Page 51 - Bouvet årsrapport ENG 2010 ePub

Recognised goodwill in the Group at 31.12.2010 constitutes NOK million 18,6. Tis is mainly related to the acquisition of Nordic Integrator Management AS (NOK million 15,3) that took place in 2007 and Bouvet Sverige AB (NOK million 2,8) taking place in 2008. After the aqcuisiton of Nordic Integrator Management AS the business has been itegrated into Bouvet’s business i Bergen, and the subsidi-ary does not represent a separate cash generating unit, but is measured together with cash fow from the Groups other business in Bergen. Bouvet Sverige is considered to be a separate cash generating units within the Group. All goodwill from these acquisitions are allocated to the respective cash generating unit.

Te impairment test was carried out by the Group itself in connection with the preparation of results for the fourth quarter.

Te recoverable amount amount is based on an assessment of the enterprise’s value in use. Te value in use is calculated based on a discount of expected future cash fows before tax, discounted with a relevant discount rate before tax considering term to maturity and risk.

Nordic Integrator Management AS/ Bouvet’s Bergen division – cash generating unit Te projection of cash fows is based on budget for the division i Bergen for the next fve years. Te cash fows are based on historic fgures for the division, and an expectation of moderate growth in the total market and prices on services is considered. In management’s opinion, it is a reasonable assumption, that it will continue to be a demand for such IT services. After the fve year period, a prudent estimate of 2% nominal growth in net cash fows is included.

Te interest rate applied for discounting cash fows is 10 percent before tax. Tis is based on a risk free interest rate of 3 percent, with an additional risk premium of 7 percent.

Bouvet Sverige AB – cash generating unit

Te projection of cash fows is based on budget value for the next fve years. Te cash fows are based on historic fgures for the Bouvet Sverige Group, where an expectation of moderate growth in the total market and prices on services is considered. In management’s opinion, this is a reasonable assumption, based on the synergy efects expected to be achieved in Bouvet Sverige as a result of being part of a larger group. After the fve year period, a prudent estimate of 2% nominal growth in net cash fows before tax is included.

Te interest rate applied for discounting cash fows is 10 percent before tax. Tis is based on a risk free interest rate of 3 percent, with an additional risk premium of 7 percent.

Sensitivity analysis of key assumptions Nordic Integrator Management AS

Nordic Integrator Management AS was acquired in 2007. In management’s view, this was a reasonably favourable purchase, and the value of the company at least exceeds the compensation of NOK million 21,3. Te value is, however, based on some key assumptions. In the event that these assumptions develop considerably diferently from expectations, this may imply a necessity to write down the good-will. If employees leave as a consequence of the acquisition, if there is no growth in services delivered to the bank and fnance sector or if Bergen as a geographic area experiences stagnation, the business area could be subject to write downs if other assumptions are constant.

Bouvet Sverige AB

Bouvet Sverige AB was acquired in 2008. In management’s view, this was a reasonably favourable purchase. Te value is, however, based on some key assumptions. In the event that these assumptions develop diferently from expectations, this may imply a necessity to write down the goodwill that has a total value of NOK million 2,8. If employees leave as a consequence of the acquisition, if there is no growth or development in the Swedish market, but on the contrary the unit experiences stagnation, the business area could be subject to write downs if other assumptions are constant.