Notes to the Financial Statements
Capitalised software impairment At each reporting period the internally generated software is assessed for any impairment triggers. If any such indication exists, the recoverable amount of the asset is estimated. The impairment indicators for software intangibles are defined as: • The ability of the software to provide the functionality required from the business to use the asset; • The software is being utilised for the purposes that it was designed; • The availability of alternative software that the business has available; and • Product mix – the Group no longer sells the products that are administered on the PAS or utilises the provided functionality. As a result of the Wealth Management divestment, the front end wealth portal of $2.9 million recognised within the Wealth Management CGU’s has been impaired since 31 December 2023 and the impairment is part of the the disposal group. See section 8.5 for detail. As at 30 June 2024, no impairment was required to the carrying value of capitalised software.
The estimated embedded value of the business has been calculated based on the following key assumptions and estimates: • Mortality and morbidity (claims) • Investment returns and discount rates; • Persistency (lapse); • Premium rate and pricing changes (if applicable); • Outflows; • Maintenance costs; and • Discount rates. The embedded value uses assumptions that are consistent with those adopted for contract liabilities in this financial report. A risk free rate of 4% has been adopted for the purposes of the embedded value calculations at 30 June 2024 (30 June 2023: 4.0%) with a range of discount range margins of 3%, 4% and 5% above the risk free rate. See section 5.2 for actuarial estimates and assumptions that has been taken into accounting in setting these assumptions. For sensitivities on the EV calculations and their potential impacts on the carrying value of the Goodwill and impairment triggers, please refer to the EV section of the Operating and Financial Review. As at 30 June 2024, no impairment was required to the carrying value of goodwill within the Life Insurance CGU.
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ClearView Annual Report 2024
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