67
FLEXIGROUP LIMITED FINANCIAL REPORT 2011
15. Non-current assets – Deferred tax assets
Consolidated
2011
2010
$’000
$’000
The balance comprises temporary diferences attributable to:
Amounts recognised in proft or loss
Doubtful debts
3,789
3,530
Employee entitlements
2,499
2,148
Provisions
1,851
2,242
IPO expenses
–
507
Capital raising costs
280
374
Total deferred tax assets
8,419
8,801
Movements
Opening balance at 1 July
8,801
7,356
Credited/(charged) to the income statement
(382)
978
Capital raising costs credited directly to equity
–
467
Closing balance at 30 June
8,419
8,801
Deferred tax assets to be recovered within 12 months
6,159
6,400
Deferred tax assets to be recovered after more than 12 months
2,260
2,401
8,419
8,801
16. Non-current assets – Goodwill
Consolidated
2011
2010
$’000
$’000
Goodwill
Goodwill has been allocated to the following CGUs
Leases
50,159
50,159
Interest-free loans
29,717
29,717
Total goodwill at 30 June
79,876
79,876
The Group is required to test the balance of goodwill annually for impairment. Impairment would arise if the recoverable
amount of the goodwill were lower than its carrying amount. The recoverable amount of the goodwill for this purpose is
the higher of its value in use or its fair value. Currently the Group performs this assessment based on fair value calculations.
The Group refers to the share price of the Company as traded on the Australian Securities Exchange to assess the fair value
calculation. Based on recent trading in the Group’s shares, no impairment arises.
The recoverable amount of each CGU is determined based on the future cash fow projection discounted by the Group’s
after tax return on equity rate of 15% (2010: 15%) adjusted to a pre-tax rate. All future cash fows are based on approved
two (2010: two) year budgets. Whilst the budget assumes certain economic conditions , the forecast is not reliant on one
particular assumption. These business forecasts applied by management are considered appropriate as they are based
on past experience and are consistent with observable current market information. The growth rates after 2012 are assumed
to be zero for all CGUs for the purpose of goodwill impairment testing.