(a) Goodwill
Goodwill arising from an acquisition results from a surplus of the consideration paid, non-controlling interests and fair value of shares previously held in the entity over the Group’s share in the net fair value of the identifiable assets, liabilities and contingent liabilities as of the acquisition date.
If negative goodwill occurs, the Group verifies the fair value of each net asset acquired. If following the verification, the goodwill remains negative, it is immediately recognized in profit or loss.
Goodwill is initially recognized as an asset at cost and subsequently measured at cost less accumulated impairment loss.
For impairment testing purposes, goodwill is allocated to each cash generating unit (CGU) that should benefit from the post-combination synergy. CGU to which the goodwill is allocated are tested for impairment once a year or more frequently if according to reliable assumptions, impairment could occur. If the recoverable amount of a CGU is lower than its carrying amount, the impairment loss is first assigned in order to reduce the carrying amount of goodwill allocated to that CGU, and then to other assets of the unit pro rata to the carrying amount of each asset belonging therein. The impairment loss recognized for goodwill is not reversed in the following period.
(b) Other intangible assets
Other intangible assets include: computer software, licenses as well as other intangible assets. Intangible assets are measured at acquisition price or manufacturing cost less accumulated amortization and accumulated impairment losses.
Amortization is calculated based on the straight-line method, taking into account the estimated useful life amounting to:
- for server licenses and software 2 - 10 years;
- for workstation licenses and software as well as anti-virus software 4 - 10 years;
- for other intangible assets 2 - 7 years.