Notes on The Accounts (Continued)
1. SIGNIFICANT ACCOUNTING POLICIES (Continued)
(i) Deferred taxation
Deferred taxation is calculated under the liability method in respect of the taxation effect arising from all timing differences which are expected with reasonable probability to crystallise in the foreseeable future.
(i) Deferred profits
Profits from the sale of land and buildings to associated companies for development for resale and investment are deferred to the extent of the group's attributable interest in the associated companies. The deferred profits will be recognised and taken to profit and loss account as and when the properties are sold by the associated companies to third parties.
(k) Revenue recognition
(i) Fare receipts are recognised when the relevant bus services are provided.
(ii) Advertising revenue is recognised when the related advertisement or commercial appears before the public.
(iii) Interest income from bank deposits is accrued on a time proportion basis on the principal outstanding and at the rate applicable.
2. TURNOVER
3.
Turnover comprises fares and other income from the operation of franchised motor buses by the group analysed as follows:
1997
1996
$000's
$000's
Fare receipts Advertising revenue
814,881
752,195
18,148
21,365
833,029
773,560
OPERATING PROFIT
Operating profit is arrived at
after charging:-
The group
The company
1997
1996
1997
1996
$000's
$000's
$000's $000's
Auditors' remuneration
Depreciation
1,333
1,239
1,195
1,111
34,761
29,955
34,761
29,955
Provision for employees' retirement schemes
71,699
28,245 71,699
28,245
Provision for insurance
21,417
21,417
Provision for major repairs to motor buses
6,195
7,140
6,195
7,140
Provision for obsolescence of stores and spare parts
2,423
892
2,423
892
Operating lease charges for land and buildings
214
219
214
219
and after crediting:-
Provision for insurance written back
Interest income
Exchange gain
Income from listed investments
Dividend income from subsidiary
21
7,947
7,947
50,381
44,928
11,938
15,719
362
73
362
73
29
89
231,341
118,187
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