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The capitalisation of borrowing costs ceases when essentially all the activities needed to render a qualifying asset
available for use have been completed.
Improvement expenditure is only added to the carry amount of the asset concerned or recorded as a separate asset,
as appropriate, if it is likely that the related future economic benefits will accrue to the company and the costs can
be determined reliably. The cost of repairs, maintenance and other work to keep assets operational are charged to the
income statement as incurred.
Leasehold improvements are generally classified as part of property, plant and equipment, depending on the nature of
the costs incurred. They are depreciated over the residual life of the tangible asset concerned or the residual duration
of the lease contract, whichever is shorter.
Goodwill
The goodwill arising from business combinations is initially measured at cost, being the difference between acquisition
cost and the Group's interest in the net fair value of the related assets, liabilities and contingent liabilities. After
initial recognition, goodwill is measured at cost net of any accumulated impairment losses. Goodwill is subjected
to impairment testing on an annual basis, or more frequently if events or changes suggest that it may not be fully
recoverable.
For impairment testing purposes, goodwill is allocated from the date of acquisition to each of the Group's cashgenerating
units that are expected to benefit from the synergies released from the acquisition, regardless of the
allocation of other assets or liabilities to the same units. This is only done if such allocation is not arbitrary. Each unit
to which goodwill is allocated:
• represents the lowest level, within the Group, at which goodwill is monitored for internal operational purposes; and
• is no broader than the primary or secondary reporting segments identified for the disclosure of Group segment
information pursuant to IAS 14 - Segment reporting.
Impairment is determined with reference to the recoverable value of the cash-generating units (or groups of units) to
which goodwill was allocated. If the recoverable value of the cash-generating units (or groups of units) is lower than
the carrying value of goodwill, such impairment in value is recognised.
Once written down, the value of goodwill cannot be reinstated.
Other intangible assets
Intangible assets purchased separately are initially capitalised at cost, while those acquired as a result of business
combinations of entities not under common control are capitalised at their fair value at the acquisition date. Following
initial recognition, intangible assets are stated at cost, net of accumulated amortisation and impairment writedowns.
The useful lives of intangible assets are either finite or indefinite.
Intangible assets with a finite life are amortised over their useful lives and subjected to impairment testing whenever
there is evidence of a possible loss in value. The period of amortisation and the methodology applied are reviewed at
the end of each financial year, or more frequently if necessary. Changes in expected useful life or in the way future
economic benefits associated with the intangible asset will be earned by the Group are recognised by modifying the
period of amortisation or the methodology applied, as appropriate, and treated as a change in accounting estimate.
The amortisation of intangible assets with finite useful lives is charged to the ‘depreciation, amortisation, write-downs
and write-backs’ caption of the income statement.
The Group has not recorded any intangible assets with an indefinite useful life except for goodwill.