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EC World Real Estate Investment Trust ANNUAL REPORT 2016
NOTES TO THE
Financial Statements
For the Financial Year ended 31 December 2016
2.
Significant accounting policies (continued)
2.5 Group accounting (continued)
(a) Subsidiaries (continued)
(iii) Disposals
When a change in ECW’s ownership interest in a subsidiary results in a loss of control over the
subsidiary, the assets and liabilities of the subsidiary including any goodwill are derecognised. Amounts
previously recognised in other comprehensive income in respect of that entity are also reclassified
to the Statement of Total Return or transferred directly to Unitholders’ funds if required by a specific
Standard.
Any retained equity interest in the entity is remeasured at fair value. The difference between the
carrying amount of the retained interest at the date when control is lost and its fair value is recognised
in the Statement of Total Return.
Please refer to the paragraph “Investments in subsidiaries” for the accounting policy on investments in
subsidiaries in the separate financial statements of ECW.
2.6 Investment properties
Investment properties are properties held either to earn rental income or capital appreciation, or for both.
Investment properties are accounted for as non-current assets and initially recognised at cost on acquisition, and
subsequently carried at fair value. Fair values are determined in accordance with the Trust Deed, which requires
the investment properties to be valued by independent registered valuers at least once a year, in accordance with
CIS issued by MAS. Changes in fair values are recognised in the Statement of Total Return.
Investment properties are subject to renovations or improvement from time to time. The cost of major renovations
and improvement are capitalised and the carrying amounts of the replaced components are recognised in the
Statement of Total Return. The costs of maintenance, repairs and minor improvements are recognised in the
Statement of Total Return when incurred.
On disposal of an investment property, the difference between the net disposal proceeds and the carrying amount
is recognised in the Statement of Total Return.
2.7 Investment in subsidiaries
Investment in subsidiaries is carried at cost less accumulated impairment losses in ECW’s Statements of Financial
Position. On disposal of such investments, the difference between disposal proceeds and the carrying amounts
of the investments are recognised in the Statement of Total Return.
2.8 Impairment of non-financial assets
Investment in subsidiaries
Investment in subsidiaries is reviewed for impairment whenever there is any objective evidence or indication that
this asset may be impaired.