103 COnSOLIdATed FInAnCIAL STATeMenTS102 COnSOLIdATed FInAnCIAL STATeMenTS MONCLER GROUP 2023

2.4 NON-CURRENT ASSETS AVAILABLE FOR SALE AND DISCONTINUED OPERATIONS

non-current assets available for sale and discontinued operations are classified as available for sale when their values are recoverable mainly through a probable sale transaction. In such conditions, they are valued at the lower of their carrying value or fair value, net of cost to sell if their value is mainly recoverable through a sale trans- action instead of continued use.

discontinued operations are operations that: include a separate line of business or a different geographi-

cal area; are part of a single coordinated plan for the disposal of a sep-

arate major line of business or geographical area of activity; consist of subsidiaries acquired exclusively for the purpose

of being sold.

In the consolidated income statement, non-current assets held for sale and disposal groups that meet the requirements of IFRS 5 to be defined as discontinued operations , are presented in a single caption that includes both gains and losses, as well as losses or gains on disposal and the related tax effect. The comparative peri- od is subsequently restated in accordance with IFRS 5.

As far as the financial position is concerned, non-current as- sets held for sale and disposal groups that meet the requirements of IFRS 5 are reclassified as current assets and liabilities in the pe- riod in which such requirements arise. The comparative financial statements are not restated or reclassified.

2.5 PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment are stated at acquisition or manu- facturing cost, not revalued net of accumulated depreciation and impairment losses ( impairment ). Cost includes original purchase price and all costs directly attributable to bringing the asset to its working condition for its intended use.

dePReCIATIOn depreciation of property, plant and equipment is calculated and rec- ognised in the consolidated income statement on a straight-line ba- sis over the estimated useful lives as reported in the following table:

Category Depreciation period Land no depreciation Buildings From 25 to 33 years Plant and equipment From 8 to 12 years Fixtures and fittings From 5 to 10 years electronic machinery and equipment From 3 to 5 years Leasehold improvements Useful life of improvements Rights of use Lease period Other fixed assets depending on market conditions generally within the expected utility to the entity

Leased assets are depreciated over the shorter of the lease term and their useful lives unless it is reasonably certain that the Group will take ownership of the asset by the end of the lease term.

depreciation period is reviewed at each reporting period and adjusted if appropriate.

GAIn/LOSSeS On THe dISPOSAL OF PROPeRTY, PLAnT And eQUIPMenT Gains and losses on the disposal of property, plant and equipment represent the difference between the net proceeds and net book value at the date of sale. disposals are accounted when the rele- vant transaction becomes unconditional.

2.6 INTANGIBLE ASSETS

GOOdWILL Goodwill arising from business combination is initially recognised at the acquisition date as described in the notes related to Busi- ness combinations .

Goodwill is included within intangible assets with an indef- inite useful life, and therefore, is not amortised but subject to im- pairment test performed annually or more frequently if events or changes in circumstances indicate that the carrying value may not be recoverable. After the initial recognition, goodwill is measured at acquisition cost less accumulated impairment.

As part of the IFRS first time adoption, the Group chose not to apply IFRS 3 Business combinations retrospectively regard- ing acquisitions made prior to the transition date (1 January 2009); consequently, goodwill resulting from acquisitions prior to the tran- sition date to IFRS is still recorded under Italian GAAP, prior to any eventual impairment.

For further details please refer to note 2.7 Impairment of non-financial assets .

BRAndS Separately acquired brands are shown at historical cost. Brands acquired in a business combination are recognised at fair value at the acquisition date.

Brands have an indefinite useful life and are carried at cost less accumulated impairment. Brands are not amortised but sub- ject to impairment test performed annually or more frequently if events or changes in circumstances indicate that the carrying val- ue may not be recoverable.

For further details please refer to note 2.7 Impairment of non-financial assets .

InTAnGIBLe ASSeTS OTHeR THAn GOOdWILL And BRAndS License rights are capitalised as intangible asset and amortised on a straight-line basis over their useful economic life. The useful eco- nomic life of license rights is determined on a case-by-case basis, in accordance with the terms of the underlying agreement.

Key money are capitalised in connection with the opening of new directly operated store ( dOS ) based on the amount paid. Key money in general have a definite useful life which is generally in line with the lease period. However, in certain circumstances, key mon- ey have an indefinite useful life on the basis of legal protection or common practice that can be found in jurisdictions or markets that state that a refund could be received at the end of the lease period. In these limited cases, that need to be adequately supported, key money are not amortised but subject to impairment test at least an- nually in accordance with what set out in the note related to impair- ment of non-financial assets.

Software (including licenses and separately identifiable ex- ternal development costs) is capitalised as intangible assets at purchase price, plus any directly attributable cost of preparing that asset for its intended use. Software and other intangible assets that are acquired by the Group and have definite useful lives are mea- sured at cost less accumulated amortisation and accumulated im- pairment losses.

AMORTISATIOn OF InTAnGIBLe ASSeTS WITH A deFInITe USeFUL LIFe Intangible assets with a definite useful life are amortised on a straight line basis over their estimated useful lives as described in the following table:

Category Depreciation period License rights Based on market conditions within the licence period or legal limits to use the asset Key money Based on market conditions generally within the lease period Software From 3 to 5 years Order backlog Based on fulfillment of the order backlog identified in PPA Other intangible assets Based on market conditions generally within the period of control over the asset