Annual report 2005 - Sava dd

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Explanation of the adjustments in the consolidated
balance sheet
Property plant and equipment is reduced by investment
property that according to Slovene Accounting
Standards was classified as fixed assets.
At 31 December 2003 the capitalised cost of
organisation incurred by the enterprises in the Sava
Group were recognised as intangible assets in the
amount of 810,030,000 tolars. These were in major part
(98%) due to the opening of new OBI stores. The
amount cannot be recognised according to IFRS, so it
was derecognised, and thus reducing retained earnings.
For the same reason, in 2004 capitalised cost of
organisation incurred by the enterprises was not
recognised in the amount of 15,626,000 tolars, which
reduces the income according to IFRSs. Due to
derecognition of these costs the amortisation totalling
122,347,000 tolars referring to these costs could not be
recognised. The total adjustment amount increases the
income for 2004 by 106,721,000 tolars.
Intangible assets were reduced due to derecognition of
goodwill in the amount of 640,275,000 tolars, a transfer
of leasehold improvements to property, plant and
equipment (30,195,000 tolars at 1 January 2004,
365,136,000 tolars at 31 December 2004), and a transfer
of advance payments for intangible assets to receivables
(23,616,000 tolars at 1 January 2004, 976,000 tolars at
31 December 2004).
According to Slovene Accounting Standards the Sava
Group companies did not present separately any
investment property. In certain companies investment
property was included in fixed assets, whereas in other
companies in non-current financial investments. At 1
January 2004 investment property was transferred from
assets and non-current financial investments. Their
value at 1 January 2004 totalled 2,706,700,000 tolars,
whereas at 31 December 2004 they totalled
2,337,783,000 tolars.
In accordance with Slovene Accounting Standards
treasury shares were presented under non-current
financial investments. Consistent with IFRSs they were
transferred directly to equity at 1 January 2004.
According to Slovene Accounting Standards investments
in associates were measured at cost until 2003, while the
profit was recognised as it was paid out. In 2004 the
accounting policy was changed and the investment was
increased by the total attributable profits for 2004, which
was recognised in the equity. Adjustments at 1 January
2004 amounting to 6,451,627,000 tolars represent the
attributable profits from previous years less received
dividends as of the year the company became an
associate until the year 2003. These profits were added to
the retained earnings. Adjustments in 2004 amounting to
547,260,000 tolars represent the received dividends in
2004, since the investment according to SAS was
increased by the total attributable profit.
Consistent with Slovene Accounting Standards the
majority of securities was presented as current financial
investments irrespective of their actual purpose.
Consistent with IFRSs and in accordance with the
company policy they are all classified as available for
sale and presented among non-current assets.
Non-current securities are investments in equity
securities of companies that are listed on the Stock
Exchange as well as other companies. These shares are
the financial potential of the parent company that in the
future will be invested in accordance with the Group's
business strategy. Therefore they are classified as
available for sale. Consistent with Slovene Accounting
Standards investments in shares of listed companies
were valued at cost which could not exceed the Stock
Exchange price on the balance sheet date. In accordance
with IFRSs their value was adjusted to the quoted
market price on the balance sheet date. The adjustment
effect increases the fair value reserve (as the part of the
equity) at 1 January 2004 by 5,601,095,000 tolars, and
at 31 December 2004 by an additional 4,927,790,000
tolars. The fair value adjustment of listed shares
amounts to 10,528,885,000 tolars at 31 December 2004.
The fair value reserve is reduced by deferred tax
liabilities amounting to 2,632,221,000 tolars. Shares and
interests in companies that are not listed on the Stock