Annual Report 2016
73
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED MARCH 31, 2016
2.
APPLICATION OF INTERNATIONAL FINANCIAL REPORTING STANDARDS
– continued
Amendments to IAS 16 and IAS 38 Clarification of Acceptable Methods of Depreciation
and Amortisation
The amendments to IAS 16 prohibit entities from using a revenue-based depreciation method
for items of property, plant and equipment. The amendments to IAS 38 introduce a rebuttable
presumption that revenue is not an appropriate basis for amortisation of an intangible asset. This
presumption can only be rebutted in the following two limited circumstances:
(a)
when the intangible asset is expressed as a measure of revenue; or
(b)
when it can be demonstrated that revenue and consumption of the economic benefits of the
intangible asset are highly correlated.
The amendments apply prospectively for annual periods beginning on or after January 1, 2016.
Currently, the Group uses the straight-line method for depreciation and amortisation for its
property, plant and equipment, and intangible assets respectively. The directors of the Company
believe that the straight-line method is the most appropriate method to reflect the consumption of
economic benefits inherent in the respective assets and accordingly, the directors of the Company
do not anticipate that the application of these amendments to IAS 16 and IAS 38 will have a
material impact on the accompanying financial statements.
Except as described above, the directors anticipate that the application of the other new and
revised standards and interpretations will have no material impact on the statement of profit or
loss and other comprehensive income and the statement of financial position of the Group and the
Company.
