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Note 14. Non-current assets - intangibles

Goodwill - at cost Consolidated 2014
Other intangible assets 2015 $’000
$’000
10,095 10,095

8,505 8,512

18,600 18,607

Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set
out below:

Balance at 1 July 2013 Goodwill Brand Other Total
Additions through business combinations $’000 valuation $’000 $’000
Balance at 30 June 2014 10,095 10,095
Disposals $’000 -
Balance at 30 June 2015 - 8,512
- 7
10,095 18,607
8,505 7
- (7)
8,505 (7)
10,095 18,600
- -

8,505

Goodwill
Determining whether goodwill is impaired requires an estimation of the value-in-use of the cash-generating units
(CGUs) to which goodwill has been allocated. These calculations reflect estimated cash flow projections based on a
five year forecast and require the use of assumptions, including estimated discount rates; growth rates of estimated
future cash flows; and terminal growth rates.

The value-in-use method applied in determining the recoverable amount of the CGUs is affected by management’s
assumptions used in the calculation.

The five year cash flow forecast is based on a budget that has been approved by the Board and projected for a
further four years based on an estimated growth rate of 2.5% (2014: 2.5%). The growth rate has been determined
with reference to industry trends. As part of the annual impairment test for goodwill, management assesses the
reasonableness of growth rate assumptions by reviewing historical cash flow projections against actual cash flows.

The discount rates used in the value-in-use calculations are pre-tax and reflect management’s estimate of the time
value of money, as well as the risks specific to the CGUs. The discount rates have been determined using the average
weighted cost of capital and the current market risk-free rate, adjusted for relevant business risks. Pre-tax discount
rate applied in the current year value-in-use model: 11.7% (2014: 11.7%).

A terminal growth rate of 2.0% (2014: 2.0%) has been assumed in the value-in-use calculation and reflects the long-
term growth expectations beyond the five year forecast horizon.

There has been no impairment loss recognised relation to goodwill (2014: nil).

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