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Bangkok Ranch Public Company Limited and its subsidiaries Report and consolidated and separate financial statements 31 December 2024
Independent Auditor's Report To the Shareholders of Bangkok Ranch Public Company Limited Opinion I have audited the accompanying consolidated financial statements of Bangkok Ranch Public Company Limited and its subsidiaries (the Group), which comprise the consolidated statement of financial position as at 31 December 2024, and the related consolidated statements of income, comprehensive income, changes in shareholders’ equity and cash flows for the year then ended, and notes to the consolidated financial statements, including material accounting policy information, and have also audited the separate financial statements of Bangkok Ranch Public Company Limited for the same period (collectively “the financial statements”). In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Bangkok Ranch Public Company Limited and its subsidiaries, and of Bangkok Ranch Public Company Limited as at 31 December 2024, their financial performance and cash flows for the year then ended in accordance with Thai Financial Reporting Standards. Basis for Opinion I conducted my audit in accordance with Thai Standards on Auditing. My responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of my report.
I am independent of the Group in accordance with the Code of Ethics for Professional Accountants including Independence Standards issued by the Federation of Accounting Professions (Code of Ethics for Professional Accountants) that are relevant to my audit of the financial statements, and I have fulfilled my other ethical responsibilities in accordance with the Code of Ethics for Professional Accountants. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion.
Key Audit Matters Key audit matters are those matters that, in my professional judgement, were of most significance in my audit of the financial statements of the current period. These matters were addressed in the context of my audit of the financial statements as a whole, and in forming my opinion thereon, and I do not provide a separate opinion on these matters. I have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of my report, including in relation to these matters. Accordingly, my audit included the performance of procedures designed to respond to my assessment of the risks of material misstatement of the financial statements. The results of my audit procedures, including the procedures performed to address the matters below, provide the basis for my audit opinion on the accompanying financial statements as a whole. Key audit matters and how audit procedures respond to each matter are described below. Revenue recognition Revenues from sales of the Group are a significant financial statement account due to their high amount.
In addition, the revenue of the Group is derived from a variety of products such as processed foods and by-products, farmed ducks and duck meat, animal feeds and day one ducks, which have a large number of domestic and overseas customers, and the prices vary according to the competitive situation. As a result, revenues from sales of the Group are recognised under different conditions and amounts for each type of product and customer. There are therefore risks with respect to the amount and timing of revenue recognition. I have examined the revenue recognition of the Group by assessing and testing the internal controls of the Group with respect to revenue cycle by making enquiry of responsible executives, gaining an understanding of the controls and selecting representative samples to test the operation of the designed controls and with special considerations given to testing related to the accuracy and timing of revenue recognition. On a sampling basis, examining supporting documents for sales transactions occurring during the year, near the end of the accounting period and after the period-end. In addition, I reviewed credit notes issued by the Group after the period-end and performed analytical procedures on disaggregated data to detect possible irregularities in sales transactions throughout the period, particularly for accounting entries made through journal vouchers.
2
Goodwill and trade name Because goodwill and trade name are intangible assets with indefinite useful lives, as discussed in Notes 17 and 18 to the financial statements, respectively, the assessment of impairment of goodwill and trade name is a significant accounting estimate requiring management to exercise a high degree of judgment in identifying the cash generating units, estimating the cash inflows that are expected to be generated from that group of assets in the future, and setting an appropriate discount rate and long-term growth rate. There are thus risks with respect to the amount of goodwill and trade name. I assessed the identification of cash generating units and the financial models selected by the management of the Group by gaining an understanding of management’s decision-making process assessing whether the decisions made were consistent with how assets are utilised. In addition, I tested the significant assumptions applied by the management in preparing estimates of the cash flows expected to be realised from the assets, by comparing those assumptions with information from both internal and external sources and comparing past cash flow projections to actual operating results in order to evaluate the exercise of management judgment in estimating the cash flow projections.
I also evaluate the discount rate applied by management through an analysis of the moving average finance costs of the Group and of the industry, tested the calculation of the realisable value of the goodwill and trade name using the selected financial models and considered the impact of changes in key assumptions on those realisable values, especially changes in the discount rate and long-term revenue growth rates. Moreover, I reviewed the disclosures made with respect to the impairment assessment for goodwill and trade name. Other Information Management is responsible for the other information. The other information comprise the information included in annual report of the Group, but does not include the financial statements and my auditor’s report thereon. The annual report of the Group is expected to be made available to me after the date of this auditor’s report. My opinion on the financial statements does not cover the other information and I do not express any form of assurance conclusion thereon. In connection with my audit of the financial statements, my responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or my knowledge obtained in the audit or otherwise appears to be materially misstated.
3
When I read the annual report of the Group, if I conclude that there is a material misstatement therein, I am required to communicate the matter to those charged with governance for correction of the misstatement. Responsibilities of Management and Those Charged with Governance for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with Thai Financial Reporting Standards, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so. Those charged with governance are responsible for overseeing the Group’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Financial Statements My objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes my opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Thai Standards on Auditing will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. As part of an audit in accordance with Thai Standards on Auditing, I exercise professional judgement and maintain professional skepticism throughout the audit. I also:
Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
4
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If I conclude that a material uncertainty exists, I am required to draw attention in my auditor’s report to the related disclosures in the financial statements or, if such disclosures information are inadequate, to modify my opinion. My conclusions are based on the audit evidence obtained up to the date of my auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the group to express an opinion on the consolidated financial statements. I am responsible for the direction, supervision and performance of the group audit. I remain solely responsible for my audit opinion.
I communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that I identify during my audit. I also provide those charged with governance with a statement that I have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on my independence, and where applicable, related safeguards.
5
From the matters communicated with those charged with governance, I determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. I describe these matters in my auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, I determine that a matter should not be communicated in my report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. I am responsible for the audit resulting in this independent auditor’s report.
