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Vodafone Group Plc Annual Report 2011 99
Financials
During the year ended 31 March 2010 the goodwill in relation to the Group’s operations in India was impaired by £2,300 million primarily due to intense
price competition following the entry of a number of new operators into the market. The pre-tax risk adjusted discount rate used in the previous value in
use calculation at 31 March 2009 was 12.3%.
In addition, impairment losses of £200 million, previously recognised in respect of intangible assets in relation to the Group’s operations in Turkey, were
reversed. The reversal was in relation to licences and spectrum and was as a result of favourable changes in the discount rate. The cash flow projections
within the business plans used for impairment testing were substantially unchanged from those used at 31 March 2009. The pre-tax risk adjusted discount
rate used in the previous value in use calculation at 31 March 2009 was 19.5%.
Year ended 31 March 2009
The impairment losses were based on value in use calculations. The pre-tax adjusted discount rates used in the value in use calculation in the year ended
31 March 2009 were as follows:
Pre-tax adjusted
discount rate
Spain 10.3%
Turkey 19.5%
Ghana 26.9%
During the year ended 31 March 2009 the goodwill in relation to the Group’s operations in Spain was impaired by £3,400 million following a fall in long-term
cash flow forecasts resulting from the economic downturn.
In addition, the goodwill and other intangible assets in relation to the Group’s operations in Turkey was impaired by £2,250 million. At 30 September 2008
the goodwill was impaired by £1,700 million following adverse movements in the discount rate and adverse performance against previous plans. During
the second half of the 2009 financial year, impairment losses of £300 million in relation to goodwill and £250 million in relation to licences and spectrum
resulted from adverse changes in both the discount rate and a fall in the long-term GDP growth rate. The cash flow projections within the business plans
used for impairment testing were substantially unchanged from those used at 30 September 2008.
The goodwill in relation to the Group’s operations in Ghana was also impaired by £250 million following an increase in the discount rate.
Goodwill
The carrying value of goodwill at 31 March was as follows:
2011 2010
£m £m
Germany 12,200 12,301
Italy 13,615 14,786
Spain 7,133 10,167
32,948 37,254
Other 12,288 14,584
45,236 51,838