· note 2014/15 2013/14 $’000 $’000 accumulated surplus and reserve ... fs4 the accompanying...
TRANSCRIPT
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS1
The accompanying notes form an integral part of these financial statements.
Statement of financial position
As at 31 March 2015
Note 2014/15 2013/14
$’000 $’000
Accumulated surplus and reserve
General fund 9 174,723 234,610
Restricted funds 9 35,759 34,442
Fair value reserve 6,846 2,357
217,328 271,409
Temasek Polytechnic Endowment Fund 10 17,798 10,359
Other funds 11 9,285 9,504
Net assets of other funds 11 (9,285) (9,504)
– –
235,126 281,768
Non-current assets
Property, plant and equipment 4 621,769 560,109
Investments in subsidiaries 5 – –
Available-for-sale investments 6 29,149 64,014
650,918 624,123
Current assets
Available-for-sale investments 6 94,773 64,182
Trade and other receivables 7 8,577 5,666
Prepayments 326 491
Government grant receivables 14,595 18,332
Cash and cash equivalents 8 199,765 245,493
318,036 334,164
Total assets 968,954 958,287
Non-current liabilities
Fees received in advance 12 13,087 13,562
Deferred capital grants - Government 13 619,478 557,280
Deferred capital grants - Others 14 2,279 2,825
Government grants received in advance 15 58,805 49,373
693,649 623,040
Current liabilities
Government grants received in advance 15 326 187
Trade and other payables 16 39,853 53,292
40,179 53,479
Total liabilities 733,828 676,519
Net assets 235,126 281,768
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS2
The accompanying notes form an integral part of these financial statements.
Statement of comprehensive income
Year ended 31 March 2015
General fund Restricted funds Total
Note 2014/15 2013/14 2014/15 2013/14 2014/15 2013/14
$’000 $’000 $’000 $’000 $’000 $’000
Operating income
Student fees 44,811 44,614 – – 44,811 44,614
Other income 23 5,993 4,844 585 579 6,578 5,423
Donations 33 56 1,085 892 1,118 948
Courses, projects, seminars and talks 6,254 4,765 1,793 1,783 8,047 6,548
57,091 54,279 3,463 3,254 60,554 57,533
Operating expenses
Salaries, CPF and other related costs 200,078 197,967 1,307 1,243 201,385 199,210
Depreciation 4 40,519 33,622 4 11 40,523 33,633
Repairs, maintenance and utilities 23,248 23,162 263 212 23,511 23,374
Property, plant and equipment expensed off 3,766 4,015 40 4 3,806 4,019
Teaching materials and resources 4,063 4,385 2 – 4,065 4,385
Student welfare 3,419 3,197 – – 3,419 3,197
IT and information communication 701 744 49 39 750 783
Rental 861 908 651 747 1,512 1,655
Consultancy 906 1,073 – – 906 1,073
Other expenditure 5,496 7,719 1,694 2,013 7,190 9,732
Fees for fund managers 177 175 – – 177 175
Courses, projects, seminars and talks 5,998 4,856 1,819 1,652 7,817 6,508
289,232 281,823 5,829 5,921 295,061 287,744
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS3
The accompanying notes form an integral part of these financial statements.
Statement of comprehensive income (Cont’d)
Year ended 31 March 2015
General fund Restricted funds Total
Note 2014/15 2013/14 2014/15 2013/14 2014/15 2013/14
$’000 $’000 $’000 $’000 $’000 $’000
Operating deficit 17 (232,141) (227,544) (2,366) (2,667) (234,507) (230,211)
Non-operating income/(expense)
Interest income 18 4,244 4,521 835 488 5,079 5,009
Investment income 19 125 2,386 – – 125 2,386
(Loss)/Gain on disposal of property, plant and equipment (272) 124 – – (272) 124
Deficit before grants (228,044) (220,513) (1,531) (2,179) (229,575) (222,692)
Grants
Deferred capital grants amortised:
Government 13 40,878 35,575 41 7 40,919 35,582
Others 14 1,165 1,103 – – 1,165 1,103
Operating grants:
Government 20 126,076 167,752 2,807 2,892 128,883 170,644
Others 38 13 – – 38 13
168,157 204,443 2,848 2,899 171,005 207,342
(Deficit)/Surplus for the year (59,887) (16,070) 1,317 720 (58,570) (15,350)
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS4
The accompanying notes form an integral part of these financial statements.
Statement of comprehensive income (Cont’d)
Year ended 31 March 2015
General fund Restricted funds Total
2014/15 2013/14 2014/15 2013/14 2014/15 2013/14
$’000 $’000 $’000 $’000 $’000 $’000
(Deficit)/Surplus for the year (59,887) (16,070) 1,317 720 (58,570) (15,350)
Other comprehensive income
Items that are or may be reclassified
subsequently to profit or loss:
Net change in fair value of available-for-sale financial assets 5,078 (2,858) (589) (74) 4,489 (2,932)
5,078 (2,858) (589) (74) 4,489 (2,932)
Total comprehensive income for the year (54,809) (18,928) 728 646 (54,081) (18,282)
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS5
The accompanying notes form an integral part of these financial statements.
Statement of changes in accumulated surplus and reserve
Year ended 31 March 2015
General
fund
Restricted
fund
Fair value
reserve Total
$’000 $’000 $’000 $’000
At 1 April 2013 250,680 33,722 5,289 289,691
Total comprehensive income for the year (16,070) 720 (2,932) (18,282)
At 31 March 2014 234,610 34,442 2,357 271,409
At 1 April 2014 234,610 34,442 2,357 271,409
Total comprehensive income for the year (59,887) 1,317 4,489 (54,081)
At 31 March 2015 174,723 35,759 6,846 217,328
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS6
The accompanying notes form an integral part of these financial statements.
Statement of cash flows
Year ended 31 March 2015
Note 2014/15 2013/14
$’000 $’000
Cash flows from operating activities
Deficit before grants (229,575) (222,692)
Adjustments for:
Special projects and other grants income (2,517) –
Depreciation of property, plant and equipment 4 40,523 33,633
Goods and services tax (19,611) (18,941)
Fees for fund managers 177 175
Interest income 18 (5,079) (5,009)
Investment loss/(income) 19 (125) (2,386)
Amortisation of fees received in advance (475) –
Loss/(Gain) on disposal of property, plant and equipment 272 (124)
(216,410) (215,344)
Changes in:
Trade and other receivables (1,306) 287
Prepayment 165 30
Fees received in advance – 8,529
Trade and other payables (21,070) (13,608)
Net cash used in operating activities (238,621) (220,106)
Cash flows from investing activities
Interest received 3,913 5,009
Dividend income from available-for-sale investments – 655
Cash balances with fund managers 1,322 (549)
Acquisition of available-for-sale investments (11,323) (13,193)
Proceeds from disposal of available-for-sale investments 20,000 –
Proceeds from sale of property, plant and equipment 88 235
Purchase of property, plant and equipment (98,528) (86,134)
Net cash used in investing activities (84,528) (93,977)
Cash flows from financing activities
Capital grants received from Government 8,002 44,128
Goods and services tax grants received from Government 19,611 18,941
F&E and IT grants received from Government 25,476 25,774
MOE Bursary received 3,532 2,593
Matching grant received from Government as Endowment
Fund 10 3,939 2,151
Operating grants received from Government 211,021 208,335
Special projects and other grants received 3,662 2,855
Donations received for Bursary & Scholarships 10 3,500 1,850
Net cash from financing activities 278,743 306,627
Net increase/(decrease) in cash and cash equivalents (44,406) (7,456)
Cash and cash equivalents at beginning of year 243,115 250,571
Cash and cash equivalents at end of year 8 198,709 243,115
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS7
Notes to the financial statements
These notes form an integral part of the financial statements.
