57
NOTES TO THE FINANCIAL STATEMENTS
For the financial year ended 31 December 2014
2.
Summary of significant accounting policies (cont’d)
2.9
Impairment of non-financial assets
The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication
exists, or when an annual impairment testing for an asset is required, the Group makes an estimate of the asset’s recoverable
amount.
An asset’s recoverable amount is the higher of an asset’s or cash-generating unit’s fair value less costs of disposal and its value
in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent
of those from other assets or groups of assets. Where the carrying amount of an asset or cash-generating unit exceeds its
recoverable amount, the asset is considered impaired and is written down to its recoverable amount.
Impairment losses of continuing operations are recognised in profit or loss, except for assets that are previously revalued
where the revaluation was taken to other comprehensive income. In this case, the impairment is also recognised in other
comprehensive income up to the amount of any previous revaluation.
A previously recognised impairment loss is reversed only if there has been a change in the estimates used to determine the
asset’s recoverable amount since the last impairment loss was recognised. If that is the case, the carrying amount of the asset
is increased to its recoverable amount. That increase cannot exceed the carrying amount that would have been determined,
net of depreciation, had no impairment loss been recognised previously. Such reversal is recognised in profit or loss unless the
asset is measured at revalued amount, in which case the reversal is treated as a revaluation increase.
2.10
Subsidiaries
A subsidiary is an investee that is controlled by the Group. The Group controls an investee when it is exposed, or has rights,
to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the
investee.
In the Company’s separate financial statements, investments in subsidiaries are accounted for at cost less impairment losses.
2.11
Joint venture and associate
A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net
assets of the arrangement. Joint control is the contractually agreed sharing of control of an arrangement, which exists only
when decisions about the relevant activities require the unanimous consent of the parties sharing control.
An associate is an entity, not being a subsidiary or a joint venture, over which the Group has the power to participate in the
financial and operating policy decisions of the investee but does not have control or joint control of those policies.
The Group accounts for its investments in associate and joint venture using the equity method from the date on which it
becomes an associate or joint venture.
Under the equity method, the investment in associate or joint venture are carried in the balance sheet at cost plus post-
acquisition changes in the Group’s share of net assets of the associate or joint venture. The profit or loss reflects the share
of results of the operations of the associate or joint venture. Distributions received from joint venture or associate reduce
the carrying amount of the investment. Where there has been a change recognised in other comprehensive income by the
associate or joint venture, the Group recognises its share of such changes in other comprehensive income. Unrealised gains
and losses resulting from transactions between the Group and associate or joint venture are eliminated to the extent of the
interest in the associate or joint venture.
When the Group’s share of losses in an associate or joint venture equals or exceeds its interest in the associate or joint venture,
the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the associate
or joint venture.
