11 Intangibles

Intangibles

  License   Goodwill   Total
2017 AED’000

AED’000   AED’000
Carrying value:          
At 1 January 1,044   6,705   7,749
Amortisation charges during the year (783)     (783)
At 31 December
261
 
6,705
 
6,966
2016
Carrying value:
At 1 January 1,827   6,705   8,533
Amortisation charges during the year (783) (783)
At 31 December
1,044
6,705
7,750


License

License represents the amount paid by the Group to acquire an existing investment banking license issued by the Central Bank of UAE.

Goodwill

Goodwill acquired through business combinations relates to Islamic Finance House P.J.S.C.

Impairment test of goodwill

The Group performs impairment testing of the goodwill annually on 31 December.

Goodwill has been allocated to the subsidiary as a cash-generating unit.  This represents the lowest level within the Group at which the goodwill is monitored for internal management purposes.

During the year, the Group has performed a goodwill impairment review based on a forecast of the subsidiary’s cash flows.  The recoverable amount of the cash-generating unit was estimated on the basis of its value in use, which is determined by discounting future cash flows from the continuing operation of the cash generating unit. The discount rate applied to the cash flow projections is 12% and the growth rate used to extrapolate the cash flows beyond the five-year period is 3%. Based on the results of the goodwill impairment assessment the Group has concluded that the recoverable amount of the cash-generating unit is higher than its carrying value.