Evaluation of CapitaLand Limited Sustainability Reporting and Segmental Reporting under IFRS 8

This report evaluates CapitaLand Limited's sustainability reporting and compliance with IFRS 8 segmental reporting. It analyzes the company's sustainability commitment, management and staff involvement, materiality, stakeholder involvement, human capital, and community development investment and value. The report also examines CapitaLand Limited's operating segments, including CapitaLand Singapore, CapitaLand China, CapitaLand Mall Asia, CapitaLand Vietnam, and The Ascott Ltd. Finally, the report assesses the usefulness of CapitaLand Limited's reporting to its users.

Running head: ADVANCE FINANCIAL ACCOUNTING
Advance Financial Accounting
Name of the Student
Name of the University
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Table of Contents
Introduction:...............................................................................................................................3
Sustainability Reporting:............................................................................................................3
Understanding Sustainability Reporting:...............................................................................3
GRI Sustainability Reporting Standards:...............................................................................4
Sustainability reporting of CapitaLand Limited:.......................................................................4
Sustainability Commitment....................................................................................................4
Management Commitment and Staff Involvement:...............................................................5
Materiality:.............................................................................................................................6
Stakeholder Involvement:......................................................................................................6
Human Capital:......................................................................................................................7
Community Development Investment and Value:.................................................................7
Understanding segmental reporting:..........................................................................................7
Operating Segment of CapitaLand Limited:..........................................................................8
CapitaLand Singapore:...........................................................................................................9
CapitaLand China:.................................................................................................................9
CapitaLand Mall Asia............................................................................................................9
CapitaLand Vietnam:...........................................................................................................10
The Ascott Ltd:....................................................................................................................10
Usefulness to Users:.................................................................................................................11
Conclusion:..............................................................................................................................11
References................................................................................................................................13

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Introduction:
The current report is based on evaluating CapitaLand Limited reporting standards as
whether the company complies with the Global Reporting Initiative and IFRS 8 operating
segments. The report would also evaluate CapitaLand Limited usefulness of reporting to its
users. To commence with the corporate profit of CapitaLand Limited it is regarded the Asia’s
as one of the chief real estate businesses. The company has headquarters and listings on the
Singapore stock exchange.
CapitaLand Limited is the owners and the manager of international portfolio having
worth as high as S$88 billion as on 31st December 2017. The portfolio usually comprised of
combined expansions, grocery shopping malls, homes, offices, serviced residence, investment
in real estate trust and funds (CapitaLand, 2018). CapitaLand Limited has presence in as
much as 150 metropolises in more than 30 nations. The company places emphasis on the
Singapore and China as the essential markets with continuous expansion in the international
marketplaces of Vietnam and Indonesia.
The company gains significant economic advantage through its base of assets and
widespread network of marketplace. In combination with exclusive designs, growth and
operating abilities, CapitaLand Limited creates and administers real estate products and
services of higher quality. CapitaLand Limited is also regarded as one of the major
investment venture managing business in Asia with a steady of five REITs which is
registered in Malaysia and Singapore stock exchange.
Sustainability Reporting:
Understanding Sustainability Reporting:
Sustainability reporting refers to reports that are published by the organizations
regarding the economic, environmental and social impact caused by the company on the daily

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activities (Ioannou & Serafeim, 2017). The sustainability reports provide the organizations
with the standards and supremacy model which exhibits the association amid the
organizations policy and obligation towards sustainable international economy.
GRI Sustainability Reporting Standards:
The GRI Sustainability reporting standards assist the trades, governments and other
administrations in understanding and communicating the effect of the trade on the serious
issues of sustainability (Lewellyn & Logsdon, 2017). There are certain characteristic
components of the GRI standards and the activities that makes them, this includes;
a. Multi-stakeholder input,
b. The records of custom and endorsement
c. Government references and activities
d. Independence
e. Shared development costs
Sustainability reporting of CapitaLand Limited:
Sustainability Commitment
The sustainability strategy of CapitaLand Limited is allied with the company’s
doctrine of Building People and Building Communities. The company is evidently company
towards enhancing the economic and communal welfare of its stakeholders by evolving its
projects and administering its functional processes (CapitaLand, 2018). In the present age of
evolving business landscape, CapitaLand Limited actively embraces innovations to make
sure that commercial viability is followed without jeopardizing the future generation’s
environment.
In compliance with the GRI Standards, CapitaLand Limited endorses a higher
corporate governance standards and transparency to protect the interest of the shareholders.