Vilailak Laohasrisakul Certified Public Accountant (Thailand) No. 6140 EY Office Limited Bangkok: 27 February 2025
6
Bangkok Ranch Public Company Limited and its subsidiaries Statement of financial position As at 31 December 2024 (Unit: Baht) Consolidated financial statements
Separate financial statements
Note
2024
2023
2024
2023
Cash and cash equivalents
7
174,297,378
205,546,590
79,486,161
150,364,836
Trade and other receivables
8
657,791,449
657,237,291
1,899,115,410
1,737,965,652
Short-term loans to related party
6
4,251,408
4,564,008
-
-
6
-
2,442,630
-
-
Assets Current assets
Current portion of long-term loan to related party Current portion of long-term loans 12
3,867,597
4,151,954
-
-
Short-term loan to other company
9
16,297,064
-
-
-
Inventories
10
1,607,894,892
1,599,892,580
858,082,951
784,278,559
Current biological assets
11
160,025,797
135,479,032
140,919,550
58,532,643
87,087,811
85,815,494
87,061,234
85,815,494
to other companies
Other current financial assets Other current assets
42,721,629
49,775,139
6,310,885
6,449,209
Total current assets
2,754,235,025
2,744,904,718
3,070,976,191
2,823,406,393
11
171,838,253
173,557,177
139,599,093
126,509,169
6
3,692,464
-
-
-
12
39,177,425
46,443,014
-
-
4,122,032
5,002,308
2,243
2,308
Non-current assets Non-current biological assets Long-term loan to related party, net of current portion Long-term loans to other companies, net of current portion Other non-current financial assets Investments in subsidiaries
13
-
-
2,116,643,475
2,116,643,475
Investments in joint ventures
14
208,291,528
204,896,342
250,764,700
250,764,700
Investment properties
15
137,415,546
60,225,034
142,527,442
70,635,700
Property, plant and equipment
16
4,443,374,413
4,760,078,172
1,471,525,871
1,604,799,239
Right-of-use assets
22
70,199,689
40,381,049
98,976,386
29,942,742
Goodwill
17
1,877,910,554
1,880,590,602
1,838,483,342
1,838,483,342
Intangible assets
18
616,130,998
628,416,776
507,911,032
520,451,891
Deferred tax assets
29
178,228,662
218,828,177
157,155,121
213,281,620
Other non-current assets
3,796,028
4,214,595
3,796,028
3,770,638
Total non-current assets
7,754,177,592
8,022,633,246
6,727,384,733
6,775,284,824
Total assets
10,508,412,617
10,767,537,964
9,798,360,924
9,598,691,217
The accompanying notes are an integral part of the financial statements.
Bangkok Ranch Public Company Limited and its subsidiaries Statement of financial position (continued) As at 31 December 2024 (Unit: Baht) Consolidated financial statements
Separate financial statements
Note
2024
2023
2024
2023
Liabilities and shareholders' equity Current liabilities Bank overdrafts and short-term loans from financial institutions
19
1,995,243,855
1,897,472,650
1,629,748,720
1,479,143,702
Trade and other payables
20
552,831,978
492,128,416
563,360,796
457,216,262
Current portion of long-term loans
21
493,002,175
713,895,208
457,464,000
672,944,000
Current portion of lease liabilities
22
21,636,587
21,005,000
39,647,301
14,015,006
161,391
23,473,000
-
-
Income tax payable Other current financial liabilities
644,737
274,197
638,878
274,197
Other current liabilities
37,639,594
28,163,396
27,616,720
23,048,205
Total current liabilities
3,101,160,317
3,176,411,867
2,718,476,415
2,646,641,372
Non-current liabilities Long-term loans, net of current portion
21
2,314,519,911
2,548,579,566
2,205,318,724
2,393,197,724
Lease liabilities, net of current portion
22
49,505,697
20,739,862
60,862,563
17,107,878
Long-term loans from related person
6
10,731,248
11,300,332
-
-
Provision for long-term employee benefits
23
142,314,741
108,926,343
120,468,609
80,285,441
-
23,098,129
-
23,098,129
145,478,411
140,380,748
120,503,049
115,035,936
Deposit for agro credit sales Defered tax liabilities Other non-current liabilities
29
617,341
1,000
1,000
1,000
Total non-current liabilities
2,663,167,349
2,853,025,980
2,507,153,945
2,628,726,108
Total liabilities
5,764,327,666
6,029,437,847
5,225,630,360
5,275,367,480
The accompanying notes are an integral part of the financial statements.
Bangkok Ranch Public Company Limited and its subsidiaries Statement of financial position (continued) As at 31 December 2024 (Unit: Baht) Consolidated financial statements Note
Separate financial statements
2024
2023
2024
2023
6,850,849,185
6,850,849,185
6,850,849,185
6,850,849,185
Shareholders' equity Share capital Registered 1,370,169,837 ordinary shares of Baht 5 each Issued and fully paid 4,567,232,790
4,567,232,790
4,567,232,790
4,567,232,790
Share premium
913,446,558 ordinary shares of Baht 5 each
4,234,237,492
4,234,237,492
4,234,237,492
4,234,237,492
Share discount
(400,000,000)
(400,000,000)
(400,000,000)
(400,000,000)
(7,431,241,496)
(7,431,241,496)
(6,557,910,481)
(6,557,910,481)
24
Deficit on amalgamation Retained earnings
25
Appropriated - statutory reserve
282,970,800
264,720,800
278,720,800
264,720,800
3,587,456,307
3,514,358,157
2,450,450,101
2,215,043,209
Other components of shareholders' equity
(93,374,092)
(11,737,040)
(138)
(73)
Equity attributable to owners of the Company
4,747,281,801
4,737,570,703
4,572,730,564
4,323,323,737
(3,196,850)
529,414
-
-
Unappropriated
Non-controlling interests of the subsidiaries Total shareholders' equity
4,744,084,951
4,738,100,117
4,572,730,564
4,323,323,737
Total liabilities and shareholders' equity
10,508,412,617
10,767,537,964
9,798,360,924
9,598,691,217
-
-
-
-
The accompanying notes are an integral part of the financial statements.
