BAKERTECHNOLOGYLIMITED
ANNUALREPORT2013
110
Notes to the
Financial Statements
for the financial year ended 31December 2013
12. Goodwill
$
Group
Cost :
At 1 January 2012, 31December 2012, 1 January 2013 and 31December 2013
7,551,331
Accumulated impairment :
At 1 January 2012, 31December 2012, 1 January 2013 and 31December 2013
–
Net carrying amount :
31December 2012 and 31December 2013
7,551,331
Impairment testing of goodwill
The goodwill was derived from the acquisition of SeaDeep Shipyard Pte. Ltd., the cash generatingunit (CGU).
Group
2013
2012
$
$
SeaDeep Shipyard Pte. Ltd.
7,551,331 7,551,331
The recoverable amount of the CGU has been determined based on value in use calculations using cash flow projections from
financial budgets approved bymanagement covering a five-year period.Management have considered and determined the factors
applied in these financial budgets.
A pre-tax discount rate of 10% (2012: 10%) per annum, which is commonly adoptedwithin the industry, was applied to the cash
flowprojections. Inaddition,management has alsoadopteda conservative forecastedgrowth rateof 3% (2012: 3%) per annum for
5 years cashflowprojections. Thebulkof theGroup’s profit relates to theoperations of theSeaDeepGroup.Given this information,
the recoverable amount is not sensitive toother assumptions.
No impairment losswas required for the carryingamount of goodwill assessedas at 31December 2013and2012as the recoverable
amount of theCGUwas in excess of the carrying value.
