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AAK Annual Report 2015

67 NOTE 15 – INTANGIBLE ASSETS Group Goodwill Patents and other intangible assets Total Cost at January 1, 2014 1,115 298 1,413 Investments 5 23 28 Acquired through business combination 58 - 58 Disposals -8 -14 -22 Exchange differences 157 13 170 Accumulated cost at December 31, 2014 1,327 320 1,647 Cost at January 1, 2015 1,327 320 1,647 Investments - 25 25 Acquired through business combination 230 256 486 Exchange differences 10 -4 6 Accumulated cost at December 31, 2015 1,567 597 2,164 Amortisation and impairment loss at January 1, 2014 0 175 175 Disposals - -14 -14 Impairment losses for the year - 23 23 Exchange differences - 9 9 Accumulated amortisation and impairment loss at December 31, 2014 0 193 193 Amortisation and impairment loss at January 1, 2015 0 193 193 Impairment losses for the year - 28 28 Exchange differences - -1 -1 Accumulated amortisation and impairment loss at December 31, 2015 0 220 220 Residual value at December 31, 2014 1,327 127 1,454 Residual value at December 31, 2015 1,567 377 1,944 Reviewing impairment of goodwill In preparing the financial statements for 2015, the Group has reviewed impairment of goodwill.   Goodwill is allocated to cash-generating units. The recoverable amount for a cash-generating unit is determined by calculating its value in use. These calculations are based on estimated future cash flow as stated in budgets and forecasts covering a five-year period. Cash flow beyond this period has been extrapolated by no more than 3 percent (3) in any case. Working capital beyond the five-year period is estimated at the same level as year five. Discount rates are assumed to be 9 percent (9) after tax and 12.8 percent (12.8) before tax. Goodwill testing of the Swedish, Danish, Belgian and Dutch units was done at an aggregate level, whereby the four production units were considered as a single cash-generating unit. Other goodwill testing considered cash-generating units at country level. Approximately 35 percent of goodwill is attributable to the business area Chocolate & Confectionery Fats and the remaining approximately 65 percent to Food Ingredients.   Testing has not demonstrated any need for impairment. The sensitivity in these calculations indicates that recognised goodwill is still intact even if the discount rate increases by 1 percent or if long-term growth is 1 percent less. Goodwill by cash-generating unit 2015 2014 Scandinavia, including Belgium and the Netherlands 512 528 United Kingdom 74 72 Turkey 58 68 USA 651 603 Colombia 45 56 India 227 - Total 1,567 1,327


AAK Annual Report 2015
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