ANNUAL REPORT 2011 - DONG Energy

More documents

Recommendations

Info

notes 40 Description of accounting policies adjustments of financial contracts that are not used as economic hedges of the Group’s primary activities or that are part of the Group’s trading portfolio are recognised as finance income and costs. Under IFRS, contracts that involve physical delivery may, under certain circumstances, be accounted for as derivative financial instruments. The classification is determined based on an evaluation of the purpose of the contract compared with the Group’s other activities. Contracts entered into in the course of the Group’s trading activities or as part of certain hedging activities are classified and accounted for as derivative financial instruments, even though they are settled on physical delivery. Derivative financial instruments used for hedge accounting The Group applies the provisions on hedge accounting to derivative financial instruments and loans that hedge currency and interest rate risks. Up to and including 31 December 2010, commodity hedge transactions and related exposures to foreign currencies were also accounted for as cash flow hedge accounting. Market value adjustments of these, which were previously recognised in comprehensive income and a special reserve in equity, are recognised in profit for the year as the underlying transactions are realised or if the hedges are judged to no longer be effective. fair value hedging Changes in the fair value of derivative financial instruments that are designated as and qualify for recognition as hedges of the fair value of a recognised asset or liability are recognised in profit for the year together with changes in the value of the hedged asset or liability to the extent of the hedged risk. Hedging of future cash flows in accordance with an agreement (firm commitment) is accounted for as fair value hedging, except in the case of foreign currency hedging. Cash flow hedging Changes in the portion of the fair value of derivative financial instruments and foreign exchange adjustments of loans that is designated as and qualifies for recognition as a hedge of future cash flows and that provides an effective hedge against changes in the value of the hedged item are recognised directly in equity within a separate hedging reserve until the hedged cash flow is realised. On realisation of the hedged cash flow, the resulting gain or loss is transferred from equity and recognised in the same item as the hedged item; however, on hedging of the proceeds from future loans, the resulting gain or loss is transferred from equity over the term of the loan. 130 COnsOliDatED finanCial statEmEnts – DONG ENERGY ANNUAL REPORT 2011 If the hedged cash flows are no longer expected to be realised, the accumulated value adjustment is transferred immediately to profit for the year. Hedging of net investments Changes in the fair value of derivative financial instruments and borrowings that are used to hedge net investments in foreign subsidiaries or associates and that provide effective hedges against changes in foreign exchange rates in these enterprises are recognised in the consolidated financial statements directly in equity within a separate translation reserve. revenue Revenue comprises sales and transportation of oil and gas, distribution and storage of gas, sales and distribution of electricity and heat, and grants for the sale of eco-friendly electricity (price supplement), etc. Revenue is recognised in profit for the year when delivery and transfer of risk to buyer have taken place and to the extent that the income can be measured reliably and is expected to be received. Revenue is measured at the fair value of the agreed consideration excluding VAT and other indirect taxes collected on behalf of third parties. All forms of discounts granted are recognised as revenue. Construction contracts for the construction of assets involving a high degree of customisation, and the rendering of services (consultancy services, etc.), are recognised as revenue as the work to which they relate is performed or the service rendered to the effect that revenue corresponds to the selling price of the work performed during the year (percentage of completion method). When the outcome of a construction contract cannot be estimated reliably, revenue is recognised only to the extent of costs incurred that it is probable will be recoverable. Overlift/underlift of oil and gas is recognised as revenue at realisable value. Overlift/underlift relates to situations in which the Group participates in producing fields (licences) with several participants and where the Group has lifted and sold more or less oil and gas from the producing fields than its entitlement at the time of lifting. Physical and financial contracts relating to trading in oil, gas, electricity, CO2 emissions allowances, etc., that are concluded in the course of the Group’s trading activities with a view to generating gains from short-term price fluctuations are fair value adjusted under revenue. Value adjustments of financial instruments that have been entered into to hedge the Group’s primary operating activities but
