Annual report - HSE

Emission coupons are not amortised, since they are purchased for individual periods in
which they are used. Emission coupons received from the government are initially valuated
at EUR 1 per coupon at simultaneous increase in long-term deferred revenue.
Goodwill appears in consolidation and represents a surplus of cost over the company’s
share in fair value of acquired recognisable assets, liabilities and contingent liabilities of the
subsidiary on the date of acquisition. Goodwill is recognised as an asset and is examined
at least once per year due to impairment. Each impairment is immediately recognised in
the consolidated income statement and is not subsequently reversed. In case of disposal
of subsidiary, the adequate amount of goodwill is included in the establishment of profit/
loss in sales and effect on the Group’s profit or loss.
Amortisation is accounted for on a straight-line basis, taking into account the useful life of
each individual (integral) part of an intangible asset. The amortisation is measured at cost
when an asset is available for use.
Individual items of intangible assets have the following useful lives:
Intangible assets Amortisation rate (%) Useful life in years
Computer software 5-50% 2-20
Licences 10-50% 2-10
Concession rights 2% 50
Other long-term property rights 2-25% 4-50
Other intangible assets 10-25% 4-10
Useful life of groups of intangible assets are examined at the end of each financial year
and adapted, if needed. In the event their useful life is extended, the cost of amortisation
in the current year is decreased. If useful life is shortened, amortisation cost increases. The
adjustment of useful life has to be calculated in a manner that the asset will be amortised
in the new predicted useful life. The change in useful life is considered as a change in
accounting estimate and it affects solely the period in which the accounting estimate was
changed and every following period of the remaining useful life.
Subsequent costs in relation to intangible assets are capitalised only in cases when they
increase future economic benefits arising from an asset to which the costs refer. All other
costs are recognised in profit or loss as expenses as soon as they are incurred.
On disposal, intangible assets are eliminated from the books of account, and the difference
between the net sales value and the carrying amount of a disposed intangible asset is
transferred to other sales revenue or write-downs.
5.5.7.3 Property, plant and equipment
Property, plant and equipment are long-term assets owned by the Group companies and
used for the performance of their activities.
Property, plant and equipment comprise land, buildings, production equipment, other
equipment and assets in the course of construction.
Property, plant and equipment (fixed assets) are carried at cost, less accumulated
depreciation and losses from impairment. Cost includes costs that can be directly attributed
to the acquisition of an item of property, plant and equipment. Cost includes borrowing
costs related to the acquisition of a fixed asset until it is in working condition. The cost does
not include costs incurred upon the dismantling or renovation of fixed assets.
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Annual Report HSE 2012
174
The parts of items of plant and equipment with different useful lives are accounted for
as individual assets. Spare parts of higher value are recorded as fixed assets and are
depreciated over the useful life of the related asset.