70
CORDLIFE GROUP LIMITED
| ANNUAL REPORT 2015
NOTES TO THE FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2015
2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED)
2.4 Basis of consolidation and business combinations
(Continued)
(b)
Basis of consolidation
(Continued)
Basis of consolidation prior to 1 July 2010
Certain of the above-mentioned requirements were applied on a prospective basis. The
following differences, however, are carried forward in certain instances from the previous basis
of consolidation:
– Acquisition of non-controlling interests, prior to 1 July 2010, were accounted for using
the parent entity extension method, whereby, the difference between the consideration
and the book value of the share of the net assets acquired were recognised in goodwill.
– Losses incurred by the Group were attributed to the non-controlling interest until the
balance was reduced to nil. Any further losses were attributed to the Group, unless the
non-controlling interest had a binding obligation to cover these. Losses prior to 1 July
2010 were not reallocated between non-controlling interests and the owners of the
Company.
(c)
Business combinations from 1 July 2010
Acquisitions of subsidiaries, other than those under common control, 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.
When the Group acquires a business, it assesses the financial assets and liabilities assumed for
appropriate classification and designation in accordance with the contractual terms, economic
circumstances and pertinent conditions as at the acquisition date. This includes the separation
of embedded derivatives in host contracts by the acquiree.
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 accordance with FRS 39 either
in profit or loss or as a change to other comprehensive income. If the contingent consideration
is classified as equity, it is not remeasured until it is finally settled within equity.
In business combinations achieved in stages, previously held equity interests in the acquiree are
remeasured to fair value at the acquisition date and any corresponding gain or loss is recognised
in profit or loss.
