The American Club 2023/2024 Annual Report

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NOTES TO FINANCIAL STATEMENTS 30 JUNE 2024

2. MATERIAL ACCOUNTING POLICY INFORMATION (cont’d)

Financial liabilities

Other financial liabilities

Amounts due to members and other payables are initially measured at fair value and are subsequently measured at amortised cost, using the effective interest method with interest expense recognised on an effective yield basis, except for short-term payable when the recognition of interest would be immaterial.

Derecognition of financial liabilities

The Club derecognises financial liabilities when, and only when, the Club’s obligations are discharged, cancelled or they expire.

Derivative financial instruments

The Club enters into derivative financial instruments to manage its exposure to foreign exchange rate risk, including foreign exchange forward contracts. Further details of derivative financial instruments are disclosed in Note 13 to the financial statements. Derivatives are initially recognised at fair value at the date of a derivative contract is entered into and are subsequently remeasured to their fair value at the end of each reporting period. The resulting gain or loss is recognised in other comprehensive income immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in other comprehensive income depends on the nature of the hedge relationship. Hedge accounting is not applied by the Club. A derivative is presented as a non-current asset or a non-current liability if the remaining maturity of the instrument is more than 12 months and it is not expected to be realised or settled within 12 months. Other derivatives are presented as current assets or current liabilities. Consumable Stocks - Consumable stocks are stated at the lower of cost and net realisable value. Cost comprises cost of purchase and other costs incurred in bringing the consumable stocks to their present location and condition. Cost is calculated using the weighted average method. Net realisable value represents the estimated selling price less all estimated costs to be incurred in marketing, selling and distribution. Allowance is made for obsolete and slow- moving items.

Property, Plant and Equipment - Property, plant and equipment are stated at cost less accumulated depreciation and any accumulated impairment losses.

Construction-in-progress consists of upgrading work on buildings. Construction-in-progress is not depreciated.

Cost includes expenditure that is directly attributable to the acquisition of the asset. The cost of self-constructed assets includes the cost of materials and direct labour, any other costs directly attributable to bringing the asset to a working condition for its intended use, and the cost of dismantling and removing the items and restoring the site on which they are located. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment.

THE AMERICAN CLUB SINGAPORE ANNUAL REPORT 2023 / 2024