Econocom - 2020 annual report

06 consolidated financial statements

notes to the consolidated financial statements

Measuring non-controlling (minority) interests

The Group may choose whether to measure non-controlling interests at fair value or at the non-controlling interest’s proportionate share of the acquiree’s net identifiable assets. Acquisition-related expenses are expensed as incurred. Measuring business combinations (or goodwill) The difference between the consideration transferred and the acquirer’s share in the fair value of the identifiable assets and liabilities and contingent liabilities at the acquisition date is recognised in goodwill on a separate line in the financial statements. These items may be adjusted within 12 months of the acquisition date (measurement period). Any contingent consideration due is recognised at its acquisition-date fair value and included in the cost of the combination. Subsequent changes in the fair value of contingent consideration are taken to profit or loss. Acquisitions carried out on favourable terms If, after remeasurement, the net of the acquisition-date amounts of the identifiable assets acquired and the financial liabilities assumed in a business combinationexceeds the aggregate of the consideration transferred, the amount of any non- controlling interests in the acquiree, and the fair value of the Group’s previously held interest in the acquiree (if any), the excess is recognised immediately in profit or loss as a bargainpurchasegain.

Non-controllinginterestsentitletheholdersto a proportionateshareof the entity’snet assets in the event of liquidation.Consequently,for each business combination, non-controlling interests can be initially measured: at fair value, resulting in the recognition of • additional goodwill (the “full goodwill” method); or at the non-controlling interest’s propor- • tionate share in the recognised amounts of the acquiree’s net identifiable assets (the “partial goodwill” method). Changes in ownership interest The recognition of subsequent changes in ownership interest (through acquisitions of additional interests or disposals) depends on the definition of the impact on the control of the entity in question. If control is not affected by the change in ownership interest, the transaction is regarded as between shareholders. The difference between the purchase (or sale) value and the book value of the interest acquired (or sold) is recognised in equity. If control is affected (as is the case, for example, for business combinations achieved in stages), the interest held by the Group in the acquiree before the business combination is remeasured at fair value through profit orloss.

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2020 annual report