Overview Our Business
Strategic Review Corporate Governance
Financial Statements
Other Information
page
103
Notes to the Financial Statements
31 December 2015
3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(u) Revenue recognition (continued)
(i)
Telecommunications revenue
Revenues from mobile postpaid services and fixed line services are recognised when services are rendered for usage based billing
and on time proportion basis for fixed fee or time based billing. Service discounts and incentives are accounted for as a reduction of
revenue when granted.
Revenue from mobile prepaid services comprises sales of starter packs and prepaid top-up tickets. Revenue from sales of starter
packs is recognised at the point of sale to third parties while the revenue from the preloaded talk time within the pack is recognised
when services are rendered. Revenue from sales of prepaid top-up tickets is recognised when services are rendered. The credits
on preloaded talk time within the starter packs and prepaid top-up tickets can be deferred up to the point of customer churn or upon
expiry, after which such amounts are recognised as revenue.
Unutilised credits of prepaid top-up tickets sold to customers and distributors and unutilised airtime on certain postpaid rate plans
which have been deferred as described above are recognised as deferred income.
Revenues from the provision of network facilities, public switched services, Internet services and Internet application services are
recognised at the time of customer usage and when services are rendered. Service discounts and incentives are accounted as a
reduction of revenue when granted.
Revenue earned from carriers for international gateway services is recognised at the time the calls occur and when services are rendered.
Revenue from the sale of devices is recognised upon the transfer of significant risks and rewards of ownership of the goods to the
customer which generally coincides with delivery and acceptance of the goods sold.
Where the Group’s role in a transaction is that of a principal, revenue is recognised on a gross basis, representing the gross value of
the transaction billed to the customer, after trade discounts, with any related expenditure charged as an operating cost. Where the
Group’s role in a transaction is that of an agent, revenue is recognised on a net basis and represents the margin earned.
(ii)
Dividend income
Dividend income is recognised when the Group’s and the Company’s right to receive payment is established.
(iii)
Interest income
Interest income is recognised on a time proportion basis, taking into account the principal outstanding and the effective interest rate
over the period to maturity, when it is determined that such income will accrue to the Group and the Company.
(v) Government grants
As a Universal Service Provider (“USP”), the Group is entitled to claim certain qualified expenses from the relevant authorities in relation
to USP projects. The claim qualifies as a government grant and is recognised at its fair value where there is reasonable assurance that the
grant will be received and the Group will comply with all the attached conditions.
Government grants relating to costs are deferred and recognised in the statement of profit or loss over the financial period necessary to
match them with the costs they are intended to compensate.
Government grants relating to the purchase of assets are included in payables and accruals as government grant and are credited to the
statement of profit or loss on a straight-line basis over the expected useful lives of the related assets.
