Page 64 - Demo

1. General InformationDKSH (the %u201cGroup%u201d) is a Market Expansion Services Group with a focus on Asia. DKSH helps other companies and brands to grow their business in new or existing markets with 27,062 specialized staff (2022: 31,077).The Group offers any combination of sourcing, market insights, marketing and sales, eCommerce, distribution and logistics as well as after-sales services. It provides business partners with expertise as well as on-the-ground logistics based on a comprehensive network of unique size and depth.Business activities are organized into four specialized Business Units that mirror the Group%u2019s fields of expertise: Healthcare, Consumer Goods, Performance Materials and Technology.DKSH Holding Ltd. is the parent company of DKSH Group. Its shares are listed on the SIX Swiss Exchange. The address of its registered office is Wiesenstrasse 8, 8008 Zurich, Switzerland.The consolidated financial statements of the Group as of December 31, 2023, were approved by the Board of Directors on February 15, 2024, and are subject to approval by the Ordinary General Meeting of shareholders on March 26, 2024.2. Accounting PoliciesThe principal accounting policies adopted in the preparation of these consolidated financial statements are set out beloBasis of PreparationThe consolidated financial statements are prepared in accordance with and comply with IFRS Accounting Standards. The financial statements have been prepared on an accrual basis and under the historical cost convention, as modified by the revaluation of certain financial assets, and financial liabilities (including derivative instruments) at fair value. All amounts are in millions of Swiss francs unless otherwise stated.(a) ConsolidationSubsidiaries are consolidated from the date on which control is transferred to the Group and are no longer consolidated from the date that control ceases. All intercompany transactions, balances and unrealized gains and losses on transactions between Group companies are eliminated on consolidation. The difference of the cost of an acquisition of non-controlling interest over the carrying amounts of net assets acquired is recognized directly in equity.A listing of the Group%u2019s principal subsidiaries is set out in Note 35. The financial effect of the acquisitions and disposals is shown in Note 30.Business Combinations and Related GoodwillThe cost of an acquisition is measured as the fair value of the consideration given, including contingent consideration liabilities and the fair value of any previous equity interest. Acquisition-related costs are expensed as incurred. The excess of the cost of an acquisition over the fair value of the net identifiable assets, liabilities and contingent liabilities acquired is capitalized. If the cost of an acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognized directly in other income in the income statement. With regards to business combinations, put option and call option agreements relating to the shares held by the non-controlling shareholders are entered from time to time. If the Group has acquired a present ownership interest as part of a business combination, the present value of the redemption amount of the put option is recognized as a financial liability with any excess over the carrying amount of the non-controlling interest recognized as goodwill. In such case, the non-controlling interest is deemed to have been acquired at the acquisition date and therefore any excess arising should follow the accounting treatment as in a business combination acquiring full shares of the target company. Subsequent value changes of the financial liability classified at amortized cost are recognized in the statement of income and no earnings are attributed to the non-controlling interest. If the Group has not acquired a present ownership interest as part of a business combination, the non-controlling interest continues to receive an allocation of profit or loss and is reclassified as a financial liability at each reporting date as if the acquisition took place at that date. Any excess over the reclassified carrying amount of the non-controlling interest and subsequent value changes of the financial liability are recognized directly in retained earnings.(b) Investments in Associates and Joint VenturesAssociates are entities over which the Group has significant influence. Notes to the Consolidated Financial Statements 62 Consolidated Financial Statements DKSH Group