Maxis Berhad
Annual Report 2015
page
92
Notes to the Financial Statements
31 December 2015
3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(d) Intangible assets (continued)
(ii)
Goodwill
Goodwill arises from a business combination and represents the excess of the aggregation of the consideration transferred for
purchase of subsidiaries or businesses, the amount of any non-controlling interest in the acquiree and the fair value of any previously
held equity interest in the acquiree over the fair value of the net identifiable assets acquired.
Goodwill is measured at cost less any accumulated impairment losses. Negative goodwill is recognised immediately in the statement
of profit or loss.
Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.
Goodwill is allocated to cash-generating units (“CGUs”) for the purpose of impairment testing. Goodwill is not amortised but is tested
annually for impairment or more frequently if events or changes in circumstances indicate that it might be impaired. See accounting
policy Note 3(g)(i) on impairment of non-financial assets. Each CGU or a group of CGUs represents the lowest level within the
Group at which goodwill is monitored for internal management purposes and which is expected to benefit from the synergies of the
combination.
(iii) Customer acquisition costs
Expenditures incurred in providing the customer a free or subsidised device including installation costs, provided the customer
signs a non-cancellable contract for a predetermined contractual period of one to two years, are capitalised as intangible assets and
amortised over the contractual period on a straight-line method. Customer acquisition costs are assessed at each reporting date
whether there is any indication that the customer acquisition costs may be impaired. See accounting policy Note 3(g)(i) on impairment
of non-financial assets.
(e) Investments in subsidiaries
In the Company’s separate financial statements, investments in subsidiaries are stated at cost plus the fair value of share options, share
grants and shares acquired, over the Company’s equity instruments for employees (including full-time executive directors) of the subsidiaries
during the vesting period, deemed as capital contribution. See accounting policy Note 3(t)(v) on share-based compensation benefits. Where
an indication of impairment exists, the carrying amount of the investment is assessed and written down immediately to its recoverable
amount. See accounting policy Note 3(g)(i) on impairment of non-financial assets.
(f) Financial instruments
A financial instrument is any contract that gives rise to both a financial asset of one enterprise and a financial liability or equity instrument
of another enterprise.
A financial asset is any asset that is cash, a contractual right to receive cash or another financial asset from another enterprise, a contractual
right to exchange financial instruments with another enterprise under conditions that are potentially favourable, or an equity instrument of
another enterprise.
A financial liability is any liability that is a contractual obligation to deliver cash or another financial asset to another enterprise, or to
exchange financial instruments with another enterprise under conditions that are potentially unfavourable.
