ifrs update 2019 - deloitte united statesifrs 16 –related tax issues deferred tax related to...

IFRS Update 2019

Latest trends and experiences within IFRS

October 2019

2© Deloitte 2019

Assurance OfferingsServices

Disruptive events – Exit readiness

and IPO assistance

Proces optimisation –financial processes

ERP support –Microsoft

Pension management services

Corporate Governance

Accounting Advisory,IFRS and DK GAAP

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IFRS 16

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Trends and experiences

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Trends and experiences

How did it go with the implementation? Impact of IFRS 16 and Disclosures in the Financial statementsWe have not yet seen a clear trend in how the companies will address IFRS 16 in their financials statements.

Administration burdenThe trend in the market is that IFRS 16 is handled centrally and handled as a group adjustment to the monthly reporting and not implemented in the daily bookkeeping due to the administrative burden and lack of supporting systems and processes.

Real economic effectsWe see clients shifting their focus from compliance with IFRS 16 to strategic optimisation of their lease portfolio in an IFRS 16 world. However, we also see that they are facing problems in terms of dealing with banks and other investors.

Complexity of contracts Even though most of our clients’ preliminary assessment indicated that their lease portfolio was quite simple and straightforward, it seems that most companies are surprised by the complexity of IFRS 16 and they still struggle to find the right level.

How and when to address modifications? We experience that many companies struggle a bit with how to handle modifications and when to apply these?

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Modifications and practical complexities

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Six key observations – how do you address these?

Extending the term of a lease to which the § C10(c) practical expedient was appliedWhat processes have you put into practice to make sure that modifications of short-term leases are completely identified?

02

01Exercising an extension optionWhat processes have you put into practice to make sure that you evaluate on the extension options? And do you address them at the right level? 04

03

05

06

Extending a lease; when should the additional RoU asset and lease liability be recognised?Is an extension of lease term identified as a modification by your system or other processes? At what date does your system recognise the additional RoU asset and lease liability?

Leases with no end date (rolling contracts)What processes have you put into practice to make sure the right end date is set? How do you apply the “reasonable certain to exercise” assessment and revisit hereof? And is your system/tool supporting this?

Extension via a new contractHow do your existing processes identify new leases that should be accounted for as a modification?

Both parties have an option to terminate the lease – no penalty; termination option can be exercised at any time after one yearHave you considered all relevant factors such as “§ 61-62 of the Business Rent Act” in Denmark or other local factors throughout the group?

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IFRS 16’s lease modification guidance diagram:

Changes that are not part of the original terms of the lease

Change in scopeChange in

consideration

Adding assetsRemoving

assets

Extending

lease term

Shortening

lease term

At standalone

price

Not at

standalone

price

Separate

lease

Not a separate lease

Account for at effective date of modification

The legal or contractual labelling of the modification is not relevant in the assessment of whether the modification is a separate lease

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Accounting and disclosure considerations

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IFRS 16 general requirements for impairment tests of the RoU

Definition

“A lessee shall apply IAS 36 Impairment of Assets to determine whether the RoU is impaired and to account for any impairment loss identified” (IFRS 16.33)

At which level shall the RoU be tested for impairment?

Which consequences of IFRS 16 on the determination of

• The carrying amount of the RoU’s CGU?

• Value in use (VIU)?

• Fair value less costs to sale (FVLCTS)?

• The discount rate?

What are the practical consequences and common pitfalls?

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How to determine VIU?

“Estimates of future cash flows shall not include cash inflows or outflows from financing activities” (IAS 36.43(b))

Estimated cash outflows over the projection period should exclude lease payments for those reflected in the lease liability but should include those relating to

• Variable lease payments

• Lease payments related to short-term and low value leases

• Lease renewals if the lease term is shorter than the projection period

• Projected effects of indexation/future readjustments of RoU based on an index or a rate, as they are not included in the lease liability

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Wrap-up

Pre IFRS 16 implementation impairment tests models are not IFRS compliant anymore

The lease liability is a financial liability regardless of where it is presented in the BS or how it is labelled

