N o t es
Accounting policies The annual report of Verdo Holding A/S for 2021 is presented in accordance with the Danish Financial Statements Act for large enterprises in reporting class C.
The accounting policies have been applied consistently with last year. Comparative figures have been adjusted this year to ensure a true and fair view. These adjustments do not affect either profit or equity. A significant error has been corrected this year in the consolidated financial statements, resulting from an item of property, plant and equipment disclosed under ‘Distribution systems and installations, and meters’ subsequently being assessed as a financial fixed asset. The ‘Property, plant and equipment’ account has been debited DKK 93,145 thousand, ‘Other receivables (long-term)’ has been credited DKK 94,159 thousand and ‘Equity’ has been credited DKK 1,014 thousand. The correction does not affect the income statements in either 2020 or 2021. The financial statements for 2021 are presented in thousands of Danish kroner (DKK ‘000).
General Recognition and measurement Income is recognised in the income statement as earned. In addition, all costs incurred to generate the earnings for the year are recognised in the income statement, including depreciation, amortisation and provisions as well as reversals due to changed accounting estimates of amounts previously recognised in the income statement. Assets are recognised in the balance sheet when it is probable that future economic benefits will flow to the Group and the parent company, and the value of the assets can be measured reliably. Liabilities are recognised in the balance sheet when it is probable that future economic benefits will flow out of the Group and the parent company, and the value of the liabilities can be measured reliably. On initial recognition, assets and liabilities are measured at cost. Subsequently, assets and liabilities are measured as described for each item below. Certain financial assets and liabilities are measured at amortised cost, applying a constant effective interest rate until maturity. Amortised cost is calculated as original cost less any repayments and with addition/deduction of the cumulative amortisation of the difference between cost and the nominal amount. This means that any capital losses and gains are distributed across the time to maturity.
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Annual report 2021
On recognition and measurement, account is taken of predictable losses and risks arising prior to the presentation of the annual report and proving or disproving conditions existing on the balance sheet date.
Principles of consolidation The consolidated financial statements comprise the parent company Verdo Holding A/S as well as enterprises in which the parent company directly or indirectly holds more than 50% of the voting rights, or in which the parent company through shareholdings or otherwise has a controlling interest. On consolidation, items of a similar nature are combined. All intercompany income and expenses, shareholdings, dividends and balances as well as realised and unrealised internal gains and losses from transactions between the consolidated enterprises are fully eliminated on consolidation. The parent company’s equity investments in the consolidated subsidiaries are eliminated against the parent company’s share of the equity value of the subsidiaries calculated at the time of establishment of the affiliation. Verdo Holding A/S is included in the consolidated financial statements of Verdo a.m.b.a.
Minority interests Minority interests form part of the Group’s total equity. In the distribution of the profit/loss for the year, the profit/loss is divided into the portion attributable to minority interests and the portion attributable to the parent company’s shareholders. Minority interests are recognised at the carrying amount of the acquired assets and liabilities at the time of acquisition of subsidiaries.
Revenue caps Some of the consolidated companies are subject to the special revenue cap rules applying under the Danish acts on electricity, water and heat regulation. Under these rules, any surplus income or deficit, calculated as the profit/loss for the year under the Danish acts on the supply of electricity, natural gas and heat relative to the tariffs charged, must be transferred back or charged to consumers through reduced or increased tariffs in the year following the year giving rise to the surplus income or deficit. Surplus income or deficit is therefore recognised in revenue. Under the rules of the Danish acts on the supply of electricity, natural gas and heat, any accumulated surplus income or deficit must be recognised in the balance sheet as payables to or receivables from customers.