The financial statements were authorised for issue by the Board of Governors on 18 June 2015.
1 Domicile and activities
Temasek Polytechnic (the “Polytechnic”) was established in 1990 under the Temasek
Polytechnic Act (Chapter 323A). It is domiciled in the Republic of Singapore and its campus is
situated at 21 Tampines Avenue 1, Singapore 529757.
The principal activities of the Polytechnic are to provide instruction, training and research in
technology, science, commerce, arts and other subjects of learning.
2 Basis of preparation
2.1 Statement of compliance
The financial statements have been prepared in accordance with the applicable requirements of
Temasek Polytechnic Act, Chapter 323A, the Singapore Charities Act, Chapter 37 (the
“Charities Act”) and Singapore Statutory Board Financial Reporting Standards (“SB-FRS”).
SB-FRS includes Statutory Board Financial Reporting Standards, Interpretations of SB-FRS
(“INT SB-FRS”) and SB-FRS Guidance Notes as promulgated by the Accountant-General.
2.2 Basis of measurement
The financial statements have been prepared on the historical cost basis except for certain
financial assets and financial liabilities which are stated at fair value.
2.3 Functional and presentation currency
The financial statements are presented in Singapore dollars which is the Polytechnic’s
functional currency. All financial information is presented in Singapore dollars, unless
otherwise stated.
2.4 Use of estimates and judgements
The preparation of financial statements in conformity with SB-FRSs requires management to
make judgements, estimates and assumptions that affect the application of accounting policies
and the reported amounts of assets, liabilities, income and expenses. Actual results may differ
from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to
accounting estimates are recognised in the period in which the estimates are revised and in any
future periods affected.
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS8
Measurement of fair values
A number of the Polytechnic’s accounting policies and disclosures require the measurement of
fair values, for both financial and non-financial assets and liabilities.
When measuring the fair value of an asset or a liability, the Polytechnic uses market observable
data as far as possible. Fair values are categorised into different levels in a fair value hierarchy
based on the inputs used in the valuation techniques as follows:
● Level 1 : quoted prices (unadjusted) in active markets for identical assets or liabilities
that the Polytechnic can access at the measurement date. ● Level 2 : inputs other than quoted prices included within Level 1 that are observable
for the asset or liability, either directly (i.e. as prices) or indirectly (i.e.
derived from prices). ● Level 3 : inputs for the asset or liability that are not based on observable market data
(unobservable inputs).
If the inputs used to measure the fair value of an asset or a liability might be categorised in
different levels of the fair value hierarchy, then the fair value measurement is categorised in its
entirety in the same level of the fair value hierarchy as the lowest level input that is significant
to the entire measurement (with Level 3 being the lowest).
The Polytechnic recognises transfers between levels of the fair value hierarchy as of the end of
the reporting period during which the changes has occurred.
2.5 Changes in accounting polices
Offsetting of financial assets and liabilities
Under the Amendments to SB-FRS 32 Financial Instruments: Presentation – Offsetting
Financial Assets and Financial Liabilities, to qualify for offsetting, the right to set off a
financial asset and a financial liability must not be contingent on a future event and must be
legally enforceable both in the normal course of business and in the event of default, insolvency
or bankruptcy of the entity and its counterparties.
Notwithstanding the above, the change had no significant impact on the measurements of the
Company’s assets and liabilities.
3 Significant accounting policies
The accounting policies used by the Polytechnic have been applied consistently to all periods
presented in these financial statements, except as explained in note 2.5 which addresses changes
in accounting policy.
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS9
3.1 Investments in subsidiaries
Subsidiaries
Subsidiaries are entities controlled by the Polytechnic. The Polytechnic 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.
Investments in subsidiaries are stated in the Polytechnic’s statement of financial position at cost
less accumulated impairment loss.
3.2 Foreign currency transactions
Transactions in foreign currencies are translated to the functional currency of the Polytechnic at
the exchange rates at the dates of the transactions. Monetary assets and liabilities denominated
in foreign currencies at the end of the reporting period are retranslated to the functional currency
at the exchange rate at that date. The foreign currency gain or loss on monetary items is the
difference between amortised cost in the functional currency at the beginning of the year,
adjusted for effective interest and payments during the year, and the amortised cost in foreign
currency translated at the exchange rate at the end of the year.
Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair
value are retranslated to the functional currency at the exchange rate at the date that the fair
value was determined. Non-monetary items in a foreign currency that are measured in terms of
historical cost are translated using the exchange rate at the date of the transaction. Foreign
currency differences arising on retranslation are recognised in profit or loss.
3.3 Financial instruments
Non-derivative financial assets
The Polytechnic initially recognises loans and receivables and deposits on the date that they are
originated. All other financial assets are recognised initially on the trade date, which is the date
that the Polytechnic becomes a party to the contractual provisions of the instrument.
The Polytechnic derecognises a financial asset when the contractual rights to the cash flows
from the asset expire, or it transfers the rights to receive the contractual cash flows on the
financial asset in a transaction in which substantially all the risks and rewards of ownership of
the financial asset are transferred. Any interest in transferred financial assets that is created or
retained by the Polytechnic is recognised as a separate asset or liability.
Financial assets and liabilities are offset and the net amount presented in the statement of
financial position when, and only when, the Polytechnic has a legal right to offset the amounts
and intends either to settle on a net basis or to realise the asset and settle the liability
simultaneously.
The Polytechnic classifies non-derivative financial assets into the following categories: loans
and receivables and available-for-sale financial assets.
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS10
Loans and receivables
Loans and receivables are financial assets with fixed or determinable payments that are not
quoted in an active market. Such assets are recognised initially at fair value plus any directly
attributable transaction costs. Subsequent to initial recognition, loans and receivables are
measured at amortised cost using the effective interest method, less any impairment losses.
