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27. ASSOCIATES (CONTINUED)(ii)Axiata’s DirectorsAxiata will have the right to:• nominate to, and/or remove or replace from, the Board, one Director; and• nominate and/or remove or replace the Nominee Director as a member of the Audit Committee ofIdea.(iii)Proceedings of the Audit CommitteeIdea will cause full details of all transfer or obligations or any other material transactions or arrangementsbetween Idea and any of its affiliates regardless of whether or not a price is charged to be disclosed to theAudit Committee at least once every quarter. If the Audit Committee raises any concern in relation to suchrelated party transactions, Idea will act in accordance with the recommendation of the Audit Committee.Based on the above, the Group has reassessed the status of its interest in Idea in which the Board, havingconsidered item (i), (ii) and (iii) as mentioned above has resolved that the Group is deemed to be able to exercisesignificant influence over the operational and financial policies of Idea notwithstanding the current stake of 14.99%and have equity accounted Idea with effect from 25 June 2009.In accordance with the Proposed Merger as disclosed in Note 37(a) to the financial statements, upon thecompletion, the Group will have an equity interest of approximately 19.10% (or 19.00% on a fully diluted basis) inthe merged Idea Group. The Group’s equity interest in Idea remains at 14.99% as at 31 December 2009.(b)The Group and the Company have undertaken the test for impairment of its investments in Idea, SamartCorporation Public Company Limited (“Samart”) and MobileOne Ltd (“M1”). The test of impairment of Idea wasperformed on a merged basis with Spice following the status of the proposed merger as disclosed in Note 37(a)to the financial statements. No impairment loss was required for the carrying amount of investment in Idea, Samartand M1 assessed as at 31 December 2009 as their recoverable amounts were in excess of their carrying amounts.The investments in Idea, Samart and M1 are identified as the Group’s and the Company’s cash-generating units.(i)Key assumptions used in the VIU calculationsThe recoverable amount of the cash-generating unit is determined based on VIU calculations. This VIUcalculation apply a discounted cash flow model using cash flow projections based on forecasts and projectionsapproved by management covering ten (10) years for Idea, five (5) years for M1 and three (3) years forSamart. These forecasts and projections reflect management’s expectation of revenue growth, operatingcosts and margins for the cash-generating unit based on current assessment of market share, expectationsof market growth and industry growth.Cash flows beyond the tenth (10 th ) year for the mobile business in India, fifth (5 th ) year for Singapore andthird (3 rd ) year for Thailand are extrapolated in perpetuity using estimated terminal growth rates which takesinto consideration the current GDP, inflation and average growth rate for the telecommunication industry.These rates have been determined with regards to projected growth rates for the respective markets inwhich the cash-generating units participate and are not expected to exceed the long term average growthrates for those markets.Annual Report 2009 • 243