(S) INTANGIBLES Research and development costs Royalty Assets Development Costs 65  NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2011 •  Useful Lives Finite. •  Amortisation method used Amortised over the period of expected future  benefit from the related project on a unit of  production basis. •  Internally generated or acquired Acquired. •  Impairment testing •  Useful Lives Finite. •  Amortisation method used •  Internally generated or acquired Internally generated. •  Impairment testing Amortised over the period of expected future  benefit from the related project on a straight-line  basis. Annually for assets not yet available for use  and more frequently when an indication of  impairment exists. The amortisation method is  reviewed at each financial period. Annually and more frequently when an  indication of impairment exists. The amortisation  method is reviewed at each financial period end. The carrying value of an asset arising from development expenditure is tested for impairment annually when the asset  is not yet available for use, or more frequently when an indication of impairment arises during the reporting period. A summary of policies applied to the Consolidated Entity’s intangible assets is as follows: Research costs are expensed as incurred. An asset arising from development expenditure on an internal project  is recognised only when the Consolidated Entity can demonstrate the technical feasibility of completing the  intangible asset so that it will be available for use or sale, or its intention to complete and its ability to use or sell  the asset, how the asset will generate future economic benefits, the availability of resources to complete the  development and the ability to measure reliably the expenditure attributable to the intangible asset during its  development. Following the initial recognition of the development expenditure, the cost model is applied requiring  the asset to be carried at cost less any accumulated amortisation and accumulated impairment losses. Any  expenditure so capitalised is amortised over the period of expected benefits from the related project.  Intangible assets with indefinite useful lives are tested for impairment annually either individually or at the  cash-generating unit level. Such intangibles are not amortised. The useful life of an intangible asset with an  indefinite life is reviewed each reporting period to determine whether indefinite life assessment continues to be  supportable. If not, the change in the useful life assessment from indefinite to finite is accounted for as a change  in an accounting estimate and is thus accounted for on a prospective basis. The useful lives of intangible assets are assessed to be either finite or indefinite. Intangible assets with finite lives  are amortised over the useful life and assessed for impairment whenever there is an indication that the intangible  asset may be impaired. The amortisation period and the amortisation method for an intangible asset with a finite  useful life is reviewed at least at each financial year-end. Changes in the expected useful life or the expected  pattern of consumption of future economic benefits embodied in the asset are accounted for by changing the  amortisation period or method, as appropriate, which is a change in accounting estimate. The amortisation  expense on intangible assets with finite lives is recognised in profit or loss in the expense category consistent  with the function of the intangible asset. Intangible assets acquired separately or in a business combination are initially measured at cost. The cost of  an intangible asset acquired in a business combination is its fair value as at the date of acquisition. Following  initial recognition, intangible assets are carried at cost less any accumulated amortisation and any accumulated  impairment losses. Internally generated assets, excluding capitalised development costs, are not capitalised and  expenditure is charged against profits or losses in the year the expenditure is incurred. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)