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METRO GROUP : ANNUAL REPORT 2010 : BUSINESS
→ NOTES : NOTES TO ThE GROuP ACCOuNTING PRINCIPlES ANd METhOdS
According to IAS 37, such liabilities should not be recognised
in the balance sheet but disclosed in the notes.
Accounting for derivative financial instruments/hedge
accounting
Derivative financial instruments are exclusively used to
reduce risks, in accordance with the respective Group
guideline.
In accordance with IAS 39, all derivative financial instruments
are recognised at fair value and shown under other
receivables and assets or other liabilities.
derivative financial instruments are measured on the basis
of interbank terms and conditions, possibly including the
credit margin or stock exchange price applicable to
METRO GROuP. The bid and ask prices at the balance sheet
date are applied. Where no stock exchange prices are used,
the fair value is determined by means of acknowledged
measurement methods. The recognised fair values correspond
to the amounts for which an asset could be exchanged,
or a liability settled, between knowledgeable, willing parties
in an arm’s-length agreement.
Gains and losses from derivative financial instruments designated
as qualified hedges in the framework of a fair value
hedge or for which a qualified hedge relationship could not
be established in accordance with the provisions of IAS 39
and which, accordingly, did not qualify for hedge accounting
are recognised through profit or loss. Results from derivative
financial instruments for which a cash flow hedge has
been formed and whose effectiveness has been established
are carried in equity without being reported as a profit or
loss up to the date of realisation of the hedge transaction.
Any potential changes in results due to the ineffectiveness
of these financial instruments are recognised in the income
statement and immediately reported as a profit or loss.
Accounting for share-based remuneration
The share bonuses granted under the share-based remuneration
system are classified as “cash-settled sharebased
remuneration”. Proportionate provisions measured
at the fair value of the obligations entered are formed for
these payments. The proportionate formation of the provi-
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sions is prorated over the underlying blocking period and
recognised in income as personnel expenses. To the extent
that the granted share-based payments are hedged, the
corresponding hedging transactions are recognised at fair
value and included under other receivables and assets. The
portion of the hedges’ value fluctuation that corresponds to
the value fluctuation of the share-based payments is recognised
in personnel expenses. The surplus amount of value
fluctuations is recognised in equity without being reported
as a profit or loss.
Accounting for non-current assets held for sale and
discontinued operations
In accordance with IfRS 5 (Non-current Assets held for Sale
and discontinued Operations), a non-current asset is classified
as “held for sale” if the respective carrying amount is
to be realised above all through a sale rather than through
continued utilisation. A sale must be planned and realisable
within the subsequent twelve months. The asset is measured
at the lower of carrying amount and fair value less
costs to sell and presented separately in the balance sheet.
In accordance with IfRS 5, a component of an entity is classified
as a discontinued operation if it is held for sale or has
already been disposed of. The discontinued operation is
measured at the lower of carrying amount and fair value
less costs to sell. discontinued operations are presented
separately in the income statement, the balance sheet, the
cash flow statement and the segment reporting, and
explained in the notes. With the exception of the balance
sheet, prior-year amounts are restated accordingly.