Principles of consolidation


The consolidated financial statements of the Repower Group have been prepared in accordance with the International Financial Reporting Standards (IFRS) promulgated by the International Accounting Standards Board (IASB). They provide a true and fair view of the financial position, results of operations and cash flows of the Repower Group. All current standards and interpretations were applied in preparing the consolidated financial statements, which comply with Swiss law.

The consolidated financial statements are drawn up in Swiss francs (CHF). With the exception of items designated otherwise, all figures are rounded in thousands of francs (CHF thousands).

The consolidated financial statements were prepared on the basis of historical acquisition costs. Exceptions include replacement values in respect of held-for-trading positions, inventories and other financial instruments, for which IFRS requires other valuation methods.

These are explained in the following accounting and valuation principles.

New and revised accounting and valuation principles

The accounting and valuation principles used correspond to the principles applied in the previous year, with the following exceptions: The Repower Group reviewed the new or changed standards and interpretations listed below, and implemented them where necessary during the year under review. This had no significant impact on the consolidated annual financial statements.

2008 – 2009 annual changes

IAS 27
Group and Separate Financial Statements (IFRS)

IAS 39
Financial Instruments: Recognition and Measurement

Share-based Payment

Business Combinations

Distributions of Non-cash Assets to Owners

Transfers of Assets from Customers

The IASB and IFRIC have also issued other revised or new standards and interpretations, but these will only be adopted in subsequent financial years.

2010 annual changes

(applicable to financial years starting on or after 1 January 2011)

IAS 12
Amendments to Deferred Taxes: Recovery of Underlying Assets (applicable to financial years starting on or after 1 July 2011)

IAS 24
Related Party Disclosures (applicable to financial years starting on or after 1 January 2011)

IAS 32
Financial Instruments: Presentation (applicable to financial years starting on or after 1 February 2010)

Amendments to Financial Instruments: Disclosures (applicable to financial years starting on or after 1 July 2011)

Financial Instruments: Disclosures for OCI Statement (applicable to financial years starting on or after 1 January 2012)

Financial Instruments (applicable to financial years starting on or after 1 January 2013)

The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction (applicable to financial years starting on or after 1 January 2011)

Extinguishing Financial Liabilities with Equity Instruments (applicable to financial years starting on or after 1 July 2010)

The Repower Group is currently analysing the implementation and impact of the new or changed standards.

Scope of consolidation

The consolidated financial statements cover Repower AG and all Swiss and foreign companies over which Repower is able to exercise operational and financial control. These companies are fully consolidated and designated as Group companies. Their financial year ends on 31 December.

Minority holdings in associates whose financial and business policies Repower Group is unable to control, but over which it is able to exert a significant influence, are accounted for in the consolidated financial statements using the equity method. Jointly-managed partner plants (joint ventures) are also accounted for in the consolidated financial statements using the equity method.

Consolidation method

Fully consolidated companies are included in the consolidated financial statements in their entirety (assets, liabilities, income and expenses). Investments in associates and partner plants are accounted for using the equity method on the basis of the share of equity. If these companies and partner plants apply accounting and valuation principles that deviate from those adopted by the Repower Group, appropriate adjustments are made in the consolidated financial statements.

Business combinations are accounted for using the purchase method. The acquisition costs are calculated by measuring the purchased net assets at fair value on the date of acquisition. A positive difference is capitalised as goodwill and subject to an annual impairment test. A negative difference is recognised in the income statement as negative goodwill on the date of acquisition. Group companies are deconsolidated from the date on which they are sold or no longer controlled by the Repower Group.

Intragroup transactions

All intragroup transactions (receivables and payables, income and expenses) are eliminated and the proportion of equity attributable to minority shareholders as well as their share in the results of consolidated companies, are recognised separately. Income arising from intragroup transactions and holdings is eliminated and charged to income.

For internal billing between Group companies the agreed billing prices, which are based on market prices, apply. Electricity purchased by partner plants is billed to the Repower Group on the basis of existing partner contracts – irrespective of market prices – at actual cost.

Currency translations

The consolidated financial statements are drawn up and presented in Swiss francs. Each Group company defines its own functional currency in which the financial statements are drawn up. Foreign currency transactions are converted using the Group company's functional currency at the exchange rate on the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are converted to the functional currency at the closing rate on the balance sheet date. Currency translation differences are charged to income. Non-monetary foreign currency positions measured at fair value are converted at the rate on the balance sheet date in order to determine the fair value.

The functional currency for the main foreign Group companies is the euro. Assets and liabilities of Group companies are translated into Swiss francs at the closing rate on the balance sheet date. Income statement items are translated using the average exchange rate for the year. When translating foreign currencies, euros were translated at the closing rate of CHF/EUR 1.2500 (previous year: 1.4863) and an average rate of CHF/EUR 1.3774 (previous year: 1.5101). Positions in other currencies are insignificant and were converted using the rates published by the European Central Bank (ECB Fixings). The translation differences between the closing exchange rate and the average exchange rate are recognised as an effect of currency translation in other income/expenses in the statement of comprehensive income. If Group companies are disposed of, the corresponding accumulated translation differences are derecognised in the income statement.