Frontkn Berhad Annual Report 2015

FRONTKEN CORPORATION BERHAD

(651020-T)

ANNUAL REPORT

2015

SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

Basis of Consolidation (Cont’d)

(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.

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.

(d) Loss of Control

Upon the loss of control of a subsidiary, the Group recognises any gain or loss on disposal in profit or loss which

is calculated as the difference between:-

(i)

the aggregate of the fair value of the consideration received and the fair value of any retained interest in the

former subsidiary; and

(ii) the previous carrying amount of the assets (including goodwill), and liabilities of the former subsidiary and any

non-controlling interests.

Amounts previously recognised in other comprehensive income in relation to the former subsidiary are accounted

for in the same manner as would be required if the relevant assets or liabilities were disposed of (i.e. reclassified

to profit or loss or transferred directly to retained profits). The fair value of any investments retained in the former

subsidiary at the date when control is lost is regarded as the fair value on initial recognition for subsequent

accounting under MFRS 139 or, when applicable, the cost on initial recognition of an investment in an associate

or a joint venture.

Intangible Assets

Intangible assets, other than goodwill, that are acquired by the Group, which have finite useful lives, are measured at

cost less any accumulated amortisation and any impairment losses.

NOTES TO THE FINANCIAL STATEMENTS

(cont’d)