97
13.Property, Plant and Equipment (cont’d)
As disclosed in Note 3, the Group assesses annually whether property, plant and equipment have any indication of
impairment in accordance with their accounting policy. Where there is indication of impairment, the recoverable amounts
of property, plant and equipment would be determined based on the higher of fair value less costs to sell and value-in-use
calculations. During the year, the Group carried out a review of the property, plant and equipment of the Group, including
the supermarket outlets being the cash generating units used in their assessment of impairment. The assessment led to
reversal of a net impairment loss of $3,233,000 (December 31, 2013 : net impairment loss of $3,606,000) and $3,647,000
(December 31, 2013 : net impairment loss of $3,367,000) that has been recognised in profit or loss of the Group and
Co-operative respectively (Note 23). The write-back of impairment loss represents the adjustment of property, plant and
equipment to their recoverable amounts for outlets with improved performance. The estimates of recoverable amount
were based on value in use of the Group’s supermarket outlets and determined using a discount rate of 10% (December
31, 2013: 10%).
During the financial year, the Group’s additions to property, plant and equipment were financed as follows:
Notes to Financial Statements
December 31, 2014
December 31,
2014
December 31,
2013
$’000
$’000
Additions to property, plant and equipment
219,024
172,613
Acquired under other payables
(59,871)
-
Cash payments to acquire property, plant and equipment
159,153
172,613
GROUP
14.Other Receivables from Associates
(a) The loan to an associate, Mercatus Co-operative Limited, includes a principal amount of $164,700,000 plus
compounded interest as at December 31, 2014. This amount is unsecured, interest bearing based on (i) 6.5% of the
shareholder’s loan amount or (ii) 95% of the Co-operative’s share of Net Distributable Surplus in respect of each
financial year, whichever amount is lower, and not expected to be repaid within 12 months from the end of the
current financial year. The Co-operative and the other shareholders of Mercatus Co-operative Limited have given a
letter of undertaking that they will not demand payment of the loan within the next 12 months from December 31,
2014. The fair value of this loan is not determinable as there is no fixed repayment terms and the loan is classified as
Level 3 within the fair value hierarchy.
The loan to an associate also includes an amount of $4,050,000 (December 31, 2013 : $3,450,000) loan to SMRT
Alphaplus Pte. Ltd. at the end of the financial period. This amount is unsecured and bears an interest of 4% (December
31, 2013 : 4%) per annum. The carrying value of the loan to SMRT Alphaplus Pte. Ltd. approximates its fair value
because the effective interest rate of the loan to an associate approximates the market interest rate. This loan is
classified as Level 2 within the fair value hierarchy and fair value is estimated based on discounted cash flow analysis.
All the receivables from the associates are denominated in Singapore dollars
December 31,
2014
December 31,
2013
December 31,
2014
December 31,
2013
$’000
$’000
$’000
$’000
Loan to an associate (a)
179,456
175,376
175,406
171,926
GROUP
CO-OPERATIVE
