Maxis Berhad | Annual Report 2012

Maxis Berhad // Annual Report 2012 137 FINANCIAL STATEMENTS CORPORATE GOVERNANCE ANALYSIS OF SHAREHOLDINGS OTHER INFORMATION ANNUAL GENERAL MEETING 16 INTANGIBLE ASSETS (CONTINUED) Impairment testing for cash-generating units containing goodwill and telecommunications licenses with allocated spectrum rights For the purpose of impairment testing, carrying amounts of goodwill and telecommunications licenses with allocated spectrum rights are allocated to the Group’s cash-generating units (“CGU”) identified as mobile services. The recoverable amount of a CGU is determined based on value in use calculations. These calculations use pre-tax cash flow projections based on internally approved financial budgets covering five years (31.12.2011: five years; 1.1.2011: five years) period which reflect management’s expectations of revenue and EBITDA margin based on past experience and future expectations of business performance. The key assumptions used in the value in use calculations are as follows: (a) five years (31.12.2011: five years; 1.1.2011: five years) financial budget period; and (b) pre-tax discount rate of 14.0% (31.12.2011: 14.9%; 1.1.2011: 14.6%) derived in accordance with the requirements of MFRS 136 “Impairment of Assets” using the Group’s post-tax discount rate of 8.1% (31.12.2011: 8.3%; 1.1.2011: 8.5%). The key assumptions represent management’s assessment of future trends in the regional mobile telecommunications industry and are based on both external sources and internal sources. The discount rates used are pre-tax and reflect specific risks relating to the mobile services. The forecasts are most sensitive to changes in discount rates in the forecast period. Based on the sensitivity analysis performed, the Directors have concluded that any variation of 10% in the base case assumptions would not cause the carrying amount of the CGU to exceed its recoverable amount. 17 INTEREST IN SUBSIDIARIES Company Note 31.12.2012 31.12.2011 1.1.2011 RM’000 RM’000 RM’000 Non-current assets: - investments in subsidiaries 18 35,015,724 35,013,428 35,012,760 - loans to subsidiaries (a) 1,325,916 1,358,792 1,522,717 Current asset: - amount due from a subsidiary (b) 52 175 – Current liability: - amounts due to subsidiaries (b) (1,101) (1,155) (963) 36,340,591 36,371,240 36,534,514