Basis of presentation and accounting principles Basis of - PDF document

154 Generali Group Annual Integrated Report and Consolidated Financial Statements 2018 Basis of presentation and accounting principles Basis of presentation Consolidated financial statements This document is the consolidated fjnancial statements of Generali Group, registered under number 026 of the In- The set of the consolidated fjnancial statements is made surance Groups Register, whose Parent Company is Ass- up of the balance sheet, the income statement, the icurazioni Generali SpA, a company established in Trieste statement of comprehensive income, the statement of in 1831 with a share capital of € 1.565.165.364 fully paid changes in equity and the statement of cash fmow, as re- up. quired by the ISVAP Regulation No. 7 of 13 July 2007, as subsequently amended. The fjnancial statements also The registered offjce of the Group and the Parent Compa- include special items that are considered signifjcant for ny is established in Trieste, Piazza Duca degli Abruzzi, 2 the Group. and is registered under the number 1,00003 of the register of insurance and reinsurance companies. The Notes, which are mandatory as minimum content established by ISVAP (now IVASS), are presented in the The Generali Group’s consolidated fjnancial statements appendices to the notes to this report. at 31 December 2018 were drawn up in accordance with the IAS/IFRS issued by the IASB and endorsed by the This yearly report is drawn up in Euro (the functional cur- European Union, in accordance with the Regulation (EC) rency used by the entity that prepared the fjnancial state- No. 1606 of 19 July 2002 and the Legislative Decree No. ments) and the amounts are shown in millions, unless 58/1998, as subsequently amended. otherwise stated, the rounded amounts may not add to the rounded total in all cases. The Legislative Decree No. 209/2005 empowered ISVAP to give further instructions for fjnancial statements in com- Consolidation methods pliance with the international accounting standards. In this yearly report the Generali Group prepared its con- Investments in subsidiaries are consolidated line by line, solidated fjnancial statements and Notes in conformity whereas investments in associated companies and inter- with the ISVAP (now IVASS) Regulation No. 7 of 13 July ests in joint ventures are accounted for using the equity 2007, as subsequently amended, and information of the method. Consob Communication No. 6064293 of 28 July 2006. The balance sheet items of the fjnancial statements de- As allowed by the aforementioned Regulation, the Gen- nominated in foreign currencies are translated into Euro erali Group believed it appropriate to supplement its con- based on the exchange rates at the end of the year. solidated fjnancial statements with detailed items and to provide further details in the Notes in order to also meet The profjt and loss account items are translated based the IAS/IFRS requirements. on the average exchange rates of the year. They reason- ably approximate the exchange rates at the dates of the For more information on discontinued operations and transactions. their accounting treatment, please refer to the paragraph Non-current assets or disposal group classified as held for The exchange rate differences arising from the transla- sale in the section Information on consolidation area and tion of the statements expressed in foreign currencies Group companies . are accounted for in equity in an appropriate reserve and recognized in the profjt and loss account only at the time The consolidated fjnancial statements at 31 December of the disposal of the investments. 2018 were approved by the Board of Directors on 13 March 2019. The consolidated fjnancial statements at 31 December 2018 were audited by E&Y S.p.A., the appointed audit fjrm from 2012 to 2020.

Our Consolidated Non-Financial Appendices to the Consolidated Financial 155 We, Generali performance Risk Report Outlook Statement Management Report Statements Exchange rates of the balance sheet Currency Exchange rate at the end of the period (€) 31/12/2018 31/12/2017 US dollar 1.143 1.201 Swiss franc 1.127 1.170 British pound 0.898 0.888 Argentine peso 43.051 22.605 Czech Koruna 25.737 25.529 Exchange rates of the income statement Currency Average exchange rate (€) 31/12/2018 31/12/2017 US dollar 1.181 1.137 Swiss franc 1.155 1.111 British pound 0.885 0.876 Argentine peso* 32.934 18.738 Czech Koruna 25.647 26.328 (*) in accordance with IAS 29, the items of profit or loss has been restated at the exchage rate at the end of the period. Basis of consolidation when the Group has less than a majority of the voting or similar rights of an investee, the Group considers all The consolidated fjnancial statements of the Group in- relevant facts and circumstances in assessing whether it clude the fjnancial statements of Assicurazioni Generali has power over an investee, including: SpA and its subsidiaries. – The contractual arrangement with the other vote hold- ers of the investee; Subsidiaries are all entities (including structured entities) – Rights arising from other contractual arrangements; over which the Group has control. Control is achieved – The Group’s voting rights and potential voting rights. when the Group is exposed, or has rights to variable re- turns from its involvement with the investee and has the The Group reviews periodically and systematically if ability to affect those returns through its power over the there was a variation of one or more elements of control, investee. based on the analysis of the facts and the essential cir- cumstances. Specifjcally, the Group controls an investee if, and only if, the Group has: Assets, liabilities, income and expenses of a subsidiary – power over the investee (i.e., existing not merely pro- acquired or disposed of during the year are included in tective rights that give it the current ability to direct the the consolidated fjnancial statements from the date the relevant activities of the investee, that impact meaning- Group gains control until the date the Group ceases to fully the returns of the investee); control the subsidiary. – exposure, or rights, to variable returns from its involve- ment with the investee; In preparing the consolidated fjnancial statements: – the ability to use its power over the investee to affect – the financial statements of the Parent Company and its its returns. subsidiaries are consolidated line by line through spe- cific “reporting package”, which contribute to the con- Generally, there is a presumption that a majority of voting sistent application of the Group’s accounting policies. rights result in control. To support this presumption and For consolidation purposes, if the financial year-end