Volkswagen Group - Annual Report 2008

CHANGES IN INTANGIBLE ASSETS BETWEEN JANUARY 1 AND DECEMBER 31, 2007
€ million	Concessions, industrial and similar rights, and licenses in such rights and assets	Goodwill	Capitalized costs for products under development	Capitalized development costs for products currently in use	Other intangible assets	Total
Cost Balance at Jan. 1, 2007	63	195	1,872	10,146	1,286	13,562
Foreign exchange differences	–3	6	7	–65	–12	–67
Changes in consolidated Group	–	5	–	–	2	7
Additions	5	–	1,135	311	193	1,644
Transfers	3	–	–1,042	1,042	22	25
Disposals	1	5	34	964	121	1,125
Balance at Dec. 31, 2007	67	201	1,938	10,470	1,370	14,046
Amortization and impairment Balance at Jan. 1, 2007	57	–	113	5,405	794	6,369
Foreign exchange differences	–2	–	–	–37	–6	–45
Changes in consolidated Group	–	–	–	–	2	2
Additions to cumulative amortization	7	–	–	1,428	154	1,589
Additions to cumulative impairment losses	–	5	175	240	3	423
Transfers	0	–	–18	18	1	1
Disposals	1	5	41	957	119	1,123
Balance at Dec. 31, 2007	61	–	229	6,097	829	7,216
Carrying amount at Dec. 31, 2007	6	201	1,709	4,373	541	6,830

Sensitivity analyses have shown that it is unnecessary to recognize impairment losses on goodwill and indefinite-lived intangible assets, including where realistic variations are applied to key assumptions.

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CHANGES IN INTANGIBLE ASSETS BETWEEN JANUARY 1 AND DECEMBER 31, 2008
€ million	Concessions, industrial and similar rights, and licenses in such rights and assets	Goodwill	Capitalized costs for products under development	Capitalized development costs for products currently in use	Other intangible assets	Total
Cost Balance at Jan. 1, 2008	67	201	1,938	10,470	1,370	14,046
Foreign exchange differences	3	–384	–54	–366	–232	–1,033
Changes in consolidated Group	–	2,952	12	1,073	1,740	5,777
Additions	6	2	1,842	374	233	2,457
Transfers	14	–	–1,036	1,036	–29	–15
Held for sale	–	–	34	65	6	105
Disposals	1	–	3	1,023	117	1,144
Balance at Dec. 31, 2008	89	2,771	2,665	11,499	2,959	19,983
Amortization and impairment Balance at Jan. 1, 2008	61	–	229	6,097	829	7,216
Foreign exchange differences	3	–	–	–130	–14	–141
Changes in consolidated Group	–	–	–	–	0	0
Additions to cumulative amortization	7	–	–	1,359	374	1,740
Additions to cumulative impairment losses	0	–	18	15	8	41
Transfers	7	–	–8	8	–8	–1
Held for sale	–	–	–	20	6	26
Disposals	1	–	0	1,021	115	1,137
Balance at Dec. 31, 2008	77	–	239	6,308	1,068	7,692
Carrying amount at Dec. 31, 2008	12	2,771	2,426	5,191	1,891	12,291

€2,574 million of the goodwill reported as of December 31, 2008 relates to Scania and €151 million to Škoda (translated at the closing rate). The goodwill attributable to both companies is allocated to the Automotive Division. €32 million of the remaining amount relates to the Automotive Division and €14 million to the Financial Services Division. The recoverability of recognized goodwill is not affected by a variation in the growth forecast or in the discount rate by +/–0.5%.

Other intangible assets in the Automotive Division at the balance sheet date include Scania’s brand name with a carrying amount of €895 million. This figure is not amortized because no useful life can be determined.

Of the total research and development costs incurred in 2008, €2,216 million (previous year: €1,446 million) met the criteria for capitalization under IFRS s.

The following amounts were recognized as expenses:

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€ million	2008	2007
Research and non-capitalized development costs	3,710	3,477
Amortization of development costs	1,392	1,843
Research and development costs recognized in the income statement	5,102	5,320

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12 Intangible assets

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