Notes for P&L

All amounts in SEKm unless otherwise stated.

Note 14 Intangible non-current assets 

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2011/2012
Intangible assets acquired Intangible assets developed in the Group
Group Goodwill Supplier relationships, customer relationships and technology Trademarks Capitalised R&D expenses Leases (rental) and similar rights Software Software Total
Accumulated cost
Opening balance 463.1 406.6 21.9 8.9 0.2 46.9 3.7 951.3
Acquisition of companies 138.3 127.0 1.0 266.3
Investments 0.8 0.7 4.5 6.0
Change in additional consideration -0.4 -0.4
Reclassifications 0.2 0.2
Translation effect for the year -0.5 -0.4 0.0 -0.1 -1.0
Closing balance 600.5 533.2 22.9 9.9 0.9 51.3 3.7 1,222.4
Accumulated amortisation
Opening balance -111.7 -0.1 -6.6 0.0 -37.3 -2.8 -158.5
Amortisation -45.5 0.0 -1.2 -0.1 -5.1 -0.7 -52.6
Translation effect for the year 0.4 0.0 0.1 0.5
Closing balance -156.8 -0.1 -7.8 -0.1 -42.3 -3.5 -210.6
Carrying amount at year-end 600.5 376.4 22.8 2.1 0.8 9.0 0.2 1,011.8
Carrying amount at start of year 463.1 294.9 21.8 2.3 0.2 9.6 0.9 792.8

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2010/2011
Intangible assets acquired Intangible assets developed in the Group
Group Goodwill Supplier relationships, customer relationships and technology Trademarks Capitalised R&D expenses Leases (rental) and similar rights Software Software Total
Accumulated cost
Opening balance 318.8 288.8 9.5 8.6 0.2 44.0 3.7 673.6
Acquisition of companies 156.1 126.2 12.4 0.2 294.9
Investments 0.6 3.3 3.9
Change in additional consideration -3.6 -3.6
Reclassifications -0.3 0.2 -0.1
Translation effect for the year -8.2 -8.4 0.0 -0.8 -17.4
Closing balance 463.1 406.6 21.9 8.9 0.2 46.9 3.7 951.3
Accumulated amortisation
Opening balance -79.9 -0.1 -5.6 0.0 -32.4 -2.1 -120.1
Amortisation -34.4 0.0 -1.0 -5.5 -0.7 -41.6
Translation effect for the year 2.6 0.6 3.2
Closing balance -111.7 -0.1 -6.6 0.0 -37.3 -2.8 -158.5
Carrying amount at year-end 463.1 294.9 21.8 2.3 0.2 9.6 0.9 792.8
Carrying amount at start of year 318.8 208.9 9.4 3.0 0.2 11.6 1.6 553.5

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2011/2012 2010/2011
Parent Company Software Total Software Total
Accumulated cost
Opening balance 2.6 2.6 2.2 2.2
Investments 0.4 0.4
Retirement of assets
Closing balance 2.6 2.6 2.6 2.6
Accumulated amortisation
Opening balance -1.4 -1.4 -0.9 -0.9
Amortisation -0.5 -0.5 -0.5 -0.5
Retirement of assets
Closing balance -1.9 -1.9 -1.4 -1.4
Carrying amount at year-end 0.7 0.7 1.2 1.2
Carrying amount at start of year 1.2 1.2 1.3 1.3
Group
Goodwill distributed by business area 31 Mar 12 31 Mar 11
Addtech Components 108 77
Addtech Energy & Equipment 153 91
Addtech Industrial Solutions 136 138
Addtech Life Science 204 157
Total 601 463
Pro forma according to new organisation per 1 April 2012
Group
Goodwill distributed by business area 31 Mar 12 31 Mar 11
Addtech Components 173 143
Addtech Energy 174 52
Addtech Industrial Solutions 50 111
Addtech Life Science 204 157
Total 601 463

Impairment testing of goodwill

The Group's recognised goodwill amounts to SEK 601 million (463). Having adopted IFRS, the Company no longer amortises goodwill but rather tests goodwill annually in accordance with IAS 36. The latest test took place in March 2012.

The Group has carried out over 60 acquisitions since 2001. Goodwill in each individual acquisition is not material for the Group. Goodwill is therefore allocated among cash-generating units, which usually correspond to the business units. Impairment testing takes place at business unit level, because the acquired business is also integrated with another Addtech business to such an extent that it is not possible to separate assets and cash flows attributable to the acquired company. Goodwill is not assessed at a higher level than segment level.

The recoverable amount was calculated based on value in use and applies a current estimate of cash flows for the coming five-year period. Assumptions were made concerning gross margin, overhead costs, working capital required and investments required based on previous experiences. As the norm, these parameters were set to correspond to the profit forecast for the next financial year 2012/2013. An annual growth rate of 2 percent (2) was assumed for the remainder of the five-year period. Where major changes are expected, the parameters were adjusted to better reflect such expectations. For cash flows beyond the five-year period, the growth rate was assumed to correspond to growth during the fifth year. Cash flows were discounted using a weighted cost of capital corresponding to roughly 12 percent (12) before tax. These calculations show that value in use significantly exceeds the carrying amount. Consequently, impairment testing indicated no impairment. The sensitivity of these calculations means that the value of goodwill will continue to be justified even if the discount rate increases by 1 percentage point or if the long-term growth rate decreases by 1 percentage point. 

Other impairment testing

Each year, trademarks are tested for impairment applying the same policies as with goodwill. No events or changes in circumstances were identified that would motivate impairment testing for other intangible non-current assets that are amortised.