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129

notes to the

financial statements

FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2010 (cont’d)

4 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (s) Revenue recognition

(i) Income from hospital operations comprises inpatient and outpatient hospital charges, consultation fees, sales of

pharmaceutical products and medical supplies. These are recognised when services are rendered and goods are delivered, net of discounts, rebates and returns.

Other hospital income mainly consists of clinic rental for consultants. These are recognised on an accrual basis in

accordance with the substance of the relevant agreements.

(ii) Deferred revenue

Deferred revenue represents revenue students’ fees, accommodation fees and other external courses fees received.

Amounts are included in the fnancial statements as deferred revenue at the commencement of the course and recognised as revenue on monthly basis over the duration of the course.

(iii) Dividend income

Dividend income is recognised when the right to receive payment is established.

(iv) Management fees

Management fees represent fees charged to subsidiaries for assisting in the management of the subsidiaries and these

are recognised upon performance of services.

(v) Interest income

Interest income from short term deposits and fxed deposits are recognised on a time proportion basis, taking into account

the principal outstanding and the effective rate over the period of maturity, when it is determined that such income will accrued to the Group.

(t) Foreign currencies

(i) Functional and presentation currency

Items included in the fnancial statements of each of the Group’s entities are measured using the currency of the primary

economic environment in which the entity operates (the “functional currency”).

The fnancial statements are presented in Ringgit Malaysia, which is the Company’s functional and presentation currency.

(ii) Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing on the

transaction dates. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the proft or loss.

(iii) Group companies

The results and fnancial position of all the group entities (none of which has the currency of a hyperinfationary economy) that

have a functional currency different from the presentation currency are translated into the presentation currency as follows: (i) Assets and liabilities for each statement of fnancial position presented are translated at the closing rate at the date

of that statement of fnancial position;

(ii) Income and expenses for each statement of comprehensive income are translated at the average exchange rates

(unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the rate on the dates of the transactions); and

(iii) All resulting exchange differences are recognised as a separate component of other comprehensive income.

On consolidation, exchange differences arising from the translation of the net investment in foreign operations are

recognised in other comprehensive income. When a foreign operation is sold, a proportionate share of such exchange differences is reclassifed to proft or loss as part of the gain or loss on sale.

Goodwill and fair value adjustments arising on the acquisition of foreign entities are treated as assets and liabilities of the

foreign entity and are translated at the closing rate.