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Intangible assets and goodwill | 12 Months Ended
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Dec. 31, 2021
Intangible assets and goodwill |
| 12 | Intangible assets and goodwill
Schedule of intangible assets
| Goodwill | Licenses with indefinite useful life | Trademarks | Customer relationships | Software | Education content | Developed technology | Educational platform | Software in progress | Total
Cost |  |  |  |  |  |  |  |  |  |
As of January 1, 2019 | 169,535 | 445,616 | - | 63,303 | 8,288 | - | - | 577 | 1,175 | 688,494
Additions (i) (ii) | 4,030 | 108,000 | - | - | 1,101 | - | - | 8,769 | 875 | 122,775
Business combinations | 285,844 | 150,156 | 32,111 | 62,110 | - | 17,305 | - | 2,845 | - | 550,371
As of December 31, 2019 | 459,409 | 703,772 | 32,111 | 125,413 | 9,389 | 17,305 | - | 12,191 | 2,050 | 1,361,640
Additions | - | - | - | - | 4,175 | - | - | 15,227 | 247 | 19,649
Disposals | - | - | - | - | (460) | - | - | - | - | (460)
Business combinations | 351,247 | 747,498 | 42,903 | 158,126 | 3,117 | - | 355 | 484 | - | 1,303,730
As of December 31, 2020 | 810,656 | 1,451,270 | 75,014 | 283,539 | 16,221 | 17,305 | 355 | 27,902 | 2,297 | 2,684,559
Additions (iii) | - | 108,000 | - | 684 | 3,044 | - | 996 | 39,686 | 23,700 | 176,110
Disposals * | - | - | - | - | 1,020 | - | - | (2,743) | (417) | (2,140)
Business combinations | 373,680 | 606,136 | 58,355 | 147,054 | 1,474 | - | 33,046 | 11,599 | 3,267 | 1,234,611
As of December 31, 2021 | 1,184,336 | 2,165,406 | 133,369 | 431,277 | 21,759 | 17,305 | 34,397 | 76,444 | 28,847 | 4,093,140
Amortization |  |  |  |  |  |  |  |  |  |
As of January 1, 2019 | - | - | - | (2,945) | (3,080) | - | - | - | - | (6,025)
Amortization | - | - | (1,150) | (34,927) | (1,456) | (4,876) | - | (868) | - | (43,277)
As of December 31, 2019 | - | - | (1,150) | (37,872) | (4,536) | (4,876) | - | (868) | - | (49,302)
Amortization | - | - | (2,352) | (47,960) | (2,180) | (2,816) | (32) | (7,367) | - | (62,707)
Disposals | - | - | - | - | 460 | - | - | - | - | 460
As of December 31, 2020 | - | - | (3,502) | (85,832) | (6,256) | (7,692) | (32) | (8,235) | - | (111,549)
Amortization | - | - | (5,027) | (56,438) | (5,844) | (8,980) | (625) | (3,608) | - | (80,522)
Disposals | - | - | - | - | (599) | - | - | 365 | - | (234)
As of December 31, 2021 | - | - | (8,529) | (142,270) | (12,699) | (16,672) | (657) | (11,478) | - | (192,305)
Net book value |  |  |  |  |  |  |  |  |  |
As of December 31, 2021 | 1,184,336 | 2,165,406 | 124,840 | 289,007 | 9,060 | 633 | 33,740 | 64,966 | 28,847 | 3,900,835
As of December 31, 2020 | 810,656 | 1,451,270 | 71,512 | 197,707 | 9,965 | 9,613 | 323 | 19,667 | 2,297 | 2,573,010
* |  | the Company performed physical inventory procedures in some of the subsidiaries for the year ended December 31, 2021 and the final adjustments (R$103 of costs net of depreciation) were recorded as disposals above.
(i) |  | The amount of R$4,030 added to goodwill relates to adjustments during the measurement period of the business combination of IESP in respect to amounts to be included as part of the purchase price allocation at acquisition date mainly related to impairment of receivables.
(ii) |  | On August 13, 2019, Afya Brazil entered into a purchase agreement with the shareholders of IPEC for the acquisition of 100% of IPEC. IPEC was a non-operational postsecondary education institution with governmental authorization to offer on-campus post-secondary undergraduate courses in medicine in the State of Pará, that started its operation in September 2019. . Management assessed the aspects of such transaction and concluded that the transaction does not fall under the definition of business, but an acquisition of license with indefinite useful life recognized in intangible assets Prior to the acquisition date, IPEC had no significant assets and liabilities. The purchase price of R$ 108,000 is comprised of: i) R$ 54,000 paid in cash on the acquisition date; ii) R$ 54,000 is payable in two equal instalments of R$ 27,000 payable annually from August 13, 2020 to August 13, 2021, and adjusted by the CDI rate.
(iii) |  | On November 05, 2021 Secretary of Regulation and Supervision of Higher Education of the Ministry of Education ("MEC") authorized the operation of 120 medical school seats in Garanhuns, for which our shareholder Nicolau Carvalho Esteves entered into an agreement with Afya Brazil pursuant to which he assigned to Afya Brazil the right to develop the ITPAC Garanhuns greenfield unit, a medical school in the city of Garanhuns, State of Pernambuco. Management assessed the aspects of such transaction and concluded that the transaction does not fall under the definition of business, but an acquisition of license with indefinite useful life recognized in intangible assets. Total purchase price was R$108,000 of which 50% was paid in cash on the transaction closing date and 50% in two equal annual installments, adjusted by the CDI rate.
