NOTES TO
FINANCIAL STATEMENTS
65
GDS Global Limited Annual Report 2015
As at 30 September 2015
2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)
Service and maintenance works
Revenue from service and maintenance works is recognised upon the completion of the services
rendered and acceptance by customers.
Interest income
Interest income is accrued on a time basis, by reference to the principal outstanding and at the
effective interest rate applicable.
Dividend income
Dividend income from investments is recognised when the shareholders’ rights to receive payment
have been established.
Rental income
The Group’s policy for recognition of revenue from operating leases is described above.
BORROWING COSTS - Borrowing costs directly attributable to the acquisition, construction or
production of qualifying assets, which are assets that necessarily take a substantial period of time
to get ready for their intended use or sale, are added to the cost of those assets, until such time
as the assets are substantially ready for their intended use or sale. Investment income earned on
the temporary investment of specific borrowings pending their expenditure on qualifying assets is
deducted from the borrowing costs eligible for capitalisation.
All other borrowing costs are recognised in profit or loss in the period in which they are incurred.
RETIREMENT BENEFIT COSTS - Payments to defined contribution retirement benefit plans are
charged as an expense when employees have rendered the services entitling them to the
contributions. Payments made to state-managed retirement benefit schemes, such as the
Singapore Central Provident Fund, are dealt with as payments to defined contribution plans where
the Group’s obligations under the plans are equivalent to those arising in a defined contribution
retirement benefit plan.
EMPLOYEE LEAVE ENTITLEMENT - Employee entitlements to annual leave are recognised when
they accrue to employees. A provision is made for the estimated liability for annual leave as a
result of services rendered by employees up to the end of the reporting period.
INCOME TAX - Income tax expense represents the sum of the tax currently payable and deferred
tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit
as reported in the consolidated statement of profit or loss and other comprehensive income
because it excludes items of income or expense that are taxable or deductible in other years and
it further excludes items that are not taxable or tax deductible. The Group’s liability for current
tax is calculated using tax rates (and tax laws) that have been enacted or substantively enacted in
countries where the Company and subsidiaries operate by the end of the reporting period.
