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SEE HUP SENG LIMITED
Annual Report 2012
72
Notes to the Financial Statements
31 DECEMBER 2012
11 Financial Assets, Available-For-Sale
Group Company
2012 2011 2012 2011
S$’000 S$’000 S$’000 S$’000
Unquoted equity shares, at cost
– Balance at beginning of year 317 290 290 290
Fair value adjustments (15)
Additions 7,322 27 7,322 –
Balance at end of year 7,624 317 7,612 290
The management estimates that the fair value of unquoted equity shares approximates their carrying amounts.
Additions during the year represent the Group’s and the Company’s investment in unquoted equity shares,
representing a 11.9% interest in the investee.
12 Club Membership
Group
2012 2011
S$’000 S$’000
Club membership, at cost 195 195
13 Goodwill
Group
2012 2011
S$’000 S$’000
Goodwill on consolidation:
At cost:
Balance at the beginning of the year 9,465 9,462
Acquisition of subsidiary 2,753 –
Impairment of goodwill (454) –
Currency translation difference (29) 3
Balance at year end 11,735 9,465
Impairment testing for cash-generating-units (“CGU”) containing goodwill
For the purpose of impairment testing, goodwill is allocated to the Group’s operating divisions which represent
the lowest level within the Group at which the goodwill is monitored for internal management purposes. Goodwill
of S$7,973,493 has been allocated to the distribution segment, S$1,008,055 allocated to corrosion prevention
segment and the remaining S$2,753,500 has been allocated to “others segment” as defined in Note 35.
The impairment of S$454,000 has been made during the year because management believes that a CGU of
the distribution segment located in a different geographical segment will not be able to generate adequate
cashflows above its carrying amount of goodwill. The impairment loss of S$454,000 has been recognised in
other operating expenses in profit or loss.
The Group prepares cash flow forecasts derived from the most recent financial budgets approved by
management for the next five years at an estimated growth rate of 5% (2011: 5%) per annum and perpetual
growth rate of 3% per annum (2011: 3%).