Annual Report 2016
77
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED MARCH 31, 2016
3.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
– continued
Investments in subsidiaries
Investments in subsidiaries included in the Company’s statement of financial position are carried at
cost less any impairment loss.
Business combinations
Acquisitions of businesses are accounted for using the acquisition method. 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 Group, liabilities incurred by
the Group to the former owners of the acquiree and the equity interests issued by the Group in
exchange for control of the acquiree. Acquisition-related costs are generally recognised in profit or
loss as incurred.
At the acquisition date, the identifiable assets acquired and the liabilities assumed are recognised
at their fair value, except that:
• deferred tax assets or liabilities, and assets or liabilities related to employee benefit
arrangements are recognised and measured in accordance with IAS 12
Income Taxes
and
IAS 19
Employee Benefits
respectively;
• liabilities or equity instruments related to share-based payment arrangements of the acquiree
or share-based payment arrangements of the Group entered into to replace share-based
payment arrangements of the acquiree are measured in accordance with IFRS 2
Share-
based Payments
at the acquisition date (see the accounting policy below); and
• assets (or disposal groups) that are classified as held for sale in accordance with IFRS 5
Non-current Assets Held for Sale and Discontinued Operations
are measured in accordance
with that Standard.
Goodwill is measured as the excess of the sum of the consideration transferred, the amount of
any non-controlling interests in the acquiree, and the fair value of the acquirer’s previously held
equity interest in the acquiree (if any) over the net of the acquisition-date amounts of the identifiable
assets acquired and the liabilities assumed. If, after reassessment, the net of the acquisition-
date amounts of the identifiable assets acquired and liabilities assumed exceeds the sum of the
consideration transferred, the amount of any non-controlling interests in the acquiree and the fair
value of the acquirer’s previously held interest in the acquiree (if any), the excess is recognised
immediately in profit or loss as a bargain purchase gain.
