AGS Transact Technologies Limited

Annexure V - Basis of preparation and Significant Accounting Policies

Notes to the Revised Restated Consolidated Financial Information

 

 

Asset Useful life (years)
Licenses and Technical know-how 7
Software 4

 

 

The estimated useful life of an intangible asset in a service concession arrangement is the period of contract.

The amortisation period and the amortisation method are reviewed at each reporting date. If the expected useful life
of the asset is significantly different from previous estimates, the amortisation period is changed accordingly.

(v) Expenditure on research and development

Expenditure on research activities is recognised in Revised Restated Consolidated Statement of Profit and Loss as
incurred.

Development expenditure is capitalised as part of the cost of the resulting intangible asset only if the expenditure
can be measured reliably, the product or process is technically and commercially feasible, future economic benefits
are probable, and the Group intends to and has sufficient resources to complete development and to use or sell the
asset. Otherwise, it is recognised in Revised Restated Consolidated Statement of Profit and Loss as incurred.

Following the initial recognition of the development expenditure as an asset, the cost model is applied requiring the
asset to be carried at cost less any accumulated amortisation and accumulated impairment losses, if any.
Amortisation of the asset begins when development is complete and the asset is available for use. It is amortised on
a straight line basis over the period of expected future benefit from the related project. Amortisation is recognised in
the Revised Restated Consolidated Statement of Profit And Loss.

During the period of development, the asset is tested for impairment annually.

Government Grants

Government grants including non-monetary grants at fair value are not recognised until there is reasonable assurance
that the Group will comply with the conditions attached to them and that the grants will be received.

Government grants are recognised in the Revised Restated Consolidated Statement of Profit and Loss as other
income on a systematic basis over the periods in which the Group recognises as expenses the related costs for which
the grants are intended to compensate.

Impairment of non-financial assets

The Groups’s non-financial assets, other than inventories and deferred tax assets, are reviewed at each reporting date
to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable
amount is estimated.

For impairment testing, assets that do not generate independent cash inflows are grouped together into cash-

generating units (CGUs). Each CGU represents the smallest group of assets that generates cash inflows that are
largely independent of the cash inflows of other assets or CGUs.

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