Cloudberry Clean Energy Annual report 2020

Cloudberry Annual report 2020 Financial statements 106 An equity return of 6.5% and a long-term borrowing rate of 3% p.a. was used as input in the 31.12.2020 impairment test. The impairment test did not cause any write downs of the carrying amount as per 31 December. The recoverable amount is sensitive to the discount rate as well as for the expected cash flows from operations derived from long term power prices and currency. Goodwill For Goodwill, the related segment is defined as the relevant segment CGU. The table shows the allocation of the total goodwill acquired in business combinations for impairment testing purposes, including to which segment the goodwill relates and the carrying value at 31 December. NOK 1 000 2020 2019 Goodwill Production - - Goodwill Develop 36 933 - Total 36 933 - The goodwill origins from the acquisition of Scanergy AS in February 2020. The goodwill was determined to be related to the large pipeline of project prospects within wind on land and shallow water, the know- how and business connections (employees), the record of accomplishments over the past 10 years for the company acquired, as well as synergies. The purpose of the acquisition was to acquire a large development portfolio with projects within both hydro and wind in the Nordics, and within the categories with construction permits, backlog and pipeline, as well as the competence within develop- ment projects. The model for impairment testing goodwill from the Develop segment is the same model as for impairment testing projects. The model is sensitive to inputs such as the expected fair value of ready to build projects, the expected timing of realisation and the applied discount rate. The impairment test did not cause any impairment loss as per 31 December. The applied WACC is 8%, and an increase of 1% point in WACC would not cause a need for recognition of impairment loss. For information about the acquisition see note 5 Business Combinations.