Singapore Airlines 2015 Annual Report Download - page 111

2 Summary of Significant Accounting Policies (continued)
(f) Intangible assets (continued)
(iii) Brand and trademarks
The brand and trademarks were acquired in business combinations. The useful life of the brand is estimated to be
indefinite because based on the assumption that the subsidiary company is operating as a going concern, management
believes there is no foreseeable limit to the period over which the brand is expected to generate net cash inflows for
the Group. The trademarks are amortised on a straight line basis over its finite useful life of 23 to 24 years.
(iv) Goodwill
Goodwill acquired in a business combination is initially measured at cost being the excess of the cost of the business
combination over the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities.
Following initial recognition, goodwill is measured at cost less any accumulated impairment losses.
For the purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date,
allocated to each of the Group’s cash-generating units (“CGU”) that are expected to benefit from the synergies of
the combination, irrespective of whether other assets or liabilities of the acquiree are assigned to those units or
groups of units.
The CGU to which goodwill has been allocated is tested for impairment annually and whenever there is an indication
that the CGU may be impaired. Goodwill impairment is determined by assessing the recoverable amount of each
CGU to which the goodwill relates. Where the recoverable amount of the CGU is less than the carrying amount,
an impairment loss is recognised in profit or loss. Impairment losses recognised for goodwill are not reversed in
subsequent periods.
Where goodwill forms part of a CGU and part of the operation within that unit is disposed of, the goodwill associated
with the operation disposed of is included in the carrying amount of the operation when determining the gain or
loss on disposal of the operation. Goodwill disposed of in this circumstance is measured based on the relative fair
values of the operation disposed of and the portion of the CGU retained.
(v) Others
Purchased landing slots are measured initially at cost. Following initial recognition, landing slots are measured at
cost less accumulated impairment losses, if any. Landing slots based within the European Union are not amortised,
as regulations provide that these landing slots have an indefinite useful life, and are tested for impairment annually.
Licences were acquired in business combinations. These intangible assets are amortised on a straight-line basis
over an estimated useful life of 3 years.
(g) Foreign currencies
The Management has determined the currency of the primary economic environment in which the Company operates i.e.,
functional currency, to be SGD. Sales prices and major costs of providing goods and services including major operating
expenses are primarily influenced by fluctuations in SGD.
Foreign currency transactions are converted into SGD at exchange rates which approximate bank rates prevailing at dates
of transactions.
All foreign currency monetary assets and liabilities are translated into SGD using year-end exchange rates. Non-monetary
assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the exchange
rates as at the dates of the initial transactions. Non-monetary assets and liabilities measured at fair value in a foreign
currency are translated using the exchange rates at the date when the fair value was determined.
Singapore Airlines | Annual Report FY2014/15 |109