71
71
2015/2016 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
for the financial year ended 31 March 2016
2. BASIS OF PREPARATION (CONTINUED)
(e) Changes and adoptation of new/revised financial reporting standards (continued)
The adoption of these new or amended FRSs did not result in substantial changes to the accounting
policies of the Group and the Company and had no material effect on the amounts reported for the
current or prior financial years.
3. SIGNIFICANT ACCOUNTING POLICIES
The accounting policies set out below have been applied consistently to all periods presented in these
financial statements and have been applied consistently by the Group entities, except as explained in
notes 2(e) and 3(z), which address changes in accounting policies.
(a) Basis of consolidation
Business combinations
Business combinations are accounted for using the acquisition method in accordance with FRS
103
Business Combinations
as at the acquisition date, which is the date on which control is transferred to
the Group.
The Group measures goodwill at the acquisition date as:
• the fair value of the consideration transferred; plus
• the recognised amount of any non-controlling interests in the acquiree; plus
• if the business combination is achieved in stages, the fair value of the pre-existing equity interest
in the acquiree,
over the net recognised amount (generally fair value) of the identifiable assets acquired and liabilities
assumed. Any goodwill that arises is tested annually for impairment.
When the excess is negative, a bargain purchase gain is recognised immediately in profit or loss.
The consideration transferred does not include amounts related to the settlement of pre-existing
relationships. Such amounts are generally recognised in profit or loss.
Any contingent consideration payable is recognised at fair value at the acquisition date and included
in the consideration transferred. If the contingent consideration that meets the definition of a financial
instrument is classified as equity, it is not re-measured and settlement is accounted for within equity.
Otherwise, subsequent changes to the fair value of the contingent consideration are recognised in
profit or loss.
Costs related to the acquisition, other than those associated with the issue of debt or equity securities,
that the Group incurs in connection with a business combination are expensed as incurred.