Directors
Bangkok Ranch Public Company Limited and its subsidiaries Income statement For the year ended 31 December 2024 (Unit: Baht) Consolidated financial statements Note
2024
2023
Separate financial statements 2024
2023
Revenues Sales
7,385,706,399
8,000,388,814
5,353,811,271
5,116,962,918
-
-
84,999,150
148,240,213
Other income
35,028,651
33,673,132
58,133,312
59,577,264
Total revenues
7,420,735,050
8,034,061,946
5,496,943,733
5,324,780,395
5,932,484,879
6,363,830,244
4,205,288,950
4,152,319,007
Selling and distribution expenses
406,687,559
405,261,077
305,516,087
244,303,395
Administrative expenses
628,356,144
559,962,957
383,060,221
300,995,067
Total expenses
6,967,528,582
7,329,054,278
4,893,865,258
4,697,617,469
Operating profit
453,206,468
705,007,668
603,078,475
627,162,926
14
3,399,867
6,764,605
-
-
627,355
964,037
602,146
918,223
27
(286,781,174)
(282,282,840)
(255,015,893)
(254,919,283)
170,452,516
430,453,470
348,664,728
373,161,866
Dividend income
13
Expenses Cost of sales
Share of profit from joint venture Finance income Finance cost Profit before income tax expenses Income tax expenses
29
Profit for the year
(53,047,875)
(135,753,363)
(69,126,456)
(56,538,653)
117,404,641
294,700,107
279,538,272
316,623,213
121,479,530
300,363,813
279,538,272
316,623,213
0.31
0.35
Profit (loss) attributable to: Equity holders of the Company Non-controlling interests of the subsidiary
Earnings per share
(4,074,889)
(5,663,706)
117,404,641
294,700,107
0.13
0.33
31
Basic earnings per share Profit attributable to equity holders of the Company
The accompanying notes are an integral part of the financial statements.
Bangkok Ranch Public Company Limited and its subsidiaries Statement of comprehensive income For the year ended 31 December 2024 (Unit: Baht) Consolidated financial statements Note
2024
2023
Separate financial statements 2024
279,538,272
316,623,213
31,571,799
-
-
(81,120)
-
-
(81,288,362)
31,490,679
-
-
(65)
(90)
(65)
(90)
(30,131,380)
-
(30,131,380)
-
(30,131,445)
(90)
(30,131,445)
(90)
Other comprehensive income for the year
(111,419,807)
31,490,589
(30,131,445)
(90)
Total comprehensive income for the year
5,984,834
326,190,696
249,406,827
316,623,123
Equity holders of the Company
9,711,098
333,493,826
249,406,827
316,623,123
Non-controlling interests of the subsidiary
(3,726,264)
(7,303,130)
5,984,834
326,190,696
Profit for the year
117,404,641
294,700,107
(81,283,682) (4,680)
2023
Other comprehensive income: Other comprehensive income to be reclassified to profit or loss in subsequent periods: Exchange differences on translation of financial statements in foreign currency Share of other comprehensive income from joint venture
14
Other comprehensive income to be reclassified to profit or loss in subsequent periods
Other comprehensive income not to be reclassified to profit or loss in subsequent periods: Loss on changes in value of equity investments designated at fair value through other comprehensive income - net of income tax Actuarial loss, net of income tax
23, 29
Other comprehensive income not to be reclassified to profit or loss in subsequent periods - net of income tax
Total comprehensive income attributable to:
The accompanying notes are an integral part of the financial statements.
Bangkok Ranch Public Company Limited and its subsidiaries Cash flow statement For the year ended 31 December 2024 (Unit: Baht) Consolidated financial statements 2024
2023
Separate financial statements 2024
2023
Cash flows from operating activities Profit before tax
170,452,516
430,453,470
348,664,728
373,161,866
Adjustments to reconcile profit before tax to net cash provided by (paid from) operating activities: Depreciation
349,558,033
348,546,830
178,386,584
176,376,024
Other amortisations
14,950,406
15,178,865
12,617,331
12,633,258
Impairment loss on financial assets (reversal)
(26,753,684)
(3,028,369)
(1,356,215)
854,928
Reversal of reduction of inventory to net realisable value
(1,430,021)
(15,155,297)
(1,896,811)
(17,936,273)
Reversal of allowance for impairment loss on other investment
(2,184,389)
-
-
-
Share of profit from joint ventures
(3,399,867)
(6,764,605)
-
-
Provision for long-term employee benefits
24,689,868
31,003,849
5,313,034
5,492,370
(148,153)
(42,140)
-
(27,459)
(Gain) loss on sales/write-off of equipment
(2,807,132)
76,048
(454,970)
75,927
Loss on write-off of investment properties
-
-
-
175
1,765,960
175,795
(2,724,105)
5,741,413
(901,777)
375,695
(881,059)
228,443
(24,978,316)
(13,533,317)
(30,200,209)
6,782,060
-
-
(84,999,150)
(148,240,213)
Difference on lease termination
Unrealised (gain) loss on exchange (Gain) loss arising from fair value adjustments of financial assets and liabilities (Gain) loss arising from change in fair value of biological assets and agricultural produce Dividend income Finance income
(627,355)
(964,037)
(602,146)
(918,223)
286,781,174
282,282,840
255,015,893
254,919,283
784,967,263
1,068,605,627
676,882,905
669,143,579
Trade and other receivables
24,495,906
94,510,421
(161,848,586)
(421,914,512)
Inventories
(6,572,291)
(295,938,976)
(71,907,581)
(68,977,483)
Other current assets
7,049,258
1,780,466
(306,350)
1,373,576
Biological assets
2,150,475
(41,048,127)
(65,276,622)
(4,932,063)
418,567
(370,237)
(25,390)
73,720
Trade and other payables
60,620,824
(78,599,954)
111,111,777
(176,930,189)
Other current liabilities
9,476,198
(9,395,493)
4,568,515
1,004,976
(27,706,177)
(23,240,558)
(2,794,090)
(209,540)
Finance cost Profit from operating activities before changes in operating assets and liabilities Operating assets (increase) decrease
Other non-current assets Operating liabilities increase (decrease)
Paid for long-term employee benefits Other non-current liabilities
(22,481,788)
2,273,567
(23,098,129)
2,273,567
Cash from operating activities
832,418,235
718,576,736
467,306,449
905,631
(286,759,458)
(281,382,434)
(255,175,666)
(253,810,451)
(25,807,474)
(136,246,290)
(1,349,594)
(1,301,960)
519,851,303
300,948,012
210,781,189
(254,206,780)
Interest paid Corporate income tax paid and withholding tax deducted at source Net cash from (used in) operating activities
The accompanying notes are an integral part of the financial statements.
