£ Millions20182017
At 1 January40.437.7
Accrued consideration (Note 20)(0.2)
Recognised on acquisition of business12.53.9
Foreign currency translation1.2(1.0)
At 31 December54.140.4
Accumulated impairment loss
At 31 December
Carrying amount
At 31 December54.140.4

Goodwill arises on the consolidation of business/subsidiary undertakings.

As at the balance sheet date, the Group has recorded an estimated future payment related to the acquisition of the final 10.1% of Powersolve Electronics Limited. The Group will acquire the remaining 10.1% of Powersolve Electronics Limited in early 2022. When discounted to present value, the total of this payment is estimated at £0.6 million and that amount is reflected on the balance sheet. Since the final payment will be dependent on the actual financial performance of the business, an estimate is required to approximate future business conditions. There is no change in accrued consideration in 2018.

For the purpose of impairment testing, goodwill has been allocated to the cash-generating units according to operating segments identified in Note 4.

The recoverable amount of the goodwill is determined from value-in-use calculations. The key assumptions and estimates for the value-in-use calculations are those regarding the discount rates, growth rates and expected changes to sales and overheads during the period. Management estimates discount rates using pre-tax rates that reflect current market assessments of the time value of money and the risks specific to the cash-generating units. The rate used in 2018 was 10.8% for Europe, 7.1% for North America and 7.9% for Asia. For 2017, a rate of 5.5% was used for Europe, North America and Asia.

The Group prepares cash flow forecasts derived from the most recent financial results and takes into account industry growth forecasts for five years and estimates cash flows based on these forecasts assuming no growth after five years. Management has forecast year-on-year increases in sales and overheads averages of 5.0% and 3.0% respectively. The carrying amount of goodwill as at 31 December 2018 was £54.1 million (2017: £40.4 million) with no impairment adjustment required for 2018 (2017: no impairment).

For the purpose of the impairment test, the Group has adopted what it believes to be reasonable Earnings Before Interest, Tax, Depreciation, Amortisation assumptions for the period from 1 January 2019 to 31 December 2023. Management believes that any reasonable possible change in the key assumptions on which the recoverable amount is based would not cause the carrying amount of goodwill to exceed its recoverable amount.