108 Huawei Investment & Holding Co., Ltd.
Non-monetary assets and liabilities that
are measured in terms of historical cost
in a foreign currency are translated using
the foreign exchange rates ruling at the
transaction dates. Non-monetary assets and
liabilities denominated in foreign currencies
that are stated at fair value are translated
using the foreign exchange rates ruling at the
dates the fair value was measured.(ii) Foreign operations
The results of foreign operations, except
for foreign operations in hyperinflationary
economies, are translated into the presentation
currency of the Group (CNY) at the exchange
rates approximating the foreign exchange
rates ruling at the dates of the transactions.
Statement of financial position items are
translated into CNY at the closing foreign
exchange rates at the end of the reporting
period. The resulting exchange differences are
recognised in other comprehensive income
and accumulated separately in equity in
the translation reserve. If the operation is
a non-wholly-owned subsidiary, then the
relevant proportionate share of the translation
difference is allocated to the non-controlling
interests.The results and financial position of foreign
operations in hyperinflationary economies
are translated to CNY at the exchange rates
ruling at the end of the reporting period.
Prior to translating the financial statements
of foreign operations in hyperinflationary
economies, their financial statements for
the current year are restated to account for
changes in the general purchasing power of
the local currencies. The restatement is based
on relevant price indices at the end of the
reporting period.When a foreign operation is disposed of in
its entirety or partially such that control,
significant influence or joint control is lost, the
cumulative amount in the translation reserve
related to that foreign operation is reclassified
to profit or loss as part of the gain or loss on
disposal.(t) Borrowing costs
Borrowing costs that are directly attributable
to the acquisition, construction or production
of an asset which necessarily takes asubstantial period of time to get ready for its
intended use or sale are capitalised as part of
the cost of that asset. Other borrowing costs
are expensed in the period in which they are
incurred.4 Changes in significant accounting
policies
The Group initially applied IFRS 16 Leases from
January 1, 2019. A number of other new standards
are effective from January 1, 2019, but they do not
have a material effect on the Group’s consolidated
financial statements.The Group has applied IFRS 16 using the
modified retrospective approach, under which
the cumulative effect of initial application is to
be recognised in retained earnings at January 1,- Accordingly the comparative information
presented for 2018 has not been restated – i.e. it
is presented, as previously reported, under IAS 17,
Leases and related interpretations. Additionally,
the disclosure requirements in IFRS 16 have
not generally been applied to comparative
information.
The main changes resulting from adoption of IFRS
16 are disclosed below.Definition of a lease
Previously, the Group determined at contract
inception whether an arrangement was or
contained a lease under IFRIC 4 Determining
Whether an Arrangement Contains a Lease. The
Group now assesses whether a contract is a lease
based on the definition of a lease, as explained in
note 3(j).As a lessee
Before January 1, 2019, the Group classified
leases as operating or finance leases based on
its assessment of whether the lease transferred
substantially all of the risks and rewards of
ownership to the Group as a lessee. After the
adoption of IFRS 16, the Group recognises
right-of-use assets and lease liabilities from the
commencement date of the lease for all leases
except for short-term leases (lease terms of 12
months or less) and leases of low-value assets
(which are typically of low-value when new, such
as printers and photocopiers).