The acquisition method of accounting is used to account for all business combinations, regardless of whether equity instruments or other assets are acquired. The consideration transferred for the acquisition of a subsidiary comprises the:
| · | fair values of the assets transferred; | |
| · | liabilities incurred to the former owners of the acquired business; | |
| · | equity interests issued by the group; | |
| · | fair value of any asset or liability resulting from a contingent consideration arrangement; and | |
| · | fair value of any pre-existing equity interest in the subsidiary. |
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. The group recognizes any non-controlling interest in the acquired entity on an acquisition-by-acquisition basis either at fair value or at the non-controlling interest’s proportionate share of the acquired entity’s net identifiable assets.
Acquisition-related costs are expensed as incurred.
The excess of the
| · | consideration transferred, | |
| · | amount of any non-controlling interest in the acquired entity, and | |
| · | acquisition-date fair value of any previous equity interest in the acquired entity |
over the fair value of the net identifiable assets acquired is recorded as goodwill. If those amounts are less than the fair value of the net identifiable assets of the business acquired, the difference is recognized directly in profit or loss as a bargain purchase.