NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
1
SIGNIFICANT ACCOUNTING POLICIES (Continued)
(s)
(t)
Revenue recognition (Continued)
(iii) Sale of goods
Revenue is recognised when the customer takes possession of and accepts the products. If the products are a partial fulfilment of a contract covering other goods and/or services, then the amount of revenue recognised is an appropriate proportion of the total transaction price under the contract, allocated between all the goods and services promised under the contract on a relative stand-alone selling price basis.
(iv) Ferry and shipyard operations
(v)
(vi)
Revenue relating to ferry operations is recognised when the relevant ferry services are provided.
Revenue from shipyard operations is recognised when the outcome of a contract can be reasonably measured, revenue from the contract is recognised progressively over time using the cost-to-cost method, i.e. based on the proportion of the actual costs incurred relative to the estimated total costs.
When the outcome of the contract cannot be reasonably measured, revenue is recognised only to the
extent of contract costs incurred that are expected to be recovered.
Revenue from shipyard operations was recognised on a similar basis in the comparative period.
Interest income
Interest income is recognised as it accrues using the effective interest method. Effective interest method using the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the gross carrying amount of the financial asset. For financial assets measured at amortised cost or FVOCI (recycling) that are not credit-impaired, the effective interest rate is applied to the gross carrying amount of the asset. For credit-impaired financial assets, the effective interest rate is applied to the amortised cost (i.e. gross carrying amount net of loss allowance) of the asset (see note 1(j)(i)).
Dividends
Dividend income from listed investments is recognised when the share price of the investment goes ex-dividend.
Translation of foreign currencies
Foreign currency transactions during the year are translated at the foreign exchange rates ruling at the transaction dates. The transaction date is the date on which the Company initially recognises such non- monetary assets or liabilities. Monetary assets and liabilities denominated in foreign currencies are translated at the foreign exchange rates ruling at the end of the reporting period. Exchange gains and losses are recognised in profit or loss.
Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the foreign exchange rates ruling at the transaction dates.
Hong Kong Ferry (Holdings) Company Limited
Annual Report 2018