2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
2.4
Basis of consolidation and business combinations (continued)
(a)
Basis of consolidation (continued)
Subsidiaries are consolidated from the date of acquisition, being the date on which the Group
obtains control, and continue to be consolidated until the date that such control ceases.
Losses within a subsidiary are attributed to the non-controlling interest even if that results
in a deficit balance.
A change in the ownership interest of a subsidiary, without a loss of control, is accounted
for as an equity transaction. If the Group loses control over a subsidiary, it:
–
De-recognises the assets (including goodwill) and liabilities of the subsidiary at their
carrying amounts at the date when control is lost;
–
De-recognises the carrying amount of any non-controlling interest;
–
De-recognises the cumulative translation differences recorded in equity;
–
Recognises the fair value of the consideration received;
–
Recognises the fair value of any investment retained;
–
Recognises any surplus or deficit in profit or loss;
–
Re-classifies the Group’s share of components previously recognised in other
comprehensive income to profit or loss or retained earnings, as appropriate.
(b)
Business combinations
Business combinations are accounted for by applying the acquisition method. Identifiable
assets acquired and liabilities assumed in a business combination are measured initially at
their fair values at the acquisition date. Acquisition-related costs are recognised as expenses
in the periods in which the costs are incurred and the services are received.
Any contingent consideration to be transferred by the acquirer will be recognised at fair value
at the acquisition date. Subsequent changes to the fair value of the contingent consideration
which is deemed to be an asset or liability, will be recognised in profit or loss.
56
NOTES TO THE
FINANCIAL STATEMENTS
For the financial year ended 31 December 2015
HG METAL MANUFACTURING LIMITED
ANNUAL REPORT 2015
