Note 1 Accounting principles
The parent company is applying the Annual Accounts Act (“Årsredovisningslagen”) and the Swedish Financial Reporting Board’s recommendation RFR 2, Reporting of legal entities (“Redovisning för juridiska personer”). The application of RFR 2 requires the parent company to apply all EU-approved IFRSs to the full extent possible within the scope of the Annual Accounts Act and the Pension Obligations Benefit Act (“Tryggandelagen”), taking into account the relationship between reporting and taxation. Amendments to RFR 2 that entered into force in 2017 have not had any significant effect on the parent company’s financial reports for the fiscal year. The differences between the parent company’s and group’s accounting principles are described below:
Classification and presentation
The parent company’s profit and loss statement and balance sheet are presented in accordance with the templates in the Annual Accounts Act. The main difference between IAS 1 Presentation of Financial Statements and the presentation of the consolidated financial statements is in the reporting of financial income and expenses, fixed assets, shareholder’s equity, and the appearance of “Provisions” in a separate column.
Shares of subsidiaries are reported at acquisition cost in the parent company’s balance sheet. Transaction costs are included in the carrying amounts for shares of group companies. Dividends from subsidiaries are recognized as income when the dividends are considered to be safe and can be reliably calculated.
The parent company does not apply IAS 39 Financial Instruments: Recognition and Measurement. In accordance with the Annual Accounts Act, the parent company applies a method based on acquisition cost.
Borrowing costs are recognized in the P&L statement during the period to which they relate.
Approved amendments to RFR 2 that have not yet entered into force
Management estimates that amendments to RFR 2 that have not yet entered into force are not expected to have any significant effect on the parent company’s financial reports once they are applied for the first time.
Proposed changes to RFR 2 that have not yet entered into force
Management estimates that proposed changes to RFR 2 that have yet to enter into force are not expected to have any significant effect on the parent company’s financial reports once they are applied for the first time.