LEARND SE ANNUAL

Business / Consolidation

3.1 Basis of consolidation The consolidated financial statements include the balances and results of the Company and its wholly owned subsidiaries as at 31 December 2023. All transactions and balances between Group companies are eliminated on consolidation and there are no unrealized gains and losses on transactions between Group companies (except for foreign currency transaction gains or losses). Amounts reported in the consolidated financial statements of subsidiaries have been adjusted where necessary to ensure consistency with the accounting policies adopted by the Group. 3.1.1 Business combinations The Group applies the acquisition method in accounting for business combinations. The consideration transferred by the Group to obtain control of a subsidiary is calculated as the sum of the acquisition-date fair values of assets transferred, liabilities incurred and the equity interests issued by the Group, which includes the fair value of any asset or liability arising from a contingent consideration arrangement. Assets acquired and liabilities assumed are measured at their acquisition-date fair values. The excess of cost of acquisition over the fair value of the Group’s share of the identifiable net assets acquired is recorded as goodwill. If the cost of acquisition is less than the fair value of net assets of the subsidiary acquired, the difference is recognized directly in the consolidated statement of comprehensive income. Acquisition costs are expensed as incurred. On acquisition of a business, fair values are attributed to the identifiable assets, liabilities and contingent liabilities unless the fair value cannot be measured reliably, in which case the value is incorporated in goodwill. Goodwill recognized represents the excess of the fair value and directly attributable costs of the purchase consideration over the fair values to the Group's interest in the identifiable net assets, liabilities and contingent liabilities acquired. On acquisition, goodwill is allocated to cash-generating units that are expected to benefit from the combination. 3.1.2 Reverse acquisition In a business combination effected primarily by exchanging equity interest, the acquirer is usually the entity that issues its equity interests. However, in some business combinations, commonly called “reverse acquisitions” the issuing entity is the acquiree. A reverse acquisition occurs