NOTES TO THE FINANCIAL STATEMENTS
ASSETS AND LIABILITIES – OPERATING AND INVESTING
RAMSAY HEALTH CARE LIMITED
10 Business combinations (Continued)
Business combinations are accounted for using the acquisition method. The consideration transferred in a business combination is
measured at fair value and is calculated as the sum of the business combination date fair values of the assets transferred by the acquirer,
the liabilities incurred by the acquirer to former owners of the acquiree and the equity issued by the acquirer, and the amount of any
non-controlling interest in the acquiree. For each business combination, the acquirer measures the non-controlling interest in the acquiree
either at fair value or at the proportionate share of the acquiree's identifiable net assets. Business combination related costs are expensed
In accounting for a business combination, the Group assesses the financial assets and liabilities assumed for appropriate classification
and designation in accordance with the contractual terms, economic conditions, the Group’s operating or accounting policies and other
pertinent conditions as at the business combination date. This includes the separation of embedded derivatives in host contracts by
Any contingent consideration to be transferred by the acquirer will be recognised at fair value at the business combination date.
Contingent consideration classified as an asset or liability that is a financial instrument and within the scope of AASB 9 Financial
Instruments, is measured at fair value with changes in fair value recognised in profit or loss. If the contingent consideration is not within the
scope of AASB 9, it is measured in accordance with the appropriate standard. Contingent consideration that is classified as equity is not
remeasured and subsequent settlement is accounted for within equity.
Key Accounting Judgements, Estimates and Assumptions
The Group recognises the identifiable assets and liabilities of businesses at their business combination date fair values. Where a
significant amount of land and buildings are recognised in the business combination, the fair value will be determined by an external
valuer using an approach relevant to the market in that country.
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