ANNUAL REPORT 2012 - TiGenix

of interest on the remaining balance of the
liability. Finance charges are expensed.
Rentals payable under operating leases are
charged to income on a straight-line basis
over the term of the relevant lease. Benefits
received and receivable as an incentive to
enter into an operating lease are also spread
on a straight-line basis over the lease term.
11.5.2.11. Impairment of tangible
and intangible assets
At each balance sheet date and at each
interim reporting date, the Group reviews
the carrying amount of its tangible and
intangible assets to determine whether
there is any indication that those assets have
suffered an impairment loss. If any such
indication exists, the recoverable amount of
the asset is estimated in order to determine
the extent of the impairment loss (if any).
Where the asset does not generate cash
flows that are independent from other assets,
the Group estimates the recoverable amount
of the cash-generating unit to which the
asset belongs. An intangible asset with an
indefinite useful life is tested for impairment
annually and at each interim reporting date,
and whenever there is an indication that the
asset might be impaired. The recoverable
amount is the higher of fair value less costs
to sell and value in use. The estimated future
cash flows are discounted to their present
value using a pre-tax discount rate that
reflects current market assessments of the
time value of money and the risks specific to
the asset.
If the recoverable amount of an asset or cash
generating unit is estimated to be less than
the carrying amount, the carrying amount
of the asset is reduced to its recoverable
amount. An impairment loss is immediately
recognized as an expense, unless the
relevant asset is carried at re-valued amount,
in which case the impairment is treated
as a revaluation decrease. Where an
impairment loss subsequently reverses, the
carrying amount of the asset is increased
to the revised estimate of its recoverable
amount, but so that the increased carrying
amount does not exceed the carrying
amount that would have been determined
had no impairment loss been recognized
for the asset in prior years. A reversal of an
impairment loss is recognized as income,
unless the relevant asset was carried at revaluated
amount, in which case the reversal
of the impairment is treated as a revaluation
increase
11.5.2.12. Inventories
Raw materials, consumables and goods
purchased for resale are valued at the lower
of their cost determined according to the
FIFO-method (first in first out) or their net
realisable value.
The costs of finished goods comprises all
costs of purchase , costs of conversion
and other costs incurred in bringing the
inventories to the present location and
condition.
The Group does not account for work in
progress, as the production process is short
and finished goods are shipped to customers
immediately thereafter, resulting in no such
items on the balance sheet at year-end for
any of the periods reported.
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