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10. Intangible assets continued 10.1 Goodwill continued Assumptions
The recoverable amounts attributed to all of the group’s CGUs are calculated on the basis of value–in–use using discounted cash flow models. On the basis that the recoverable amounts of these CGUs to which goodwill is allocated exceeds the net assets plus goodwill allocated, other than the impairment of E–Co Products the group has determined that no further impairment to goodwill has occurred during the period. Future cash flows are forecast based on actual results and business plans. For the electricity, gas distribution and metering CGUs, a ten–year period has been used due to the long–term nature of the group’s capital investment in these businesses and the predictable nature of their cash flows. A f ive–year period has been used for the natural gas, Liquigas, LPG, E–Co and communications CGUs. Terminal growth rates in a range of 0.0% to 2.0% (2019: 1.0% to 2.0%) and post–tax discount rates between 3.9% to 8.2% (2019: 4.7% and 8.9%) are applied. Rates vary for the specif ic CGU being valued. Projected cash flows for regulated businesses are sensitive to regulatory uncertainty. Estimated future regulated network revenues and the related supportable levels of capital expenditure are based on default price–quality path determinations issued by the Commerce Commission and are in line with estimates published in the asset management plans. Other intangible assets are initially measured at cost, and subsequently stated at cost less any accumulated amortisation and impairment losses. Software, customer intangibles, and trade names have been assessed as having a f inite life greater than 12 months and are amortised from the date the asset is ready for use on a straight–line basis over its estimated useful life. The estimated useful lives (years) are as follows: Software 3 – 10 Customer intangibles 3 – 10 Trade names 10 Easements are not amortised but are tested for impairment at least annually as part of the assessment of the carrying values of assets against the recoverable amounts of the CGUs to which they have been allocated.
10.2 Other intangible assets Policies
THE INTERPLAY OF TODAY AND TOMORROW
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