BMW 2009 Annual Report Download - page 88

86
74 Group Financial Statements
74 Income Statements
74 Statement of
Comprehensive Income
76 Balance Sheets
78 Cash Flow Statements
80 Group Statement of Changes
in Equity
81 Notes
81 Accounting Principles
and Policies
90 Notes to the Income
Statement
97
Notes to the Statement
of Comprehensive Income
98 Notes to the Balance Sheet
119 Other Disclosures
133 Segment Information
The recoverability of the carrying amount of intangible as-
sets (including capitalised development costs and good-
will) and property, plant and equipment is tested regularly
for impairment in accordance with IAS 36 (Impairment of
Assets) on the basis of cash generating units. This relates
primarily to capitalised development costs and property,
plant and equipment connected with vehicle projects. If
there is no indication of impairment during the year, an an-
nual impairment test is carried out at the year-end. An im-
pairment loss is recognised when the recoverable amount
(defined as the higher of the asset’s net selling price and
its value in use) is lower than the carrying amount. The
value in use is determined on the basis of a present value
computation. If the reason for the previously recognised
impairment loss no longer exists, the impairment loss is
reversed up to the level of its rolled-forward depreciated or
amortised cost.
Investments accounted for using the equity method are
measured at the Group’s share of equity taking account
of fair value adjustments on acquisition unless the invest-
ment is impaired.
Investments in non-consolidated group subsidiaries re-
ported
in other investments are measured at cost or, if
lower, at their fair value.
Participations are measured at their quoted market price
or fair value. When, in individual cases, these values are not
available or cannot be determined reliably, participations
are measured at cost.
Non-current marketable securities are measured accord-
ing to the category of financial asset to which they are
classified. No held-for-trading financial assets are included
under this heading.
Financial assets are accounted for on the basis of the
settlement date. On initial recognition, they are measured
at acquisition cost, including transaction costs.
Subsequent to initial recognition, available-for-sale and
held-for-trading financial assets are measured at fair value.
When market prices are not available, the fair value of
available-for-sale financial assets is measured using appro-
priate
valuation techniques e. g. discounted cash flow
analysis based on market information available at the bal-
ance sheet date.
Available-for-sale assets include financial assets, securities
and investment fund shares. This category includes all
non-derivative financial assets which are not classified as
“loans and receivables” or “held-to-maturity investments”
or as items measured “at fair value through profit and loss”.
Loans and receivables which are not held for trading, held-
to-maturity financial investments and all financial assets
for which published price quotations in an active market
are not available and whose fair value cannot be determined
reliably, are measured, to the extent that they have a fixed
term, at amortised cost, using the effective interest method.
When the financial assets do not have a fixed term, they
are measured at acquisition cost.
In accordance with IAS 39 (Financial Instruments: Recog-
nition and Measurement), assessments are made regularly
as to whether there is any objective evidence that a finan-
cial asset or group of assets may be impaired. Impairment
losses identified after carrying out an impairment test are
recognised as an expense. Gains and losses on available-
for-sale financial assets are recognised directly in equity
until the financial asset is disposed of or is determined to
be impaired, at which time the cumulative loss previously
recognised in equity is included in net profit or loss for the
period.
With the exception of derivative financial instruments, all
receivables and other current assets relate to loans and
receivables which are not held for trading and they are
measured at amortised cost. Receivables with maturities
of over one year which bear no or a lower-than-market in-
terest rate are discounted. Appropriate impairment losses
are recognised to take account of all identifiable risks.
Receivables from sales financing comprise receivables from
retail customer, dealer and lease financing.
Impairment losses on receivables relating to financial
services business are recognised using a uniform meth-
odology that is applied throughout the Group and meets
the requirements of IAS 39. This methodology results in
the recognition of impairment losses on individual assets
and groups of assets. If there is objective evidence of im-
pairment, the BMW Group recognises impairment losses
on the basis of individual assets. Within the retail cus-
tomer business, the existence of overdue balances or the
incidence of similar events in the past are examples of