Key Audit Matter How the scope of our audit responded to the Key Audit Matter for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Note 9 outlines that impairment testing for property, plant and equipment will be performed if an impairment trigger is identified. The results of this testing in the current year identified impairment losses of $1,700 million in respect of goodwill, $3,663 million in respect of intellectual property (intangible assets with finite useful lives) and $1,664 million in respect of property, plant and equipment. The recoverable amount of the Group’s cashgenerating units (CGUs) and individual assets was determined by management using the ‘value in use’ approach, which incorporates significant judgement related to the estimation of future cash flows and selection of appropriate discount rates. Recoverable amounts are largely sensitive to forecast commercial assumptions including price, volumes and the timing and erosion rates from generic competition. The recoverable amounts of certain assets are also sensitive to forecast regulatory assumptions including regulator actions, pricing and reimbursement arrangements. As outlined in Note 4, impairments related to CSL Vifor give rise to a reduction in the carrying value of the investment in CSL Vifor for Swiss tax purposes. While the resulting impairment is eliminated on consolidation and does not impact the Group's consolidated carrying value of the investment, it gives rise to tax losses for Swiss tax purposes. A deferred tax asset of $853m has been recognised at 30 June 2026 based on management's assessment that sufficient future taxable profits will be available to utilise the resulting tax losses. A portion of the resulting Swiss tax losses ($298m) remains unrecognised and may be recognised in future periods should forecasts of future taxable profits support recoverability. Given the significant judgements required and the sensitivities associated with the forecast assumptions, together with the collective quantum of impairment charges and associated tax impacts, we consider the impairment of goodwill and non-current assets to be a Key Audit Matter. applied and testing the mathematical accuracy of the models. o Evaluating the discount rates applied by comparison to an independently developed range. • Assessing and challenging the key assumptions by: o Comparing them to Board-approved decisions, budgets and long-range plans. o Corroborating key current regulatory matters and market assumptions to external sources. o Corroborating key current or near-term commercial trends by comparing them to historical data. • Evaluating management’s assessment that sufficient future taxable profits will be available to utilise the tax losses recognised resulting from the impairment of the investment in CSL Vifor for Swiss tax purposes; • Performing a range of sensitivity analyses on key assumptions, including discount rates, forecast pricing, sales volume and erosion rates and forecast taxable profits. We have also evaluated the adequacy of the disclosures in Notes 3, 4, 8 and 9 of the financial statements. 139 CSL Limited Annual Report 2025/26
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