Annual Report 2010 - CDON Group

62 CDON Group AB
Annual Årsredovisning report 2010 2010
2.21 Parent company accounting policies
The parent company prepared its annual accounts as per the Swedish Annual Accounts Act (1995:1554) and Recommendation RFR 2
Accounting for Legal Entities (December 2010) of the Swedish Financial Reporting Board. The Swedish Financial Reporting Board’s
statement on listed companies is also applied. RFR 2 means that, in the annual report for the legal entity, the parent company must
apply all EU-approved IFRS and interpretations as far as possible within the framework of the Annual Accounts Act and the Act on
Safeguarding of Pension Commitments, and with regard to the connection between accounting and taxation. The recommendation
states which exceptions from and additions to IFRS must be applied.
2.21.1 Differences between accounting policies of the Group and parent company
The differences between Group and parent company accounting policies are stated below. The parent company’s accounting
policies described below were applied consistently to all periods reported in the parent company’s financial statements.
2.21.1.1 Changes to accounting policies
Unless otherwise indicated below, changes to the parent company’s accounting policies in 2010 were the same as stated above for
the Group.
The changed accounting policies for the revised IFRS 3 Business Combinations and amended IAS 27 Consolidated Accounts and
separate financial statements that are used in the Group are not applicable to the parent company as regards transaction fees and
contingent considerations. More information is available below in the Subsidiaries section.
2.21.1.2 Classification and presentation
The parent company uses the names Balance Sheet and Cash Flow Statement for the reports that in the Group are called
Consolidated Statement of Financial Position and Consolidated Statement of Cash Flows. The parent company’s income statement
and balance sheet are prepared in accordance with the Swedish Annual Accounts Act’s schedule, while the statement of
comprehensive income, statement of changes in equity, and cash flow statement are based on IAS 1 Presentation of Financial
Statements and IAS 7 Statement of Cash Flows. The differences in parent company reporting versus Group reporting as seen in the
parent company income statement and balance sheet mainly comprise reporting of financial income and expenses, equity, and the
occurrence of provisions as a separate heading in the balance sheet.
2.21.1.3 Subsidiaries
Participations in subsidiaries are recognised in the parent company using the cost method. This means that transaction costs are
included in the carrying amount for holdings in subsidiaries. In the consolidated accounts, transaction costs related to subsidiaries
are recognised directly in earnings when they arise.
Contingent considerations are valued based on the probability that the purchase price will be payable. Any changes to the
provision/receivable increases/decreases the cost. In the consolidated accounts, contingent considerations are recognised at fair
value with changes in value via earnings.
2.21.1.4 Group contributions and shareholder contributions for legal entities
The Company reports Group contributions and shareholder contributions per the Swedish Financial Reporting Board’s UFR 2
statement. Shareholder contributions are recognised directly in the equity of the recipient and are capitalised in shares and
participating interests of the issuer, to the extent impairment is not applicable. Group contributions are recognised according to
financial implications. This means that Group contributions made and received with the objective of minimising total Group tax are
recognised directly against retained profits after deduction for its actual tax effect.