Matth. Hohner AG

Notes to the Consolidated Financial Statements for Business Year 2010/2011
Deferred taxes
Deferred taxes are recognized using the liability method according for all temporary differences between the
carrying amounts of assets or liabilities in the balance sheet and the amounts used for income tax purposes as
of the balance sheet date. Deferred tax liabilities are recognized for all taxable temporary differences.
Deferred tax assets are recognized for all deductible temporary differences, unused tax losses and unused tax
credits to the extent that it is probable that future taxable profit will be available against which the deductible
temporary differences, unused tax loss and unused tax credits can be utilized. The following exceptions apply:
• No deferred tax assets may be recognized from deductible temporary differences arising on initial
recognition of an asset or liability in a transaction that is not a business combination and at the time of the
transaction affects neither accounting profit nor taxable profit or loss.
• Deferred tax assets may only be recognized for taxable temporary differences related to investments in
subsidiaries, associates and interests in joint ventures to the extent that it is probable that the temporary
differences will reverse in the foreseeable future and sufficient taxable profit will be available against which
the temporary differences can be utilized.
The carrying amount of a deferred tax asset is reviewed at each balance sheet date and reduced to the extent
that it is no longer probable that sufficient tax profit will be available to allow all or part of the deferred tax
asset to be utilized. Unrecognized deferred tax assets are reviewed at each balance sheet date and recognized
to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be
recovered.
A planning period of five years is used as a basis for the calculation.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when
the asset is realized or the liability matures based on the tax rates (and tax laws) that have been enacted or
substantively enacted on the balance sheet date.
Income taxes relating to items posted directly to equity are recognized in equity and not the income
statement.
Deferred tax assets and deferred tax liabilities are offset if the Group has a legally enforceable right to offset
current tax assets and current tax liabilities and these relate to income taxes levied by the same tax authority
on the same taxable entity
Value added tax
Revenue, expenses and assets are recognized net of sales taxes. The following exceptions apply:
• Where VAT incurred on the purchase of goods or services cannot be claimed by from the tax authorities,
the VAT amount is recognized as part of the cost of the asset or as part of the expenses.
• Receivables and liabilities are recognized at amounts including any sales tax.
The amount of sales tax refunded by or transferred to the tax authorities is recognized under current other
receivables or other trade payables in the balance sheet.
I. Notes to the balance sheet
1. Intangible assets
The amount disclosed largely pertains to licenses for software and the goodwill of Hohner S.A. of TEUR 102.
The capitalized goodwill is tested annually for impairment and in the event of impairment is written down
against profit and loss. In the interests of clarity and transparency, further disclosures are not made.
Research and development costs recorded in the income statement in the reporting year amount to TEUR 975
(prior year: TEUR 1,049). No development costs were capitalized in the reporting period.
The separate presentation of the development of intangible assets is attached as exhibit to the notes.
Notes to the CoNsolidated FiNaNCial statemeNts Notes to the CoNsolidated FiNaNCial statemeNts
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