Lease payments are a repayment of the financial liability, and thus shall not be included in the measurement of VIU

As per IAS 36.78, the lessee may choose to include the lease liability carrying amount in the CGU carrying amount

If so, in application of the May 2016 IFRS IC agenda decision, the previously determined VIU shall

also be adjusted by the lease liability carrying amount

If the RoU is tested within a CGU and if CF are projected for a period longer than the lease term, cash

outflows for lease renewals shall be included in the CF projections (capex to maintain the CGU)

Lease payments excluded from the lease liability shall always be included in the measurement of the VIU (e.g. variable payments)

Impact on WACC ?

Impact on multiples used for determining FV less cost to sell?

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Accounting considerations

IFRIC discussions: Depreciation of leasehold improvements beyond enforceable period

Non-cancellable Not reasonably certain to extend

Expected

Non-cancellable

Expected + If positive economic evidence

Leasehold improvement depreciation period?

Lessor option

Leasehold improvement depreciation period?

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Tax and VAT considerations

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IFRS 16 – Related tax issues

Deferred tax related to assets and liabilities arising from a single transactionIASB Update Jan 2019 – ED to be released Q2 2019 (narrow scope amendment): Recognition of deferred tax when lessee recognises an asset and a liability at initial lease date applying IFRS 16; IRE in IAS 12:15/IAS 12:24 would be narrowed down, i.e. deferred tax would be recognised when equal amounts of taxable and deductible temporary differences arise from initial recognition of asset and liability.

01

02Danish tax rules on limited deductions of interest Interest from lease contracts to be included from the perspective of the lessor, i.e. still necessary to consider operating vs finance lease for tax purposes similar to IAS 17.

03VATIf an amount is collected by lessor on behalf of the tax authorities, the VAT does not 'relate to the right to use the underlying asset'. Therefore, it does not form part of either 'lease payments' or 'variable lease payments' as defined in Appendix A to IFRS 16 (for either lessee A or lessor B) and is not a cost to be included in the consideration for the contract under IFRS 16:B33. This is consistent with the treatment of such taxes under IFRS 15:47.

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Presentation and Disclosure

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In the notes

Presentation and disclosure - Lessee

Investment property leases

Revalued RoU

assets (IAS 16)

Lease liabilities

Financial information• Depreciation by class, interest expense • Low-value or short-term lease expenses (not<1 month)• Variable lease payments• Income from subleases• Total cash flow• RoU asset: Additions, carrying amount at the end of

reporting period• Gain or losses on sale and leasebacks• Fact: Low-value or short-term lease exemption applied

Revalued RoU asset (IAS 16)• Effective date of revaluation• Whether independent valuation expert involved

Lease liabilities • Separate IFRS 7 maturity analysis

Investment property leases • Some IAS 40 disclosures

Qualitative and quantitative disclosures, e.g.• Nature of lease activities • Exposure to possible future cash outflows not reflected in

lease liability• Restrictions or covenants imposed by leases• Sale and leaseback transactions

Single note/ separate section

Remember significant

judgements as per IAS 1

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In the notes

Presentation and disclosure - Lessor

Investment property leases

Operating lease

Lease liabilities

Finance lease• Selling profit or loss• Finance income on net investment• Income from variable lease payments not included in net

investment• Quantitative and qualitative explanation of significant

changes in net investment• Maturity analysis of lease payments receivable showing

undiscounted lease payments on an annual basis for each of the first five years and total for the remaining years

• Reconciliation of undiscounted lease payment to net investment in the lease

Operating lease• Lease income separately disclosing income relating to

variable lease payments not depending on an index or a rate• PP&E: Apply disclosure requirements in IAS 16,

disaggregating into assets subject to operating lease• Apply IAS 36, IAS 38, IAS 40 and IAS 41 to assets subject to

operating lease• Maturity analyses of lease payments, showing undiscounted

lease payments to be received on an annual basis for the first five years and total for the remaining years

Qualitative and quantitative disclosures, e.g.• Nature of lease activities • How lessor manages risks associated with rights retained in

underlying asset, including risk management strategy and means to reduce that risk

