Notes to the Consolidated Financial Statements (continued)
-
-
8.4 Other non-current assets
O O Qs
Introduction Report of the Executive Board Report of the Supervisory Board
In millions of
2019
2018
Balance as at 1 January
135
145
Policy changes
(2)
Addition to allowance
7
5
Allowance used
(56)
(11)
Allowance released
(3)
Effect of movements in exchange rates
2
1
Other
(6)
(3)
Balance as at 31 December
79
135
Accounting estimates
HEINEKEN determines on each reporting date the impairment of loans and advances to customers
using an expected credit loss model which estimates the credit losses over 12 months. Only in case a
significant increase in credit risk occurs (e.g. more than 30 days overdue, change in credit rating, payment
delays in other receivables from the customer) the credit losses over the lifetime of the asset are incurred.
Individually significant financial assets are tested for impairment on an individual basis. The remaining
financial assets are assessed collectively in groups that share similar credit risk characteristics. For more
information on HEINEKEN's credit risk exposure refer to note 11.5.
Accounting policies
Loans and advances to customers are initially measured at fair value and subsequently at amortised cost
minus any impairment losses.
Other non-current assets mainly consist of Fair Value through Other Comprehensive Income (FVOCI)
investments, prepayments and other receivables with a duration longer than 12 months.
In millions of
Note
2019
2018*
Fair value through OCI investments
408
501
Non-current derivatives
11.6
2
35
Loans to joint ventures and associates
38
9
Long-term prepayments
439
466
Other receivables
368
209
Other non-current assets
1,255
1,220
Restated for IAS 37. Refer to note 4 for further details.
Financial Statements
Sustainability Review
Heineken N.V. Annual Report 2019
Other Information
The FVOCI investments primarily consist of equity securities. HEINEKEN designates these investments as
FVOCI as these are not held for trading purposes. As at 31 December 2019 the investment of €241 million
(2018: €331 million) in the Saigon Alcohol Beer and Beverages Corporation ('SABECO', Vietnam), is the
main FVOCI equity investment.
The other receivables include lease receivables of €167 million (2018: nil). Including the short-term
portion of lease receivables, the average outstanding term of the lease receivables is 4.6 years (2018: N/A).
The remainder of other receivables mainly originate from the acquisition of the beer operations of FEMSA
and represent a receivable on the Brazilian authorities on which interest is calculated in accordance with
Brazilian legislation. Collection of this receivable is expected to be beyond a period of five years. A part
of the aforementioned receivables qualifies for indemnification towards FEMSA which are provided for.
Sensitivity analysis - equity securities
An increase or decrease of 1% in the share price of the equity securities at the reporting date would not
have a material impact.
Accounting estimates
HEINEKEN determines on each reporting date the impairment of other receivables using an expected credit
loss model which estimates the credit losses over 12 months. Only in case a significant increase in credit
risk occurs (e.g. more than 30 days overdue, change in credit rating, payment delays in other receivables
from the customer) the credit losses over the lifetime of the asset are incurred. Individually significant other
receivables are tested for impairment on an individual basis. The remaining financial assets are assessed
collectively in groups that share similar credit risk characteristics. For more information on HEINEKEN's credit
risk exposure refer to Note 11.5.
Accounting policies
Fair value through OCI investments
HEINEKEN's investments in equity securities are classified as FVOCI. These investments are interests in
entities where HEINEKEN has less than significant influence. This is generally the case by ownership of less
than 20% of the voting rights.
FVOCI investments are measured at fair value (refer to note 13.1). The fair value changes are recognised
in OCI and presented within equity in the fair value reserve. Dividend income is recognised in profit or loss.
Non-current derivatives
Refer to the accounting policies on derivative financial instruments in note 11.6.
Other
The remaining non-current assets as presented in the table above are initially measured at fair value and
subsequently at amortised cost minus any impairment losses.
