Maxis Berhad
Annual Report 2014
96
Notes to the
Financial Statements
31 December 2014
2 BASIS OF PREPARATION (CONTINUED)
(b) Standards and amendments to published standards that are applicable to the Group and the Company but not yet effective
(continued)
A number of new standards and amendments to published standards are effective for annual periods beginning after 1 January
2014. None of these is expected to have a significant effect on the consolidated and separate financial statements of the Group
and the Company respectively, except for those standards set out below: (continued)
For financial liabilities, the standard retains most of the MFRS 139 requirements. These include amortised cost accounting
for most financial liabilities, with bifurcation of embedded derivatives. The main change is that, in case where the fair value
option is taken for financial liabilities, the part of a fair value change due to an entity’s own credit risk is recorded in other
comprehensive income rather than the income statement, unless this creates an accounting mismatch.
There is now a new expected credit losses model on impairment for all financial assets that replaces the incurred loss
impairment model used in MFRS 139. The expected credit losses model is forward-looking and eliminates the need for a
trigger event to have occurred before credit losses are recognised. The Group and Company are currently assessing the
impact of MFRS 9.
3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The following accounting policies have been applied consistently in dealing with items that are considered material in relation to the
financial statements.
There is no presentation for segmental reporting following the Group’s refinement of its operations and management reporting
structure as disclosed in Note 5 to the financial statements.
(a) Basis of consolidation
(i) Subsidiaries
Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an entity
when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to
affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is
transferred to the Group. They are deconsolidated from the date that control ceases.
The Group applies the acquisition method to account for business combinations. The consideration transferred for the
acquisition of a subsidiary is the fair values of the assets transferred, the liabilities incurred to the former owners of the
acquiree and the equity interests issued by the Group. The consideration transferred includes the fair value of any asset
or liability resulting from a contingent consideration arrangement. Identifiable assets acquired and liabilities and contingent
liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. The Group
recognises any non-controlling interest in the acquiree on an acquisition-by-acquisition basis, either at fair value or at the
non-controlling interest’s proportionate share of the recognised amounts of acquiree’s identifiable net assets.
Acquisition-related costs are expensed as incurred.
