notes to the financial statements - Investor Relations

NOTES TO THE FINANCIAL STATEMENTS
YEAR ENDED 31 DECEMBER 2011
3 SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.1 Basis of consolidation (cont’d)
Business combinations (cont’d)
Annual Report 2011
When share-based payment awards (replacement awards) are exchanged for awards held by the acquiree’s employees
(acquiree’s awards) and relate to past services, then all or a portion of the amount of the acquirer’s replacement awards is
included in measuring the consideration transferred in the business combination. This determination is based on the marketbased
value of the replacement awards compared with the market-based value of the acquiree’s awards and the extent to
which the replacement awards relate to past and/or future service.
Subsidiaries
Subsidiaries are entities controlled by the Group. The financial statements of subsidiaries are included in the consolidated
financial statements from the date that control commences until the date that control ceases.
The accounting policies of subsidiaries have been changed when necessary to align them with the policies adopted by the
Group. Losses applicable to the non-controlling interests in a subsidiary are allocated to the non-controlling interests even if
doing so causes the non-controlling interests to have a deficit balance.
Loss of control
Upon the loss of control, the Group derecognises the assets and liabilities of the subsidiary, any non-controlling interests and
the other components of equity related to the subsidiary. Any surplus or deficit arising on the loss of control is recognised in
profit or loss. If the Group retains any interest in the previous subsidiary, then such interest is measured at fair value at the
date that control is lost. Subsequently, it is accounted for as an equity-accounted investee or as an available-for-sale financial
asset depending on the level of influence retained.
Investments in associates and jointly-controlled entities (equity-accounted investees)
Associates are those entities in which the Group has significant influence, but not control, over the financial and operating
policies of these entities. Significant influence is presumed to exist when the Group holds between 20% and 50% of the
voting power of another entity. Jointly-controlled entities are those entities over whose activities the Group has joint control,
established by contractual agreement and requiring unanimous consent for strategic financial and operating decisions.
Investments in associates and jointly-controlled entities are accounted for using the equity method (equity-accounted
investees) and are recognised initially at cost.
The consolidated financial statements include the Group’s share of the profit or loss and other comprehensive income of the
equity-accounted investees, after adjustments to align the accounting policies of the equity-accounted investees with those
of the Group, from the date that significant influence or joint control commences until the date that significant influence or joint
control ceases.
When the Group’s share of losses exceeds its interest in an equity-accounted investee, the carrying amount of that interest,
including any long-term investments, is reduced to zero, and the recognition of further losses is discontinued except to the
extent that the Group has an obligation or has made payments on behalf of the investee.
Acquisition of non-controlling interests
Acquisitions of non-controlling interests are accounted for as transactions with owners in their capacity as owners and
therefore the carrying amount of assets and liabilities are not changed and therefore no goodwill is recognised as a result of
such transactions. The adjustments to non-controlling interests are based on a proportionate amount of the net assets of
the subsidiary. Any difference between the adjustment to non-controlling interests and the fair value of consideration paid is
recognised directly in equity and presented as part of equity attributable to owners of the Company.
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