You are on page 1of 4

ACCOUNTING POLICIES FOR MAJOR ASSETS

The financial statements of the Group and the Company have been
prepared in accordance with the Malaysian Financial Reporting Standards
(MFRS), International Financial Reporting Standards and the requirements
of the Companies Act, 1965 in Malaysia. The financial statements have
been prepared under the historical cost convention, as modified by the
revaluation of available-for-sale financial assets, and financial assets and
financial liabilities at fair value through profit or loss. The financial
statements are presented in Ringgit Malaysia (RM) and all values are
rounded to the nearest thousand (RM000) except when otherwise
indicated.
The financial statements of Media Prima Berhad have been prepared
by using applicable MFRS for certain items in the financial statements. For
preparation of financial statements as a whole, Media Prima Berhad
applies MFRS 101 Presentation of Financial Statements. While for its noncurrent assets such as property, plant and equipment, MFRS 116 Property,
Plant and Equipment had been used. MFRS 138 Intangible Assets is used
for disclosure of Media Prima Berhads intangible assets.
Based on statement of financial position as at 31 December 2015,
one of Media Prima Berhad major assets is subsidiaries which are all those
entities over which the Group has control. The Group applies the
acquisition

method

to

account

for

business

combinations.

The

consideration transferred for acquisition of a subsidiary is the fair values


of the assets transferred, the liabilities incurred to the former owners of
the acquiree and the equity interests issued by the Group.
Identifiable assets acquired and liabilities and contingent liabilities
assumed in a business combination are measured initially at their fair
values at the acquisition date. The excess of the consideration transferred
for acquisition, the amount of any non-controlling interest in the acquiree
and the acquisition-date fair value of any previous equity interest in
acquiree over the fair value of the Groups share of the identifiable net

assets acquired is recorded as goodwill. If this is less than the fair value of
the net assets of the subsidiary acquired in the case of a bargain
purchase, the difference is recognised in profit or loss.
Non-controlling interest is the equity in a subsidiary not attributable,
directly or indirectly, to a parent. On an acquisition-by-acquisition basis,
the Group measures any non-controlling interest in the acquiree either at
fair value or at the non-controlling interests proportionate share of the
recognised amounts of acquirees identifiable net assets. At the end of
reporting period, non-controlling interest consists of amount calculated on
the date of combinations and its share of changes in the subsidiarys
equity since the date of combination. If the business combination is
achieved in stages, the acquisition date fair value of the acquirers
previously held equity interest in the acquiree is remeasured to fair value
at the acquisition date, any gains or losses arising from such remeasurement are recognised in profit or loss.
The Group applies predecessor accounting to account for business
combinations under common control. Under the predecessor accounting
assets and liabilities acquired are not restated to their respective fair
values but at the carrying amounts from the consolidated financial
statements of the ultimate holding company of the Group and adjusted to
ensure uniform accounting policies of the Group. The difference between
any consideration given and the aggregate carrying amounts of the assets
and liabilities of the acquired entity is recorded as an adjustment to
retained earnings. The acquired entitys results, assets and liabilities are
consolidated from the date on which the business combination between
entities under common control occurred.
Accounting policies of subsidiaries have been changed where
necessary to ensure consistency with the policies adopted by the Group.
When the Group ceases to consolidate because of a loss of control, any
retained interest in the entity is remeasured to its fair value with the
change in carrying amount recognised in profit or loss. This fair value
becomes the initial carrying amount for the purposes of subsequently

accounting for the retained interest as an associate, joint venture or


financial asset. This may mean that amounts previously recognised in
other comprehensive income are reclassified to profit or loss as if the
Group had directly disposed of the related assets or liabilities.Gains or
losses on the disposal of subsidiaries include the carrying amount of
goodwill relating to the subsidiaries sold.
Nest, investments in subsidiaries and associates are the second
major assets for the Media Prima Berhad. In the Companys separate
financial statements, investments in subsidiaries and associates are
stated at cost less accumulated impairment losses. Where an indication of
impairment exists, the carrying amount of the investment is assessed and
written down immediately to its recoverable amount. On disposal of an
investment, the difference between the net disposal proceeds and its
carrying amount is charged or credited to the profit or loss. The amounts
due from subsidiaries of which the Company does not expect repayment
in the foreseeable future are considered as part of the Companys
investment in subsidiaries.
Then, property, plant and equipment are also one of the major
assets for Media Prima Berhad. Property, plant and equipment are stated
at cost less accumulated depreciation and impairment losses. The cost of
an item of property, plant and equipment initially recognised includes its
purchase price and any cost that is directly attributable to bringing the
asset to the location and condition necessary for it to be capable of
operating in the manner intended by management. Cost also includes
borrowing

costs

that

are

directly

attributable

to

the

acquisition,

construction or production of a qualifying asset. Subsequent costs are


included in the assets carrying amount or recognised as a separate asset,
as appropriate, only when it is probable that future economic benefits
associated with the item will flow to the Group and the cost of the item
can be measured reliably.
Freehold land is not depreciated as it has an infinite life.
Depreciation on assets under construction commences when the assets

are ready for their intended use. Depreciation on the other property, plant
and equipment is calculated so as to write off the cost or valuation of the
assets to their residual values on a straight line basis over the expected
useful lives of the assets. Leasehold land is amortised over the remaining
period of the respective leases ranging from 40 and 96 years. At each
financial position date, the Group assesses whether there is any indication
of impairment. If such indications exist, an analysis is performed to assess
whether the carrying amount of the asset is fully recoverable. A write
down is made if the carrying amount exceeds the recoverable amount.
Gains and losses on disposals are determined by comparing proceeds with
carrying amounts and are included in the profit or loss.