Annual Report 2023

78 CHINA MERCHANTS PORT HOLDINGS COMPANY LIMITED Independent Auditor’s Report KEY AUDIT MATTERS Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Key audit matter How our audit addressed the key audit matter Accounting for the Group’s interests in associates We identified the accounting for the Group’s interests in associates as a key audit matter due to the significance of these investments to the consolidated financial statements of the Company as a whole. The Group invested in a number of associates whose principal activities include ports and other relevant operations as set out in note 41 to the consolidated financial statements. The Group’s share of profits of associates for the year ended 31 December 2023 was HK$5,269 million, representing approximately 71% of the profit for the year of the Group as disclosed in the consolidated statement of profit or loss and the Group’s interests in its associates were HK$79,861 million as at 31 December 2023, representing approximately 66% of the net assets of the Group as set out in the consolidated statement of financial position. Our procedures in relation to the accounting for the Group’s interests in associates included: ‧ Obtaining an understanding of the associates by reading those financial information collected by the Group from its associates and discussing with their respective management about the financial performance, significant events occurred in the year and the key areas of judgement made in preparing the financial information to identify and assess the risks that are significant to the audit of the Group’s consolidated financial statements; ‧ Meeting with the respective auditors of the associates to discuss their assessment of risks and identification of areas of audit focus to evaluate the appropriateness of their planned work procedures; ‧ Discussing with the respective auditors on their findings from the execution of their planned work procedures and the conclusion from their completion of audit; and ‧ Evaluating the appropriateness of significant consolidation adjustments made by the management of the Group to conform the accounting policies of the associates to those of the Group for like transactions and events in similar circumstances.