SIX Exchange Regulation announced that has reached an agreement with Perfect Holding SA in connection with a breach of the accounting standards (IFRS) in the 2016 interim financial statements. The identified deficiency relates to the translation of goodwill arising from the acquisition of a foreign operation.
As part of the agreement, the company has committed itself to correct the error in both the 2017 interim and annual financial statements and to make a payment of CHF 5,000 to the IFRS- Foundation.
In 2012, Perfect Holding SA acquired Oxygen Aviation Ltd, domiciled in Horsham (UK), as a foreign sub- sidiary and recognised the resulting goodwill in its balance sheet. However, contrary to the requirements of IAS 21, Perfect Holding SA did not treat this goodwill as an asset of the foreign operation. As a result, Perfect Holding SA did not carry this goodwill in British Pounds (GBP) and thus no translation into the group’s presentation currency Swiss Francs (CHF) occurred. This omission led to an overstatement by CHF 447 thousand of (i) the carrying value of goodwill, (ii) total assets and (iii) total equity in the IFRS interim financial statements as of 30 June 2016.
|
Financialstatementposition |
Amounts as stated in the 2016 IFRS interim finan- cial statements |
Corrected amounts after translating goodwill from GBP to CHF |
Effect |
|
Goodwill |
KCHF 3’984 |
KCHF 3’537 |
KCHF -447 (-11.2%) |
|
Total assets |
KCHF 8’883 |
KCHF 8’436 |
KCHF -447 (-5.0%) |
|
Total equity |
KCHF 5’889 |
KCHF 5’442 |
KCHF -447 (-7.6%) |
As part of the agreement, Perfect Holding SA has committed itself to correct and disclose the error in both the 2017 interim and annual financial statements and to henceforth translate the goodwill from this acqui- sition in accordance with the requirements of IAS 21. In addition, the company will make a payment of CHF 5,000 to the IFRS-Foundation as part of the agreement.
The investigation opened by SIX Exchange Regulation against Perfect Holding SA in connection with the 2016 IFRS interim financial statements has been terminated with the conclusion of the agreement; nota- bly, as the error is not considered as a serious violation of the listing rules and as this course of action results in a more timely public information than would have been the case with a duly completed sanction proceeding.