Financial Statements Accounting Principles
| Service |
Other Topics
Financial statements
as PDF file
more...
Accounting principles
In accordance with IAS 34 ‘Interim Financial Reporting’, the Group’s interim financial statements as at 31 March 2008 were prepared in a condensed form compared with the consolidated annual financial statements. The only deviation from the historical cost principle was the accounting method applied in measuring financial instruments.
As of the beginning of the 2008 financial year, interpretation IFRIC 11 – ‘IFRS 2 - Group and Treasury Share Transactions’ -, published by the IASB, was applicable. The application of this interpretation did not have any effects on the interim financial statements as at 31 March 2008.
As a matter of principle the interim financial statements as at 31 March 2008 were prepared in accordance with the same accounting and measurement principles as those applied in the preceding consolidated financial statements as at 31 December 2007.
Since the beginning of the 2007 financial year, TUI AG has exercised the option offered under IAS 1 to structure the consolidated profit and loss statement in accordance with the cost of sales format.
In order to enhance international comparability, expenses and income from changes in the value of financial instruments resulting from bunker oil hedges, aircraft fuel hedges and hedges for future cash flows in foreign currencies were allocated to the expense or income items also showing the hedged items. As a result, the previous year’s financial result declined by € 27.5 million in the reference quarter.
Basis of consolidation
The consolidated financial statements included all major subsidiaries in which TUI AG was able to directly or indirectly govern the financial or operating policies such that the Group obtained benefits from the activities of these companies.
The interim financial statements as at 31 March 2008 included a total of 46 domestic and 689 foreign subsidiaries, besides TUI AG.
Since 1 January 2008, seven tourism companies were newly included in consolidation due to acquisitions. One company was liquidated and therefore deconsolidated after the end of the year 2007.
Acquisitions – divestments
In the first quarter of 2008, seven tourism companies were acquired at acquisition costs amounting to the equivalent of € 27.4 million (including ancillary costs).
Summary presentation of the acquisitions
|
Name and headquarters of the acquired company |
Business activity |
Acquirer |
Date of acquisition |
Acquired share |
Acquisition costs1) € million |
|---|---|---|---|---|---|
| Active Safary Pty. Ltd., West Leederville, Australia, and Active Travel & Recruitment Pty. Ltd., West Leederville, Australia | Special tour operator for Australia | Trek America Travel Ltd. |
21 Jan 08 | each 100% | 1.3 |
| Destination Florida-New England, Inc., Florida, USA, and Destination Canada/New England, Inc., Maine, USA | Provider of services for Cruise companies | First Choice Holdings, Inc. |
17 Jan 08 | each 100% | 4.7 |
| Gullivers Group Ltd., Tewkesbury, UK, and Gullivers Sports Travel Ltd., Tewkesbury, UK | Special tour operator | TUI Travel PLC | 29 Feb 08 | each 100% | 21.1 |
| Your Sporting Challenge Ltd., Southampton, UK | Special tour operator | TUI Travel PLC | 19 Mar 08 | 100% | 0.3 |
| Total | 27.4 | ||||
1) The acquisition costs in foreign currencies were translated into € and
also comprised the ancillary costs.
In some cases, acquisition costs also comprised the best possible estimates of
additional purchase price elements depending on future events, in addition to the purchase prices already paid.
Summary presentation of the first-time consolidation balance sheets
|
€ million (translated) |
Carrying amounts as at acquisition date |
Revaluation of assets and liabilities |
Revalued carrying amounts at date of first-time consolidation |
|---|---|---|---|
| Intangible assets | – | 6.0 | 6.0 |
| Property, plant and equipment | 0.5 | – | 0.5 |
| Investment property | 1.1 | – | 1.1 |
| Fixed assets | 1.6 | 6.0 | 7.6 |
| Inventories | – | – | – |
| Receivables and other assets including prepaid expenses | 3.4 | – | 3.4 |
| Cash and cash equivalents | 8.4 | – | 8.4 |
| Deferred tax provisions | – | 1.4 | 1.4 |
| Other provisions | 1.0 | – | 1.0 |
| Financial liabilities | 0.1 | – | 0.1 |
| Liabilities and deferred income | 6.5 | – | 6.5 |
| Equity | 5.8 | 4.6 | 10.4 |
The total difference of around € 17.0 million between the acquisition costs and the acquired revalued net assets was temporarily carried as goodwill in each case.
Due to the short period of time between the acquisition of the companies and the preparation of the present interim report of the TUI Group, the purchase price
allocation to the individual assets and liabilities was only prepared on a temporary basis and it was not possible to make any further disclosures on IFRS 3.