XML 36 R21.htm IDEA: XBRL DOCUMENT
v3.22.0.1

Goodwill and intangible assets | 12 Months Ended
--- | ---
Dec. 31, 2021
Intangible assets and goodwill [abstract] |
Goodwill and intangible assets | Goodwill and intangible assets
| Internal development costs and patents |  | Acquired intangible assets |  | Total |  | Goodwill |  | Total
| (in € millions)
Cost |  |  |  |  |  |  |  |  |
At January 1, 2020 | 45 |  |  | 47 |  |  | 92 |  |  | 478 |  |  | 570 |
Additions | 19 |  |  | — |  |  | 19 |  |  | — |  |  | 19 |
Acquisition, business combination (Note 5) | — |  |  | 48 |  |  | 48 |  |  | 304 |  |  | 352 |
Exchange differences | — |  |  | (4) |  |  | (4) |  |  | (46) |  |  | (50) |
At December 31, 2020 | 64 |  |  | 91 |  |  | 155 |  |  | 736 |  |  | 891 |
Additions | 13 |  |  | — |  |  | 13 |  |  | — |  |  | 13 |
Acquisition, business combination (Note 5) | — |  |  | 7 |  |  | 7 |  |  | 106 |  |  | 113 |
Write-off of fully amortized intangible assets | (13) |  |  | — |  |  | (13) |  |  | — |  |  | (13) |
Exchange differences | — |  |  | 7 |  |  | 7 |  |  | 52 |  |  | 59 |
At December 31, 2021 | 64 |  |  | 105 |  |  | 169 |  |  | 894 |  |  | 1,063
Accumulated amortization |  |  |  |  |  |  |  |  |
At January 1, 2020 | (19) |  |  | (15) |  |  | (34) |  |  | — |  |  | (34) |
Amortization charge | (12) |  |  | (13) |  |  | (25) |  |  | — |  |  | (25) |
Exchange differences | — |  |  | 1 |  |  | 1 |  |  | — |  |  | 1 |
At December 31, 2020 | (31) |  |  | (27) |  |  | (58) |  |  | — |  |  | (58) |
Amortization charge | (15) |  |  | (18) |  |  | (33) |  |  | — |  |  | (33) |
Write-off of fully amortized intangible assets | 13 |  |  | — |  |  | 13 |  |  | — |  |  | 13 |
Exchange differences | — |  |  | (2) |  |  | (2) |  |  | — |  |  | (2) |
At December 31, 2021 | (33) |  |  | (47) |  |  | (80) |  |  | — |  |  | (80) |
Cost, net accumulated amortization |  |  |  |  |  |  |  |  |
At December 31, 2020 | 33 |  |  | 64 |  |  | 97 |  |  | 736 |  |  | 833 |
At December 31, 2021 | 31 |  |  | 58 |  |  | 89 |  |  | 894 |  |  | 983 |
Amortization charges related to intangible assets of €25 million, €18 million and €14 million in 2021, 2020, and 2019, respectively, are included in research and development in the consolidated statement of operations. Research and development costs that are not eligible for capitalization have been expensed in the period incurred. There were no impairment charges for goodwill or intangible assets in 2021, 2020, and 2019, respectively. Goodwill is tested for impairment on an annual basis or when there are indications the carrying amount may be impaired. Goodwill is allocated to the Group’s two operating segments, Premium and Ad-Supported, based on the segment that is expected to benefit from the business combination. The Group monitors goodwill at the operating segment level for internal purposes, consistent with the way it assesses performance and allocates resources. The carrying amount of goodwill allocated to each of the operating segments is as follows:
| Premium |  | Ad-Supported |  | Premium |  | Ad-Supported
| 2021 |  | 2021 |  | 2020 |  | 2020
| (in € millions)
Goodwill | 129 |  |  | 765 |  |  | 125 |  |  | 611 |
Valuation methodology The Group performed its annual impairment test in the fourth quarter of 2021. The recoverable amount of the Premium and Ad-Supported operating segments are assessed using a fair value less costs of disposal (“FVLCD”) model. The FVLCD valuation is considered a level 3 in the fair value hierarchy, as it uses significant unobservable inputs. FVLCD is calculated using both the income and market approaches. The income approach is calculated by discounting the projected cash flows of each of the operating segments. The market valuation is calculated by applying multiples from comparable publicly traded companies to the revenue of the preceding and forecasted twelve months, before and after the date of the impairment test, respectively. As a result of the analysis, the FVLCD for the Premium and Ad-Supported operating segments was determined to be in excess of their carrying amounts. Key assumptions used in the FVLCD calculations at the impairment testing date In 2021, the Group weighted the income and market approaches 50% and 50%, respectively, for each of its operating segments. The key assumptions used in the income approach was the discount rate based on the weighted-average cost of capital. The discount rate was 7.5% and 9.5% for the Group’s Premium and Ad-Supported segments, respectively. The key assumptions used in the market approach were the revenue multiples for comparable companies, which were selected based on industry similarity, financial risk, and size of each of the Group’s operating segments. Revenue multiples used in the market approach ranged from 3.0 to 7.0. There are no reasonably possible changes in the key assumptions that would result in the operating segments’ carrying amounts exceeding their recoverable amounts.

X
- Definition The disclosure of intangible assets and goodwill. [Refer: Intangible assets and goodwill] + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Name IAS -Number 1 -IssueDate 2021-01-01 -Paragraph 10 -Subparagraph e -URI http://eifrs.ifrs.org/eifrs/xifrs-link?type=IAS&num=1&code=ifrs-tx-2021-en-r&anchor=para_10_e&doctype=Standard -URIDate 2021-03-24 + Details
Name: | ifrs-full_DisclosureOfIntangibleAssetsAndGoodwillExplanatory
Namespace Prefix: | ifrs-full_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | ifrs-full_IntangibleAssetsAndGoodwillAbstract
Namespace Prefix: | ifrs-full_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration