Boskalis Annual Report 2018

82

82

matrix that is adjusted if necessary for specific forward-looking information about the receivables and the economic environment. The Group applies the simplified method to determine its loss allowance for current trade receivables and unbilled revenue. In the event that objective evidence for impairment of a joint venture or an associate exists, the Group determines the recoverable amount. An impairment charge is measured by comparing the recoverable amount of the investment with the carrying amount. An impairment charge is recognized in the Statement of Profit or Loss and is reversed if there has been a favorable change in the estimates used to determine the recoverable amount. 3.6 INTANGIBLE ASSETS Goodwill arises upon acquiring group companies and joint operations and is calculated as the difference between the acquisition price and the fair value of the assets acquired and liabilities assumed, according to the accounting principles of the Company. Goodwill is allocated to the relevant cash- generating unit. These cash-generating units represent the lowest level within the Group at which goodwill is monitored for internal management purposes and not exceeding the level of the Group’s operational segments. Goodwill and other Amortization of trademarks valued at acquisition takes place over 10 years, while the amortization of customer portfolios and contracts valued at acquisition takes place over the remaining useful life (at acquisition date, determined to be between 7 and 22 years). Methods for determining amortization and useful life are reassessed at the end of each financial year and amended if necessary. intangible assets are presented net of accumulated amortization and accumulated impairment charges. Goodwill and intangible assets with an indefinite useful life are not amortized, but are tested for impairment every year or in case of an indication of impairment (see note 3.5). In respect of joint ventures and associates, the carrying amount of goodwill is included in the carrying amount of the investment. Other intangible assets acquired in a business combination are capitalized only when it is probable that future economic benefits embodied in an asset, will flow to the Group and the cost of the asset can be reliably measured. Other intangible assets with a finite useful life are stated at cost less accumulated amortization and accumulated impairment charges. Expenditure on research activities, undertaken with the prospect of gaining new scientific or technical knowledge and understanding, is expensed as incurred. 3.7 PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment are stated at cost less accumulated depreciation calculated from the date of commissioning and accumulated impairment charges. The cost price is based on the purchase price and/or the internally generated cost based on directly attributable expenses. The depreciation, taking into account an assumed residual value,

is calculated over the estimated remaining useful lives assigned to the various categories of assets. Modifications and capacity enhancing investments are also capitalized at cost and amortized over the remaining life of the asset. Property, plant and equipment under construction are included in the Statement of Financial Position on the basis of installments paid, including interest during construction. In the event that property, plant and equipment consists of components with different useful lives, such components are accounted for as separate items. Buildings are depreciated over periods ranging from 10 to 30 years. The depreciation periods for components of the majority of the floating and other construction materials range from 5 to 30 years. Furniture and other fixed assets are depreciated over a period between 3 and 10 years. Land is not depreciated. The wear of dredging equipment is highly dependent on unpredictable project-specific combinations of soil conditions, material to be processed, maritime circumstances, and the intensity of the deployment of the equipment. As a result of these erratic and time-independent patterns, the maintenance and repair expenses to keep the assets in their operational condition are charged to the Statement of Profit or Loss. Methods for determining depreciation, useful life and residual value are reassessed at the end of each financial year and amended if necessary. Leases in terms of which the Group assumes substantially all the risks and rewards of ownership are classified as finance leases. Upon initial recognition, the leased asset is classified as a tangible fixed asset and is measured at an amount equal to the lower of its fair value and the present value of the minimum lease payments. Subsequent to initial recognition, the asset is accounted for in accordance with the accounting policy applicable to that asset. Other leases are operating leases which are not recognized in the Group’s consolidated statement of financial position and are disclosed as part of the other commitments and contingent liabilities. 3.8 JOINT VENTURES AND ASSOCIATES Joint ventures and associates are initially recognized at cost including the goodwill determined at acquisition date. Subsequently joint ventures and associates are accounted for using the equity method, adjusted for differences with the accounting principles of the Group, less any accumulated impairment charges. If the Group’s share of losses exceeds the carrying amount of the joint venture or associate, the carrying amount is reduced to zero and the recognition of further losses is discontinued except to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the joint venture or associate. Joint ventures and associates also include the amounts invested by the Group in joint ventures and associates by means of interest-bearing loans.

ANNUAL REPORT 2018 – BOSKALIS FINANCIAL STATEMENTS 2018 AN UAL REP RT 2018 -- BOSKALIS FINANCIAL STATEMENTS 2018