HUTCHISON PORT HOLDINGS TRUST 148 NOTES TO THE FINANCIAL STATEMENTS 2 Basis of preparation and material accounting policy information (Continued) (i) Goodwill (Continued) The total impairment loss of a CGU is allocated fi rst to reduce the carrying amount of goodwill allocated to the CGU and then to the other assets of the CGU pro-rata on the basis of the carrying amount of each asset in the CGU. An impairment loss on goodwill is recognised as an expense and is not reversed in a subsequent period. The profi t or loss on disposal is calculated by reference to the net assets at the date of disposal including the attributable amount of goodwill but does not include any attributable goodwill previously eliminated against reserves. (j) Railway usage rights Railway usage rights are carried at cost less accumulated amortisation. Amortisation is calculated using the straight-line basis over the period of operation of approximately 45 years. (k) Income taxes The tax expense for the year comprises current and deferred tax. Tax is recognised in the income statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively. The current tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting period in the countries where the group companies operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation and establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities. Deferred tax is provided in full, using the liabilities method, on temporary diff erences arising between the tax bases of assets and liabilities and their carrying amounts in the fi nancial statements. Deferred tax assets are recognised to the extent that it is probable that future taxable profi t will be available against which the temporary diff erences can be utilised. Deferred tax assets and liabilities are off set when there is a legally enforceable right to off set current tax assets against current tax liabilities and when the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority on either the taxable entity or diff erent taxable entities where there is an intention to settle the balances on a net basis. Pillar Two related top-up tax expenses are recognised and disclosed separately from other current income tax expenses. Qualifi ed domestic top-up tax expenses are recognised and presented as current income tax expenses by the relevant entities in the Group that have the legal obligation to settle qualifying domestic top-up taxes with the tax authorities. This includes the designated fi ling entity and any other entities that have elected to pay a portion of the qualifi ed domestic top-up tax expenses. (l) Investments Investments (other than investments in subsidiary companies, associated companies or joint ventures) are non-derivative equity fi nancial investments which are measured at fair value. Management is eligible to make an irrevocable election, on an instrument-by-instrument basis, on equity investments other than those held for trading, to present changes in fair value through profi t or loss or fair value through other comprehensive income (“FVOCI”). The Group has elected to measure as FVOCI, to which any fair value gains or losses accumulated in the revaluation reserve account will no longer be reclassifi ed to profi t or loss following the derecognition of such investment. Dividends from investments continued to be recognised as other operating income in the income statement when the right to receive payment is established. Impairment losses (and reversal of impairment losses) are not reported separately from other changes in fair value.
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