O A Notes to the Consolidated Financial Statements (continued) (b) Upcoming changes in accounting policies for 2019 Transition: Introduction Report of the Executive Board Report of the Supervisory Board The IFRS 15 changes have no impact on operating profit, net profit and EPS. In below table the impact of IFRS 15 on the 2017 figures is reflected: For the year ended 31 December In millions of 2017 Reported Impact IFRS 15 2017 Restated Revenue 21,888 3,955 25,843 Excise tax expense (4,234) (4,234) Net revenue (279) 21,609 Other income 141 141 Raw materials, consumables and services (13,540) 279 (13,261) Personnel expenses (3,550) (3,550) Amortisation, depreciation and impairments (1,587) (1,587) Total other expenses (18,677) 279 (18,398) Operating profit 3,352 3,352 Profit before income tax 2,908 2,908 Income tax expense (755) (755) Profit 2,153 2,153 Attributable to: Shareholders of the Company (net profit) 1,935 1,935 Non-controlling interests 218 218 Other new standards and amendments Other changes effective in 2018 had no significant impact on the disclosures or amounts recognised in HEINEKEN's consolidated financial statements. The following change in standards and amendments to standards will be effective in 2019 and will have a significant impact on HEINEKEN's consolidated financial statements: IFRS 16 Leases IFRS 16 'Leases' replaces existing guidance on leases, including IAS 17. HEINEKEN will implement IFRS 16 per 1 January 2019 by applying the modified retrospective method, meaning that the 2018 comparative numbers in the 2019 financial statements will not be restated. Under the new standard, all operating lease contracts will be recognised on HEINEKEN's balance sheet, except for short-term and low value leases. Lease expenses currently recorded in the income statement will be replaced by depreciation and interest expenses for all lease contracts in scope of the standard. Financial Statements Sustainability Review Heineken N.V. Annual Report 2018 l6 Other Information Transition options and practical expedients HEINEKEN will apply the following practical expedients upon transition to the new standard: Recognition (permanent): - Apply the short-term lease exemption, meaning that leases with a duration of less than a year will be expensed in the income statement on a straight-line basis - Apply the low value lease exemption, meaning that leased assets with an individual value of €5 thousand or less if bought new will be expensed in the income statement on a straight-line basis - Apply the option to include non-lease components in the lease liability for equipment leases - Use the option to grandfather the lease classification for existing contracts - Use the transition option for leases with a remaining contract period of less than one year, meaning that these leases will not be recorded on balance and the payments will be expensed in the income statement on a straight-line basis - Measure the Right-of-Use Asset based on the Lease Liability recognised Accounting policy on the lease term applied as per 1 January 2019 The lease term shall be determined as the non-cancellable period of a lease, together with: - Periods covered by an option to extend the lease if HEINEKEN is reasonably certain to make use of that option - Periods covered by an option to terminate the lease if HEINEKEN is reasonably certain not to make use of that option Estimated impact on the financial statements: HEINEKEN has around 30,000 operating leases mainly relating to offices, warehouses, pubs, stores, cars and (forklift) trucks. Based on the contracts that will be capitalised as per 1 January 2019, the estimated impact on the balance sheet on that date, amounts to €1.2 billion increase in total assets and total liabilities. The increase in assets consist of Right-of-use Assets for €0.9 billion and lease receivables for €0.3 billion. The increase in liabilities consists of €1.2 billion of lease liabilities. In some countries, HEINEKEN is operating both as a lessee and a lessor for pubs. HEINEKEN analysed the contracts where HEINEKEN acts as a lessor (subleases) and concluded that under the new standard these sublease contracts are to be treated as a finance lease, where under the previous standard these same leases were treated as an operating lease. This change results in a decrease of revenue, primarily impacting The Netherlands and Belgium.

Jaarverslagen en Personeelsbladen Heineken

Jaarverslagen | 2018 | | pagina 69