INTANGIBLE ASSETS Intangible assets represent identifiable non-monetary assets without physical substance and are acquired either separately through a business combination, or generated internally. Intangible assets with a finite useful life are recorded at cost less any accumulated amortization and impairment losses. Certain intangible assets, such as trademarks and trade names, have an indefinite useful life. These indefinite life intangibles are not amortized but are tested for impairment at least annually. The assets’ useful lives are assessed at least annually.
Amortization of acquisition-related intangible assets with finite useful lives is reported in other expenses and amortization of internally generated software is included in premises and equipment expenses on the consolidated statements of income and recorded on a straight-line basis from the date at which it is available for use as follows:
• Software and related assets: 3 to 15 years • Customer relationships: 10 to 15 years • Non-competition agreements: 4 to 5 years • Other: 3 to 5 years
Software and Related Assets
Non- competition Agreements
Trademarks and Tradenames
Customer Relationships
Other
Total
Cost Balance at November 1, 2022
325,855 $
90,442 $
8,785 $
11,084 $
5,150 $
441,316 54,595 (14,930) 480,981
$
Additions Disposals
54,595 (6,544) 373,906
- -
-
-
- -
(3,050)
(5,336)
Balance at October 31, 2023
90,442
5,735
5,748
5,150
Accumulated Amortization Balance at November 1, 2022
142,537 28,831
56,524
2,100
11,084
5,150
217,395 37,321 (14,930) 239,786
Amortization
7,540
950
-
- -
Disposals
(6,544)
-
(3,050)
(5,336)
Balance at October 31, 2023
164,824
64,064
-
5,748
5,150
Net Carrying Amount at October 31, 2023
$
209,082 $
26,378 $
5,735 $
- $
- $
241,195
Software and Related Assets
Non- competition Agreements
Trademarks and Tradenames
Customer Relationships
Other
Total
Cost Balance at November 1, 2021
295,778 $
90,442 $
8,785 $
11,084 $
5,150 $
411,239 52,588 (22,511)
$
Additions Disposals
52,588
- -
- -
- -
- -
(22,511)
Balance at October 31, 2022
325,855
90,442
8,785
11,084
5,150
441,316
Accumulated Amortization Balance at November 1, 2021
118,764 46,284 (22,511) 142,537
48,396
-
11,084
5,150
183,394 56,512 (22,511) 217,395
Amortization
8,128
2,100
- -
- -
Disposals
-
-
Balance at October 31, 2022
56,524
2,100
11,084
5,150
Net Carrying Amount at October 31, 2022
$
183,318 $
33,918 $
6,685 $
- $
- $
223,921
IMPAIRMENT The carrying amounts of our intangible assets with finite useful lives are reviewed at each reporting date to determine whether there is any indication of impairment. If an indication exists, we test for impairment. Goodwill and intangible assets with indefinite useful lives are tested for impairment annually or more frequently if events or changes in circumstances indicate impairment. Impairment testing is performed by comparing an asset’s carrying amount with its recoverable amount. Where it is not possi ble to estimate the recoverable amount of an individual asset, the recoverable amount of the CGU to which the asset belongs will be determined and compared to the carryin g amount of the CGU’s net assets, including attributable goodwill. Goodwill is tested for impairment at the level of a CGU or a group of CGUs. If the recoverable amount is less than the carrying value, an impairment loss is charged to the consolidated statements of income. The recoverable amounts for our CGUs are calculated based on the higher of their value in use and fair value less costs of disposal. Value in use is determined by discounting the future cash flows expected to be generated from the continuing use of the CGU. Fair value less costs of disposal is the amount obtainable from the sale of a CGU in an orderly transaction between market participants, less disposal costs. The fair value of a CGU is estimated using valuation techniques such as a discounted cash flow method or market-based approaches where the fair value of a CGU is determined using comparable market transactions for similar businesses.
In the 2023 and 2022 annual impairment tests, the recoverable amounts of our CGUs are based on their value in use with the exception of the WM CGU, which is based on fair value less costs of disposal.
CWB Financial Group 2023 Annual Report | 85
Powered by FlippingBook