IPF årsrapport 2018 (eng) - Flipbook - Side 32
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Increases and decreases in fair values of investment
Receivables
assets in group undertakings and associated undertakings
Receivables are measured at amortised cost, which
are fully recognised in the income statement under income
usually corresponds to nominal amount. Deductions are
from such undertakings.
made to account for any losses.
Loans to group and associated undertakings
Deferred tax assets
Loans to group and associated undertakings are measured
Deferred tax on yields of certain pension-scheme assets
at amortised cost.
calculated on the basis of a negative, collective tax basis
(tax on yields of certain pension-scheme assets at
Other financial investment assets
institution level) is recognised as an asset in the balance
Listed equity investments and investment units are
sheet for offsetting in positive tax on yields of certain
measured at fair value, calculated at the official closing
pension-scheme assets in subsequent years, provided it is
prices on the reporting date. A calculated rate is used for
likely that such offset can be utilised in the years to come.
equity investments and investment units that are not
These considerations include the fact that, under certain
actively traded. Unlisted equity investments and units in
conditions, tax assets not utilised on offsetting in positive
investment associations are measured at estimated fair
tax on yields of certain pension-scheme assets during the
value using recognised valuation methods, for example by
first five calendar years after the tax asset was created will
comparing with similar assets for which a fair value is
be repaid to the company by the Danish tax authorities
available or by discounting expected future cash flows etc.
(SKAT). Furthermore, a negative individual tax on yields of
certain pension-scheme assets is recognised under tax
Listed bonds are also measured at fair value, calculated at
assets. In years with a negative addition of interest to the
the official closing prices on the reporting date. A calculated
market-rate scheme, this tax is recognised under life-
rate is used for bonds that are not actively traded. Unlisted
assurance provisions, and it will be eliminated in a positive
bonds are measured at an estimated fair value by means of
addition of interest in future years.
recognised valuation methods, see above. The fair value of
called bonds is measured at present value.
Subordinate loan capital
Subordinate loan capital includes excess capital and other
Bonds that are sold and repurchased forward (genuine sale
subordinated loan capital, and constitutes risk capital
and repurchase transactions) are part of the bond portfolio.
provided by the members. Excess capital comprises
The fair value of these at the end of the financial year is
special bonus provisions type B, with an interest rate the
shown in note 18 to the financial statements on collateral
same as equity, whereas other subordinated loan capital
ceded.
comprises special bonus provisions type A, with interest
rates on market terms. Subordinate loan capital is included
Listed and unlisted derivative financial instruments are
in own funds to meet the solvency capital requirement.
measured at fair value on the reporting date. Fair value is
set at the mid-market prices on the reporting date. Positive
Provisions for insurance and investment contracts
fair values are recognised in the balance sheet under other
Premium provisions
financial investment assets, and negative values are
Relate to sickness and accident insurance and cover the
recognised in the balance sheet under other debt. Value
present value of expected future payments concerning
adjustments are recognised in the income statement under
compensation and costs of insurance events which can be
value adjustments. Note 22 to the financial statements
expected to occur after the end of the financial year.
shows a summary of the derivative financial instruments
with associated fair values.
Life-assurance provisions at average rate
Life-assurance provisions at average rate are calculated at
Information on prices etc. appearing after the closing date
market value based on the technical basis notified to the
of the financial statements will only be recognised if these
Danish Financial Supervisory Authority. Provisions are
are material to assessment of the annual financial
calculated as the present value of the expected future
statements.
payments for current insurance contracts, based on a
discounting yield curve and assumptions on insurance
Investment assets attached to market-return products
risks (mortality rate and disability, etc.) and costs, fixed at
Investment assets attached to market-return products are
best estimate. The yield curve defined in the Executive
recognised and measured according to the same principles
Order on Presentation of Financial Statements is applied
as other investment assets, see above.
as the discount rate. Industriens Pension applies the
EIOPA yield curve without volatility adjustments.