83
10.Subsidiaries
Receivables from subsidiaries where no allowance is made have been assessed to be creditworthy based on credit
evaluation process by management.
The receivables from subsidiaries include a principal amount of $48,100,000 (December 31, 2013: $24,100,000)
advanced to a subsidiary. This amount is unsecured, interest bearing and not expected to be repaid within 12 months
from the end of the reporting period. The effective interest rate of the advance is approximately 3% (December 31,
2013: 3%) per annum. The carrying value of these receivables from subsidiaries approximates its fair value because
the effective interest rate of the receivables approximates the market interest rate. These receivables are classified
as Level 2 within the fair value hierarchy and fair value is estimated based on discounted cash flow analysis.
The remaining balance of $54,317,000 (December 31, 2013: $59,708,000) is unsecured, interest-free and not
expected to be repaid within 12 months from the end of the reporting period. The fair value of this receivable is not
determinable as there is no fixed repayment terms and the receivable is classified as Level 3 within the fair value
hierarchy.
The investment in certain subsidiaries is stated after allowance for impairment loss as the cost of investment in
these subsidiaries have been impaired in view of losses incurred by these subsidiaries in the past.
The following is an analysis of allowance for doubtful receivables:
December 31,
2014
December 31,
2013
$’000
$’000
Unquoted equity shares, at cost
30,274
30,274
Less: Impairment loss
(4,536)
(4,536)
25,738
25,738
Receivables from subsidiaries
102,417
83,808
Less: Allowance for doubtful receivables
(50,625)
(50,677)
51,792
33,131
Total
77,530
58,869
December 31,
2014
December 31,
2013
$’000
$’000
At beginning of the year/ period
50,677
50,543
Allowance made during the year/ period
46
134
Allowance written off during the year/ period
(98)
-
At end of the year/ period
50,625
50,677
Notes to Financial Statements
December 31, 2014
CO-OPERATIVE
CO-OPERATIVE
