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NOTES TO THE FINANCIAL STATEMENTS
Year ended 31 December 2013
2.
Summary of significant accounting policies (cont’d)
2.5
Functional and foreign currency (cont’d)
(b)
Foreign currency transactions
The Group’s consolidated financial statements are presented in Singapore Dollars, which is also the Company’s
functional currency. Each entity in the Group determines its own functional currency and items included in
the financial statements of each entity are measured using that functional currency.
(i)
Transactions and balances
Transactions in foreign currencies are measured in the respective functional currencies of the Company
and its subsidiaries and are recorded on initial recognition in the functional currencies at exchange
rates approximating those ruling at the transaction dates. Monetary assets and liabilities denominated
in foreign currencies are translated at the rate of exchange ruling at the end of the reporting period.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated
using the exchange rates as at the dates of the initial transactions. Non-monetary items measured
at fair value in a foreign currency are translated using the exchange rates at the date when the fair
value was determined.
Exchange differences arising on the settlement of monetary items or on translating monetary items
at the end of the reporting period are recognised in profit or loss except for exchange differences
arising on monetary items that form part of the Group’s net investment in foreign operations, which
are recognised initially in other comprehensive income and accumulated under foreign currency
translation reserve in equity. The foreign currency translation reserve is reclassified from equity to
profit or loss of the Group on disposal of the foreign operation.
(ii)
Consolidated financial statements
For consolidation purpose, the assets and liabilities of foreign operations are translated into Singapore
Dollars at the rate of exchange ruling at the end of the reporting period and their profit or loss are
translated at the exchange rates prevailing at the date of the transactions. The exchange differences
arising on the translation are recognised in other comprehensive income.
2.6
Property, plant and equipment
All items of property, plant and equipment are initially recorded at cost. Subsequent to recognition, all items of
property, plant and equipment are measured at cost less accumulated depreciation and any accumulated impairment
losses. The cost includes the cost of replacing part of the property, plant and equipment and borrowing costs that
are directly attributable to the acquisition, construction or production of a qualifying property, plant and equipment.
The cost of an item of property, plant and equipment is recognised as an asset if, and only if, it is probable that future
economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably.
When significant parts of property, plant and equipment are required to be replaced in intervals, the Group recognises
such parts as individual assets with specific useful lives and depreciation, respectively. Likewise, when a major
inspection is performed, its cost is recognised in the carrying amount of the property, plant and equipment as a
replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognised in the
profit or loss as incurred.
Overseas Education Limited AR 2013
INVESTING IN EDUCATION
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