Annual Report and Accounts 2006 - DCC plc

86notes to the financial statements20. Intangible assets - continuedThe recoverable amount of each CGU is based on a value in use computation. The cash flow forecasts employed for thiscomputation are extracted from a three year plan and specifically exclude future acquisition activity. Cash flows for afurther two years are based on the assumptions underlying the three year plan. A terminal value reflecting inflation isapplied to the year five cash flows. A present value of the future cash flows is calculated using a before-tax discount raterepresenting the Group’s estimated before-tax average cost of capital (6.8%). Applying these techniques, no impairmentarose in 2006 (2005: nil).Key assumptions include management’s estimates of future profitability, capital expenditure requirements, working capitalinvestment and tax considerations. Forecasts are generally based on historical performance together with management’sexpectation of future trends affecting the industry and other developments and initiatives in the business.Useful lives of intangible assetsThe useful lives of all intangible assets (excluding goodwill) are finite and range from three to five years depending on thenature of the asset.21. Investments in associates2006 2005Group €’000 €’000At 1 April 51,384 42,001Acquired as a subsidiary (note 45) - (7,916)Share of profit less dividends 26,098 17,470Exchange adjustments and other (693) (171)At 31 March 76,789 51,384Details of the Group’s principal associates are shown on page 116.Investments in associates at 31 March 2006 includes goodwill of €1.201 million (2005: €1.201 million).The Group’s geographical share of the assets (including goodwill) and liabilities of its associates is as follows:Non-current Current Non-current Current Netassets assets liabilities liabilities assets€’000 €’000 €’000 €’000 €’000As at 31 March 2006Ireland 1,681 105,044 (1,858) (29,760) 75,107USA 818 2,082 - (1,218) 1,6822,499 107,126 (1,858) (30,978) 76,789As at 31 March 2005Ireland 2,625 62,015 (13,017) (2,459) 49,164USA 786 2,476 - (1,042) 2,2203,411 64,491 (13,017) (3,501) 51,3842006 2005Company €’000 €’000At 31 March 1,300 1,300