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148 KUMPULAN WANG PERSARAAN (DIPERBADANKAN) FoR BEttER REtURNS

notes to the
financial statements
for the year ended 31 december 2022

2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
2.3 Subsidiaries And Basis Of Consolidation (continued)

(b) Basis of consolidation

the consolidated financial statements comprise of the financial statements of KWap and its subsidiaries.
the individual financial statements of KWap and its subsidiaries used in the preparation of the consolidated
financial statements are prepared for the same reporting date. consistent accounting policies are applied for
like transactions and events in similar circumstances.

in the event where KWap has less than the majority of the voting rights in an entity, consideration of the
following is required in the assessment on the sufficiency of the voting rights in relation to KWap’s power
over the entity:
• The size of KWAP’s holding of voting rights relative to the size and dispersion of the holdings of other
vote holders;
• Potential voting rights held by KWAP, other vote holders or other parties;
• Rights arising from other contractual arrangements; and
• Any additional facts or circumstances which indicate KWAP’s current ability to direct the relevant
activities at the time of the decision making including the voting patterns at previous shareholders’
meetings.

intra group transactions, balances and unrealised gains on transactions between KWap and its subsidiaries
are eliminated. unrealised losses are also eliminated unless the transaction provides evidence of impairment
of the transferred asset. the consolidated financial statements reflect only the external transactions of the
group.

losses within subsidiaries are attributed to the non-controlling interests even if the attribution results in a
deficit balance.

(c) Business combinations

acquisitions of subsidiaries are accounted for using the acquisition method. the cost of an acquisition is the
aggregate of the consideration transferred, measured at fair value on the acquisition date and the amount
of non-controlling interest in an entity, if any. the group elects on a transaction-by-transaction basis,
whether to measure the non-controlling interests in the acquiree either at fair value or at the proportionate
share of the acquiree’s identifiable net assets. transaction costs incurred are recognised as administrative
expenses.

any contingent consideration to be transferred by the acquirer shall be recognised at fair value at the
acquisition date. subsequent changes in the fair value of the contingent consideration deemed to be an
asset or liability, shall be recognised in the statement of comprehensive income, in accordance with the
mfrs 9, in profit or loss. remeasurement is not required in the event the contingent consideration is
classified as equity whereby subsequent settlement, if any, is accounted for within equity.
in instances where the contingent consideration is beyond the scope of the mfrs 9, it is measured in
accordance with the appropriate mfrs.