Untitled - Saxo World

NOTES to the financial statements1 Accounting Policies · continuedlifetime of the transactions. Dividends, fees and othercommission revenue are recognised as income when received.Received and paid fees and commissions result from tradingwith equities, derivative financial instruments andfrom investment management.Net interest, fees and exchange rate revenues are not separatedon markets geographically, as markets do not vary.BALANCE SHEETReceivables from credit institutions and centralbanksReceivables from credit institutions and central banks aremeasured at amortised cost less provisions for impairmentas described under loans and advances.Loans and advancesLoans and advances are measured at amortised cost lessprovisions for impairment.If objective evidence exists of impairment of a loan or anadvance, then the relevant loan or advance is tested forimpairment.Impairment exists if the carrying amount exceeds thepresent value of the expected future payment on the loanor advance. The impairment is calculated based on an individualassessment of the present weighted value of themost likely future cash flows from the underlying receivable.The impairment charge is adjusted if the present valueof the expected future cash flows is changed.SubsidiariesSubsidiaries are recognised and measured in accordancewith the equity method, calculated in accordance with theGroup’s accounting policies. Consequently, the net revaluationis recognised as an Equity method reserve in equity.Acquired subsidiaries are included in the financial statementson the date of acquisition.The purchase method is applied when acquiring new subsidiaries,according to which the net assets acquired (assets,including identifiable intangible assets less liabilitiesand contingent liabilities), are stated at their fair value onthe acquisition date.AssociatesAssociates are businesses in which the Group has holdingsand significant influence but not control. The Group classifiesundertakings as associates if Saxo Bank A/S directlyor indirectly holds 20-50% of the voting rights.Associates are recognised at cost on the date of acquisitionand are subsequently measured according to the equitymethod. The proportionate share of the net profit orloss, net of tax of the individual associate is included in Incomefrom associates.Intangible and tangible assetsIntangible and tangible assets are recognised at cost lessany accumulated depreciation, amortisation and writedown.Goodwill arises on the acquisition of subsidiaries and associatesand is calculated as the difference between thecost of acquisition and the fair value of the net assets, includingcontingent liabilities, at the time of acquisition.Goodwill is recognised in the functional currency of theundertaking acquired. Goodwill on associates is recognisedunder Investments in associates.The costs of in-house software development, which areclearly defined and identifiable, are recognised as intangibleassets when it is probable, that it will provide futureeconomic benefits.When acquiring customer related contracts the fair valueof these contracts is recognised as customer related intan-ANNUAL REPORT 2009 · SAXO BANK · 49