annual financial statement 2011 - conwert Immobilien Invest SE

CONWERT IMMOBILIEN INVEST SE
ANNUAL FINANCIAL 2011 STATEMENT ANNUAL REPORT 2011
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2.3. BASIS OF CONSOLIDATION
2.3.1. INTRODUCTION
International Financial Reporting Standards require the application of IFRS 3 to business combinations.
Relevant information is provided under note 2.4.2. When a company acquires a group of
assets or net assets that do not constitute a business, it must allocate the cost of the acquisition
between the individual identifiable assets and liabilities of the group based on their relative fair
value at the acquisition date (IFRS 3.2(b)). All acquisitions of property project companies in 2011
represented the purchase of individual assets by conwert. These transactions are not considered
business combinations in the sense of IFRS 3 because the acquired companies only exercise property
ownership functions and, for this reason, are not classified as integrated groups of activities
or assets. These companies were consolidated as of the acquisition date in accordance with
IFRS 3.2(b) and IAS 27 and deconsolidated as of the date on which control ceases to exist.
In 2010 all acquisitions of property project companies, with the exception of the ECO Group,
represented the purchase of individual assets by conwert and were not considered business combinations
in the sense of IFRS 3.
2.3.2. CONSOLIDATION RANGE
The consolidated financial statements include conwert Immobilien Invest SE as well as the subsidiaries
under its control. Subsidiaries are fully consolidated beginning on the date of acquisition,
i.e. the date on which the conwert Group obtains control. Consolidation ends as soon as the parent
company loses control.
A total of 109 domestic (2010: 87) and 159 foreign (2010: 144) companies were included through
full or proportionate consolidation. An overview of the companies in the conwert Group is provided
under note 16.
2.3.3. CONSOLIDATION DATE
In accordance with the principle of a uniform balance sheet date, the consolidated financial statements
are prepared as of the same balance sheet date as the financial statements of the parent
company, conwert. The individual financial statements of all companies included in the consolidation
were prepared as of the balance sheet date used for the consolidated financial statements or
interim financial statements were prepared.
2.3.4. CONSOLIDATION METHODS
All transactions – receivables and liabilities, revenues, other income and expenses – between companies
included through full or proportionate consolidation were eliminated.
For each business combination, the acquirer measures the interest in the acquired company,
excluding non-controlling interests, at fair value or at the proportionate share of the identifiable
net assets in the acquired company. Furthermore, a proportionate share of profit or loss is also
attributed to the non-controlling interests. Non-controlling interests are presented separately on
the consolidated income statement and the consolidated balance sheet. On the consolidated balance
sheet, non-controlling interests are reported under equity, but presented separately from
the equity attributable to the equity holders of the parent. Any change in an investment in a subsidiary
that does not lead to the loss of control, is accounted for as a transaction with owners in their
capacity as owners. Therefore, these transactions cannot lead to the recognition of goodwill or a
gain or loss. Differences between the consideration received and the carrying amount of the noncontrolling
interests are consequently recognised directly in equity.
The conwert Group is a partner in various joint ventures. A joint venture is defined as a contractual
arrangement between two or more parties to undertake an economic activity that is subject to joint
control. A joint venture is created by the founding of an independent entity, in which each partner
holds an investment. Shares in joint ventures are included in the financial statements through proportionate
consolidation, whereby the appropriate percentage of the assets, liabilities, income and
expenses of the joint venture are combined with the respective items in the consolidated financial
statements. The financial statements of joint ventures are prepared on the basis of consistent
accounting and valuation methods as of the same balance sheet date as the financial statements
of the parent company.