178 Annual Report 2025 NOTES TO THE FINANCIAL STATEMENTS 1 GENERAL INFORMATION (CONTINUED) 1.3 Standards issued but not yet effective At the date of authorisation of these financial statements, the Group and Company have not applied the following SFRS(I) pronouncements that have been issued but are not yet effective: Effective for annual periods beginning on or after 1 January 2026 • Annual Improvements to SFRS(I) – Volume 11 • Amendments to SFRS(I) 9 and SFRS(I) 7: Amendments to the Classification and Measurement of Financial Instruments Effective for annual periods beginning on or after 1 January 2027 • SFRS(I) 18 Presentation and Disclosure in Financial Statements Management anticipates that the adoption of the above SFRS(I)s, SFRS(I) INTs and amendments to SFRS(I) in future periods will not have a material impact on the financial statements of the Group and of the Company in the period of their initial adoption except for the following: SFRS(I) 18 Presentation and Disclosures in Financial Statements Management anticipates the initial application of the new SFRS(I) 18 will result in changes to the structure and presentation of the Group’s consolidated statement of comprehensive income, consolidated statement of cash flows, as well as additional disclosures required for management-defined performance measures (“MPMs”). The Group is currently performing a detailed impact assessment, including re-mapping its chart of accounts, evaluating the classification of income and expense items under the new operating, investing and financing categories, and analysing the expected effects of reconciling items for MPMs. As this assessment is still in progress, the Group is not yet able to reliably quantify the impact of applying SFRS(I) 18 on its financial statements. The Group does not intend to early adopt SFRS(I) 18. 1.4 Critical accounting judgements and key sources of estimation uncertainty (i) Critical judgements made in applying the Group’s material accounting policies Information about critical judgements in applying the Group’s material accounting policies that have the most significant effect on the amounts recognised in the financial statements is discussed below. Business combinations Determining whether an acquisition meets the definition of a business combination requires judgement to be applied on a case-by-case basis. Acquisitions are assessed under the relevant SFRS(I) 3 Business Combinations criteria (whether the set of assets and activities acquired includes, at a minimum, an input and substantive process and whether the acquired set has the ability to produce output) to establish whether the transaction represents a business combination or an asset acquisition. Depending on the specific facts, acquisitions of exploration and evaluation licences for which a development decision has not yet been made, have largely been concluded to represent asset acquisition. Acquisition accounting is subject to substantive judgement by management. The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability. The fair value of oil fields in the production and development phase is normally based on discounted cash flow models, where the determination of inputs to the model may require significant judgement. The fair value of the assets or liabilities acquired at the date of acquisition is disclosed in Notes 4 and 30 to the financial statements.
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