Page 139 - One report AUCT2024_Eng

Part 3
Financial Statements
Level 1 - Use of quoted market prices in an active market for such assets or liabilities
Level 2 - Use of other observable inputs for such assets or liabilities, whether directly or indirectly Level 3 - Use of unobservable inputs such as estimates of future cash flows
At the end of each reporting period, the Company determines whether transfers have occurred between levels within the fair value hierarchy for assets and liabilities held at the end of the reporting period that are measured at fair value on a recurring basis.
5. Significant accounting judgements and estimates
The preparation of financial statements in conformity with financial reporting standards at times requires management to make subjective judgements and estimates regarding matters that are inherently uncertain. These judgements and estimates affect reported amounts and disclosures and actual results could differ. Significant judgements and estimates are as follows:
Leases - The Company as a lessee
Determining the lease term with extension and termination options
In determining the lease term, the management is required to exercise judgement in assessing whether the Company is reasonably certain to exercise the option to extend or terminate the lease considering all relevant facts and circumstances that create an economic incentive for the Company to exercise either the extension or termination option.
Estimating the incremental borrowing rate
The Company cannot readily determine the interest rate implicit in the lease, therefore, the management is required to exercise judgement in estimating its incremental borrowing rate to discount lease liabilities. The IBR is the rate of interest that the Company would have to pay to borrow over a similar term, and with a similar security, the funds necessary to obtain an asset of a similar value to the right-of-use asset in a similar economic environment.
Leasehold improvements, buildings and equipment and depreciation
In determining depreciation of leasehold improvements, buildings and equipment, the management is required to make estimates of the useful lives and residual values of the Company’s leasehold improvements, buildings and equipment and to review estimated useful lives and residual values when there are any changes.
In addition, the management is required to review leasehold improvements, buildings and equipment for impairment on a periodical basis and records impairment losses in the period when it is determined
บริษัท สหการประมูล จากัด (มหาชน)
139
Union Auction Public Company Limited