Maxis Berhad | Annual Report 2012

Maxis Berhad // Annual Report 2012 110 3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (d) Intangible assets (continued) (ii) Goodwill (continued) Goodwill is allocated to cash-generating units for the purpose of impairment testing and is tested annually for impairment or more frequently if events or changes in circumstances indicate that it might be impaired. See accounting policy Note 3(g)(i) on impairment of non-financial assets. Each cash-generating unit or a group of cash-generating units represents the lowest level within the Group at which goodwill is monitored for internal management purposes and which are expected to benefit from the synergies of the combination. (iii) Customer acquisition costs Expenditures incurred in providing the customer a free or subsidised device including installation costs, provided the customer signs a non-cancellable contract for a predetermined contractual period, are capitalised as intangible assets and amortised over the contractual period on a straight line method. Customer acquisition costs are assessed at each reporting date whether there is any indication that the customer acquisition costs may be impaired. See accounting policy Note 3(g)(i) on impairment of non-financial assets. (e) Investments in subsidiaries Investments in subsidiaries are stated at cost plus the fair value of share options granted to employees of the subsidiaries over the vesting period deemed as capital contribution. See accounting policy Note 3(t)(iii) on share-based compensation. Where an indication of impairment exists, the carrying amount of the investment is assessed and written down immediately to its recoverable amount. See accounting policy Note 3(g)(i) on impairment of non-financial assets. (f) Financial instruments A financial instrument is any contract that gives rise to both a financial asset of one enterprise and a financial liability or equity instrument of another enterprise. A financial asset is any asset that is cash, a contractual right to receive cash or another financial asset from another enterprise, a contractual right to exchange financial instruments with another enterprise under conditions that are potentially favourable, or an equity instrument of another enterprise. A financial liability is any liability that is a contractual obligation to deliver cash or another financial asset to another enterprise, or to exchange financial instruments with another enterprise under conditions that are potentially unfavourable. (i) Classification and measurement Financial assets The Group and the Company classify their financial assets in the following categories: at fair value through profit or loss, held-to-maturity, loans and receivables, and available-for-sale. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of financial assets at initial recognition. The Group and the Company do not hold any financial assets carried at fair value through profit or loss (except for derivatives that are designated as effective hedging instruments) and held-to-maturity. See accounting policy Note 3(h) on derivative financial instruments and hedging activities. Financial assets are classified as current assets; except for maturities greater than 12 months after the reporting date, in which case they are classified as non-current assets. NOTES TO THE FINANCIAL STATEMENTS 31 DECEMBER 2012 Continued