Bangkok Ranch Public Company Limited and its subsidiaries Cash flow statement (continued) For the year ended 31 December 2024 (Unit: Baht) Consolidated financial statements 2024
2023
Separate financial statements 2024
2023
Cash flows from investing activities Decrease (increase) in long-term loans to related party
(1,417,136)
2,282,004
-
-
Decrease (increase) in long-term loans to other companies
7,549,946
(64,286,992)
-
-
Increase in short-term loans to other company
(16,297,064)
-
-
-
Acquisitions of property, plant and equipment
(148,896,280)
(539,749,571)
(89,914,120)
(28,910,426)
Proceeds from sales of plant and equipment
9,603,128
810,648
507,438
202,758
Cash paid for acquisition of intangible assets
(3,058,091)
(3,532,461)
(76,472)
(331,153)
Net cash flows from disposal of other non-current financial asset
-
-
-
5,000,000
Proceeds from sales of other investment
3,064,600
-
-
-
Interest received
2,393,300
823,821
2,368,091
778,007
-
-
84,999,150
148,240,213
(147,057,597)
(603,652,551)
(2,115,913)
124,979,399
97,771,205
206,469,133
150,605,018
3,586,855
-
236,456,208
-
226,225,224
204,903
5,016,872
-
-
Dividend received from subsidiary Net cash from (used in) investing activities Cash flows from financing activities Increase in bank overdrafts and short-term loans from financial institutions Cash receipt from long-term loans Cash receipt from long-term loan from related person Payment of principal portion of lease liabilities
(21,593,669)
(25,271,049)
(26,789,969)
(13,910,491)
Repayment of long-term loans
(441,505,361)
(492,162,399)
(403,359,000)
(449,684,000)
Net cash used in financing activities
(365,122,922)
(69,491,235)
(279,543,951)
(233,782,412)
Increase (decrease) in translation adjustments
(38,919,996)
35,735,358
-
-
Net decrease in cash and cash equivalents
(31,249,212)
(336,460,416)
(70,878,675)
(363,009,793)
Cash and cash equivalents at beginning of year
205,546,590
542,007,006
150,364,836
513,374,629
Cash and cash equivalents at end of year
174,297,378
205,546,590
79,486,161
150,364,836
-
-
-
-
53,435,285
13,784,793
96,176,949
9,347,444
-
85,500,000
-
85,500,000
76,938,032
-
74,075,116
6,225,020
Supplemental cash flow information : Non-cash transaction Increase in right-of-use assets from new lease contracts Transfer other non-current financial assets to other current financial assets Transfer property plant and equipment to investment properties
The accompanying notes are an integral part of the financial statements.
Bangkok Ranch Public Company Limited and its subsidiaries Statement of changes in shareholders' equity For the year ended 31 December 2024
-
300,363,813
3,229,994,344
Unappropriated
33,211,223
-
(45,533,167)
in foreign currency
financial statements
translation of
-
33,211,223
differences on
-
793,728
793,728
-
(81,120)
(81,120)
-
874,848
from joint venture
income
-
comprehensive
Share of other
(65)
(208,824)
(208,824)
-
(90)
-
(208,734)
Fair value
-
(90)
reserve
-
(81,637,052)
(81,637,052)
(11,737,040)
-
-
33,130,013
33,130,013
-
(44,867,053)
shareholders'
components of
Total other
-
(11,737,040)
equity
-
(111,768,432)
121,479,530
4,737,570,703
4,737,570,703
33,130,013
4,404,076,877
Total equity
-
300,363,813
attributable to
-
333,493,826
owners of
-
9,711,098
the Company
-
-
(3,726,264)
348,625
(4,074,889)
529,414
529,414
3,716,733
-
(7,303,130)
(1,639,424)
(5,663,706)
4,115,811
the subsidiaries
interests of
-
to non-controlling
Equity attributable
(111,419,807)
117,404,641
4,738,100,117
4,738,100,117
3,716,733
31,490,589
294,700,107
4,408,192,688
Total
-
326,190,696
equity
-
5,984,834
shareholders'
-
(Unit: Baht)
statutory
-
248,720,800
reserve
-
(16,000,000)
300,363,813
(12,321,944)
-
(65)
-
Total comprehensive income for the year
Other comprehensive income for the year
Profit (loss) for the year
Balance as at 1 January 2024
Balance as at 31 December 2023
Transfer to statutory reserve (Note 25)
Total comprehensive income for the year
Other comprehensive income for the year
Profit (loss) for the year
-
-
-
-
-
4,567,232,790
4,567,232,790
-
-
-
-
-
-
-
-
4,234,237,492
4,234,237,492
-
-
-
-
-
-
(400,000,000)
-
-
-
-
-
-
Decrease in non-controlling interests
Other components of shareholders' equity
amalgamation
-
-
(12,321,944)
(4,680)
-
Transfer to statutory reserve (Note 25)
of the subsidiary from changes in
Consolidated financial statements Equity attributable to owners of the Company
-
(7,431,241,496)
Deficit on
-
16,000,000
3,514,358,157
-
(4,680)
-
4,744,084,951
Transfer to statutory reserve of the subsidiary
interests of investment
Other comprehensive income
Share
-
-
(81,632,307)
-
(3,196,850)
Exchange
Share
-
(400,000,000)
discount
-
-
264,720,800
3,514,358,157
(81,632,307)
-
4,747,281,801
Retained earnings
paid-up
4,234,237,492
premium
-
-
-
264,720,800
(30,131,380)
121,479,530
-
(93,374,092)
Appropriated -
share capital
-
-
(7,431,241,496)
-
91,348,150
-
(208,889)
Issued and
4,567,232,790
-
-
-
(4,250,000)
(14,000,000)
789,048
(7,431,241,496)
Balance as at 1 January 2023
-
-
-
(400,000,000)
(7,431,241,496)
4,250,000
14,000,000
(93,954,251)
(400,000,000)
-
3,587,456,307
4,234,237,492
282,970,800
4,567,232,790
Balance as at 31 December 2024
The accompanying notes are an integral part of the financial statements.
