ENRA Group Berhad | Annual Report 2022 122 NOTES TO THE FINANCIAL STATEMENTS 31 MARCH 2022 8. GOODWILL ON CONSOLIDATION Group 2022 2021 Note RM’000 RM’000 At beginning of the financial year 4,404 12,940 Disposal of subsidiary (4,004) – Impairment during the year – (8,536) At end of the financial year 7 400 4,404 (a) Goodwill is initially measured at cost, being the excess of the aggregate of the consideration transferred and the amount recognised for non-controlling interests, and any previous interest held, over the net identifiable assets acquired and liabilities assumed. After initial recognition, goodwill is measured at cost less accumulated impairment losses. Goodwill is not amortised, but instead, it is reviewed for impairment at least annually and whenever events or changes in circumstances indicate that the carrying value may be impaired. This requires an estimation of the value-in-use of the subsidiaries to which goodwill is allocated. Estimating a value-in-use amount requires management to make an estimate of the expected future cash flows from the subsidiaries and also to choose a suitable discount rate in order to calculate the present value of those cash flows. (b) Impairment of goodwill Goodwill has been allocated to the identified cash generating unit (“CGU”) according to relevant operating segments based on the geographical location of customers as follows: Group 2022 2021 RM’000 RM’000 Malaysia 400 400 Australia – 4,004 400 4,404
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