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3. Significant accounting policies
General
The accounting policies set out below have been applied consistently to all periods presented in these consolidated financial
statements and have been applied consistently by Heineken entities.
(a) Basis of consolidation
(i) Business combinations
Business combinations are accounted for using the acquisition method as at the acquisition date, which is the date on which control
is transferred to the Group. Control is the power to govern the financial and operating policies of an entity so as to obtain benefits
from its activities. In assessing control, the Group takes into consideration potential voting rights that currently are exercisable.
Heineken has changed its accounting policy with respect to accounting for business combinations. See note 2(e) for further details.
(i Subsidiaries
Subsidiaries are entities controlled by Heineken. Control exists when Heineken has the power, directly or indirectly, to govern the
ancial and operating policies of an entity so as to obtain benefits from its activities. In assessing control, potential voting rights
at currently are exercisable or convertible are taken into account. The financial statements of subsidiaries are included in the
c nsolidated financial statements from the date that control commences until the date that control ceases. Accounting policies of
s bsidiaries have been changed where necessary to ensure consistency with the policies adopted by Heineken. Losses applicable to
t non-controlling interests in a subsidiary are allocated to the non-controlling interests even if doing so causes the non-controlling
i erests to have a deficit balance.
Special Purpose Entities (SPEs)
SPE is consolidated if, based on an evaluation of the substance of its relationship with Heineken and the SPE's risks and rewards,
h leken concludes that it controls the SPE. SPEs controlled by Heineken were established under terms that impose strict limitations
the decision-making powers of the SPE's management and that result in Heineken receiving the majority of the benefits related to
SPE's operations and net assets, being exposed to the majority of risks incident to the SPE's activities, and retaining the majority
the residual or ownership risks related to the SPE or their assets.
Acquisitions from entities under common control
siness combinations arising from transfers of interests in entities that are under the control of the shareholder that controls the
oup are accounted for as if the acquisition had occurred at the beginning of the earliest comparative year presented or, if later,
the date that common control was established; for this purpose comparatives are restated. The assets and liabilities acquired are
ognised at the carrying amounts recognised previously in the Group controlling shareholder's consolidated financial statements,
e components of equity of the acquired entities are added to the same components within Group equity and any gain/loss arising
ecognised directly in equity.
Loss of control
on the loss of control, Heineken derecognises the assets and liabilities of the subsidiary, any non-controlling interests and the
er components of equity related to the subsidiary. Any surplus or deficit arising on the loss of control is recognised in profit or
•s. If Heineken retains any interest in the previous subsidiary, then such interest is measured at fair value at the date that control
ost. Subsequently it is accounted for as an equity-accounted investee or as an available-for-sale financial asset depending on the
:l of influence retained.
ineken N.V. Annual Report 2010
