SANDYPORT HOMEOWNERS ASSOCIATION LIMITED NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021 (CONTINUED)

(Expressed in Bahamian dollars)

4. NEW OR REVISED STANDARDS OR INTERPRETATIONS (continued)

IAS8 Definition of Accounting Estimates

In February 2021, IASB issued 'Definition of Accounting Estimates (Amendments to IAS 8)' to help entities to distinguish between accounting policies and accounting estimates. The definition of a change in accounting estimates has been replaced with a definition of accounting estimates. Under the new definition, accounting estimates are “monetary amounts in financial statements that are subject to measurement uncertainty”. Entities develop accounting estimates if accounting policies require items in financial statements to be measured in a way that involves measurement uncertainty. The Homeowners Association does not expect this amendment to have any significant impact on its financial statements."

5. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

a. Foreign currency - Translations in foreign currencies have been converted into Bahamian dollars at the rate of exchange prevailing at the date of each transaction. At the balance sheet date, foreign currency assets and liabilities are translated into Bahamian dollars using year-end rates of exchange; differences arising are included in the statement of maintenance fund for the year.

b. Revenue recognition - Revenue is measured at the fair value of the consideration received or receivable and represents the monthly maintenance fee charged to the homeowners. This fee is based on square footage of the house on each property and owners of empty lots are charged a flat fee.

c. Cash and cash equivalents - Cash and cash equivalents include cash on hand and at bank and short-term deposits which have a maturity period of less than three months.

d. Trade and other receivables - Accounts receivable is stated at cost less provision for doubtful accounts and any impairment losses. Management records provisions when in their opinion, amounts are irrecoverable based on historical performance and solvency of the customer. The provision for doubtful accounts policy is based on accounts that are 360 days old and remains unpaid.