151 / 222
147
J. Other assets
I Assets held for own use
In accordance with the alternative method allowed by IAS 16 §31, the
part of the property used by the company itself as headquarters is
stated at its fair value. It appears under the item “Assets held for
own use”.
II Subsequent expenditure
Expenditure incurred to refurbish a property that is accounted for
separately, is capitalised. Other expenditure is capitalised only when
it increases the future economic benefits of the property. All other
expenditure is recorded as costs under the income statement (see
S II).
III Depreciation
Investment properties, whether land or constructions, are not
depreciated but recorded at their fair value (see G). Depreciation is
charged to the income statement on a straight-line basis over the
estimated useful lives of the following items:
•
fixture and fittings: 4-10 years;
•
furniture: 8-10 years;
•
computer hardware: 4 years;
•
software: 4 years.
IV Assets held for sale
Assets held for sale (investment properties) are presented sep-
arately in the balance sheet at a value corresponding to their fair
value.
V Impairment
The other assets are subject to an impairment test only if there is an
indication showing that their book value will not be recoverable by
their use or disposal.
K. Finance lease receivables and real estate Public-
Private Partnerships
I Finance lease receivables
Finance lease receivables are valued based on their discounted
value at the interest rate prevailing at the time of their issue. If they
are indexed to an inflation index, this is not taken into account in the
determination of the discounted value. If a derivative financial instru-
ment provides hedging, the market interest rate for this instrument
will serve as a reference rate for calculating the market value of the
receivable at the close of each accounting period. In this case, the
entire unrealised gain generated by the valuation at market value of
the receivable is limited to the unrealised loss relating to the valua-
tion at market value (see F I) of the hedging instrument.
Conversely, any unrealised loss generated by the receivable will be
entirely recorded under the income statement.
II Real estate Public-Private Partnerships
With the exception of the police station in Dendermonde, qualified
as operational leasing and consequently recorded under investment
properties, Public-Private Partnerships are classified as finance
lease receivables and are subject to IFRIC 12. For their accounting
treatment, see K I.
L. Cash and cash equivalents
Cash and cash equivalents comprise current accounts, cash and
short-term placements.
M. Shareholders’ equity
I Ordinary shares
Ordinary shares are classified as equity. External costs directly
attributable to the issue of new shares are shown as a deduction,
net of taxes, of the proceeds.
II Preference shares and mandatory convertible bonds
Preference share and mandatory convertible bond capital is classi-
fied as equity if it meets the definition of an equity instrument under
IAS 32.
III Repurchase of shares
When own shares are repurchased by the Group, the amount of the
consideration paid, including directly attributable costs, is recog-
nised as a change in equity. Repurchased shares are presented in
deduction of the items “Capital” and “Share premium account”. The
proceeds on sales of own shares are directly included under equity
without impacting the income statement.
IV Dividends
Dividends are recognised as debt when they are approved by the
General Shareholders’ Meeting.
N. Interest-bearing borrowings
Interest-bearing borrowings are recognised initially at cost, less
attributable transaction costs. Subsequent to their initial recogni-
tion, interest-bearing borrowings are stated at their amortised cost,
with any difference between cost and redemption value being rec-
ognised under the income statement over the period of the borrow-
ings on an effective interest rate basis. Upfront fees payable to lend-
ers or legal fees are for example integrated into the effective interest
rate calculation. Fixed-rate borrowings are expressed at their amor-
tised cost. If, however, a fixed-rate borrowing is swapped into a
floating-rate borrowing by virtue of a matching Interest Rate Swap
derivative contract, in conformity with fair value hedge accounting
(IAS 39 §86), the change in the fair value of the Swap in the income
statement is compensated by the adjustment of the book value of
the fixed-rate borrowing (see F I).
The convertible borrowings are stated at their fair value at the clos-
ing date.
O. Employee benefits
The Group funds a defined contribution pension scheme for its
employees which is entrusted to an insurance company and thus
independent from the Group. Contributions paid during the account-
ing period are charged to the income statement.
P. Provisions
A provision is recognised in the balance sheet when the group has
a legal or contractual obligation resulting from a past event, and
if it is likely that resources will be required to settle the obligation.
Provisions are determined by discounting the expected future cash
flows at the market rate reflecting, where appropriate, the risk spe-
cific to the liability.
Q. Trade debts and other debts
Trade debts and other debts are stated at cost.
R. Operating revenues
Operating revenues include revenues from lease contracts on build-
ings and revenues from real estate services.
Revenues from lease contracts are recorded under the rental income
item. Some lease contracts allow for a period of free occupancy fol-
lowed by a period during which the agreed rent is due by the tenant.
In this case, the total amount of the contractual rent to be collected
until the first break option for the tenant is recognised under the
income statement (item “rental income”) pro rata temporis over the
length of the lease contract, beginning at the start of the occupancy
and ending at the first break option (i.e. the fixed term of the lease).
More accurately, the contractual rent expressed in annual amount is
first recognised as a revenue and the rent-free period spread over
the fixed term of the lease is then booked as an expense. Hence, an
accrued income account is debited at the start of the lease for an