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The company has placed adequate end actual business risk administration framework to
improve the commercial flexibility and agility (Del Mar et al., 2015). The company has
adopted proactive approach relating to environmental, well-being and security administration
that integrates worldwide designs in its development. Furthermore, the company has adopted
cohesive strategy of human capital that purposes to employee, grow and stimulate the
workforces to generate progress for the organization.
Commitment of Management and Staff Involvement:
The sustainability administration of the CapitaLand Limited falls under the purview
of the company’s sustainability council that consists of the top management (Fassin, 2015).
The company is maintained by the Sustainability Steering Committee that monitors two
working groups to make sure that the company continues to advance and improve in the areas
of ESG. The board of directors of CapitaLand Limited is regularly updated by the
commission on materials related to sustainability risks and corporate misconduct events if
any that originates.

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Figure 1: Figure representing Sustainability Management Structure
(Source: CapitaLand, 2018)
Materiality:
CapitaLand Limited on regular occasion reviews the material issues that forms the
significant part to the company and its stakeholders. This is usually prioritized depending
upon the likelihood and probable effect on the issues that impacts the continuity of business
and development (Lewellyn & Logsdon, 2016). CapitaLand Limited places emphasis on the
external stakeholders to prioritize the issues that are important to the society (Lozano et al.,
2016). CapitaLand Limited regularly reviews the material risks and corresponds with the
internal control. This includes the below stated feedback procedures;
Environment:
a. Actively participating in the green building council
b. Regularly obtaining feedback from the government agencies
Social:
a. Regularly engaging in dialogue with the government agencies
b. Constant survey on employee engagement
Governance:
a. Regularly engaging with the securities investors association
Stakeholder Involvement:
CapitaLand Limited for effective flow of information regularly engages with its
employees through numerous avenues and sessions. This helps in aligning with the business
goals across all level of workforce (Ceulemans et al., 2015). The company proactively
indulges with its suppliers and contractors on areas associated to work quality and

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commitment towards environmental health safety. CapitaLand Limited actively participates
in the stakeholder consultations that is actively organized by the government agencies in
order to furnish feedback relating to the proposed changes effecting the company’s business.
Human Capital:
The company is committed towards workplace excellence for its personnel and has
cohesive strategy of human capital to develop, employee and encourage personnel. The
company promotes diversity in numerous aspects that includes different nationalities, cultures
and languages (Junior et al., 2014). The company states that irrespective of the culture, age or
gender and workers can create a noteworthy influence depending upon their skill and
knowledge. The multi-stakeholder engagement provides the combination of expertise and
diversities of experience in addressing the needs of the report makers and users.
Community Development Investment and Value:
CapitaLand Limited sustainability strategy places key focus on the community
development. This has resulted in generation of strong community capital and goodwill for
the company in its social operations (Calabrese et al., 2016). CapitaLand Limited supports
numerous stakeholder involvement that includes environmental sustainability, health and
safety, social integration and lending support to the underprivileged children. The business
obeys to the moral code and code of business conduct that is associated in dealing with issues
namely the confidentiality and work place discipline.
Segmental Reporting:
Understanding segmental reporting:
Segmental reporting under IFRS 8 can be defined as reporting of the operating
segments of the organizations in the revelations that accompany the financial statements
(Cuccia, 2018). The objective of segmental reporting is to provide information to its investors

