# 13. INVESTMENT IN ASSOCIATED COMPANY

<table><tr><td rowspan="3"></td><td colspan="2">The Group</td><td colspan="2">The Company</td></tr><tr><td>2016</td><td>2015</td><td>2016</td><td>2015</td></tr><tr><td>$’000</td><td> $’000</td><td> $’000</td><td> $’000</td></tr><tr><td>Investment in associated company</td><td>4,313</td><td>3,859</td><td>2,895</td><td>2,895</td></tr></table>

The Group’s investment in an associated company (Note 29) is not material to the Group. There are no contingent liabilities relating to the Group’s interest in the associated company.

In 2015, the Group’s equity accounting/gains on associated companies recognised in the income statement included a gain of \$47,570,000 arising from the partial disposal and reclassification of an associated company to available-for-sale financial assets.

# 14. FINANCIAL ASSETS (FVOCI) / AVAILABLE-FOR-SALE FINANCIAL ASSETS

As disclosed in Note 2(a), the Group has early adopted FRS 109 effective 1 January 2016 and elected, at initial adoption, to present in other comprehensive income changes in the fair value of all its equity investments previously classified as available-for-sale financial assets. In accordance with the transitional provisions in FRS 109, comparative figures have not been restated.

# (a) For 2016, equity investments at fair value through other comprehensive income (FVOCI) mainly comprise the following:

<table><tr><td rowspan="2"></td><td>Group</td></tr><tr><td>2016</td></tr><tr><td></td><td>$’000</td></tr><tr><td>Shares of a financial institution</td><td>1,467,127</td></tr><tr><td>Shares of two real estate companies</td><td>460,203</td></tr></table>

These investments comprise mainly quoted investments and were previously classified as available-for-sale financial assets in 2015.

# (b) During the financial year, the Group elected to receive \$33,246,000 (2015: \$22,398,000) of dividend income as non-cash financial assets (FVOCI) / available-for-sale financial assets in lieu of cash dividends.

(c) Certain financial assets (FVOCI) / available-for-sale financial assets valued at \$169,307,000 (2015: \$175,441,000) are pledged as security for bank credit facilities (Note 20).

(d) There are no material investments held by the Company in 2016 and 2015.

# 15. INTANGIBLE ASSETS

<table><tr><td rowspan="3"></td><td colspan="2">The Group</td><td colspan="2"> The Company</td></tr><tr><td>2016</td><td>2015</td><td>2016</td><td>2015</td></tr><tr><td>$’000</td><td>$’000</td><td> $’000</td><td> $’000</td></tr><tr><td>Goodwill on consolidation</td><td>11,116</td><td>11,116</td><td>–</td><td>–</td></tr><tr><td>Trademarks and deferred expenditure</td><td>–</td><td>–</td><td>–</td><td>–</td></tr><tr><td></td><td>11,116</td><td>11,116</td><td>–</td><td>–</td></tr></table>

# (a) Goodwill on consolidation

<table><tr><td rowspan="3"></td><td colspan="2">The Group</td></tr><tr><td>2016</td><td>2015</td></tr><tr><td>$’000</td><td> $’000</td></tr><tr><td>Cost</td><td></td><td></td></tr><tr><td>Balance at beginning and end of financial year</td><td>11,116</td><td>11,116</td></tr></table>

# Impairment test for goodwill

The goodwill is allocated to the healthcare division of the Group, which is regarded as a cash-generating unit (“CGU”).

During the financial year, the Group has determined that there was no impairment of its CGU containing the goodwill. The recoverable amount (i.e. higher of value-in-use and fair value less costs to sell) of the CGU is determined on the basis of value-in-use calculations. These calculations incorporate cash flow projections by management covering a five-year period.

Key assumptions used for value-in-use calculations:

Discount rate 5.6% (2015: 5.5%)

Growth rate 0.0% (2015: 0.0%)

These assumptions have been used for the analysis of the CGU. The discount rate used is pre-tax and reflects specific risks relating to the healthcare division. Based on the sensitivity analysis performed, any reasonable change in the key assumptions would not result in any impairment adjustments.