Annual report - HSE
Annual report - HSE
Annual report - HSE
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5.5.6 Branch and representative offices<br />
The Group has three foreign branch offices - in the Czech Republic, Slovakia and Macedonia,<br />
and a representative office in Romania. In 2012, the Group operated through the branch<br />
offices to a minimum degree. The operations of branch and representative offices are<br />
included in the Group’s financial statements.<br />
5.5.7 Significant accounting policies<br />
The consolidated financial statements are prepared on the basis of accounting policies<br />
presented below. The abovementioned accounting policies are used for all years<br />
presented, unless otherwise indicated.<br />
The comparative data was adopted when needed so that it is in accordance with the<br />
presentation of data in the current year.<br />
5.5.7.1 Basis for consolidation<br />
Consolidated financial statements comprise financial statements of the controlling<br />
company and subsidiaries. Subsidiaries are companies controlled by the Group. This means<br />
that the Group is able to decide on financial and business orientations of the company for<br />
obtaining benefits from its operations. Financial statements of subsidiaries are included in<br />
consolidated financial statements from the date when the controlling begins to the date<br />
when it stops.<br />
Transactions with the owners of non-controlling share are considered in a same way as<br />
transactions with external partners. Profits and losses of the owners of non-controlling<br />
share are disclosed in the consolidated income statement. The equity of non-controlling<br />
share owners in the consolidated statement of financial position is disclosed separately<br />
from other equity items.<br />
The financial statements of Group companies have been incorporated into the consolidated<br />
financial statements on the basis of full consolidation. The financial statements are merged<br />
item by item by adding up similar items of assets, liabilities, equity, revenue and expenses.<br />
Consolidated financial statements do not include balances of receivables and liabilities<br />
among the Group companies, revenue and expenses and unrealised profits and losses<br />
from transactions within the Group.<br />
Exchange differences from translation of financial statements of subsidiaries whose<br />
functional currency is not the same as presentation currency of the Group are recognised<br />
in consolidated equity adjustment or statement of other comprehensive income.<br />
5.5.7.2 Intangible assets<br />
Intangible assets are long-term assets enabling the performance of the Group companies’<br />
registered activities without existing physically.<br />
Intangible assets comprise long-term property rights (also emission coupons), goodwill<br />
and other intangible assets.<br />
Upon initial recognition, an intangible asset is measured at cost. The cost also includes<br />
import and non-refundable purchase taxes after the commercial and other discounts<br />
have been deducted and all costs directly attributable to preparation of an asset for the<br />
intended use. Borrowing costs that are directly attributed to the purchase of an intangible<br />
qualifying asset (until its capitalisation) are recognised as a part of cost of such asset.<br />
Intangible assets are subsequently measured using the cost model.<br />
The Group has no intangible assets, for which it would record the residual value when<br />
purchased.<br />
<strong>Annual</strong> Report <strong>HSE</strong> 2012<br />
5 Financial Report of <strong>HSE</strong> Group<br />
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