153 / 204
Rothschild & Co | Annual Report 2017
151
1. Overview
4. Financial statements
3.
Management report
2. Business review
Testing for impairment
As at 31 December 2017, the Group performed an annual impairment test for each of the CGUs to which goodwill has been allocated. The recoverable
amount of the CGU was calculated using the most appropriate method.
For our RGA business, the fair value less cost of disposal has been calculated using PE multiples which have been applied to the normalised profit after
tax. The value was determined using parameters derived from market conditions and based on data from comparable companies. The valuation technique
would be classified in Level 2 of the fair value hierarchy.
The following assumptions were used:
• normalised profit after tax is determined over a three-year period; and
• trading multiples used were PE multiples of long-term M&A-focused peers.
Results of sensitivity tests on the RGA business show that a 10% decrease in either the PE multiples or in the normalised profit after tax would reduce the
value of the CGU by €200 million and would not result in an impairment.
Note 11 – Due to banks and other financial institutions
In thousands of euro
31/12/2017 31/03/2017
Interbank demand deposits and overnight
261,312
108,022
Interbank term deposits and borrowings
370,145
347,567
Accrued interest
4,920
5,369
TOTAL
636,377
460,958
Note 12 – Customer deposits
In thousands of euro
31/12/2017 31/03/2017
Demand deposits
7,085,767 7,416,913
Term deposits
604,680
576,180
Borrowings secured by bills
79,143
68,403
Accrued interest
1,364
1,787
TOTAL
7,770,954 8,063,283
Note 13 – Other liabilities, accruals and deferred income
In thousands of euro
31/12/2017 31/03/2017
Due to employees
485,443
528,232
Other accrued expenses and deferred income
195,532
158,410
Accrued expenses
680,975
686,642
Settlement accounts for transactions of securities
(1)
128,893
99,983
Accounts payable
(1)
21,207
30,628
Sundry creditors
118,302
139,197
Other liabilities
268,402
269,808
TOTAL
949,377
956,450
(1) These balances represent other financial liabilities as reported in section IV.