Notes to the Financial Statements For the financial year ended 31 December 2025 2. MATERIAL ACCOUNTING POLICY INFORMATION (CONT’D) 2.5 Standards issued but not yet effective (cont’d) FRS 118: Presentation and Disclosure in Financial Statements FRS 118 Presentation and Disclosure in Financial Statements will replace FRS 1 Presentation of Financial Statements and applies for annual reporting period beginning on or after 1 January 2027, but earlier application is permitted and must be disclosed. FRS 118 will apply retrospectively. FRS 118 introduces new requirements for presentation within the statement of profit or loss, including specified totals and subtotals. Furthermore, entities are required to classify all income and expenses within the statement of profit or loss into one of five categories: operating, investing, financing, income taxes and discontinued operations, whereof the first three are new. It also requires disclosure of newly defined management-defined performance measures, subtotals of income and expenses, and includes new requirements for aggregation and disaggregation of financial information based on the identified ‘roles’ of the primary financial statements and the notes. The Manager is currently working to identify all impacts that the standard and amendments will have on the primary financial statements and notes to the financial statements. Other than FRS 118 Presentation and Disclosure in Financial Statements, the Manager expects that the adoption of all the standards above will have no material impact on the financial statements in the year of initial application. 2.6 Basis of consolidation Subsidiaries Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. The financial statements of the subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases. The accounting policies of the subsidiaries have been aligned with the policies adopted by the Group. Losses within a subsidiary are attributed to the non-controlling interest even if that results in a deficit balance. In the Trust’s statement of financial position, investments in subsidiaries are accounted for at cost less impairment losses. Transactions with non-controlling interests Non-controlling interest represents the equity in subsidiaries not attributable, directly or indirectly, to the Group. Changes in the Group’s ownership interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions. Transactions eliminated on consolidation Intra-group balances and transactions, and any unrealised income and expenses arising from intra-group transactions, are eliminated in preparing the consolidated financial statements. Accounting for investments in subsidiaries and joint venture in the Trust’s financial statements Investments in subsidiaries and joint venture are stated in the Trust’s statement of financial position at cost less accumulated impairment losses. 161 ESR-REIT ANNUAL REPORT 2025
RkJQdWJsaXNoZXIy NTM2MDQ5