Details relating to the discounted cash flow models used in the impairment tests of the Pharmaceuticals, Vaccines and Consumer Healthcare cash generating units are as follows:
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| Valuation basis | Fair value less costs of disposal | |||||||||
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| Key assumptions | Sales growth rates | |||||||||
| Profit margins | ||||||||||
| Terminal growth rate | ||||||||||
| Discount rate | ||||||||||
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Taxation rate
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| Determination of assumptions | Growth rates are internal forecasts based on both internal and external market information. | |||||||||
| Margins reflect past experience, adjusted for expected changes. | ||||||||||
| Terminal growth rates based on management’s estimate of future long-term average growth rates. | ||||||||||
| Discount rates based on Group WACC, adjusted where appropriate. | ||||||||||
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Taxation rates based on appropriate rates for each region.
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| Period of specific projected cash flows | Five years | |||||||||
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| Terminal growth rate and discount rate | Terminal growth rate | Discount rate | ||||||||
| Pharmaceuticals | 1% p.a. | 7% | ||||||||
| Vaccines | 2% p.a. | 7% | ||||||||
| Consumer Healthcare | 2% p.a. | 7% | ||||||||
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