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and credits relating to the financial results and positions of the vital operating units of the
organization that forms the basis of decision making.
Operating Segment of CapitaLand Limited:
The operating segments represents the component of CapitaLand Limited that
indulges in commercial activities through which the company derive proceeds and sustain
expenditure along with the revenues and expenditure that is associated with the transactions
with any of the CapitaLand Limited other components (Leung & Verriest, 2015). The
operating segments of CapitaLand Limited is reported in way that it is an agreement with the
internal reporting given by the main operating segments.
The management of CapitaLand Limited administers the functioning outcomes for
every business unit with the objective of decision making on resource allocations and
valuation of performance (André et al., 2016). The performance of CapitaLand Limited is
usually measured on the basis of the segment earnings before interest and taxation.
CapitaLand Limited uses the EBIT as the tool for measuring the performance since the
administration have confidence in such material forms the most appropriate in assessing the
outcomes of the specific segments that are relative to the other companies operating in the
industry.
Geographically, the CapitaLand Limited management assesses the business
performance of business in Singapore, China, Other Asia, Europe and others. CapitaLand
Limited presents the information on geographical segments based on the segmental revenues
and EBIT that are related to the geographical location of the customers (CapitaLand, 2018).
The non-current assets and the total assets are classified on the basis of the geographical
locations of the assets.

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The management of CapitaLand Limited regulates the operating segments depending
upon the information that are reviewed and used by Executive management meeting for the
purpose of tactical decision making and distribution of resources (Aleksanyan & Danbolt,
2015). For management purpose, CapitaLand Limited is organized into the premeditated
business elements based on the company’s goods, facilities and geography. The company has
four chief businesses which includes, CapitaLand Singapore, CapitaLand China, CapitaLand
Mall Asia and The Ascott Ltd. The reportable operating segments of CapitaLand Limited
includes
CapitaLand Singapore:
The owners and the managers of commercial properties develops the residential
properties for sale. In 2017, the company sold 407 residential units and generated total sales
revenues of S$1.48 billion (CapitaLand, 2018). The segmental reporting states that
CapitaLand Limited formed a joint project with Malaysian third party in order to create 500
units of the domestic homes. The company made an external revenue of S$1,176,924 with
inter segment revenue standing S$13,535.
CapitaLand China:
During the year 2017, CapitaLand Limited china continued its growth in China
through the help of acquisition and integrated development strategies (CapitaLand, 2018).
During 2017, CapitaLand China sold around 8,497 residential units with total external
revenue of S$1,356,156 and inter segment revenue of S$21,000. The total revenue from the
CapitaLand China segment stood S$1,356,177.
CapitaLand Mall Asia
In the recently concluded financial year of 2017, CapitaLand retail network consisted
of 103 shopping malls in Singapore, China, Japan and Malaysia. The malls of CapitaLand

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have constantly performed well in the core Singapore markets and have recorded a rise in the
net property income (CapitaLand, 2018). The total external revenue of S$1,032,368 and inter
segment revenue of S$1,338. The total revenue from the CapitaLand Mall Asia segment
stood S$1,033,706.
CapitaLand Vietnam:
The financial year of 2017 marked the record growth for the CapitaLand Vietnam as
the company recorded the highest value of home sales (CapitaLand, 2018). CapitaLand
Limited made the strategic inroads further than the residential markets and expanded its
footprints in Vietnam with the acquisition of first prime commercial assets.
The Ascott Ltd:
The Ascott Ltd possesses and administers the portfolio of quality serviced residences
acorss 128 cities having presence in 32 nations. The segmental reporting of Ascott Ltd
provides that the company recorded the strongest year of growth as it added more than 24,000
units into its portfolio (CapitaLand, 2018). The operational unit of Ascott Ltd made S$119
revenue per available unit. The total external revenue of S$998,286 and inter segment
revenue of S$1,909. The total revenue from the Ascott Ltd segment stood S$1,000,195.