Bangkok Ranch Public Company Limited and its subsidiaries Statement of changes in shareholders' equity (continued) For the year ended 31 December 2024
Separate financial statements
4,567,232,790
share capital
-
-
-
-
-
4,234,237,492
Share premium
-
-
-
-
(400,000,000)
Share discount
Deficit on
-
-
-
(6,557,910,481)
amalgamation
-
264,720,800
16,000,000
reserve
-
-
248,720,800
statutory
-
Appropriated -
279,538,272
2,215,043,209
2,215,043,209
(16,000,000)
316,623,213
-
316,623,213
1,914,419,996
Unappropriated
reserve
Fair value
(73)
-
(90)
(90)
-
17
comprehensive income
Other
-
(73)
equity
-
(90)
(90)
-
17
components of
Total other
(73)
shareholders'
-
(73)
279,538,272
4,323,323,737
4,323,323,737
4,006,700,614
equity
Total
(90)
316,623,213
shareholders'
-
316,623,123
(Unit: Baht)
Profit for the year
-
(6,557,910,481)
-
264,720,800
Other components of shareholders' equity
Other comprehensive income for the year
-
-
(400,000,000)
-
(6,557,910,481)
Retained earnings
Total comprehensive income for the year
4,234,237,492
-
(400,000,000)
Issued and
Transfer to statutory reserve (Note 25) 4,567,232,790
-
4,234,237,492
Other comprehensive income for the year
-
-
-
-
-
-
-
-
(6,557,910,481)
-
-
-
278,720,800
14,000,000
-
-
2,450,450,101
(14,000,000)
249,406,892
(30,131,380)
(138)
-
(65)
(65)
(138)
-
(65)
(65)
4,572,730,564
-
249,406,827
(30,131,445)
paid-up
Balance as at 31 December 2023
-
4,567,232,790
Balance as at 1 January 2023
Balance as at 1 January 2024
Total comprehensive income for the year
-
(400,000,000)
Profit for the year
Transfer to statutory reserve (Note 25)
4,234,237,492
-
4,567,232,790
Balance as at 31 December 2024
The accompanying notes are an integral part of the financial statements.
Bangkok Ranch Public Company Limited and its subsidiaries Notes to financial statements For the year ended 31 December 2024 1.
General information Bangkok Ranch Public Company Limited (“the Company”) is a public company which was established via an amalgamation under civil and commercial law between Bangkok Ranch Public Company Limited, Thongchai Asia Limited, Middle Village Limited and BT Partners Limited on 15 July 2013 and domiciled in Thailand. Its major shareholders are BR Partners Limited, which was incorporated in Hong Kong SAR, and JRGG Limited, which was incorporated in Thailand. The Company is principally engaged in the production of animal feed, farms for breeding and raising ducks for meat, duck slaughtering and the production of processed foods and by-products for distribution in local and overseas markets. The Company runs the duck farms, hatcheries, feed mills and distribution center located in Chonburi, Rayong, Singburi, Udonthani, Petchabun, Sa Kaeo, Chachoengsao and Chiang Mai. Its registered address is at No. 18/1 Moo 12, Sai Langwatbangpleeyainai Road, Bangpleeyai, Bangplee, Samutprakarn.
2.
Basis of preparation
2.1
The financial statements have been prepared in accordance with Thai Financial Reporting Standards enunciated under the Accounting Professions Act B.E. 2547 and their presentation has been made in compliance with the stipulations of the Notification of the Department of Business Development, issued under the Accounting Act B.E. 2543. The financial statements in Thai language are the official statutory financial statements of the Company. The financial statements in English language have been translated from the Thai language financial statements. The financial statements have been prepared on a historical cost basis except where otherwise disclosed in the accounting policies.
2.2
Basis of consolidation a)
The consolidated financial statements include the financial statements of Bangkok Ranch Public Company Limited (“the Company”) and the following subsidiary companies (“the subsidiaries”) (collectively as “the Group”):
1
Country of Company’s name
Nature of business
Percentage of shareholding
incorporation
2024
2023
%
%
100
100
Thailand
Held by the Company Anatis Foods Limited
Holding business and international
BR Agriculture Co., Ltd.
Duck farming business
100
100
Thailand
BM Agriculture Co., Ltd.
Raising duck for meat business
48
48
Thailand
Crown Eagle Co., Ltd.
Restaurant
100
100
Thailand
BR Investment (Hong Kong) Co., Ltd.
Not yet operational
100
100
Hong Kong SAR
NS Delicatessen Co., Ltd.
Food processing
100
100
Thailand
Winthai Food Co., Ltd.
Slaughterhouse and duck meats trading
100
100
Thailand
Anatis Foods (Hong Kong) Limited
Duck meats trading
100
100
Hong Kong SAR
Anatis Foods (Singapore) Pte. Ltd.
Duck meats trading
100
100
Singapore
Duck-To Holding B.V.
Holding business
100
100
The Netherlands
Win Thai Food (Cambodia) Co., Ltd.
Not yet operational
100
100
Cambodia
Imports and wholesale grains for ducks
60
60
Thailand
Tomassen Duck-To B.V.
Slaughterhouse and duck meats trading
100
100
The Netherlands
Duck-To Farm B.V.
Duck farming business
100
100
The Netherlands
Canature B.V.
Not yet operational
100
100
The Netherlands
Duck-To Kosovo Sh.P.K.
Not yet operational
100
100
Republic of Kosovo
Lucky Duck International Food B.V.
