for the year ended 31 December 2016
NOTES TO THE
FINANCIAL STATEMENTS
Baker Technology Limited
-
89
-
2.
Summaryofsignificantaccountingpolicies (cont’d)
2.4
Foreign currency
The financial statements arepresented inSingaporeDollars,which is also theCompany’s functional currency.
Eachentity in theGroupdetermines itsown functional currencyand items included in the financial statements
of each entity aremeasured using that functional currency.
(a)
Transactions and balances
Transactions in foreigncurrenciesaremeasured in the respective functional currenciesof theCompany
and its subsidiaries and are recorded on initial recognition in the functional currencies at exchange
rates approximating those ruling at the transaction dates.Monetary assets and liabilities denominated
in foreign currencies are translated at the rate of exchange ruling at the end of the reporting period.
Non-monetary items that aremeasured in terms of historical cost in a foreign currency are translated
using the exchange rates as at the dates of the initial transactions. Non-monetary items measured at
fair value in a foreign currency are translated using the exchange rates at the datewhen the fair value
wasmeasured.
Exchange differences arising on the settlement ofmonetary items or on translatingmonetary items at
the end of the reporting period are recognised in profit or loss.
(b)
Consolidated financial statements
For consolidation purposes, the assets and liabilities of foreign operations are translated into SGD at
the rate of exchange ruling at the end of the reporting period and their profit or loss are translated at
the exchange rates prevailing at the date of the transactions. The exchange differences arising on the
translation are recognised in other comprehensive income. On disposal of a foreign operation, the
component of other comprehensive income relating to that particular foreign operation is recognised
in profit or loss.
2.5
Subsidiaries
Asubsidiary is an investee that is controlledby theGroup.TheGroupcontrols an investeewhen it is exposed,
or has rights, to variable returns from its involvement with the investee and has the ability to affect those
returns through its power over the investee.
In theCompany’s separate financial statements, investments in subsidiaries areaccounted for at cost less any
impairment losses.
