99 ANNUAL REPORT 2010 earned on the contract. The expected surplus interest is  calculated with reference to a portfolio of government bonds.  The rebate can be subject to additional conditions concerning  actual returns or the continuation of the policy for a specified  number of years. margins. For products sold in the United States and Canada  with amortization based on expected gross profit margins, the  amortization period and pattern are reviewed at each reporting  date and any change in estimates is recognized in the income  statement. Estimates include, but are not limited to: an  economic perspective in terms of future returns on bond and  equity instruments, mortality, disability and lapse assumptions,  maintenance expenses and expected inflation rates. For all  products, DPAC, in conjunction with VOBA where appropriate,  is assessed for recoverability at least annually on a country-by- country basis and is considered in the liability adequacy test for  each reporting period. If appropriate, the assumptions included  in the determination of estimated gross profits are adjusted.  The portion of DPAC that is determined not to be recoverable  is charged to the income statement. Interest rebates that are expected to be recovered in future  periods are deferred and amortized as the surplus interest is  realized. They are considered in the liability adequacy test for  insurance liabilities. Other assets include trade and other receivables, prepaid  expenses, real estate held for own use and equipment. Trade  and other receivables are initially recognized at fair value and  are subsequently measured at amortized cost. Equipment is  initially carried at cost, depreciated on a straight line basis over  its useful life to its residual value and is subject to impairment  testing. The accounting for real estate held for own use is  described in note 2.8. For products sold in the United States or Canada, when  unrealized gains or losses arise on available-for-sale assets,  DPAC is adjusted to equal the effect that the realization of the  gains or losses (through sale or impairment) would have had  on its measurement. This is recognized directly in the related  revaluation reserve in shareholders’ equity. Cash comprises cash at banks and in-hand. Cash equivalents  are short-term, highly liquid investments with original  maturities of three months or less that are readily convertible  to known cash amounts, are subject to insignificant risks of  changes in value and are held for the purpose of meeting  short-term cash requirements. Money market investments that  are held for investment purposes (backing insurance liabilities,  investment liabilities or equity based on asset liability  management considerations) are not included in cash and  cash equivalents but are presented as investment or investment  for account of policyholders.  DPAC is derecognized when the related contracts are settled  or disposed of. Deferred transaction costs relate to investment contracts  without discretionary participation features under which  AEGON will render investment management services.  Incremental costs that are directly attributable to securing  these investment management contracts are recognized as  an asset if they can be identified separately and measured  reliably and if it is probable that they will be recovered.  For contracts involving both the origination of a financial  liability and the provision of investment management services,  only the transaction costs allocated to the servicing component  are deferred. The other transaction costs are included in the  carrying amount of the financial liability.  The deferred transaction costs are amortized in line with fee  income, unless there is evidence that another method better  represents the provision of services under the contract.  Deferred transaction costs are subject to impairment testing  at least annually.  An asset is impaired if the carrying amount exceeds the amount  that would be recovered through its use or sale. For tangible  and intangible assets, financial assets and reinsurance assets,  if not held at fair value through profit or loss, the recoverable  amount of the asset is estimated when there are indications  that the asset may be impaired. Irrespective of the indications,  goodwill and other intangible assets with an indefinite useful  life that are not amortized, are tested at least annually.  Assets are tested individually for impairment when there are  indications that the asset may be impaired. The impairment  loss is calculated as the difference between the carrying and  the recoverable amount of the asset, which is the higher of an  asset’s value in use and its net selling price. The value in use  represents the discounted future net cash flows from the  An interest rebate is a form of profit sharing whereby the Group  gives a discount on the premium payable (usually single  premium) based on the expected surplus interest that will be  SHARPENING OUR FOCUS NOTE 2.16 IMPAIRMENT OF ASSETS A. IMPAIRMENT OF NON-FINANCIAL ASSETS C. DEFERRED INTEREST REBATES B. DEFERRED TRANSACTION COSTS NOTE 2.15 CASH AND CASH EQUIVALENTS NOTE 2.14 OTHER ASSETS AND RECEIVABLES