| (3) |
Business Combinations |
| (a) |
Business combinations |
In accordance with IFRS 3 Business Combinations, each identifiable asset and liability is measured at its acquisition date fair value except for the following:
| – |
Deferred tax assets or liabilities which are recognized and measured in accordance with IAS 12 Income Taxes; and |
| – |
Employee benefit arrangements which are recognized and measured in accordance with IAS 19 Employee Benefits |
Leases and insurance contracts are classified on the basis of the contractual terms and other factors at the inception of the contract or at the date of modification, which could be the acquisition date if the terms of the contract have been modified in a manner that would change its classification.
Contingent liabilities assumed in a business combination are recognized when such liabilities are present obligations and their fair value can be measured reliably.
The consideration transferred in a business combination is measured at fair value, which is calculated as the sum of the acquisition-date fair values of the assets transferred by the acquirer, the liabilities incurred by the acquirer to former owners of the acquiree and the equity interests issued by the acquirer. Acquisition-related costs are costs the acquirer incurs to effect a business combination. Those costs include finder’s fees; advisory, legal, accounting, valuation and other professional or consulting fees; general administrative costs, including the costs of maintaining an internal acquisitions department; and costs of registering and issuing debt and equity securities. Acquisition-related costs, other than those associated with the issue of debt or equity securities, are expensed in the periods in which the costs are incurred and the services are received.
The Group measures goodwill at the acquisition date as:
| – |
the fair value of the consideration transferred; plus |
| – |
the recognized amount of any non-controlling interest in the acquiree; plus |
| – |
if the business combination is achieved in stages, the fair value of the pre-existing equity interest in the acquiree; less |
| – |
the net recognized amount (generally fair value) of the identifiable assets acquired and liabilities assumed. |
Subsequent to initial recognition, goodwill is measured at cost less any accumulated impairment losses.
| (b) |
Business combinations under common control |
A business combination involving entities or businesses under common control is a business combination in which all of the combining entities or businesses are ultimately controlled by the same party or parties both before and after the business combination, and in which control is not transitory. The Group has accounted for the acquisition of business combination under common control based on the carrying amounts recorded in the consolidated financial statements of the acquired companies. The financial statements of acquired companies have been retrospectively consolidated as part of the Group’s consolidated financial statements as if the acquisition of acquired companies had occurred on the date of its original acquisition by the common control group, regardless of the actual date of acquisition by the Group.