v3.25.2
INTANGIBLE ASSETS, NET AND GOODWILL
 12 Months Ended
Dec. 31, 2024
Notes and other explanatory information [abstract]  
INTANGIBLE ASSETS, NET AND GOODWILL

NOTE 7 - INTANGIBLE ASSETS, NET AND GOODWILL:

 SUMMARY OF INTANGIBLE ASSETS NET 

   Capitalization of development costs   Purchased license   Core Technology License   Total 
                 
COST                    
As of January 1, 2024   5,342    819    10,449    16,610 
Capitalized development cost   169    -    -    169 
Currency translation adjustments   (245)   (37)   -    (282)
As of December 31, 2024   5,266    782    10,449    16,497 
                     
Accumulated amortization                    
As of January 1, 2024   124    -    -    124 
Amortization   694    75    1,306    2,075 
Impairment   2,197    -    -    2,197 
Currency translation adjustments   (227)   -    -    (227)
As of December 31, 2024   2788    75    1,306    4,169 
                     
Net book value as of December 31, 2024   2,478    707    9,143    12,328 

 

 

SMX (SECURITY MATTERS) PUBLIC LIMITED COMPANY

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(US$ in thousands)

 

NOTE 7 - INTANGIBLE ASSETS, NET AND GOODWILL (CONT.):

 

   Capitalization of development cost   Purchased license   Core Technology License   Total 
                 
COST                    
As of January 1, 2023   4,372    655    -    5,027 
Capitalized development cost   977    157    10,449    11,583 
Currency translation adjustments   (7)   7    -    - 
As of December 31, 2023   5,342    819    10,449    16,610 
                     
Accumulated amortization                    
As of January 1, 2023   127    -    -    127 
Currency translation adjustments   (3)   -    -    (3)
As of December 31, 2023   124    -    -    124 
                     
Net book value as of December 31, 2023   5,218    819    10,449    16,486 

 

Intangible assets as of December 31, 2024 and 2023 consist of capitalized development costs of the Group’s technology, the cost of the exclusive license intellectual property and core technology license raised from the TrueGold business combination that reflects the existence of underlying technology that has value through its continued use or re-use in many products or many generations of a singular product (that is, a product family). See also note 3. The capitalized development costs and purchased license are amortized in accordance with its useful life of 5.5 years. The Core Technology License is amortized in accordance with its useful life of 4 years.

 

Goodwill and impairment

 

The Group is required to test, on an annual basis, whether goodwill has suffered any impairment. The recoverable amount is determined based on value in use calculations. The use of this method requires an estimation of future cash flows and the determination of a discount rate in order to calculate the present value of the cash flows.

 

During the year, the Group did not meet its revenue forecast. This had an adverse impact on the projected value in use of the operation and consequently resulted in an impairment to goodwill of $6,813. The (pre-tax) discount rate used to measure the CGU’s value in use was 29.6%.

 

The carrying amount of goodwill is $26,144 as of December 31, 2024.

 

The recoverable amount has been determined from value in use calculations based on cash flow projections from Company approved budgets.

 

 

SMX (SECURITY MATTERS) PUBLIC LIMITED COMPANY

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(US$ in thousands)