Loans and receivables comprise cash and cash equivalents, and trade and other receivables.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances, bank deposits and demand deposits that are
readily convertible to a known amount of cash and are subject to an insignificant risk of changes
in value.
Available-for-sale financial assets
Available-for-sale financial assets are non-derivative financial assets that are designated as
available for sale or are not classified in any of the above categories of financial assets.
Available-for-sale financial assets are recognised initially at fair value plus any directly
attributable transaction costs. Subsequent to initial recognition, they are measured at fair value
and changes therein, other than impairment losses and foreign currency differences on
available-for-sale debt instruments, are recognised in other comprehensive income and
presented in the fair value reserve in accumulated surplus and reserve. When an investment is
derecognised, the gain or loss accumulated in accumulated surplus and reserves is reclassified to
profit or loss.
Available-for-sale financial assets comprise equity securities, debt securities and funds managed
by fund managers.
Non-derivative financial liabilities
Financial liabilities (including financial liabilities designated at fair value through profit or loss)
are recognised initially on trade date, which is the date that the Polytechnic becomes a party to
the contractual provisions of the instrument.
The Polytechnic derecognises a financial liability when its contractual obligations are
discharged, cancelled or expired.
Financial assets and liabilities are offset and the net amount presented in the statement of
financial position when, and only when, the Polytechnic has a legal right to offset the amounts
and intends either to settle on a net basis or to realise the asset and settle the liability
simultaneously.
The Polytechnic classifies non-derivative financial liabilities into the other financial liabilities
category. Such financial liabilities are recognised initially at fair value plus any directly
attributable transaction costs. Subsequent to initial recognition, these financial liabilities are
measured at amortised cost using the effective interest method.
Other financial liabilities comprise trade and other payables.
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS11
3.4 Funds
General funds
Income and expenditure relating to the main accounts of the Polytechnic are accounted for
through the General Fund in the Statement of Comprehensive Income.
Restricted funds
Income and expenditure relating to funds set up for contributions received and expenditure
incurred for specific purposes are accounted for through the Restricted Fund in the Statement of
Comprehensive Income.
The assets and liabilities of these funds are accounted for separately. However, for presentation
purposes, they are pooled together with those of the General Fund.
Other funds
Funds are set up to account for contributions received from external sources for specific
purposes.
The assets and liabilities of funds – Funds for student loans, Ministry of Education Opportunity
Fund and Khoo Teck Puat International Opportunity Programme Fund held in trust for Ministry
of Education and Campus Care Network Fund held in trust for the staff and students of the
Polytechnic are presented as a line item under the capital and other funds section on the face of
the balance sheet of the financial statements as prescribed by SB-FRS Guidance Note 1.
Income and expenditure relating to these funds are accounted for directly in these funds.
Details of income, expenditure, assets and liabilities relating to these funds are disclosed in Note
11 to the financial statements.
3.5 Property, plant and equipment
Recognition and measurement
Items of property, plant and equipment are measured at cost less accumulated depreciation and
accumulated impairment losses.
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 assets to a working condition for their
intended use;
when the Polytechnic has an obligation to remove the asset or restore the site, an estimate of
the costs of dismantling and removing the items and restoring the site on which they are
located; and
capitalised borrowing costs.
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS12
Purchased software that is integral to the functionality of the related equipment is capitalised as
part of that equipment.
When parts of an item of property, plant and equipment have different useful lives, they are
accounted for as separate items (major components) of property, plant and equipment.
The gain or loss on disposal of an item of property, plant and equipment (calculated as the
difference between the net proceeds from disposal and the carrying amount of the item) is
recognised in profit or loss.
Subsequent costs
The cost of replacing a component of an item of property, plant and equipment is recognised in
the carrying amount of the item if it is probable that the future economic benefits embodied
within the component will flow to the Polytechnic and its cost can be measured reliably. The
carrying amount of the replaced component is derecognised. The costs of the day-to-day
servicing of property, plant and equipment are recognised in profit or loss as incurred.
Property, plant and equipment costing less than $2,000 are charged to statement of
comprehensive income in the year of purchase.
Depreciation
Depreciation is based on the cost of an asset less its residual value. Significant components of
individual assets are assessed and if a component has a useful life that is different from the
remainder of that asset, that component is depreciated separately.
Depreciation is recognised as an expense in profit or loss on a straight-line basis over the
estimated useful lives of each component of an item of property, plant and equipment.
Depreciation is recognised from the date that the property, plant and equipment are installed and
are ready for use, or in respect of internally constructed assets, from the date that the asset is
completed and ready for use.
The estimated useful lives for the current and comparative years are as follows:
Leasehold land - Over lease term of 99 years
Leasehold buildings - 30 to 50 years
Building improvements - 5 years
Furniture, fittings and equipment - 5 years
Computer hardware and software - 3 to 5 years
Workshop equipment and machinery - 5 to 10 years
Vehicles - 5 years
Plant and machinery - 10 years
Depreciation methods, useful lives and residual values are reviewed at the end of each reporting
period and adjusted if appropriate.
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS13
3.6 Impairment
Non-derivative financial assets
A financial asset not carried at fair value through profit or loss is assessed at the end of each
reporting period to determine whether there is objective evidence that it is impaired. A financial
asset is impaired if objective evidence indicates that a loss event has occurred after the initial
recognition of the asset, and that the loss event has an impact on the estimated future cash flows
of that asset that can be estimated reliably.
Objective evidence that financial assets (including equity securities) are impaired can include
default or delinquency by a debtor, restructuring of an amount due to the Polytechnic on terms
that the Polytechnic would not consider otherwise, indications that a debtor will enter
bankruptcy, adverse changes in the payment status of borrowers and economic conditions that
correlate with defaults or the disappearance of an active market for a security. In addition, for
an investment in an equity security, a significant or prolonged decline in its fair value below its
cost is objective evidence of impairment. The Polytechnic considers a decline of 20% to be
significant and a period of 9 months to be prolonged.
Loans and receivables
The Polytechnic considers evidence of impairment for loans and receivables at a specific asset
and collective level. All individually significant loans and receivables are assessed for specific
impairment. All individually significant loans and receivables found not to be specifically
impaired are then collectively assessed for any impairment that has been incurred but not yet
identified. Loans and receivables that are not individually significant are collectively assessed
for impairment by grouping together loans and receivables with similar risk characteristics.
In assessing collective impairment, the Polytechnic uses historical trends of the probability of
default, timing of recoveries and the amount of loss incurred, adjusted for management’s
judgement as to whether current economic and credit conditions are such that the actual losses
are likely to be greater or less than suggested by historical trends.
