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Goodwill is allocated to cash-generating units for the purpose of impairment testing. A cash generated unit
is the smallest identifiable group of assets generating cash inflows independently and represents the level
used by the Group to organise and present each activities and results in its internal reporting. Impairment
is determined for goodwill by assessing the recoverable amount of the cash-generating units, to which the
goodwill relates. Where the recoverable amount (typically the value in use) of the cash-generating units is less
than their carrying amount an impairment loss is recognised. Impairment losses relating to goodwill cannot
be reversed in future periods. The Group performs its annual impairment test of goodwill as at 31 December.
In the case where acquisition cost is less than the company’s stake in the acquired company’s net assets, the
former recalculates the acquisition cost and valuates the assets, liabilities and contingent liabilities of the
acquired company. Any difference prevailing after the recalculation is recognized directly in the income state-
ment as a profit.
Software:
Software licenses are valued in cost of acquisition less accumulated depreciation. Depreciation is
calculated using the straight line method during the assets’ useful life that range from 1 to 3 years.
Production, Installation and Operation Licenses of Renewable Energy Assets and Thermal Energy Assets:
The different types of licenses entitles the group either with the right to construct an energy asset or the
right to produce and sell energy. Current market conditions provide adequate evidence about the recoverable
amount of such licenses. Therefore the Group has recognized licenses as intangible assets at fair value less
depreciation and less any provision for impairment. The Group runs impairment tests on a yearly basis using
the following methodology:
i) Attach possibility factors according to management estimation regarding the construction of assets under
license
ii) Runs Discounted Cash Flows (DCF) methodology using assumptions prevailing at the energy market. The
period regarded by the management for provisions exceeds the five years encouraged by IAS 36 as, especially
for the renewable energy assets, there is satisfactory visibility for a substantially longer period.
iii) The final recoverable amount is calculated for a total portfolio of either renewable or thermal energy assets
by multiplying the overall possibility factor with the outcome of the DCF valuation.
iv) Finally, the Group compares the recoverable value calculated to be the value-in-use of the assets with their
carrying amounts. When the recoverable value is less than the carrying amount an equal impairment provision
is charged to the income statement.
For the reported period, an impairment loss of € 10 mio. was recognized (note. 6.26)
Legal rights to explore mines:
The legal rights to explore mines concern rights that the group has acquired
mining mineral reserves in several geographical areas. In cost of the mining rights, apart from nominal value
of the rights, any cost that relates to the initial evaluation of the rehabilitation cost of the area where work has
been done, the commitment of the Group either during the acquirement of the right or as a result of its use
for a certain time period. The depreciation time period that is adopted by the Group does not exceed 10 years.
Right of Use of Tangible Assets: Rights of exploitation of tangible assets that are granted in the frames of con-
ventions of manufacture of work (compensative profits) are valued in cost of acquisition, which equals their
