190 Notes to the Consolidated Financial Statements 31 December 2023 19. GOODWILL US$’000 At 1 January 2022 Cost 542,636 Accumulated impairment — Net carrying amount 542,636 Cost at 1 January 2022, net of accumulated impairment 542,636 Acquisition of subsidiaries 2,912,862 At 31 December 2022 3,455,498 At 31 December 2022 Cost 3,455,498 Accumulated impairment — Net carrying amount 3,455,498 Cost at 1 January 2023, net of accumulated impairment 3,455,498 Acquisition of subsidiaries (note 34) 27,075 Impairment (13,571) Exchange realignment 440 At 31 December 2023 3,469,442 At 31 December 2023 Cost 3,483,013 Accumulated impairment (13,571) Net carrying amount 3,469,442 Impairment testing of goodwill As of 31 December 2023, the Group’s goodwill is allocated to the Redwood asset management business cashgenerating unit, Infinitysub asset management business cash-generating unit, ESR Australia asset management business cash-generating unit, SIP asset management business cash-generating unit, and ARA asset management business cash-generating unit for impairment testing. Redwood asset management business cash-generating unit The recoverable amount of the Redwood assets management business cash-generating unit has been determined based on a value in use calculation using cash flow projections based on financial budgets covering a five-year period approved by senior management. The discount rate applied to the cash flow projections is 10.2%. The growth rate used to extrapolate the cash flows of the Redwood asset management business cash-generating unit beyond the five-year period is 2.0%. This growth rate is based on the average growth rate of the management fee in which the business operates. Management believes that this growth rate is reasonable. The Company has engaged independent professionally qualified valuers for the impairment assessment. Infinitysub asset management business cash-generating unit The recoverable amount of the Infinitysub asset management business cash-generating unit has been determined based on a value-in-use calculation using cash flow projections based on financial budgets covering a fiveyear period approved by senior management. The discount rate applied to the cash flow projections is 8.5%. The growth rate used to extrapolate the cash flows of the Infinitysub business cash-generating unit beyond the five-year period is 2.5%. This growth rate is based on the average growth rate of the management fee in which the business operates. Management believes that this growth rate is reasonable. The Company has engaged independent professionally qualified valuers for the impairment assessment. STRENGTH IN UNITY
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