China Communications Services Corporation Limited Annual Report 2015
155
NOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2015
41. SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGEMENTS
(continued)
(d) Depreciation and amortisation
Property, plant and equipment and intangible assets with finite useful lives are depreciated/amortised on a straight-
line basis over the estimated useful lives of the assets, after taking into account their estimated residual value. The
Group reviews the estimated useful lives and residual values of the assets annually in order to determine the amount
of depreciation/amortisation expense to be recorded during any reporting period. The useful lives and residual values
are based on the Group’s historical experience with similar assets and taking into account anticipated technological
changes. The depreciation and amortisation expense for future periods is adjusted if there are significant changes
from previous estimates.
(e) Deferred tax assets
The recognition of deferred tax assets requires assessment of the temporary differences which arise as a consequence
of different accounting and tax treatments. These temporary differences result in deferred tax assets are included
within the consolidated statement of financial position. Deferred tax assets are measured using substantially enacted
tax rates expected to apply when the temporary differences reverse. Deferred tax assets are not recognised where it
is more likely than not that the asset will not be realised in the future. This evaluation requires judgements to be
made including the forecast of future taxable income. Recognition therefore, involves management’s judgement
regarding the future financial performance of the particular legal entity in which the deferred tax asset has been
recognised and interpretation of country specific tax law and the likelihood of settlement. However the actual tax
assets could differ from the provision and in such event the Group would be required to make an adjustment in a
subsequent period which could have a material impact on the Group’s profit and loss.
42. RELATED PARTIES
The Group is part of a larger group of companies under CTC Group and has significant transactions and relationships with
members of CTC Group. Apart from the transactions and balances disclosed in the consolidated financial statements set
out in above notes, there are the following related party transactions:
(a) Transactions with CTC Group and other related parties
Companies are considered to be related if one company has the ability, directly or indirectly, to control or jointly
control the other company or have significant influence over the other company in making financial and operating
decisions. Companies are also considered to be related if they are subject to common control.
Because of the relationships between the Group and CTC Group, it is possible that the terms of those transactions
are not the same as those that would result from transactions among unrelated parties.
