Barclays 2015 Annual Report Download - page 300

298 I Barclays PLC Annual Report 2015 home.barclays/annualreport
Notes to the financial statements
Non-current assets and other investments
24 Goodwill and intangible assets
Accounting for goodwill and other intangible assets
Goodwill
The carrying value of goodwill is determined in accordance with IFRS 3 Business Combinations and IAS 36 Impairment of Assets.
Goodwill arises on the acquisition of subsidiaries, associates and joint ventures, and represents the excess of the fair value of the purchase
consideration over the fair value of the Group’s share of the assets acquired and the liabilities and contingent liabilities assumed on the date of the
acquisition.
Goodwill is reviewed annually for impairment, or more frequently when there are indications that impairment may have occurred. The test involves
comparing the carrying value of goodwill with the present value of the pre-tax cash flows, discounted at a rate of interest that reflects the inherent
risks of the cash generating unit (CGU) to which the goodwill relates, or the CGU’s fair value if this is higher.
Intangible assets
Intangible assets other than goodwill are accounted for in accordance with IAS 38 Intangible Assets and IAS 36 Impairment of Assets.
Intangible assets include brands, customer lists, internally generated software, other software, licences and other contracts and core deposit
intangibles. They are initially recognised when they are separable or arise from contractual or other legal rights, the cost can be measured reliably
and, in the case of intangible assets not acquired in a business combination, where it is probable that future economic benefits attributable to the
assets will flow from their use.
Intangible assets are stated at cost (which is, in the case of assets acquired in a business combination, the acquisition date fair value) less
accumulated amortisation and provisions for impairment, if any, and are amortised over their useful lives in a manner that reflects the pattern to
which they contribute to future cash flows, using the amortisation periods set out below:
Annual rates in calculating amortisation Amortisation period
Goodwill Not amortised
Internally generated software 12 months to 6 years
Other software 12 months to 6 years
Core deposits intangibles 12 months to 25 years
Brands 12 months to 25 years
Customer lists 12 months to 25 years
Licences and other 12 months to 25 years
Intangible assets are reviewed for impairment when there are indications that impairment may have occurred.
Goodwill
£m
Internally
generated
software
£m
Other
software
£m
Core
deposit
intangibles
£m
Brands
£m
Customer
lists
£m
Licences
and other
£m
Total
£m
2015
Cost
As at 1 January 2015 6,329 3,240 482 186 112 1,721 447 12,517
Additions and disposals (515) 998 75 – – – 18 576
Exchange and other movements (211) (126) (15) (40) (26) (56) 6 (468)
As at 31 December 2015 5,603 4,112 542 146 86 1,665 471 12,625
Accumulated amortisation and impairment
As at 1 January 2015 (1,442) (1,257) (194) (88) (111) (962) (283) (4,337)
Disposals 518 128 2 – – – 3 651
Amortisation charge – (421) (17) (6) – (143) (30) (617)
Impairment charge (102) (101) (1) (1) – (12) – (217)
Exchange and other movements 28 17 (2) 20 25 36 (7) 117
As at 31 December 2015 (998) (1,634) (212) (75) (86) (1,081) (317) (4,403)
Net book value 4,605 2,478 330 71 – 584 154 8,222
2014
Cost
As at 1 January 2014 6,346 2,411 556 194 116 1,543 437 11,603
Additions and disposals 36 702 176 – – 123 7 1,044
Exchange and other movements (53) 127 (250) (8) (4) 55 3 (130)
As at 31 December 2014 6,329 3,240 482 186 112 1,721 447 12,517
Accumulated amortisation and impairment
As at 1 January 2014 (1,468) (999) (217) (85) (97) (799) (253) (3,918)
Disposals – 98 21 – – 14 2 135
Amortisation charge – (306) (19) (7) (18) (142) (30) (522)
Impairment charge – (74) (21) – – (5) – (100)
Exchange and other movements 26 24 42 4 4 (30) (2) 68
As at 31 December 2014 (1,442) (1,257) (194) (88) (111) (962) (283) (4,337)
Net book value 4,887 1,983 288 98 1 759 164 8,180