13. Intangible assets

Accounting policy

Goodwill

All business combinations are accounted for using the acquisition method. Goodwill is the amount deriving from the acquisition of subsidiaries, associates and joint ventures. Goodwill is the difference between the cost of the acquisition and the fair value of the acquired identifiable assets and liabilities at the acquisition date. Goodwill is measured at cost less accumulated impairment.

Negative goodwill arising from an acquisition is taken directly to the income statement.

Other intangible assets

Other intangible assets with a limited useful life acquired or produced by the Group are recognised at cost less accumulated amortisation and accumulated impairment losses.

After initial recognition, expenditure on capitalised intangible assets is only capitalised if it leads to an increase in the future economic benefits embodied in the specific asset involved. All other expenditure, including internally generated goodwill and trademarks, is charged to the income statement when it occurs.

Amortisation is charged to the income statement on a straight-line basis over the estimated useful lives of the intangible assets, with the exception of goodwill, from the date on which they become available for use. The estimated useful lives are as follows:

• Software 3 - 10 years

• Contracts 5 - 10 years