• Annual review 2005
• Annual report 2005

• President and CEO
• Report of the Board of Directors
• Financial statements:
  Telenor Group
  • Profit and loss
  • Balance Sheet
  • Cash Flow
  • Equity
  • According to Norwegian GAAP
  • Accounting policies
  • Notes
• Financial statements:
  Telenor ASA
• Auditor's report
• Financial calendar 2006

Note 15: Amortization, depreciation and write-downs

Details of amortization, depreciation and write-downs:
	Property, plant and equipment		Goodwill		Other intangible assets		Prepaid leases
NOK in millions	2005	2004	2005	2004	2005	2004	2005	2004
Amortization and depreciation	8 083	7 737	-	-	3 407	2 900	54	-
Write-downs	488	282	46	3 129	53	120	-	-
Total	8 571	8 019	46	3 129	3 460	3 020	54	-

Prepaid leases are payments made on entering into leases or acquiring leaseholds that are accounted for as operating leases. These prepaid lease payments are amortized over the lease term in accordance with the pattern of benefits provided. They relate primarily to access charges for lease of the copper cables of other operators (local loop unbundling etc), primarily in the Fixed operations in Sweden and Denmark that were acquired during 2005. The amortization period for access charges are the estimated customer relationship, based on past history.

Estimated useful lives of property, plant and equipment and other intangible assets are reviewed annually to insure consistency with the expected economic recovery period for these assets based on current facts and circumstances. As of 1 January 2005 some changes were made in estimated useful lives, especially for some components in the different networks

Various components of the networks were affected, including switches, radio and transmission equipment in the mobile operations, masts, towers and network buildings in the mobile, fixed and broadcast operations, fibre cables in the fixed transportation network and digital transmission equipment for ADSL in Norway. As of 1 January 2005 the estimated useful lives for some of these assets were increased and others were decreased. The reasons for increasing useful lives were primarily based on recent experience that some assets are now being utilized over a longer economic life than previously expected because they are not as affected by changes in technological developments as previously expected and for some assets because Telenor now expected a slower pace of changes in the network than in previous years. On the other hand Telenor decreased its expected useful lives for some assets, primarily due to a higher pace of replacements than previously expected, due to company or asset specific reasons.

The change in useful lives as of 1 January 2005 is estimated to have increased depreciation and amortization by approximately NOK 270 million, of which the highest impact was for Kyivstar.

Details of write-downs:

Details of write-downs:
		2005				2004
NOK in millions	Property, plant and equipment	Goodwill 1)	Other intangible assets		Property, plant and equipment	Goodwill 1)	Other intangible assets
Telenor Mobil – Norway	14	2	-		6	-	9
Sonofon – Denmark	-	-	-		208	3 074	8
Kyivstar – Ukraine	15	-	-		-	-	-
Pannon GSM – Hungary	6	-	1		21	-	-
DiGi.Com – Malaysia	5	-	-		-	-	-
GrameenPhone – Bangladesh	-	-	-		3	-	-
Other mobile operations	-	-	-		14	-	61
Fixed	571	(36)	52		13	27	-
Broadcast	(128)	75	-		12	25	7
Other operations	5	5	-		5	3	35
Total	488	46	53		282	3 129	120
1) See note 16 and 17.

The write-downs of property, plant and equipment and intangible assets in 2005 were primarily related to Fixed Sweden to its estimated recoverable amount based on fair value less cost to sell. The write-down was due to increased competition and a general shift in product demand to lower priced products. The assessment of the fair value was based on various valuation methods, with assistance of an external valuation expert. In 2005 Broadcast reversed a previous write-down of satellites by NOK 133 million. The write-downs of goodwill was primarily due to previously not recognized deferred tax assets at acquisition of companies, partially offset by the excess of fair value of net assets over the cost of a business combination that was recognized immediately to income.

The write-downs of property, plant and equipment in 2004 were primarily on the transmission network in Sonofon Holding A/S due to the market situation. The recoverable amount was determined on the basis of the value in use. Write-downs of goodwill primarily related to Sonofon, see note 17. Write-downs were also made due to previously not recognized deferred tax assets at acquisition of companies.

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