Page 151 - KWAP_AR2022

FoR BetteR RetuRns Annual Report 2022 149

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)

(c) Business combinations (continued)

upon the acquisition of a business by the group, assessment on the financial assets and liabilities is
required for the appropriate designation and classification in accordance with the contractual terms,
economic circumstances and pertinent conditions as at the acquisition date. inclusive is the separation of
embedded derivatives in host contracts by the acquiree.

in the event the business combination is achieved in stages, the acquisition date fair value of the acquirer’s
previously held equity interest in the acquiree is remeasured to the fair value at the subsequent acquisition
date through profit or loss.
the excess of the aggregate of consideration transferred, the amount recognised for the non-controlling
interests and the acquisition date fair value of any previously held equity interest in the acquiree over the
net identifiable assets acquired and liabilities assumed, is initially recognised as goodwill. in the event the
said consideration is lower than the fair value of the net assets of the acquired subsidiary, the difference is
recognised in profit or loss.

(d) Investments in subsidiaries in separate Financial Statements
in KWap’s separate financial statements, investments in subsidiaries are carried at cost less accumulated
impairment losses. upon the disposal of investment in subsidiaries, the difference between the disposal
proceeds and the carrying amount of the investments is recognised in profit or loss.

the amount due from subsidiaries of which KWap does not expect repayment in the foreseeable future is
considered as part of KWap’s investments in the subsidiaries.

2.4 Investments In Associates And Joint Ventures

associates are entities in which the group has significant influence but not control or joint control,
generally accompanying a shareholding of between 20% and 50% of the voting rights. significant influence is
the power to participate in the financial and operating policy decisions of the entity but not the control or joint
control over those policies.

the existence and effect of potential voting rights that are currently exercisable or convertible are considered in
the assessment of the group’s significant influence over another entity.

on the acquisition of an investment in associates or joint ventures, the excess of the cost of investment over the
group’s share of the net fair value of identifiable assets and liabilities of the entity is recognised as goodwill and
subsequently included in the carrying amount of the investment. the excess of the group’s share of the net fair
value of identifiable assets and liabilities of the entity over the cost of investment is excluded from the carrying
amount of the investment and is instead included as income in the determination of the group’s share of the
associate’s or joint venture’s profit or loss for the period in which the investment is acquired.

associates or joint ventures are accounted for using the equity method from the date the entity is recognised as
an associate or a joint venture.