Annual Report 2012, PDF - Axiata Group Berhad - Investor Relations

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NOTES TO THEFINANCIAL STATEMENTSFOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2012 (CONTINUED)24. INTANGIBLE ASSETS (CONTINUED)Goodwill Licenses Others TotalGroup RM’000 RM’000 RM’000 RM’000At 1 January 2011 (restated)Cost 7,391,335 400,372 – 7,791,707Accumulated amortisation – (108,712) – (108,712)Accumulated impairment losses (77,497) – – (77,497)Net book value 7,313,838 291,660 – 7,605,498The remaining amortisation period of acquired telecommunication licences with allocated spectrum rights rangefrom five (5) years to fourteen (14) years (2011: six (6) years to fifteen (15) years).(a) Impairment tests for goodwillThe Group undertakes an annual test for impairment of its CGUs identified according to operating segment.The following CGUs, being the lowest level of asset for which the management monitors the goodwill ofthe Group:note 31.12.2012 31.12.2011 1.1.2011RM’000 RM’000 RM’000RestatedMalaysia (i) 4,031,110 4,031,110 4,031,110Indonesia (ii) 3,214,803 3,217,713 3,227,853Sri Lanka (i) 206,720 54,875 54,875Total 7,452,633 7,303,698 7,313,838(i)Key assumptions used in the VIUThe recoverable amount of the Malaysia’s and Sri Lanka’s CGU including goodwill in this test isdetermined based on VIU calculation. Malaysia’s CGU consist of mobile business meanwhile Sri Lanka’sCGUs consist of fixed telecommunication business (consist of fixed telephone, data and infrastructure)and television business respectively. The recoverable amount of Sri Lanka’s CGUs including goodwill inthe previous financial year was determined based on FVLCS calculation.The VIU calculation apply a discounted cash flow model using cash flow projections based on forecastsand projections approved by the management covering a three (3) years periods for the mobilebusiness in Malaysia. These forecasts and projections reflect the management’s expectation of revenuegrowth, operating costs and margins for the Malaysia CGU based on past experience and futureoutlook of the CGU based on internal measurements and monitoring and external sources of information.256
Axiata Group Berhad (242188-H) Annual Report 201224. INTANGIBLE ASSETS (CONTINUED)(a) Impairment tests for goodwill (continued)(i)Key assumptions used in the VIU (continued)Cash flows beyond the third (3 rd ) year for the mobile business in Malaysia and tenth (10 th ) for mobilebusiness and television business in Sri Lanka are extrapolated in perpetuity using estimated terminalgrowth rate which takes into consideration the current Gross Domestic Product, inflation and averagegrowth rate for the telecommunication industry. These rates have been determined with regards toproject growth rates for the market in which the CGU participates and are not expected to exceedthe long term average growth rates for this market.Pre-tax adjusted discount rate applied to the cash flow forecasts are derived from the CGU pre-taxplus a reasonable risk premium at the date of the assessment of the respective CGU to reflect the riskof the CGU.The following assumptions have been applied in the VIU calculations:MalaysiaSri Lanka31.12.2012 31.12.2011 1.1.2011 31.12.2012Pre-tax adjusted discount rate 9.8% 10.0% 10.9% 15.0%Terminal growth rate – – – 3.0%Revenue growth rate 4.0% to 5.7% 3.2% to 4.8% 4.6% to 7.3% 7.9% to 14.2%over 3 years over 3 years over 3 years over 10 yearsBased on the above test, the Malaysia and Sri Lanka CGUs’ goodwill are not impaired as the recoverableamounts exceeds the carrying amounts included in the financial statements.The Group’s review includes an impact assessment of changes in key assumptions. Based on thesensitivity analysis performed, the Board of Directors concluded that no reasonable change in the basecase assumptions would cause the carrying amounts of the CGUs to exceed its recoverable amounts.(ii) Key assumptions used in FVLCSThe recoverable amount of the Indonesia CGUs including goodwill is determined based on FVLCScalculations.The FVLCS calculations are made based on the CGU’s securities market price less the costs of disposalof the securities. The market price as at end of reporting period was used for the calculations.Based on the above test, the Indonesia CGUs’ goodwill are not impaired as the recoverable amountexceeds the carrying amount included in the financial statements.257
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AXIATA GROUP BERHAD (242188-H) ANNU
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PakistanBangladeshIndiaThailandCamb
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CONTENTS006 Financial Calenda
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FinancialCalendar 2012QUARTERLY RES
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Raising The BarAxiata is continuous
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Chairman’sStatementTan Sri Dato
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Chairman’sStatementHIGH GROWTH MA
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President& GCEO’SBusinessReviewDA
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President &GCEO’S Business Review
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Axiata Group Berhad (242188-H) Annu
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Five-yeargroup financial summaryOPE
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Awards andRecognitionIndonesia Serv
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DIRECTORS’RESPONSIBILITY STATEMEN
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DIRECTORS’REPORTSHARE CAPITALDuri
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DIRECTORS’REPORTDIRECTORS’ INTE
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DIRECTORS’REPORTSTATUTORY INFORMA
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STATEMENTS OFCOMPREHENSIVE INCOMEFO
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STATEMENTS OFFINANCIAL POSITIONAS A
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CONSOLIDATED STATEMENT OFCHANGES IN
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STATEMENTS OFCASH FLOWSFOR THE FINA
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NOTES TO THEFINANCIAL STATEMENTSFOR
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Page 208 and 209: NOTES TO THEFINANCIAL STATEMENTSFOR
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STATEMENTBY DIRECTORSPURSUANT TO SE
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INDEPENDENTAUDITORS’ REPORTTO THE
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GroupFinancial Analysiscatering for
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SHAREHOLDINGSTATISTICSAS AT 29 MARC
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SHAREHOLDINGSTATISTICSAS AT 29 MARC
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ADDITIONAL COMPLIANCEINFORMATION3.
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Net Book Value ofLand & BuildingsFo
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GROUPDIRECTORYAxiata Group BerhadAx
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GLOSSARYShare Scheme CommitteeEmplo
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NOTICE OFANNUAL GENERAL MEETINGNOTI
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NOTICE OFANNUAL GENERAL MEETING10.
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EXPLANATORY NOTES TO THE SPECIAL BU
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ADMINISTRATIVE DETAILS FOR THE21ST
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