CG malls europe - Commerz Real

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Commerz Real Estate Master FCP – SIF
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
AS AT DECEMBER 31, 2009
1. General information and current operating environment (continued)
Impact on tenants and other debtors
Tenants and debtors of the Fund may be affected by the lower liquidity situation which could in turn impact their ability
to pay/repay the amounts owed.
Deteriorating operating conditions for tenants and other debtors may also have an impact on management’s cash flow
forecasts and assessment of the impairment of assets. To the extent that information is available, management has properly
reflected revised estimates for future cash flows in its impairment assessments.
Valuation of investment properties
For many types of real estate the markets in Portugal and Spain have been severely affected by the recent volatility in
global financial markets. As such the carrying values of investment properties measured at fair value in accordance
with IAS 40 have been updated to reflect market conditions at the reporting date.
2. Significant accounting policies
The principal accounting policies adopted in the preparation of these consolidated financial statements are set out
below. These policies have been consistently applied to all the years presented, unless otherwise stated.
2.1. Basis of preparation
The consolidated financial statements of the Fund have been prepared in accordance with International Financial
Reporting Standards as adopted by the European Union (“IFRS”). The consolidated financial statements have been
prepared under the historical cost convention modified for the revaluation of investment properties, financial assets and
financial liabilities at fair value through profit or loss.
The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates.
It also requires management to exercise its judgement in the process of applying the group’s accounting policies.
Consolidated statements of comprehensive income and cash flows
The Fund presents the consolidated statement of comprehensive income by nature of expense.
The Fund reports cash flows from operating activities using the indirect method.
The acquisitions of investment properties are disclosed as cash flows from investing activities because this most appropriately
reflects the Funds business activities.
Cash flows from investing and financing activities are determined using the direct method.