The movements under this heading in the balance sheet in 2019 and key information affecting the heading are as follows:
The main additions of property, plant and equipment correspond to the improvements to the IPTV platforms and the capitalisation of new television decoders as part of the Nova TV project launched in May 2019 and slated for completion during the first quarter of 2020. They also include the work to improve the radio network, mobile network and broadband network, along with projects to optimise the energy and air conditioning systems at the Massana technical centre and Nexus building, among others.
Derecognitions in 2019 primarily correspond to the investments in the SDH.ECI transport network and the switching stations that have been replaced, equipment and facilities in the Arans building that have been removed ahead of relocating the data centre to La Massana, and equipment related with the DTT service that fell into disuse in 2019.
This heading also includes derecognitions for devices on customers' premises that have been replaced as part of the Nova TV project.
The Impairment provision – Plant and equipment heading includes a provision of 566,741 euros to adjust the carrying amount of investments related with the Cloud Service Provider (CSP) project to their value in use.
The increase in depreciation of property, plant and equipment and amortisation of intangible assets versus 2018 is due to: the accelerated depreciation of a number of assets ahead of the first phase of the 5G roll-out at the end of 2021, the relocation of the Company's data centre in Arans to the La Massana data centre, and completion of the STB revamp, expected to be completed in the first quarter of 2020. The adjustment of the useful lives of these assets will give rise to an additional depreciation charge in 2019, 2020 or 2021 depending on each case.
The assets contributed to the Company under the Decree, dated 17 June 2015, on the allocation and contribution of assets, rights and obligations to the government-owned company Andorra Telecom, SAU, effective for accounting purposes from 1 January 2015, include the following national assets (Annexe II of the Decree), which were valued by an independent expert on 8 June 2015. The carrying amount of the assets at the allocation date was as follows:
The breakdown of equipment and technical facilities at 31 December 2019 is as follows:
The Company’s bylaws state that its corporate purpose includes the management and operation of telecommunications services and the management of the national radio and television networks. As the Company is unilaterally responsible for the broadcast of radio and television signals, it receives no remuneration for the management of said networks. The Law on public radio transmissions and the creation of the government-owned company RTVA, SA granted the Government powers to allocate the assets needed for the operation of radio and television services. This allocation did not make any reference to the assets held by the Company.
Installed equipment recorded under Plant and equipment includes items owned by the Company but in the possession of third parties who are customers of the Company.
It is the Company’s policy to take out insurance against any risks that may affect its property, plant and equipment. The insurance policies which were valid at 31 December 2019 were adequate to cover the Company’s assets.
