Powering growth - Aztech Group Ltd - Investor Relations

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 9512 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)At the date of authorisation of these financial statements, the following FRSs, INT FRSs and amendments to FRSs that are relevant to the Groupand the Company were issued but not effective:FRS 27 (Revised) - Consolidated and separate Financial StatementsFRS 103 (Revised) - Business CombinationsFRS 107 - Financial Instruments: Disclosure regarding reclassification of financial assetsAmendment to FRS 7 - Statement of Cash FlowAmendments to FRS 38 - Intangible AssetsAmendments to FRS 39 - Financial Instruments: Recognition and measurementConsequential amendments were also made to various standards as a result of these new/revised standards.Management anticipates that the adoption of the above FRSs, INT FRSs and amendments to FRSs in future periods will not have a material impacton the financial statements of the Group and of the Company in the period of their initial adoption.BASIS OF CONSOLIDATION - The consolidated financial statements incorporate the financial statements of the Company and entities (includingspecial purpose entities) controlled by the Company (its subsidiaries). Control is achieved when the Company has the power to govern the financialand operating policies of an entity so as to obtain benefits from its activities.The results of subsidiaries acquired or disposed of during the year are included in the consolidated statement of comprehensive income from theeffective date of acquisition or up to the effective date of disposal, as appropriate.Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies into line with those used by othermembers of the Group.All intra-group transactions, balances, income and expenses are eliminated on consolidation.Minority interests in the net assets of the consolidated subsidiaries are identified separately from the Group’s equity therein. Minority interests consistof the amount of those interests at the date of the original business combination (see below) and the minority’s share of changes in equity since thedate of the combination. Losses applicable to the minority in excess of the minority’s interest in the subsidiary’s equity are allocated against theinterests of the Group except to the extent that the minority has a binding obligation and is able to make an additional investment to cover its shareof those losses.In the Company’s financial statements, investments in subsidiaries are carried at cost less any impairment in net recoverable value that has beenrecognised in profit or loss.BUSINESS COMBINATIONS - The acquisition of subsidiaries is accounted for using the purchase method. The cost of the acquisition ismeasured at the aggregate of the fair values, at the date of exchange, of assets given, liabilities incurred or assumed, and equity instrumentsissued by the Group in exchange for control of the acquiree, plus any costs directly attributable to the business combination. The acquiree’sidentifiable assets, liabilities and contingent liabilities that meet the conditions for recognition under FRS 103 are recognised at their fair valuesat the acquisition date, except for non-current assets (or disposal groups) that are classified as held for sale in accordance with FRS 105 Non-Current Assets Held for Sale and Discontinued Operations, which are recognised and measured at fair value less costs to sell.Goodwill arising on acquisition is recognised as an asset and initially measured at cost, being the excess of the cost of the business combinationover the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised. If, after reassessment,the Group’s interest in the net fair value of the acquiree’s identifiable assets, liabilities and contingent liabilities exceeds the cost of the businesscombination, the excess is recognised immediately in profit or loss.The interest of minority shareholders in the acquiree is initially measured at the minority’s proportion of the net fair value of the assets, liabilitiesand contingent liabilities recognised.