fair value measurements using a fair value hierarchy that is dependent on the valuation inputs
used as follows:
–
Level 1 – Quoted prices (unadjusted) in active market for identical assets or liabilities that the Group can access
at the measurement date,
–
Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability,
either directly or indirectly, and
–
Level 3 – Unobservable inputs for the asset or liability.
Fair value measurements that use inputs of different hierarchy levels are categorised in its entirety in the same level of
the fair value hierarchy as the lowest level input that is significant to the entire measurement.
2.25
Contingencies
A contingent liability is:
(a)
a possible obligation that arises from past events and whose existence will be confirmed only by the occurrence
or non-occurrence of one or more uncertain future events not wholly within the control of the Group; or
(b)
a present obligation that arises from past events but is not recognised because:
(i)
It is not probable that an outflow of resources embodying economic benefits will be required to settle the
obligation; or
(ii)
The amount of the obligation cannot be measured with sufficient reliability.
A contingent asset is a possible asset that arises from past events and whose existence will be confirmed only by the
occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Group.
Contingent liabilities and assets are not recognised on the balance sheet of the Group, except for contingent liabilities
assumed in a business combination that are present obligations and which the fair values can be reliably determined.
2.26
Share capital and share issuance expenses
Proceeds from issuance of ordinary shares are recognised as share capital in equity. Incremental costs directly
attributable to the issuance of ordinary shares are deducted against share capital.
2.27
Reportable segment
Information reported to the Group’s chief operating decision maker for the purposes of resource allocation and
assessment of segment performance is specifically focused on the restaurant business which forms the basis
of identifying the operating segments of the Group under FRS 108
Operating Segments.
The aggregated restaurant
business is therefore the Group’s reportable segment.