An impairment loss in respect of a financial asset measured at amortised cost is calculated as the
difference between its carrying amount and the present value of the estimated future cash flows
discounted at the asset’s original effective interest rate. Losses are recognised in profit or loss
and reflected in an allowance account against loans and receivables. Interest on the impaired
asset continues to be recognised. When the Polytechnic considers that there are no realistic
prospects of recovery of the asset, the relevant amounts are written off. If the amount of
impairment loss subsequently decreases and the decrease can be related objectively to an event
occurring after the impairment was recognised, then the previously recognised impairment loss
is reversed through profit and loss.
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS14
Available-for-sale financial assets
Impairment losses on available-for-sale financial assets are recognised by reclassifying the
losses accumulated in the fair value reserve in accumulated surplus and reserve to profit or loss.
The cumulative loss that is reclassified from accumulated surplus and reserve to profit or loss is
the difference between the acquisition cost, net of any principal repayment and amortisation,
and the current fair value, less any impairment loss recognised previously in profit or loss.
Changes in cumulative impairment provisions attributable to application of the effective interest
method are reflected as a component of interest income. If, in a subsequent period, the fair value
of an impaired available-for-sale debt security increases and the increase can be related
objectively to an event occurring after the impairment loss was recognised, then the impairment
loss is reversed. The amount of the reversal is recognised in profit or loss. However, any
subsequent recovery in the fair value of an impaired available-for-sale equity security is
recognised in other comprehensive income.
Non-financial assets
The carrying amounts of the Polytechnic’s non-financial assets are reviewed at each reporting
date to determine whether there is any indication of impairment. If any such indication exists,
then the assets’ recoverable amount is estimated. An impairment loss is recognised if the
carrying amount of an asset or its related cash-generating unit (CGU) exceeds its estimated
recoverable amount.
The recoverable amount of an asset or CGU is the greater of its value in use and its fair value
less costs to sell. In assessing 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 or CGU. For the purpose of impairment
testing, assets that cannot be tested individually are grouped together into the smallest group of
assets that generates cash inflows from continuing use that are largely independent of the cash
inflows of other assets or CGUs.
Impairment losses are recognised in profit or loss. Impairment losses recognised in respect of
CGUs are allocated to reduce the carrying amounts of the other assets in the CGU (group of
CGUs) on a pro rata basis.
Impairment losses recognised in prior periods are assessed at each reporting date for any
indications that the losses have decreased or no longer exist. An impairment loss is reversed if
there has been a change in the estimates used to determine the recoverable amount. An
impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed
the carrying amount that would have been determined, net of depreciation or amortisation, if no
impairment loss had been recognised.
3.7 Lease payments
Payments made under operating leases are recognised in profit or loss on a straight-line basis
over the term of the lease.
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS15
3.8 Employee benefits
Defined contribution plans
A defined contribution plan is a post-employment benefit plan under which an entity pays fixed
contributions into a separate entity and will have no legal or constructive obligation to pay
further amounts. Obligations for contributions to defined contribution pension plans are
recognised as an employee benefit expense in profit or loss in the periods during which services
are rendered by employees.
Short-term benefits
Short-term employee benefit obligations are measured on an undiscounted basis and are
expensed as the related service is provided. A liability is recognised for the amount expected to
be paid under short-term cash bonus or profit-sharing plans if the Polytechnic has a present legal
or constructive obligation to pay this amount as a result of past service provided by the
employee and the obligation can be estimated reliably.
3.9 Provisions
A provision is recognised if, as a result of a past event, the Polytechnic has a present legal or
constructive obligation that can be estimated reliably, and it is probable that an outflow of
economic benefits will be required to settle the obligation. Provisions are determined by
discounting the expected future cash flows at a pre-tax rate that reflects current market
assessments of the time value of money and the risks specific to the liability. The unwinding of
the discount is recognised as finance cost.
3.10 Revenue
Student fees
Tuition and other fees for an academic year are recognised over the period of service in a
financial year.
Income from courses/projects
Revenue from courses/projects is recognised based on percentage of completion, determined on
straight-line basis over the period of the courses/projects.
Donations
Donations are recognised upon receipt.
3.11 Finance income
Finance income comprises interest income on funds invested. Interest income is recognised as
it accrues in profit or loss, using the effective interest method.
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS16
3.12 Government grants
Government grants related to assets in which the Polytechnic has discretionary management
power are taken directly to the Deferred Capital Grant account, or to the Statement of
Comprehensive Income for assets which are expensed off in the year of purchase.
Other government grants related to assets are initially taken to Government grant received in
advance account and upon their utilisation for the purchase of assets, they are transferred to the
Deferred Capital Grant account, or to the Statement of Comprehensive Income for assets which
are written off in the year of purchase.
The deferred capital grants are recognised in the Statement of Comprehensive Income over the
periods necessary to match the depreciation and write off of the property, plant and equipment
purchased with the related grants. Upon the disposal of the property, plant and equipment, the
balance of the related deferred capital grants is recognised in the Statement of Comprehensive
Income to reflect the net book value of the assets disposed.
Government grants to meet the current year’s operating expenses are taken to the Statement of
Comprehensive Income for the year. Government grants are accounted for on an accrual basis.
3.13 Tax
The Polytechnic is registered as a charitable institution with effect from the Year of Assessment
2008 or the financial year ended 31 March 2007, all registered charities will enjoy automatic
income tax exemption without having the need to meet the 80% spending rule and there is no
need to file income tax returns by virtue of Section 13(1)(zm) of the Income Tax Act, Chapter
134.
3.14 New standards and interpretations not adopted
A number of new standards, amendments to standards and interpretations are effective for the
annual periods beginning on or after 1 April 2014, and have not been applied in preparing these
financial statements. None of these is expected to have a significant effect on the financial
statements of the Polytechnic.
