Amal Ltd | Annual Report 2021-22 Note 1 Significant accounting policies (continued) t) Earnings per share Earnings per share (EPS) is calculated by dividing the net profit or loss for the period attributable to equity shareholders of the Amal Ltd by the weighted average number of equity shares outstanding during the period. Earnings considered in ascertaining the EPS is the net profit for the period and any attributable tax thereto for the period. For the purpose of calculating diluted EPS, the net profit for the period attributable to equity shareholders of Amal Ltd and the weighted average number of equity shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares. Estimation of uncertainties relating to the COVID-19 pandemic The Group has considered possible effects that may result from the COVID-19 pandemic and Russia-Ukraine war in preparation of these Consolidated Financial Statements, and used relevant internal and external sources of information and expects that these events will not have any material implications on the operations of the Group in the near future. Critical estimates and judgements Preparation of the Consolidated Financial Statements require the use of accounting estimates, judgements and assumptions, which by definition, will seldom equal the actual results. Appropriate changes in estimates are made as the Management becomes aware of changes in circumstances surrounding the estimates. Changes in estimates are reflected in the Consolidated Financial Statements in the period in which changes are made and, if material, their effects are disclosed in the notes to the Consolidated Financial Statements. This Note provides an overview of the areas that involves a higher degree of judgement or complexity and of items that are more likely to be materially adjusted due to estimates and assumptions turning out to be different than those originally assessed. Detailed information about each of these estimates and judgements is included in relevant notes together with information about the basis of calculation for each affected line item in the Consolidated Financial Statements. The areas involving critical estimates or judgements are: i) Estimation for income tax: Note 1 (f) ii) Estimation of useful life of tangible assets: Note 1 (h) iii) Estimation of provision for inventories: Note 1 (m) iv) Allowance for credit losses on trade receivable: Note 1 (k) v) Estimation of defined benefit obligation: Note 1 (s) vi) Impairment: Note 1 (n) Estimates and judgements are continually evaluated. They are based on historical experience and other factors, including expectations of future events that may have a financial impact on the Group and that are believed to be reasonable under the circumstances.
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