Annual reports filed by certain Canadian issuers pursuant to Section 15(d) and Rule 15d-4

INTANGIBLE ASSETS, NET

v3.22.1
INTANGIBLE ASSETS, NET
12 Months Ended
Dec. 31, 2021
Disclosure of detailed information about intangible assets [abstract]  
INTANGIBLE ASSETS, NET [text block]
NOTE 11:-
INTANGIBLE ASSETS, NET
 
   
Cultivations and processing license *)
   
Customer relationships
   
Brand
   
Other
   
Total
 
                               
Cost:
                             
Balance as of January 1, 2020
 
$
831    
$
58    
$
63    
$
62    
$
1,014  
                                         
Purchases
    93       -       -       -       93  
Fair value adjustment derived from purchase price allocation
    110       -       -       -       110  
Foreign currency transaction
    26       -       -       6       32  
                                         
Balance as of December 31, 2020
    1,060       58       63       68       1,249  
                                         
Initial consolidations
    8,950       10,337       11,300       128       30,715  
Foreign currency transaction
    (49
)
    279       -       6       236  
                                         
Balance as of December 31, 2021
    9,961       10,674       11,363       202       32,200  
                                         
Accumulated amortization and impairment:
                                       
                                         
Balance as of January 1, 2020
    125       -       -       -       125  
                                         
Amortization recognized in the year
    31       -       -       -       31  
Foreign currency transaction
    -       -       -       1       1  
                                         
Balance as of December 31, 2020
    156       -       -       1       157  
                                         
Amortization recognized in the year
    618       469       8       63       1,158  
                                         
Balance as of December 31, 2021
    774       469       8       64       1,315  
                                         
Amortized cost at December 31, 2021
 
$
9,187    
$
10,205    
$
11,355    
$
138    
$
30,885  
Amortized cost at December 31, 2020
 
$
904    
$
58    
$
63    
$
67    
$
1,092  
 
*) The licenses consist of GMP and GDP licenses.

 

Impairment of goodwill and intangible assets:
 
Adjupahrm's recoverable amounts of the intangible assets and the goodwill were determined based on the value in use which is calculated at the expected estimated future cash flows, as determined according to the budget for the next three years and approved by the Company’s management. The pre-tax discount rate of the cash flows is 13.06%. The projected cash flows for the period exceeding three years was estimated using a fixed growth rate of 3%, representing the long-term average growth rate as customary in Adjupharm’s business. For the year ended December 31, 2021, the Company recorded a goodwill impairment in the amount of $275 with respect to Adjupharm.
 
Trichome's recoverable amounts of the intangible assets and the goodwill were determined based on the value in use which is calculated at the expected estimated future cash flows, as determined according to the budget for the next three years and approved by the Company’s management. The pre-tax discount rate of the cash flows is 11.78%. The projected cash flows for the period exceeding three years was estimated using a fixed growth rate of 4%, representing the long-term average growth rate as customary in Trichome's business. Based on the analysis performed the Company did not record goodwill impairment.
 
Acquisitions during the year:
 
In 2021, the Group entered into several business combination transactions. As part of these acquisitions, the Group identified cultivations and processing licenses, customer relationship, brand and others. The intangible assets identified have finite life and are being amortized on a straight-line basis over the useful life of the assets. During the year ended on December 31, 2021 and 2020, the Group recorded amortization expenses in the amount of $1,158 and $31, respectively. The amortization expenses are included in the cost of revenues and in the selling and marketing expenses.