Annual Report 2009/10 Excellence in Retailing - Douglas Holding

Financial assets denominated in a foreign currency are translated to the functional
currency at the date of acquisition. An adjustment is then made to the respective closing
rate on each balance sheet date and recognized to profit or loss. Interest income and expense
are matched to the period in the financial result.
Deferred taxes
Deferred taxes are identified using the liability method based on the requirements of
IAS 12. Deferred taxes are thus recognized for temporary differences between the carrying
amounts in the consolidated financial statements and the tax base to the extent that
these differences will lead to tax refunds or charges in future. Deferred taxes are measured
taking into account the tax rates and tax regulations that have been enacted on the balance
sheet date or which are expected to be enacted when the differences are reversed.
Deferred tax assets are only recognized to the extent that there is taxable income on the
date the difference is reversed against which the difference can be offset.
If the future tax advantage from loss carryforwards can be used with sufficient certainty
in future periods, deferred tax assets are capitalized. Deferred tax assets and liabilities
are netted to the extent that the tax claims and tax liabilities are for the same
tax authority.
Inventories
As a rule, merchandise is recognized at the lower of cost and net realizable value. In
individual areas, acquisition costs are identified using the retail method based on the selling
price using reasonable valuation allowance deductions. The net realizable value is the
estimated selling price in the ordinary course of business less the estimated costs necessary
to make the sale. Selling as well as fashion and other risks were taken into account,
to the extent needed, as part of measurement at the net realizable value. Raw materials,
consumables and supplies are recognized at their acquisition costs.
Receivables and other financial assets
Trade accounts receivable and other financial assets are capitalized at amortized cost
at the time of revenue recognition. Recognizable risks are taken into account via writedowns.
A major portion of receivables that is more than 60 days overdue is transferred to
a collection agency and written-down in this connection. Write-downs are in part conducted
by using bad debt accounts. Receivables and other assets are generally derecognized
when they are settled.
Securities
Securities are carried at their Fair Value according to the requirements of IAS 39. As
a result, the Fair Value is adjusted and reflected directly in equity via a separate equity
component, as securities have been classified to the “available for sale” category. Securities
are generally initially recognized at the trade date.
Cash and cash equivalents
Cash and cash equivalents, which include money accounts and short term money deposits
with banks, are stated at amortized cost.
Financial statements
Facts & figures
Consolidated income statement
Consolidated balance sheet
Statement of changes in Group equity
Segment reporting
Consolidated Cash Flow statement
Notes
Notes to the income statement
Notes to the balance sheet
Auditor’s report
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