66. Notes to the consolidated financial statements
Significant accounting policies
Heineken N.V. (the 'Company") is a company domiciled in the Netherlands. The consolidated financial statements
of the Company for the year ended 31 December 2005 comprise the Company and its subsidiaries (together
referred to as 'Heineken') and the Heineken's interest in associates and joint ventures.
A summary of the main subsidiaries and joint ventures is included in note 27 and 28. The financial statements
have been prepared by the Executive Board of the Company and authorised for issue on 21 February 2006
and will be submitted for approval to the Annual General Meeting of Shareholders on 20 April 2006.
(a) Statement of compliance
The consolidated financial statements have been prepared for the first time in accordance with International
Financial Reporting Standards (IFRS) and its interpretations issued by the International Accounting Standards
Board (IASB).
Only IFRS standards adopted by the EU (i.e., only IFRS's that are adopted for use in the EU at the date of
authorisation) have been applied in preparation of the consolidated financial statements.
IFRS 1 has been applied and an explanation of how the transition to IFRS has affected the reported financial
position, financial performance and cash flows is provided in note 30.
(b) Basis of preparation
The financial statements are presented in Euro, rounded to the nearest million. They are prepared on the
historical cost basis except that the following assets and liabilities are stated at their fair value: derivative
financial instruments, financial instruments held for trading and financial instruments available-for-sale.
The accounting policies have been consistently applied to all periods presented in these consolidated
financial statements and in preparing an opening IFRS balance sheet at 1 January 2004 for the purpose of
the transition to IFRS, except for the comparative information relating to financial instruments. Comparative
information in respect of financial instruments is based on previous Dutch GAAP. The adoption in the current
year of IAS 32 and 39 financial instruments by Heineken and its effect on the balance sheet at 1 January 2005
are disclosed in note 18. Heineken has used the IFRS exemption not to restate the comparative figures.
The preparation of the financial statements in accordance with IFRS requires management to make judgements,
estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities,
income and expenses. The estimates and associated assumptions are based on historical experience and
various other factors that are believed to be reasonable under the circumstances, the result of which form
the basis of making the judgements about the carrying values of the assets and liabilities that are not readily
apparent from other sources. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates
are recognised in the period in which the estimate is revised if the revision affects only that period or in the
period of the revision and future periods if the revision affects both current and future periods.
Note 8,9 and 20 contain information about the assumptions used in respect of property, plant and equipment,
intangible assets and employee benefits. In note 23 the exposure to credit, interest rate and currency rate
risks is explained.
Described in the notes to the financial statements are the most critical accounting judgements in applying
Heineken's accounting policies.
Heineken N.V. - Annual Report 2005