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS17
4 Property, plant and equipment
Leasehold
land
Leasehold
buildings
Buildings
improve-
ments
Furniture
fittings and
equipment
Computer
hardware
Workshop
equipment
and
machinery Vehicles
Computer
software
Plant and
machinery
Capital
work-in-
progress Total
$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000
Cost
At 1 April 2013 66,889 480,123 26,987 69,644 71,694 47,487 98 48,430 111,095 30,221 952,668
Additions – 8,898 950 11,316 6,327 2,439 8 2,041 9,755 60,224 101,958
Transfers – 21,948 1,246 – – – – 441 423 (24,058) –
Disposals – (64) (1,976) (3,283) (6,571) (2,099) (15) (729) – – (14,737)
At 31 March 2014 66,889 510,905 27,207 77,677 71,450 47,827 91 50,183 121,273 66,387 1,039,889
Additions – 6,264 5,970 2,229 6,722 2,678 – 2,928 17 75,818 102,626
Transfers – 25,085 812 6,650 2,548 273 – 561 10,329 (46,258) –
Disposals – (538) (2,036) (7,275) (4,236) (1,533) – (1,032) (482) – (17,132)
At 31 March 2015 66,889 541,716 31,953 79,281 76,484 49,245 91 52,640 131,137 95,947 1,125,383
Accumulated
depreciation
At 1 April 2013 12,030 141,437 22,247 54,839 63,567 41,683 90 40,807 84,073 – 460,773
Depreciation 703 10,308 1,605 4,711 5,664 2,475 4 4,165 3,998 – 33,633
Disposals – (17) (1,930) (3,274) (6,565) (2,097) (15) (728) – – (14,626)
At 31 March 2014 12,733 151,728 21,922 56,276 62,666 42,061 79 44,244 88,071 – 479,780
Depreciation 703 11,379 2,202 7,475 6,735 2,610 4 3,967 5,448 – 40,523
Disposals – (177) (2,037) (7,271) (4,215) (1,510) – (1,000) (479) – (16,689)
At 31 March 2015 13,436 162,930 22,087 56,480 65,186 43,161 83 47,211 93,040 – 503,614
Carrying amounts
At 1 April 2013 54,859 338,686 4,740 14,805 8,127 5,804 8 7,623 27,022 30,221 491,895
At 31 March 2014 54,156 359,177 5,285 21,401 8,784 5,766 12 5,939 33,202 66,387 560,109
At 31 March 2015 53,453 378,786 9,866 22,801 11,298 6,084 8 5,429 38,097 95,947 621,769
During the year, the amount of property, plant and equipment acquired by the Polytechnic which remains unpaid as at year-end amounts to
$4,098,000 (2014: $15,824,000) (Note 16). The cash outflow on acquisition of property, plant and equipment amounted to $98,528,000 (2014:
$86,134,000).
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS18
5 Investments in subsidiaries 2014/15 2013/14
$ $
Unquoted equity shares, at cost 2 2
Details of subsidiaries are as follows:
Name of subsidiary Principal activities
Country of
registration
and operation
Equity
interest held
2014/15 2013/14
% %
Held by the Polytechnic:
TP Innovation Holdings Pte Ltd Investment company to
promote and
commercialise Temasek
Polytechnic’s research
and development results,
technology, design or
business innovations
Singapore 100 100
Held by the subsidiary:
TP Education Services Pte Ltd Company dealing with
matters relating to and
connected to education,
course know-how,
training of personnel, on
the job training and/or
internship placements for
students and granting licences and franchises
Singapore 100 100
At the reporting date, the Polytechnic had given an undertaking to provide continuing financial
support to the subsidiaries.
The assets, liabilities and results of the subsidiaries have not been consolidated as they are not
considered to be material to the Polytechnic’s financial statements.
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS19
6 Available-for-sale investments 2014/15 2013/14
$’000 $’000
Non-current
At cost:
Unquoted equity shares 458 458
At fair value:
Financial assets available-for-sale
Quoted debt securities 28,691 63,556
29,149 64,014
Current
At fair value:
Financial assets available-for-sale
Quoted debt securities 23,615 −
Quoted securities managed by fund managers
- equity 24,088 19,561
- unit trust/real estate investment trusts 47,070 44,621
94,773 64,182
As at the reporting date, the quoted debt securities bear interest rate of from 3.25% to 5.75%
(2014: 3.25% to 5.75%) per annum. Interest is receivable on a semi-annual basis. The maturity
dates of debt securities range from 15 December 2015 to perpetual (2014: 10 September 2014 to
24 August 2020).
Investments managed by fund managers form part of the Polytechnic’s funds which are
administered by asset management companies (fund managers). The fund managers are given
discretionary powers within certain guidelines to invest the funds.
The Polytechnic’s available-for-sale investments that are not denominated in its functional
currency are as follows:
2014/15 2013/14
$’000 $’000
Australian dollar 1,622 −
Hong Kong dollar 1,160 2,071
United States dollar 49,161 25,573
Indonesian rupiah 97 1,374
Thailand baht 206 1,406
Great Britain pound (80) 1,365
Others 3,637 5,517
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS20
7 Trade and other receivables 2014/15 2013/14
$’000 $’000
Trade receivables 1,048 716
Deposits 382 249
Singapore Totalisator Board grant (“Tote grant”) 350 174
Loans due from subsidiaries 218 201
Fund manager 109 −
Sundry debtors 6470 4,326
8,577 5,666
The Company’s exposure to credit risk and impairment losses related to trade and other
receivables is disclosed in note 22.
8 Cash and cash equivalents 2014/15 2013/14
$’000 $’000
Cash at bank and on hand (1,188) (2,232)
Cash with the AGD 200,953 247,725
Total cash and bank balances 199,765 245,493
Less:
Cash and cash equivalents managed by fund managers:
- Cash at bank and on hand (1,056) (2,378)
Net cash and cash equivalents in cash flow statement 198,709 243,115
Cash with the Accountant-General’s Department (“AGD”) refers to cash that are managed by
the AGD under Centralised Liquidity Management (“CLM”) as set out in the Accountant-
General's Circular No.4/2009 Centralised Liquidity Management for Statutory Boards and
Ministries.
The interest rate of cash with AGD, defined as the ratio of the interest earned to the average
cash balance, is 0.79% (2014: 0.52%) or ranges from 0.64% to 0.99% (2014: 0.43 to 0.61%) per
annum.
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS21
9 Accumulated surplus and reserve
General Fund
As at the reporting date, the Polytechnic has capital commitments of approximately $29 million
(2014: $88 million).
Restricted Funds
Restricted Funds comprise the following funds:
Name of Fund Purpose
Bursary, Scholarship and Awards Fund Providing financial assistance to needy
students, scholarships to students and book
prizes and medals to students and graduates
who excel academically and in extra-curricular activities.
Staff Apartment Fund Maintaining and upgrading of the Polytechnic’s staff apartments.
Temasek Polytechnic Endowment Fund Providing financial support for:
(a) staff development;
(b) student development, focusing on international exchange;
(c) promotion of innovation;
(d) bringing relevant world-class expertise to
the Polytechnic;
(e) scholarships to outstanding students; and
(f) bursaries to deserving needy students
Miscellaneous Fund
– Self Financing Project Fund
Conducting pre-employment education for the
hospitality and tourism workforce in Singapore,
short and continuing education courses;
upgrading Polytechnic’s teaching facilities; and
providing welfare and wellness activities for the Polytechnic’s students and staff.
– Special Projects Fund Providing training and placement for working
adults with funding from Government agencies
and external parties.
The Bursary, Scholarship and Awards Fund and Temasek Polytechnic Endowment Fund are
included in the Temasek Polytechnic General Education Fund (See Note 21).
