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METRO GROUP : ANNUAL REPORT 2010 : BUSINESS
→ NOTES : NOTES TO ThE GROuP ACCOuNTING PRINCIPlES ANd METhOdS
combinations occurring in financial years starting on or
after 1 July 2009. As a result, METRO GROuP had to apply
these revised standards for the first time to business combinations
in the financial year 2010.
With respect to the accounting treatment of the goodwill
resulting from a business combination, an option was introduced
giving companies a choice to also recognise goodwill
attributable to non-controlling interests (new term for
minority interests). This full goodwill method has a consequential
effect resulting in a higher share of “non-controlling
interests” in “equity”. As METRO GROuP does not make
use of this option, goodwill continued to be measured at its
proportionate interest.
under the previous IfRS 3, costs that were directly attributable
to the corporate acquisition, such as notary and consultancy
fees, were included in the cost of acquisition. Starting
in the financial year 2010, all acquisition-related costs
arising in the context of a business combination must be
recognised directly in expenses.
With respect to step acquisitions, starting from the financial
year 2010, the equity interests held at the date that control
is achieved must be remeasured, with any gain recognised
in profit or loss. Any differences between the previous carrying
amount of the interests in the subsidiary and the proportionate
remeasured net assets of the subsidiary must be
recognised as goodwill. No step acquisitions occurred in the
financial year 2010.
Any contingent consideration arrangements agreed as part
of a corporate acquisition must be measured at fair value at
the acquisition date and, in accordance with the terms and
conditions of the contract, recognised as assets, liabilities
or equity. In contrast to the previous standards, any subsequent
adjustments of goodwill following changes in the purchase
price in subsequent periods due to future events (for
example, the achievement of a sales target) are no longer
allowed.
The revised IAS 27 requires changes in subsidiary equity
interests to be accounted for as equity transactions outside
of profit or loss as long as they do not result in a loss of
control. In case of a loss of control, however, the assets and
liabilities of the former subsidiary are fully derecognised.
Any remaining interests are recognised at fair value, with
the difference from the previously recognised carrying
amounts recognised in profit or loss.
The negative balance of non-controlling interests that
become negative as a result of losses must be disclosed
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openly in equity. These were previously netted against the
majority equity.
The amendments to IfRS 3 and IAS 27 had no material effect
on the consolidated financial statements of METRO AG.
IFRS 5 (Non-current Assets Held for Sale and Discontinued
Operations) in conjunction with IFRS 1 (First-time Adoption
of International Financial Reporting Standards)
With regards to subsidiaries classified as “held for sale” in
which the entity maintains a non-controlling interest after
the divestment, the previous standard provided for the
option of classifying as “held for sale” only the proportionate
portion of the subsidiary’s assets and liabilities. The
“Improvements to IfRSs 2008” clarify that the subsidiary’s
assets and liabilities must be fully classified as “held for
sale” even if the former parent maintains a non-controlling
interest in the subsidiary.
As a result of these amendments, IfRS 1 was revised to
require first-time adopters of IfRS to also fulfil this requirement.
The amendments to IfRS 5 had no effect on the consolidated
financial statements of METRO AG.
IAS 17 (Leases)
IAS 17 was revised in connection with the “Improvements to
IfRSs 2009”. In the process, the previous regulation whereby
land lease relationships must principally be treated as
operating leases if ownership of the leased object is not
transferred to the lessee after the end of the lease term was
abandoned. Starting in the financial year 2010, all land lease
relationships must be treated analogously to other lease
objects and classified as finance leases or operating leases.
This also applies to existing lease relationships.
land lease relationships of METRO GROuP were reclassified
in the first quarter of 2010 based on data as of 1 January 2010
using the transition regulation. landed property that was
reclassified as finance leases exclusively concerned leasing
agreements with very long terms. The reclassification
resulted in a recognition of assets under “tangible assets”
amounting to €67 million and a decline in “other receivables
and assets” by €23 million due to the dissolution of
accrual items for prepaid leases. Additional liabilities
totalling €72 million were disclosed in “financial liabilities”.
The difference between assets and liabilities amounting
to €–28 million was offset in “reserves retained from
earnings”.