• Explanation of significant changes in carrying amount of net investment in finance leases



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Practical example – Balance sheet

NNIT A/S – 2018 Annual Report

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Practical example – Note disclosure

NNIT A/S – 2018 Annual Report

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Royal Unibrew A/S – 2018 Annual Report

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Royal Unibrew A/S – 2018 Annual Report

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Deutsche Post DHL Group – 2018 Annual Report

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IFRS 15 and 9 (7)

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IFRS 15 and 9 (7)

It is our impression that there is a need to revisit the disclosures provided

Based on national and

international reviews of

disclosures related to

IFRS 9 (7) and IFRS 15,

it is our impression that

there is a need to revisit

the disclosures in 2019.

We recommend to

initiate procedures

now to revisit

disclosure

requirements.

The Danish Business Authority

is currently in the process of

reviewing a number of annual

reports.

It is our expectation that

findings related to IFRS 9 and

15 disclosures will occur.

IFRS 15

Based on our experience, particular

attention should be drawn to the

following disclosures:

• Value of performance obligations

that are unsatisfied as of the end of

the reporting period

• Explanation of when the entity

expects to recognise as revenue the

amounts of unsatisfied performance

obligations.

IFRS 9 (7)Based on our experience, particular attention should be drawn to the following: • Impairment and expected

credit loss model• Hedge accounting

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IFRS 15Revenue from Contracts with Customers

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IFRS 15 Revenue from Contracts with Customers

Disclosures provided in 2018 annual reports for non-FSI C25 companies

8

4

5

Approach

No impact

Presentation impact only

Recognition and measurement impact

0 5 10 15

< -50m DKK

-50 - 0m DKK

0 m.DKK

0 - 50m DKK

> 50m DKK

Impact

Companies

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In the notes

Presentation and disclosure – IFRS 15

Contract balances

Performance

obligations

Remaining performance obligations

Presentation• Separate presentation of financing effects• Contract assets and liabilities• Separate presentation of return assets from refund liabilities

Performance obligations• Description of satisfaction of performance obligations• Significant payment terms• Nature of goods or services within the performance obligations• Returns, refunds, warranties and other obligations

Remaining performance obligations• Amount of transaction price allocated to performance obligations

that are unsatisfied (or partially unsatisfied) as of the end of the reporting period

• When the entity expects to recognise revenue from remaining performance obligations

Contract balances• Opening and closing balances of receivables, contract assets and

liabilities• Revenue recognised in the reporting period that was included in

the contract liability at the beginning of the period

Qualitative and quantitative disclosures, e.g.• Disaggregation of revenue into categories that depict nature,

amount, timing and uncertainty• Methods used for recognising revenue• Determination of transaction price



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IFRS 15 Revenue from Contracts with Customers

Disclosure requirements we believe particular attention should be drawn to

Disclosure requirement Example (Demant A/S, 2018 Annual Report)

An entity shall disclose the aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied (or partially unsatisfied) as of the end of the reporting period.

[IFRS:120(a)]

An entity shall disclose when the entity expects to recognise revenue amounts as disclosed in accordance with § 120(a).

[IFRS:120(b)]

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IFRS 9 Financial InstrumentsIFRS 7 Financial Instruments:Disclosures

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Changes

IFRS 9 (7)

Recap of changes

Classification and measurementNew model regarding classification and measurement for financial assets based on:• The entity’s business model• Contractual cash flow characteristics of the

individual asset

Hedge accounting• New model closely aligned hedge

accounting with risk management activities• More formalised requirements to document

risk management strategy• More eligible hedging instruments (e.g.

non-derivatives at fair value)

Impairment• Change from incurred loss model to

expected loss model means earlier recognition of expected credit losses

• 12-month or full lifetime expected losses• Full lifetime expected losses per default for

trade receivables without financing element

DisclosuresSignificant increase in disclosure requirements, particularly related to hedge accounting and credit losses

34© Deloitte 2019

IFRS 9 (7)

