Intangible assets (Tables)

12 Months Ended

Dec. 31, 2018


All figures in £ millions	Goodwill			Software			Acquired customer lists, contracts and relationships			Acquired trademarks and brands			Acquired publishing rights			Other intangibles acquired			Total
Cost
At 1 January 2017		2,341			798			974			353			211			600			5,277
Exchange differences		(148	)		(46	)		(74	)		(26	)		(6	)		(50	)		(350	)
Additions – internal development		—			133			—			—			—			—			133
Additions – purchased		—			17			—			—			—			—			17
Disposals		—			(23	)		—			—			—			—			(23	)
Disposal through business disposal		—			(4	)		(9	)		(19	)		—			(27	)		(59	)
Transfer from property, plant and equipment		—			11			—			—			—			—			11
Transfer to assets classified as held for sale		(163	)		(4	)		(2	)		(27	)		(21	)		(34	)		(251	)

At 31 December 2017		2,030			882			889			281			184			489			4,755
Exchange differences		74			32			39			(2	)		—			1			144
Additions – internal development		—			124			—			—			—			—			124
Additions – purchased		—			6			—			—			—			—			6
Disposals		—			(94	)		(18	)		(12	)		—			(33	)		(157	)
Disposal through business disposal		—			(2	)		—			—			—			—			(2	)
Transfer from property, plant and equipment		—			11			—			—			—			—			11
Transfer from assets classified as held for sale		7			—			—			—			—			—			7

At 31 December 2018		2,111			959			910			267			184			457			4,888

Amortisation
At 1 January 2017		—			(461	)		(555	)		(209	)		(198	)		(412	)		(1,835	)
Exchange differences		—			30			43			13			4			36			126
Charge for the year		—			(85	)		(77	)		(18	)		(3	)		(40	)		(223	)
Disposals		—			21			—			—			—			—			21
Disposal through business disposal		—			2			8			18			—			22			50
Transfer to assets classified as held for sale		—			—			1			16			19			34			70

At 31 December 2017		—			(493	)		(580	)		(180	)		(178	)		(360	)		(1,791	)
Exchange differences		—			(23	)		(26	)		1			2			(10	)		(56	)
Charge for the year		—			(88	)		(59	)		(14	)		(2	)		(24	)		(187	)
Disposals		—			92			18			12			—			33			155
Disposal through business disposal		—			—			—			—			—			—			—

At 31 December 2018		—			(512	)		(647	)		(181	)		(178	)		(361	)		(1,879	)

Carrying amounts
At 1 January 2017		2,341			337			419			144			13			188			3,442
At 31 December 2017		2,030			389			309			101			6			129			2,964

At 31 December 2018		2,111			447			263			86			6			96			3,009

Summary of Useful Economic Life of Intangible Assets

The range of useful economic lives for each major class of intangible asset (excluding goodwill and software) is shown below:


	2018
Class of intangible asset	Useful economic life
Acquired customer lists, contracts and relationships		3-20 years
Acquired trademarks and brands		2-20 years
Acquired publishing rights		5-20 years
Other intangibles acquired		2-20 years

Summary of Amortisation Profile of Intangible Assets

The expected amortisation profile of acquired intangible assets is shown below:


	2018
All figures in £ millions	One to five years		Six to ten years		More than ten years		Total
Class of intangible asset
Acquired customer lists, contracts and relationships		187		66		10		263
Acquired trademarks and brands		49		27		10		86
Acquired publishing rights		5		1		—		6
Other intangibles acquired		77		19		—		96

Summary of Carrying Value of Goodwill

The carrying value of the goodwill in each of the CGUs is summarised below:


All figures in £ millions	2018		2017
North America		930		1,013
Core		701		641
Growth (includes Brazil, China, India and South Africa)		—		—
Pearson VUE		480		376

Total		2,111		2,030

Summary of Cumulative Impact of Changes in Assumptions Used in Calculating the Fair Value

The table below shows the headroom at 31 December 2018 and the cumulative impact of changes in the assumptions used in calculating the fair value.


All figures in £ millions	Headroom at 31 December 2018		1% increase in average discount rate			5% decrease in annual contribution		10% decrease in annual contribution			1% decrease in perpetuity growth rate
Headroom/(impairment)
North America		356		128			27		(301	)		167
Core		210		67			84		(42	)		83
Brazil		20		(8	)		3		(14	)		(4	)