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NOTES TO THE FINANCIAL STATEMENTS
For the Ànancial year ended 31 December 2013
87
Annual Report 2013
F i nanc i a l Statement s
2.
Significant accounting policies
(continued)
2.3
Group accounting
(a)
Subsidiaries
(i)
Consolidation
Subsidiaries are entities (including special purpose entities) over which the Group has power
to govern the financial and operating policies so as to obtain benefits from its activities, generally
accompanied by a shareholding giving rise to a majority of the voting rights. The existence and effect
of potential voting rights that are currently exercisable or convertible are considered when assessing
whether the Group controls another entity. Subsidiaries are consolidated from the date on which
control is transferred to the Group. They are de-consolidated from the date on which control ceases.
In preparing the consolidated financial statements, transactions, balances and unrealised gains on
transactions between group entities are eliminated. Unrealised losses are also eliminated but are
considered an impairment indicator of the asset transferred. Accounting policies of subsidiaries have
been changed where necessary to ensure consistency with the policies adopted by the Group.
Non-controlling interests are that part of the net results of operations and of net assets of a
subsidiary attributable to the interests which are not owned directly or indirectly by the equity holders
of the Company. They are shown separately in the consolidated income statement, statement of
comprehensive income, statement of changes in equity and balance sheet. Total comprehensive
income is attributed to the non-controlling interests based on their respective interests in a subsidiary,
even if this results in the non-controlling interests having a deficit balance.
(ii)
Acquisitions
The acquisition method of accounting is used to account for business combinations by the Group.
The consideration transferred for the acquisition of a subsidiary or business comprises the fair value
of the assets transferred, the liabilities incurred and the equity interests issued by the Group. The
consideration transferred also includes the fair value of any contingent consideration arrangement.
Acquisition-related costs are expensed as incurred.
Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination
are, with limited exceptions, measured initially at their fair values at the acquisition date.
On an acquisition-by-acquisition basis, the Group recognises any non-controlling interest in the
acquiree at the date of acquisition either at fair value or at the non-controlling interest’s proportionate
share of the acquiree’s net identifiable assets.
The excess of (i) the consideration transferred, the amount of any non-controlling interest in the
acquiree and the acquisition-date fair value of any previous equity interest in the acquiree over (ii) the
fair value of the identifiable net assets acquired is recorded as goodwill. Please refer to the paragraph
“Intangible assets - Goodwill on acquisitions” for the accounting policy on goodwill subsequent to
initial recognition.
(iii)
Disposals
When a change in the Group’s ownership interest in a subsidiary results in a loss of control over
the subsidiary, the assets and liabilities of the subsidiary including any goodwill are derecognised.
Amounts previously recognised in other comprehensive income in respect of that entity are also
reclassified to the income statement or transferred directly to retained earnings if required by a
specific Standard.
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