FORGING AHEAD - Tradewinds Plantation Berhad

4. SIGNIFICANT ACCOUNTING POLICIES (continued)
4.7 Investments (continued)
(c) Jointly controlled entities (continued)
4.8 Goodwill
Adjustments to the carrying amount may also be necessary for changes in the Group’s proportionate interest
in the jointly controlled entity arising from changes in the jointly controlled entity’s equity that have not been
recognised in the jointly controlled entity’s profit or loss. Such changes include those arising from the revaluation
of property, plant and equipment and from foreign exchange translation differences. The Group’s share of those
changes is recognised directly in equity of the Group.
Upon disposal of such an investment, the difference between the net disposal proceeds and its carrying amount
is included in profit or loss.
Goodwill acquired in a business combination is recognised as an asset at the acquisition date and is initially measured
at cost being the excess of the cost of the business combination over the Group’s interest in the net fair value of the
identifiable assets, liabilities and contingent liabilities. After initial recognition, goodwill is measured at cost less
accumulated impairment losses, if any. Goodwill is not amortised but instead tested for impairment annually or more
frequently if events or changes in circumstances indicate that the carrying amount may be impaired. Gains and losses
on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.
Goodwill arising on acquisition of an associate is the excess of the cost of investment over the Group’s share of the
net fair value of net assets of the associate’s identifiable assets, liabilities and contingent liabilities at the date of
acquisition.
Goodwill relating to the associate is included in the carrying amount of the investment and is not amortised.
4.9 Impairment of non-financial assets
FINANCIAL STATEMENTS
The carrying amounts of assets, except for financial assets (excluding investments in subsidiaries, associates and
jointly controlled entities), inventories, deferred tax assets and non-current assets (or disposal groups) held for sale, are
reviewed at the end of each reporting period to determine whether there is any indication of impairment. If any such
indication exists, the asset’s recoverable amount is estimated.
Goodwill is tested annually for impairment or more frequently if events or changes in circumstances indicate that the
goodwill might be impaired.
The recoverable amount of an asset is estimated for an individual asset. Where it is not possible to estimate the
recoverable amount of the individual asset, the impairment test is carried out on the cash generating unit (‘CGU’) to
which the asset belongs. Goodwill acquired in a business combination is from the acquisition date, allocated to each
of the Group’s CGU or groups of CGU that are expected to benefit from the synergies of the combination giving rise
to the goodwill irrespective of whether other assets or liabilities of the acquiree are assigned to those units or groups
of units.
TRADEWINDS PLANTATION BERHAD
Annual Report 2010
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