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2. Summary of Significant Accounting Policies (cont’d)
PATRONAGE REBATES
Patronage rebates distributed to the members of the Co-operative/NTUC Union cardholders (“members”) are recognised
as a liability in the Co-operative’s and the Group’s financial statements in the period in which the patronage rebates are
approved by the members at the annual general meeting. Patronage rebates which are not claimed within 3 years from
the date of payment by members are written back in accordance with By-Law 13.4.2 and the rules of NTUC Union Card
Scheme.
BORROWING COSTS
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets
that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those
assets, until such time as the assets are substantially ready for their intended use or sale. Investment income earned on
the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the
borrowing costs eligible for capitalisation.
All other borrowing costs are recognised in profit or loss in the period in which they are incurred.
RETIREMENT BENEFIT COSTS
Payments to defined contribution retirement benefit plans are charged as an expense when employees have rendered
the services entitling them to the contributions. Payments made to state-managed retirement benefit schemes, such
as the Singapore Central Provident Fund, are dealt with as payments to defined contribution plans where the Group’s
obligations under the plans are equivalent to those arising in a defined contribution retirement benefit plan.
EMPLOYEE LEAVE ENTITLEMENT
Employee entitlements to annual leave are recognised when they accrue to employees. A provision is made for the
estimated liability for annual leave as a result of services rendered by employees up to the reporting period.
GOVERNMENT GRANTS
Government grants are not recognised until there is reasonable assurance that the Group will comply with the conditions
attaching to them and the grants will be received. Grants are recognised as income over the periods necessary to match
them with the costs for which they are intended to compensate.
Notes to Financial Statements
December 31, 2014