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS22
Restricted Funds
Bursary, Scholarship
and Awards Fund Staff Apartment Fund
Temasek Polytechnic
Endowment Fund Miscellaneous Fund Total
2014/15 2013/14 2014/15 2013/14 2014/15 2013/14 2014/15 2013/14 2014/15 2013/14
$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000
Operating income
Courses, projects, seminars and talks – – – – – – 1,793 1,783 1,793 1,783
Donations:
- Tax deductible 921 575 – – – – – – 921 575
- Non-tax deductible 164 317 – – – – – – 164 317
Other income – – 578 564 – – 7 15 585 579
1,085 892 578 564 – – 1,800 1,798 3,463 3,254
Operating expenditure
Courses, projects, seminars and talks – – – – – – 1,819 1,652 1,819 1,652
Depreciation – – 1 1 – – 3 10 4 11
IT and information communication – – – – – – 49 39 49 39
Other expenditure 882 963 588 619 170 314 54 117 1,694 2,013
Property, plant and equipment
expensed off – – – 4 – – 40 – 40 4
Rental – – – – – – 651 747 651 747
Repairs and maintenance – – – – – – 263 212 263 212
Salaries, CPF and other related costs – – – – – – 1,307 1,243 1,307 1,243
Teaching materials and resources – – – – – – 2 – 2 –
882 963 589 624 170 314 4,188 4,020 5,829 5,921
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS23
Restricted Funds
Bursary, Scholarship
and Awards Fund Staff Apartment Fund
Temasek Polytechnic
Endowment Fund Miscellaneous Fund Total
2014/15 2013/14 2014/15 2013/14 2014/15 2013/14 2014/15 2013/14 2014/15 2013/14
$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000
Operating surplus/(deficit) 203 (71) (11) (60) (170) (314) (2,388) (2,222) (2,366) (2,667)
Non-operating income
Interest income 21 7 – – 634 373 180 108 835 488
Surplus/(deficit) before grants 224 (64) (11) (60) 464 59 (2,208) (2,114) (1,531) (2,179)
Grants
Deferred capital grant amortised -
Government – – – – – – 41 7 41 7
Operating grant - Government – – – – – – 2,807 2,892 2,807 2,892
Surplus/(deficit) for the year 224 (64) (11) (60) 464 59 640 785 1,317 720
Accumulated surplus at 1 April 823 887 3,256 3,316 590 531 29,773 28,988 34,442 33,722
Accumulated surplus at 31 March 1,047 823 3,245 3,256 1,054 590 30,413 29,773 35,759 34,442
Represented by:
Property, plant and equipment – – 15 6 – – 1 3 16 9
Government grant receivables – – – – – – 2,555 213 2,555 213
Trade and other receivables 13 6 7 19 165 55 720 455 905 535
Cash and bank balances 1,415 1,225 3,267 3,270 889 535 27,739 29,755 33,310 34,785
Government grants received in
advance – – – – – – (142) (182) (142) (182)
Trade and other payables (381) (408) (44) (39) – – (459) (469) (884) (916)
Deferred capital grant - Government – – – – – – (1) (2) (1) (2)
1,047 823 3,245 3,256 1,054 590 30,413 29,773 35,759 34,442
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS24
10 Temasek Polytechnic Endowment Fund
Donations and contributions made to the Temasek Polytechnic Endowment Fund are retained as
principal capital to be kept intact to earn income. Income and expenditure of the fund are taken
to "Restricted Funds" in the Statement of Comprehensive Income.
2014/15 2013/14
$’000 $’000
At 1 April 10,359 6,358
Donations received 3,500 1,850
Matching grant received from Government 3,939 2,151
At 31 March 17,798 10,359
Represented by:
Investment in debt securities 13,709 8,208
Cash and bank balances 4,089 2,151
17,798 10,359
During the year, a matching grant was received from MOE amounting to $939,000 (2014:
$1,626,000) for non-endowed donations received which were recognised in the Statement of
Comprehensive Income.
11 Other funds
(a) Tuition Fee Loan
Tuition fee loan comprises advances from the Government, which provides tuition fee loans to
students. The tuition fee loans are administered by a financial institution. Loans given to
students are interest-free until the year of their graduation, or for those with National Service
obligation, in the year in which they finish their National Service. Thereafter, loans are
repayable by monthly instalments with interest based on the average prime rates of banks or
such other rate as may be determined by the Polytechnic.
Repayment of the loans will eventually be returned to the Government. Accordingly, the
carrying amounts of staff and student loans approximate their fair values.
2014/15 2013/14
$’000 $’000
At 1 April 5,871 5,829
Amount contributed by Government 1,357 1,588
Amount refunded to Government (1,488) (1,546)
At 31 March 5,740 5,871
Represented by:
Outstanding loans:
Tuition fee loans 5,740 5,871
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS25
(b) Campus Care Network Fund
The campus care network ("CCN") fund was set up to provide crisis assistance, emergency
assistance as well as education assistance to needy students. The source of fund comes mainly
from proceeds collected through fund raising activities among students and staff within the
campus on CCN days. The fund is managed by a CCN committee.
2014/15 2013/14
$’000 $’000
At 1 April 281 269
Contribution received 71 62
Other income 4 3
Relief to students (66) (53)
At 31 March 290 281
Represented by:
Cash and bank balances 290 281
(c) Khoo Teck Puat International Opportunity Programme Fund
The Estate of Tan Sri Khoo Teck Puat launched the Khoo Teck Puat International Opportunity
Programme (“KTPIOP”) on 18 December 2007. The KTPIOP is supported by this fund. This
programme aims to provide needy students from the Polytechnic an opportunity to obtain an
overseas education experience. The fund is managed and disbursed by MOE to the Polytechnic
which will administer the application and award processing on behalf of the donor.
2014/15 2013/14
$’000 $’000
At 1 April 3 93
Contribution received 110 33
Financial assistance to students (60) (123)
At 31 March 53 3
Represented by:
Cash and bank balances 53 3
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS26
(d) Ministry of Education Opportunity Fund
During FY13/14, the Ministry of Education extended the Ministry of Education Opportunity
Funds (“MOEOF”) to Polytechnics. These grants are to be used to level up co-curriculum
development opportunities for Singaporean students from lower income households.
2014/15 2013/14
$’000 $’000
At 1 April 3,349 –
Contribution received – 3,419
Financial assistance to students (168) (74)
Interest earned from unutilised funds 21 4
At 31 March 3,202 3,349
Represented by:
Cash and bank balances 3,202 3,349
12 Fees received in advance
Fees received in advance from Singapore Institute of Technology (“SIT”) for the usage of the
Polytechnic's facilities by SIT students will be amortised over a 30-year period commencing
from 14 March 2014 in accordance with the service agreement between the Polytechnic and
SIT.
