At the end of each financial year, assets are reviewed in order to determine if there are any impairment indicators.
It is considered that intangible assets and property, plant and equipment are impaired if as a result of technological changes, plans of liquidation, abandonment or other premises indicating decrease in usefulness of a given asset, the value of expected economic benefits related to intangible assets or property, plant and equipment has fallen.
When such indicators have been identified, an impairment test for a given asset is carried out to determine its recoverable amount. If necessary, an impairment loss is recognised to the recoverable amount. If an asset does not generate cash flows which to a large extent are independent of cash flows generated by other assets, the analysis is carried out for the smallest identifiable group of cash-generating assets which the asset belongs to. Impairment losses are recognised in the consolidated statement of profit or loss account under “Other operating expenses”.
If there are premises indicating that the impairment losses recognised in previous periods are no longer required and the loss should be decreased, the recoverable value of such an asset is calculated. An impairment loss recognized in the previous periods is reversed to the recoverable value not exceeding the carrying amount that would have been determined (having deducted the depreciation), had the impairment loss not been recognized previously. A reversal of impairment loss is disclosed as as income in the consolidated statement of profit or loss under “Other operating expenses”.