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4. INTANGIBlE ASSETS (Cont’d)
Impairment testing for cash-generating units containing goodwill
Masterskill Education Group Berhad / Annual Report 2012
81
NOTES TO THE FINANCIAL STATEMENTS (CONT’D)
For the purpose of impairment testing, goodwill is allocated to the Group’s operating division which represents the lowest level
within the Group at which the goodwill is monitored for internal management purposes.
The recoverable amount of the operating division was based on its value in use calculation. The estimated value in use was
determined using pre-tax discount rate of 12.5% based on the following key assumptions:
(i) Cash flows were projected based on past experience, actual operating results and prospective financial information.
(ii) The values assigned to the key assumptions represent management’s assessment of trends in the education industry and are
based on both external sources and internal sources (historical data).
The estimated recoverable amount exceeds the carrying amount of goodwill. Management considers that no impairment should
be recognised.
5. INvESTmENTS IN SuBSIDIARIES
Note 31.12.2012
Company
31.12.2011 1.1.2011
Rm’000 Rm’000 Rm’000
At cost:
Unquoted shares 91,381 83,831 83,800
Amounts due from subsidiaries 5.1 42,845 42,845 42,845
134,226 126,676 126,645
5.1 The amounts due from subsidiaries were non-trade in nature, unsecured and interest free. The settlement of the amounts
was neither planned nor likely to occur in the foreseeable future. As these amounts were in substance, a part of the
Company’s net investment in the subsidiaries, they were stated at cost less accumulated impairment losses.