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The trademark is amortised on a straight-line basis over its useful life, which is estimated to
be 20 years.
With regard to the licence, based on an analysis of all the relevant factors, the Company
considers that there is no foreseeable limit to the period over which it is expected to generate
net cash inflows for the Company. As a result, the licence was classified as an intangible asset
with an indefinite useful life and, therefore, it is not amortised. This indefinite useful life
assessment is reviewed at each reporting date and is consistent with the Company's related
business plans.
The Company has reviewed the licence and trademark valuations identified in the purchase
price allocation process performed within the framework of the aforementioned merger. For
this review, which included the participation of an independent expert, the standard
procedures for analyses of this kind were used, and it was concluded that the assigned values
are within reasonable valuation ranges. Consequently, it was not necessary to modify the
initial estimates or make any adjustments at 2014 year-end.
Since the asset has an indefinite useful life, a recoverability assessment was performed at
year-end. The key assumptions on which the cash flow projections are based relate mainly to
advertising markets, audience, advertising efficiency ratios and the evolution of expenses.
Except for advertising data, which is measured on the basis of external sources of information,
the assumptions are based on past experience and reasonable projections approved by
Company management and updated in accordance with the performance of the advertising
markets.
Taking the correlation between the advertising market and the evolution of domestic demand
and private consumption as a reference, a retrospective analysis was conducted using the
historical data of these two variables, based on market consensus.
These future projections cover the next five years. The discount rate used to measure this
intangible asset was between 9% and 10%.
A variation of 0.5% in cumulative annual growth would give rise to a change in value of EUR
18 million, while a 0.5% increase in the discount rate would give rise to a change of EUR 22
million, and a 0.5% decrease in the discount rate would result in a change of EUR 25 million.
Zero perpetual growth was used.
Computer software
The Company recognises under “Computer Software” the costs incurred in the acquisition and
development of computer programs, including website development costs. Computer software
maintenance costs are recognised with a charge to the income statement for the year in which
they are incurred. Computer software is amortised on a straight-line basis over three to five
years.
4.2 Property, plant and equipment
Property, plant and equipment are initially recognised at acquisition or production cost and are
subsequently reduced by the related accumulated depreciation and by any impairment losses
recognised, as indicated in this note.
Property, plant and equipment upkeep and maintenance expenses are recognised in the
income statement for the year in which they are incurred. However, the costs of
improvements leading to increased capacity or efficiency or to a lengthening of the useful lives
of the assets are capitalised.