Reebok 2010 Annual Report Download - page 203

Consolidated Financial Statements Notes Notes to the Consolidated Statement of Financial Position 199
Trademarks and other intangible assets 13
Trademarks and other intangible assets consist of the following:
Trademarks and other intangible assets
€ in millions
Dec. 31, 2010 Dec. 31, 2009
Reebok 1,159 1,075
Rockport 163 152
Reebok-CCM Hockey 98 90
TaylorMade-adidas Golf 27 25
Trademarks, gross 1,447 1,342
Less: accumulated amortisation and impairment losses 0 0
Trademarks, net 1,447 1,342
Software, patents and concessions, gross 600 538
Less: accumulated amortisation and impairment losses 458 378
Other intangible assets, net 142 160
Trademarks and other intangible assets, net 1,589 1,502
At December 31, 2010, trademarks, mainly related to the acquisition of Reebok International Ltd.
(USA) in 2006 and Ashworth, Inc. in 2008, have indefinite useful lives. This is due to the expectation
of permanent use of the acquired brand names.
The Group tests at least on an annual basis whether trademarks with indefinite useful lives
are impaired. This requires an estimation of the fair value less costs to sell of the trademarks.
Estimating the fair value less costs to sell requires the Group to make an estimate of the expected
future brand-specific sales and appropriate arm’s length notional royalty rates from the cash-
generating unit and also to choose a suitable discount rate in order to calculate the present value
of those cash flows. There was no impairment expense for the years ending December 31, 2010
and 2009.
Future changes in expected cash flows and discount rates may lead to impairments of the
accounted trademarks in the future.
Amortisation expenses for intangible assets with definite useful lives were € 55 million and
€ 66 million for the years ending December 31, 2010 and 2009, respectively see also Note 30.
Impairment losses amounted to € 11 million and € 19 million for the years ending December 31,
2010 and 2009, respectively see also Note 30. These are related to distribution and licensing rights,
for which no future economic benefit exists.
For details see Statement of Movements of Intangible and Tangible Assets see Attachment I
to these Notes.
Long-term financial assets 14
Long-term financial assets include a 9.7% investment in FC Bayern München AG (2009: 10%) of
€ 79 million (2009: € 79 million). The percentage share held in the investment has decreased due
to the issuance of new shares which have been bought by another shareholder. This investment is
classified as “fair value through profit or loss” and recorded at fair value. This equity security does
not have a quoted market price in an active market, therefore existing contractual settlements
were used in order to calculate the fair value as at December 31, 2010. Dividends are distributed
by FC Bayern München AG instead of regular interest payments.
Additionally, long-term financial assets include investments which are mainly invested in
insurance products and are measured at fair value, as well as other financial assets.
Long-term financial assets
€ in millions
Dec. 31, 2010 Dec. 31, 2009
Investment in FC Bayern München AG 79 79
Investments 14 12
Other financial assets 0 0
Long-term financial assets 93 91
Fair value adjustments from impairment losses amounted to € 0 million and € 5 million for the
years ending December 31, 2010 and 2009, respectively. These are related to impairments of other
financial assets to cover anticipated risks of default see also Note 32.
Other non-current financial assets 15
Other non-current financial assets consist of the following:
Other non-current financial assets
€ in millions
Dec. 31, 2010 Dec. 31, 2009
Interest rate derivatives 8 4
Currency options 12 19
Forward contracts 10 2
Security deposits 24 21
Other financial assets — 12
Other non-current financial assets 54 58
Information regarding forward contracts as well as currency options and interest rate derivatives
is also included in these Notes see also Note 28.