Swisscom

Under IAS 36, Swisscom is required to regularly test the goodwill of its Italian subsidiary Fastweb for impairment. Within the regular impairment test it has become best practice to consider country risk premiums in the cost of capital of cash-generating units. IFBC was mandated by Swisscom to develop a method for determining Fastweb's Country Risk Premium and to calculate the current value. The reason for Swisscom to award the contract to IFBC was among others the developments on the financial markets during the financial crisis in general and of the yields and credit spreads of Italian government bonds in particular. Swisscom is the leading telecom-provider in Switzerland.