ANNUAL REPORT 2011 - DONG Energy

DKK million Land and
Impairment testing
DONG Energy tests property, plant and equipment for impairment
if there is any indication of impairment.
In an impairment test, the asset’s recoverable amount is
compared with its carrying amount. An impairment loss is
recognised whenever the carrying amount of an asset or its
cash-generating unit (CGU) exceeds its recoverable amount.
The recoverable amount of property, plant and equipment
is the higher of the assets’ fair value less expected disposal
costs and the present value of the expected future net cash
fl ows (value in use).
production assets
Oil and gas fi elds
Producing oil and gas fi elds in the Exploration & Production
segment were tested for impairment in 2011. Based on the
impairment testing of oil and gas-producing fi elds, it was estimated
that the recoverable amount exceeded the carrying
buildings
Production
assets
Exploration
assets
Fixtures and
ttings, tools and
equipment
Property, plant and
equipment under
construction
Cost at 1 January 2010 3,482 74,257 2,997 473 13,043 94,252
Foreign exchange adjustments 2 1,426 49 - 433 1,910
Additions 20 2,840 386 12 13,046 16,304
Disposals (27) (744) (100) (13) (196) (1,080)
Transfers to assets classi ed as held for sale (4) (1,046) - (1) (1) (1,052)
Transfers 6 9,516 (2,357) 11 (7,176) 0
Reclassi cations 28 - - - 12 40
Cost at 31 December 2010 3,507 86,249 975 482 19,161 110,374
Depreciation and impairment losses
at 1 January 2010 (469) (23,430) - (206) (17) (24,122)
Foreign exchange adjustments - (324) - (1) - (325)
Depreciation, disposals 11 171 - 13 - 195
Depreciation charge (141) (5,111) - (84) - (5,336)
Impairment charge (23) (294) - - - (317)
Transfers to assets classi ed as held for sale 2 241 1 - 244
Reclassi cations (28) - - - - (28)
Depreciation and impairment losses
at 31 December 2010 (648) (28,747) 0 (277) (17) (29,689)
Carrying amount at 31 December 2010 2,859 57,502 975 205 19,144 80,685
Total
amount, and no impairment losses were therefore recognised on
the Group’s producing oil and gas fi elds in 2011.
The main criteria used for determining the recoverable amount
are the expectations concerning reserves, oil and gas prices,
exchange rates and discount rates.
Electricity distribution network
The electricity distribution network was tested for impairment
in 2011. The electricity distribution network is recognised in the
Sales & Distribution segment.
Based on the impairment testing of the electricity distribution
network, it is estimated that the recoverable amount exceeds
the carrying amount. No impairment loss was consequently recognised
on the Group’s electricity distribution network in 2011.
The main criteria in connection with the determination of the
recoverable amount are the regulatorily permitted return, discount
rates, expected volume of transported kWh, operation and
maintenance as well as the associated investment level.
DONG ENERGY DONG ENERGY GROUP ANNUAL REPORT 2011 – COnsOliDatED finanCial statEmEnts
89 93
notes