2012 Annual Report - Italcementi Group

1.3. Basis of consolidation
The consolidated financial statements are based on the financial statements as at and for the year ended
December 31, 2012, of the parent Italcementi S.p.A. and the consolidated companies. Where necessary, the
financial statements are adjusted to ensure alignment with the Group’s classification criteria and accounting
policies.
Subsidiaries
Subsidiaries are companies in which the Group has the power to determine, directly or indirectly,
administrative and management decisions and to obtain the benefits thereof. Generally speaking, control is
assumed to exist when the Group holds, directly or indirectly, more than one half of voting rights, including
potential voting rights deriving from convertible securities.
Subsidiaries are consolidated on a line-by-line basis as from the date at which control is obtained and until
control is transferred out of the Group.
Associates
Associates are companies in which the Group has significant influence over administrative and management
decisions even though it does not hold control. Generally speaking, significant influence is assumed to exist
when the Group holds, directly or indirectly, at least 20% of voting rights or, even if it holds a lower percentage
of voting rights, when it is entitled to take part in financial and management policy decisions by virtue of a
specific juridical status including, but not limited to, participation in shareholders’ agreements or other forms of
material exercise of rights of governance. Investments in associates are measured using the equity method,
whereby they are recognized initially at cost, and subsequently adjusted to reflect changes in the Group’s
interest in the associate’s equity. The Group’s share of an associate’s profit or loss is recognized in a specific
income statement line item from the date at which the Group exerts significant influence until it relinquishes
such influence.
Joint ventures
Joint ventures are companies whose business operations are controlled by the Group jointly with one or more
other parties, under contractual arrangements. Joint control presupposes that strategic, financial and
management decisions are taken with the unanimous consent of the parties that control the venture.
Interests in joint ventures are consolidated on a proportionate basis, whereby assets, liabilities, income and
expense are recognized proportionately to the Group’s interest.
The equity and income of joint ventures are consolidated from the date on which joint control is assumed and
until such control is relinquished.
Transactions eliminated during consolidation
All intragroup balances and transactions, including any unrealized gains in respect of third parties, are
eliminated. Unrealized losses in respect of third parties deriving from intragroup transactions are eliminated,
except in cases where it will not subsequently be possible to recover such losses.
Unrealized gains deriving from transactions with associates are eliminated against the equity investment
carrying amount, while losses are eliminated proportionately to the Group’s interest, unless it will not
subsequently be possible to recover such losses.
Scope of consolidation
A list of the companies consolidated, proportionately consolidated and with the equity method is provided in the
annex to these notes.
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