Integrated Reports Senwes Financial Review 2018 - Page 62

62 FINANCIAL REVIEW Goodwill is initially measured at cost, being the excess of the aggregate of the conside-­ ration transferred and the amount recognised for non-controlling interests, and any pre-­ vious interest held, over the net identifiable assets acquired and liabilities assumed. If the fair value of the net assets acquired is in excess of the aggregate consideration transferred, the group reassesses whether it has correctly identified all of the assets acquired and all of the liabilities assumed and reviews the procedures used to measure the amounts to be recognised at the acquisition date. If the reassessment still results in an excess of the fair value of net assets acquired over the aggregate consideration transferred, then the gain is recognised in profit or loss. After initial recognition, goodwill is measured at cost less any accumulated impairment losses. For the purpose of impairment testing, goodwill acquired in a business combina- tion is, from the acquisition date, allocated to each of the group’s cash-generating units that are expected to benefit from the combination, irrespective of whether other assets or liabilities of the acquiree are assigned to those units. The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest. Where goodwill has been allocated to a cash-generating unit and part of the operation within that unit is disposed of, the goodwill associated with the disposed operation is included in the carrying amount of the operation when determining the gain or loss on disposal. Goodwill disposed in these circumstances is measured based on the relative values of the disposed operation and the portion of the cash-generating unit retained. A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant who would use the asset in its highest and best use. Transactions under common control A business combination involving entities or businesses under common control is a busi- ness combination in which all of the combining entities or businesses are ultimately con- trolled by the same party or parties both before and after the business combination and that control is not transitory. The group uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs. All assets and liabilities for which fair value is measured or disclosed in the financial state- ments are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole: Where a business is obtained through common control, the assets and liabilities will be reflected at their carrying amount on acquisition date. No ‘new’ goodwill is recognised as a result of the common control transaction, except for existing goodwill relating to either of the combining entities. Any difference between the consideration paid/trans- ferred and the equity ‘acquired’ is reflected within equity. 2.1.4 FAIR VALUE MEASUREMENTS FINANCIAL REVIEW The group measures financial instruments, such as derivatives and certain inventory, such as grain commodity at fair value at each statement of financial position date. Also, fair values of financial instruments measured at amortised cost are disclosed in note 4.1.2, 4.2.1 and 4.2.2. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either: In the principal market for the asset or liability, or In the absence of a principal market, in the most advantageous market for the asset ܈XX[]KH[\[܈H[Y[Y[\X\]]\HX\XHBBBHܛ\ BHH][ H8$][Y [Y\Y HX\]X\[X]HX\]܈Y[X[\]܂BBHXX[]Y\˂BBBBBBBHH][ 8$[X][ۈX\]Y\܈XH\][[]]\YۚYX[BBBBHZ\[YHYX\\[Y[\\XH܈[\XH؜\XKBBHH][ 8$[X][ۈX\]Y\܈XH\][[]]\YۚYX[BBBBHZ\[YHYX\\[Y[\[؜\XKBBBBBBBBBBBB܈\][XX[]Y\]\HXۚ\Y[H[[X[][Y[ۈHX\[\\Hܛ\]\Z[\]\[ٙ\]H\Y]Y[][[HY\\BHX\\[]Yܚ\][ۈ \YۈH\][[]]\YۚYX[BZ\[YHYX\\[Y[\HJH]H[وXX\ܝ[\[