IBERSOL | Annual Report 2020

ANNUAL REPORT 2020 2.4 GOODWILL Goodwill represents the excess of the acquisition cost over the fair value of the iden- tifiable assets and liabilities attributable to the Group at the date of the acquisition or the first consolidation. If the acquisition cost is less than the fair value of the acquired subsidiary’s net assets, the difference is recognized directly in the income statement. The Group performs impairment tests on Goodwill on an annual basis or more fre- quently, if events or changes in circumstances indicate a potential impairment. The recognized amount of Goodwill is compared with the recoverable amount, which is the higher of the value in use and the fair value less costs to sell. Whenever the book value of Goodwill exceeds its recoverable value, the impairment is immediately recog- nized as an expense and is not subsequently reversed (note 2.9). 2.5 REPORT BY SEGMENTS The Group presents the operating segments based on the management information produced internally. In accordance with IFRS 8, an operating segment is a component of the Group: (i) that develops business activities fromwhich it can earn revenue and incur expenses; (ii) whose operating results are regularly reviewed by the chief operating decision maker of the Group (“chief operating decision maker”) for the purposes of making decisions on the allocation of resources to the segment and the assessment of its performance; and (iii) for which separate financial information is available. The group operates in three major segments of activity: - Restaurants, which integrates the units offering catering for table service and home delivery; - Counters, which comprises units for sale over the counter; - Concessions and catering, which encompasses all other businesses, namely cater- ing activities and units located in spaces under concession. The segment assets mainly include property, plant and equipment, intangible assets, inventories, accounts receivable and cash and cash equivalents. Deferred taxes, finan- cial investments and derivatives held for trading or designated as collateral for loans are excluded. The segment liabilities correspond to operating liabilities. It does not include elements such as income taxes (current and deferred), loans and related hedging derivatives. Investments include additions to property, plant and equipment (Note 8) and intangi- ble assets (Note 9). Investments are allocated, in terms of segments, according to this type of business. 319