ANNUAL REPORT 2011/12 - IC Companys A/S

Notes to the consolidated financial statements
PAGE 65
1. Basis for preparation of consolidated financial statements
The consolidated fi nancial statements and the fi nancial statements of the Parent Company, IC Companys A/S, for the fi nancial
year 2011/12 have been prepared in accordance with the International Financial Reporting Standards (IFRS) as adopted by
the EU and additional Danish disclosure requirements for the annual reports of listed companies (accounting class D), cf. the
Statutory Order on the adoption of IFRS under the Danish Financial Statements Act.
The consolidated fi nancial statements and the fi nancial statements of the Parent Company are also prepared in accordance with
the IFRS standards as issued by the International Accounting Standards Board (IASB).
The consolidated fi nancial statements and the fi nancial statements of the Parent Company are expressed in Danish Kroner
(DKK), which is considered the primary currency of the Group’s activities and the functional currency of the Parent Company.
The accounting policies are applied consistently throughout the fi nancial year and for the comparative fi gures. Few adjustments
of the comparative fi gures have been made which have had no effect on EBIT, profi t for the year, other comprehensive income,
the fi nancial position and the equity in the comparative year.
New standards in 2011/12
Implementation of new standards and interpretations
IC Companys has adopted all new and amended standards and interpretations (IFRIC) as endorsed by the EU and which are
effective for the fi nancial year 1 July 2011 - 30 June 2012. Based on thorough analysis, IC Companys has concluded that the
standards which are effective for fi nancial years beginning on or after 1 July 2011 are either of no relevance to the Group or exert
no material impact on the fi nancial statements.
New and amended standards and interpretations not yet effective
IASB has issued a number of IFRS standards, amended standards and IFRIC interpretations which are effective for fi nancial years
beginning on or after 1 July 2012. IC Companys has thoroughly considered the impact of the IFRS standards, amended standards
and IFRIC interpretations not yet effective, and it is estimated that these standards and interpretations are deemed to exert no
material impact on the consolidated fi nancial statements or the fi nancial statements of the Parent Company in the coming years.
Please see note 32 for further information on signifi cant accounting policies.
2. Accounting estimates and assumptions
The calculation of the carrying amount of certain assets and liabilities requires an estimate of how future events will affect the
value of such assets and liabilities at the end of the reporting period. Estimates material to the fi nancial reporting are made
in connection with, e.g., the calculation of depreciation, amortisation and impairment losses, the valuation of inventories and
receivables, tax assets, goodwill and provisions.
The estimates applied are based on assumptions which Management believes to be reasonable, but which are inherently
uncertain and unpredictable. In the consolidated fi nancial statements, the measurement of inventories and receivables could be
materially affected by signifi cant changes in estimates and assumptions underlying the calculation of inventory and receivables
write-downs. Similarly, the measurement of goodwill could be affected by signifi cant changes in estimates and assumptions
underlying the calculation of values. Please see note 11 to the consolidated fi nancial statements for a more detailed description
of impairment tests for intangible assets.
The measurement of inventories is based on an individual assessment of season and age and on the realisation risk assessed
to exist for individual items.
Tax assets are written down if Management believes that it is not suffi ciently likely that the operation of an individual tax object
(company) or a group of jointly taxed companies can generate a profi t within the foreseeable future (typically 3-5 years), the
expected taxable income is insuffi cient for the tax assets to be exploited in full or there is uncertainty with respect to the value of
the tax asset at the end of the reporting period, e.g., as a result of an on-going tax audit or pending tax litigation.
3. Segment information
Business segments
Reporting to the Group’s Management is based on the Group’s two distribution channels; wholesale and retail.
Wholesale
The business segment consists of wholesale to store owners. The segment consists of sales to wholesale customers and
franchise partners and to a limited extent sourcing performed on behalf of external customers.
IC COMPANYS ANNUAL REPORT 2011/12