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Wavin Annual Report 2010 | page 112The increase is supported by expected market recovery and the impact of certain cost reduction programmes that have beenimplemented in recent years.We have extended our projections beyond fi ve years as we expect further (modest) growth in the years just after the recovery.Beyond the projected period, results are extrapolated using an assumed growth rate that does not exceed 1% in maturemarkets and 2% in the emerging markets. Projected cash fl ows are discounted using a specifi c discount rate per cashgenerating unit (CGU), taking country risk premiums into account. The pre-tax discount rates used ranged from 8.8% to11.9%. The average pre-tax discount rate for the Group was 9.5% (2009: 10.1%). The discount rate decreased compared tolast year as a result of a reduced rate for risk-free debt.We have performed a sensitivity analysis on the base case assumptions. We have concluded that the outcome of thesensitivity analysis of an adverse change in key assumptions (50% lower growth rate or 200 basis points lower cost coveringor a 200 basis points higher discount rate) will not lead to a materially different outcome of the impairment test. Because therecoverable amount of non-current assets including goodwill and brand names was determined to be higher than the carryingamount, no impairment loss was recognised.Amortisation chargeIntangible assets not being goodwill and brand names are amortised over the estimated economic lifetime. If an impairmentindicator exists, an impairment test is performed. In cases where the book value of an asset exceeds the recoverable amountan impairment charge is recognised in the income statement. The amortisation charge is recognised in the following line itemsin the income statement:(€ x 1,000) 2010 2009Cost of sales (175) (216)Research & development expenses (1,524) (1,148)Administrative expenses (4,937) (4,725)Other operating expenses (6,250) (6,762)Total (12,886) (12,851)Recurring (12,731) (12,851)Non-recurring (155) –