do not satisfy the criteria for hedge accounting are recognised as revenue. Likewise, value adjustments of financial contracts offered to customers with a view to price hedging are recognised as revenue. fuel and energy Fuel and energy comprise the Group’s purchases of fuel in the form of gas, coal, biomass and oil, and energy purchases, as well as transportation costs in connection with the above and costs related to CO2 emissions. The costs are recognised in profit for the year as incurred. property, plant and equipment Property, plant and equipment comprise land and buildings, production assets, exploration assets, other assets, tools and equipment, etc. Property, plant and equipment are measured at cost less accumulated depreciation and impairment losses. Cost comprises purchase price and any costs directly attributable to the acquisition until the date the asset is available for use. The cost of self-constructed assets comprises direct and indirect costs of materials, components, subsuppliers and labour. Borrowing costs relating to both specific and general borrowing directly attributable to assets under construction with a lengthy construction period are recognised in cost during the construction period. Cost is increased by the present value of the estimated obligations for dismantling and removing the assets and restoring the site to the extent that they are recognised as a provision. In the case of assets held under finance leases, cost is determined at inception of the lease as the lower of the fair value of the assets and the present value of future minimum lease payments. The present value is determined using the interest rate implicit in the lease as the discount rate or an approximated value. Subsequent costs, for example in connection with replacement of parts of an item of property, plant and equipment, are recognised in the carrying amount of the asset in question when it is probable that future economic benefits will flow to the Group from the expenses incurred. Replaced parts are derecognised from the balance sheet, and their carrying amount is taken to profit for the year. All other repair and maintenance expenses are recognised in profit for the year as incurred. Exploration assets comprise acquired licences and reserves as well as exploration expenses that relate to successful wells. Costs are recognised using the successful efforts method. Under the successful efforts method, exploration expenses for drilling specific exploration wells are recognised in the balance sheet if the well is successful. Recognition in the balance sheet is maintained pending determination of commercial viability. Recognised exploration expenses for commercial discoveries are transferred to property, plant and equipment under construction on commencement of the construction of a field. All exploration expenses determined as unsuccessful are recognised in profit for the year as other external expenses. General exploration expenses are also recognised as other external expenses as incurred. Borrowing costs relating to exploration assets are recognised in profit for the year as incurred. Site development and construction costs relating to property, plant and equipment that it has been decided to invest in are recognised in the balance sheet within property, plant and equipment under construction until the date of entry into service. Following entry into service, these assets are transferred to the relevant items under property, plant and equipment. In the case of oil and gas production assets, cost is depreciated using the unit-of-production method based on the ratio of current production to estimated reserves by individual field. In the case of wind turbines, cost is depreciated taking into account the expected earnings profile, so that the depreciation pattern reflects the expected earnings patterns. In the case of other property, plant and equipment, cost is basically depreciated on a straight-line basis over the estimated future useful lives. Exploration assets and assets under construction are not depreciated, as depreciation of such assets does not commence until the assets are available for use, on which date they are transferred to the relevant item within property, plant and equipment, usually production assets. DONG ENERGY ANNUAL REPORT 2011 – COnsOliDatED finanCial statEmEnts 131 notes
Page 1 and 2:
MOVING ENERGY FORWARD ANNUAL REPORT
Page 3 and 4:
More reliable and clean energy DONG
Page 5 and 6:
More reliable and clean energy Mode
Page 7 and 8:
Q3 17 August signing of Eur 1.3 bil
Page 9 and 10:
ifrs statement of comprehensive inc
