Report of the Report of the
Contents Overview Executive Board Supervisory Board
Financial
statements
Other information
3. Significant accounting policies
(b) Foreign currency
(i) Foreign currency transactions
Transactions in foreign currencies are translated to the respective functional currencies of HEIN EKEN entities at the exchange rates at
the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are retranslated
to the functional currency at the exchange rate at that date. The foreign currency gain or loss arising on monetary items is the difference
between amortised cost in the functional currency at the beginning of the period, adjusted for effective interest and payments
during the period, and the amortised cost in foreign currency translated at the exchange rate at the end of the reporting period.
Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are retranslated to the functional
currency at the exchange rate at the date that the fair value was determined.
Non-monetary items in a foreign currency that are measured in terms of historical cost are translated using the exchange rate at the
date of the transaction. Foreign currency differences arising on retranslation are recognised in profit or loss, except for differences
arising on the retranslation of available-for-sale (equity) investments and foreign currency differences arising on the retranslation
of a financial liability designated as a hedge of a net investment, which are recognised in other comprehensive income.
Non-monetary assets and liabilities denominated in foreign currencies that are measured at cost remain translated into the
functional currency at historical exchange rates.
(ii) Foreign operations
The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are translated
to Euro at exchange rates at the reporting date. The income and expenses of foreign operations, excluding foreign operations in
hyperinflationary economies, are translated to Euro at exchange rates approximating the exchange rates ruling at the dates of the
transactions. Group entities, with a functional currency being the currency of a hyperinflationary economy, first restate their financial
statements in accordance with IAS 29, Financial Reporting in Hyperinflationary Economies (see'Reporting in hyperinflationary
economies' below). The related income, costs and balance sheet amounts are translated at the foreign exchange rate ruling at the
balance sheet date.
Foreign currency differences are recognised in other comprehensive income and are presented within equity in the translation reserve.
However, if the operation is a non-wholly-owned subsidiary, then the relevant proportionate share of the translation difference is
allocated to the non-controlling interests. When a foreign operation is disposed of such that control, significant influence or joint
control is lost, the cumulative amount in the translation reserve related to that foreign operation is reclassified to profit or loss as part
of the gain or loss on disposal. When HEINEKEN disposes of only part of its interest in a subsidiary that includes a foreign operation
while retaining control, the relevant proportion of the cumulative amount is reattributed to non-controlling interests. When HEINEKEN
disposes of only part of its investment in an associate or joint venture that includes a foreign operation while retaining significant
influence or joint control, the relevant proportion of the cumulative amount is reclassified to profit or loss.
Foreign exchange gains and losses arising from a monetary item receivable from or payable to a foreign operation, the settlement
of which is neither planned nor likely in the foreseeable future, are considered to form part of a net investment in a foreign operation
and are recognised in other comprehensive income, and are presented within equity in the translation reserve.
Heineken N.V. Annual Report 2013
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