Food processing
100
100
The Netherlands
Weng Fat Poultry (Kosovo) Sh.P.K.
Food processing
65
65
Republic of Kosovo
business center
Held by Anatis Foods Limited
Held by Crown Eagle Co., Ltd. North Star Food Co., Ltd. Held by Duck-To Holding B.V.
Held by Tomassen Duck-To B.V.
b)
The Company is deemed to have control over an investee or subsidiaries if it has rights, or is exposed, to variable returns from its involvement with the investee, and it has the ability to direct the activities that affect the amount of its returns.
c)
Subsidiaries are fully consolidated, being the date on which the Company obtains control, and continue to be consolidated until the date when such control ceases.
d)
The financial statements of the subsidiaries are prepared using the same significant accounting policies as the Company.
e)
The assets and liabilities in the financial statements of overseas subsidiary companies are translated to Baht using the exchange rate prevailing on the end of reporting period, and revenues and expenses translated using monthly average exchange rates. The resulting differences are shown under the caption of “Exchange differences on translation of financial statements in foreign currency” in the statements of changes in shareholders’ equity.
f)
Material balances and transactions between the Group have been eliminated from the consolidated financial statements. 2
g)
Non-controlling interests represent the portion of profit or loss and net assets of the subsidiaries that are not held by the Company and are presented separately in the consolidated profit or loss and within equity in the consolidated statement of financial position.
2.3
The separate financial statements present investments in subsidiaries and joint ventures under the cost method.
3.
New financial reporting standards
3.1
Financial reporting standards that became effective in the current year During the year, the Group has adopted the revised financial reporting standards which are effective for fiscal years beginning on or after 1 January 2024. These financial reporting standards were aimed at alignment with the corresponding International Financial Reporting Standards with most of the changes directed towards clarifying accounting treatment and providing accounting guidance for users of the standards. The adoption of these financial reporting standards does not have any significant impact on the Group’s financial statements.
3.2
Financial reporting standards that will become effective for fiscal years beginning on or after 1 January 2025 The Federation of Accounting Professions issued a number of revised financial reporting standards, which are effective for fiscal years beginning on or after 1 January 2025. These financial reporting standards were aimed at alignment with the corresponding International Financial Reporting Standards with most of the changes directed towards clarifying accounting treatment and providing accounting guidance for users of the standards. The management of the Group believes that adoption of these amendments will not have any significant impact on the Group’s financial statements.
3
4.
Accounting policies
4.1
Revenue and expense recognition Sales of goods Revenue from sale of goods is recognised at the point in time when control of the asset is transferred to the customer, generally upon delivery of the goods. Revenue is measured at the amount of the consideration received or receivable, excluding value added tax, of goods supplied after deducting returns, discounts, allowances and price promotions to customers. Interest income Interest income is calculated using the effective interest method and recognised on an accrual basis. The effective interest rate is applied to the gross carrying amount of a financial asset. Finance cost Interest expense from financial liabilities at amortised cost is calculated using the effective interest method and recognised on an accrual basis. Dividends Dividends are recognised when the right to receive the dividends is established.
4.2
Cash and cash equivalents Cash and cash equivalents consist of cash in hand and at banks, and all highly liquid investments with an original maturity of three months or less and not subject to withdrawal restrictions.
4.3
Inventories Finished goods and work in process are valued at the lower of cost (under the first-in, first-out method) and net realisable value. The cost of inventories is measured using the standard cost method, which approximates actual cost and includes all production costs and attributable factory overheads. Raw materials, chemicals, spare parts and factory supplies are valued at the lower of cost (under the first-in, first-out method) and net realisable value and are charged to production costs whenever consumed.
4.4
Investments in subsidiaries and joint ventures Investments in joint ventures are accounted for in the consolidated financial statements using the equity method. Investments in subsidiaries and joint ventures are accounted for in the separate financial statements using the cost method.
4
4.5
Investment properties Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment properties are stated at cost less accumulated depreciation and allowance for loss on impairment (if any). Depreciation of investment properties, which is building for rent, is calculated by reference to their costs on the straight-line basis over estimated useful lives of 5 - 16 years. Depreciation of the investment properties is included in determining income. On disposal of investment properties, the difference between the net disposal proceeds and the carrying amount of the asset is recognised in profit or loss in the period when the asset is derecognised.
4.6
Property, plant and equipment / Depreciation Land is stated at cost. Buildings and equipment are stated at cost less accumulated depreciation and allowance for loss on impairment of assets (if any). Depreciation of land improvements, buildings and equipment is calculated by reference to their costs on a straight-line basis over the following estimated useful lives: Estimated useful lives The Company
The subsidiaries
20 years
20 years
20 - 40 years
10 - 40 years
10 years
5 - 20 years
2 - 10 years
3 - 5 years
Furniture, fixtures and office equipment
5 years
5 years
Motor vehicles
5 years
5 years
Land improvements Building and building improvements Machinery Tools and equipment
Depreciation is included in determining income. No depreciation is provided on land and assets under installation and under construction. An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on disposal of an asset is included in profit or loss when the asset is derecognised. 4.7
Borrowing costs Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalised as part of the cost of the respective assets. All other borrowing costs are expensed in the period they are incurred. Borrowing costs consist of interest and other costs that incur in connection with the borrowing of funds. 5
4.8
Biological assets The Group’s biological assets is ducklings, parent ducks, grandparent ducks and agricultural produce consists of eggs in hatcheries and day-old ducks which were measured at their fair value less costs to sell and fair value less costs to sell at the point of harvest, respectively. The Group classifies the biological assets that have production cycle shorter than 1 year as current biological assets and classifies the biological assets that have production cycle longer than 1 year as non-current biological assets. The fair value of ducklings is determined with reference to price of mature commercial duck. The fair value of eggs in hatcheries is determined based on reference to fair value of day-old ducks less hatchery costs and estimated point-of-harvest costs. The fair value of parent ducks and grandparent ducks is determined based on discounted cash flows. Gains or losses on changes in fair values of biological assets and agricultural produce are recognised in profit or loss. If fair value cannot be measured reliably, this biological assets is measured at its cost less any accumulated depreciation and accumulated impairment losses. Once the fair value of such a biological assets becomes reliably measurable, the Group will measure it at its fair value less costs to sell.
