Marks and Spencer 2007 Annual Report Download - page 77

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1133 IINNTTAANNGGIIBBLLEE AASSSSEETTSS
Computer
software
Computer under
Goodwill Brands software development Total
£m £m £m £m £m
AAtt 33 AApprriill 22000055
Cost or valuation 69.5 80.0 32.8 5.6 187.9
Accumulated amortisation – (2.7) (19.8) – (22.5)
Net book value 69.5 77.3 13.0 5.6 165.4
Y
Yeeaarr eennddeedd 11 AApprriill 22000066
Opening net book value 69.5 77.3 13.0 5.6 165.4
Additions – – 0.2 10.7 10.9
Transfers – – 9.5 (9.5) –
Disposals – – – (0.1) (0.1)
Amortisation charge – (5.3) (7.4) – (12.7)
Closing net book value 69.5 72.0 15.3 6.7 163.5
A
Att 11 AApprriill 22000066
Cost or valuation 69.5 80.0 42.3 6.7 198.5
Accumulated amortisation – (8.0) (27.0) – (35.0)
Net book value 69.5 72.0 15.3 6.7 163.5
YYeeaarr eennddeedd 3311 MMaarrcchh 22000077
Opening net book value 6
699..557722..001155..3366..77116633..55
Additions –
–––00..334466..224466..55
Transfers –
–––2255..99((2255..99))––
Disposals –
–––((00..11))((11..66))((11..77))
Amortisation charge –
–((55..33))((88..99))––((1144..22))
CClloossiinngg nneett bbooookk vvaalluuee6699..556666..773322..552255..44119944..11
A
Att 3311 MMaarrcchh 22000077
Cost or valuation 6
699..558800..005511..222255..44222266..11
Accumulated amortisation –
–((1133..33))((1188..77))––((3322..00))
NNeett bbooookk vvaalluuee6699..556666..773322..552255..44119944..11
Goodwill relates to the acquisition of ‘per una’, which was acquired in October 2004 and is not amortised, but tested annually for
impairment with the recoverable amount being determined from value in use calculations. The key assumptions for the value in use
calculations are those regarding the discount rate, growth rates and changes in income and costs.
The Group prepares discounted cash flow forecasts based on financial forecasts approved by management covering a three-year
period, which takes account of both past performance and expectations for future market developments. Cash flows beyond this
three-year period are extrapolated using a growth rate of 2.0%, which does not exceed the long-term average growth rate for retail
businesses in the UK. Management estimates the discount rate using a pre-tax rate that reflects current market assessments
of the time value of money and the risks specific to retail businesses. A pre-tax discount rate of 9.5% has been used.
Brands consist of the ‘per una’ brand which is being amortised on a straight-line basis over a period of 15 years.
wwwwww..mmaarrkkssaannddssppeenncceerr..ccoomm//aannnnuuaallrreeppoorrtt22000077MARKS AND SPENCER GROUP PLC 7755
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