Annual report - HSE

4.5.3 Basis of measurement
Company’s financial statements are prepared on the basis of balance sheet items historical
values, except the following assets and liabilities carried at fair value.
4.5.4 Currency reports
4.5.4.1 Functional and presentation currency
The financial statements contained in this Report are presented in euro (EUR) without
cents. The euro has been the functional and presentation currency of the company. Due to
the rounding of amounts, minor but insignificant deviations exist in the tables.
4.5.4.2 Foreign currency translation
Transactions expressed in foreign currency are translated into the relevant functional
currency at the exchange rate applicable on the date of transaction.
Cash and liabilities expressed in a foreign currency at the end of the reporting period are
converted into functional currency at then applicable exchange rate.
Positive or negative foreign exchange differences are differences between amortised cost
in the functional currency at the beginning of the period, which is repaired for the amount
of effective interest and payments during the period, as well as amortised cost in foreign
currency converted at the exchange rate at the end of the period.
Foreign exchange differences are recognised in the income statement, namely in net
amounts.
4.5.5 Use of assessments and judgements
The preparation of financial statements requires that the management forms certain
assessments and assumptions which affect the disclosed amounts of assets and liabilities,
revenue and expenses and disclosures of contingent assets and expenses in the reporting
period.
Assessments and judgements are based on past experience and other factors that are
considered reasonable in the given circumstances and on the basis of which the judgements
on the carrying amount of assets and liabilities are expressed. Since the assessments
and assumptions are subject to subjective judgement and certain level of uncertainty,
subsequent actual results can differ from assessments. The assessments are examined
on regular basis. Changes in accounting estimates are recognised in the period in which
the assessments were changed if the change affects only that period or in the period of
change and in future periods in case the change affects future periods.
Assessments and assumptions are present at least at the following judgements:
Annual Report HSE 2012
4 Financial Report of the company HSE
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• assessment of useful life of amortisable assets (disclosure 4.5.8.1, points 1 and 2);
• test of impairment of assets (disclosure 4.5.8.1, points 1, 2 and 3);
• assessment of fair value of derivatives (disclosure 4.5.8.1, point 9);
• assessment of realisable values of receivables (disclosure 4.5.8.8.1);
• assessment of provisions for jubilee and termination benefits (disclosure 4.5.8.1, point
10);
• assessment of other provisions (disclosure 4.5.8.1, point 11); and
• assessment of contingent liabilities and assets (disclosure 4.5.8.1, point 16).