4.9
Intangible assets Intangible assets acquired through business combination are initially recognised at their fair value on the date of business acquisition while intangible assets acquired in other cases are recognised at cost. Following the initial recognition, the intangible assets are carried at cost less any accumulated amortisation and any accumulated impairment losses (if any). Intangible assets with finite useful lives are amortised on the straight-line basis over the economic useful life and tested for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method of such intangible assets are reviewed at least at each financial year end. The amortisation expense is charged to profit or loss. A summary of the intangible assets with finite useful lives is as follows: Useful lives Customer relationships
40
years
Computer software
3, 5
years
Intangible assets with indefinite useful lives are trade names. Intangible assets with indefinite useful lives are not amortised, but are tested for impairment annually either individually or at the cash-generating unit level. The assessment of indefinite useful lives of the intangible assets is reviewed annually.
6
4.10 Goodwill Goodwill is initially recorded at cost, which equals to the excess of cost of business combination over the fair value of the net assets acquired. If the fair value of the net assets acquired exceeds the cost of business combination, the excess is immediately recognised as gain in profit or loss. Goodwill is carried at cost less any impairment losses (if any). Goodwill is tested for impairment annually and when circumstances indicate that the carrying value may be impaired. For the purpose of impairment testing, goodwill acquired in a business combination is allocated to each of the cash generating units of the Group (or group of cash-generating units) that are expected to benefit from the synergies of the combination. The Group estimates the recoverable amount of each cash-generating unit (or group of cash-generating units) to which the goodwill relates. Where the recoverable amount of the cash-generating unit is less than the carrying amount, an impairment loss is recognised in profit or loss. Impairment losses relating to goodwill cannot be reversed in future periods. 4.11 Leases At inception of contract, the Group assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.
The Group as a lessee The Group applied a single recognition and measurement approach for all leases, except for short-term leases and leases of low-value assets. At the commencement date of the lease (i.e. the date the underlying asset is available for use), the Group recognises rightof-use assets representing the right to use underlying assets and lease liabilities based on lease payments. Right-of-use assets Right-of-use assets are measured at cost, less accumulated depreciation, any accumulated impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities initially recognised, initial direct costs incurred, and lease payments made at or before the commencement date of the lease less any lease incentives received.
7
Depreciation of right-of-use assets are calculated by reference to their costs, on the straight-line basis over the shorter of their estimated useful lives and the lease term. Land and land improvement
5
years
Buildings and building improvement
3
years
Machinery and equipment
5
years
Motor vehicles
5
years
If ownership of the leased asset is transferred to the Group at the end of the lease term or the cost reflects the exercise of a purchase option, depreciation is calculated using the estimated useful life of the asset. Lease liabilities Lease liabilities are measured at the present value of the lease payments to be made over the lease term. The lease payments include fixed payments less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected to be payable under residual value guarantees. Moreover, the lease payments include the exercise price of a purchase option reasonably certain to be exercised by the Group and payments of penalties for terminating the lease, if the lease term reflects the Group exercising an option to terminate. Variable lease payments that do not depend on an index or a rate are recognised as expenses in the period in which the event or condition that triggers the payment occurs. The Group discounted the present value of the lease payments by the interest rate implicit in the lease or the Group’s incremental borrowing rate. After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made.
In addition, the carrying amount of lease liabilities is remeasured if there is a change in the lease term, a change in the lease payments or a change in the assessment of an option to purchase the underlying asset. Short-term leases and leases of low-value assets A lease that has a lease term less than or equal to 12 months from commencement date or a lease of low-value assets is recognised as expenses on a straight-line basis over the lease term. The Company as a lessor A lease is classified as an operating lease if it does not transfer substantially all the risks and rewards incidental to ownership of an underlying asset to a lessee. Lease receivables from operating leases is recognised as income in profit or loss on a straightline basis over the lease term. Initial direct costs incurred in obtaining an operating lease are added to the carrying amount of the underlying assets and recognised as an expense over the lease term on the same basis as the lease income. 8
4.12 Related party transactions Related parties comprise individuals or enterprises that control, or are controlled by, the Company, whether directly or indirectly, or which are under common control with the Company. They also include associates, and individuals or enterprises which directly or indirectly own a voting interest in the Company that gives them significant influence over the Company, key management personnel, directors and officers with authority in the planning and direction of the operations of the Company. 4.13 Foreign currencies The consolidated and separate financial statements are presented in Baht, which is also the Company’s functional currency. Items included in the consolidated financial statements of each entity are measured using that functional currency. Transactions in foreign currencies are translated into Baht at the exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated into Baht at the exchange rate ruling at the end of reporting period. Gains and losses on exchange are included in determining income.
4.14 Impairment of non-financial assets At each reporting date, the Group performs impairment reviews in respect of the property, plant and equipment, right-of-use assets, investment properties and other intangible assets whenever events or changes in circumstances indicate that an asset may be impaired. The Group also carries out annual impairment reviews in respect of goodwill and intangible assets with indefinite useful lives. An impairment loss is recognised when the recoverable amount of an asset, which is the higher of the asset’s fair value less costs to sell and its value in use, is less than the carrying amount. In determining value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs to sell, an appropriate valuation model is used. These calculations are corroborated by a valuation model that, based on information available, reflects the amount that the Group could obtain from the disposal of the asset in an arm’s length transaction between knowledgeable, willing parties, after deducting the costs of disposal. An impairment loss is recognised in profit or loss.
9
In the assessment of asset impairment (except for goodwill), if there is any indication that previously recognised impairment losses may no longer exist or may have decreased, the Group estimates the asset’s recoverable amount. A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the asset’s recoverable amount since the last impairment loss was recognised. The increased carrying amount of the asset attributable to a reversal of an impairment loss shall not exceed the carrying amount that would have been determined having no impairment loss been recognised for the asset in prior years. Such reversal is recognised in profit or loss. 4.15 Employee benefits Short-term employee benefits Salaries, wages, bonuses and contributions to the social security fund are recognised as expenses when incurred. Post-employment benefits and other long-term employee benefit plan Defined contribution plans The Group and its employees have participated in a provident fund. The fund is monthly contributed by employees and by the Group. The fund’s assets are held in a separate trust fund and the contributions of the Group are recognised as expenses when incurred.
