2007 Financial statements

Note 12 - Intangible assets

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Year ended 31 December 2007	Exploration and evaluation (a) US$m	Trademarks, patented and non patented technology US$m	Contract based intangible assets (b) US$m	Other intangible assets US$m	Total US$m
Net book value
At 1 January 2007	196	-	-	188	384
Adjustment on currency translation	9	12	7	22	50
Acquisition of subsidiary (note 41)	9	579	6,867	12	7,467
Expenditure during year	194	-	-	209	403
Amortisation for the year	-	(8)	(28)	(78)	(114)
Impairment	-	-	-	(21)	(21)
Disposals, transfers and other movements	(256)	-	(1)	(2)	(259)
At 31 December 2007	152	583	6,845	330	7,910
- cost	152	591	6,874	566	8,183
- accumulated amortisation	-	(8)	(29)	(236)	(273)

Year ended 31 December 2006	Exploration and evaluation (a) US$m	Trademarks, patented and non patented technology US$m	Contract based intangible assets (b) US$m	Other intangible assets US$m	Total US$m
Net book value
At 1 January 2006	113	-	-	107	220
Adjustment on currency translation	5	-	-	10	15
Expenditure during year	72	-	-	118	190
Amortisation for the year	-	-	-	(27)	(27)
Disposals, transfers and other movements	6	-	-	(20)	(14)
At 31 December 2006	196	-	-	188	384
- cost	196	-	-	310	506
- accumulated amortisation	-	-	-	(122)	(122)
At 1 January 2006
- cost	113	-	-	327	440
- accumulated amortisation	-	-	-	(220)	(220)

Notes	Expand
Exploration and evaluation: useful life not determined until transferred to property, plant & equipment. The Group acquired Alcan Inc. on 23 October 2007. Alcan Inc. benefits from certain intangible assets including power supply contracts, customer contracts and water rights. The water rights are expected to contribute to the efficiency and cost effectiveness of operations for the foreseeable future: accordingly, these rights are considered to have indefinite lives and are not subject to amortisation. These water rights constitute the majority of the amounts in the column of the above table entitled 'Contract based intangible assets'. The intangible assets with indefinite lives have been valued based on the advice of expert valuation consultants, and no diminution in their value is considered to have occurred since the date of acquisition. There are no intangible assets either pledged as security or held under restriction of title.

Exploration and evaluation expenditure

The charge for the year and the net amount of intangible assets capitalised during the year are as follows:

	2007 US$m	2006 US$m
Cash expenditure in year (net of proceeds on disposal of undeveloped properties) (a)	576	345
Changes in accruals (including non-cash proceeds on disposal of undeveloped properties)	(61)	(36)
Amount capitalised during year	(194)	(72)
Charge for year	321	237

Notes	Expand
Exploration and evaluation costs are stated net of gains on disposal of undeveloped properties totalling US$253 million (2006:US$46 million).

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