Financial statements - Mondi

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Combined and consolidated statement of changes in equity for the year ended 31 December 2010 Total Combined attributable share to equity capital and holders of Nonshare Retained Other the parent controlling Total E million premium earnings reserves 1 companies interests equity At 1 January 2009 646 1,809 (132) 2,323 373 2,696 Dividends paid – (39) – (39) (9) (48) Total comprehensive income for the year – (33) 137 104 39 143 Issue of shares under employee share schemes – 19 (19) – – – Purchases of treasury shares (see note 27) – (1) – (1) – (1) Non-controlling interests buy in – – – – 27 27 Non-controlling interests bought out – – – – (3) (3) Reclassification – (12) 15 3 (3) – Other – – 9 9 1 10 At 31 December 2009 646 1,743 10 2,399 425 2,824 Dividends paid – (54) – (54) (18) (72) Total comprehensive income for the year – 224 177 401 75 476 Issue of shares under employee share schemes – 5 (5) – – – Purchases of treasury shares (see note 27) – (2) – (2) – (2) Disposal of businesses – – 12 12 (18) (6) Non-controlling interests bought out – (1) – (1) (3) (4) Reclassification – 1 (1) – – – Other – – 8 8 – 8 At 31 December 2010 646 1,916 201 2,763 461 3,224 Note: 1 Other reserves are analysed further below. 78 Annual report and accounts 2010 Other reserves 1 Share- Cumulative Postbased translation Cash flow retirement payment adjustment hedge benefit Other E million reserve reserve reserve reserve reserves 2 Total At 1 January 2009 24 (336) (35) (36) 251 (132) Total comprehensive income for the year – 114 16 6 1 137 Mondi share schemes’ charge 8 – – – – 8 Issue of shares under employee share schemes (19) – – – – (19) Non-controlling put option issued – – – – 1 1 Reclassification – – – 2 13 15 At 31 December 2009 13 (222) (19) (28) 266 10 Total comprehensive income for the year – 180 9 (12) – 177 Mondi share schemes’ charge 8 – – – – 8 Issue of shares under employee share schemes (5) – – – – (5) Disposal of businesses – 12 – – – 12 Reclassification 1 (1) – – (1) (1) At 31 December 2010 17 (31) (10) (40) 265 201 Notes: 1 All movements in other reserves are disclosed net of non-controlling interests. The movements in non-controlling interests as a direct result of the movements in other reserves for the year ended 31 December 2010 are as follows – increase in non-controlling interests related to total comprehensive income for the year of E14 million (2009: E9 million). 2 Other reserves consist of the merger reserve of E259 million (2009: E259 million) and other sundry reserves of E6 million (2009: E7 million).
Notes to the combined and consolidated financial statements for the year ended 31 December 2010 1 Accounting policies Basis of preparation The Group’s combined and consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB). The Group has also complied with South African Statements and Interpretations of Statements of Generally Accepted Accounting Practice. There are no differences for the Group in applying IFRS as issued by the IASB and IFRS as adopted by the European Union (EU) and therefore the Group also complies with Article 4 of the EU IAS Regulation. The combined and consolidated financial statements have been prepared on a going concern basis as discussed in the business review, under the heading ‘Going concern’. The financial statements have been prepared on the historical cost basis, except for the revaluation of certain properties and financial instruments. Historical cost is generally based on the fair value of the consideration given in exchange for assets. The principal accounting policies adopted are set out below. Basis of consolidation Dual listed structure The Group has two separate legal parent entities, Mondi Limited and Mondi plc, which operate under a dual listed company (DLC) structure. The substance of the DLC structure is such that Mondi Limited, and its subsidiaries, and Mondi plc and its subsidiaries, operate together as a single economic entity through a sharing agreement, with neither parent entity assuming a dominant role. Accordingly, Mondi Limited and Mondi plc are reported on a combined and consolidated basis as a single reporting entity under IFRS. Subsidiary undertakings The combined and consolidated financial statements incorporate the assets, liabilities, equity, revenues, expenses and cash flows of Mondi Limited and Mondi plc, and of their respective subsidiary undertakings drawn up to 31 December each year. All intra-group balances, transactions, income and expenses are eliminated. Subsidiary undertakings are those entities over which the Group has the power, directly or indirectly, to govern operating and financial policy in order to obtain economic benefits. The results of subsidiaries acquired or disposed of during the years presented are included in the combined and consolidated income statement from the effective date of acquiring control or up