Defined Post-employment benefit plans and other long-term employee benefit plan The Group has obligations in respect of the severance payments it must make to employees upon retirement under labor law. The Group treats these severance payment obligations as a defined benefit plan. In addition, the subsidiaries provide other long-term employee benefit plan, namely long service awards and paid annual leave. The obligation under the defined benefit plan is determined by a professionally qualified independent actuary based on actuarial techniques, using the projected unit credit method. Actuarial gains and losses arising from defined benefit plans are recognised immediately in other comprehensive income. Past service costs are recognised in profit or loss on the earlier of the date of the plan amendment or curtailment and the date that the Group recognises restructuring-related costs. 4.16 Provisions Provisions are recognised when the Group has a present obligation as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.
10
4.17 Income tax Income tax expense represents the sum of corporate income tax currently payable and deferred tax. Current tax Current income tax of the Group in Thailand is provided in the accounts at the amount expected to be paid to the taxation authorities, based on taxable profits determined in accordance with tax legislation of Thailand. Current income tax of overseas subsidiaries is provided in the accounts at the amount expected to be paid to the taxation authorities, based on taxable profits determined in accordance with tax legislation of those countries. Deferred tax Deferred income tax is provided on temporary differences between the tax bases of assets and liabilities and their carrying amounts at the end of each reporting period, using the tax rates enacted at the end of the reporting period. The Group recognises deferred tax liabilities for all taxable temporary differences while they recognise deferred tax assets for all deductible temporary differences and tax losses carried forward to the extent that it is probable that future taxable profit will be available against which such deductible temporary differences and tax losses carried forward can be utilised.
At each reporting date, the Group reviews and reduces the carrying amount of deferred tax assets to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. The Group records deferred tax directly to shareholders’ equity if the tax relates to items that are recorded directly to shareholders’ equity. 4.18 Financial instruments The Group initially measures financial assets at its fair value plus, in the case of financial assets that are not measured at fair value through profit or loss, transaction costs. However, trade receivables, that do not contain a significant financing component, are measured at the transaction price as disclosed in the accounting policy relating to revenue recognition.
11
Classification and measurement of financial assets Financial assets are classified, at initial recognition, as to be subsequently measured at amortised cost, fair value through other comprehensive income (“FVOCI”), or fair value through profit or loss (“FVTPL”). The classification of financial assets at initial recognition is driven by the Group’s business model for managing the financial assets and the contractual cash flows characteristics of the financial assets. Financial assets at amortised cost The Group measures financial assets at amortised cost if the financial asset is held in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Financial assets at amortised cost are subsequently measured using the effective interest rate (“EIR”) method and are subject to impairment. Gains and losses are recognised in profit or loss when the asset is derecognised, modified or impaired. Financial assets designated at FVOCI (equity instruments) Upon initial recognition, the Group can elect to irrevocably classify its equity investments which are not held for trading as equity instruments designated at FVOCI. The classification is determined on an instrument-by-instrument basis.
Gains and losses recognised in other comprehensive income on these financial assets are never recycled to profit or loss. Dividends are recognised as other income in profit or loss, except when the dividends clearly represent a recovery of part of the cost of the financial asset, in which case, the gains are recognised in other comprehensive income. Equity instruments designated at FVOCI are not subject to impairment assessment. Financial assets at FVTPL Financial assets measured at FVTPL are carried in the statement of financial position at fair value with net changes in fair value recognised in profit or loss. These financial assets include derivatives, security investments held for trading, equity investments which the Group has not irrevocably elected to classify at FVOCI and financial assets with cash flows that are not solely payments of principal and interest. Dividends on such equity investments are recognised as other income in profit or loss.
12
Classification and measurement of financial liabilities Except for derivative liabilities, at initial recognition the Group’s financial liabilities are recognised at fair value net of transaction costs and classified as liabilities to be subsequently measured at amortised cost using the EIR method. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortisation process. In determining amortised cost, the Group takes into account any fees or costs that are an integral part of the EIR. The EIR amortisation is included in finance costs in profit or loss. Derecognition of financial instruments A financial asset is primarily derecognised when the rights to receive cash flows from the asset have expired or have been transferred and either the Group has transferred substantially all the risks and rewards of the asset, or the Group has transferred control of the asset. A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability.
The difference in the respective carrying amounts is recognised in profit or loss. Impairment of financial assets The Group recognises an allowance for expected credit losses (“ECLs”) for all debt instruments not held at FVTPL. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Group expects to receive, discounted at an approximation of the original effective interest rate. For credit exposures for which there has not been a significant increase in credit risk since initial recognition, ECLs are provided for credit losses that result from default events that are possible within the next 12-months (a 12-month ECL). For those credit exposures for which there has been a significant increase in credit risk since initial recognition, a loss allowance is required for credit losses expected over the remaining life of the exposure (a lifetime ECL).
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The Group considers a significant increase in credit risk to have occurred when contractual payments are more than 30 days past due and considers a financial asset as credit impaired or default when contractual payments are 90 days past due. However, in certain cases, the Group may also consider a financial asset to have a significant increase in credit risk and to be in default using other internal or external information, such as credit rating of issuers. For trade receivables, the Group applies a simplified approach in calculating ECLs. Therefore, the Group does not track changes in credit risk, but instead recognises a loss allowance based on lifetime ECLs at each reporting date. ECLs are calculated based on its historical credit loss experience and adjusted for forward-looking factors specific to the debtors and the economic environment. A financial asset is written off when there is no reasonable expectation of recovering the contractual cash flows. Offsetting of financial instruments Financial assets and financial liabilities are offset, and the net amount is reported in the statement of financial position if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously.