Page 47 - AOB 2018 (ENG)

Audit
Oversight
Board
ANNUAL
REPORT
2018

(d) Other Income

(i) Registration fees

Registration fees are recognised as it accrues in profit or loss.

(ii) Finance income

Finance income is recognised as it accrues using effective interest method in profit or loss.

(e) Employee benefits

(i) Short-term employee benefits

Short-term employee benefit obligations in respect of salaries, annual bonuses, paid
annual leave and sick leave are measured on an undiscounted basis and are expensed as
the related service is provided.

A liability is recognised for the amount expected to be paid if the AOB has a present legal
or constructive obligation to pay this amount as a result of past service provided by the
employee and the obligation can be estimated reliably.

(ii) State plans

The AOB’s contributions to statutory pension funds are charged to profit or loss in the
year to which they relate. Prepaid contributions are recognised as an asset to the extent
that a cash refund or a reduction in future payments is available.

(f) Fair value measurement

Fair value of an asset or a liability is determined as the price that would be received to sell an
asset or paid to transfer a liability in an orderly transaction between market participants at the
measurement date. The measurement assumes that the transaction to sell the asset or transfer
the liability takes place either in the principal market or in the absence of a principal market, in
the most advantageous market.

For non-financial asset, the fair value measurement takes into account a market participant’s
ability to generate economic benefits by using the asset in its highest and best use or by selling
it to another market participant that would use the asset in its highest and best use.

PART TWO STATEMENTS | 45

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