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AL MAlAYA HOLDING COMPANY K.S.C. (HOLDING) AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2010
(All amounts are in Kuwaiti Dinars)
The useful life and depreciation method are reviewed periodically to ensure that the method and
period of depreciation are consistent with the expected pattern of economic benefits from items of
fixed assets.
n) Leaseholdland
Leasehold land represents a long term lease agreement. The Group amortizes the lease value over the
lease period.
0)
Goodwill
Goodwill arising on an acquisition of a subsidiary, jointly controlled entity or associate represents the
excess of the cost of the acquisition over the fair value of the identifiable assets, liabilities and
contingent liabilities as at the date of the acquisition. Goodwill is initially recognized as an asset at
cost and is subsequently measured at cost less any accumulated impairment losses.
For the purpose of impairment testing, goodwill is allocated to each of the Group's cash-generating
units expected to benefit from the synergies of the combination. Cash-generating units to which
goodwill has been allocated are tested for impairment annually, or more frequently when there is an
indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less
than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying
amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the
basis of the carrying amount of each asset in the unit. An impairment loss recognized for goodwill is
not reversed in a subsequent period.
On disposal of a subsidiary, jointly controlled entity or associate, the attributable amount of goodwill is
included in the determination of the profit or loss on disposal.
The Group's policy for goodwill arising on the acquisition of an associate is described under
"Investment in associates" in note 2(k).
Where there is an excess of the Group's interest in the net fair value of acquiree's identifiable assets,
liabilities and contingent liabilities over cost, the Group is required to reassess the identification and
measurement of the net identifiable assets and measurement of the cost of the acquisition and
recognize immediately in the consolidated statement of income any excess remaining after that
remeasurement.
p) Impairmentof assets
At the end of each reporting period, the Group reviews the carrying amounts of its tangible and
intangible assets to determine whether there is any indication that those assets have suffered an
impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in
order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the
recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash-
generating unit to which the asset belongs.
Recoverable amount is the higher of the fair value less costs to sell and value in use. In assessing
value in use, the estimated future cash flows are discounted to their present value using a discount
rate that reflects current market assessments of the time value of money and the risks specific to the
asset.
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