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Annual Report 2013
KPJ HEALTHCARE BERHAD
184
2.
Summary of signi cant accounting policies (continued)
2.9
Intangible assets (continued)
(b)
Other intangible assets
Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets acquired in
a business combination is their fair values as at the date of acquisition. Following initial recognition, intangible assets are
carried at cost less any accumulated amortisation and any accumulated impairment losses. The useful lives of intangible
assets are assessed to be either nite or inde nite. Intangible assets with nite lives are amortised on a straight-line basis
over the estimated economic useful lives and assessed for impairment whenever there is an indication that the intangible
asset may be impaired. The amortisation period and the amortisation method for an intangible asset with a nite useful life
are reviewed at least at each nancial year-end.
Software development expenditure
Software development is stated at cost less accumulated amortisation and impairment losses. The expenditure represents
development work carried out in developing specialised software packages and is capitalised if the product is technically
and commercially feasible and the Group has suf cient resources to complete the development. It is amortised over the
straight-line basis over a period of ve years. The policy for the recognition and measurement of impairment losses is in
accordance with Note 2.10. The expenditure capitalised includes cost to purchase the software and direct cost such as
salaries and hardware costs speci cally attributable to each project. Cost incurred in software development which have
ceased to be technically and commercially viable, are written off immediately.
2.10 Impairment of non- nancial assets
The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any such indication
exists, or when an annual impairment assessment for an asset is required, the Group makes an estimate of the asset’s recoverable
amount.
An asset’s recoverable amount is the higher of an asset’s fair value less costs to sell and its value in use. For the purpose of
assessing impairment, assets are grouped at the lowest levels for which there are separately identi able cash ows (cash-
generating units (“CGU”)).
In assessing value in use, the estimated future cash ows expected to be generated by the asset are discounted to their present
value using a pre-tax discount rate that re ects current market assessments of the time value of money and the risks speci c to
the asset. Where the carrying amount of an asset exceeds its recoverable amount, the asset is written down to its recoverable
amount. Impairment losses recognised in respect of a CGU or groups of CGUs are allocated rst to reduce the carrying amount of
any goodwill allocated to those units or groups of units and then, to reduce the carrying amount of the other assets in the unit or
groups of units on a pro-rata basis.
Impairment losses are recognised in pro t or loss except for assets that are previously revalued where the revaluation was taken
to other comprehensive income. In this case the impairment is also recognised in other comprehensive income up to the amount
of any previous revaluation.
Notes to the
Financial Statements
For the financial year ended 31 December 2013
(continued)