(coco) #1

2019 Annual Report (^99)
Amortisation is charged to profit or loss on a
straight-line basis over the period of the rights
which is generally no more than 50 years.
(i) Goodwill and intangible assets
(i) Goodwill
Goodwill represents the excess of the fair
value of consideration paid to acquire a
subsidiary over the acquisition date fair value
of the acquiree’s identifiable assets acquired
less liabilities, including contingent liabilities,
assumed as at the acquisition date, less
impairment losses (see note 3(k)).
Where the fair value of the assets acquired less
liabilities assumed exceeds the consideration
paid, the excess is recognised immediately in
profit or loss as a gain.
(ii) Other intangible assets
Other intangible assets are stated at cost less
accumulated amortisation and impairment
losses (see note 3(k)).
(iii) Amortisation
Goodwill is not amortised but subject to
impairment testing (see note 3(k)) annually.
The cost of other intangible assets with finite
useful lives is amortised to profit or loss on a
straight-line basis over the assets’ estimated
useful lives from the date they are available for
use. Their estimated useful lives are as follows:
■ Software 2 to 10 years
■ Royalties 2 to 10 years
■ Patents 2 to 10 years
■ Trademark and others 2 to 20 years
Both the period and method of amortisation
are reviewed annually and revised when
(iv) Research and development
Research and development costs are all
costs directly attributable to research and
development activities together with cost
which can be allocated on a reasonable basis
to such activities. The nature of the Group’s
research and development activities is such
that the criteria for the recognition of such
costs as assets are generally not met until
late in the development stage of the project
when the remaining development costs are
immaterial. Therefore, expenditure on research
and development activities is generally
recognised as an expense in the period in
which it is incurred.
(j) Leases
The Group has adopted IFRS 16 from January
1, 2019. As permitted by the standard,
comparative figures have not been restated
and these are presented in accordance with the
Group’s previous policies. Both the new and
the previous accounting policies are described
Policy applied from January 1, 2019
A contract is, or contains, a lease if the
contract conveys the right to control the use
of an identified asset for a period of time,
the lease term, in exchange for consideration.
The Group assesses whether a contract is, or
contains, a lease on inception.
The lease term is either the non-cancellable
period of the lease and any additional periods
when there is an enforceable option to extend
the lease and it is reasonably certain that the
Group will extend the term, or a lease period
in which it is reasonably certain that the Group
will not exercise a right to terminate. The
lease term is reassessed if there is a significant
change in circumstances.
(i) As a lessee
At commencement, or on the modification, of
a contract that contains a lease component,
the Group allocates the consideration in the
contract to each lease component on the basis
of its relative stand-alone prices.
The Group recognises a right-of-use asset and a
lease liability at the lease commencement date.
The right-of-use asset is initially measured at
cost, which comprises the initial amount of the
lease liability adjusted for any lease payments
made at or before the commencement date,
plus any initial direct costs incurred and an
estimate of costs to dismantle and remove the
underlying asset or to restore the underlying
asset or the site on which it is located, less any
lease incentives received.

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