to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the results of subsidiaries to bring their accounting policies into alignment with those used by the Group. The interest of non-controlling interests is measured, at initial recognition, as the non-controlling proportion of the fair values of the assets and liabilities recognised at acquisition, except for those instances where the Group elects to measure the non-controlling interests at fair value in accordance with the allowance provided in IFRS 3, ‘Business Combinations’ (revised). After initial recognition non-controlling interests are measured as the aggregate of the value at initial recognition and their subsequent proportionate share of profits and losses. Associates Associates are investments over which the Group is in a position to exercise significant influence, but not control or joint control, through participation in the financial and operating policy decisions of the investee. Typically, the Group owns between 20% and 50% of the voting equity of its associates. Investments in associates are accounted for using the equity method of accounting except when classified as held for sale. The Group’s share of associates’ net income, presented net of tax, is based on financial statements drawn up to reporting dates that are either coterminous with that of the Group or no more than three months prior to that date. Where reporting dates are not coterminous, adjustments are made to the associate’s net income for the effects of significant transactions or events that occur after the associate’s reporting date up to the reporting date of the Group. The total carrying values of investments in associates represent the cost of each investment including the carrying value of goodwill, the share of post-acquisition retained earnings, any other movements in reserves and any long-term debt interests which in substance form part of the Group’s net investment in that entity. The carrying values of associates are reviewed on a regular basis and if an impairment has occurred, it is written off in the year in which those circumstances arose. The Group’s share of an associate’s losses in excess of its interest in that associate is not recognised unless the Group has an obligation to fund such losses. Mondi Group 79 Financial statements
Page 1 and 2: Contents Financial statements and s
Page 3 and 4: Independent auditors’ report to t
Page 5 and 6: Matters on which we are required to
Page 7 and 8: Combined and consolidated statement
Page 9: Combined and consolidated statement
Page 13 and 14: 1 Accounting policies (continued) I
Page 15 and 16: 1 Accounting policies (continued) D
Page 17 and 18: 1 Accounting policies (continued) T
Page 19 and 20: 1 Accounting policies (continued) E
Page 21 and 22: 1 Accounting policies (continued) S
Page 23 and 24: 2 Operating segments (continued) Me
Page 25 and 26: 2 Operating segments (continued) Ex
Page 27 and 28: 2 Operating segments (continued) Op
Page 29 and 30: 2 Operating segments (continued) Ad
Page 31 and 32: 4 Employee numbers and costs (conti
Page 33 and 34: 5 Special items (continued) Year en
Page 35 and 36: 8 Tax charge (a) Analysis of charge
Page 37 and 38: 10 Dividends Dividends paid to the
Page 39 and 40: 11 Intangible assets (continued) Th
Page 41 and 42: 13 Forestry assets E million 2010 2
Page 43 and 44: 16 Financial asset investments (con
Page 45 and 46: 19 Trade and other payables E milli
Page 47 and 48: 20 Borrowings (continued) Non-inter
Page 49 and 50: 21 Derivative financial instruments
Page 51 and 52: 23 Deferred tax (continued) Deferre
Page 53 and 54: 24 Retirement benefits (continued)
Page 59 and 60: 27 Share capital and share premium
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28 Share-based payments (continued)
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29 Business combinations (continued
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31 Disposal groups and assets held
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33 Capital commitments E million 20
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37 Financial risk management (conti
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38 Related party transactions (cont
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Mondi plc parent company balance sh
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1 Accounting policies (continued) B
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8 Reconciliation of shareholders’
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Mondi Limited parent company statem
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3 Investment in joint venture R mil
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Group financial record Financial pe
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Production statistics Production st
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Financial statements - Mondi

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