Our Future Note 7: Research and Development The Group conducts research and development activities to support future development of products to serve our patient communities, to enhance our existing products and to develop new therapies. All costs associated with our research and development activities are expensed as incurred as uncertainty exists up until the point of regulatory approval as to whether a research and development project will be successful. Development costs incurred after regulatory approval are expensed unless it meets the criteria to be recognised as an intangible asset. For the year ended 30 June 2025, research and development costs recognised in the statement of comprehensive income were $1,359m (2024: $1,430m). Note 8: Intangible Assets Goodwill Intellectual property Software Intangible work in progress Total US$m US$m US$m US$m US$m Year 2025 2024 2025 2024 2025 2024 2025 2024 2025 2024 Cost 8,065 8,079 8,775 8,465 1,006 924 76 120 17,922 17,588 Accumulated amortisation — — (1,028) (650) (709) (592) — — (1,737) (1,242) Net carrying amount 8,065 8,079 7,747 7,815 297 332 76 120 16,185 16,346 Net carrying amount at beginning of year 8,079 8,079 7,815 7,821 332 353 120 193 16,346 16,446 Additions — — 292 298 7 10 25 10 324 318 Transfers — — — — 63 83 (70) (82) (7) 1 Transfers to held for sale (Note 2) — — — (6) — — — — — (6) Disposals (14) — — — (1) (4) — — (15) (4) Amortisation for the year — — (364) (301) (104) (109) — — (468) (410) Currency translation differences — — 4 3 — (1) 1 (1) 5 1 Net carrying amount at end of year 8,065 8,079 7,747 7,815 297 332 76 120 16,185 16,346 Goodwill Any excess of the fair value of the purchase consideration of an acquired business over the fair value of the identifiable net assets is recorded as goodwill. Goodwill is initially allocated to a group of cash-generating units but is monitored at the segment (business unit) level. Goodwill is not amortised but is measured at cost less any accumulated impairment losses. Impairment occurs when a business unit’s recoverable amount falls below the carrying value of its net assets. The results of the impairment testing show that each business unit’s recoverable amount exceeds the carrying value of its net assets, inclusive of goodwill. Consequently, there is no goodwill impairment as at 30 June 2025 (2024: Nil). A change in assumptions significant enough to lead to impairment is not considered a reasonable possibility. Disposals during the year ended 30 June 2025 relates to goodwill attributable to the Ruide cash-generating unit (Note 2). The aggregate carrying amounts of goodwill by segment are as follows: 2025 2024 US$m US$m CSL Behring 5,454 5,468 CSL Seqirus 911 911 CSL Vifor 1,700 1,700 Closing balance of goodwill as at 30 June 8,065 8,079 Intellectual property Intellectual property (IP) acquired in a business combination is initially measured at fair value. Intellectual property internally developed or acquired separately is initially measured at cost. Following initial recognition, it is carried at cost less any accumulated amortisation and impairment. Amortisation is calculated on a unit-of-production or diminishing balance basis over periods generally ranging from 5 to 30 years, except where it is considered that the useful economic life is indefinite. 106 Notes to the Financial Statements 106 Financial Report
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