English version - Hexagon Composites ASA

COMROD COMMUNICATION ASA – LISTING ON THE OSLO STOCK EXCHANGE
business combination is, from the acquisition date, allocated to each of the Group's cash generating
units, or groups of cash generating units, that are expected to benefit from the synergies of the
combination, irrespective of whether other assets or liabilities of the Group are assigned to those units
or groups of units. Each unit or group of units to which the goodwill is allocated:
- represents the lowest level within the Group at which the goodwill is monitored for internal
management purposes; and
- is not larger than a segment based on either the Group's primary or the Group's secondary reporting
format determined in accordance with IAS 14, Segment Reporting.
Where goodwill forms part of a cash-generating unit (group of cash generating units) and part of the
operation within that unit is disposed of, the goodwill associated with the operation disposed of is
included in the carrying amount of the operation when determining the gain or loss on disposal of the
operation. Goodwill disposed of in this circumstance is measured based on the relative values of the
operation disposed of and the portion of the cash-generating unit retained.
When subsidiaries are sold, the difference between the selling price and the net assets plus cumulative
translation differences and unamortised goodwill is recognised in the income statement
7.1.17 Research and development
Expenses relating to research are recognised in the income statement in the year in which the
expenditure is incurred. Expenses relating to development are recognised in the income statement in
the year in which the expenditure is incurred unless the following criteria are met in full:
- the product or process is clearly defined and expenditure can be identified and measured reliably;
- the technical solution for the product has been demonstrated;
- the product or process will be sold or used in the business;
- the asset will generate future benefits; and
- sufficient technical, financial and other resources to complete the project are in place.
When all criteria are met, development costs are capitalised. Costs which have been expensed in
previous accounting periods are not capitalised. Capitalised development costs are amortised over the
asset’s estimated useful life. The carrying amount of development costs is reviewed when there is an
indication of impairment, or when impairment losses from previous periods no longer apply.
7.1.18 Provisions
A provision is recognised when, and only when, the company has a present obligation (legal or
constructive) as a result of a past event and it is probable (more likely than not) that an outflow of
resources embodying economic benefits will be required to settle the obligation, and a reliable
estimate can be made of the amount of the obligation. Provisions are reviewed at each balance sheet
date and adjusted to reflect the current best estimate. If the effect of the time value of money is
immaterial, the amount of the provision will be equal to the expenditures required to be free of the
obligation. If the effect of the time value of money is material, the amount of the provision will be the
present value of the expenditures required to settle the obligation. Any increase in the provisions due
to time is presented as interest costs.
A provision for guarantees is recognised when the underlying products or services are sold. The
provision is based on historical information about guarantees and a weighting of all possible outcomes
by their associated probabilities.
A provision for onerous contracts is recognised when the group’s expected economic benefits
expected to be received under the contract are lower than the unavoidable costs of meeting the
obligations under the contract.
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