RCS GROUP CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 31 December 2015
Insurance premiums received or receivable from the insurer
are recognised in the income statement when incurred.
Claims incurred and reported are recognised in the income
statement when the loss events occur. Claims incurred but not
yet reported are estimated for compensation payable to the
insured and are recognised in the income statement.
Amount receivable from insurer
The amount receivable from the insurer is initially recognised at
the amount paid for the ordinary shares issued by the insurer.
The amount receivable from the insurer represents the right
to the residual interest in the cell captive and is after initial
recognition measured based on the net asset position of the
cell captive at the end of the reporting period. This amount is
reduced by dividends declared by the insurer.
The amount receivable from the insurer is assessed for
impairment at each reporting period. If there is objective
evidence that the amount receivable is impaired, the carrying
amount of the reinsurance asset is reduced to its recoverable
amount. The impairment loss is recognised in the income
losses. Goodwill is allocated to cash-generating units and is
not amortised, but tested annually for impairment and when
there is an indication of impairment.
1.10 Intangible Assets
Intangible assets that are acquired by the Group, which have
finite useful lives, are measured at cost less accumulated
amortisation and accumulated impairment losses.
Subsequent expenditure is capitalised only when it increases
the future economic benefits embodied in the specific asset to
which it relates. All other expenditure, including expenditure
on internally generated goodwill and brands, is recognised in
the income statement as incurred.
Expenditure on research activities is recognised as an
expense in the period in which it is incurred. An internally-
generated intangible asset arising from development (or from
the development phase of an internal project) is recognised if,
and only if, all of the following have been demonstrated:
• the intention to complete the intangible asset and use or sell it;
• the ability to use or sell the intangible asset;
• how the intangible asset will generate probable future
• the availability of adequate technical, financial and
other resources to complete the development and to use
or sell the intangible asset;
• the ability to measure reliably the expenditure attributable
to the intangible asset during its development; and
• the technical feasibility of completing the intangible asset.
The amount initially recognised for internally-generated
intangible assets is the sum of the expenditure incurred
from the date when the intangible asset first meets the
recognition criteria listed above. Where no internally-
generated intangible asset can be recognised, development
expenditure is recognised in the income statement in
the period in which it is incurred. Subsequent to initial
recognition, internally-generated intangible assets are
reported at cost less accumulated amortisation and
accumulated impairment losses, on the same basis as
intangible assets acquired separately.
Client lists acquired by the RCS Group are stated at historical
cost less accumulated amortisation and impairment losses.