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HYUNDAI MOTOR COMPANY Annual Report 2014
FINANCIAL STATEMENTS / 117116
(2) The changes in intangible assets for the year ended December 31, 2014, are as follows:
In millions of Korean Won
Description
Beginning of
the year
Internal
developments
and separate
acquisitions
Transfers
within
intangible
assets Disposals Amortization
Impairment
loss Others (*)
End of
the year
Goodwill ￦ 299,352 ￦ - ￦ - ￦ - ￦ - ￦ (1,429) ￦ (11,445) ￦ 286,478
Development
costs 1,945,557 1,117,115 33,377 (4,386) (564,905) (9,391) 37,616 2,554,983
Industrial
property rights 44,367 40,605 16,141 - (9,571) - (1,580) 89,962
Software 273,421 14,811 45,800 (124) (103,560) - 84,633 314,981
Others 291,903 6,977 27,749 (3,305) (28,059) (358) 18,978 313,885
Construction in
progress 274,490 173,962 (123,067) - - (17,418) (46,600) 261,367
￦ 3,129,090 ￦ 1,353,470 ￦ - ￦ (7,815) ￦ (706,095) ￦ (28,596) ￦ 81,602 ￦ 3,821,656
(*) Others include the effect of foreign exchange differences and transfer from or to other accounts.
The changes in intangible assets for the year ended December 31, 2013, were as follows:
In millions of Korean Won
Description
Beginning of
the year
Internal
developments
and separate
acquisitions
Transfers
within
intangible
assets Disposals Amortization
Impairment
loss Others (*)
End of
the year
Goodwill ￦ 301,011 ￦ - ￦ - ￦ - ￦ - ￦ - ￦ (1,659) ￦ 299,352
Development
costs 1,854,606 781,694 5,060 (15,198) (658,684) (27,250) 5,329 1,945,557
Industrial
property rights 32,441 5,553 12,696 - (7,220) - 897 44,367
Software 230,673 34,650 30,826 (319) (84,814) - 62,405 273,421
Others 315,867 1,518 12,522 (2,282) (31,635) (911) (3,176) 291,903
Construction in
progress 148,620 196,495 (61,104) - - - (9,521) 274,490
￦ 2,883,218 ￦ 1,019,910 ￦ - ￦ (17,799) ￦ (782,353) ￦ (28,161) ￦ 54,275 ￦ 3,129,090
(*) Others include the effect of foreign exchange differences and transfer from or to other accounts.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 2014 AND 2013
(3) Research and development expenditures for the years ended December 31, 2014 and 2013, are as follows:
In millions of Korean Won
Description 2014 2013
Development costs (*) ￦ 1,117,115 ￦ 781,694
Research and development (manufacturing cost and administrative expenses) 1,011,789 1,067,350
￦ 2,128,904 ￦ 1,849,044
(*) Amortization of development costs is not included.
(4) Impairment test of goodwill
The allocation of goodwill amongst the Group’s cash-generating units as of December 31, 2014 and 2013, is as follows:
In millions of Korean Won
Description December 31, 2014 December 31, 2013
Vehicle ￦ 186,026 ￦ 197,471
Finance 482 1,911
Others 99,970 99,970
￦ 286,478 ￦ 299,352
The recoverable amounts of the Group’s CGUs are measured at their value-in-use calculated based on cash flow projections of fi-
nancial budgets for the next five years approved by management and the pre-tax discount rate applied to the cash flow projections
is 14.0%. Cash flow projections beyond the next five-year period are extrapolated by using the estimated growth rate which does
not exceed the long-term average growth rate of the region and industry to which the CGU belongs. An impairment loss has been
recognized for the Finance CGU in the amount of ￦1,429 million for the year ended December 31, 2014. No impairment loss had been
recognized for the year ended December 31, 2013.