FGV Annual Report 2012

62 Felda Global Ventures Holdings Berhad 20 INTANGIBLE ASSETS (continued) Company Software RM’000 2012 At 1 January 2012 – Additions 6,217 Amortisation charge (468) At 31 December 2012 5,749 Expected remaining useful lives (years) – 31 December 2012 5 (a) Impairment test for goodwill Goodwill is allocated to the Group’s cash-generating units (CGU) as follows: Group 2012 2011 RM’000 RM’000 Sugar business operations in Seberang Prai, Malaysia 576,240 576,240 (i) Sugar business operations in Seberang Prai, Malaysia The goodwill relates to the acquisition of the sugar business by the Group and is allocated to Malayan Sugar Manufacturing Company Berhad. This represents the lowest level at which goodwill is monitored for internal management purposes. The recoverable amount of the CGU is determined based on a value in use calculation using cash flows projections based on financial budgets approved by the Directors covering a three-year period and applying a terminal value growth rate multiple using longer-term sustainable growth rates. The key assumptions used for the CGU’s value in use calculation are: 2012 2011 Gross margin 20% – 22% 13% Terminal value growth rate 2% 4% Discount rate 9% 9% Notes to the Financial Statements for the financial year ended 31 December 2012