notes to the financial statements
for the financial year ended 31 December 2014 (Continued)
13 GOODWILL
Group
2014
2013
RM'000
RM'000
Cost
At 1 January
114,633
109,886
Acquisition of subsidiaries
8,243
-
Effect of exchange rate changes
6,134
4,747
At 31 December
129,010
114,633
Carrying amount at 31 December
129,010
114,633
Impairment testing of goodwill
Goodwill arising from business combination has been allocated to the Group’s cash-generating-units (‘CGU’) identified according to operating divisions. The carrying
amounts of goodwill allocated to the respective CGUs are as follows:
Group
2014
2013
RM'000
RM'000
Cash-generating units
Specialised Pipe Coating and Corrosion Protection Services (CGU A)
69,677
58,496
EPC, Fabrication and Rental of Gas Compressors and Process Equipment (CGU B)
58,732
55,614
E&P Products and Services (CGU C)
601
523
129,010
114,633
The recoverable amount of the CGU is determined based on value-in-use calculations. These calculations use pre-tax cash flow projections based on financial budgets
approved by management covering a period of 5 years (2013: 5 years) based on past performance and their expectations of the market development.
117
Wah Seong Corporation Berhad • Annual Report 2014