13 Deferred capital grants - Government Note 2014/15 2013/14
$’000 $’000
Grants utilised as at 1 April 557,280 488,508
Grants utilised on property, plant and equipment:
Development grants 70 47,557
Operating grants 20 90,169 43,404
Furniture and equipment (“F&E”) and Information Technology (“IT”) grants 12,878 13,393
660,397 592,862
Amortisation (40,919) (35,582)
Grants utilised as at 31 March 619,478 557,280
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS27
14 Deferred capital grants - others 2014/15 2013/14
$’000 $’000
At 1 April 2,825 3,386
Grants utilised on property, plant and equipment 619 542
Total 3,444 3,928
Amortisation (1,165) (1,103)
At 31 March 2,279 2,825
15 Government grants received in advance 2014/15 2013/14
$’000 $’000
Non-current:
F&E and IT grants unutilised as at 1 April 49,373 40,983
Grants received 25,476 25,774
Grants utilised (16,044) (17,384)
F&E and IT grants unutilised as at 31 March 58,805 49,373
Current:
Others 326 187
59,131 49,560
16 Trade and other payables Note 2014/15 2013/14
$’000 $’000
Trade payables 4,629 5,564
Fund manager – 743
Sundry creditors 12,966 10,900
Accruals for property, plant and equipment projects 4 4,098 15,824
Other accruals 15,769 17,773
Deferred income for courses in progress 2,391 2,488
39,853 53,292
17 Operating deficit The item has been arrived at after charging/(crediting):
2014/15 2013/14
$’000 $’000
Contribution to defined contribution plan
included in salaries 21,273 20,274
Exchange gains (33) (24)
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS28
18 Interest income 2014/15 2013/14
$’000 $’000
Current accounts with financial institutions 1,247 915
Debt securities 3,831 4,089
Fixed deposits 1 5
5,079 5,009
19 Investment income 2014/15 2013/14
$’000 $’000
Dividend income from available-for-sale investments 423 655
(Loss)/Gain on disposal of available-for-sale investments (298) 1,731
125 2,386
20 Operating grants - Government Note 2014/15 2013/14
$’000 $’000
Operating grants received/receivable during the year 219,052 214,048
Less:
Operating grants utilised on property, plant and
equipment transferred to deferred capital grants -
Government 13 (90,169) (43,404)
128,883 170,644
During the financial year, the Polytechnic received a grant of $19,611,000 (2014: $18,941,000)
from the Ministry of Education to settle the outstanding goods and services tax payable to the
Inland Revenue Authority of Singapore. This amount has not been included in the operating
grants received from the Government as disclosed above.
21 The Temasek Polytechnic General Education Fund
In November 2002, the Board of Governors of the Polytechnic approved the setup of the
Temasek Polytechnic General Education Fund. The Fund was subsequently granted the
membership by the Ministry of Education under the Education Central Fund. The membership
was renewed for a period of three years with effect from 1 April 2013.
Under this membership, the Polytechnic is allowed to issue tax-deductible receipts to donors for
donations contributed towards Bursary, Scholarship and Awards Fund, Temasek Polytechnic
Endowment Fund and other education related activities which qualify for tax deduction. The
Polytechnic has set up a Management Committee to administer the receipts and disbursement of
the donations given by the donors.
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS29
The financial statements of the Temasek Polytechnic General Education Fund are given below:
2014/15 2013/14
$’000 $’000
Income
Donations received:
Bursaries, scholarships and awards
- Tax deductible 921 575
- Non tax deductible 164 317
General donations 32 56
Donations in-kind 1 7
Interest income 655 380
Deferred capital grant amortised for donated assets 318 314
2,091 1,649
Expenditure
Disbursements:
Endowment Fund (170) (313)
Bursaries, scholarships and awards (882) (964)
General donations (19) (60)
Property, plant and equipment expensed off (1) (7)
Depreciation (318) (314)
(1,390) (1,658)
Net surplus/(deficit) for the year 701 (9)
Accumulated surplus at 1 April 1,434 1,443
Accumulated surplus at 31 March 2,135 1,434
The disbursements were made from donations received in current and prior years.
The reserves set aside are to provide financial stability and to ensure a continuous supply of
funds to meet the objectives of the Fund. The target is to maintain the reserves at a level
equivalent to one year’s disbursements and expenses. The reserves will be used to provide
financial assistance to needy students, scholarships, bursaries, book prizes and for other
education related activities. The Management Committee will review the reserves on a yearly
basis to ensure they are adequate to fulfil the objectives of the Fund.
The donations and disbursements are recorded in the respective funds in the financial
statements.
22 Financial risk management
Overview
The Polytechnic has exposure to the following risks from its use of financial instruments:
credit risk
liquidity risk
interest rate risk
equity price risk
currency risk
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS30
This note presents information about the Polytechnic’s exposure to each of the above risks, the
Polytechnic’s objectives, policies and processes for measuring and managing risk.
Risk management framework
Risk management is integral to the whole business of the Polytechnic. The Polytechnic has a
system of controls in place to create an acceptable balance between the cost of risks occurring
and the cost of managing the risks. The management continually monitors the Polytechnic’s
risk management process to ensure that an appropriate balance between risk and control is
achieved. Risk management policies and systems are reviewed regularly to reflect changes in
market conditions and the Polytechnic’s activities.
Credit risk
Credit risk is the potential loss resulting from the failure of a student or a counterparty to settle
its financial and contractual obligations to the Polytechnic, as and when they fall due.
At the reporting date, there was no significant concentration of credit risk except for
Government grant receivables, funds managed by fund managers and quoted debt securities.
The maximum exposure to credit risk is represented by the carrying amount of each financial
asset in the statement of financial position. Cash and fixed deposits and funds are placed with
banks and financial institutions which are regulated.
The cash with AGD under Centralised Liquidity Management (“CLM”) are placed with high
credit quality financial institutions, and are available upon request.
The average credit period on trade receivable from student fees is 14 to 30 days (2014: 14 to 30
days). No interest is charged on the outstanding trade receivables. The Polytechnic has not
recognised any allowance for doubtful debts as the management are of the view that these
receivables are recoverable.
Included in the Polytechnic’s trade receivable balance are debtors with a carrying amount of
$866,000 (2014: $593,000) which are past due at the reporting date for which the Polytechnic
has not provided as there has not been a significant change in the credit quality and the amounts
are still considered recoverable. The aging profile of the trade receivables are as follows:
Impairment
The ageing of trade and other receivables at the reporting date was:
Gross
2014/15
Impairment
losses
2014/15
Gross
2013/14
Impairment
losses
2013/14
$’000 $’000 $’000 $’000
Neither past due nor impaired 203 – 123 –
Less than 3 months past due 764 – 498 –
3 months to 12 months 63 – 53 –
More than 12 months 39 21 42 –
1,069 21 716 –
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS31
Liquidity risk
The Polytechnic monitors its liquidity risk and maintain a level of cash and cash equivalents
deemed adequate to finance the Polytechnic’s operations and to mitigate the effects of
fluctuations in cash flow.
The total contractual undiscounted cash flow of the Polytechnic’s non-derivative financial
liabilities are the same as their carrying amounts and are due within one year.
