Page 78 - Annual Report

HONG KONG ACADEMY OF MEDICINE
學
醫
港
專
院
學
科
香 香港醫學專科學院
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

c) Basis of consolidation (Continued)

• rights arising from other contractual arrangements; and

• any additional facts and circumstances that indicate that the Group has, or does
not have, the current ability to direct the relevant activities at the time that
decisions need to be made, including voting patterns at previous members’
meetings.

Consolidation of a structured entity begins when the Group obtains control over the
structured entity and ceases when the Group loses control of the structured entity.
Specifically, income and expenses of a structured entity acquired or disposed of during
the year are included in the consolidated statement of profit or loss from the date the
Group gains control until the date when the Group ceases to control the structured
entity.

When necessary, adjustments are made to the consolidated financial statements of
structured entity to bring its accounting policies in line with the Group’s accounting
policies.

All intragroup assets and liabilities, equity, income, expenses and cash flows relating to
transactions between members of the Group are eliminated in full on consolidation.

d) Property, plant and equipment

Property, plant and equipment are stated at cost less accumulated depreciation and
impairment losses (see note 3(g)).

• right-of-use assets arising from leases over freehold or leasehold properties
where the Group is not the registered owner of the property interest; and

• items of plant and equipment, including right-of-use assets arising from leases of
underlying plant and equipment (see note 3(e)).

Historical cost includes expenditure that is directly attributable to the acquisition of the
items.

Subsequent costs are included in the asset’s carrying amount or recognised as a
separate asset, as appropriate, only when it is probable that future economic benefits
associated with the item will flow to the Group and the cost of the item can be measured
reliably. The carrying amount of the replaced part is derecognised. All other repairs and
maintenance are recognised in profit or loss during the financial period in which they are
incurred.

An asset’s carrying amount is written down immediately to its recoverable amount if the
asset’s carrying amount is greater than its estimated recoverable amount.

Depreciation is calculated to write off the cost of items of property, plant and equipment
using the straight line method over their estimated useful lives as follows:

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76 HKAM Annual Report 2023