Consolidated Financial Statements and Consolidated Management ...

The Group is currently analysing how this new definition of control will impact its consolidated companies and, at today’s date, it would not lead to
the inclusion of any additional entity.
IFRS 11 Joint Arrangements will replace IAS 31, which is currently in force. The fundamental change which IFRS 11 addresses with regard to the current
standard is the elimination of the proportional consolidation option for jointly controlled entities, which would be consolidated by the equity method.
This new standard will have an effect on the Group’s consolidated annual accounts, as the proportional consolidation option has been used to
consolidate joint ventures in its financial statements (see Note 15.3 and Annex II). Thus, the impact of consolidation of joint ventures by the equity
method instead of by proportional consolidation would involve a lower net turnover figure of 3,162,000 euros and lower operating costs of 5,852,000
euros, which have been calculated with reference to the current figures.
The amendments to IAS 27 and IAS 28 run parallel to the issuance of the new IFRS mentioned above.
In any case, no further changes other than the above will affect the Group.
Lastly, IFRS 12 is a disclosure standard which groups together all the accounting disclosure requirements on interests in other entities (be they
subsidiaries, associates, joint ventures or other interests), including new disclosure requirements.
Its entry into force would therefore probably broaden the disclosures currently required by the Group on interests in other entities and other
investment vehicles.
IFRS 13 Fair Value Measurement. This new standard was issued as the sole regulatory source to calculate the fair value of asset or liability elements
which are valued in this way, as required by other standards. IFRS 13 changes the current definition of fair value and introduces new nuances to be
taken into consideration. It also adds to the disclosures required on this issue.
The Group has analysed the potential impacts the new definition of fair value would have on the valuation of asset and liability elements. It will
probably not give rise to significant changes regarding the assumptions, methods and calculations currently made.
Amendment of IAS 19 Employee Benefits. The change brought about by this amendment will essentially affect the accounting treatment of defined benefit
plans, as it eliminates the “fluctuation band” that currently makes it possible to choose to defer a certain proportion of actuarial gains and losses. All actuarial
gains and losses will be immediately recognised in other comprehensive income once the amendment enters into force. It will also involve changes in the
presentation of cost components in the comprehensive profit and loss statement, which will be grouped together and presented in a different way.
So far, the future impact of adoption of this standard has not been analysed.
2.2. Information on 2010
As required by IAS 1, the information from 2010 contained in this consolidated annual report is presented solely for comparison with the information from
2011 and consequently does not in itself constitute the Group’s consolidated annual accounts for 2010.
2.3. Currency of presentation
These consolidated financial statements are presented in euros. Any foreign currency transactions have been booked in accordance with the criteria
described in Note 4.9.
2.4. Responsibility for the information, estimates made and sources of uncertainty
The Directors of the Parent Company are responsible for the information contained in these consolidated financial statements.
Estimates made by the management of the Group and of the consolidated entities (subsequently ratified by their Directors) have been used in the Group’s
consolidated financial statements to quantify some of the assets, liabilities, revenue, expenses and undertakings recorded. These estimates essentially
refer to:
- Losses arising from asset impairment.
- Hypotheses used in the actuarial calculation of liabilities for pensions and other undertakings made to the workforce.
- Useful life of the tangible and intangible assets.
- Valuation of consolidation goodwill.
- Market value of specific assets.
- Estimation of onerous agreements.
- Calculation of provisions and evaluation of contingencies.
These estimates were made on the basis of the best available information on the facts analysed. Nonetheless, it is possible that future events may take
place that make it necessary to modify them, which would be done in accordance with IAS 8.
No fact existed on the date these consolidated financial statements were issued that could be a source of significant uncertainty regarding the accounting
effect such facts could have in future financial years.
As can be seen in the balance sheet, current liabilities considerably exceed current assets. As is described in Note 30, the Parent Company concluded
the process of refinancing the Group’s debt subsequent to year-end by adapting its repayment schedule to the generation of resources foreseen in its
business plan.
2.5. Consolidation principles applied
2.5.1. Subsidiaries (See Annex I)
Subsidiaries are considered as any company included within the scope of consolidation in which the Parent Company directly or indirectly controls their
management due to holding the majority of voting rights in the governance and decision-making body, with the capacity to exercise control. This capacity is
shown when the Parent Company holds the power to manage an investee entity’s financial and operating policy in order to obtain profits from its activities.
The financial statements of subsidiaries are consolidated with those of the Parent Company by applying the full consolidation method. Consequently,
all significant balances and effects of any transactions taking place between them have been eliminated in the consolidation process.
Stakes held by minority members in the Group’s equity and results are respectively presented in the “Minority interests” item of the consolidated
balance sheet and of the consolidated comprehensive profit and loss statement.
The profit or loss of any subsidiaries acquired or disposed of during the financial year are included in the consolidated comprehensive profit and loss
statement from the effective date of acquisition or up to the effective date of disposal, as appropriate.
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REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS