Asian Plantations Limited Final Results & Notice -10-
July 01 2014 - 3:30AM
UK Regulatory
An impairment exists when the carrying value of an asset or cash
generating unit exceeds its recoverable amount, which is the higher
of its fair value less costs to sell and its value in use. The
value in use calculation is based on a discounted cash flow model.
The cash flows are derived from projected net cash flows over a
period of 25 productive years of oil palms from financial budgets
approved by management and do not include restructuring activities
that the Group is not yet committed to or significant future
investments that will enhance the asset's performance of the cash
generating unit being tested. The recoverable amount is most
sensitive to the discount rate used for the discounted cash flow
model as well as the expected future cash inflows. Further details
of the key assumptions applied in the impairment assessment of
goodwill, are given in Note 18.
(d) Taxes
Uncertainties exist with respect to the interpretation of
complex tax regulations, changes in tax laws, and the amount and
timing of future taxable income. Given the wide range of
international business relationships and the long-term nature and
complexity of existing contractual agreements, differences arising
between the actual results and the assumptions made, or future
changes to such assumptions, could necessitate future adjustments
to tax income and expense already recorded. The Group establishes
provisions, based on reasonable estimates, for possible
consequences of audits by the tax authorities of the respective
counties in which it operates. The amount of such provisions is
based on various factors, such as experience of previous tax audits
and differing interpretations of tax regulations by the taxable
entity and the responsible tax authority. Such differences of
interpretation may arise for a wide variety of issues depending on
the conditions prevailing in the respective domicile of the Group
of companies.
The carrying amount of income tax recoverable at 31 December
2013 was USD36,000 (2012: USD99,000).
Deferred tax assets are recognised for all unused tax losses,
unabsorbed capital and agricultural allowances to the extent that
it is probable that taxable profit will be available against which
the losses, unabsorbed capital and agricultural allowances can be
utilised. Significant management judgement is required to determine
the amount of deferred tax assets that can be recognised, based
upon the likely timing and the level of future taxable profits
together with future tax planning strategies.
Further details on taxes are disclosed in Note 13.
(e) Share-based payment
The Group measures the cost of equity-settled transactions with
directors, employees and consultants by reference to the fair value
of the equity instruments at the date at which they are granted.
Estimating fair value for share-based payment transactions requires
determination of the most appropriate valuation model, which is
dependent on the terms and conditions of the grant. This estimate
also requires determination of the most appropriate inputs to the
valuation model including the expected life of the share option,
volatility and dividend yield and making assumptions about them.
The assumptions and models used for estimating fair value for
share-based payment transactions are disclosed in Note 29.
5. Standards issued but not yet effective
The standards and interpretations that are issued, but not yet
effective, up to the date of issuance of the Group's financial
statements are disclosed below. The Group intends to adopt these
standards, if applicable, when they become effective.
IFRS 9 Financial Instruments
IFRS 9, as issued, reflects the first phase of the IASB's work
on the replacement of IAS 39 and applies to classification and
measurement of financial assets and financial liabilities as
defined in IAS 39. The standard was initially effective for annual
periods beginning on or after 1 January 2013, but Amendments to
IFRS 9 Mandatory Effective Date of IFRS 9 and Transition
Disclosures, issued in December 2011, moved the mandatory effective
date to 1 January 2015. In subsequent phases, the IASB is
addressing hedge accounting and impairment of financial assets. The
adoption of the first phase of IFRS 9 will have an effect on the
classification and measurement of the Group's financial assets, but
will not have an impact on classification and measurements of the
Group's financial liabilities. The Group will quantify the effect
in conjunction with the other phases, when the final standard
including all phases is issued.
Investment Entities (Amendments to IFRS 10, IFRS 12 and IAS
27)
These amendments are effective for annual periods beginning on
or after 1 January 2014 provide an exception to the consolidation
requirement for entities that meet the definition of an investment
entity under IFRS 10. The exception to consolidation requires
investment entities to account for subsidiaries at fair value
through profit or loss. It is not expected that this amendment
would be relevant to the Group, since none of the entities in the
Group would quality to be an investment entity under IFRS 10.
IAS 32 Offsetting Financial Assets and Financial Liabilities -
Amendments to IAS 32
These amendments clarify the meaning of "currently has a legally
enforceable right to set-off" and the criteria for non-simultaneous
settlement mechanisms of clearing houses to qualify for offsetting.
These are effective for annual periods beginning on or after 1
January 2014. These amendments are not expected to be relevant to
the Group.
IFRIC Interpretation 21 Levies (IFRIC 21)
IFRIC 21 clarifies that an entity recognises a liability for a
levy when the activity that triggers payment, as identified by the
relevant legislation, occurs. For a levy that is triggered upon
reaching a minimum threshold, the interpretation clarifies that no
liability should be anticipated before the specified minimum
threshold is reached. IFRIC 21 is effective for annual periods
beginning on or after 1 January 2014. These amendments are not
expected to be relevant to the Group.
IAS 39 Novation of Derivatives and Continuation of Hedge
Accounting - Amendments to IAS 39
These amendments provide relief from discontinuing hedge
accounting when novation of a derivative designated as a hedging
instrument meets certain criteria. These amendments are effective
for annual periods beginning on or after 1 January 2014. These
amendments are not expected to be relevant to the Group.
6. Revenue
2013 2012
USD'000 USD'000
Sale of crude palm oil ("CPO") 19,554 -
Sale of palm kernel ("PK") 2,451 -
Sale of fresh fruit bunches ("FFBs") 1,758 2,820
23,763 2,820
7. Cost of sales
2013 2012
USD'000 USD'000
FFBs harvesting 716 351
FFBs external transportation 400 245
Field upkeep and maintenance 3,594 766
Estate general charges 676 228
Direct production costs - CPO and
PK 18,319 -
Mill overheads 443 92
Mill transport 744 -
Employee benefits expense (Note 12) 1,147 432
Depreciation of property, plant and
equipment 1,376 100
Rental expense 62 11
27,477 2,225
8. Other operating income
2013 2012
USD'000 USD'000
Interest income 245 280
Gain on disposal of property, plant
and equipment 6 -
Sale of seedlings - 66
Gain arising on fair value changes
in biological assets 3,183 1,989
Gain arising from changes in fair
value of
embedded derivative of the convertible
bonds 721 172
Others 29 -
4,184 2,507
9. Administrative expenses
2013 2012
USD'000 USD'000
Professional fees:
- audit fee 106 129
- consultancy 392 631
- MTN Programme - 195
- others 302 391
Stamp duty on agreements 23 2
Bank charges 56 29
Employee benefits expense (Note 12) 1,514 2,812
Directors' fees (Note 31) 187 187
Loss on disposal of property, plant
and equipment - 1
Depreciation of property, plant and
equipment 132 151
Rental expense 17 55
Others 677 556
3,406 5,139
10. Other operating expenses
2013 2012
USD'000 USD'000
Amortisation of land use rights (Note
17) 1,002 924
Repair and maintenance 202 117
Motor vehicle running expenses - 10
Cost of seedlings sold 8 54
Impairment of goodwill (Note 1(b)) - 5
Net foreign exchange loss 82 444
1,294 1,554
11. Finance costs
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