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Figure 2: Figure reporting Operating Segments of CapitaLand Limited
(Source: CapitaLand, 2018)
The above table represents that the entity wide disclosure required by the IFRS 8 for
CapitaLand Limited is up to the extent that the concerned information is not disclosure
anywhere else.
Usefulness to Users:
If the monetary information is considered to be valuable, then it should be appropriate
and authentically presents what it purports to represents. The usefulness of the fiscal info is
improved if it is similar, demonstrable and comprehensible. Similarly for CapitaLand Limited
the financial information presented is useful to the users in making a differences in decision
since the information presented by CapitaLand Limited has confirmatory value (Gotti, 2016).
The financial reports of CapitaLand Limited presents economic phenomena in terms of words
and numbers. It is useful to the users since the reports not only presents the relevant

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phenomena but also faithfully presents the phenomena that CapitaLand Limited purports to
present.
The company provides a complete depictions of all the information relating to the
assets by describing the nature of the assets along with the numerical depiction of all the
assets (André et al., 2016). The information presented by CapitaLand Limited is useful in
making comparative decision for the users in choosing between the alternatives. The financial
information presented by CapitaLand Limited is useful to the users since it is comparable,
verifiable and understandable and possess the elements of timeliness.
Conclusion:
On a conclusive note, it can be stated that CapitaLand Limited is one of the first
businesses in Singapore that have willingly published the sustainability reports in accordance
with the GRI guidelines. The sustainability report also comprises of the organization
approach in assimilating the concept of sustainability into its policies, administration and
functions.
CapitaLand Limited sustainability also reflects the social financial and environmental
characteristics of the company’s operations and development. CapitaLand Limited continues
to prepare the sustainability report by adhering with GRI standards and adheres with the IFRS
8 to report about the operating segments of its international portfolio.

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References
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better?. Accounting in Europe, 12(1), 37-60.
André, P., Filip, A., & Moldovan, R. (2016). Segment Disclosure Quantity and Quality under
IFRS 8: Determinants and the Effect on Financial Analysts' Earnings Forecast
Errors. The International Journal of Accounting, 51(4), 443-461.
Calabrese, A., Costa, R., Levialdi, N., & Menichini, T. (2016). A fuzzy analytic hierarchy
process method to support materiality assessment in sustainability reporting. Journal
of Cleaner Production, 121, 248-264.
CapitaLand. (2018). Retrieved from https://www.capitaland.com/international/en.html
Ceulemans, K., Molderez, I., & Van Liedekerke, L. (2015). Sustainability reporting in higher
education: a comprehensive review of the recent literature and paths for further
research. Journal of Cleaner Production, 106, 127-143.
Cuccia, A. (2018). Potential of IFRS 8: Managerial" customization", relevance of subsidiaries
and separate financial statements. FINANCIAL REPORTING.
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Diffusion of sustainability reporting in universities: current situation and future
perspectives. Journal of Cleaner Production, 106, 144-154.
Fassin, Y. (2015, July). The Status of CSR and Sustainability Reporting at Universities in
Europe: a Survey. In Proceedings of the International Association for Business and
Society (Vol. 26, pp. 179-191).

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Gotti, G. (2016). Discussion of Segment Disclosure Quantity and Quality under IFRS 8:
Determinants and the Effect of Financial Analysts' Earnings Forecast Errors. The
International Journal of Accounting, 51(4), 462-463.
Ioannou, I., & Serafeim, G. (2017). The consequences of mandatory corporate sustainability
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1-11.
Leung, E., & Verriest, A. (2015). The impact of IFRS 8 on geographical segment
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Lewellyn, P. G., & Logsdon, J. M. (2016, July). How Sustainability Reporting Is Maturing: A
Preliminary Assessment of the Impact of GRI’s G4 Guidelines. In Proceedings of the
International Association for Business and Society (Vol. 27, pp. 122-132).
Lewellyn, P. G., & Logsdon, J. M. (2017). Global Reporting Initiative G4 Sustainability
Reporting Guidelines.
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Sustainability Reports | CapitaLand. (2018). Retrieved from
https://www.capitaland.com/international/en/about-capitaland/sustainability/
sustainability-reports.html

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