| Goodwill | Computer | Others | ||||||||||||||
| (note(a)) | software | (note(b)) | Total | |||||||||||||
| RMB million | RMB million | RMB million | RMB million | |||||||||||||
|
31 December 2017 |
||||||||||||||||
|
Cost at 1 January 2017, net of accumulated amortization |
11,270 | 288 | 66 | 11,624 | ||||||||||||
|
Additions |
— | 126 | — | 126 | ||||||||||||
|
Transfer from construction in process |
— | 3 | — | 3 | ||||||||||||
|
Amortization provided during the year |
— | (109 | ) | (33 | ) | (142 | ) | |||||||||
|
Disposal of a subsidiary (note 43) |
— | (14 | ) | — | (14 | ) | ||||||||||
|
Disposals |
— | (1 | ) | — | (1 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
At 31 December 2017 |
11,270 | 293 | 33 | 11,596 | ||||||||||||
|
|
|
|
|
|
|
|
|
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|
At 31 December 2017: |
||||||||||||||||
|
Cost |
11,270 | 904 | 98 | 12,272 | ||||||||||||
|
Accumulated amortization |
— | (611 | ) | (65 | ) | (676 | ) | |||||||||
|
Net carrying amount |
11,270 | 293 | 33 | 11,596 | ||||||||||||
|
|
|
|
|
|
|
|
|
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|
31 December 2016 |
||||||||||||||||
|
Cost at 1 January 2016, net of accumulated amortization |
11,270 | 252 | — | 11,522 | ||||||||||||
|
Additions |
— | 124 | 98 | 222 | ||||||||||||
|
Transfer from construction in process |
— | 9 | — | 9 | ||||||||||||
|
Amortization provided during the year |
— | (97 | ) | (32 | ) | (129 | ) | |||||||||
|
Disposals |
— | — | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
At 31 December 2016 |
11,270 | 288 | 66 | 11,624 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
At 31 December 2016: |
||||||||||||||||
|
Cost |
11,270 | 812 | 98 | 12,180 | ||||||||||||
|
Accumulated amortization |
— | (524 | ) | (32 | ) | (556 | ) | |||||||||
|
Net carrying amount |
11,270 | 288 | 66 | 11,624 | ||||||||||||
|
|
|
|
|
|
|
|
|
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Notes:
| (a) | The balance represents goodwill arising from the acquisition of Shanghai Airlines. The value of the Goodwill is attributable to strengthening the competitiveness of the Group’s airline transportation operations, attaining synergy through integration of the resources and accelerating the development of international air transportation in Shanghai. For the purpose of impairment assessment, goodwill was allocated to the cash-generating unit (“CGU”) that the Group operates and benefits from the acquisition. |
The recoverable amount of the CGU has been determined based on a value-in-use calculation using cash flow projections based on a financial budget approved by senior management. The discount rate after tax applied to the cash flow projections is 11% (2016: 11%). The growth rate used to extrapolate the cash flows of the above cash-generating unit beyond the five-year period is 3% (2016: 3%), which does not exceed the long-term average growth rate for the business in which the CGU operates. No impairment for the goodwill was required based on the value-in-use calculation as at the reporting date.
| (b) | The balance represents the costs incurred to acquire the use right of certain flight schedules (i.e. timeslots for flights’ taking off/landing). |