APM AUTOMOTIVE HOLDINGS BERHAD
58
NOTES TO THE
FINANCIAL STATEMENTS
2.
Significant accounting policies (continued)
(f)
Intangible assets (continued)
(i)
Research and development expenditure (continued)
Expenditure on development activities, whereby the application of research findings are applied to
a plan or design for the production of new or substantially improved products and processes, is
capitalised only if development costs can be measured reliably, the product or process is technically
and commercially feasible, future economic benefits are probable and the Group intends to and has
sufficient resources to complete development and to use or sell the asset.
The expenditure capitalised includes the cost of materials, direct labour and an appropriate proportion
of overheads. Other development expenditure is recognised in profit or loss as incurred.
Capitalised development expenditure is stated at cost less accumulated amortisation and any
accumulated impairment losses.
(ii) Goodwill
Goodwill arises on business combinations is measured at cost less any accumulated impairment
losses.
(iii) Other intangible assets
Intangible assets, other than goodwill that are acquired by the Group, which have finite useful lives,
are measured at cost less any accumulated amortisation and any accumulated impairment losses.
(iv) Subsequent expenditure
Subsequent expenditure is capitalised only when it increases the future economic benefits embodied
in the specific asset to which it relates. All other expenditure including expenditure on internally
generated goodwill and brands is recognised in profit or loss as incurred.
(v) Amortisation
Goodwill and intangible assets with indefinite useful lives are not amortised but are tested for
impairment annually and whenever there is an indication that they may be impaired.
Other intangible assets are amortised from the date that they are available for use. Amortisation is
based on the cost of an asset less its residual value. Amortisation is recognised in profit or loss on
a straight-line basis over the estimated useful lives of intangible assets from the date that they are
available for use.
The estimated useful lives for the current and comparative periods are as follows:
l
development expenditures
3 - 5 years
l
trademarks
2 years
l
design
3 years
Amortisation methods, useful lives and residual values are reviewed at the end of each reporting
period are adjusted, if appropriate.
