Page 55 - Inegrated Annual Report 2020-Eng

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS | 31 DECEMBER 2020

Under the equity method, the investment in a joint venture is initially recognised at cost. The carrying amount of
the investment is adjusted to recognise changes in the Group’s share of net assets of the joint venture since the
acquisition date. Goodwill relating to the joint venture is included in the carrying amount of the investment and is
neither amortised nor individually tested for impairment.

The consolidated statement of profit or loss reflects the Group’s share of the results of operations of the joint
venture. Any change in other comprehensive income of the joint venture is presented as part of the Group’s
other comprehensive income. In addition, when there has been a change recognised directly in the equity of the
joint venture, the Group recognises its share of any changes, when applicable, in the consolidated statement
of changes in equity. Unrealised gains and losses resulting from transactions between the Group and the joint
venture are eliminated to the extent of the interest in the joint venture.

After application of the equity method, the Group determines whether it is necessary to recognise an impairment
loss on its investment in its joint venture. At each reporting date, the Group determines whether there is objective
evidence that the investment in the joint venture is impaired. If there is such evidence, the Group calculates the
amount of impairment as the difference between the recoverable amount of the joint venture and its carrying
value, then recognises the loss as ‘Share of results of joint ventures’ in the consolidated statement of profit or
loss.

Revenue from contracts with customers

IFRS 15 establishes a five-step model that applies to revenue arising from contracts with customers. Revenue is
recognised at an amount that reflects the consideration to which the Group expects to be entitled in exchange
for transferring goods or services to a customer. The five steps are:

Step 1 Identify contract(s) with a customer;

Step 2 Identify performance obligations in the contract;

Step 3 Determine the transaction price;

Step 4 Allocate the transaction price to the performance obligations in the contract; and

Step 5 Recognise revenue when (or as) the Group satisfies a performance obligation.

The Company satisfies a performance obligation and recognises revenue over time, if one of the following criteria
is met:

a. The Group’s performance does not create an asset with an alternate use to the Group and the Group has as
an enforceable right to payment for performance completed to date.

b. The Group’s performance creates or enhances an asset that the customer controls as the asset is created
or enhanced.

c. The customer simultaneously receives and consumes the benefits provided by the Group’s performance as
the Group performs.

For performance obligations where one of the above conditions are not met, revenue is recognised at the point
in time at which the performance obligation is satisfied.

Revenue from contracts with customers is recognised when control of the goods or services are transferred
to the customer at an amount that reflects the consideration to which the Group expects to be entitled in
exchange for those goods or services. The Group recognises revenue when the amount of revenue can be
reliably measured; when it is probable that future economic benefits will flow to the entity; and when specific
criteria have been met for each of the Group’s activities, as described above. The Group bases its estimate
of return on historical results, taking into consideration the type of customer, the type of transaction and the
specifics of each arrangement.

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