Page 139 - Annual Report 2022

77 Banka Kombëtare Tregtare Annual Report 2022

Banka Kombëtare Tregtare Sh.a.
Notes to the Consolidated Financial Statements for the year ended
31 December 2022 (Amounts in USD, unless otherwise stated)

14. Intangible assets
Intangible assets as at 31 December 2022 and 31 December 2021 are composed as follows:

Software
Gross value
At 1 January 2021 18,049,222
Additions 2,316,898
Translation difference (965,652)
At 31 December 2021 19,400,468
Additions 6,349,767
Translation difference (92,426)
At 31 December 2022 25,657,809

Accumulated depreciation
At 1 January 2021 (13,889,771)
Charge for the year (2,204,507)
Translation difference 827,378
At 31 December 2021 (15,266,900)

Charge for the year (2,924,332)
Translation difference (31,640)
At 31 December 2022 (18,222,872)
Net book value
At 1 January 2021 4,159,451
At 31 December 2021 4,133,568
At 31 December 2022 7,434,937

Software represents mainly the upgraded Bank’s operating and accounting system, and the license and software for providing
internet and mobile banking services.

15. Right of use asset & Lease Liability
The Bank has applied IFRS 16 using the modified retrospective approach. At lease commencement date, the Bank recognises
a right-of-use asset and a lease liability on the balance sheet. The right-of-use asset is measured at cost, which is made up of
the initial measurement of the lease liability, any initial direct costs incurred by the Bank, an estimate of any costs to dismantle
and remove the asset at the end of the lease, and any lease payments made in advance of the lease commencement date (net
of any incentives received).
The Bank depreciates the right-of-use assets on a straight-line basis from the lease commencement date to the earlier of the end
of the useful life of the right-of-use asset or the end of the lease term. At the commencement date, the Bank measures the lease
liability at the present value of the lease payments unpaid at that date, discounted using the interest rate implicit in the lease if
that rate is readily available or the Bank’s incremental borrowing rate. The rate used for calculation of the RoU asset and Lease
liability has taken into consideration the term, FX denomination, risk associated with the Bank, security, risk associated with the
asset and economic environment.
The Bank uses the EUR 10,000 as a threshold and simultaneously analyses the nature of the asset in order to assess whether
a leased asset qualifies for the low-value asset exemption. The types of assets that qualify for the low-value asset exemption
might change over time if, due to market developments, the price of a particular type of asset changes. The Bank has elected
to account for short-term leases and leases of low-value assets using the practical expedients. Instead of recognising a right-
of-use asset and lease liability, the payments in relation to these are recognised as an expense in profit or loss on a straight-line
basis over the lease term.