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CONSOLIDATED FINANCIALSTATEMENTS
BarryCallebaut
Annual Report2010/11
Revenue recognition
Revenues from sales and services consist of the net sales turnover of semi-processed and
processed goods and services related to food processing.
Revenues from the sale of goods arerecognized when the significant risks and rewards
of ownership of the goods have been transferred to the buyer, which is mainly upon shipment.
Appropriate provisions are made for all additional costs to be incurred in connection
with the sales including the cost of returns.Additionally,gains and losses related to derivative
financial instruments used for hedging purposes are recognized in revenues in accordance
with the policies set out in this section.
Revenues and costs related to trading of raw materials, which are fair valued, are
netted. Interest income is recognized as it accrues on an effective yield basis,when it is determined
that such income will flow to the Group.Dividends are recognized when the right to
receive payment is established.
Governmentgrants
Provided thereisreasonable assurance that they will be irrevocably received, grants relating
to capital expenditureare deducted from the cost of property,plant and equipment and thus
recognized in the income statement on astraight-line basis over the useful life of the asset.
Other grants that compensate the Group for expenses incurred are deferred and
recognized in the income statement over the period necessary to match them with the costs
they areintended to compensate.
Segmentreporting
Operating segments arereported in amanner consistent with the internal reporting provided
to the Chief Operating Decision Maker.The Operating Decision Maker,who is responsible
for allocating resources and assessing performance of the operating segments, has been
identified as the Group’s Executive Committee.
Discontinued operations
Discontinued operations areseparately disclosed, if acomponent of an entity either has been
disposed of,orisclassified as,held for sale.Acomponent of an entity represents amajor line
of business or geographical area of operations or is part of asingle coordinated plan to
dispose of aseparate major line of business or geographical area of operations or is asubsidiary
acquired exclusively with aview to resale.Acomponent of an entity can be clearly
distinguished operationally and for financial reporting purposes,from the rest of the entity.
Discontinued operations are separately disclosed from the continued operations in the consolidated
income statement. Prior-year financial figures related to the income statement are
adjusted accordingly (as if the operation had been discontinued as from the start of the comparative
year) and also separately disclosed. Related assets are presented on the balance
sheet under “Assets held for sale” and related liabilities under “Liabilities directly associated
with assets held for sale”,whereas in accordance with IFRS 5,noprior-year restatement has
been made for these positions.Cash flow information related to discontinued operations are
disclosed separately in the notes.
Changes in accounting policies In line with the Group’sstrategy of increased sourcing in the
origin countries,the Group modified its accounting model used for inventory valuation. The
new accounting policy isintroduced prospectively as from fiscal year 2010/11 and prior-year
figures were not restated in accordance with IFRS. In the revised accounting model, the
broker-trader exemption is no longer applied whereas in prior year,Barry Callebaut applied
the broker-trader exemption in accordance with IAS2.5 for the Contract Business and thereforemeasured
its inventories at fair value less costs to sell. Going forward, inventories will be
measured at the lower of cost and net realizable value.The cocoa price risks related to cocoa
inventories exceeding the firm sales commitments for chocolate are hedged with cocoa
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