62
FRONTKEN CORPORATION BERHAD
(651020-T)
ANNUAL REPORT 2014
NOTES TO THE
FINANCIAL STATEMENTS
(cont’d)
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
Basis of Consolidation
The consolidated financial statements include the financial statements of the Company and its subsidiaries
made up to the end of the reporting period.
Subsidiaries are entities (including structured entities) controlled by the Group. The Group controls an entity
when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has
the ability to affect those returns through its power over the entity.
Subsidiaries are consolidated from the date on which control is transferred to the Group up to the effective
date on which control ceases, as appropriate.
Intragroup transactions, balances, income and expenses are eliminated on consolidation. Where necessary,
adjustments are made to the financial statements of subsidiaries to ensure consistency of accounting policies
with those of the Group.
(a)
Business Combinations
Acquisitions of businesses are accounted for using the acquisition method. Under the acquisition
method, the consideration transferred for acquisition of a subsidiary is the fair value of the assets
transferred, liabilities incurred and the equity interests issued by the Group at the acquisition date.
The consideration transferred includes the fair value of any asset or liability resulting from a contingent
consideration arrangement. Acquisition-related costs, other than the costs to issue debt or equity
securities, are recognised in profit or loss when incurred.
In a business combination achieved in stages, previously held equity interests in the acquiree are
remeasured to fair value at the acquisition date and any corresponding gain or loss is recognised in
profit or loss.
Non-controlling interests in the acquiree may be initially measured either at fair value or at the non-
controlling interests’ proportionate share of the fair value of the acquiree’s identifiable net assets at the
date of acquisition. The choice of measurement basis is made on a transaction-by-transaction basis.
(b) Non-Controlling Interests
Non-controlling interests are presented within equity in the consolidated statement of financial position,
separately from the equity attributable to owners of the Company. Profit or loss and each component
of other comprehensive income are attributed to the owners of the Company and to the non-controlling
interests. Total comprehensive income is attributed to non-controlling interests even if this results in
the non-controlling interests having a deficit balance.
At the end of each reporting period, the carrying amount of non-controlling interests is the amount of
those interests at initial recognition plus the non-controlling interests’ share of subsequent changes in
equity.
(c)
Changes In Ownership Interests In Subsidiaries Without Change of Control
All changes in the parent’s ownership interest in a subsidiary that do not result in a loss of control are
accounted for as equity transactions. Any difference between the amount by which the non-controlling
interest is adjusted and the fair value of consideration paid or received is recognised directly in equity
of the Group.