Disclosures provided in 2018 annual reports for non-FSI C25 companies

15

0 2

Approach

No impact

Presentation impact only

Impact on recognition and measurement

0 5 10 15 20

< -20 m DKK

-20 - 0m DKK

0 m.DKK

0 - 20m DKK

> 20m DKK

Impact

Companies

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By credit risk rating grades, the gross carrying amount shall be disclosed for the below

Impairment and expected credit loss model | IFRS 7:35M-35N

Contract balances

Life-time ECL


12 month ECL• For which the loss allowance is measured at 12-month expected credit

losses

Life-time ECLa) For which the loss allowance is measured at life-time expected credit losses

and that are:

i. Financial instruments for which credit risk has increased significantly

since initial recognition

ii. Financial assets that are credit-impaired

iii. Trade receivables, contract assets or lease receivables

Othera) Purchased or originated credit-impaired assets

For trade receivables, contract assets and lease receivables to

which the entity applies the simplified approach under IFRS

9.5.15, the above information may be based on a provision

matrix

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IFRS 9 (7)

Impairment and expected credit loss model – FLSmidth example

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IFRS 9 (7)

Impairment and expected credit loss model – DSV example

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IFRS 9 (7)

Impairment and expected credit loss model – ISS example

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IFRS 9 (7)

Impairment and expected credit loss model – ISS example (continued)

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Disclosures

Hedge accounting

Contract balances

Cash-flow

hedges


GeneralAn entity shall disclose in a tabular format the following amounts designated as hedging instruments separately by risk category for

each type of hedge:

a) The carrying amount of the hedging instruments (financial assets separately from financial liabilities)

b) The line item in the balance sheet that includes the hedging instrument

c) The change in fair value of the hedging instrument used as the basis for recognising hedge ineffectiveness for the period

d) The nominal amounts of the hedging instruments

In addition, the following amounts related to the hedged items must be disclosed in a tabular format separately by risk category for

cash flow hedges:

i. The change in value of the hedged item used as the basis for recognising hedge ineffectiveness

ii. The balance in the cash flow hedge reserve

iii. The balance remaining in the cash flow hedge reserve from any hedge relationships for which hedge accounting is no longer

applied

Cash-flow hedgesAn entity shall disclose, in a tabular format, the following amounts separately by risk category for the types of hedges as follows for

cash flow hedges:

a) Hedging gains or losses of the reporting period that were recognised in OCI

b) Hedge ineffectiveness recognised in P&L

c) Line item in comprehensive income that includes the recognised hedge ineffectiveness

d) The amount reclassified from cash flow reserve into P&L (differentiating between amounts reclassified because the cash flows

are no longer expected and amounts reclassified because the hedged item has affected P&L)

e) The line item in statement of comprehensive income that includes the reclassification adjustments

f) For hedges of net positions, the hedging gains and losses recognised in a separate line in P&L

ReconciliationAn entity shall provide a reconciliation by risk category of each component of equity and an analysis of Other comprehensive income

in accordance with IAS 1, that taken together:

a) Differentiate, at a minimum, between hedging gains and losses recognised in the hedging reserve in the period, and amounts

recycled from the hedging reserve to P&L in the period

b) Differentiates between amounts associated with time value of options that hedge transaction-related hedged items and that

hedge time period-related hedged items respectively

c) Differentiates between amounts associated with forward elements of forward contracts ant the foreign currency basis spreads

of financial instruments that hedge transaction- related hedged items, and that hedge time period-related hedged items

respectively

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IFRS 9 (7)

Hedge accounting – NKT

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IFRS 9 (7)

Hedge accounting – NKT

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iXBRL

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New

requirements

from 2020

The European Single Electronic Format (ESEF) in brief

New electronic format for annual reports for listed companies from 2020

XBRL-”tags” to be embedded in the xHTML document• The XBRL “tags” shall be made against the

ESEF XBRL taxonomy• Preparers shall mark-up items and

disclosures using the taxonomy element having the closest accounting meaning to the marked up disclosure; if the closest taxonomy element misrepresents the accounting meaning of the disclosure, issuers shall create an extension taxonomy element

• Primary financial statements shall be marked up in detail; notes will need to be marked up by applying mark-ups for whole sections of the notes (block tagging)

Submission immediately after approval by the board of directors• The xHTML document shall be submitted to

the Officially Appointed Mechanism (DK: Finanstilsynet) following the approval of the annual report for publication

Auditors report to include XBRL “tags”• The XBRL-tags are to be “audited” by the

Company’s auditor

New format xHTML– PDF is not an option• All Annual Financial Reports (AFRs) shall be

prepared and submitted in xHTML-format.• Where AFRs contains IFRS consolidated

financial statements, these shall be labelled with XBRL “tags” directly in the xHTMLdocument.

The Regulatory Technical Standards (RTS) on ESEF will apply to all issuers subject to the requirements contained in the Transparency Directive to make public Annual Financial Reports (AFRs). The new requirements apply for the 2020 AFRs.

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Filings in practice

XBRL & EU – European Single Electronic Format

Consolidated IFRS

financials

Parent company financials

Report of the Board of

Directors

Auditor’s report

Management Report

TheOfficially Appointed Mechanism (OAM) as defined by the

Transparency Directive

(Finanstilsynet)

In developmentEuropean Financial

Transparency Gateway (EFTG)

XBRL

XHTML

2020 & 2021

Detailed tagging

Each figure in the primary financial

statements (P&L, OCI, BS, CF and

Equity) is tagged with an

XBRL tag plus certain specific

information

2022

Block tagging

Notes are tagged as blocks so that

each note is associated with an

XBRL tag plus certain other

disclosures.

Consolidated IFRS financials

XHTML

XHTML

XHTML

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The European Single Electronic Format (ESEF) in brief

The submission proces

• ESEF formatted AFRs

• xHTML

• InlineXBRL

Issuers

• Storage of ESEF files

• No validation

Officialy AppointedMechanism (OAP) (Finanstilsynet) • Access to ESEF files

• Search documents

• Historical data

Users

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The ESEF in brief

What do embedded XBRL tags look like?

… a standard web page with additional layer of information that can be displayed when clicking on a certain tagged element

Source: ESMA 2019

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How to get prepared for the ESEF

Timing is key – Start early!

LEARNING• Familiarise

yourself with the ESEF requirements and with the ESEF taxonomy

• Educate your teams and management

1

STRATEGY • In-house or

externalized production?

• Governance of the ESEF project (validation, key actors, etc.

3MAPPING• Map your

financial statements to the ESEF taxonomy

• Analyse the need for extensions and anchors

2

SOFTWARE TOOL• Start assessing the

right solution• “Built in” or “bolt on”

approach• Standalone iXBRL or

disclosure management solutions

4

49© Deloitte 2019

ParsePortMichael Wennerstrøm, Sales Director

[email protected]

+45 53536845

mailto:[email protected]

52© Deloitte 2019

Feedback

Filing companies want to keep PDF as this is predominant format.

Consolidation of financial data ends in Excel.

Many stakeholders – Many cumbersome processes.

(Visual, financial, legal, IR, Management etc.)

XBRL competences is limited and difficult to learn.

Transition from XBRL -> iXBRL should be as seamless as possible.

Production process need to be updated.

Support for last minute changes.

53© Deloitte 2019

Our recommandation

Start early.

Eat the elephant one bite at a time

Utilize the available resources.

Deloitte, events, XBRL Denmark, authorities, solution providers.

Develop a strategy that lasts for +2 years whilst keeping ESMA

roadmap in mind.

Remember the graphical part of the Annual report

Pilot your 2019 annual report.

Consider if taxonomy tagging & XBRL knowledge adds value or

should be outsourced.

55© Deloitte 2019


Future impacts and trends

Annual

Report

2019

Annual

Report

2029

IASB Primary Financial Statement project

IASB Management Commentary project

Production

Dissemination

Consumption

Tech

no

log

yA

ccou

nti

ng

Ru

les

No

n-f

inan

cia

l

Rep

orti

ng

Financial Reporting

Non-Financial Reporting

56© Deloitte 2019


Latest trends and insights from DK and abroad

Chairman/CEO letterSummarising events of the year in one-pagers combined with “the annual report” in 10 minutes.

0201

Business modelExplain the business model and graphics and illustrations to make a complex business model easy to understand.04

03

05

06

Purpose and cultureIncreasing trend in disclosing the Company’s purpose and culture and setting out company purpose beyond profits for shareholders.

OutlookMore companies now include not only one year outlook, but also outlook for the medium term.

Climate changeFrom a risk perspective, the World Economic Forum’s 2019 annual risk survey identifies the climate crisis as the number one threat to the global economy. We expect voluntary disclosure on the companies’ policies/actions on climate change.

CSR, SDGs and sustainabilityPlace detailed statements on the website and provide links and a short summary in the annual report.

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Latest trends and insights from DK and abroad

APMsUse of APMs remains popular. Compliance with ESMA guidelines remains somewhat mixed.

0807

Accounting policiesWhen talking about judgements and estimations, there should be a clear distinction hereof.10

09

11

12

Remuneration reportAre becoming more frequent in the annual reports, probably preparing for the upcoming requirement.

Notes to the financial statementsTendency is to include - before each group of notes - a cover page summarising the content of the group and comments on the main developments in the group of notes in the section.

Non-financial informationMany investors are keen to have insight into the level of distributable profits a company has.

Supplier financing arrangementsRegulators have called for more insight into companies’ supplier financing arrangements. Only few companies include disclosures on this matter.

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ESG reporting

We continue to see growing expectations from investors for companies to disclose ESG information and data in connection with their financial reporting.

The stages of improving ESG data quality

Improving ESG* data quality can e.g. be obtained through a 7-step approach aligned with the COSO Framework:

1. The business case

2. Setting an objective and developing a roadmap

3. Understanding the improvements your company needs

4. Making changes to improve ESG data quality

5. Reporting on internal controls

6. Monitoring and ongoing improvements

7. Assurance

* ESG = Environmental, Social and Governance

ESG procedures

The WBCSD / FSR guide to improving ESG information quality was published in June 2019:

https://www.wbcsd.org/Programs/Redefining-Value/External-Disclosure/Assurance-Internal-Controls/Resources/Guidance-on-improving-the-quality-of-ESG-information-for-decision-making

https://www.wbcsd.org/Programs/Redefining-Value/External-Disclosure/Assurance-Internal-Controls/Resources/Guidance-on-improving-the-quality-of-ESG-information-for-decision-making

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Other topics

New IFRSs and amendments

2019

IFRS 16 Leases

2021

IFRIC 23 Uncertainty over income Tax Treatments

IFRS 17 Insurance Contracts

IAS 28: Long-term Interests in Associates and Joint

Ventures

Annual Improvements to IFRSs 2015-2017 Cycle

IAS 19: Plan Amendment, Curtailment or Settlement

Annual Improvements to IFRSs 2015-2017 Cycle

IAS 19: Plan Amendment, Curtailment or Settlement

Amendments

New IFRS / IFRIC

Not yet endorsed by EU

IAS 1 and 8: Definition of Material

IFRS 3: Definition of a business

2020

IFRS 9: Prepayment Features with Negative

Compensation

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IFRIC 23 Uncertainty over Income Tax Treatments

Other topics• Probability assessments

Uncertain tax positions are likely to be based on significant accounting estimates and shall be based on probability assessments and recognised at either of the following two methods: the most likely amount or the expected value method.

• Delayed paymentWhen there is no significant uncertainty with respect to the overall amount of income tax payable and an entity deliberately delays payment, the resulting interest and penalties can be clearly distinguished from the assessed income tax. Accordingly, the interest and penalties should be presented separately according to their nature (i.e. either as a finance cost (interest) or operating expense (penalties)).

• Access to informationWhen performing estimates and judgements, companies now have to assume that tax authorities have access to all relevant information.

• Detection riskDetection risk should not be considered in the recognition and measurement of uncertain tax treatments.

• Gross presentationProvision for uncertainties over tax treatments (e.g. related to transfer pricing) shall be recognised on a gross basis, unless off-setting rights exists within one country’s joint taxation. Also current and deferred tax position are reported gross under IAS 12.

• Effective dateAn entity shall apply this Interpretation for annual reporting periods beginning on or after 1 January 2019. Earlier application is permitted.

• Interest and penaltiesIf an entity considers a particular amount payable or receivable for interest and penalties to be an income tax (e.g. due to significant uncertain tax positions), then that amount is within the scope of IAS 12 and, when there is uncertainty, also within the scope of IFRIC 23.

• BrexitShould Brexit be a reality, there is uncertainty in relation to whether the existing EC Arbitration Convention will apply – similarly it is uncertain whether the new EU Directive on tax dispute resolution mechanisms in the European Union will apply (this will depend on whether UK reach an agreement with the EU covering this).

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Remuneration Policy - We see particular complexity in ensuring the new remuneration policy being aligned with the Company’s business strategy, long-term interests and sustainability

Other topics

Content of the new Remuneration Policy Gap analysis

As the drive for improved corporate governance spreads across the EU, there is an increased focus on executive pay, also from the policymakers and the press. In order to ensure compliance with applicable law requirements, Deloitte has established a framework for a structured, simple and actionable gap analysis in order to get started with the implementation of the EU Shareholder Rights Directive (“SRD II”) as implemented into Danish Companies Act, section 139a.

63© Deloitte 2019

Remuneration Report - 33% of Danish Large Cap companies are not complying with the current 2018 Corporate Governance recommendations

Other topics

Remuneration Report Survey

We have surveyed the remuneration reports for the 39 Danish Large Cap companies for the period 2014-2018 in order to check for compliance with the current Danish Corporate Governance recommendations. We have had focus on the main principles for the recommendations being:

• Whether a separate remuneration report was prepared and published on the Company’s website

• Whether the remuneration reports included disclosure on individual salaries of executives

• Whether the remuneration reports included a 3-year overview of remuneration

Our findings are noted below:

• 33% of the Danish Large Cap companies are not complying with all of the current 2018 Corporate Governance recommendations

• Only 51% of the Danish Large Cap companies published a separate 2018 remuneration report on their website

• 18% of the surveyed companies did not disclose individual salaries for executives

• 23% of the surveyed companies did not disclose a 3-year overview

64© Deloitte 2019

Assurance OfferingsServices

Disruptive events – Exit readiness

and IPO assistance

Proces optimisation –financial processes

ERP support –Microsoft

Pension management services

Corporate Governance

Accounting Advisory,IFRS and DK GAAP

65© Deloitte 2019

Appendix I

Key contacts – Assurance Offerings

Manager, Complex Accounting

Phone: +45 53 43 40 12

[email protected]

Ismaeel Rasul

Partner, Complex Accounting

Phone: +45 22 20 23 56

[email protected]

Bjarne Iver Jørgensen

Partner, Corporate Governance

Phone: +45 21 27 65 58

[email protected]

Martin Faarborg

Director, Process Optimisation

Phone: +45 30 78 21 47

[email protected]

Casper Kjær Andersen

Partner, Disruptive Events

Phone: +45 30 93 59 82

[email protected]

Bjørn Rosendal

Manager, Complex Accounting

Phone: +45 30 93 48 53

[email protected]

Lasse René Sørensen

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Appendix I

Key contacts – Other

Director, Audit & Assurance

Phone: +45 20 23 77 72

[email protected]

Jan Peter Larsen

Senior Manager, Audit & Assurance

Phone: +45 29 43 00 14

[email protected]

Henrik Gustavsen

Partner, Audit & Assurance

Phone: +45 22 20 28 26

[email protected]

Søren Nielsen

Partner, Strategic & Reputation Risk

Phone: +45 20 75 78 25

[email protected]

Marie Voldby

Director, Audit & Assurance (iXBRL)

Phone: +45 23 23 20 25

[email protected]

Henrik Grønnegaard

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