Interest rate risk
As the Polytechnic does not have any financial assets and liabilities which bear interest at
floating rates, no sensitivity analysis is prepared.
The interest rates for cash with AGD disclosed in Note 8 to the financial statements are based
on deposit rates determined by the financial institutions with which the cash are deposited and
are expected to move in tandem with market interest rate movements.
Equity price risk
The Polytechnic is exposed to equity risks arising from equity investments classified as
available-for-sale investments. Available-for-sale investments are held for strategic rather than
trading purposes.
Equity price sensitivity
The sensitivity analysis below has been determined based on the exposure to equity price risks
at the reporting date. 10% is the sensitivity rate used when reporting equity price sensitivity
internally to key management personnel and represents management’s assessment of the
possible change in equity price.
In respect of available-for-sale investments, if the market value of the quoted investments had
been 10% higher:
• the Polytechnic’s fair value reserves for the year ended 31 March 2015 would increase by
$12 million (2014: increase by $13 million).
In respect of available-for-sale investments, if the market value of the quoted investments had
been 10% lower:
• the Polytechnic’s fair value reserves for the year ended 31 March 2015 would decrease by
$12 million (2014: increase by $13 million).
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS32
Currency risk
Some of the Polytechnic’s underlying investments are denominated in various foreign
currencies, including United States dollars and Hong Kong dollars. The exchange exposures in
these foreign currency denominated investments are managed by the Polytechnic’s fund
managers through forward foreign exchange contracts. These forward foreign exchange
contracts form part of the respective investment portfolio managed by the fund managers as
disclosed in Note 6 to the financial statements and therefore are not separately disclosed.
Fair value hierarchy
As at 31 March 2015, the Polytechnic has financial instruments measured at fair value. The
different levels have been defined as follows:
• Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;
• Level 2: inputs other than quoted prices included within Level 1 that are observable for
the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and
• Level 3: inputs for the asset or liability that are not based on observable market data
(unobservable inputs).
Level 1 Level 2 Level 3 Total
$’000 $’000 $’000 $’000
31 March 2015
Available-for-sale investments 52,306 – – 52,306
Quoted debt securities
Quoted securities managed by
fund manager
- equity 24,088 – – 24,088
- unit trust/real estate
investment trust 47,070 – – 47,070
123,464 – – 123,464
31 March 2014
Available-for-sale investments
Quoted debt securities 63,556 – – 63,556
Quoted securities managed by fund manager
- equity 19,561 – – 19,561
- unit trust/real estate investment trust 44,621 – – 44,621
127,738 – – 127,738
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS33
Accounting classifications and fair values
Fair values versus carrying amounts
The fair values of financial assets and liabilities, together with the carrying amounts shown in
the statement of financial position are as follows:
Loans and
receivables
Available-
for-sale
Other
financial
liabilities
Total
carrying
amount Fair value
Note $’000 $’000 $’000 $’000 $’000
31 March 2015
Available-for-sale securities 6 – 123,464 – 123,464 123,464
Trade and other receivables 7 8,577 – – 8,577 8,577
Cash and cash equivalents 8 199,765 – – 199,765 199,765
Government grant receivable 14,595 – – 14,595 14,595
222,937 123,464 – 346,401 346,401
Trade and other payables 16 – – (39,853) (39,853) (39,853)
31 March 2014
Available-for-sale securities 6 – 127,738 – 127,738 127,738
Trade and other receivables 7 5,666 – 5,666 5,666
Cash and cash equivalents 8 245,493 – – 245,493 245,493
Government grant receivable 18,332 – – 18,332 18,332
269,491 127,738 – 397,229 397,229
Trade and other payables 16 – – (53,292) (53,292) (53,292)
Estimation fair values
Other financial assets and liabilities
The carrying amounts of financial assets and liabilities with a maturity of less than one year
(including trade and other receivables, cash and cash equivalents, and trade and other payables)
are assumed to approximate their fair values. All other financial assets and liabilities are
discounted to determine their fair values.
23 Other income 2014/15 2013/14
$’000 $’000
Grants and awards 1,344 917
Rental income 1,015 921
School/department income 2,206 1,740
Others 2,013 1,845
6,578 5,423
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS34
24 Commitments 2014/15 2013/14
$’000 $’000
Minimum lease payments under operating leases
included in the statement of comprehensive income 925 1,011
At the reporting date, the Polytechnic has outstanding commitments under non-cancellable
operating leases, which fall due as follows:
2014/15 2013/14
$’000 $’000
Within one year 579 775
After one year but within five years 812 246
1,391 1,021
Operating lease payments represent rentals payable by the Polytechnic for its office premises
and office equipment. Leases are negotiated and rentals are fixed for an average term of 1 to 5
years (2014: 1 to 5 years).
25 Appropriation of accumulated surplus
The Polytechnic received a memorandum from the Ministry of Education dated 3 July 2002
which confirmed that the Ministry of Finance ("MOF") had no objection for the Polytechnic to
retain the unutilised surpluses generated prior to financial year ended 31 March 2001 as
working capital.
With effect from 1 April 2001, the Polytechnic is allowed to retain all the surpluses generated in
accordance with the MOF's circular dated 4 December 2000. The circular was subsequently
replaced by the MOF's circular dated 4 May 2011 which states the same stand on the surplus
retention.
26 Related parties
The Polytechnic is a statutory board domiciled in Singapore under the Temasek Polytechnic Act
(Chapter 323A). As a statutory board, all Government ministries and departments, and statutory
boards are deemed related parties of the Polytechnic.
Some of the Polytechnic’s transactions and arrangements are with related parties and the effect
of these on the basis determined between the parties is reflected in these financial statements.
The balances are unsecured, interest-free and repayable on demand unless otherwise stated.
Temasek Polytechnic
Financial statements
Year ended 31 March 2015
FS35
During the year, the Polytechnic entered into the following transactions with related parties:
2014/15 2013/14
$’000 $’000
Grant/Operating income
Ministry of Education (MOE) 281,617 310,906
Other Ministries and Statutory Boards 4,404 8,333
Expenses
Ministry of Education (MOE) (1,853) (2,137)
Other Ministries and Statutory Boards (887) (1,098)
Key management personnel (792) (276)
Balances due from related parties as at 31 March
Ministry of Education (MOE) 12,047 9,859
Other Ministries and Statutory Boards 2,980 255
Balances due to related parties as at 31 March
Ministry of Education (MOE) 184 5
Other Ministries and Statutory Boards 279 216
Compensation of Directors and key management personnel
Key management personnel of the Polytechnic are those persons having the authority and
responsibility for planning, directing and controlling the activities of the entity. The Principal,
Deputy Principals and Directors are considered as key management personnel of the
Polytechnic.
2014/15 2013/14
$’000 $’000
Short-term benefits 7,555 7,255
Defined contribution plans 319 302