IC Companys – Annual Report 2008/09 0 - IC Companys A/S

Cash flow statement
The cash flow statement shows the Group’s and the Parent Company’s cash flows for the year, broken down by
operating, investing and financing activities, and the year's changes in cash and cash equivalents as well as the
Group’s cash and cash equivalents at the beginning and end of the year.
The cash flow statement shows cash flows from operating activities indirectly, based on the operating profit.
The cash flow from operating activities is calculated as the Group’s share of results adjusted for non-cash operating
items, the cash effect of special items, provisions, financial items paid, movements in working capital and
income tax paid.
The working capital comprises current assets, excluding cash items or items attributable to the investing activity,
less current liabilities excluding bank loans, mortgages and income tax payable.
The cash flow from investing activities includes payments regarding the purchase and sale of non-current assets
and securities, including investments in companies.
The cash flow from financing activities includes payments to and from shareholders, mortgage loans raised and
instalments thereon and other non-current liabilities not included in working capital.
Cash and cash equivalents comprise cash and net short-term bank loans and overdrafts that are an integral part
of the Group's cash management.
Segment information
The Group’s primary segment is the business segment “fashion wear”. The secondary segment is the Group’s geographical
markets. Segments are based on the Group's risks and managerial and internal financial management.
Segment information for the secondary segment is otherwise disclosed in accordance with the Group's accounting
policies. Segment assets are those operating assets that are employed by a segment in its operating activity
and that are either directly attributable or can be allocated to the segment on a reasonable basis.
Financial highlights and key ratios
The key ratios have been calculated in accordance with “Recommendations and Financial Ratios 2005" issued by
the Danish Association of Financial Analysts. The definitions of the key ratios used are shown on page 89.
Capital employed, including goodwill, is defined as net working capital (NWC) plus property, plant and equipment
and intangible assets, including goodwill, and less other provisions and other long-term operating commitments.
Goodwill is recognised at cost less goodwill impairment.
Net working capital (NWC) is defined as inventories, receivables and other current operating assets less trade
payables and other liabilities and other current operating liabilities.
Earnings per share and diluted earnings per share are calculated as specified in note 10.
2. Accounting estimates and judgements
The calculation of the future 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 balance sheet date. Estimates material to the financial
reporting are made in the calculation of depreciations, amortisations and impairment write-downs, the
measurement of inventories and receivables, tax assets, pensions 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 financial statements, the measurement of inventories
could be materially affected by significant changes in estimates and assumptions underlying the calculation of
inventory write-downs. Similarly, the measurement of goodwill could be affected by significant changes in estimates
and assumptions underlying the calculation of values. See note 12 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.
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