49
:
BANK OF CREDIT AND COMMERCE
HONG KONG LIMITED
NOTES TO THE ACCOUNTS
1. Bsis of Preparation of Accounts
Bank of Credit and Commerce Hong Kong Limited ("BCCHKL") is a significant subsidiary of BCCI Holdings Luxembourg) S.A. ("BCCI"). Since the year endiac 31 December 1790, the majority shareholders of BCCI have recapitalised BCCHKL and will maintain capital adequacy requirements and interd to refinance and restructura BCCI.
The majority shareholders have confirmed their intention to provide financial support requ..red to enable BCCHKL to continue trading for foreseeable future.
2. Significant Accounting Policies
Basis of Consolidation
the
and its
The consolidated accounts incorporate' the accounts of the bank principal subsidiaries. Certain subsidiaries have been excluded from the conaclidation where he financial amounts and activities of the subsidiary are immaterial to the group.
Investments
a. Subsidiaries
A company is a sut sidiary if more than 50% of the issued voting capital is held for the long term. Investments in subsidiaries are ca ^ried at cost.
b. Other Investments
Log-term investment s in securities redeemable at fixed dates are atated at cost, less provision for any permanent diminution in value.
Listed investments held on a long-term basis and unlisted investments ar stated at cost less provision for any permanent diminution in
va.ue.
Liated investments held for dealing purposes are carried at the lower of cost and market value on a portfolio basis.
Investments in securities which are intended to be held until maturity are carried at cost. Premiums and discounts on investments redeemable at fixed dates are amortised over the remaining period to maturity.
Foreign Currency Translation
All monetary assets and liabilities denominated in foreign currencies are translated at the rates of exchange ruling at the balance sheet date. All oreign currency transactions during the year are converted at the excharge rates existing on the respective transaction dates.
Unmatɩred forward foreign exchange contracts and engagements on behalf of customers are translated at the rates of exchange ruling at the balance sheet date.
Realized and unrealized foreign exchange gains or losses have been credited or charged, respectively, to the profit and loss account.
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IM. MAR
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22 3 S660 S8 S8
(3SNOK 1009) 301:30 SWWOO PS:8T 60-80-1661