Výročná správa 2009 - Komunálna Poisťovňa

(All amount are in thousands of Euros, unless stated otherwise)(iii) Termination benefitsTermination benefits are payable when employment is terminated due to reasons stated in Article63, paragraph 1a) or b) before the normal retirement date, at two average monthly salaries,or three average monthly salary if worked for the Company more than five years.2.15 ProvisionsProvisions for legal claims are recognized when: the Company has a present legal or constructiveobligation as a result of past events; it is more likely than not that an outflow of resourceswill be required to settle the obligation; and the amount has been reliably estimated. Provisionsare not recognized for future operating losses.2.16 Revenue recognition(i) Interest incomeInterest income for financial assets that are not classified at fair value through profit or lossis recognized as revenue using the effective interest method. Interest income is disclosed underfinancial investment income.(ii)Dividend incomeDividend income is recognized when the right to receive payment is established.2.17 LeasesLeases in which a significant portion of the risks and rewards of ownership are retained by thelessor are classified as operating leases. Payments made under operating leases are charged tothe income statement on a straight-line basis over the period of the lease.2.18 DividendsDividend distribution to the Company’s shareholders is recognized as a liability in the periodwhen the dividend distribution has been approved by general meeting.2.19 Business combinations involving entities under common controlKONTINUITA poisťovňa a.s. Vienna Insurance Group legally merged with the Company on 1October 2009 (Note 14). The acquisition of a subsidiary from entities under common control isaccounted for in line with the predecessor’s carrying value method. The book value of acquiredassets and liabilities was recorded on the day of legal merger as at 1 October 2009. The profit ofKONTINUITA poisťovňa a.s. Vienna Insurance Group for the period ended 30 September 2009is not part of the profit of the Company, and is recognized in these financial statements as anadjustment in equity of KOMUNÁLNA poisťovňa a.s. Vienna Insurance Group.3. Critical accounting estimates and judgmentsThe Company makes estimates and assumptions that affect the reported amounts of assetsand liabilities within the next financial year. Estimates and judgements are continually evaluatedand based on historical experience and other factors, including expectations of future events thatare believed to be reasonable under the circumstances.Ročná účtovná závierka a komentár I Company AccountsSignificant estimates and assumptions, where there is risk of significant adjustment of thebook value of assets and liabilities during the following accounting period, are described below.133