to download the 2012 registration document. - Groupe M6

2012 FINANCIAL STATEMENTS AND RELATED NOTESAccording to IAS 36 – Impairment of assets, the recoverable value of intangible assets and property,facilities and equipment is tested at the appearance of indications of impairment.The recoverable value of unamortised intangible assets is tested at the appearance of indications ofimpairment, and as a minimum once a year.The recoverable value is determined on an asset by asset basis, unless the asset in question does notgenerate cash flows largely independent of those generated by other assets or groups of assets. Theseassets, connected at operational and cash flow generation levels constitute a Cash Generating Unit(“CGU”).A Cash Generating Unit is the smallest group of assets, which includes the asset and which generatescash flows that are largely independent of other assets or groups of assets. In this case, the recoverablevalue of the CGU is subject to the impairment test.For sports club players more particularly, the recoverable value of these intangible assets is testedseparately, player by player, and in relation to other Ligue 1 (French Football League) players as a whole.Similarly, audiovisual rights recognised as intangible assets are monitored on an individual basis. Only theoldest rights, purchased as part of the acquisition of SNC in 2005 (rights to films made from the 30s tothe 60s) are allocated to the CGUs, the establishment of which is consistent with the nature of the rightsand their original producer.Goodwill and intangible assets to which it is not possible to directly match independent cash flows aregrouped together, at the time they are first recorded, into the Cash Generating Unit to which they belong.Impairment is recognised when, as a result of specific events or circumstances arising during the period(internal or external criteria), the recoverable value of the asset or group of assets falls below its net bookvalue.The recoverable value is the higher of fair value, net of disposal costs, and value in use.The value in use retained by the Group corresponds to the discounted cash flows of the CGU, includinggoodwill, and is determined within the framework of the economic assumptions and operating conditions,as provisionally established by the Management of Métropole Télévision, in the following manner:- future cash flows stem from the medium to long term business plan (5 or 10 years) drawn up bythe Management;- beyond this timescale, the cash flows are extrapolated by application of a perpetual growth rateappropriate to the potential development of the markets in which the entity concerned operates, aswell as the competitive position held by the entity within these markets;- the discount rate applied to the cash flows is determined using the rates which are mostappropriate to the nature of the operations and the country. It takes into account the time value ofmoney and risks specific to the CGU for which cash flows have not been adjusted.Impairment recognised in respect of a cash generating unit (or group of units) is allocated firstly toreducing the book value of any goodwill associated with the cash generating unit, and subsequently tothe book value of other assets of the unit (or group of units), proportionally to the book value of eachasset of the unit (or group of units).Impairment recognised in respect of goodwill may not be reversed. As for other assets, the Groupassesses at each balance sheet date if there is any indication that impairment recognised in previousfinancial years has decreased or no longer exists. Impairment is reversed if a change has occurred inestimates used to measure the recoverable value.The book value of an asset, increased by an impairment reversal, may not exceed the book value whichwould have been measured, net of amortisation and depreciation charges, if no impairment had beenrecognised.M6 GROUP - 2012 REGISTRATION DOCUMENT - 167