China Communications Services Corporation Limited Annual Report 2015
117
NOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2015
2. SIGNIFICANT ACCOUNTING POLICIES
(continued)
(u) Income tax
(continued)
Current tax balances and deferred tax balances, and movements therein, are presented separately from each other
and are not offset. Current tax assets are offset against current tax liabilities, and deferred tax assets against deferred
tax liabilities, if the Group has the legally enforceable right to set off current tax assets against current tax liabilities
and the following additional conditions are met:
— in the case of current tax assets and liabilities, the Group intends either to settle on a net basis, or to realise the
asset and settle the liability simultaneously; or
— in the case of deferred tax assets and liabilities, if they relate to income taxes levied by the same taxation
authority on either:
— the same taxable entity; or
— different taxable entities which, intend to realise the current tax assets and settle the current tax liabilities
on a net basis or realise the assets and settle the liabilities simultaneously, in each future period in which
significant amounts of deferred tax liabilities or assets are expected to be settled or recovered.
(v) Provisions and contingent liabilities
Provisions are recognised for liabilities of uncertain timing or amount when the Group has a legal or constructive
obligation arising as a result of a past event, it is probable that an outflow of economic benefits will be required to
settle the obligation and a reliable estimate can be made. Where the time value of money is material, provisions are
stated at the present value of the expenditure expected to settle the obligation.
Where it is not probable that an outflow of economic benefits will be required, or the amount cannot be estimated
reliably, the obligation is disclosed as a contingent liability, unless the probability of outflow of economic benefits is
remote. Possible obligations, whose existence will only be confirmed by the occurrence or non-occurrence of one or
more future events, are also disclosed as contingent liabilities unless the probability of outflow of economic benefits
is remote.
(w) Revenue recognition
Revenue is measured at the fair value of the consideration received or receivable. Provided it is probable that the
economic benefits will flow to the Group and the revenue and costs, if applicable, can be measured reliably, revenue
is recognised in profit or loss as follows:
(i) Contract revenue
When the outcome of a construction contract can be estimated reliably, revenue from a fixed price contract is
recognised using the percentage of completion method.
When the outcome of a construction contract cannot be estimated reliably, revenue is recognised only to the
extent of contract costs incurred that it is probable will be recoverable.
