Nokia 2013 Annual Report Download - page 107

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CRITICAL ACCOUNTING POLICIES
Cashgeneratingunits
Radio Access
Networks group
of CGUs in Global Services
HERE Mobile Broadband 1 group of CGUs 1 NSN
% % % %
2013 2012 2013 2012 2013 2012 2013 2012
Terminalgrowthrate 1.7 1.7 1.5 — 0.5 — — 0.7
Post-taxdiscountrate 10.6 9.9 10.8 — 10.1 — — 10.3
 NSN CGU is divided into two groups of CGUs in : Radio Access Networks group of CGUs
within Mobile Broadband operating segment and the Global Service group of CGUs.
CGU (EUR   million), NSN Mobile Broadband group of CGUs
(EUR  million) and NSN Global Services group of CGUs (EUR 
million).
IAS  requires goodwill to be assessed annually for im-
pairment unless triggering events are identifi ed prior to the
annual testing date that indicate a potential impairment in
which case an interim assessment is required. The annual
impairment testing for the Devices & Services and HERE CGUs
is performed as of October . The annual impairment testing
for the Nokia Solutions and Networks related groups of CGUs
has been performed as of September . An additional impair-
ment analysis specifi c to NSN CGUs was performed subse-
quently at November ,  to align the annual testing date
with the NSN’s annual fi nancial planning cycle. Management
determined that the signing of the agreement with Microsoft
for the Sale of D&S Business constituted a triggering event re-
quiring an interim impairment test for the Devices & Services
and HERE CGUs. Accordingly, an interim review was performed
in September . No impairment charges were recorded for
any of the CGUs as a result of either the interim or annual tests.
The recoverable values of the Smart Devices and Mobile
Phones CGUs, that are now combined to form the Devices &
Services CGU and are classifi ed as discontinued operations in
, were previously valued using a value in use basis. During
, the Devices & Services CGU recoverable value was de-
termined using a fair value less cost of disposal model based
on the agreed purchase price defi ned for the Sale of D&S
Business, excluding any consideration attributable to patents
or patent applications.
During , the recoverable amounts of the HERE CGU,
Radio Access Networks and Global Services Group of CGUs
have been determined using a fair value less cost of disposal
model. Fair value less cost of disposal was estimated using
discounted cash fl ow calculations. The cash fl ow projections
employed in the discounted cash fl ow calculations have been
determined by management based on the information avail-
able, to refl ect the amount that an entity could obtain from
separate disposal of each of the CGUs in an orderly transaction
between market participants at the measurement date after
deducting the estimated cost of disposal. The estimates of
fair value less cost of disposal are categorized as level  of the
fair value hierarchy.
Discounted cash fl ows for the Nokia Solutions and Networks
groups of CGUs and HERE CGU were modeled over ten an-
nual periods. The growth rates used in transition to terminal
year refl ect estimated long term stable growth which do not
exceed long-term average growth rates for the industry and
economies in which the CGUs operate. All cash fl ow projections
are consistent with external sources of information, wherever
possible.
The key assumptions applied in the impairment testing for
each CGU in the annual goodwill impairment testing for each
year indicated are presented in the table below. No informa-
tion has been included for the Devices & Services CGU as the
recoverable amount was not determined using a discounted
cash fl ow analysis and the CGU is attributable to discontinued
operations: