pwc.pl/ifrs discover the ifrs16 disclosures...pwc.pl/ifrs lease by lessee – discover the ifrs16...
TRANSCRIPT
pwc.pl/IFRS
pwc.pl/IFRS
Lease by lessee – discover the IFRS16 disclosures
Case study 2019
1. Overview of the Company and its previous lease disclosures
Leases by lessee – Discover the IFRS16 disclosures – Case study 2
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
Tomasz Konieczny
PwC Partner Capital Markets and Accounting Advisory Services
In January 2016 the International Accounting Standards Board (IASB) issued IFRS16 “Leases”, thereby starting a new era of lease accounting – at least for lessees. Whereas under the previous guidance in IAS17 “Leases”, a lessee had to make a distinction between a finance lease (on balance sheet) and an operating lease (off balance sheet), the new model requires the lessee to recognise almost all lease contracts on the balance sheet; the only optional exemptions are for certain short-term leases and leases of low-value assets. For lessees that have entered into contracts classified as operating leases under IAS17, this could have a significant impact on the financial statements.
IFRS16 “Leases” is effective from 1 January 2019. The new standard replaces IAS17 “Leases”, IFRIC4 “Determining Whether an Arrangmenet Contains a Lease”, SIC-27 “Evaluating the Substance of Transactions Involving the Legal Form of a Lease” and SIC-15 “Operating Leases – Incentives”.
This case study publication aims to concentrate on the disclosure aspect of the new standard for the lessee. Only incidental subleases are presented to indicate that the new lease model for lessee may impact also accounting for subleases, nevertheless this publication is not designed for lessors.
We have deliberately selected a company with a relatively simple business model – a manufacturer of furniture and equipment sold through its own retail chain. We have provided the company’s background, followed by IAS17 disclosures and then presented extracts from the 2019 financial statements that incorporate the requirements of IFRS16. This is an example of the impact and disclosures of IFRS16 and, therefore, should not be perceived as being a comprehensive source of knowledge on IFRS16 or disclosure requirements.
We hope you will find this case study useful and it will help you better understand the difference between the old and new disclosure requirements.
1. Overview of the
Company and its
previous lease
disclosures
On the following pages we present details of the Company’s business and the IAS
17 disclosure from the financial statements for the year ended 31 December 2018.
In the final part of this section, we have summarised the impact of IFRS16. Whilst
the Company identified many differences on the adoption of the new standard, the
list is not exhaustive and other companies may identify different adjustments
arising from the adoption of IFRS16.
Commentary
M a r t a M a d e j s k a
Director
1. Overview of the Company and its previous lease disclosures
`
Lease by lessee – Discover the IFRS16 disclosures – Case study 4
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
Information about the Company
The Company is a furniture manufacturer in Poland. The products are sold through 25 own-brand stores
located in major European cities.
All the stores are in the leased properties. The manufacturing plant is owned by the Company but is
located on the plot of land which it uses based on a land lease agreement. The Company also leases
a fleet of delivery vans to transport goods from the factory to the central warehouse and to the stores.
The Company has some incidental subleases.
The Company prepares its financial statements in accordance with EU IFRS.
All leases were classified as operating leases under IAS17. The extracts from the financial statements
relating to the Company’s lease arrangements are presented below. Comparative information has been
omitted.
For the purpose of financial reporting, the Company assumes that the total change in equity/net profit
of EUR 150 thousand would be of material importance to investors and, therefore, it determined that the
adjustments identified in respect of individual balance sheet items in excess of EUR 15 thousand (i.e.
10% of the overall materiality level) are always recognised in the financial statements.
Disclosures relating to leases in the Company’s financial statements for the year ended 31/12/2018
Note 10. Operating leases (extract from the financial statements)
Accounting policies
L e a s e s i n w h i c h s u b s t a n t i a ll y a ll t h e r i s k s a n d r e w a r d s o f o w n e r s h i p a r e n o t t r a n s f e r r e d t o t h e l e s s e e ar e
c l a s s i f i e d a s o p e r a t i n g le a s e s .
T h e C o m p a n y i s a le s s e e i n o p e r a t i n g l e a s e a r r a n g e m e n t s . P a y m e n t s m a d e u n d e r o p e r a t in g l e a s e s ( n e t of a n y
i nc e n t i v e s r e c e i v e d f r o m t h e le s s o r ) a r e c h a r g e d t o p r o f i t o r lo s s o n a s t r a i g h t - li n e b a s i s o v e r t h e p e r i o d o f t h e
le a s e . C o nt i n g e n t r e n t s a r e r e c o g n i s e d a s a n e x p e n s e w h e n i n c u r r e d .
T h e C o m p a n y i s a s u b l e s s o r o f c e r t a i n a s s e t s le a s e d u n d e r h e a d o p e r a t i n g l e a s e c o n t r a c t s. T h o s e s u b le a s e s
a r e c l a s s i fi e d a s o p e r a t i n g l e a s e s . L e a s e i n c o m e i s r e c o g n i s e d o n a st r a i g h t - li n e b a si s o v er t h e le a s e t e r m .
T h e C o m p a n y d o e s n o t h a v e a n y l e a s e s c l a s s i fi e d a s f i n a n c e l e a s e s .
The lease where the Company is a lessee
The Company uses the following assets based on operating lease arrangements: retail stores, an office
building, a plot of land, delivery vans, other small equipment (e.g. computers, mobile phones).
The leases have varying terms, termination and renewal rights. The main lease terms are summarised
below:
• Retail stores have a non-cancellable lease term between 5 and 8 years. The contracts contain an
option to renew the lease. The lease payments are a fixed amount, plus percentage of sales
exceeding a predetermined level.
• The land lease agreement is for 99 years with a cancellation period of 3 months. All payments are
variable based on the fair value of the leased land.
• The office building has a non-cancellable lease term of 10 years with an option to renew the contract.
The lease payments are fixed, adjusted for inflation.
• The vans are leased for 1 year with an option to renew the lease.
• Small equipment (e.g. computers, mobile phones) is leased for a fixed period of two years with the
purchase option at fair value.
The Company subleases certain of those assets under operating lease agreement to the related party.
1. Overview of the Company and its previous lease disclosures
Leases by lessee – Discover the IFRS16 disclosures – Case study 5
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
The table below presents minimum lease payments in relation to non-cancellable operating leases
where the Company is a lessee:
(in EUR’000)
31/12/2018
Future minimum lease payments in relation to non-cancellable operating leases are payable as follows:
Within one year 3,150
Later than one year but not later than five years 12,383
Later than five years 10,859
Total 26,392
Not included in the above commitments are contingent rental payments which may arise in the event that sales generated by the stores exceed a pre-determined level. The contingent rent is 1% of sales revenue from the excess sales. The whole rent payable for the land lease is excluded from the minimum lease payments disclosed above as all payments are contingent rent based on the fair value of the land. The annual payment for the last financial year amounts to EUR 70 thousand.
The table below presents the lease expense in relation to operating leases which is recognised in profit
or loss for the 12-month period ended 31/12/2018:
(in EUR’000) Selling
costs Administrative
expenses 2018 Total
Rental expense relating to operating leases:
Minimum lease payments 3,014 260 3,274
Contingent rent 191 - 191
Total operating lease expense 3,205 260 3,465
The following items resulting from operating lease contracts are recognised in the statement of financial
position:
None of the Company’s leases were determined to be onerous.
The lease where the Company is a lessor
The Company is as a lessor in incidental situations. The Company currently subleases part of its office space and some of its computers to a related party. Income from these leases amounts to EUR 40 thousand (2017: EUR 39 thousand). The future minimum lease payments in relation to non-cancellable operating leases are as follows:
(in EUR’000)
31/12/2018
Future minimum lease payments in relation to non-cancellable operating suleases leases are payable as follows:
Within one year 47
Later than one year but not later than five years 164
Later than five years 126
Total 331
None of the Company’s leases were determined to be onerous.
(in EUR’000) 31/12/2108
Other assets
Prepaid rent in operating lease contracts (lease of stores) 510
Other liabilities
Accrual for the rent free periods in operating lease contracts (lease of office buildings) 20
1. Overview of the Company and its previous lease disclosures
Leases by lessee – Discover the IFRS16 disclosures – Case study 6
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
Impact of the application of IFRS16
Method of initial application
The Company is applying IFRS16 for the first time for the year commencing 1/1/2019.
IFRS16 allows two methods of initial application: (1) full retrospective application with the restatement
of comparatives and (2) modified retrospective approach without the restatement of comparatives and
with certain simplifications available upon adoption. The Company has elected to use the second
approach by implementing the standard retrospectively in relation to all leases in which the Company is
a lessee without restating comparatives. The implementation of IFRS16 will not affect total equity. The
adjustments to assets and liabilities are disclosed in Note 3 to the financial statements.
1. Overview of the Company and its previous lease disclosures
Leases by lessee – Discover the IFRS16 disclosures – Case study 7
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
Main areas of IFRS16 adjustments
The following is a short summary of the differences the Company identified on adoption of IFRS16:
A r e a a n d i m p a c t o f I F R S 1 6 S e e f u r t h e r
A . L e a s e s w h e r e t h e C o m p a n y i s a l e s s e e
A . 1 A c c o u n t i n g f o r a l l l e a s e s e x c e p t f o r s h o r t - t e r m l e a s e s a n d c e r t a i n l e a s e s o f l o w -
v a l u e a s s e t s : F o r a l l l e a s e s , e x c e p t f o r s h o r t - t e r m l e a s e s a n d c e r t a i n l e a s e s o f l o w -
v a l u e a s s e t s , p r e v i o u s l y c l a s s i f i e d a s o p e r a t i n g l e a s e s :
• a s a t 1 / 1 / 2 0 1 9 t h e C o m p a n y w i l l r e c o g n i s e a l e a s e l i a b i l i t y m e a s u r e d a t t h e
p r e s e n t v a l u e o f t h e r e m a i n i n g l e a s e p a y m e n t s , d i s c o u n t e d u s i n g t h e C o m p a n y ’ s
i n c r e m e n t a l b o r r o w i n g r a t e a t 1 / 1 / 2 0 1 9 .
A . 2 P r a c t i c a l e x p e d i e n t s : T h e C o m p a n y e l e c t e d t o u s e t h e f o l l o w i n g p r a c t i c a l
e x p e d i e n t s :
• a s i n g l e d i s c o u n t r a t e w i l l b e a p p l i e d t o a p o r t f o l i o o f le a s e s w i t h r e a s o n a b l y
s i m i l a r c h a r a c t e r i s c t i c s ;
• t h e a s s e s s m e n t o f w h e t h e r l e a s e s a r e o n e r o u s , a p p l y i n g I A S 3 7 “ P r o v i s i o n s ,
C o n t i n g e n t L i a b i l i t i e s a n d C o n t i n g e n t A s s e t s ” , i m m e d i a t e l y b e f o r e 1 / 1 / 2 0 1 9 w i l l
b e u s e d a s a n a l t e r n a t i v e t o p e f o r m a n i m p a i r m e n t a n a l y s i s . A s t h e a n a l y s i s o f
t h e o n e r o u s c o n t r a c t s a s a t 3 1 / 1 2 / 2 0 1 8 h a s n o t r e s u l t e d i n t h e n e e d t o r e c o g n i s e
a p r o v i s i o n , t h e r i g h t - o f - u s e a s s e t a t 1 / 1 / 2 0 1 9 w i l l n o t b e a d j u s t e d b y a n y
i m p a i r m e n t a l l o w a n c e ;
• n o t t o a p p l y t h e n e w l e s s e e a c c o u n t i n g m o d e l t o l e a s e s f o r w h i c h t h e l e a s e t e r m
e n d s w i t h i n 1 2 m o n t h s a f t e r t h e d a t e o f i n i t i a l a p p l i c a t i o n . I n s t e a d , t h o s e l e a s e s
w i l l b e a c c o u n t e d f o r a s s h o r t - t e r m l e a s e s .
Note 3.1 in the
financial statements
A . 3 L e a s e s o f lo w - v a lu e a s s e t s : T h e C o m p a n y h a s e le c t e d t o a p p l y t h e e x e m p t i o n f o r lo w -
v a lu e a s s e t s s u c h a s s m a l l e q u i p m e n t ( e . g . c o m p u t e r s , m o b i le p h o n e s ) o n a le a s e - b y -
le a s e b a si s . T h e C o m p a n y h a s d e c i d e d t h a t f o r t h e le a s e s w h e r e t h e a s s e t i s s u b - l e a s e d
(s e e p o i n t B b e lo w) , a r i g h t - o f - u s e a s s e t i s r e c o g n i s e d wi t h c o r r e s p o n d i n g l e a s e l i a b i li t y.
F o r a l l o t h e r l e a s e s o f lo w v a lu e a s s e t , t h e l e a s e p a y m e n t s a s s o c i a t e d wi t h t h o s e l e a s e s
w i l l b e r e c o g n i s e d a s a n e x p e n s e o n a s t r a i g h t - li n e b a s i s ov e r t h e l e a s e t e r m .
Note 3.1 in the
financial statements
A . 4 S h o r t - t e r m l e a s e s : T h e C o m p a n y h a s e le c t e d t o a p p l y t h e e x e m p t i o n f o r a ll s h o r t - t e r m
le a s e s ( u p t o 1 2 m o n t h s ) a n d t h er e f o r e t h e l e a s e p a y m e n t s a s s o c i a t e d wi t h t h o s e l e a s e s
w i l l b e r e c o g n i s e d a s a n e x p e n s e o n a s t r a i g h t - li n e b a s i s ov e r t h e l e a s e t e r m .
Note 3.1 in the
financial statements
B . L e a s e s w h e r e t h e C o m p a n y i s a le s s o r
S u b l e a s e o f a n o ffi c e s p a c e w i l l c o n t i n u e t o b e c l a s s i fi e d a s a n o p e r a t i n g l e a s e . T h e
C o m p a n y wi l l r e c o g n i s e t h e ri g h t - o f - u s e a s s e t r e s u lt i n g fr o m t h e h e a d l e a s e . T h e
s u b le a s e d p o r t i o n o f r i g h t - o f -u s e a s s e t wi l l b e c l a s si f i e d a s a n i n v e s t m e n t p r o p e r t y.
R e v e n u e f r o m t h e s u b le a s e wi ll b e r e c o g n i s e d o v e r t h e t e r m o f t h e s u b - l e a s e .
T h e s u b le a s e o f c e r t a i n c o m p u t er s wi l l b e c l a s si f i e d a s a fi na n c e l e a s e . T h e C o m p a n y wi l l
d e r e c o g n i s e t h e r i g h t - o f - u s e a s s e t ( t o t h e e x t e n t t h a t i t i s s u b j e c t t o t h e s u b - l e a s e ) a n d
r e c o g n i s e a f i n a n c e l e a s e r e c e iv a b le ( n e t i n v e s t m e n t i n t h e f in a n c e l e a s e ) .
• F o r a l l l e a s e s t h e C o m p a n y h a s e l e c t e d t o r e c o g n i s e a r i g h t - o f - u s e a s s e t a t a n
a m o u n t e q u a l t o t h e l e a s e l i a b i l i t y, a d j u s t e d b y t h e a m o u n t o f p r e p a i d o r a c c r u e d
l e a s e p a y m e n t s r e l a t i n g t o t h o s e l e a s e s r e c o g n i s e d i n t h e s t a t e m e n t o f f i n a n c i a l
p o s i t i o n i m m e d i a t e l y b e f o r e t h e d a t e o f i n i t i a l a p p l i c a t i o n .
Note 3.1 in the
financial statements
Note 3.1 in the
financial statements
Note 3.1 in the
financial statements
Note 3.1 in the
financial statements
Note 3.1 in the
financial statements
DisclosuresOverview of the Company and its previous revenue recognition policy
2. IFRS16 disclosures in
the annual financial
statements for 2019
Marta Madejska
Director
Due to a significant change in recognition and measurement, the implementation of IFRS16 significantly affects the amounts presented in the financial statements as well as the extent of the required disclosure. Lessees should disclose information that allows users of the financial statements to assess the effect that leases have on the financial position, financial performance and cash flows of the lessee. The disclosure requirements for lessees are set out in paragraphs 51 to 60 of IFRS16. Also in relation to lease liabilities certain disclosures required by IFRS7 should be provided (e.g. contractual undiscounted cash flows in the liquidity table).
Management should consider the level of detail needed to meet the disclosure objective. For example, an entity should aggregate or disaggregate information, as appropriate, to provide clear and meaningful information to a user of the financial statements.
Management should also disclose the application of certain practical expedients, e.g. short-term leases, leases of low-value assets, and other expedients available only on first time adoption.
Upon transition, entities are required to provide disclosures required under IAS8 “Accounting Policies, Changes in Accounting Estimates and Erros”, inter alia the nature of the changes in the accounting policies, the amount of the adjustment for each financial statement line item affected, and the transitional provisions. These are all disclosed in Note 3.
If comparatives are not restated, the accounting policies for the current period (i.e. IFRS16) and
the comparative period (i.e. IAS17) should be provided.
This part of the publication presents the disclosures prepared by the Company in its annual financial
statements in the year of initial application of IFRS16. In compiling the illustrative disclosures, we
have made a number of assumptions in relation to the adoption of IFRS16. In particular, IFRS16 is
adopted using a modified retrospective approach. The Company has also applied certain practical
expedients.
The example disclosures are not the only acceptable form of presenting financial statements.
Alternative presentations may be acceptable if they comply with the specific disclosure
requirements prescribed in the IFRSs. Readers may find our IFRS disclosure checklist 2019 useful
to identify other disclosures that may be relevant under the circumstances but which have not been
illustrated in this publication.
The source for each disclosure requirement is given in the reference column on the left.
Commentary
S u h r o b A z i m o v
Stypułkowska
-Molga
2. IFRS16 disclosures in the annual financial statements for 2019
Leases by lessee – Discover the IFRS16 disclosures – Case study 9
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
Financial statements
for the year ended 31 December 2019
Statement of financial position 10
Statement of profit or loss 11
Statement of comprehensive income 12
Statement of changes in equity 13
Statement of cash flows 14
Notes to the financial statements 14
Note 1. Basis of preparation of the financial statements .................................................. 15
Note 2. Accounting policies [excerpt relating to IFRS16 only] .......................................... 15
Note 3. New and amended standards adopted by the Company [excerpt relating to
IFRS16 only] ................................................................................................................... 15
Note 4. Leases - the Company as a lessee ..................................................................... 17
Note 5 Lease – the Company as a sublessor .................................................................. 23
Note 6 Debt (extract) ....................................................................................................... 24
Note 7. Alternative performance measures used by the Management ............................. 25
Note 8. Financial risk management (extract) ................................................................... 26
Commentary
T h i s p a r t o f t h e p u b li c a t i o n i l lu s t r a t e s t h e t y p e s o f d i s c lo s u r e s t h a t w o u l d b e r e q u i r e d i n t h e y e a r o f t h e f i r s t a d o p t i o n
o f I F R S 1 6 i n t h e f i n a n c i a l s t a t e m e n t s o f o u r f i c t i t i o u s C o m p a n y. It s h o w s m a i n l y t h e d i s c lo s u r e s t h a t a r e i n c r e m e n t a l l y
r e q u i r e d a s a r e s u lt o f a d o p t i n g I F R S 1 6 w h i c h a r e i l lu s t r at e d i n t h i s p u b li c a t i o n . D i s c lo s u r e re q u i r e m e n t s w h i c h e x i s t
i n d e p e n d e n t ly o f t h e a d o p t i o n o f I F R S 1 6 a r e n o t i l lu s t r a t e d (w i t h s o m e e x c e p t i o n s ) a n d t h e s e c a n b e f o u n d i n t h e
P w C p u b li c a t i o n “ I l lu s t r a t i v e IF R S c o n s o li d a t e d f i n a n c i a l s ta t e m e n t s ” . T h e di s c lo s u r e s i n t hi s p u b li c a t i o n m u s t b e
r e a d i n t h e c o n t e x t o f t h e a s s u m p t i o n s s e t o u t i n t h e s e c t i o n “ O v e r v i e w o f t h e C o m p a n y a n d i t s p r e v i o u s l e a s e
d i s c lo s u r e s ” . D i f f e r e n t f a c t s a n d c i r c u m s t a n c e s c o u ld r e s u lt in d i f f er e n t a c c o u n t i n g .
2. IFRS16 disclosures in the annual financial statements for 2019
Leases by lessee – Discover the IFRS16 disclosures – Case study 10
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
Statement of financial position
( i n E U R ’ 0 0 0 ) N o t e s 3 1 / 1 2 / 2 0 1 9 3 1 / 1 2 / 2 0 1 8
A S S E T S
N o n - c u r r e n t a s s e t s
P r o p e r t y , p l a n t a n d e q u i p m e n t 2 1 , 8 0 0 1 8 , 0 0 0
IFRS16p47(a) R i g h t - o f - u s e a s s e t s N o t e 4 . 5 . 1 2 6 , 6 0 1 -
IFRS16p48 I n v e s t m e n t p r o p e r t y N o t e 4 . 5 . 2 2 6 8 -
L o a n s g r a n t e d 3 , 9 8 5 4 , 8 7 8
T o t a l n o n - c u r r e n t a s s e t s 5 2 , 6 5 4 2 2 , 8 7 8
C u r r e n t a s s e t s
T r a d e r e c e i v a b le s 3 1 , 4 1 5 2 4 , 8 5 2
I nv e s t m e n t s i n e q u i t y i n s t r u m e n t s 8 , 0 0 0 8 , 7 0 0
I nv e n t o r y 1 2 , 1 1 3 9 , 0 8 6
O t h e r a s s e t s 2 6 9 1 4
C a s h a n d c a s h e q u i v a le n t s 4 4 4 8 0 0
T o t a l c u r r e n t a s s e t s 5 1 , 9 9 8 4 3 , 3 5 2
T O T A L A S S E T S 1 0 4 , 6 5 2 6 6 , 2 3 0
E Q U I T Y
S h a r e c a p i t a l 5 , 0 0 0 5 , 0 0 0
A c c u m u la t e d o t h e r c o m p r e h e n si v e i n c o m e 3 2 4 1 , 3 7 7
R e t a i n e d e a r n i n g s 2 1 , 1 2 5 1 2 , 3 0 0
T o t a l e q u i t y 2 6 , 4 4 9 1 8 , 6 7 7
L I A B I LI T I E S
N o n - c u r r e n t l i a b i l i t i e s
B o r r o wi n g s N o t e 6 3 8 , 5 0 0 3 8 , 5 0 0
IFRS16p47(b) L e a s e li a b i li t i e s N o t e 4 . 5 . 3 , 6 2 3 , 1 0 6 -
D e f e r r e d t a x li a b i li t y 3 8 5 3
T o t a l n o n - c u r r e n t l i a b i l i t i e s 6 1 , 6 4 4 3 8 , 5 5 3
C u r r e n t l i a b i l i t i e s
B o r r o wi n g s 4 , 8 0 0 -
IFRS16p47(b) L e a s e li a b i li t i e s N o t e 4 . 5 . 3 , 6 2 , 9 2 7 -
T r a d e a n d o t h e r p a y a b le s 8 , 8 3 2 9 , 0 0 0
T o t a l c u r r e n t l i a b i l i t i e s 1 6 , 5 5 9 9 , 0 0 0
T O T A L E Q U I T Y A N D L I A B I L I T I E S 1 0 4 , 6 5 2 6 6 , 2 3 0
Commentary
A f t e r a n a l y s i n g t h e r e q u i r e m e n t s o f I A S 1 “ P r e s e nt a t i o n o f Fi n a n c i a l S t a t e m e n t s ” a n d IF R S 1 6 , t h e C o m p a n y
d e c i d e d t o p r e s e n t s e p a r a t e l y r i g h t - of - u s e a s s e t s ( e x c e p t f o r th o s e i t e m s t h a t a r e c l a s s i fi e d a s i nv e s t m e n t p r o p e r t y )
a n d t h e l e a s e li a b i li t y. N e v e r th e l e s s , I F R S 1 6 d o e s n o t r e q u i r e t h e s e i t e m s t o b e p r e s e n t e d s e p a r a t e l y i n t h e
s t a t e m e n t o f f i n a n c i a l p o s i t i o n . T h e l e s s e e c a n p r e s e n t r i g h t - o f - u s e a s s e t s e i t h e r s e p a r a t e ly o r i n t h e s a m e li n e
it e m i n w h i c h t h e u n d e r l yi n g a s s e t s w o u l d b e p r e s e n t e d i n t h e s t a t e m e n t o f f i n a n c i a l p o si t i on i f t h e y w e r e o w n e d .
It c a n p r e s e n t le a s e li a bi li t i e s e it h e r a s a s e p a r a t e li n e i t e m o r t o g e t h e r wi t h ot h e r f i n a n c i a l lia b i li t i e s . If r i g h t - o f - u s e
a s s e t s o r le a s e li a bi li t i e s a r e n o t p r e s e n t e d a s s e p a r a t e li n e i t e m s, a n e n t i t y d i s c lo s e s i n t he n o t e s t h e i r c ar r yi n g
a m o u n t s a n d t h e li n e i t e m s i n w h i c h t h e y a r e i n c lu d e d .
W h e r e t h e c o m p a n y s u b le a s e s t h e r i g h t - of - u s e a s s e t i n a n o p e r a t i n g l e a s e , s u c h r i g h t - o f - u s e a s s e t i s c l a s s i f i e d a s
i nv e s t m e n t p r o p e r t y ( u n d e r l yi n g le a s e d a s s e t m e e t s t h e d e f in i t i o n o f i n v e s t m e n t p r o p e r t y) o r r i g h t - o f - u s e a s s e t s
( s u b le a s e s o f a s s e t s o t h e r t h a n t h o s e t h a t m e e t i n v e s t m e n t p r o p e r t y d e f i n i t i o n) . W h e r e t h e c o m p a n y s u b le a s e s
t h e a s s e t i n fi n a n c e le a s e , a s s e t i s p r e s e n t e d a s f i n a n c e l e a s e r e c e i v a b le a t a n a m o u n t e q u a l t o t h e n e t i n v e s t m e n t
i n t h e f i n a n c e le a s e . T h e f i n a n c e s u b le a s e i s n o t m a t e r i a l f o r o u r C o m p a n y t h u s t h e f i n a n c e le a s e r e c e i v a b le i s n o t
p r e s e n t e d i n t h e s e p a r a t e li n e it e m i n t h e s t a t e m e n t o f f i n a n cia l p o s i ti o n b ut i n c lu d e d wi t h i n “o t h e r a s s e t s ” .
2. IFRS16 disclosures in the annual financial statements for 2019
Leases by lessee – Discover the IFRS16 disclosures – Case study 11
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
Statement of profit or loss
( i n E U R ’ 0 0 0 ) N o t e s
1 2 m o n t h s e n d e d
3 1 / 1 2 / 2 0 1 9
1 2 m o n t h s e n d e d
3 1 / 1 2 / 2 0 1 8
R e v e n u e 1 3 4 , 8 6 0 1 2 6 , 5 8 0
C o s t o f s a le s ( 9 2 , 6 6 4 ) ( 9 4 , 1 7 5 )
G r o s s p r o f i t 4 2 , 1 9 6 3 2 , 4 0 5
D i s t r i b u t i o n e x p e n s e s ( 2 0 , 0 4 3 ) ( 1 3 , 4 0 2 )
A d m i ni s t r a t i v e e x p e n s e s ( 7 , 4 6 0 ) ( 3 , 9 1 7 )
I m p a i r m e n t lo s s o n f i n a n c i a l a s s e t s ( 3 2 0 ) ( 1 , 7 5 0 )
F a i r v a lu e g a i n s / l o s s e s o n f i n a n c i a l i n s t r u m e n t s ( 1 7 0 ) -
D i v i d e n d i n c o m e 5 2 0 5 4 0
L o s s e s o n e a r ly t e r m i n a t i o n o f le a s e s Note 4.5.1 ( 2 1 0 ) -
O t h e r i n c o m e / ( e x p e n s e ) 4 2 -
I nt e r e s t i n c o m e 1 0 9 2 0 0
IFRS16p49 Fi n a n c e c o s t s Note 6 ( 3 , 7 3 0 ) ( 1 , 9 8 0 )
P r o f i t b e f o r e i n c o m e t a x 1 0 , 9 3 4 1 2 , 0 9 6
I n c o m e t a x e x p e n s e ( 2 , 1 0 9 ) ( 2 , 3 0 1 )
P r o f i t f o r t h e p e ri o d 8 , 8 2 4 9 , 7 9 5
E a r n i n g s p e r s h a r e ( b a s i c a n d d i l u t e d ) 1 1 , 7 1 0 , 9
Commentary
I F R S 1 6 r e q u i r e s t h e p r e s e n t a t io n o f i n t e r e s t e x p e n s e o n t h e le a s e li a bi li t y s e p a r a t e l y f r o m th e d e p r e c i at i o n c h a r g e f o r
t h e r i g h t - o f - u s e a s s e t . T h e le s s e e p r e s e n t s t h e d e p r e ci a t i o n c h a r g e o f t h e r i g h t - o f - u s e a s s e t in t h e s a m e li n e i t e m / i t e m s
i n w h i c h s i m i la r e x p e n s e i s s h o w n i n p r o f i t o r lo s s . I n t e r e s t e x p e n s e o n t h e l e a s e li a bi li t y i s p r e s e nt e d a s p a r t o f f i n a n c e
c o s t s .
D u e t o t h e f a c t t h a t t h e C o m p a n y h a s a p p li e d t h e m o d i f i ed r e t r o s p e c t i v e a p p r o a c h , t h e a m o u n t s p r e s e n t e d i n t h e
c u r r e n t y e a r a n d t h e c o m p a r a t iv e s a r e n o t c o m p a r a b le .
I n p a r t i c u la r w e w o u l d li k e t o d r a w y o u r a t t e n t i o n t o t h e f a c t t ha t a d o p t i o n o f I F R S 1 6 ( e s p e c i a l l y i f t h e s i m p li f i e d m e t h o d
is a p p li e d ) m a y h a v e a n i m p a c t o n t h e r e c o g n i t i o n o f le a s e r e la t e d e x p e n s e s c o m p a r e d t o t h e p r e v i o u s o p e r a t i n g l e a s e
m o d e l. U n d e r I A S 1 7 t o t a l le a s e e x p e n s e h a d t o b e r e c o g n i s e d o n a s t r a i g h t li n e b a s i s o v e r t h e l e a s e t e r m . U n d e r
I F R S 1 6 , w h i l e t h e r i g h t - o f - u s e as s e t wi l l m o s t o f t h e t i m e b e d e p r e c i at e d o n a s t r a i g h t li n e b a s i s a s w e l l, t h e i nt e r e s t
e x p e n s e wi l l b e r e c o g n i s e d d e g r e s s i v e l y t o r e f le c t t h e a m o u n t of d i m i ni s hi n g li a bi li t y b a la n c e a s t h e l e a s e p r o g r e s s e s .
T h e c o m b i n e d e f f e c t of t h e d e p r e ci a t i o n o f t h e r i g h t - o f - u s e a s s e t a n d i n t e r e s t c h a r g e wi ll e x c e e d o p e r a t i n g le a s e
e x p e n s e i n t h e e a r l y y e a r s o f t h e l e a s e a n d t h e s i t u a t i o n wi l l r ev e r s e t o w a r d s t h e e n d o f th e l e a s e t e r m . T h e c h a r t
b e l o w d e p i c t s t h a t p h e n o m e n o n .
2. IFRS16 disclosures in the annual financial statements for 2019
Leases by lessee – Discover the IFRS16 disclosures – Case study 12
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
Statement of comprehensive income
( i n E U R ’ 0 0 0 ) N o t e s
1 2 m o n t h s e n d e d
3 1 / 1 2 / 2 0 1 9
1 2 m o n t h s e n d e d
3 1 / 1 2 / 2 0 1 8
P r o f i t f o r t h e p e ri o d 8 , 8 2 4 9 , 7 9 5
O t h e r c o m p r e h e n s i v e i n c o m e – I t e m s t h a t w i l l n o t b e
r e c l a s si f i e d t o p r o f i t o r l o s s
C h a n g e s i n t h e f a i r v a lu e o f e q u i t y i n v e s t m e n t s a t
F V O C I ( 7 0 0 ) 1 , 7 0 0
I n c o m e t a x 1 3 3 ( 3 2 3 )
O t h e r c o m p r e h e n s i v e i n c o m e – I t e m s t h a t w i l l b e
r e c l a s si f i e d t o p r o f i t o r l o s s
C a s h f lo w h e d g e ( 6 0 0 ) -
I n c o m e t a x 1 1 4 -
O t h e r c o m p r e h e n s i v e i n c o m e f o r t h e p e r i o d , n e t o f t a x ( 1 , 0 5 3 ) 1 , 3 7 7
T o t a l c o m p r e h e n s i v e i n c o m e f o r t h e p e r i o d 7 , 7 7 1 1 1 , 1 7 2
Commentary
W e d o n o t e x p e c t o t h e r c o m p r e h e n s i v e i n c o m e t o b e d ire c t ly a f f e c t e d b y t h e n e w le a s i n g s t a n d a r d , u n le s s
r ev a lu a t i o n m o d e l i s a p p li e d b y t h e e n t i t y t o t h e r i g h t - o f - u s e a s s e t s .
2. IFRS16 disclosures in the annual financial statements for 2019
Leases by lessee – Discover the IFRS16 disclosures – Case study 13
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
Statement of changes in equity
A c c u m u l a t e d O C I
( i n E U R ’ 0 0 0 ) N o t e s
S h a r e
c a p i t a l
F V
g a i n / l o s s
C a s h f l o w
h e d g e
R e t a i n e d
e a r n i n g s T o t a l
B a l a n c e a s a t 1 / 1/ 2 0 1 8
5 , 0 0 0 - - 3 , 5 0 5 8 , 5 0 5
P r o f i t f o r t h e p e ri o d - - - 9 , 7 9 5 9 , 7 9 5
O t h e r c o m p r e h e n s i v e i n c o m e
- 1 , 3 7 7 - - 1 , 3 7 7
T o t a l c o m p r e h e n s i v e i n c o m e fo r
t h e p e ri o d
- 1 , 3 7 7 - 9 , 7 9 5 1 1 , 1 7 2
D i v i d e n d
- - - ( 1 , 0 0 0 ) ( 1 , 0 0 0 )
T r a n s a c t i o n s wi t h o w n e r s - - - ( 1 , 0 0 0 ) ( 1 , 0 0 0 )
B a l a n c e a s a t 3 1 / 1 2 / 2 0 1 8 5 , 0 0 0 1 , 3 7 7 - 1 2 , 3 0 0 1 8 , 6 7 7
B a l a n c e a s a t 1 / 1/ 2 0 1 9 5 , 0 0 0 1 , 3 7 7 - 1 2 , 3 0 0 1 8 , 6 7 7
IFRS16pC5(b) IAS 1.106
A dj u s t m e n t o n t h e a d o p t i o n o f
I F R S 1 6 N o t e 3
- - - - -
B a l a n c e a s a t 1 / 1/ 2 0 1 9
(r e s t at e d )
5 , 0 0 0 1 , 3 7 7 - 1 2 , 3 0 0 1 8 , 6 7 7
P r o f i t f o r t h e p e ri o d - - - 8 , 8 2 4 8 , 8 2 4
O t h e r c o m p r e h e n s i v e i n c o m e - ( 5 6 7 ) ( 4 8 6 ) - ( 1 , 0 5 3 )
T o t a l c o m p r e h e n s i v e i n c o m e fo r
t h e p e ri o d
- ( 5 6 7 ) ( 4 8 6 ) 8 , 8 2 4 7 , 7 7 1
B a l a n c e a s a t 3 1 / 1 2 / 2 0 1 9 5 , 0 0 0 8 1 0 ( 4 8 6 ) 2 1 , 1 2 5 2 6 , 4 4 9
Commentary
A s t h e C o m p a n y a p p li e d t h e s i m p li f i e d m e t h o d o f a c c o u n t in g f o r t r a n si t i o n t o I F R S 1 6 , i t r e c o g n i s e d t h e r i g h t - o f - u s e
a s s e t s a t a n a m o u n t e q u a l t o r e c o g n i s e d l e a s e li a b i li t y s u b jec t t o a d j u s t m e n t s f o r p r e v i o u s l y r e c o g n i s e d a s s e t s o r
li a bi li t i e s r e l a t i n g t o o p e r a t i n g le a s e s . T h e r e w e r e n o r e la t e d d e f e r r e d t a x e f f e c t s a n d , a c c o r d i n g l y, t h e a d o p t i o n o f
I F R S 1 6 h a d n o i m p a c t o n e q u i t y a s a t 1 J a n u a r y 2 0 1 9 .
2. IFRS16 disclosures in the annual financial statements for 2019
Leases by lessee – Discover the IFRS16 disclosures – Case study 14
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
Statement of cash flows
( i n E U R ’ 0 0 0 ) N o t e s
1 2 m o n t h s e n d e d
3 1 / 1 2 / 2 0 1 9
1 2 m o n t h s e n d e d
3 1 / 1 2 / 2 0 1 8
C a s h f lo w s f r o m o p e r a t i n g a c t iv i t i e s
P r o f i t b e f o r e i n c o m e t a x 1 0 , 9 3 4 1 2 , 0 9 6
A d j u s t m e n t s f o r :
A m o r t i s a t i o n a n d d e p r e c i a t i o n 2 , 8 6 3 6 6 0
I m p a i r m e n t o f f i n a n ci a l a s s e t s 3 2 0 1 , 7 5 0
D i v i d e n d s r e c e i v e d ( 5 2 0 ) ( 5 4 0 )
I nt e r e s t a n d f i n a n c e l e a s e i n c o m e ( 1 0 9 ) ( 2 0 0 )
O t h e r i n c o m e / ( e x p e n s e ) N o t e 4 . 5 . 1 2 1 0 -
F i n a n c e c o s t s 3 , 7 3 0 1 , 9 8 0
F a i r v a lu e g a i n s / l o s s e s o n f i n a n c i a l i n s t r u m e n t s 1 7 0 -
I n c o m e t a x p a i d ( 2 , 5 2 4 ) ( 2 , 5 7 1 )
C h a n g e i n w o r k i n g c a p i t a l
( I n c r e a s e ) / D e c r e a s e i n t r a d e re c e i v a b le s ( 7 , 9 6 1 ) ( 3 , 9 2 9 )
( I n c r e a s e ) / D e c r e a s e i n i n v e n t o r y ( 2 , 6 4 3 ) ( 1 , 7 7 0 )
I n c r e a s e / ( D e c r e a s e ) i n t r a d e p a y a b l e s 5 0 0 ( 5 , 0 0 0 )
N e t c a s h i n f l o w ( o u t f l o w ) f r o m o p e r a t i n g a c t i v i t i e s 4 , 9 7 0 2 , 4 7 6
C a s h f l o w s f r o m i n v e s t i n g a c t i v i t i e s
P a y m e n t s f o r p r o p e r t y , p l a n t a n d e q u i p m e n t ( 4 , 7 0 0 ) ( 4 9 0 )
R e p a y m e n t s of lo a n s g r a n t e d 8 0 0 -
D i v i d e n d s r e c e i v e d 5 2 0 5 4 0
I nt e r e s t a n d f i n a n c e l e a s e i n c o m e r e c e i v e d 1 0 9 2 0 0
F i n a n c e s u b le a s e r e c e i v a b le c o l l e c t e d 5 -
N e t c a s h i n f l o w ( o u t f l o w ) f r o m i n v e s t i n g a c t i vi t i e s ( 3 , 2 6 6 ) 2 5 0
C a s h f l o w s f r o m f i n a n c i n g a c t i v i t i e s
D i v i d e n d p a i d - ( 1 , 0 0 0 )
IFRS16p50 P a y m e n t s o f p r i n c i p a l o n l e a s e s N o t e 6 ( 3 , 1 5 3 ) -
IFRS16p50 P a y m e n t s o f i n t e r e s t o n l e a s e s N o t e 6 ( 5 2 2 ) -
P a y m e n t s o f le a s e t e r m i n a t i o n p e n a lt y N o t e 4 . 5 . 1 ( 3 0 0 ) -
P r o c e e d s f r o m b o r r o wi n g s N o t e 6 4 , 2 0 0
P a y m e n t s o f i n t e r e s t o n b o r r o w i n g s N o t e 6 ( 2 , 2 8 4 ) ( 1 , 1 3 0 )
N e t c a s h i n f l o w ( o u t f l o w ) f r o m f i n a n c i n g a c t i v i t i e s 2 , 0 5 9 ( 2 , 1 3 0 )
N e t i n c r e a s e / ( d e c r e a s e ) i n c a s h a n d c a s h e q u i v a l e n t s ( 3 5 6 ) 5 9 6
C a s h a n d c a s h e q u i v a le n t s a t t h e b e g i n n i n g o f t h e y e a r 8 0 0 2 0 4
C a s h a n d c a s h e q u i v a l e n t s a t t h e e n d o f t h e y e a r 4 4 4 8 0 0
Significant non-cash transactions (entering into new lease agreements) are disclosed in note 4.2.
Commentary
T h e o p e r a t i n g le a s e p a y m e n t s w e r e p r e s e n t e d i n 2 0 1 8 wi th i n o p e r a t i n g a c t i v i t i e s , w h e r e a s i n 2 0 1 9 a l l le a s e
p a y m e n t s a r e p r e s e nt e d b y l e s s e e wi t h i n fi n a n c i n g a c t i v i t i e s.
T h e l e s s e e c la s si f i e s le a s e p a y m e n t s c o n si s t e n t ly wi t h p a y m e n t s o f o t h e r f i n a n c i a l li a b i li t i e s i n t h e c a s h f l o w
s t a t e m e n t :
- T h e p a r t s o f t h e l e a s e p a y m e n t s t h a t r e p r e s e n t c a s h p a y m e n t s f o r t h e p r i n c i p a l p o r t i o n o f th e l e a s e li a b i li t i e s
a r e p r e s e nt e d a s c a s h f lo w s r e s u lt i n g f r o m f i n a n c i n g a c t i v i t i e s .
- T h e p a r t s o f t h e le a s e p a y m e n t s t h a t r e p r e s e n t t h e i n t e r e s t p or t i o n a r e p r e s e n t e d ei t h e r a s o p e r a t i n g c a s h
f lo w s o r a s c a s h f lo w s r e s u lt i ng f r o m f i n a n c i n g a c t i v i t i e s i n a c c o r d a n c e wi t h t h e e n t i t y’ s a c c o u nt i n g p o li c y i n
r e s p e c t of t h e p r e s e nt a t i o n o f in t e r e s t p a y m e n t s . L e a s e p a y m e n t s w h i c h w e r e n o t i n c lu d e d i n t h e m e a s u r e m e n t o f t h e l e a s e li a b i li t i e s ( i n c lu d i n g c e r t a i n v a r i a b l e
p a y m e n t s , s h o r t - t e r m l e a s e s a n d l e a s e s o f lo w - v a lu e a s s e t s ) c o n t i n u e t o b e p r e s e n t e d a s o p e r a t i n g c a s h f lo w s .
2. IFRS16 disclosures in the annual financial statements for 2019
Leases by lessee – Discover the IFRS16 disclosures – Case study 15
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
Notes to the financial statements
Note 1. Basis of preparation of the financial statements
These financial statements for the year ended 31 December 2019 have been prepared in accordance
with the International Financial Reporting Standards (“IFRS”) as adopted by the EU.
Note 2. Accounting policies [excerpt relating to IFRS16 only]
The accounting policies adopted are consistent with those of the previous financial year, except for the adoption of new and amended standards as set out below in Note 3. The new accounting policies applied from 1/1/2019 are stated in the relevant notes.
Note 3. New and amended standards adopted by the Company [excerpt relating to IFRS16
only]
The Company has adopted IFRS16 “Leases” from 1/1/2019, which has resulted in changes in the accounting policies and adjustments to the amounts recognised in the financial statements.
E f f e c t i v e d a t e a n d
tr a n si t i o n a l
p r o v i s i o n s
I F R S 1 6 w a s f i r s t i s s u e d i n J a n u a r y 2 0 1 6.
I n a c c o r d a n c e wi t h t h e t r a n s i tio n a l p r o v i s i o n s o f I F R S 1 6 , t h e C o m p a n y h a s a d o p t e d t h e n e w
g u i d a n c e a p p l y i n g a m o d i f i e d r e t r o s p e c t i v e a p p r o a c h wi t h th e c u m u l a t i v e e f f e c t o f i n i t i a l ly
a p p l y i n g t h i s s t a n d a r d a s a n a d j u s t m e n t t o t h e o p e n i n g b a la n c e o f r e t a i n e d e a r ni n g s i n t h e
p e r i o d o f i n i ti a l a p p li c a t i o n , i . e. 1/ 1 / 2 0 1 9 . C o m p a r a t i v e p r i o r y e a r p e ri o d s w e r e n o t r e s t a t e d .
E n t i t i e s a p p l y i n g t h e m o d i f i e d re t r o s p e c t i v e a p p r o a c h m a y a ls o e le c t t o u s e c e r t a i n p r a c t i c a l
e x p e d i e n t s .
S u m m a r y o f t h e
m a i n c h a n g e s
i nt r o d u c e d b y
t h e st a n d a r d
T h e n e w s t a n d a r d s e t s o u t t h e p r i n c i p l e s f o r t h e r e c o g n i t i o n , m e a s u r e m e n t , p r e s e n t a t i o n a n d
d i s c lo s u r e o f le a s e s . A ll le a s e s r e s u lt i n t h e l e s s e e r e c o g n i s i n g t h e r i g h t t o u s e a n a s s e t a t
t h e c o m m e n c e m e n t d a t e o f th e l e a s e , a n d i f le a s e p a y m e n t s a r e m a d e o v e r t i m e , a ls o
r e c o g n i s i n g f i n a n c i n g . A c c o r din g l y, I F R S 1 6 e li m i n a t e s t h e c la s si f i c a t i o n o f l e a s e s a s e i t h er
o p e r a t i n g l e a s e s o r fi n a n c e l e a s e s a s r e q u i r e d b y I A S 1 7 a n d , i n s t e a d , i nt r o d u c e s a s i n g le
le s s e e a c c o u n t i n g m o d e l. L e s s e e s wi l l b e r e q u i r e d t o r e c o g n is e : ( a ) a s s e t s a n d li a b i li t i e s f o r
a l l le a s e s wi t h a le a s e t e r m o f m o r e t h a n 1 2 m o n t h s , u n le s s t h e u n d e r l yi n g a s s e t i s o f lo w
v a lu e ; a n d ( b ) d e p r e ci a t i o n o f r i g h t - of - u s e a s s e t s s e p a r a t e l y f r o m i n t e r e s t o n le a s e li a bi li t i e s
i n p r o f i t o r lo s s . I F R S 1 6 s u b s t a n t i a ll y c a r r i e s f o r w a r d t h e l e s s o r a c c o u n t i n g r e q u i r e m e n t s f r o m
I A S 1 7 . A c c o r d i n g l y, a l e s s o r c o n t i n u e s t o c l a s s i f y i t s le a s e s a s o p e r a t i n g l e a s e s o r fi n a n c e
le a s e s , a n d t o a c c o u n t f o r t h o s e t w o t y p e s o f le a s e s di f f e r e n t ly . F o r s u b le a s e s , i nt e r m e d i a t e
le s s o r s s h o u l d c l a s s i f y s u b le a s e s b a s e d o n t h e r i g h t - o f - u s e a s s e t f r o m t h e h e a d le a s e , r a t h e r
t h a n t h e u n d e r l yi n g l e a s e a s s e t a s i t w a s u n d e r I A S 1 7 , t h u s t h e r e i s i n c r e a s e d li k e li h o o d
t h a t a sublease pr ev i o u s l y c l a s si f i e d a s o p e r a t i n g l e a s e wi l l b e c l a s s i f i e d a s a f i n a n c e l e a s e
u n d e r I F R S 1 6 .
Note 3.1. The effect from adoption of IFRS16 on the Company’s financial statements
IFRS16pC5(b) IFRS16pC7
The Company decided to implement the new standard retrospectively with the cumulative effect of initial application recognised as at the date of initial application of IFRS16, i.e. 1 January 2019 with the corresponding effects recorded in equity (retained earnings). This means that the data presented for 2018 and 2019 is not comparable.
IFRS16pC6 As required by the standard, this election has been consistently applied to all leases in which the Company is a lessee and sublessor.
2. IFRS16 disclosures in the annual financial statements for 2019
Leases by lessee – Discover the IFRS16 disclosures – Case study 16
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
Note 3.1. The effect from adoption of IFRS16 on the Company’s financial statements (cont.)
IFRS16pC8(a) IFRS16pC8(b)
Company as the lessee For all leases, except for short-term leases and leases of low-value assets other than those which are subleased, previously classified as operating leases:
• as at 1/1/2019 the Company has recognised a lease liability measured at the present value of the remaining lease payments, discounted using the Company’s incremental borrowing rate at 1/1/2019;
• for all leases the Company has elected to recognise a right-of-use asset at an amount equal to the lease liability, adjusted by the amount of prepaid or accrued lease payments relating to those leases recognised in the statement of financial position immediately before the date of initial application.
Low-value assets which are sub-leased are accounted for as a right-of-use asset with the corresponding lease liability.
Company as the lessor
The sublease of certain computers is classified as a finance lease. The Company derecognised the right-
of use asset (to the extent that it is subject to the sub-lease) and recognised a finance lease receivable
(net investment in the lease). The finance lease receivable is presented within “other assets” as the
amount is not material.
Sublease of an office space is classified as operating lease. The Company continues to recognise the
right-of-use asset resulting from the head lease. The subleased portion of right-of-use asset is classified
as investment property (subsequently measured applying the cost model). Revenue from the sublease
will be recognised over the term of the sublease.
IFRS16pC13 IFRS16pC10 IFRS16pC10(a) IFRS16pC10(b) IFRS16pC10(c)
The Company elected the following practical expedients:
• has applied a single discount rate to a portfolio of leases with reasonably similar characterisctics;
• relied on its assessment of whether leases are onerous applying IAS37 immediately before 1/1/2019 as an alternative to peforming an impairment analysis. The analysis of the onerous contracts as at 31/12/2018 has not resulted in a need to recognise an impairment allowance. The right-of-use assets as at 1/1/2019 were therefore not adjusted for any impairment;
• not to apply the new lessee accounting model to leases for which the lease term ends within 12 months after the date of initial application. Instead, it has accounted for those leases as short-term leases.
IFRS16pC12(b) The explanation of the difference between operating lease commitments disclosed as at 31/12/2018 when applying IAS17 to the lease liabilities recognised as at 1/1/2019 is presented in the table below:
(in EUR’000) 1/1/2019
IFRS16pC12(b) Operating lease commitments as at 31/12/2018 under IAS17 26,392 Leases previously not included (land) 3,488 Excluded short-term leases (19) Excluded low value assets (other than those which are subleased) (96) The effect of discounting using the incremental borrowing rate at 1/1/2019 (5,663) Lease liability as at 1/1/2019 24,102 Short-term portion 2,927 Long-term portion 21,175
2. IFRS16 disclosures in the annual financial statements for 2019
Leases by lessee – Discover the IFRS16 disclosures – Case study 17
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
The initial value of the right-of-use assets is determined as follows:
(in EUR’000) 1/1/2019
Amount equal to lease liability as at 1/1/2019 under IFRS16 24,102 Adjusted for: Lease prepayments recognised as of 31/12/2018 510 Accrued lease payments as of 31/12/2018 (20) Provision for onerous contracts - Reclassification to investment property (operating sublease of office building) (298) Reclassification to finance lease receivable (sublease of low-value assets) (10) Right-of-use asset as at 1/1/2019 24,284
The following line items were affected by the adjustments and reclassifications made with respect to the
amounts recognised at the date of initial application – 1/1/2019:
(in EUR’000) IAS17
31/12/2018 IFRS16
adjustments IFRS16
1/1/2019
Investment property - 298 298
Right-of-use assets - 24,284 24,284
Total non-current assets 22,878 24,592 47,470
Other assets 914 (500) 414
Total current assets 43 352 (500) 42 852
TOTAL ASSETS 66 230 24,092 90,322
Equity
Retained earnings 12 300 - 12 300
Total equity 18 677 - 18 677
Lease liabilities - 21,175 21,175
Non-current liabilities 38 553 21,175 59,728
Lease liabilities - 2,927 2,927
Trade and other payables 9 000 (20) 8 980
Current liabilities 9 000 2,907 11,907
TOTAL EQUITY AND LIABILITIES 66 230 24,082 90,312
IFRS16pC12(a) The weighted average incremental borrowing rate applied to measure lease liabilities is 6% for land and 4.5% for retail stores and office building.
2. IFRS16 disclosures in the annual financial statements for 2019
Leases by lessee – Discover the IFRS16 disclosures – Case study 18
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
Note 4. Leases - the Company as a lessee
IAS1p117
A c c o u n t i n g p o l i c i e s a p p l i e d fr o m 1 J a n u a r y 2 0 1 9
L e a s e s a r e r e c o g n i s e d a s r i g h t - of - u s e a s s e t s a n d c o r r e s p o n d i n g li a b i li t i e s at t h e d a t e a t w h i c h t h e l e a s e d a s s e t s
a r e a v a i la b le f o r u s e b y t h e C o m p a n y .
T h e r i g h t - o f - u s e a s s e t s i s p r e s e n t e d s e p a r a t e l y i n t h e s t at e m e n t o f fi n a n c i a l p o s i t i o n , e x c e pt f o r ri g h t - o f - u s e a s s e t s
t h a t m e e t t h e d e f i n i ti o n o f i n v e s t m e n t p r o p e r t y w h i c h i s p r e s e n t e d i n s t a t e m e n t o f f i n a n c i a l po s i ti o n i n s e p a r a t e li n e
it e m – “ i n v e s t m e n t p r o p e r t y ” .
A t t h e c o m m e n c e m e n t d a t e , lea s e li a b i li t i e s a r e m e a s u r e d a t a n a m o u n t e q u a l t o t h e p r e s e n t v a lu e o f t h e f o ll o w i n g
le a s e p a y m e n t s f o r t h e u n d e r ly i n g r i g h t - o f - u s e a s s e t s d u ri n g th e le a s e t e r m :
• f i x e d p a y m e n t s ( i n c lu d i n g i n - s u b s t a n c e f i x e d p a y m e n t s ) , le s s a n y le a s e i n c e n t i v e s r e c e i v a b le ;
• v a r i a b le l e a s e p a y m e n t s t h a t a r e b a s e d o n a n i n d e x o r a r a t e ;
• a m o u n t s e x p e c t e d t o b e p a y a b le b y t h e C o m p a n y u n d e r r e s id u a l v a lu e g u a r a n t e e s ;
• t h e e x e r c i s e p r i c e o f a p u r c h a s e o p t i o n i f t h e C o m p a n y i s r e a s o n a b l y c e r t a i n t o e x e r c i s e t h a t o p t i o n ;
• p a y m e n t s o f p e n a lt i e s f o r t e r m in a t i n g t h e le a s e , i f t h e l e a s e te r m r e f l e c t s t h e C o m p a n y e x e rc i si n g t h a t o p t i o n .
T h e l e a s e p a y m e n t s a r e d i s c o u nt e d u s i n g t h e i n t e r e s t r a t e i m p li c i t i n t h e l e a s e , i f t ha t r a t e c a n b e r e a d i l y
d e t e r m i n e d , o r t h e C o m p a n y ’ s i n c r e m e n t a l b o r r o wi n g r a t e .
E a c h le a s e p a y m e n t i s a ll o c a t e d b e t w e e n t h e li a b i li t y a n d f i n a n c e c o s t . L e a s e li a bi li t i e s a r e s u b s e q u e nt l y m e a s u r e d
u s i n g t h e e f f e c t i v e i nt e r e s t m e t h o d . T h e c a r r yi n g a m o u n t o f li a bi li t y i s r e m e a s u r e d t o r e f le c t a n y r e a s s e s s m e n t ,
le a s e m o d i f i c a t i o n o r r e v i s e d in - s u b s t a n c e f i x e d p a y m e n t s .
T h e le a s e t e r m i s a n o n - c a n c e l l a b le p e r i o d o f a le a s e ; p e rio d s c o v e r e d b y o p t i o n s t o e x t e n d a n d t e r m i n a t e t h e
le a s e a r e o n l y i n c lu d e d i n t h e le a s e t e r m i f i t i s r e a s o n a b l y c e rt a i n t h a t t h e le a s e wi l l b e e x t e n d e d o r n o t t e r m i n a t e d .
R i g h t - o f - u s e a s s e t s a r e m e a s u r e d i n i t i a l l y a t c o s t c o m p r i s i n g th e f o ll o wi n g :
• t h e a m o u n t o f t h e i n i ti a l m e a s u r e m e n t o f t h e l e a s e li a bi li t y ;
• a n y l e a s e p a y m e n t s m a d e a t o r b e f o r e t h e c o m m e n c e m e n t d a t e le s s a n y le a s e i n c e n t i v e s re c e i v e d ;
• a n y i n i ti a l d i r e c t c o s t s ;
• r e s t o r a t i o n c o s t s .
S u b s e q u e nt l y, t h e r i g h t - o f - u s e a s s e t s , a r e m e a s u r e d a t c o s t le s s a c c u m u l a t e d d e p r e c i at i o n a n d a n y a c c u m u l a t e d
i m p a i r m e n t l o s s e s , a n d a d j u s t e d f o r r e m e a s u r e m e n t o f t h e l e a s e li a bi li t y d u e t o r e a s s e s s m e n t o r l e a s e
m o d i f i c a t i o n s .
T h e r i g h t - o f - u s e a s s e t s a r e d e p r e c i a t e d o v e r t h e s h o r t e r of t h e a s s e t ’s u s e f u l li f e a n d t h e l e a s e t e r m o n a s t r a i g h t -
li n e b a si s . T h e a m o r t i s a t i o n p e ri o d s f o r t h e r i g h t - o f - u s e a s s e t s a r e a s f o l lo w s :
• r i g h t o f u s e f o r t h e l a n d 9 9 y e a r s
• r i g h t o f u s e f o r t h e r e t a i l s t o r e s 5 – 1 5 y e a r s
• r i g h t o f u s e f o r t h e o f fi c e b u i d in g 1 0 y e a r s
P a y m e n t s a s s o c i at e d wi t h a ll s h o r t - t e r m l e a s e s a n d c e r t a i n le a s e s o f a l l lo w - v a lu e a s s e t s a r e r e c o g n i s e d o n a
s t r a i g h t - li n e b a s i s a s a n e x p e n s e i n p r o f i t o r lo s s . T h e C o m p a n y a p p li e s t h e e x e m p t i o n f o r lo w - v a lu e a s s e t s o n a
le a s e - b y - l e a s e b a s i s i . e. f o r th e l e a s e s w h e r e t h e a s s e t i s s u b - l e a s e d , a r i g h t - o f - u s e a s s e t i s r e c o g n i s e d wi t h
c o r r e s p o n d i n g l e a s e li a b i li t y; f o r a ll o t h e r le a s e s o f lo w v a lu e a s s e t , t h e le a s e p a y m e n t s a s s o c i a t e d wi t h t h o s e
le a s e s wi l l b e r e c o g n i s e d a s a n e x p e n s e o n a s t r a i g h t - li n e b a s i s ov e r t h e le a s e t e r m .
S h o r t - t e r m l e a s e s a r e le a s e s w i t h a le a s e t e r m o f 1 2 m o n t h s o r le s s .
L o w - v a lu e a s s e t s c o m p r i s e c o m p u t e r s , t a b le t s , m o b i le p h o n e s a n d s m a l l i t e m s o f o f fi c e f u r n i t u r e .
A c c o u n t i n g p o l i c i e s a p p l i e d u n t i l 3 1 D e c e m b e r 2 0 1 8
L e a s e s i n w h i c h s u b s t a n t i a ll y a l l ri s k s a n d r e w a r d s o f o w n e r s h i p i s n o t t r a n s f e r r e d t o t h e C o m p a n y a s a le s s e e a r e
c l a s s i f i e d a s o p e r a t i n g l e a s e s . P a y m e n t s m a d e u n d e r o p e r a ti n g l e a s e s ( n e t o f a n y i n c e n t iv e s r e c e i v e d f r o m t h e
le s s o r ) a r e c h a r g e d t o p r o f i t o r lo s s o n a s t r a i g h t - li n e b a s i s o v e r t h e p e r i o d o f t h e le a s e .
2. IFRS16 disclosures in the annual financial statements for 2019
Leases by lessee – Discover the IFRS16 disclosures – Case study 19
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
IFRS16p59 Note 4.1. Lease activities
IFRS16p59(a)
The Company leases various properties (retail stores, office building, plot of land), delivery vans, other small equipment (e.g. computers, mobile phones). Leases are negotiated on an individual basis and contain a wide range of different terms and conditions (incl. termination and renewal rights). The main lease features are summarised below: • Retail stores are rented for a fixed period of 5 to 8 years. The contracts contain an option to renew
the lease. The lease payments are usually fixed plus a percentage of sales exceeding the predetermined level (a wide range of sales percentages and sales levels are applied).
• The land lease agreement is for 99 years with a cancellation notice period of 3 months. All payments are based on the value of the underlying land which is periodically adjusted for the property price index.
• The office building is rented for a fixed period of 10 years with an option to renew the contract. The lease payments are fixed and adjusted for inflation. 50% of the total office space is rented out to the related party (see further information in the Note 5).
• The delivery vans are leased for a fixed period of 1 year, with an extension option. • Small equipment (e.g. computers, mobile phones) is leased for a fixed period of 2 years with the
purchase option at fair value. Certain items of the computers are sublease to related party. IFRS16.p59(c)
The lease agreements do not impose any covenants, but leased assets may not be used as security for borrowing purposes.
IFRS16p59(b)
The future cash outflows to which the Company as a lessee is potentially exposed that are not reflected in the measurement of the lease liability arise from:
• Variable lease payments – see further information in Note 4.2. • Extension and termination options – see further information in Note 4.3.
The Company does not provide any residual value guarantees.
IFRS16p59, pB49
Note 4.2. Variable lease payments
All retail store lease contracts contain variable payment terms that are linked to sales generated from a
store. For individual stores, up to 100% of lease payments are on the basis of variable payment terms
and a wide range of sales percentages is applied. Variable lease payment terms are used for a variety of
reasons, and the primary reason is to minimise the fixed costs base for newly-established stores. In some
cases, payment terms also contain minimum annual payments and caps.
Variable lease payments that depend on sales are recognised in profit or loss in the period in which the
condition that triggers those payments occurs.
Lease payments for the year ended 31/12/2019 are summarised below:
IFRS16p59, pB49
(in EUR’000)
Number of stores
Fixed payments
Variable payments
Total payments
Fixed rent only 5 710 - 710
Variable rent with no minimum 1 - 130 130
Variable rent with minimum 19 2,290 81 2,371
25 3,000 211 2,311
A 1% increase in sales across all stores would be expected to increase total lease payments by
approximately 0.7%-0.9%. A 5% increase in sales across all stores would be expected to increase total
lease payments by approximately 3.3%- 3.8%.
2. IFRS16 disclosures in the annual financial statements for 2019
Leases by lessee – Discover the IFRS16 disclosures – Case study 20
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
IFRS16pB37 Note 4.3. Termination and extension option
IAS1p122 IFRS16p59(b)(ii)
C r i t i c a l j u d g m e n t s i n d e t e r m i ni n g t h e l e a s e t e r m
E x t e n s i o n a n d t e r m i n a t i o n o p t io n s a r e i n c lu d e d i n a n u m b e r o f p r o p e r t y le a s e s ( r e t a i l s t o r e s , la n d , of f i c e b u i ld i n g ) .
T h e s e t e r m s ar e u s e d t o m a x im i s e o p e r a t i o n a l f le x i b i li t y i n t e r m s o f m a n a g i n g c o n t r a c t s. T h e m a j o r i t y o f e x t e n s i o n
a n d t e r m i n a t i o n o p t i o n s h e ld a r e e x e r c i s a b le o n l y b y t h e C o m p a n y a n d n o t b y t h e r e s p e c t iv e le s s o r .
I n d e t e r m i ni n g t h e l e a s e t e r m , m a n a g e m e n t c o n s i d e r s a ll f a c t s a n d c i r c u m s t a n c e s t h a t c r e a te a n e c o n o m i c i n c e n t i v e
t o e x e r c i s e a n e x t e n s i o n o p t i o n , o r n o t e x e r c i s e a t e r m i n a t i o n o p t i o n . E x t e n s i o n o p t i o n s ( o r p e r i o d s a f t e r t e r m i n a t i o n
o p t i o n s ) a r e o n l y i n c lu d e d i n th e l e a s e t e r m i f t h e le a s e i s r e a s o n a b l y c e r t a i n t o b e e x t e n d e d ( e x t e n t i o n o p t i o n ) o r
n o t t e r m i n a t e d ( t e r m i n a t i o n o p t i o n) . T h e a s s e s s m e n t o f w h e t h e r t h e C o m p a n y i s r e a s o n a b l y c e r t a i n t o e x e r c i s e a n
e x t e n t i o n o p t i o n , o r n o t t o e x e r c i s e a t e r m i n a t i o n o p t i o n i s r e v ie w e d i f a s i g n i f i c a n t e v e n t o r a s i g ni f i c a n t c h a n g e i n
c i r c u m s t a n c e s o c c u r s w h i c h a f f ec t s t h i s a s s e s s m e n t a n d i s w ith i n t h e c o n t r o l o f t h e C o m p a n y.
T h e m a n a g e m e n t h a s a p p li e d j u d g m e n t t h a t :
• F o r t h e r e t a i l s t o r e s w h i c h a r e i n t h e s t r at e g i c l o c a t i o n s (a p p r o x . 4 0 % o f a ll t h e C o m p a n y’ s st o r e s ) i t i s
r e a s o n a b l y c e r t a i n t h a t t h e e x t e n si o n o p t i o n wi l l b e e x e r c i s e d r e s u lt i n g i n a t o t a l le a s e t e r m o f 1 0 - 1 5 y e a r s ,
w h e r a s f o r t h e r e m a i n i n g p r o p e r t i e s t h e e x t e n t i o n p e r i o d w a s n o t i n c lu d e d i n t h e l e a s e t e r m a s t h e r e a r e n o
e c o n o m i c i n c e n t i v e s t o e x e r c i s e t h e o p t i o n .
• T h e t e r m i n a t i o n o p t i o n i n t h e la n d le a s e a g r e e m e n t wi l l n o t b e e x e r c i s e d a s t h e C o m p a n y h a s e c o n o m i c
i n c e n t i v e t o c o n t i n u e t h e l e a s e o f la n d o n w h i c h t h e C o m p a n y ’ s m ai n m a n u f a c t u r i n g f a c i li ty a n d w a r e h o u s e s
a r e l o c a t e d . T h e r e f o r e t h e le a s e t e r m o f 9 9 y e a r s i s u s e d .
• F o r t h e o f f i c e b u i ld i n g t h e e x te n t i o n o p t i o n w a s n o t i n c lu d e d a s i t i s n o t r e a s o n a b l y c e r t a i n t h a t t h e C o m p a n y
w i l l c o n t i n u e t h e l e a s e b e y o n d t h e 1 0 - y e a r p e ri o d .
• T h e le a s e t e r m o f v a n s w a s a s s e s s e d a s a s h o r t - t e r m l e a s e as t h e a lt e r n a t i v e a s s e t s a r e e a s i l y a v ai l a b le a n d
t h er e a r e n o e c o n o m i c i n c e n t i v e s t o c o n t i n u e b e y o n d t h e b a si c p e ri o d o f 1 2 m o n t h s .
T h e m o s t s i g n i fi c a n t i m p a c t of th e m a n a g e m e n t ’ s a s s e s s m e n t r e g a r d i n g t h e n o n - u s e o f t h e e x t e n t i o n o p t i o n s r e la t e s
t o t h e r et a i l s t o r e r e n t a l s . T h e ta b l e b e lo w s u m m a r i s e s p o t e n t i a l f ut u r e r e n t a l p a y m e n t s r e la t in g t o p e ri o d s f o l lo wi n g
t h e e x e r c i s e d a t e s o f e x t e n t i on o p t i o n s i n t h e c o n t r a c t s f o r th e r et a i l s t o r e s , w h e n t h e e x te n t i o n p e r i o d s w e r e n o t
r e f le c t e d i n t h e le a s e t e r m :
31/12/2019 1/01/2019 31/12/2019 1/01/2019
Lease liability
recognised (discounted)
Potential future lease payments not included in lease liabilities
(discounted)
Lease liability
recognised (discounted)
Potential future lease payments not included in lease liabilities
(discounted)
Historical rate of exercise of extension options
%
Retail stores in the strategic location
10,100 -- 9,050 -- 98% 97%
Retail stores – all other locations
12,140 8,900 10,110 7,850 45% 43%
22,240 8,900 19,160 7,850
D u r i n g t h e c u r r e n t f i n a n c i a l y e a r , t h e f i n a n c i a l e f f e c t of r e v i si n g l e a s e t e r m s t o r e f l e c t th e e f f e c t o f e x e r c i s i n g
e x t e n s i o n o p t i o n s n o t p r e v i o u s ly i n c lu d e d i n t h e l e a s e t e r m w a s a n i n c r e a s e i n r e c o g n i s e d le a s e li a b i li t i e s a n d r i g h t -
o f - u s e a s s e t s of E U R 1 , 2 5 0 t h o u s a n d .
I n t o t a l, p o t e n t i a l f ut u r e c a s h o u t f lo w s o f E U R 1 1 , 0 0 0 t h o u s a n d h a v e n o t b e e n i n c lu d e d i n t h e l e a s e li a b i li t y b e c a u s e
it i s n o t r e a s o n a b l y c e r t a i n t h a t t h e le a s e s wi l l b e e x t e n d e d ( o r n o t t e r m i n a t e d ) .
IFRS16pB48
IFRS 16p55 Note 4.4. Short-term leases
Leases of vans are short-term leases and the costs are recognised on a straight-line basis during the reporting period. The total cost of short-term leases is disclosed in Note 4.5. The total amount of Company’s lease commitments for short-term leases equals to EUR 70 thousand.
Note 4.5. Amounts recognised in the statement of financial position
2. IFRS16 disclosures in the annual financial statements for 2019
Leases by lessee – Discover the IFRS16 disclosures – Case study 21
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
Note. 4.5.1. Right-of-use assets
The statement of financial position shows the separate line item for the right-of-use assets, which comprises the following:
(in EUR’000) Notes IFRS16
31/12/2019 IFRS16
1/01/2019
IFRS16p53(j) Right-of-use assets (by class of assets) Retail stores 22,893 20,507 Buildings 268 298 Land 3,450 3,488
26,610 24,294
(in EUR’000)
Notes Retail store Buildings Land Total
Balance at 31/12/2018 - - - -
IFRS16 adjustment Note 3 20,507 298 3,488 24,294
Balance at 1/1/2019 20,507 298 3,488 24,294 IFRS16p53(h)
Additions – new lease contracts 4,950 - - 4,950
Termination of the lease contract (700) - - (700)
Depreciation (1,864) (30) (39) (1,933)
Balance at 31/12/2019 – IFRS16 22,893 268 3,450 26,610
In the current reporting period, the Company has terminated lease contracts for two retail stores as the result of the Management strategic decision to withdraw from the particular geographical area. The early termination resulted in a loss of EUR 210 thousand (presented in “losses on early termination of the leases”) which is the net effect of the derecognition of the carrying amount of righ-of-use asset of EUR 700 thousand, derecognition of corresponding lease liability of EUR 790 thousand and payment of the penalty of EUR 300 thousand. Note. 4.5.2. Investment property (right-of-use asset)
IAS1p117
A c c o u n t i n g p o l i c i e s a p p l i e d fr o m 1 J a n u a r y 2 0 1 9
T h e p r o p e r t y ( b ui l d i n g ) h e ld b y t h e C o m p a n y ( a s r i g h t - o f - u s e a s s e t s ) t o e a r n r e n t a ls i s c la s s i f i e d a s i nv e s t m e n t
p r o p e r t y . T h e C o m p a n y m e a s u r e s i t s i n v e s t m e n t p r o p e r t y a p p l yi n g t h e c o s t m o d e l. F o r t he i nv e s t m e n t p r o p e r t y
h e l d b y t h e C o m p a n y a s a r i gh t - o f - u s e a s s e t , t h e c o s t f o r i n iti a l a n d s u b s e q u e n t m e a s u r e m e n t i s d e t e r m i n e d i n
a c c o r d a n c e wi t h t h e a c c o u n t i n g p o li c y st a t e d i n t h e N ot e 4 .
A c c o u n t i n g p o l i c i e s a p p l i e d u n t i l 3 1 D e c e m b e r 2 0 1 8
N o t a p p li c a b le .
The Company subleases 50% of its whole office space to the related party. The sublease is classified as operating lease (further information is presented in the Note 5). The subleased portion of an office building is presented as investment property in a statement of financial position.
(in EUR’000)
Notes Investment
property
Balance at 31/12/2018 -
IFRS16 adjustment Note 3 298
Balance at 1/1/2019 298
Depreciation (30)
Balance at 31/12/2019 – IFRS16 268
Commentary
F o r t h e i nv e s t m e n t p r o p e r t y le a s e d o u t , I F R S 1 6 p a r . 9 6 r e q u i r e s t o a p p l y t h e di s c lo s u r e re q u i r e m e n t s o f I A S 4 0 .
F o r t h e p u r p o s e o f t h i s C a s e St u d y P u b li c a t i o n , w e d o n o t p r e s e n t f u ll d i s c lo s u r e w h i c h w o u l d b e r e q u i r e d b y I A S 4 0 .
2. IFRS16 disclosures in the annual financial statements for 2019
Leases by lessee – Discover the IFRS16 disclosures – Case study 22
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
IFRS16p53
Note 4.6. Amounts relating to leases recognised for the reporting period The following amounts are recognised in profit or loss
(in EUR’000) Notes IFRS16
2019 IAS17 2018
IFRS16p53(a) Depreciation charge for the right-of-use assets by class of assets
Buildings 1,894 -
Land 39 -
Note 4.5.1 1,933 -
Depreciation charge for the investment property Note 4.5.2 30
Total depreciation charge 1,963
IFRS16p53(b)
Interest expense on lease liabilities (included in finance cost) 1,446 -
IFRS16p53(c) Expense relating to short-term leases - vans (included in distribution expenses) 60
-
IFRS16p53(d) Expense relating to leases of low-value assets that are not short-term leases (included in administrative and distribution expenses) 190
-
IFRS16p53p(e) Expense relating to variable lease payments not included in lease liabilities (included in distribution expenses) 211
-
Loss on termination of lease contract 210
Operating lease expense (IAS17) (included in administrative and distribution expenses) - 2,465
Total expenses related to leases 4,273 2,465
The following amounts are recognised in the cash flow statement
(in EUR’000) Notes IFRS16
2019 IAS17 2018
IFRS16p53)(g) Cash outflow for leases (IFRS16) – financing activity Principal Note 6 2,229 - Interest Note 6 1,446 - Termination penalty Note 4.5.1 300 -
3,975 -
Cash outflow for leases – operating activity 461 2,600
Total cash outflows 4,045 2,600
Note 4.5.3. Lease liabilities
(in EUR’000) Notes IFRS16
31/12/2019 IFRS16
1/01/2019
IFRS16p47(b) Lease liabilities Short-term portion 3,400 2,927 Long-term portion 22,632 21,175
Note 6 26,032 24,102
2. IFRS16 disclosures in the annual financial statements for 2019
Leases by lessee – Discover the IFRS16 disclosures – Case study 23
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
Note 5 Lease – the Company as a sublessor
IAS1p117
A c c o u n t i n g p o l i c i e s a p p l i e d fr o m 1 J a n u a r y 2 0 1 9
T h e C o m p a n y i s a s u b - l e s s o r ( i nt e r m e d i a t e l e s s o r ) o f t h e r i g h t - of - u s e a s s e t s .
A n i n t e r m e d i a t e l e s s o r c l a s s i f ie s t h e s u b le a s e a s a f i n a n c e le a s e o r a n o p e r a t i n g le a s e a s f o ll o w s :
• i f t h e h e a d l e a s e i s a s h o r t - t e r m l e a s e t h a t t h e e n t i t y, a s a le s s e e , h a s a c c o u n t e d f o r a s s t a t e d i n t h e N o t e 4,
t h e s u b le a s e i s c l a s s i fi e d a s a n o p e r a t i n g l e a s e ,
• o t h e r wi s e , t h e s u b le a s e i s c la s si f i e d b y r e f e r e n c e t o t h e r i g h t -o f - u s e a s s e t a r i s i n g f r o m t h e h e a d le a s e , r a t h e r
t h a n b y r e f e r e n c e t o t h e u n d e r ly i n g a s s e t . A le a s e i s c l a s s i f i ed a s a f i n a n c e l e a s e i f i t t r a n s f e r s s u b s t a n t i a ll y
a l l t h e r i s k s a n d r e w a r d s f r o m t h e r i g h t - o f - u s e a s s e t r e s u lt i n g fr o m t h e h e a d l e a s e ; o t h e r wi s e , i t i s c l a s s i f i e d
a s a n o p e r a t i n g le a s e .
F o r s u b le a s e s c l a s si f i e d a s f i na n c e le a s e , t h e i nt e r m e d i a t e le s s o r d e r e c o g n i s e s t h e r i g h t - o f -u s e a s s e t r e l a t i n g t o
t h e h e a d l e a s e t h a t i s t r a n s f e r s t o t h e s u b le s s e e a n d r e c o g n i s e s t h e n e t i n v e s t m e n t i n t h e s u b le a s e ; a n y di f f e r e n c e
b e t w e e n t h e r i g h t - o f - u s e a s s e t s a n d t h e n e t i n v e s t m e n t i n t h e f i n a n c e s u b le a s e i s r e c o g n i s e d i n p r o f i t o r lo s s . A t
t h e c o m m e n c e m e n t d a t e , n e t i n v e s t m e n t i n t h e f i n a n c e l e a s e i s m e a s u r e d a t a n a m o u n t e q u a l t o t h e p r e s e n t
v a lu e o f t h e le a s e p a y m e n t s fo r t h e u n d e r l yi n g r i g h t - of - u s e a s s e t s d ur i n g t h e l e a s e t e r m (t h e l e a s e p a y m e n t s
i n c lu d e d i n t h e m e a s u r e m e n t a r e t h e s a m e a s di s c lo s e d i n th e N o t e 4 f o r t h e l e a s e c o n t r a c t w h e r e t h e C o m p a n y
is a le s s e e ) . T h e l e s s o r r e c o g n i s e s f i n a n c e i n c o m e o v e r t h e le a s e t e r m , b a s e d o n a p a t t e r n r ef le c t i n g a c o n s t a n t
p e r i o d r a t e o f r et u r n o n t h e le s s o r ’ s n e t i n v e s t m e n t i n t h e l e a s e .
F o r s u b le a s e s c l a s s i fi e d a s o p e r a t i n g l e a s e , t h e i nt e r m e d i a t e le s s o r r e c o g n i s e s t h e l e a s e i n c o m e f r o m o p e r a t i n g
le a s e s o n a s t r a i g h t - li n e b a s i s ov e r t h e le a s e t e r m . T h e r e s p e c t i v e l e a s e d a s s e t i s i n c lu d e d i n t h e s t a t e m e n t o f
fi n a n c i a l p o s i t i o n b a s e d o n i t s n a t u r e .
A c c o u n t i n g p o l i c i e s a p p l i e d u n t i l 3 1 D e c e m b e r 2 0 1 8
T h e C o m p a n y i s a s u b - l e s s o r o f t h e a s s e t s l e a s e d u n d e r h e a d o p e r a t i n g l e a s e c o n t r a c t s. T h o s e s u b le a s e s a r e
c l a s s i f i e d a s o p e r a t i n g l e a s e s . L e a s e i n c o m e f r o m o p e r a t i n g le a s e s w h e r e t h e C o m p a n y i s a le s s o r i s r e c o g n i s e d
o n a s t r a i g h t - li n e b a s i s o v e r t h e l e a s e t e r m .
IFRS16p92
The Company is an intermediate lessor in incidental situations. It subleased to its related party 50% of its whole office space and some of its computers (head leases). The sub-lease of office space is for 5 years and is classified as operating lease.The sublease payments are fixed and matches the payments under the head lease. The portion of the right-of-use asset, which is leased out, is presented as investment property (Note 4.5.2). The sub-lease of the computers is for the same period as head lease (i.e. 2 years) and is classified as a finance lease. The sublease payments are fixed and match the payments under the head lease.
The following amounts are recognised in profit or loss:
(in EUR’000) Notes IFRS16
2019 IAS17 2018
IFRS16p90(a)(ii) Finance leases
Interest income on the net investment in the lease 1 -
1 -
IFRS16p90(b)
Operating leases
Lease income – fixed payments 42 47
Total income related to leases 43 47
2. IFRS16 disclosures in the annual financial statements for 2019
Leases by lessee – Discover the IFRS16 disclosures – Case study 24
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
IFRS16p97
The future minimum lease payments in relation to non-cancellable operating leases are as follows:
(in EUR’000)
31/12/2019
Future minimum lease payments in relation to non-cancellable operating suleases leases are receivable as follows:
Within one year 42
Later than one year but not later than five years 120
Later than five years -
Total 162
Commentary
I F R S 1 6 p a r . 8 9 - 9 7 p r o v i d e s m o r e d i s c lo s u r e r e q u i r e m e n t s f o r le s s o r t h a n i l lu s t r a t e d i n o u r C a s e S t u d y P u b li c a t i o n
a s t h e p u b li c a t i o n i s n o t d e s i g n e d f o r le s s o r s . O u r f i c t i o n a l C o m p a n y p r e s e n t s o n l y li m i t e d d i s c lo s u r e o n t h e b a s i s
o f m a t er i a li t y a s t h e s u b le a s e s a r e i n c i d e n t a l t o t h e C o m p a n y ’ s o p e r a t i o n ; f o r e x a m p le , th e C o m p a n y d o e s n o t
p r e s e n t t h e m a t u ri t y a n a l y s i s of t h e le a s e p a y m e n t s r e c ei v a b le a n d r e c o n c i li a t i o n o f t he u n d i s c o u n t e d l e a s e
p a y m e n t s t o t h e n e t i n v e s t m e n t i n t h e le a s e a s t h e a m o u n t s a r e n o t m a t er i a l .
Note 6 Debt (extract)
Note 6.1 Debt reconciliation
The table below analyses the movement in debt for each of the periods presented.
(in EUR’000)
Notes Borrowings Lease
liabilities Total debt
Cash and cash
equivalents Net debt
Balance at 1/1/2018 (38,500) - (38,500) 204 (38,296)
Cash flows 1,130 - 1,130 596 1,726
Interest accrued Note 8 (1,130) - (1,130) - (1,130)
Balance at 31/12/2018 (38,500) - (38,500) 800 (37,700)
IFRS16 adjustment Note 3 (24,102) (24,102) - (24,102)
Balance at 1/1/2019 (38,500) (24,102) (62,602) 800 (61,802)
Cash flows (1,916) 3,675 1,759 (103) 1,656
New lease contracts - (4,950) (4,950) - (4,950)
Termination of the lease contract Note 4.5.1 - 790 790 - 790
Interest accrued Note 8 (2,284) (1,446) (3,730) - (3,730)
Foreign exchange adjustments (600) - (600) - (600)
Balance at 31/12/2019 Note 4.5.3, 10 (43,300) (26,032) (69,332) 697 (68,635)
Commentary
I A S 7 p a r . 4 4 A - 4 4 E r e q u i r e s t h e di s c lo s u r e o f c h a n g e s i n li a b i li t i e s a r s i n g f r o m f i n a n c i n g a c t iv i t i e s ( i . e. t h e li a b i li t i e s
f o r w h i c h c a s h f lo w s a r e c l a s si fi e d i n t h e st a t e m e n t o f c a s h f lo w s a s c a s h f lo w s f r o m f i n a n c in g a c t i v i t i e s ) , i n c lu d i n g
b o t h c h a n g e s a r i s i n g f r o m c a s h f lo w s a n d n o n - c a s h c h a n g e s .
T h e le a s e li a b i li t y r e c o g n i s e d a s a r e s u lt of t h e a p p li c a t i o n o f IF R S 1 6 s h o u ld b e c o v e r e d b y th i s d i s c lo s u r e .
T h e i l lu s t r at i v e d i s c lo s u r e s p r e s e n t e d a b o v e , s h o w t h e d e bt a n d t h e n e t d e b t r e c o n c i li a t i o n ( i . e. d e b t le s s c a s h a n d
c a s h e q u i v a le n t s ) . A s o p p o s e d t o d e b t , t h e n e t d e b t i s a n o n - G A A P m e a s u r e , t h e r e f o r e , t h e d i s c lo s u r e r e q u i r e d f o r
n o n - G A A P m e a s u r e s s h o u l d b e p r o v i d e d ( s e e f u r t h e r d i s c u s si o n s i n N o t e 7 ) .
IFRS16p93 Finance sublease receivable (net investment in a finance lease) amounts to EUR 6 thousand as at 31/12/2019 (1/1/2019: EUR 10 thousand). The interest income recognised in the current period is disclosed in the table above. The payment of EUR 5 thousand obtained in the current period is presented as investing activity in cash flow statement.
2. IFRS16 disclosures in the annual financial statements for 2019
Leases by lessee – Discover the IFRS16 disclosures – Case study 25
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
Note 7. Alternative performance measures used by the Management
The Management uses the following measures to assess the performance and financial position of the
Company: EBITDA (earnings before interest, taxes, depreciation and amortisation), EBITDAR (earnings
before interest, taxes, depreciation, amortization, and rent costs) and net debt.
EBITDA is a measure on the basis of which the Management takes economic decisions, decides about
the allocation of resources (incl. decides about investments in new products). EBITDA is also a measure
provided to investors and analysts.
EBITDAR is a measure which is not used regularly by the Management, nevertheless due to the fact that
EBITDA calculated for the year 2019 and 2018 is not comparable as the result of the first application of
IFRS16 (further details provided in the Note 3), the Management provides EBITDAR to ensure
comparability of the profit measure between the presented periods. Management does not intend to
present EBITDAR in the following years.
Net debt is used by the Management due to the bank covenants which require to maintain net debt at
certain level. The definition of the net debt is the same as in the bank loan agreement.
The Company defines EBITDA as profit/(loss) for the period, as determined in accordance with IFRS, before depreciation and amortisation, impairment losses recognised/reversed on property, plant and equipment, intangible assets and right-of-use assets, interest income, finance expense, foreign exchange gains and losses and income taxes.
EBITDAR is defined as profit/(loss) for the period, as determined in accordance with IFRS, before depreciation and amortisation, impairment losses recognised/reversed on property, plant and equipment, intangible assets and right-of-use assets, interest income, finance expense, foreign exchange gains and losses, income taxes, expense relating to leases not included in the measurement of the lease liability (i.e. for IFRS16: short term leases, low-value assets, variable lease payments not based on rate or index; for IAS17: operating lease expense), gains/loss on termination of the lease contracts .
The Company defines the net debt as the carrying amount of the borrowings and lease liabilities (liabilities for which cash flows are classified in the statement of cash flows as cash flows from financing activities) at the reporting date less cash and cash equivalents.
EBITDA, EBITDAR and net debt are not IFRS measures and should not be considered as an alternative to IFRS measures of profit/(loss) for the period or financial position at the end of the period, as an indicator of operating performance, as a measure of cash flows from operations under IFRS, or as an indicator of liquidity. EBITDA, EBITDAR and net debt are not a uniform or standardized measure and the calculation of these measures, accordingly, may vary significantly from one entity to another, and by itself the Company’s presentation and calculation of EBITDA, EBITDAR and net debt may not be comparable to that of other entities.
Reconciliation of net debt to debt (total liabilities from financing activity) is presented in Note 5.1.
Reconciliation of EBITDA and EBITDAR to profit/(loss) before income tax is presented below:
(in EUR’000) Notes 31/12/2019 31/12/2018
Profit for the period 8,824 9,795 Depreciation and amortisation 2,863 660 Interest income (109) (200) Loss on termination of the lease Note 4.5.1 210 Finance costs Note 8 3,730 1,980 Income tax expense 2,109 2,301 EBITDA 17,627 14,536 Expenses relating to leases not included in the measurement of the
lease liability Note 4.6 461 2,465
EBITDAR 18,088 17,001
2. IFRS16 disclosures in the annual financial statements for 2019
Leases by lessee – Discover the IFRS16 disclosures – Case study 26
Copy for: participant of IFRS 16: Leases - Annual IFRS Update Training 2019
Commentary
I n J u n e 2 0 1 5 t h e E u r o p e a n S e c u r i t i e s a n d M a r k e t s A ut h o r i t y ( E S M A ) i s s u e d t h e “ G ui d e li n e s o n A lt e r n a t i v e
P e r f o r m a n c e M e a s u r e s ( A P M s ) ” f o r li s t e d i s s u e r s . T h e o b j e c t iv e o f t h e g u i d e li n e s i s t o e n c o u r a g e E u r o p e a n i s s u e r s
t o p u b li s h t r a n s p a r e n t , u n b i a s e d a n d c o m p a r a b l e i n f o r m a t i o n o n t h e i r f i n a n c i a l p e r f o r m a n c e . T h i s s h o u ld p r o v i d e
u s e r s wi t h a c o m p r e h e n s i v e u n d e r s t a n d i n g o f t h e i r p e r f o r m a n c e .
A P M i s “ a fi n a n c i a l m e a s u r e o f h i s t o r i c a l o r f u t u r e p e r f o r m a n c e s , f i n a n ci a l p o s i ti o n , o r c a s h f l o w s , o t h e r t h a n a
fi n a n c i a l m e a s u r e d e f i n e d o r s p e c i f i e d i n t h e a p p li c a b le f i na n c i a l r e p o r t i n g f r a m e w o r k ” . T h a t i s , a n A P M i s a
p e r f o r m a n c e m e a s u r e w h i c h i s n o t d e f i n e d o r s p e c i f i e d i n t h e G A A P u n d e r w h i c h t h e e n t i t y is r e p o r t i n g . E x a m p le s
o f A P M s m o s t c o m m o n l y u s e d i n c lu d e E B I T ( E a r ni n g s B e f o r e In t e r e s t & T a x ) , E B I T D A ( E a r ni n g s B e f o r e I n t e r e s t ,
T a x e s , D e p r e ci a t i o n a n d A m o r ti s a t i o n ) , f r e e c a s h f lo w, a n d u n d e r l yi n g p r o f i t o r n e t d e b t .
W h e r e e n t i t i e s u s e A P M s i n a r e le v a n t d o c u m e n t , t h e y s h o u ld d i s c lo s e t h e d e f i n i t i o n s o f e a c h A P M i n a c l e a r a n d
r e a d a b le w a y , i n c lu d i n g t h e i r c o m p o n e n t s , t h e b a si s o f c a lc u la t i o n s a n d a n y m a t e ri a l h y p o t h e s e s o r a s s u m p t i o n s
u s e d. T h e y s h o u ld g i v e A P M s m e a n i n g f u l la b e l s r e f le c t i n g t h e i r c o n t e n t a n d t h e b a s i s o f c a lc u la t i o n .
E n t i t i e s s h o u l d i n c lu d e a r e c o n c i li a t i o n of e a c h A P M t o th e a m o u n t s p r e s e n t e d i n t h e fi n a n c i a l s t a t e m e n t s ,
s e p a r a t e l y i d e n t i f yi n g a n d e x p la i n i n g t h e m a t e r i a l r e c o n c i li n g i t e m s. U s e r s s h o u ld b e a b le t o id e n t i f y t h e r e c o n c i li n g
it e m s i n t h e f i n a n c i a l s t a t e m e n ts. W h e r e a n a m o u n t c a n n o t b e e x t r a c t e d di r e c t ly f r o m t h e f i na n c i a l s t a t e m e n t s , t h e
e n t i t y s h o u ld d i s c lo s e h o w i t i s c a lc u la t e d .
A n e n t i t y s h o u ld e x p la i n w h y it u s e s A P M s , t o e n a b l e u s e rs t o u n d e r s t a n d t h e i r r e l e v a n c e a n d r e li a bi li t y – i n
p a r t i c u la r w h y t h e e n t i t y b e li e v e s t h a t a n A P M p r o v i d e s u s e f u l i n f o r m a t i o n o n i t s fi n a n c i a l p o s i t i o n , c a s h f lo w s o r
fi n a n c i a l p e r f o r m a n c e , t o g e t h e r wi t h t h e p u r p o s e s f o r w h i c h i t u s e s t h e s p e c i f i c A P M wi t h i n th e b u s i n e s s .
E n t i t i e s s h o u ld n o t d i s p la y A P M s wi t h m o r e p r o m i n e n c e , e m p h a s i s o r a u t h o r i t y t h a n , n o r d is t r a c t f r o m , m e a s u r e s
d i r e c t l y s t e m m i n g f r o m f i n a n c ia l s t a t e m e n t s .
E n t i t i e s s h o u l d m a i n t a i n c o n s i s t e n t d e f i n i ti o n s a n d c a lc u la t i o n s o f A P M s o v e r t i m e .
I n e x c e p t i o n a l c i r c u m s t a n c e s w h e r e e n t i t y d e ci d e s t o r e d e f i ne a n A P M , i t s h o u ld e x p la i n t h e c h a n g e s , e x p la i n t h e
r e a s o n s w h y t h e s e c h a n g e s re s u lt i n r e li a b le a n d m o r e r e le v a nt i nf o r m a t i o n o n t h e f i n a n c i a l p e r f o r m a n c e , a n d
p r o v i d e r e s t at e d c o m p a r a t i v e f i g ur e s .
If a n i s s u e r s t o p s di s c lo s i n g a n A P M , t h e i s s u e r s h o u ld e x p la in t h e r e a s o n f o r c o n s i d e ri n g t h a t t h i s A P M n o l o n g e r
p r o v i d e s r e le v a nt i nf o r m a t i o n .
Note 8. Financial risk management (extract)
The tables below analyse the financial liabilities into relevant maturity groupings based on their contractual
maturities. The amounts disclosed in the table are the contractual undiscounted cash flows.
(in EUR’000) At 31/12/2019
Less than 6
months
6–12
months
1–2
years
2–5
years
Over 5 years
Total contractual cash flows
Carrying amount
Trade payables 9,500 - - - - 9,500 9,500
Borrowings 5,858 981 1,963 5,889 40,463 55,154 43,300 IFRS16p58
Lease liabilities 1,600 1,623 3,153 9,460 13,476 29,312 26,033
16,958 2,604 5,116 15,349 53,939 93,966 78,832
IFRS16p59(b)
T h e l e a s e li a b i li t i e s d o n o t i n c lu d e v a r i a b le le a s e p a y m e n t s w h i c h a r e n o t b a s e d o n a ra t e o r i n d e x ( i . e. % o f
r ev e n u e g e n e r a t e d b y s t o r e s ) . E s t i m at e d f ut u r e v a r i a b le l e a s e p a y m e n t s a m o u n t t o E U R 1 , 7 0 0 t h o u s a n d . T h e r e
w e r e n o l e a s e s n o t y e t c o m m e n c e d t o w h i c h t h e C o m p a n y i s c o m m i t t e d , o t h e r t h a n t h o s e di s c lo s e d i n N o t e 4 . 3 .
(in EUR’000) At 31/12/2018
Less than 6 months
6–12
months
1–2
years
2–5
years
Over 5 years
Total contractual cash flows
Carrying amount
Trade payables 9,000 - - - - 9,000 9,000
Borrowings 960 960 1,920 5,760 42,340 51,940 38,500
9,960 960 1,920 5,760 42,340 60,940 47,500
T o m a s z K o n i e c z n y
P a r t n e r [email protected]
From the author, This is our third publication in a series of publications relating to disclosures resulting from new standards. The preparation of meaningful and comprehensive disclosures is a challenging task, therefore we present you with a publication which is aimed at helping you in the preparation of your first disclosures under IFRS16. We hope you find this publication useful. The previous publications issued in 2018 cover disclosures required by IFRS9 “Financial Instruments” and IFRS15 “Revenue from Contracts with Customers”. Both publications are available on www.pwc.pl. Some other PwC publications or resources mentioned below on this page may be of assistance to you.
Publications and PwC resources relating to IFRS, which may be useful in the preparation of financial statements for 2019
I F R S I l l u s t r at i v e
c o n s o li d a t e d
fi n a n c i a l
s t a t e m e n t s
I F R S D i s c lo s u r e
c h e c k li s t I nf o r m - o n li n e
r e s o u r c e .
A u t h o r i t a t i v e
li t e r at u r e f o r
I F R S a n d
P w C ’ s g ui d a n c e
I F R S 9 ,
F i n a n c i a l
I n s t r u m e n t s .
U n d e r s t a n d i n g
t h e b a s i c s
R e v e n u e f r o m
c o n t r a c t s wi t h
c u s t o m e r s –
d i s c o v e r t h e
I F R S 1 5
d i s c lo s u r e s
N o t o n l y f o r
b a n k s -
D i s c o v e r I F R S 9
i n t h e w o r l d o f
c o r p o r a t e s
Our team dealing with implementation of IFRS 16
Accounting Advisory
P a w e ł W e s o ł o w s k i
P a r t n e r
t e l. + 4 8 5 0 2 1 8 4 2 7 7
Accounting Advisory
R a d o m i ł M a ś la k
D i r e c t o r
t e l + 4 8 5 0 2 1 8 4 2 2 3
Training – open and in company workshops
K a t a r z y n a G o s p o d a r c z y k
S e n i o r M a n a g e r
t e l. + 4 8 5 0 2 1 8 4 0 2 9
Training – open and in company workshops
D o r o t a L a c h - W a w r y s z u k
T r ai n i n g c o o r d i n a t o r
t e l. + 4 8 5 1 9 5 0 4 3 4 0
© 2019 PricewaterhouseCoopers Polska spółka z ograniczoną odpowiedzialnością Audyt sp. k (prev. PricewaterhouseCoopers
Sp. z o.o.), ul. Polna 11, 00-633 Warsaw, Poland, T: +48 (22) 746 4000 , F:+48 (22) 742 4040 , www.pwc.pl PricewaterhouseCoopers
Polska spółka z ograniczoną odpowiedzialnością Audyt sp. k (prev. PricewaterhouseCoopers Sp. z o.o.) is entered into the National
Court Register maintained by the District Court for the Capital City of Warsaw, under KRS number 0000750050, NIP 526-021-02-28.
The seat of the Company is in Warsaw at Polna 11.
This content is for general information purposes only, and should not be used as a substitute for consultation with professional
advisors. At PwC, our purpose is to build trust in society and solve important problems. PwC is a network of firms in 158 countries with
more than 236,000 people who are committed to delivering quality in assurance, advisory and tax services. Find out more and tell us
what matters to you by visiting us at www.pwc.pl