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Annual Report & Accounts 2009 - Notes
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60 There was a significant winner of a jackpot during the year ended 31 December 2009. A single player won c308,999.08 on a game known as "Roman Empire." In accordance with the group's policy, the amount withdrawn by the customer (in this case c250,000) has been treated as an exceptional item (see note 6.2.1). 25. ACCOUNTING ESTIMATES AND JUDGEMENTS The directors discuss the development, selection and disclosure of the Group's critical accounting policies and estimates and the application of these policies and estimates. The estimates and judgements which have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below. 25.1 Impairment of goodwill and trademarks Determining whether goodwill and trademarks with an indefinite useful life are impaired requires an estimation of the value in use of the cash-generating units. The value-in-use calculation requires the entity to estimate the future cash flows expected to arise from the cash-generating unit and select a suitable discount rate in order to calculate present value. Note 11.5 provides information on the assumptions used in these financial statements. The valuation work to assess the impairment of goodwill and intangible assets was conducted by Chartered Accountants, BDO Stoy Hayward, London. 25.2 Valuation of betboo.com The acquisition of betboo.com required estimations of the fair value of the consideration payable, as well as judgements relating to the value of the acquired intangible assets. The valuation work to assess the fair value of consideration payable and acquired intangible assets was conducted by Chartered Accountants, BDO Stoy Hayward, London. 25.3 Share options Accounting for share option charges requires a degree of judgement over such matters as dividend yield, and expected volatility. Further details on the assumptions made by management are disclosed in note 20. 25.4 Open bets The directors review the scale and magnitude of open bets frequently, and in particular at the balance sheet date. Assessments are made on whether to make provisions for the outcome of such open bets. Management have assessed that the value of open bets at year end is not material. 26. GOING CONCERN The Group's business activities, together with the factors likely to affect its future performance and position are set out in the Chairman's statement and the reports of the Chief Executive and the Finance Director. Note 21 to the financial statements sets out the Group's financial risk management policies, and its exposure to credit risk and liquidity risk. The Directors have assessed the financial risks facing the business, and compared this risk assessment to the net current assets position and dividend policy. The Directors have also reviewed relationships with key suppliers and software providers and are satisfied that the appropriate contracts and contingency plans are in place. The directors have prepared income statement and cash flow forecasts to assess whether the Group has adequate resources for the foreseeable future.