ENRICHING LIVES EXPANDING HORIZONS - Maxis

MAXIS BERHAD
ANNUAL REPORT 2011
121
3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(a) Basis of consolidation (continued)
(i) Subsidiaries (continued)
If the business combination is achieved in stages, the acquisition date fair value of the acquirer’s previously held equity
interest in the acquiree is remeasured to fair value at the acquisition date through the income statement.
Any contingent consideration to be transferred by the Group is recognised at fair value at the acquisition date.
Subsequent changes to the fair value of the contingent consideration that is deemed to be an asset or liability is
recognised in accordance with FRS 139 either in income statement or as a change to other comprehensive income.
Contingent consideration that is classified as equity is not remeasured, and its subsequent settlement is accounted for
within equity.
Goodwill is initially measured as the excess of the aggregate of the consideration transferred and the fair value of noncontrolling
interest over the net identifiable assets acquired and liabilities assumed. If this consideration is lower than the
fair value of the net assets of the subsidiary acquired, the difference is recognised in the income statement. See
accounting policy Note 3(d)(ii) on goodwill.
Inter-company transactions, balances, income and expenses on transactions between Group companies are eliminated.
Profits and losses resulting from inter-company transactions that are recognised in assets are also eliminated. Accounting
policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the
Group.
All earnings and losses of the subsidiary are attributed to the parent and the non-controlling interests, even if the
attribution of losses to the non-controlling interests results in a debit balance in the shareholders’ equity. Profit or loss
attribution to non-controlling interests for prior years is not restated.
Previously, contingent consideration in a business combination was recognised when it was probable that payment
would be made. Acquisition-related costs were included as part of the cost of business combination. Any non-controlling
interest in the acquiree was measured at the non-controlling interest’s proportionate share of the acquiree’s identifiable
net assets. Any adjustment to the fair values of the subsidiary’s identifiable assets, liabilities and contingent liabilities
relating to previously held interests of the Group was accounted for as a revaluation.
Previously, where losses applicable to the non-controlling interests exceeded the non-controlling interests in the
equity of a subsidiary, the excess, and any further losses applicable to the non-controlling interests, were charged against
the Group’s interest. If the subsidiary subsequently reported profits, the Group’s interest was allocated all such profit
until the non-controlling interest share of losses previously absorbed by the Group had been recovered.