Notes to the Consolidated Balance Sheet,
Profit and Loss Account and Cash Flow Statement for 2004
83 Heineken N.V. Annual Report 2004 Financial Statements 2004
Valuation, determination of results and consolidation
General
The financial statements and the report of the Executive Board have been prepared in accordance
with the provisions of Part 9, Book 2, of the Netherlands Civil Code and the Guidelines for Annual
Reporting in the Netherlands (GAR Guidelines).
The financial information relating to Heineken N.V. has been included in the consolidated balance sheet
and profit and loss account. Accordingly the abridged presentation permitted by Section 402, Part 9,
Book 2, of the Netherlands Civil Code has been used for the Heineken N.V. profit and loss account.
The amounts disclosed in the notes are in millions of euros unless otherwise indicated.
In preparing the financial statements, the management makes estimates and assumptions affecting
the reported assets, equity and liabilities as at the balance sheet date as well as the reported revenues.
Significant estimates concern those affecting tangible fixed assets, goodwill, provisions, impairments,
pensions and corporation tax.
Changes in accounting policies
With effect from the beginning of the 2004 financial year, pension costs and provisions have been
accounted for on the basis of GAR Guideline 271 Employee benefits. This change in accounting policies
has the non-recurring effect of reducing shareholders' equity as at 1 January 2004 by an amount
of €187 million. The adoption of the provisions of GAR 271 Employee benefits resulted in the inclusion
of the deferred tax asset of €100 million in respect of taxation on the difference between the valuation
for reporting purposes and that for tax purposes. This deferred tax asset has been netted off with the
provision for deferred tax liabilities.
In accordance with the transitional provisions of GAR 271, the comparative figures in the consolidated
profit and loss account have not been restated to reflect the change in accounting policies. If Guideline
271 Employee benefits had already been adopted in 2003, the pension costs in 2003 would have been
€23 million higher and the net profit €15 million lower.
Consolidation
Heineken N.V. and the companies in which Heineken N.V. directly or indirectly holds more than
half of the voting share capital or is able to exercise control are fully consolidated. Minority interests
in group equity and group profits are presented separately.
Proportional consolidation is applied in the case of companies in which the Heineken group has
a direct interest and exercises a controlling influence on management decisions in partnership
with other shareholders.
In the analyses of movements in various assets and liabilities, disclosures of'changes in the
consolidation' relate to increases or decreases in the group's interests in consolidated companies.
There were a number of changes in the scope of the consolidation during the year.
The most significant changes with regard to the financial statements are mentioned below.
Shikhan Brewery, Russia
Volga Brewery, Russia
Sobol Beer LLC, West Siberia
Consolidated from
1 October 2004
1 October 2004
1 December 2004
These changes in the consolidation led to an increase in net turnover of €27 million.