Licenses with indefinite useful life include intangible assets acquired through business combinations. The licenses for medicine and other courses granted by the Ministry of Education (“MEC”) to the companies acquired have no expiration date and the Company has determined that these assets have indefinite useful lives. For impairment testing goodwill and licenses with indefinite useful lives acquired through business combinations are allocated to CGUs. The Company performed its annual impairment test on December 31, 2021, 2020 and 2019. The Company tests at least annually the recoverability of the carrying amount of goodwill and licenses with indefinite useful lives for each CGU. The process of estimating these values involves the use of assumptions, judgments and estimates of future cash flows that represent the Company's best estimate. There was no impairment for goodwill and licenses with indefinite useful lives as of December 31, 2021, 2020 and 2019. The carrying amounts of goodwill and licenses with indefinite useful life by CGU and their carrying amount as of December 31, 2021 and 2020 was: Schedule of assumptions for impairment test
| Carrying amount
CGU | Goodwill |  | Licenses with indefinite useful life |  | CGU
| 2021 |  | 2020 |  | 2021 |  | 2020 |  | 2021 |  | 2020
IPTAN | 17,446 |  | 17,446 |  | 57,214 |  | 57,214 |  | 140,522 |  | 126,397
IESVAP | 27,956 |  | 27,956 |  | 81,366 |  | 81,366 |  | 112,260 |  | 112,898
CCSI | 4,664 |  | 4,664 |  | 56,737 |  | 56,737 |  | 49,030 |  | 48,411
IESP | 73,838 |  | 73,838 |  | 179,693 |  | 179,693 |  | 346,286 |  | 380,410
FADEP | 49,661 |  | 49,661 |  | 70,606 |  | 70,606 |  | 153,791 |  | 160,787
Medcel and CBBW* | 139,294 |  | 139,294 |  | - |  | - |  | 235,300 |  | 219,359
FASA | 58,903 |  | 58,903 |  | 144,507 |  | 144,507 |  | 302,330 |  | 267,279
IPEMED | 87,647 |  | 87,647 |  | - |  | - |  | 126,965 |  | 119,227
IPEC | - |  | - |  | 108,000 |  | 108,000 |  | 131,360 |  | 122,325
UniRedentor | 77,662 |  | 77,662 |  | 121,477 |  | 121,477 |  | 246,320 |  | 253,370
UniSL | 4,420 |  | 4,420 |  | 249,387 |  | 249,387 |  | 305,044 |  | 258,234
FESAR | 71,664 |  | 71,664 |  | 141,616 |  | 141,616 |  | 279,038 |  | 263,914
FCMPB | 110,483 |  | 110,483 |  | 235,018 |  | 235,018 |  | 401,244 |  | 380,682
Practice Management Tools & Electronic Prescription | 113,362 |  | - |  | - |  | - |  | 227,909 |  | -
Clinical Decision Software | 87,018 |  | 87,018 |  | - |  | - |  | 147,592 |  | 149,805
Medical Harbour | 4,022 |  | - |  | - |  | - |  | 9,150 |  | -
Moc | 87,777 |  | - |  | 184,597 |  | 5,649 |  | 356,789 |  | 7,230
Unigranrio | 130,073 |  | - |  | 421,538 |  | - |  | 630,185 |  | -
RXPRO | 38,446 |  | - |  | - |  | - |  | 46,788 |  | -
* |  | CBBW as merged by Medcel on May 1, 2020.
The main assumptions used by the Company to determine the value in use of the CGUs were: Student enrollment – refer to the number of students that are currently enrolled in each CGU. Tuition fees – is the monthly fee charged to students. Occupancy rate – the occupancy rate of the medical schools is the ratio of the number of students effectively enrolled divided by the regulatory capacity in a given period. Regulatory capacity – the regulatory capacity is defined by the number of medical schools seats available per year awarded by MEC, multiplied by the number of years of operations since the seats were awarded. Faculty – refer to the cost with faculty in the CGU, which means the amount paid to teachers and doctors. Digital content platform users – refer to mobile app subscription, clinical management system, healthcare payments, medical imaging, online courses for digital content users and marketing for pharmaceutical industry. Capital expenditure – refers to investments to be made on intangible assets related to developments and platform improvements especially on the digital services CGUs. Discount rates - discount rates represent the current market assessment of the risks specific to the CGU being tested. The pre-tax discount rate applied to cash flow projections is 12.10% in 2021 (13.00% in 2020). Significant estimate: impact of possible changes in key assumptions An increase of 25 basis points in management’s estimated discount rate applied to the cash flow projections of each CGU for the year ended December 31, 2021, or a decrease of 25 basis points on estimated EBITDA would have not resulted in significant impacts on these financial statements. Other intangible assets Intangible assets, other than goodwill and licenses with indefinite useful lives, are valued separately for each acquisition and are amortized during each useful life. The useful lives and methods of amortization of other intangibles are reviewed at each financial year end and adjusted prospectively, if appropriate. The estimated useful lives of intangible assets are as follows: Schedule of estimated useful lives
Customer relationships – medicine | 6 years
Customer relationships – other courses | 4.5 years
Software license | 5 years
Education content | 3 years
Trademarks | 2 - 30 years
Developed technology | 5 years
For the years ended December 31, 2021, 2020 and 2019, there were no indicatives that the Company’s intangible assets with finite useful lives might be impaired.

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