Catom Annual Report 2020 EN

Realisation of the revaluation reserve takes place through use (depreciation) and/or disposal of the asset. The realised portion of revaluations is reclassified to other reserves.

Depreciation is based on the expected useful life of the asset, taking into account any residual value. The straight-line method is applied for this purpose. Depreciation amounts are calculated based on a fixed percentage of the asset’s cost less any investment subsidies, taking into account its residual value.

2.6. Financial fixed assets 2.6.1. Participating interests with significant influence

Participating interests over which the company can exercise significant influence are stated from the date of their acquisition at net asset value, which is determined according to the equity method (net asset value). The difference between the cost of the participating interest and its initial valuation based on the equity method is recognised as goodwill. Cost is equal to the cost of acquisition plus any costs that are directly attributable to the acquisition of the participating interest. These participating interests are then recognised in the balance sheet according to this method, based on the share of the company in their net asset value plus its share in the results of the participating interests from the date of their acquisition. The net asset value is determined according to the accounting policies of the participating legal entity as described in the annual accounts.

The share of the company in the result of the participating interests is recognised in the profit and loss account.

If the net asset value of the participating interest is negative, it is valued at zero. Other long-term interests in the participating interest that effectively constitute part of the net investment are taken into account for this purpose. If and insofar as the company guarantees the repayment of all or part of the debts of the participating interests, or if it has a constructive obligation to enable the participating interest to repay its debts, a provision is recognised accordingly.

A subsequently acquired share in the profit of the participating interest is only recognised if and insofar as the accumulated non-recognised share in the loss has been made good.

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