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Asia Media Group Berhad
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Annual Report 2015
Notes to the Financial Statements
(continued)
pg.
91
4. Significant accounting judgements, estimates and assumptions
(cont’d)
(c) Impairment of other intangible assets
The Group assess impairment of assets whenever the events or changes in circumstances
indicate that the carrying amount of an asset may be recoverable i.e. the carrying amount
of the asset is more than recoverable amount.
Recoverable amount is measured at the higher of the fair value less cost of disposal for that
asset and its value-in-use. The value-in-use is the net present value of the projected future
cash flows derived from that asset discounted at an appropriate discount rate. Projected
future cash flows are based in the Group’s estimates calculated based on historical, sector
and industry trends, general market and economic conditions changes in technology and
other available information.
As a result of the impairment assessment made by the Directors, an impairment loss of
RM887,639 (2014: RM Nil) has been provided as disclosed in the Note 6 and 17 to the
financial statements.
(d) Impairment of goodwill on consolidation
The Group determines whether goodwill is impaired at least on an annual basis. This
requires an estimation of the value-in-use of CGU to which the goodwill is allocated.
Estimating a value-in-use amount requires management to make an estimation of the
expected future cash flows from the CGU and also to choose a suitable discount rate in
order to calculate the present value of those cash flows.
Further details of the key assumptions applied in the impairment assessment of goodwill
are disclosed in Note 9 to the financial statements. The carrying amount of goodwill as at
31 December 2015 was RM Nil (2014: RM2,570,627) as disclosed in Note 9 to the financial
statements.
(e) Impairment of investment in subsidiaries and recoverability of amount owing by
subsidiaries
The Group tests investment in subsidiaries for impairment annually in accordance with
its accounting policy. More regular reviews are performed in events indicate that this is
necessary. The assessment of the net tangible assets of the subsidiaries affects the result
of the impairment test. Cost of investments in subsidiaries which have ceased operations
were impaired up to net assets of the subsidiaries. The impairment made on investment
in subsidiaries entails an impairment of receivables to be made to amount owing by these
subsidiaries.