Page 11 and 12:
un Global Compact principle Climate
Page 13 and 14:
Spearheading the development of the
Page 15 and 16:
Waste is a valuable resource It is
Page 17 and 18:
DONG Energy involves local operator
Page 19 and 20:
The ambitious business strategy mea
Page 21 and 22:
DONG Energy contributes to green gr
Page 23 and 24:
The photo shows the Siri platform i
Page 25 and 26:
The photo shows the construction of
Page 27 and 28:
The photo shows one of the Group’
Page 29 and 30:
Strong market insight from experien
Page 31 and 32:
The photo shows a meter technician
Page 33 and 34:
monthly average 2011 2010 ∆ Oil,
Page 35 and 36:
Net finance costs amounted to DKK 0
Page 37 and 38:
New presentation of profit for the
Page 39 and 40:
Non-financial performance The Group
Page 41 and 42:
volumes Generation from wind and hy
Page 43 and 44:
was brought back online in October
Page 45 and 46:
Further information on DONG Energy
Page 47 and 48:
DONG Energy has a diversified loan
Page 49 and 50:
Market and credit risks The Group
Page 51 and 52:
isk and risk policy Exposure and he
Page 53 and 54:
isk and risk policy Exposure and he
Page 55 and 56:
Environment As an energy company, D
Page 57 and 58:
Under Danish legislation, the Group
Page 59 and 60:
information and communication DONG
Page 61 and 62:
lars nØrBy JOHansEn Deputy Chairma
Page 63 and 64:
pOul arnE niElsEn b. 1944. Joined t
Page 65 and 66:
The Board of Directors and the Exec
Page 67 and 68:
notes to the statement of cash flow
Page 69 and 70:
DKK million Note Business perfor ma
Page 71 and 72:
Equity and liabilities DKK million
Page 73 and 74:
DKK million Share capital Hedging r
Page 75 and 76:
DKK million Note 2011 2010 suppleme
Page 77 and 78:
02 Critical accounting estimates an
Page 79 and 80:
The excess of the cost of the acqui
Page 81 and 82:
• wind power: Development, constr
Page 83 and 84: Geographical breakdown 2011 DKK mil
Page 85 and 86: econciliations DKK million 2011 201
Page 87 and 88: emuneration of Board of Directors,
Page 89 and 90: 08 Fee to auditor appointed at the
Page 91 and 92: 13 Income tax expense DKK million 2
Page 93 and 94: DKK million Goodwill Cost at 1 Janu
Page 95 and 96: The main criteria used for determin
Page 97 and 98: DKK million Land and Impairment tes
Page 99 and 100: 17 Associates and other securities
Page 101 and 102: 19 Receivables DKK million 2011 201
Page 103 and 104: 20 Construction contracts DKK milli
Page 105 and 106: Hybrid capital due 3005 Hybrid capi
Page 107 and 108: Change in temporary differences in
Page 109 and 110: 25 Loans and borrowings DKK million
Page 111 and 112: 27 Income tax receivable and payabl
Page 113 and 114: 29 Disposal of enterprises DKK mill
Page 115 and 116: Other capital transactions with non
Page 117 and 118: Risk Price change Effect on profi t
Page 119 and 120: Categories of fi nancial instrument
Page 121 and 122: securities 2011 DKK million Nominal
Page 123 and 124: trading portfolio, economic hedging
Page 125 and 126: Hedging of net investments in forei
Page 127 and 128: 35 Lease commitments 2011 DKK milli
Page 129 and 130: As a condition for approval of its
Page 131 and 132: 39 Events after the reporting perio
Page 133: Regulated companies that operate ac
Page 137 and 138: translation reserve The translation
Page 139 and 140: eporting enterprise operates. Trans
Page 141 and 142: CO 2 emissions allowances Allocated
Page 143 and 144: Deferred tax is measured using the
Page 145 and 146: Definitions of performance highligh
Page 147 and 148: significant licences and hydrocarbo
Page 149 and 150: 42 Company overview Segment/company
Page 151 and 152: Segment/company Type 1 Registered o
Page 153 and 154: Segment/company Type 1 Registered o
Page 155 and 156: DONG ENERGY ANNUAL REPORT 2011 - CO
Page 157 and 158: Accounting policies for data collec
Page 159 and 160: significant environmental incidents
Page 161 and 162: fInancIal stateMents 2011 PARENT CO
Page 163 and 164: DKK million Note 2011 2010 profit f
Page 165 and 166: Equity and liabilities DKK million
Page 167 and 168: DKK million Share capital Hedging r
Page 169 and 170: 01 Basis of reporting The parent co
Page 171 and 172: 04 Staff costs DKK million 2011 201
Page 173 and 174: 06 Finance income DKK million 2011
Page 175 and 176: 09 Property, plant and equipment DK
Page 177 and 178: 12 Equity Share capital composition
Page 179 and 180: 14 Loans and borrowings DKK million
Page 181 and 182: 18 Financial risks DONG Energy A/S
Page 183 and 184: 19 Financial instruments maturity a
Page 185 and 186:
fair value hierarchy of financial i
Page 187 and 188:
22 Related party transactions tradi
Page 189 and 190:
Independent Auditor’s Report To t
Page 191 and 192:
coMPany announceMents IN 2011 Compa
Page 193 and 194:
glossaRy relatively low (off-peak).
show all

ANNUAL REPORT 2011 - DONG Energy

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?